European court points out the bleeding obvious

The European Court of Justice yesterday ruled Spain’s eviction laws to be incompatible with EU law on unfair terms in consumer contracts.

The decision will give Spanish judges the power to rule on whether mortgage terms are unfair under Directive 93/13/EEC in mortgage enforcement proceedings. The courts will have more power to suspend evictions.

We all knew Spain’s eviction laws were unfair or at least extremely harsh. You can lose your home and be left a huge debt to boot. Granted, prior to the financial crisis, the laws weren’t a noticeable problem. People generally kept up with their mortgage payments. When they didn’t, market conditions meant that they weren’t left with a debt for life as well as an eviction order.

Since 2008, though, home repossession has become a social disaster in Spain. We saw it happening. We knew why it was happening. But no one—apart from the civil action groups who managed to physically stop a few eviction orders—did anything.

Two Spanish governments have made next to no changes to laws and procedures that President Rajoy yesterday admitted were antiquated. Really? So why didn’t you or your predecessor do anything about it?

The judges are happy. One of them said that they could now be more than just cobradores del frac—a unique Spanish invention for collecting debt that involves dressing up in a tuxedo and top hat to embarrass the defaulter into paying up.

So, Europe, thank you for pointing out the obvious and hopefully helping us to change what we have been powerless to change until now.

With courts like yours, we might even end up inviting you in to make all the decisions. Oh wait, we already did that. Well then, just let us vote in meaningful European elections, and we’ll all be friends again.

You can read the European Court of Justice’s ruling here.

News articles in English on the ruling: Salon, BBC.

Written by Rob Lunn

Rob Lunn is a freelance translator based in Spain. He translates from Spanish and Catalan into English and specialises in legal translation.

4 comments to “European court points out the bleeding obvious”
  1. They have Dr. Diablo in Venezuela. It’s pretty much the same as ‘el cobrador del frac’ but the guy is dressed as the devil and arrives in an antique car decorated accordingly. The “Dr” thing comes from the fact that in most Latin American countries anyone with a degree is called ‘doctor’, especially lawyers, and Dr. Diablo is supposed to be a lawyer.

    With regard to the law as such, I’m really happy the EU stepped in. As a banker, it has been really hard for me to understand how banks in this country would be so irresponsible as to offer loans for more than the value of the underlying asset. That is a banking no-no in any economic situation. And then the law penalizes the debtor for the the financial institutions’ mistake by leaving them with a huge residual debt after repossessing their homes.
    It seems that justice, although slowly, is finally showing its face around here.

    • Better late than never I suppose. Although it’s exasperating that Spanish politicians have managed to take no steps to stem the problem on their own for such a long time, despite the public pressure. Let alone not hold anyone accountable for the irresponsible behaviour you mention. Maybe we should send a few Dr. Diablos around to sort them out.

  2. Nice to see an article by an Englishman actually praising EU.

    Thanks for pointing this out Rob. I live in Germany and all we hear here is that the “Southerners” (ie, Italy, Spain + Greece) are all irresponsible and we are bailing them out with our hard-earned money.

    Little is being said about the fact that the banks are dealing with German money and that if Germany did not bail out the people their banks lent money to, they would themselves be bankrupt. So they are in end effect not bailing others out, but saving their skins and looking like saints….

    • Well, I’m not actually English. Luckily enough, it doesn’t seem to be against my genetic code as an Australian to praise the EU. Although, to be fair, I probably criticise the EU far more than praise it.

      And what you say is happening, except no one’s bailing out the homeowners who took out the loans; they’re just bailing out the Spanish banks the German banks lent the money to.

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