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Can we request our lawyer to clear the debts on a property which we bought and should have been deducted on completion?

Property Law

Antonio Flores Vila

23rd of October 2001

Q. We purchased a villa through en Estate Agent who recommended a 'good' lawyer in Fuengirola. We arranged for the lawyer to have full power of attorney from mid April 2001 and the purchase of the property took approximately 2 months, with a mortgage by Unicaja. We took possession of the property on 29/05/01 and revoked the power of attorney on 21/06/01 after a meeting with the lawyer who assured us that everything was in order.

We later however found that the service bills were not paid up to date and the IBI was in arrears from year 2000. The total bills amounted to approx. 100,000 pesetas! When we contacted the lawyer he said it was because we revoked the power before he had time to settle our affairs. He then said he would contact the agent who would have kept a retainer from the vendor for such circumstances. When we contacted the estate agents, they were not aware that our lawyer had contacted them and referred us back to the lawyer! By the way, we never received any formal letters from this lawyer or proper written communication, only a fax detailing the amount to be transferred to hisaccount, not even receipt for his charges.

We thought by doing things the 'proper' way we would not have anyproblems. We have also since found that because the property was a re-sale, we did not have to pay the plus valia as this is usually paid for by the vendor. This was not explained to us by our lawyer and we feel that he has acted on behalf of the estate agent rather than for us.

We would be very grateful for any advice as we feel very let down.

Anonymous
Torreblanca

    A. There is no need to have a power of attorney for the purpose of paying off previous debts. That is, provided a retention had been made, which is the normal procedure. The lawyer, on completion, did have power to have settled all these issues, and he did not do it. What surprises me is that those debts were not detected by Unicaja, asthey should have conducted searches as well. (This does not happen where you take over an exisiting mortgage.)

    The fact that a lawyer comes recommeded by an agency does not mean that he is biased and will necessarily not act in the best of your interest. There are many lawyers who are recommended on a regular basis, by estate agents, and most do provide an excellent service. However, there are some question marks on how would these lawyers act if their mutual client was to run into problems with the agent.

    Certainly he would think twice before suing the agent, with whom he has a good relationship and obtain good business. This raises issues of independence.

    Dont worry too much about the unpaid debts, unless the vendors are non-residents and have disappeared. The puchase-sale deed normally states that the property is sold free from debts and encumbrances, and this declaration is sworn in front of a public witness, the Notary Public. Technically, the vendor who sells free from debts knowing that he has not paid them, on a public document, is committing perjury and swindle.

    You should get in touch with the vendor, via the agent or your lawyer, to inform them of the debt, and give them a dealine for payment, after which you will take legal action. Also, you should inform your lawyer that the excuse of the power of attorney is not good enough, it defies logic, and that he may be held responsible for being negligent.


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