We are paying stupid community fees to make up for all those not paying!

What can we do?

Hi Emma-Louise,

I am a solicitor who lived in Spain. This article may assist you.

Community Fees-Why pay your neighbour’s Community Fees?

Specialist debt collection law firm, Welbeck Law LLP, based in London, has launched a specialist debt collection service to trace non paying community fee debtors.

“As a consequence of changes in European legislation it’s now possible for Communities to pursue UK based residents for Community fees”,  explains founding partner, Jeremy Boyle.

Jeremy says “My parents emigrated to Spain in the 1970’s. In those days Europe was a very large continent. However now even if the claimant Community is based in Spain we can sue the UK resident whether they are in England, Wales, Scotland or Ireland. You can run but you cannot hide!”.

In Spain many litigants complain about the time it takes a Community of owners to secure a judgment against the non paying resident.

“I have heard that the Spanish Courts have back logs of thousands of cases which cannot have been helped by the austerity measures and that it can take over a year apparently to obtain a judgment. In the UK however the procedure we use is much faster and an Order can usually be obtained within 30 to 60 days of lodgement of the court papers.”

One further frustration experienced by Abogados and the Administradores de Fincas in Spain is that even when they have a judgment, they cannot enforce it because the non paying debtor is in the UK and the Communities do not have the debtor’s UK address.

“That is not a major problem in the UK jurisdiction”, opines Jeremy Boyle. “We work with professional and fully licensed expert tracing agents who use modern technology to track down errant debtors. We had one case recently where the Community had almost given up trying to trace the debtor. The community administrator and their Abogado were thrilled when the debtor was traced to Birmingham and an offer to repay the ?6829 soon followed. I also think it helps that my firm is based in London and the debtors then realise that there is no where left to hide”.

The beauty is that you do not have to go through the Spanish legal system. If the debtor is resident in the UK he can be pursued through the UK courts which are much faster.

“It has always struck me as being fundamentally unfair that the neighbour who diligently pays their community fees on time and has budgeted their money wisely has to pay a higher amount because the UK resident is not paying their fair share”, adds Jeremy.

Today you can do something about the non paying debtors: bring this article to your President’s attention and contact Jeremy Boyle at Welbeck Law LLP whose contact details are: .(JavaScript must be enabled to view this email address) or visit http://www.welbectlawllp.co.uk Tel. +44 (0) 207467 3999. Welbeck Law LLP is authorised and regulared by the Solicitors Regulation Authority.

Sounds great, if the debtor is in the UK. Would be good to see something like this for all debtors, including locals who understand the system perfectly.

Hi Emma-Louise. I totally agree with your comment. Whilst we cannot use the same European law for local debtors at least if you bring my details to your President’s attention we can try and reduce the debts by pursuing the UK based debtors.

Community fee Blog comment-legal Process and Enforcement of a Court Order.

I agree the Spanish court system does appear to be under some pressure and in any event solicitors can represent communities in the English courts, so if the debtor is resident in the UK why use the Spanish legal system.

However when it comes to taking legal action and particularly enforcement action (i.e. after an order has been legally obtained) these are my observations.

In my view what you do not want is a “one glove fits all” approach.

You have to think prudently about which recovery method will fit that particular debtor.

For example if the debtor has a job you can always apply for an Attachment of Earnings order. This enables you to get the employer to pay you a percentage of the employee debtor’s wages on a periodic basis, to discharge the judgment.

A Third Party Debt Order will enable you in certain circumstances to freeze or intercept a debt due to the debtor. So if for example your neighbour has money in his bank account, you can legally freeze it and the bank may be ordered to pay that sum to you, the judgment creditor.

The debtor could also be threatened with bankruptcy. If a Bankruptcy Order is made the moment the order is made, the bankrupt’s property automatically vests in the Official Receiver or Trustee in Bankruptcy. It’s the Trustee’s job to realise assets and distribute funds to the debtor’s creditors. The treat of bankruptcy is often enough to persuade the debtor to pay up.

Finally, with an appropriately sealed court order, you can use the services of a High Court Enforcement Officer to remove certain goods from the debtor’s house. The only problem with the latter is that if the debtor has a job he may not be in when the High Court Enforcement Officer calls.

I think the other thing you might wish to consider is that we are talking about community fees and the correct enforcement action has to be chosen, sometimes delicately as these neighbours might be sitting around the pool together and they will not be pleased if some one has turned up without a court order knocking on their front door in the UK.

I also believe that such an action might constitute a breach of the Office of Fair Trading Regulations, and as a Solicitor of the Supreme Court I would certainly not condone such an action.

In fact it may also well be an offence under the Prevention of Harassment Act 1997

see?http://www.legislation.gov.uk/ukpga/1997/40/contents

See the following link for details on our web site for enforcement methods:

http://www.welbecklawllp.co.uk/Community-Fee-Enforcement

Please contact .(JavaScript must be enabled to view this email address) if you want a debtor pursuing through legal means by a Solicitor’s firm authorised and regulated by the Solicitors Regulation Authority and which also has Lexcel Accreditation from the Law Society.

I have never bothered posting but like to read the forums, but this just got to me.
Its always the same, its us what pay that suffer, as we always have to pay more to cover the defaulters.
I was amazed at the solicitor who said we dont want to be sitting round the pool together to find out that one of us has had the debt collector. Well, let me tell you I AM sat round the pool, it is hot sunny and over 30. If one of the people I am now drinking wth has not paid his fees (and the extra for the defaulters) then I want to be sat there in the sure and certain knowledge that back in the UK a debt collector is leaving messages at his house. In fact I insist on it. How dare he come and drink with me and not pay his way.
I was also a bit taken aback at having to find the correct option for the debtor. No, these are debtors, the only way is collect. Show me the MONEY. They are crippling our communities. Give us the MONEY.
Thats my lot. I will make sure our community goes with the debt collector. I’ll go back to just being a reader again.
Dave

Hi Guys,

Interesting reading.

How does one safeguard against this liability prior to acquiring a property ???

Thanks,

Andrea

Andrea007:

First things first:

When you decide to buy a property you must, among other “musts” obtain a certificate from the vendor (this will be issued by the administrator/manager of the residents’ association) stating that s/he, the vendor, does not owe anything in condominium service charges (cuotas de comunidad).

However, it would be very wise to also find out, at the same time, and before buying, what the financial situation is as regards debts and debtors in the housing develoment/building.  The vendor should have a list of debtors (morosos) and the amounts outstanding.  Reason: because these lists are brought up for discussion at AGMs and EGMs for those residents’ associations where there are debts, and the minutes should reflect the current state of affairs and decisions taken in that respect.  The vendor may well be reluctant to part with this information (in case you back out!), but that very reluctance will be a warning sign…
The AGM minutes will also state (or should) the budgeted expenditure for the incoming year, and this in itself will give you a good idea of what is going on.

Thus you will find out the overall debt by obtaining the information outlined above.  The minutes of the last meeting (again if debt is a problem) should give information as to what measures are being taken to address the problem and if the Chairman has been given powers to institute proceedings for debt recovery.  Unfortunately, the procedure can be lengthy, but sometimes the mere “name and shame” aspect can galvanize a debtor into settling his/her debt.

On well-run developments (or buildings) where the administrator, and the Chairman of the residents’ association, are on the case, there should be no untenable problem.  Much depends on the standard of the development and the residents who live there.

In passing, could I also recommend that you obtain a copy of the by-laws for the residents’ association (estatutos de la comunidad).  Any half-way decent RA / development will have a copy in English of these articles.

However, there are no sure-fire safeguards where an owner just bails out, doesn’t pay his/her service charges, and may simply disappear.  If the owner has gone bankrupt, or his/her property is about to be seized for mortgage or other debt, and s/he has debunked, then recovery of service charges debt may be difficult.  I suppose in the forced sale of a house/apartment the residents’ association would rank as a preferential creditor, but I wouldn’t be so sure.  Only a lawyer could provide best advice.

If the housing development or building where you think you might like to buy looks tatty and uncared for (grounds, plants, shrubs, paths, general cleanliness) then a red light should flash. 

Again, if you rent before you decide to buy you’ll get a feeling for what is going on in the housing development or building. 

Best wishes
Patricia
Hi Guys,

Interesting reading.

How does one safeguard against this liability prior to acquiring a property ???

Thanks,

Many thanks Campana.

Highly informative !!!

Cheers,

Andrea

Andrea…

Or, alternatively, buy a property away from the holiday home ghettos… ie., not on an urbanisation or apartment complexes.

I’ve read of people paying upwards of ?3,500 or ?4000 p.a in community fees for an apartment they visit perhaps twice or three times a year. When coupled with a mortgage the fees this makes holiday home ownership a very expensive proposition.

Just my opinion as a very tight cynical Yorkshireman with deep (empty) pockets and a wallet full of moths…

fb

And gentlemen… please be aware that you are treading a very tight line with your entries, bordering on Spam…

Self interested commercial links on this forum are not appreciated and are in breach of the forum rules on posting…

fb

Moderator / Admin.

I was just talking about this subject with a friend last night…
In her Urb there are several debtors, yet nothing is being done except to charge the rest more to cover the funds needed to maintain the Urb…
The only thing they do to punish the non-payers, is to withold a pool gate key…
I have come across this in other Urbs… they will not hand out a key unless you have fully paid your comm fees.
A small thing, but I am not too sure that it is going to make non-payers pay…

(In this instance is is a 98% Spanish populated Urb.. and the few that refuse to pay have large houses and live good lifestyles and it does not appear that they do not have the funds for it.)

I am sure I would be on the committee if I lived there, as I would not want to foot other peoples bills!

The majority of homes in Spain are not necessarily in a resort area, but they are on a housing development/residential complex or in an apartment building.  The word “urbanizaci?n” is Spanish. 
Therefore, they do have a residents’ association and service charges do apply.
Yes, one can avoid these charges by having a home out in the country somewhere, not on a development),  perhaps in a village…..

But, in general, service charges will apply.  On well-run developments debt should not be a problem.  Residents can be pursued for debt, and made to pay up.  In such cases the debtor has to pay not just the amount overdue, but also interest and costs.  Needless to say, it is a process, starting with payment notices (registered with recorded delivery), and then moving on to instituting proceedings.  A dim view is taken of those who do not pay their condominium/development service charges. 
Mickey-mouse measures like refusing the debtor the right to use the pool, for example, are just laughable.

Certainly, these annual charges are high on upmarket developments: places which have 24-hour security (this is expensive), barrier with reception area, very well-tended gardens and grounds, an excellent administrator (working in tandem with a small residents’ committee), a contingency (slush) fund, etc. etc.

Patricia

Yes Patricia ^.
I was confused why the committee would not take more serious action..
I ‘think’ my friend is refusing to pay the extra as it is someone elses debt!