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England and Wales High Court (Queen's Bench Division) Decisions
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Cite as:  EWHC 3120 (QB)
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QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL
B e f o r e :
| ROGER KEITH ADAMS
|ATLAS INTERNATIONAL PROPERTY SERVICES LIMITED
David Turner QC and Ben Smiley (instructed by Alberto Perez Cedillo) for Miguel Αngel Aroca Seiquer and Aroca Seiquer & Asociados SL
Hearing dates: 5, 6, 10, 11, 12, 13, 14, 17, 18, 19 and 21 October 2016
Crown Copyright ©
Mr Justice Lavender:
(1) Introduction and Parties
(1) Roger Keith Adams, a building contractor, and his wife, Sonia Louise Adams, from Devon. They agreed to buy a chalet in phase III of the Bosque de Las Lomas development. The Agent was Atlas.
(2) Ronan Patrick Dunning, the governor of works at a prison near Dublin. He agreed to buy a chalet in phase III of the Bosque de Las Lomas development. The Agent was Atlas.
(3) Stuart Granville Forrester, a retired management consultant and now part time driver, and his wife, Lynda Mary Forrester, from Porthcawl. They agreed to buy a chalet in phase II of the Bosque de Las Lomas development. The Agent was Atlas. (After they had moved into their chalet, it was found to have structural problems, and they agreed with Desarrollo to exchange it for another chalet in the Bosque de Las Lomas development.)
(4) Ronald Frederick Frost, a retired plumber, and his wife, Christine Frost, from South Yorkshire. They agreed to buy a property in the Bosque de Las Lomas development. The Agent was Atlas.
(5) John Edward Hope, a pipefitter, and his wife, Helen Elizabeth Hope, from Wallsend. They agreed to buy a chalet in phase III of the Bosque de Las Lomas development. The Agent was Iberian.
(6) Wendy Isobel Stubington, a housewife, from County Down in Northern Ireland. She agreed to buy two apartments in phase II of the Triana development at Colinas de la Zenia. The Agent was Atlas.
(7) Ian Whyte, a retired offshore construction manager, and his wife, Alison Margaret Whyte, a retired accounts assistant, from Aberdeenshire. They agreed to buy a chalet in the Colinas del Lago Fase development, but when this was not built they agreed instead to buy a chalet in phase III of the Bosque de Las Lomas development. The Agent was Atlas.
(8) Terrence George Williamson, an electrician, and his wife, Sharon Linda Williamson, from Sutton in Surrey. They agreed to buy a chalet in the Colinas del Lago Fase development, but when this was not built they agreed instead to buy a chalet in phase III of the Bosque de Las Lomas development. The Agent was Iberian.
(9) Stuart Winter and Andrea Cartwright, as personal representatives of their late parents, Edward and Beryl Winter. When I refer in this Judgment to the Claimants, I include the late Mr. & Mrs. Winter, who agreed to buy a chalet in phase III of the Bosque de Las Lomas development. The Agent was Atlas.
(3) Aroca Seiquer & Asociados SL, a Spanish company which provides legal services, and which accepts that it was retained by the Claimants in connection with the Properties. Between 1991 and 2010, it was known as Atlastax Internacional SL, and I will refer to it as "Atlastax."
(4) Miguel Αngel Aroca Seiquer ("Sr. Aroca"), a Spanish lawyer, who specialises in property transactions. He is (indirectly) one of the owners of Atlastax, as well as its director and employee. He did not personally meet any of the Claimants, save for one meeting in 2007 with Mr. & Mrs. Frost. There is a dispute as to whether the Claimants retained Sr. Aroca or Atlastax in connection with their purchases. As at trial, I will use the expression "Aroca" to refer to whichever of Sr. Aroca or Atlastax was retained by the Claimants.
(5) Aroca Seiquer & Asociados. It is now accepted that this was not a separate legal entity, but a trading name. Sr. Aroca and Atlastax claim that it was a trading name of Atlastax. The Claimants say that it was the trading name of Sr. Aroca.
(1) The proceedings against the Agents and Atlastax commenced on 26 July 2013, when the Claim Form in the first action was issued.
(2) The proceedings against Sr. Aroca commenced on 1 July 2014, when the Claim Form in the second action was issued.
(2) Claims and Issues
(1) In conspiracy:(a) Aroca conspired with the Agents, as a result of which the Claimants have lost the money which they paid for the Properties.(b) Either:(i) this claim against Aroca is not statute-barred, because of deliberate concealment (see section 32 of the Limitation Act 1980); or(ii) if this claim is statute-barred, the Claimants have a substitute claim against Aroca for negligence in failing to advise the Claimants to sue Aroca before the limitation period expired.
(2) In negligence or breach of fiduciary duty, in respect of the period before "completion":(a) The Claimants retained Aroca before "completion." This is disputed.(b) Aroca was negligent prior to "completion" in:(i) failing to warn the Claimants that there was no bank guarantee in place as required by Spanish law;(ii) failing to warn the Claimants that there was no proof that Desarrollo was able to pass on an unencumbered title;(iii) failing to advise the Claimants not to pay anything in the absence of such a bank guarantee and such proof; and(iv) failing to take reasonable steps to ensure before the purchase monies were paid that Desarrollo provided the required bank guarantee and had in place arrangements which meant that Desarrollo could pass an unencumbered title.(c) Aroca was in breach of fiduciary duty prior to "completion" by reason of the same failings, which resulted from Aroca either:(i) actively preferring the Agents' or Desarrollo's interests to; or(ii) allowing those interests to influence its performance of,its duties to the Claimants.(d) But for this negligence or breach of fiduciary duty, the Claimants would not have paid the whole of the purchase price. Aroca contends that in fact the Claimants, if they had received the advice which it is said that they should have received, would have paid the whole of the purchase price, but that they would have received good title to the Properties.(e) In relation to limitation, the Claimants again say that:(i) these claims against Aroca are not statute-barred, because of deliberate concealment (see section 32 of the Limitation Act 1980); or(ii) if these claims are statute-barred, the Claimants have a substitute claim against Aroca for negligence in failing to advise the Claimants to sue Aroca before the limitation period expired.
(3) In negligence or breach of fiduciary duty, in respect of the period after "completion":(a) The Claimants do not allege that more could have been done to pursue claims against Desarrollo.(b) Instead, the Claimants allege that Aroca was negligent on and after "completion":(i) in advising the Claimants that their title deeds would be issued within 6-8 or 7-9 months, and thereby wrongly advising that everything was in order;(ii) in failing to advise the Claimants that it was wholly uncertain whether registration would take place at all; and(iii) in failing to advise the Claimants that they had claims against the Agents or Aroca.(c) The Claimants also allege that Aroca was in breach of fiduciary duty by reason of the same matters.(d) The Claimants allege that they have lost the value of their claims against the Agents.(e) In relation to limitation, the Claimants again say that:(i) these claims against Aroca are not statute-barred, either because the relevant breach was committed less than 6 years before the Claim Form was issued or because of deliberate concealment (see section 32 of the Limitation Act 1980); or(ii) if these claims are statute-barred, the Claimants have a substitute claim against Aroca for negligence in failing to advise the Claimants to sue Aroca before the limitation period expired.
(3) Spanish Law
(1) Under Spanish law a purchaser's title to property is not perfected and is not valid against third parties until it has been registered.
(2) A preliminary contract for the purchase of property is known in Spanish law as "contrato privado" ("private contract").
(3) A reservation agreement is a type of private contract. It is advisable to instruct a lawyer before a reservation agreement is signed, so that he can check, inter alia, that the vendor owns the property and there are no charges over the property. (Sr. Aroca said that it was normal for a property purchaser in Spain, including a foreign national, to instruct a lawyer before signing any contract for the purchase of property. Sr. Aroca accepted that it was very risky for a purchaser to pay the purchase price without carrying out checks to see that the seller would definitely be able to pass a good title.)
(4) In the case of the purchase of property off-plan, it is advisable that, before a private contract (including a reservation agreement) is signed, and before any money is paid, the following should be checked:(a) that the land is registered in the name of the developer;(b) which individual or legal entity has legal capacity to sign the contract;(c) whether any charge exists over the land;(d) that the property enjoys the benefit of a building licence; and(e) whether insurance is in place to cover damage resulting from structural defects.(Sr. Aroca said that it was normal for a lawyer to carry out checks such as these before the purchase contract is signed. In particular, he said that checking for a mortgage is one of the first things he would do.)
(5) A preliminary sales contract, or contact of "arras," is a type of private contract which imposes penalties (such as the loss of the deposit paid by the purchaser) if either party withdraws from the transaction.
(6) It is crucial to have certainty that monies paid to the seller/developer are secure. In the case of an off-plan property this can be achieved by way of a bank guarantee. (Sr. Aroca was asked what a Spanish lawyer could do to protect his client, if the client's purchase contract required him to pay money in advance, to make sure that the seller could not mortgage the property before completion. He said that the only option was a bank guarantee.)
(7) Law 57/1968 of 27 July obliges developers who obtain money in advance from potential purchasers of property to guarantee the return of that money, plus interest, by means of a bank guarantee or contract of insurance. This will be cancelled once the "cedula de habilitabilidad", or certificate of habitability, has been issued. (I add that the second article of Law 57/1968 of 27 July provides as follows (in somewhat imperfect translation):"In contracts for transfer of the homes to which the first article of this provision refers where delivery is agreed to advance amounts, promoter must be [sic] expressly state:a) The assignor undertakes to return to the assignee the amounts received on account plus six percent annual interest if construction does not start or end within the agreed deadlines determined in the contract, or not the certificate of occupancy is obtained.b) Reference to the guarantee or insurance contract specified in the first condition of the previous article, indicating the name of the guarantor or insurance company.c) Designation of the bank or savings bank and the account through which it must deliver by the purchaser of the amounts committed had anticipated as a result of the signed contract.At the time of contract award will deliver the transferor to the transferee of the document proving the guarantee, and individualized referred to amounts that must be anticipated on account of the price.")
(8) On completion of a property purchase, the parties (either in person, or through an agent or lawyer acting pursuant to a power of attorney) execute an "Escritura de Compraventa" before a notary. This is the equivalent of a transfer under English law.
(9) This is normally the stage at which the purchase price is paid, the keys are handed over and any mortgage is repaid.
(10) The notary retains the original of the Escritura de Compraventa and produces the First Copy, which is presented to the Land Registry for registration.
(11) At the parties' request, the notary will advise the Land Registry of the completion. This will protect the purchaser from any charges which may be imposed on the property by the seller after completion.
(12) If the property is mortgaged, then, in order for the purchaser's title to be registered free of the mortgage, the mortgage needs to be repaid and a Deed of Cancellation of Mortgage executed before a notary and presented to the Land Registry.
(13) Once the purchase has been registered, no-one can acquire any rights over the property without the purchaser's prior consent.
(1) They would expect a competent Spanish property lawyer, if he knew that his client was proposing to pay over (but had not yet paid over) the final balance of monies before the sales deeds were ready for signing/notarisation, to advise his client, and that that advice would be to check:(a) the developer's financial position;(b) that the construction stages had been fulfilled pursuant to the contract;(c) that the monies were covered by bank guarantees;(d) that the parties were following the contract; and(e) that any other administrative licence was in place.
(2) They would expect a competent Spanish property lawyer, if he knew that his client had paid over the final balance of monies before the sales deeds were ready for signing/notarisation, to give the same advice to his client.
(1) 8 of the Claimants, namely:(a) Mr. Adams. When cross-examined, he appeared to be doing his best to answer the questions asked, insofar as he could recall, while accepting that he could not recall certain matters. A number of his answers, however, were phrased in terms of what would have happened.(b) Mr. Dunning. He answered the questions put to him clearly and directly. When they were pointed out to him, he was prepared to accept errors in his witness statement (as to the date of the Purchase Contract, or which letter had been signed by Sr. Aroca) and that his recollection might be at fault.(c) Mr. Forrester. He was both articulate and definite in his answers to questions asked. He was prepared to acknowledge an error in his witness statement when it was pointed out to him.(d) Mr. Frost. He frankly acknowledged that his memory was not very good. He also said that it was his wife who had handled the paperwork. He was asked about whether he read the Purchase Contract, but it was plain that he was not someone who could be expected to read and understand for himself the details of the contractual terms. He appeared to find the experience of giving evidence a difficult one, perhaps in part because of the emotions generated by this case, and said that he did not understand a number of the questions which he was asked. On the other hand, he had a clear recollection of certain matters, such as his meeting with Sr. Aroca in 2007.(e) Mr. Hope. He gave clear and direct answers to the questions put in cross-examination, accepting a number of matters put to him, and was careful to distinguish matters which he could and could not remember, and matters on which he was and was not sure.(f) Mrs. Stubington. She answered the questions asked in cross-examination in a clear and straightforward manner. She did on one occasion have to refresh her recollection from her witness statement, after giving a date from her recollection which cannot have been correct. When she couldn't remember things, she acknowledged this.(g) Mr. Whyte. When cross-examined, he answered the questions put to him in an open and direct manner. He was unable to explain one date in his statement: he had given 20 February 2003 as the date on which he sent their personal details to Aroca, but there was no disclosed document to confirm this.(h) Mrs. Whyte. In her short witness statement, she said that she confirmed the accuracy of her husband's statement. But it appeared in cross-examination that she did not remember some of the things which he said that he remembered. One of the few things which she added in her witness statement was to say said that she went to Aroca's offices on the date of "completion" to pay their fees. However, at trial, having found a bank document, she said that her statement was incorrect and that she did not attend Aroca's offices on that day.(i) Mr. Williamson. He gave his evidence in a clear and frank manner, accepting a number of points which were put to him in cross-examination without demur. As is natural, his memory of events was better than his memory of the detail of documents.
(2) Two other individuals who bought apartments at the Development:(a) Graham Ian Dawkins, who bought a property at Colina La Zenia through Iberian. When cross-examined, Mr. Dawkins answered questions in a clear and careful manner. Although on some points it appeared that he may have been speaking from reconstruction rather than recollection, he was generally careful to limit his answers to what he could remember.(b) Yvonne Joan O'Hara, who bought a property at Bosque de Las Lomas and who was the President of the Community of Owners at phase III of that development. She was asked very few questions in cross-examination.
(3) Two witnesses called by the Defendants:(a) Sr. Aroca.(b) Juan Bautista Martini Gil ("Sr. Martini"), who has worked as a manager for Atlastax since 2000.
(4) Two expert witnesses:(a) Ignacio Morillas-Paredes, called by the Claimants.(b) Alberto Canizares, called by Sr. Aroca and Atlastax.There was, as I have explained, a substantial measure of agreement between the expert witnesses. As a result, their oral evidence occupied only 40 minutes of court time.
(1) The Claimants had not retained complete records and kept their records relatively informally. Even then, they did not appear to have appreciated (or had brought home to them) the full extent of their disclosure obligations, with the result that they had not disclosed all of the relevant documents in their possession. Some of them referred to specific dates in their witness statements which are likely to have been taken from documents, but those documents were not disclosed. A number of the Claimants produced documents shortly before they gave evidence which had not been disclosed before.
(2) Sr. Aroca said that Aroca had a policy of destroying documents after 6 years. Sr. Aroca also said that in about 2006 Aroca had provided the Claimants' files to another firm of lawyers, Manresa & Rivas (to whom I will refer), which may explain why some other documents are no longer available.
(1) He gave evidence in Spanish, with the assistance of an interpreter, and I make allowance for that. He accepted that he spoke some English, and it was clear that he had some understanding of English. However, I was not persuaded that, as Mr. Frost had claimed, he spoke perfect English.
(2) Sr. Aroca was reluctant to accept many matters which were put to him. For example, he would not even accept that Iberian's brochure appeared to have been produced by Iberian. He denied that Aroca's standard letter (which I will refer to later as the "Dear Client" letter) was drafted for non-residents, even though it states, "Our aim is to protect, serve and provide you with security as a non-resident in our Country." He had to be asked several times before he accepted that Mr. & Mrs. Dawkins' contract provided for about 88,000 to be paid before they obtained title to their property. He made a statement on 19 February 2004 in which he said that "For a copy of this statement, you may refer to the Atlas International web site." However, he did not accept that he was aware, when he made this statement, that a copy of it would be placed on the Atlas International website.
(3) A number of Sr. Aroca's answers involved lengthy explanations, and he spent a great deal of time arguing his case. In part, this may have been the product of the frustrations caused by the process of giving evidence through an interpreter, in part it may have resulted from the natural desire of someone accused of conspiracy to defend himself, and in part it may, as he said, have been the product of his experience in a different legal culture. In some cases, however, it seemed that he protested too much. For example, I was not convinced by his denial that the name "Atlastax Internacional SL" was chosen in April 1991 because he and the other owner of Atlastax were already involved with a company with "Atlas" in its name, i.e. the insurance broking company then called Atlas Agencia SL. (I will deal later with the ownership of these and related companies.)
(4) Sr. Aroca often did not answer the question put to him, despite repeated reminders to him to focus on the question asked and to answer it. There were many examples of him making long speeches in response to a question, but failing to answer the question itself, even when repeated. For example, his repeatedly evasive responses to the question why he didn't tell his staff in 2004 to warn clients of the worries which he had about Desarrollo demonstrated what can only have been a wilful refusal to answer that question. His answers to questions about when he knew that the properties being sold by Desarrollo were mortgaged were non-responsive, at best. Given Sr. Martini's evidence that he knew that Desarrollo was cancelling mortgages when it signed Escrituras de Compraventa, I can only conclude that Sr. Aroca's answers on this topic were deliberately obfuscatory.
(5) Sr. Aroca's evidence on one point was shown to be incorrect by subsequent disclosure. The Claimants alleged, by reference to an invoice disclosed by Aroca, that Aroca had paid commissions to Atlas Mediterraneo SL in respect of the Claimants. Sr. Aroca denied that these payments were commissions, and also claimed that they had only been made for a short period, which he estimated at 2-3 months. But further disclosure showed that these payments had in fact been made over a period of at least 6 years, i.e. from 2002 to 2008. It is difficult to see how his original answer can simply have been a mistake. On the other hand, the further disclosure confirmed his evidence that he regarded these payment as payments for transport cost.
(6) Taking his evidence as a whole, I did not find Sr. Aroca to be a witness on whose unsupported recollection I could place any reliance.
(5)(a) The Marketing of the Properties
(1) if they bought a property through the Agents, the Agents would provide a service to them and would operate as a "one-stop shop" (or, in Mr. Dunning's words, provide a "turn-key solution"), helping with all of the requirements of people buying property in Spain; and
(2) the Agents recommended that the Claimants use Aroca as their lawyer. Mr. Williamson put it in this way:"Iberian told us at the start of the process that if we wanted to we could hire our own solicitor but things would progress more smoothly if we used their own very experienced firm of solicitors, [Aroca]."
(1) "ATLAS will be your partner in Spain. Now that you have purchased a property we will handle all aspects of your moving in process including insurance, bank accounts, furniture selection, setting up of water and electricity contract, resale and letting service if required. ATLAS will regularly report on the progress of your property and inspect your house on completion. Our offices in Spain with their multilingual staff are open six days a week to help and advise you with any information you may require.Our Client Service Centre provides a friendly, multilingual point of contact for our clients and acts on your behalf throughout the process until you move into your property.Our Mid Term Department will assist you with viewing your property at the mid-build range. Prior to your visit to Spain you can also make arrangements to meet with the solicitor, bank and even choose furniture in preparation for your completion and moving-in to your propertyOur Moving In Department will collect you from the airport or from your accommodation and take care of you through the complete process of moving in.ARCA Mobiliaro is a modern design based furniture company.ATLASTAX is the fiscal company specializing in all types of fiscal and legal representation for homeowners both resident and non-resident. They are experts in Tax and Residencia regulations and offer an "all in package".ATLAS INSURANCEATLAS PROPERTY MANAGEMENTATLAS RESALEAIB TECHNICAL "
(2) " If you require further or more detailed information on any of the subjects covered, please contact our Client Service Centre and we will do everything we can to assist you."
(3) "Our Client Service Centre the largest in Europe will process all relevant documentation related to your property and will maintain regular contact with the builder."
(4) "ATLASTAX are a group of professionals dedicated to serve, protect and provide sound Legal and Fiscal security to the non-resident in Spain.The main part of the completion is the conveyancing of the title deeds and for this you will need to visit the notary. Some clients may prefer to leave Power of Attorney which allows the legalities of the purchase to be carried out by the solicitor in your absence."
(5) "Solicitor's NotesIn principle, after signing a private contract for the purchase of a property and having made the payments, the next step is to sign a public document called an "Escritura de Compra Venta," the Title Deeds. ..When purchasing property in Spain, you should use professionals for your protection. ATLAS-TAX are a group of professionals dedicated to serve, protect and provide sound Legal and Fiscal security to the non-resident in Spain.In order to obtain the Title Deeds, the solicitor will require the Power of Attorney. This is useful if the purchaser(s) cannot be in Spain when the legal paperwork requires completion.THE TITLE DEEDSThe Title Deeds are signed at the offices of the Notary in the presence of the purchaser, the purchaser's solicitor, the vendor or builder (or the vendor's representative), and in the case of mortgage or other finance arrangement a representative from the bank, or finance company.In order for the solicitor to open your file and commence any work on the purchase of your property, you will shortly receive a form requesting the following details:Should you require any further information on these, or you do not receive the Solicitor Form within 6 months of your reservation, please do not hesitate to contact ATLASTAX."
"The person who is close to the buyers are the agents, , who have the same nationality as the people who buy. They are the people who are the masters of the advice that is given to the buyers and they take great care with the choice of the election of who to give, you know, for advice, for legal advice, who to take their clients to, but that election, that choice, is only theirs and these are people who are in charge of hundreds of people and these are people who wish to maintain their good name and reputation of their company. It is them, the ones who decide in total freedom where to send their clients."
(1) Half of the shares in Atlastax have been owned by Sr. Aroca (or, from April 2002, a company owned by him and his wife, Aka Costablanca SL).
(2) The other half of the shares in Atlastax were owned by Mr. Van Elmpt until 25 April 2002, when he sold them to Hause of Atlas SL, a company of which he was the ultimate owner.
(5)(c) Connections between Aroca and the Agents
(1) As I have explained, the shares in Atlastax were owned, as to one half by Sr. Aroca (either directly or indirectly, through Aka Costablanca SL) and, as to the other half, by Mr. Van Elmpt (either directly or indirectly, through Hause of Atlas SL).
(2) Atlas was incorporated in 1998. The shares in Atlas were all owned by Mr. James John Stockdale and his children. Mr. Stockdale was someone who had worked at Masa Internacional and knew Sr. Aroca when he worked at Masa Promociones. Mr. Stockdale and Mr. Van Elmpt owned and/or controlled a number of companies which gave powers of attorney to Sr. Aroca at various times.
(3) Atlas's Spanish agent, Atlas Mediterraneo SL, was incorporated in 1998.(a) Sr. Aroca said that it had been set up secretly as a competitor to Masa Internacional (which Mr. Van Elmpt left in 1998) because its owners were upset with Masa Internacional.(b) Between 1998 and 2003 the shares in Atlas Mediterraneo SL were owned in equal shares by Mr. James John Stockdale or his family and by Mr. Van Elmpt. In about 2003 Mr. Van Elmpt transferred his shares in Atlas Mediterraneo SL to Mr. James John Stockdale or his companies.(c) Atlas Mediterraneo SL's registered office was until 2003 the same as the address of Atlastax's offices in Torrevieja. However, Atlas Mediterraneo SL carried on business from a different address.(d) On 13 February 2001 Mr. Van Elmpt and Mr. James John Stockdale executed a power of attorney on behalf of Atlas Mediterraneo SL in favour of Sr. Aroca. (Sr. Aroca said that he couldn't remember this power of attorney or being told about it. He had many powers of attorney executed in his favour. However, I find that he knew about it at the time.)(e) Sr. Aroca denied that he was involved in running Atlas Mediterraneo SL, and I was shown no evidence of any steps taken by him to this effect.
(4) Iberian was incorporated on 25 October 2000. The shares in Iberian were owned as to 75% by members of the Stockdale family and as to 25%:(a) until January 2004, by Mr. Van Elmpt;(b) from 26 to 27 January 2004, by a company owned by members of the Stockdale family;(c) from 27 January 2004 to some time before November 2006, by Hause of Atlas SL; and(d) from that time onwards, by a company owned by members of the Stockdale family.(I do not accept Sr. Aroca's denial that he even knew, prior to 2006, that Iberian was sending clients to Aroca.)
(5) Iberian's Spanish agent, Costablanca Baleares, was incorporated on 11 February 2000. Until 2008, 10% of the shares in Costablanca-Baleares were owned by Sr. Aroca (or Aka Costablanca SL). The other shareholders were Mr. James John Stockdale, Mr. Van Elmpt and another. Sr. Aroca said that he did not participate in the running of Costablanca Baleares, but he was its "administrador" until about 2009.
(6) Atlas Torrevieja Correduria de Seguros SL was the insurance broker recommended by Atlas. It was incorporated on 19 February 1991, when it had the same registered address as Atlastax and was known as "Atlas Agencia SL," Mr. Van Elmpt having traded as an insurance broker under the name "Atlas Torrevieja Insurance Brokers" since 1979. Sr. Aroca was appointed as the "administrador" (i.e. director) of Atlas Torrevieja Correduria de Seguros SL when it started trading in 1991 or 1992, because he had a qualification as an insurance broker, and he has remained its "administrador" ever since. Sr. Aroca also owned 5% of its shares between 1991 and November 1994. Mr. Van Elmpt was initially the majority shareholder and has since November 1994 been the sole shareholder in Atlas Torrevieja Correduria de Seguros SL.
(7) ARCA Mobiliaro SL was the company recommended by Atlas as a supplier of furniture. It was established in 1997 and Mr. Van Elmpt was a shareholder. Sr. Aroca was its "apoderado" (i.e. someone to whom a power of attorney had been granted) until 2007.
(1) Atlas were imitating the modus operandi of Masa Internacional. Atlas knew how he worked because of his work for Masa Internacional clients.
(2) The man in charge of Masa Internacional, Mr. Gunaf Marssen, did not like Aroca taking clients from Atlas and told Sr. Aroca that he would stop sending clients to Aroca, which he did (albeit some of Masa Internacional's clients continued to choose Aroca). This shows both the power of agents such as Masa Internacional, Atlas and Iberian to influence the behaviour of clients and Sr. Aroca's awareness of that power.
"Obviously I can't refuse a company that brings me clients. I had 56 families to feed at that time, so I couldn't say: "No, no, don't bring me the clients."
(1) "Expression that the purchasers are conducting the operation "free of encumbrances"; and
(2) "construction guarantees" (identified as missing in one of the planning reports), as to which both of the planning reports stated (in translation) that:"it is highly advisable for potential clients to secure the sums paid on account by means of an appropriate policy to guarantee these amounts until the corresponding Certificate of Habitability is obtained."
(5)(d) The Reservation Forms
(1) signed an "Atlas [or Iberian] International House Reservation" form ("the Reservation Form"); and
(2) paid to the Agent part or all of the deposit (of 10% of the purchase price).
"This reservation will be cancelled in favour of the contract and in any case cancelled by date [and a date could be, and usually was, inserted]
This reservation is made on behalf of the builder and [Atlas/Iberian] remains exempt from any responsibility.
The deposit is not refundable but will be held to your credit on an alternative property with [Atlas/Iberian] should you cancel this purchase, for a period of 2 years.
Having read the above, the parties sign in agreement"
(5)(e) The Purchase Contracts
(1) Mr. & Mrs. Adams: 19 April 2004.
(2) Mr. Dunning: 12 August 2003.
(3) Mr & Mrs. Forrester: 16 July 2002 (with another contract on 23 April 2004 when they changed properties).
(4) Mr. & Mrs. Frost: 21 May 2002.
(5) Mr. & Mrs. Hope: 5 August 2003.
(6) Mrs. Stubington: 24 and 27 February 2003.
(7) Mr. & Mrs. Whyte: 16 November 2002.
(8) Mr. & Mrs. Williamson: 24 February 2003 (replaced on 2 April 2004).
(9) Mr. & Mrs. Winter: 3 April 2004.
"In the event that THE VENDOR would proceed to constitute a mortgage, considered as optional, on the properties object of this contract, the expenses and taxes generated by this mortgage loan shall be paid by THE VENDOR. For that purpose, THE PURCHASER hereby authorizes THE VENDOR to sign all the necessary documents for the formalization of the mortgage loan. In this case, THE PURCHASER shall subrogate to the mortgage loan on the date of execution of the public Deed of Sale."
Mr. & Mrs. Adams' and Mr. & Mrs. Winter's Purchase Contract contained the same provision in Spanish.
(5)(f) Communications between the Agents to the Claimants
"Congratulations on the purchase of your new home.
As an [Atlas] customer, it is our wish to make the purchase of your property as stress free as possible.
This is just a short note to introduce myself as your personal After-Sales advisor. I am here throughout the purchase of the property. Please find below an informative outline of the [sic] some of the services that we offer at Atlas International.
I would like to take this opportunity to remind you that all clients will require a bank account to be opened, this can be arranged through myself.
Should you need us to arrange a mortgage on your behalf, Atlas International in Spain will provide this service. For more information please contact me.
In regard to the legal aspects of your purchase, a letter with full details will be sent to you directly from your solicitors in due course. The letter will be from Aroca Seiquer & Asociados, although they have been instructed on your behalf you will need to confirm this instruction in writing to them. (you can send the letter of instruction via our office in Dorking.)
Your next payment of 40% should be due within the next month.
Within the next two months you will be receiving an Atlas International Administration charge. This charge is part of the additional 10% costs included in the information sheet you received within your brochure. This is a one off charge and the only payment of this kind that needs to be paid before your completion. This administration charge will cover various administrative duties that [Atlas/Iberian] will perform your behalf.
Assuring you of our best attention at all times."
"We would like to take this opportunity to congratulate you on the purchase of your new property, and thank you for the confidence you have displayed in ATLAS INTERNATIONAL in having elected to make your purchase with us. We can assure you that our team of professionals will continue working with the aim of assuring that everything runs smoothly during the purchase of your property.
We would also like to take this opportunity to inform you that your after sales representative in Spain is Juan Carlos Rubio.
To provide you with the appropriate service we ask you to always address the contact person mentioned for any doubts or queries you may have on your property.
Please do not hesitate to contact your representative should you require any further information or advice."
"We would like to take this opportunity to provide you with information on the other independent companies within the ATLAS Group who are also at your service should you require any information or advice regarding your company.
- ATLAS SOS Provides all types of extras to your property,
- ATLAS Insurance
- ATLAS Tax Founded in Torrevieja and specialising in legal and fiscal representation of home owners, resident and non-resident.
- ATLAS Property Management
- ARCA Furniture
Our Client Service Center can offer help to obtain quotations and follow up all the extras that your property requires.
Also so that your moving in process runs smoothly could you please complete the enclosed form asking for personal and bank details. This is required by the solicitor to ensure they have all the correct details on file so that they can prepare the relevant documentation for title deeds etc. It is also required for tax purposes. With this form we also require two passport photographs and another copy of your passport. "
"Firstly, I would like to congratulate you on the purchase of your new home.
As an [Atlas] customer, it is our wish to make the purchase of your property as stress free as possible.
This is just a short note to provide you with helpful information with regard to your initial payments and contracts.
If you have not paid your deposit payment yet, this payment should be made as follows:
[There followed details for making payment to Atlas.]
Please find below, an informative outline of the (sic) some of the services that we offer at [Atlas].
Atlas have a fully operational Client Service Centre, which is the largest overseas property centre in Europe. Here, they have implemented a large team of friendly, helpful and professional staff to answer any queries you have during the purchase process.
In regard to the legal aspects of your purchase, an informative introduction letter from Aroca Seiquer, a solicitors based in Torrevieja, Spain, will be sent to you directly. If you wish to use their services, you will have to send a letter of instruction to confirm your interest in their services, making sure to include your property details. You can them contact them directly with any further queries you would like them to handle. (The letter of instruction can be sent via our office in Dorking and we will forward it to Spain on your behalf.)
Solicitor contact details: Aroca Seiquer & Asociados (Abogados/Solicitors)
Your next stage payment (of 40%) should be due within the next month.
Within the next two months you will be receiving an [Atlas/Iberian] International Administration charge. This charge is part of the additional 10% costs included in the information sheet you received within your brochure. This is a one off charge and the only payment of this kind that needs to be paid before your completion. This administration charge will cover various administrative duties that [Atlas/Iberian] will perform your behalf.
Assuring you of our best attention at all times."
"In regard to the legal aspects of your purchase, we can recommend the solicitors based in Torrevieja, Spain, called Aroca Seiquer. If you wish to use their services, (or make further inquiries to them), you should send a letter of instruction to them confirming your interest in their services, making sure to include your property details. (The letter of instruction can be sent via our office here in Dorking and we will forward it to Spain on your behalf.)"
"We were told by Atlas to make contact with Aroca to engage their services for the legal aspects of our purchase."
"We would also like to take this opportunity to inform you that the Client Service Center in Spain will be more than happy to help you should you require any further information or advice. Please do not hesitate to contact us at email@example.com, "
"Further to your request for written confirmation about the bank guarantees for your payments I can confirm that after paying 50% (1st and 2nd payment) you will receive a bank guarantee either from the builder or Atlas International."
"We would like to take this opportunity to congratulate you on the purchase of your new property, , and to thank you for choosing the services of [Iberian] to help with the purchase of your new property.
We would also like to take this opportunity to inform you that the Customer Care in Spain will be more than happy to help should you require any further information or advice. .."
(5)(g) The Mortgages
(1) Mr. & Mrs. Adams: 1 July 2004.
(2) Mr. Dunning: 1 July 2004
(3) Mr & Mrs. Forrester: 23 May 2003.
(4) Mr. & Mrs. Frost: 1 July 2004.
(5) Mr. & Mrs. Hope: unknown.
(6) Mrs. Stubington: 28 October 2003.
(7) Mr. & Mrs. Whyte: 1 July 2004.
(8) Mr. & Mrs. Williamson: 1 July 2004.
(9) Mr. & Mrs. Winter: 1 July 2004.
(5)(h) Aroca's Knowledge and Concern
"13. In my experience, it is common practice for developers in Spain to finance the cost of building by mortgaging the overall plot of land where the properties are to be erected.
14. If, generally speaking, there are significant delays of several weeks or months on the developer's part in granting title deeds, any experienced Spanish lawyer specialised in conveyancing would suspect that either (a) there has been some difficulty when obtaining the certificate issued by the Town Hall stating that the properties are in full compliance with building regulations, preventing the above-mentioned deed to be signed, or (b) that the developer is having some degree of financial difficulty.
15. As far as I am aware, the properties which the Claimants ultimately acquired were built in full compliance with building regulations."
"26. Once the provisions of funds and the power of attorney were received, the developer was contacted by [Aroca] to determine a mutually convenient date to execute the purchase agreement free of charges and encumbrances before a notary. Time passed and the developer did not reply to our request to set a date for the signing. As time passed, my concern increased. Normally, a delay of one month was not unusual due to both notaries' and developers' workload.
27. From January 2004 I began to worry even more, since the developer was signing very few deeds. I was especially concerned that the properties met all the requirements of the Spanish land laws and developers still seemed unable to proceed with the redemption of mortgages. I spoke several times by e-mail with Daniel Sanchez and Emilio Martin de las Mulas, of [Desarrollo]."
(1) A fax dated 15 January 2004, marked Urgent, from Sr. Aroca to Mr. Sempere of Atlas Mediterraneo SL, with the heading "Registration Deeds with Desarrollo y Tecnologia", which stated (in translation):"Please find attached a list of the dwellings planned for registration with [Desarrollo]. We are having problems with the company in respect of these registration deeds (we have only been able to register four), in particular for those which have already been paid but for which the developer has yet to cancel the loan."(a) Sr. Aroca acknowledged that what he was referring to in this email was that Desarrollo was slow in executing Escrituras de Compraventa.(b) The list accompanying this email was a list of 35 clients, most of whom were buying properties at Bosque de Las Lomas. They included Mr. & Mrs. Forrester, against whose name appeared a "Yes", meaning that it would have been possible to register their Escritura de Compraventa, if it had been executed.(c) Sr. Aroca denied that this was the list accompanying his email, but it plainly was. He said that he was only assuming that there was a loan to be cancelled. I do not accept this. He obviously wrote in these terms because he knew that there were loans in place which needed to be cancelled. He also said that the problem was that Desarrollo had obtained a loan behind the clients' back, without obtaining their permission.(d) Mr. & Mrs. Forrester's name was 26th in the list. This suggests, and I find, that their "completion" came after the "completion" by many of the others listed.(e) Sr. Aroca said that if only one client was waiting to have his Escritura de Compraventa signed, that was for him already a high number. I find that many more than one Escritura de Compraventa was overdue for execution before the "completion" of Mr. & Mrs. Forrester's purchase on 17 October 2003.
(2) A fax dated 21 January 2004 from Sr. Aroca to Mr. Sempere, with the heading (in translation) "Registration Deeds with Desarrollo y Tecnologia," which read (in translation):"This is to remind you of the problems we encountered with [Desarrollo] regarding the registration of paid-for dwellings. Basically they allow us to register one or two houses a week. There is a backlog of clients awaiting registration, who are very frustrated and constantly ask about the status of their registrations. The problem arises from the fact that the houses are mortgaged and the mortgages must be cancelled in advance.I am available to assist in any way necessary to resolve this problem."
(3) Sr. Aroca signed a statement (in English) dated 19 February 2004 on the headed notepaper of "Aroca Seiquer & Asociados", which stated:"This statement is to confirm that Atlas International only sell products on Urbanized Land. The L.R.A.U. Law has no influence on these properties due to the fact that they are on urbanistic land which has been previously urbanized.Aroca Seiquer & Asociados, have specialized in Conveyancing for overseas clients for many years, based in Torrevieja and have many tens of thousands of clients including Atlas Clients. All of which have received their Title Deeds for both the house and the land.Aroca Seiquer & Asociados are a fully qualified and licensed firm of solicitors, with two large offices in the centre of Torrevieja. For a copy of this statement, you may refer to the Atlas International web site: www.atlasinternational.com.For specific enquiries you may email us at firstname.lastname@example.org and in a period of 48 hours you will receive a response from our urbanistic department."Mr. Sempere asked Sr. Aroca to produce this statement, to address a potential concern on the part of Atlas' clients (as a result of press reports) that there were planning issues with the properties being sold by Atlas. Sr. Aroca signed this statement (in English) and gave the statement to Mr. Sempere. I do not accept Sr. Aroca's denial that he knew that this letter was designed to be sent by Atlas to its clients. Sr. Aroca acknowledged in this statement that it would be placed on Atlas' website for all to see, including the Claimants and others in their position. He described it as a "letter of reassurance" and it was intended to provide reassurance to Atlas' clients, and especially Atlas's English-speaking clients, that if they bought property through Atlas, they would obtain their title deeds.
(4) A fax dated 1 April 2004 from Jane Rumsey of Aroca to Jim Stockdale, with the heading "Desarrollo y Tecnologia", which read:"We are writing with reference to the title deeds to be signed with the abovementioned builder.Please find attached a list of clients who are pending the signing of the title deeds with the said company.At present we have two agents of Atlas who are wanting to sell their properties, however have the problem that the [sic] do not own the property at the land registry offices.We would be obliged if you could assist in this matter as we need to sign more deeds on a regular basis."The attached list included 83 clients who were buying properties at Bosque de Las Lomas and other developments, including Mr. & Mrs. Forrester. They had "completed" on 17 October 2003, over 5 months earlier, and a mortgage had been registered against their property on 23 May 2003. Mortgages had by now also been registered (on 28 October 2003) against Mrs. Stubington's two Properties.
(5) A fax dated 24 June 2004 from Sr. Aroca to Jim Stockdale, with the heading "Desarrollo y Technologia", which read (in English):"We are writing with reference to the signing of the title deeds for properties purchased from [Desarrollo].We would advise that we have a very similar problem as that at Torrevieja 93, whereas we have approximately 45 clients which have a mortgage against the property which has not been cancelled for a sum of 60.000 each. All the properties have been paid for by our clients.The agreement that was made by the said company with our offices was for 8 title deeds to be signed per week. This is not being fulfilled as they are only completing 3 or 4 per week."(a) I reject Sr. Aroca's claim that the 45 clients referred to in this letter were clients in relation of "Torrevieja 93." It is plain from the terms of the letter that Sr. Aroca was referring to clients who were buying from Desarrollo and who had already paid the entire purchase price.(b) Moreover, this letter indicates that Aroca had spoken to Desarrollo about this problem, Desarrollo had proposed a timetable for resolving this, and Desarrollo had not observed that timetable.(c) Sr. Aroca said that he was worried by this and that he was worried about his clients. (Indeed, as I have said, it appeared to be his understanding that it was a criminal act for a developer, without the purchaser's permission, to mortgage a property which had already been sold.)(d) This was still before any of the Claimants, other than Mr. & Mrs. Forrester, had "completed" their purchases. (And only a week after Sr. Aroca sent this letter, on 1 July 2004, Desarrollo registered mortgages against the Properties of Mr. & Mrs. Adams, Mr. Dunning, Mr. & Mrs. Frost, Mr. & Mrs. Whyte, Mr. & Mrs. Williamson and Mr. & Mrs. Winter.)
(6) A fax dated 21 September 2004 from Sr. Martini to Desarrollo's "Registration Deed Dept.", with the heading (in translation) "Clients awaiting registration," which stated (in translation):"In accordance with the instructions of our clients, I urgently request a date for the signing of registration deeds for dwellings awaiting registration for which you have been fully paid.We will sign registration deeds free of encumbrances in respect of which, if there exists a prior mortgage, this must be cancelled by you before signature.I attach a report with the client and property names to assist you with client identification.We await your response to allow us to inform all our clients."Sr. Martini said that before he wrote this letter he had attended the signing of Escrituras de Compraventa by Desarrollo where there had been mortgages which he had seen being cancelled. By the date of this fax, all of the Claimants' properties had mortgages registered against them.
(7) A fax dated 24 January 2005 from Sr. Aroca to Luis Caminero of Desarrollo, with the heading (in translation) "Pending deeds", which stated (in translation) as follows:"Thank you for your fax dated 18/01/05 informing us of weeks and notary's office.Please let us know the date and time."
"17. As the date of the signature was repeatedly postponed by [Desarrollo], and as we eventually stopped receiving responses to our queries (as evidenced, for example, by [a fax of 30 March 2005] ), I became suspicious that the developer might have some financial difficulties and I informed the clients later that year.
18. This was an assumption on my part, which I made based on my experience. [Atlastax] did not have the Land Registry entry numbers of the Claimants' properties until approximately 2012, Therefore [Atlastax] was unable before that date to check whether these specific properties were subject to a mortgage or not.
19. I had around 160 clients due to complete the purchase of their properties on different developments owned by [Desarrollo] between 2003 and 2006. When the moment came to sign certain deeds and there seemed to be delays, I spoke to the builder who said that there were administrative problems which were delaying the deeds (which is a common reason for the delay of the signing of the deeds), but as the delays continued and I was not given specific reasons as to why, I started suspecting that the reasons were financial "
"I wanted to avoid creating unfounded concerns among those clients who had instructed me to sign the deeds, ."
(1) Sr. Aroca's evidence in relation to this statement was unhelpful and of no value. As I have said, he did not even accept that he knew that a copy of this statement would be put on Atlas's website, despite the fact that that is what he himself said in his own statement.
(2) The statement was clearly intended to reassure potential purchasers who were thinking of buying a property through Atlas, and I find that Sr. Aroca knew this.
(3) In particular, the statement reassured potential purchasers that if they bought through Atlas they would get their title deeds. That was the effect of the second paragraph. Again, I find that Sr. Aroca knew this.
(4) But the statement was silent as to Sr. Aroca's growing concern that purchasers who bought through Atlas might not get their title deeds. As a result, it was misleading.
(5) The fact that Sr. Aroca was prepared to make this statement at this time reinforces my conclusion that he took a deliberate decision not to tell (existing or new) clients about his concerns or the reasons for them.
"Q. You deliberately did not tell the clients that the problem with the deeds was that there was a mortgage on the property, right?
A. It's not true. What you are saying is not true. I would be infringing my professional capacity."
"If I knew what the problem was I would have told them straightaway."
(5)(i) Contact between the Claimants and Aroca before "Completion"
"Thank you for your recent correspondence, the contents of which we note.
AROCA Seiquer & Asociados have been established in Torrevieja since 1989.
Our aim is to protect, serve and provide you with security as a non-resident in our Country. In order to do this we have bi-lingual personnel to enable you to communicate in your own language thereby ensuring that your conveyancing transaction is dealt with efficiently and effectively from start to finish. AROCA Seiquer & Asociados are proud to act for approximately 7,000 clients in their fiscal obligations in Spain and will be pleased to represent you also.
To help clear up any queries you may have in respect of the system here in Spain, please find below a more detailed description of the services we provide:
So far as Conveyancing is concerned, all non-residents who purchase a property here in Spain have certain queries due to the difference in the conveyancing procedure from that of the UK.
Many question arise when purchasing a Spanish property, two of the most common are:
Q. Who protects me in the said purchase?
A. There is no obligation by the Spanish Government for a qualified person to carry out the conveyancing. However, we strongly recommend Solicitors should be used for your own protection.
Q. What are the total costs incurred in the transaction?
A. Notary Fees
Transfer Tax (known as Stamp Duty in the UK)
Land Registry Fees
Plus Valia Tax payable to the Town Hall
Conveyancing fees to AROCA Seiquer & Asociados
Assuming the value of the property is 120,000 Euros or above the percentage of the total costs payable is calculated at 4%
If the value of the property is 120,000 Euros or below, the percentage of total costs payable is calculated between 4% and 5%.
Prior to Completion of the House Purchase AROCA:-
* contact the builder to make an appointment to meet with both yourselves and the Notary in order that he can prepare the public document of purchase (the Title Deeds) following both the builder's and our instructions.
* contact the bank or intermediary to obtain the Certificate of Foreign Currency which records the purchase price and has to accompany the Title Deeds:
* conduct a search of the Land Register to check that:-
* the Seller owns the property;
* it is free from any mortgage;
* it is free of any charges or cautions.
The Title Deeds
Having signed a private Contract for the purchase of your property and
Having then paid the completion monies, you will need to sign the "Escritura de Compra Venta" (known in the UK as title deeds)
All Spanish Title deeds consist of:
* the date
* name of the Notary
* the Protocol Number (the number appointed to the property by the Notary)
* The Seller's name and address;
* The buyer's name and address;
* Address of the property;
* Charges section this is where the Seller states that the property is free from a mortgage or caution
* Local rates information.
The Escritura de Compra Venta is signed in the presence of yourself, the Seller and the Notary. The document then needs to be signed by the Municipal Administration as well as the Tax Authorities.
The deeds are then registered at the "Registro de la Propiedad" (known in the UK as the Land Registry).
The full process of registration in Spain takes around 6-8 months.
You will be notified once the Title Deeds are returned to these offices. The said document may then be collected together with a copy of a full breakdown of disbursements. In order to carry out this registration we do require the provision of funds due to cover our legal costs.
Once registered, the original copy of the Title Deeds is held in the Book of Protocol of the Notary.
You are provided with the first authorised copy you may either keep it yourselves or lodge it with us at AROCA for safekeeping on your behalf.
Assuring you of your best attention at all times
AROCA Seiquer & Asociados"
(1) Mrs. Stubington. She said that she received a letter from Aroca, but could no longer find it. I accept that she received the "Dear Client" letter.
(2) Mr. & Mrs. Winter. Mrs. Cartwright was not able to find many documents relating to her late parents' purchase. In particular, she did not disclose a copy of the "Dear Client" letter. However, since it was a standard letter sent to all of the other Claimants, I find on the balance of probabilities that Mr. & Mrs. Winter also received the "Dear Client" letter.
(1) Mr. & Mrs. Adams.(a) Mr. Adams told Atlas on 1 February 2004 that they wanted to use Aroca.(b) Mr. Adams was the only one of the Claimants to receive a copy of Sr. Aroca's statement of 19 February 2004.(c) On 19 June 2004 Mr. & Mrs. Adams wrote to Aroca a letter which said, "We would like you to deal with the purchase of the property [ ] on our behalf."(d) Aroca responded by sending the "Dear Client" letter, which was dated 30 June 2004 and addressed to Mr. & Mrs. Adams. It included the following additional paragraph:"We would like to take this opportunity to advise you that the lawyers fees for conveyancing are 1352 plus IVA, which includes your first years fiscal representation."(e) Mr. & Mrs. Adams had no further direct contact with Aroca before their completion trip.
(2) Mr. Dunning. It was not suggested that Mr. Dunning had any direct contact with Aroca prior to his completion trip.
(3) Mr & Mrs. Forrester. Mr. Forrester said that, shortly after receiving their Letter of Congratulations, and before receiving the "Dear Client" letter from Aroca, he telephoned Atlas and said that he and his wife wanted to instruct Aroca. He said that Alas told him that he need not send a letter. (This was not in his witness statement, and consequently it was challenged, but I accept that it was said.) Mr. Forrester did not claim that he contacted Aroca after receiving the "Dear Client" letter.
(4) Mr. & Mrs. Frost. They must have had some contact with Aroca before 17 September 2002, when Aroca wrote to thank them for their letter and attached copies of passports and requested information, and stated:"We would like to confirm that we have prepared your file ready for when you come to this office, at the time of completion; and we look forward to seeing you then. At the same time we would like to advise you that if you have any queries regarding this or any other matter, please do not hesitate to contact us."It appears, and I find, that Mr. & Mrs. Frost had completed the form enclosed with Atlas's letter of 27 June 2002 and sent this and copies of their passports to Aroca.
(5) Mr. & Mrs. Hope.(a) Mr. & Mrs. Hope received an undated letter on headed notepaper, from "Aroca Seiquer & Asociados", addressed to "Dear Clients" ("the short "Dear Clients" letter"), which read as follows:"We have been informed by [Iberian] that you have purchased a property is Spain, and we would first of all like to congratulate you on your choice of Torrevieja.After having signed the contracts, there are still some legal affairs to complete, and therefore we will here explain the Legal and Fiscal services we are offering you.a) The Conveyance: We will make the necessary searches from the start of the transaction to completion. We check special licenses, obtain the land registry note and other relevant documentation regarding the property. We inform and advise you on making various payments and we assist you together with a translator, when signing the Title deeds at the notary office.Our special package price for the mentioned services is of 691.16 plus V.A.T.We also offer a separate service in respect of the Fiscal obligations for Non Residents here in Spain.If you wish to take advantage of our services, or need further information or details, please do not hesitate to contact us by fax or at the address as detailed in the letterhead. We look forward to hearing from you."(b) Mr. Hope said that after they received the short "Dear Client" letter from Aroca, they did not contact Aroca direct because the Iberian brochure had said that they should only contact Iberian if they did not want to use Aroca as their lawyer.(c) Mr. Turner submitted that there was no communication by Iberian of an intent to instruct Aroca before Mr. & Mrs. Hope paid the final instalment of the purchase price, but it appears that Iberian did contact Aroca shortly before Mr. & Mrs. Hope's completion trip, as an entry in Aroca's client log dated 22 November 2004 reads:"Clients have conveyancing apt on Mon, 29/11/04 at 17:30h"(The log also records that the date and time of this appointment was changed on 23 December 2005.)(d) I find that a representative of Iberian contacted Aroca on 22 November 2004 on Mr. & Mrs. Hope's behalf and told Aroca that Mr. & Mrs. Hope wished to retain Aroca's services.
(6) Mrs. Stubington. She did not contact Aroca directly before her completion trip.
(7) Mr. & Mrs. Whyte.(a) They said that they asked Atlas to instruct the solicitor on their behalf, but there was no evidence that Atlas did so at this stage.(b) Mrs. Whyte completed the form provided to them by (it seems) Atlas and sent it to Aroca with copies of their passports. Aroca sent them a letter dated 4 March 2003 in the same terms as that sent to Mr. & Mrs. Frost on 17 September 2002.(c) In November 2003 (over a year before "completion") Mr. & Mrs. Whyte attended Aroca's offices and executed a power of attorney. The reason for doing this was that Mr. Whyte worked offshore and they feared that he might not be able to attend the "completion" in person. They subsequently requested (via Atlas) a copy of their power of attorney, and Aroca wrote to them on 26 August 2004 to send them a translation.(d) On 27 August 2004 Mr. & Mrs. Whyte signed the Purchase Contract for their replacement property. They did not notify directly Aroca of this change. Equally, however, they did not notify Aroca that this change meant that they no longer wanted Aroca to act for them.
(8) Mr. & Mrs. Williamson.(a) They did not contact Aroca directly before their completion trip. Mr. Williamson said that they told Iberian that they wanted to use Aroca.(b) Mr. Turner submitted that there was no evidence that Iberian did in fact instruct Aroca, but it appears that Iberian did contact Aroca shortly before Mr. & Mrs. Williamson's completion trip. Iberian sent a standard form dated 17 January 2005 to Aroca in relation to Mr. & Mrs. Williamson which identified their Property and asked Aroca to confirm their appointment for 16:30 on 26 January 2005.(c) Furthermore, an entry in Aroca's client log dated 19 January 2005 reads:"Clients have conveyancing apt on Wed 26/01/05 at 16:30h"(d) I find that Iberian contacted Aroca in January 2005 on Mr. & Mrs. Williamson's behalf and informed Aroca that Mr. & Mrs. Williamson wished to retain Aroca's services.
(9) Mr. & Mrs. Winter. There was no evidence that they contacted Aroca directly before their completion trip.
(1) that it was very risky to pay the whole of the purchase price without obtaining an Escritura de Compraventa;
(2) that Aroca was experiencing delays in obtaining the execution of Escrituras de Compraventa by Desarrollo;
(3) that the Property was or might be mortgaged; or
(4) that there was no bank guarantee in place.
"This confirms that the contract does fulfil all legal requirements and is okay to sign and return."
(5)(j) Arrangements for "Completion"
" The solicitor will require a set of two passport size photos and two photocopies of all persons named in the contract.
Please be aware that all persons named in the contract must sign the Title Deeds. If any of the persons named on the contract are unable to attend for the signature, they must then arrange with their Spanish Solicitor to provide Power of Attorney.
Please note that if you are using the services of any solicitor other than Aroca Seiquer & Asociados, you must contact them direct and advise them of your completion date and arrangements."
(5)(k) The Completion Trips
" I totally trusted Atlas and then their recommendation of Aroca and I just thought the whole thing would go ahead and everything would work out accordingly."
(1) went to see their Property;
(2) went to Bankinter (where the Agents had opened an account for them) to pick up cash and a banker's draft with which to pay Desarrollo and money with which to pay Aroca;
(3) attended Aroca's offices;
(4) attended a meeting with Desarrollo at which they handed over the cash and the draft and received the keys to the relevant Property and a receipt for their payment; and
(5) visited a notary's offices.
(1) Mr. & Mrs. Adams: 8 February 2005.
(2) Mr. Dunning: 2 February 2005.
(3) Mr & Mrs. Forrester: 17 October 2003.
(4) Mr. & Mrs. Frost: 24 November 2004.
(5) Mr. & Mrs. Hope: 29 December 2004.
(6) Mrs. Stubington: 29 July 2004.
(7) Mr. & Mrs. Whyte: 9 February 2005.
(8) Mr. & Mrs. Williamson: 26 January 2005.
(9) Mr. & Mrs. Winter: 23 February 2005. (This date was disputed, as I shall explain.)
"The problem arises from the fact that the houses are mortgaged and the mortgages must be cancelled in advance."
(5)(m) The Claimants' Meetings with Aroca
(1) What they had done, or were about to do, (i.e. paying the purchase price without receiving an Escritura de Compraventa) was not advisable and not normal.
(2) Either their Property was subject to a mortgage or Aroca had not carried out a search to check whether their Property was subject to a mortgage.
(3) The reason why Desarrollo had not executed, or was not proposing to execute, an Escritura de Compraventa was that the Property was mortgaged and that Desarrollo's financial circumstances meant that it was experiencing difficulties in clearing the mortgage off the Properties in time.
(1) A document in English on the headed notepaper of "Aroca Seiquer et Asociados", which stated:"IMPORTANT INFORMATION FOR OUR CLIENTSThis letter is to inform you that the process for the registration of your Title Deeds takes approximately seven to nine months depending on the Land Registry Office corresponding to your property.When the registration has been completed, the finalised Deeds will be sent to our Offices.Once this period has passed we would be grateful if you could inform us when you will be visiting our offices, so that we can prepare all the corresponding documents ready for your collection.Please note it is not possible for us to give any information while the Title Deeds are being registered, therefore we would be grateful for your patience during this period."Copies of this document were disclosed by Mr. & Mrs. Frost, Mr. & Mrs. Hope and Mr. & Mrs. Williamson.
(2) A statement of the amount to be paid by the relevant Claimant(s) to Aroca. This was headed "Provision of Funds of Legal Costs Calculated at 4% on a private Contract Price for a new Property". It stated, inter alia, as follows:"The estimated provision of funds covers all the following costs:-
- Notary fees
- Transfer Tax (Stamp Duty)
- Land Registry fees
- Plus Valia Tax paid to the Town Hall
- Conveyancing fee to AROCA Seiquer & Asociados .09% of the purchase price
- Administration chargeIMPORTANTPlease note that the final balance will be issued on receipt of the original title deeds duly registered which takes approximately 6-8 months to finalise. At this time, any surplus funds will be refunded."Copies of this document were disclosed by all of the Claimants except Mr. & Mrs. Hope and Mr. & Mrs. Winter, and I find that they too received a copy. In relation to this document:(a) In cross-examination, Sr. Aroca said that the conveyancing fee of 0.09% was the fee which Aroca charged:"when someone comes to get assistance or advice before they make the purchase price and then enables us to do the checks and everything that's involved in a transaction for the purchase of a building."When it was pointed out to him in re-examination that this amounted to a fee of only 103.43 in respect of one purchase (by Mrs. Stubington), he said that something must be wrong, but he was unable to give any further explanation.(b) The Claimants contended that the final section of this document conveyed the impression that there would be no problem with obtaining their title deeds. It certainly did not contain a warning to the Claimants that they might not acquire title to their Properties at all.(c) The Claimants contended that 6 to 8 months was an over-estimate of the time needed for the registration of Escrituras de Compraventa and that Aroca gave this over-estimate to allow for difficulties of the kind Aroca had experienced with getting Desarrollo to execute Escrituras de Compraventa.
(3) A receipt for the money which the Claimants paid to Aroca. This was on the headed notepaper of "Aroca Seiquer & Asociados."Such receipts were disclosed by all of the Claimants except Mrs. Stubington and Mr. & Mrs. Whyte, and I find that they too received a receipt and that all of them paid Aroca's fees. (The amounts paid are sent out in the Appendix hereto.)
(4) A document in English headed "What to do in the case of defects in your property." This was on the headed notepaper of "Aroca Seiquer & Asociados." It began by recommending that in the first instance property owners should contact "Atlas International," who "has a department dedicated to this matter."Mrs. Stubington received a copy of this document.
(5) A contract (in Spanish) for the provision of fiscal services ("the Fiscal Services Contract"). All of the Claimants signed such a contract. The parties to this contract were identified as the relevant Claimant(s) and "la firma de Abogado Miguel Αngel Aroca Seiquer" (which expression was translated, in the English version given to Mr.s Stubington, as "The Lawyer Miguel Αngel Aroca Seiquer") and the contract was signed (or to be signed) by the Claimants and by "Fdo. Abogado Miguel Αngel Aroca Seiquer." (The contract disclosed in Mr. & Mrs. Whyte's case identified the other contracting party as "la firma de Abogados Aroca Seiquer & Asociados y Atlastax, SL," but this contract was dated 2006 and so was not signed on their completion trip.)
(6) A document (in Spanish) designating Sr. Aroca as their representative before the Spanish Taxation Administration ("the Tax Administration authority").Such documents were signed by, at least, Mr. Dunning, Mr. & Mrs. Forrester, Mr. & Mrs. Hope, Mrs. Stubington and Mr. & Mrs. Williamson.
(7) A document authorising "Miguel Αngel Aroca Seiquer, (Atlastax S.L.)" to act for the Claimants in the payment of taxes ("the tax payment authority").Such documents were signed by, at least, Mr. Dunning, Mr. & Mrs. Forrester, Mr. & Mrs. Frost, Mr. & Mrs. Hope, Mrs. Stubington and Mr. & Mrs. Williamson.
(8) A form in Spanish addressed to Bankinter ("the Bankinter authority"), which authorised them to pay bills presented by "la firma del Abogado Miguel Αngel Aroca Seiquer, "Atlastax S.L."" for, inter alia (in translation):(a) "Bills for provision of funds for payments of the above-mentioned taxes paid by the Lawyer Miguel Αngel Aroca Seiquer."(b) "Bills for professional fees of the law firm [del Buffete del Abogado] Miguel Αngel Aroca Seiquer."Each of the Claimants signed such a form. (Mr. & Mrs. Whyte's and Mr. & Mrs. Winter's were not disclosed, but I find that they each signed one.)
(9) Possibly, a document in English headed "Fiscal Representation with Atlastax International S.L." This was on the headed notepaper of "Aroca Seiquer & Asociados." Mrs. Stubington was the only Claimant to disclose a copy of this document. Mr. Knox suggested that it was given to her on her completion trip, although there was no evidence to this effect.
(1) Mr. & Mrs. Adams.(a) They visited Aroca's offices on 8 February 2005, when they signed: (i) Aroca's contract for the provision of fiscal services; and (ii) the form addressed to Bankinter. Mr. Turner accepted that this could have been before they visited Desarrollo's offices.(b) Mr. & Mrs. Adams visited Aroca's offices again on 10 February 2005. That was the date of their receipt for the money paid to Aroca. It was also the date on which they were taken to the notary's office and executed their power of attorney.(c) I find that Mr. & Mrs. Adams visited Aroca's offices before they attended the "completion" meeting with Desarrollo. Mr. Adams had a vivid recollection of siting in Aroca's office with the cash to be paid to Desarrollo in his pocket, between himself and his wife. This was a telling detail.(d) There was an issue as to the date on which the "completion" meeting took place. Desarrollo's receipt for the final instalment of the purchase price was dated 8 February 2005 and the list attached to Atlas Mediterraneo SL's invoice of 31 March 2005 gave that date as well, seemingly as the date of "completion." Mr. Adams, however, said that he recalled that "completion" was delayed because of problems with the Property which he identified on the first day of his completion trip, i.e. 8 February 2005, and must have taken place on 10 February 2005. However, there was an element of reconstruction in this evidence and I prefer the evidence of the contemporary documents that the "completion" meeting took place on 8 February 2005.
(2) Mr. Dunning.(a) Mr. Dunning visited Aroca's offices on 2 February 2005, when he signed: (i) Aroca's contract for the provision of fiscal services; (ii) the document concerning representation before the Spanish Tax Administration; (iii) the document authorising "Miguel Αngel Aroca Seiquer, (Atlastax S.L.)" to act for them; and (iv) the form addressed to Bankinter. Mr. Turner accepted that this could have been before Mr. Dunning visited Desarrollo's offices.(b) Mr. Dunning visited Aroca's offices again on 3 February 2005. That was the date of his receipt for the money paid to Aroca. It was also the date on which he was taken to the notary's office and executed his power of attorney.(c) I find that Mr. Dunning visited Aroca's offices before he attended the "completion" meeting with Desarrollo. Mr. Dunning recalled going to Aroca's offices before he attended the "completion" meeting, and that is consistent with the contemporary documents.(d) There was an issue as to the date on which the "completion" meeting took place. Desarrollo's receipt for the final instalment of the purchase price was dated 2 February 2005 and the list attached to Atlas Mediterraneo SL's invoice of 31 March 2005 gave that date as well, seemingly as the date of "completion." 2 February 2005 was also the date on which Mr. Dunning withdrew the money to pay Desarrollo and Aroca. Mr. Dunning's evidence was that "completion" took place on the following day, but I prefer the evidence of the contemporary documents that the "completion" meeting took place on 2 February 2005.
(3) Mr. & Mrs. Forrester.(a) Mr. & Mrs. Forrester visited Aroca's offices on 17 October 2003, when they signed: (i) Aroca's contract for the provision of fiscal services; (ii) the document concerning representation before the Spanish Tax Administration; (iii) the document authorising "Miguel Αngel Aroca Seiquer, (Atlastax S.L.)" to act for them; and (iv) the form addressed to Bankinter.(b) Mr. & Mrs. Forrester visited Aroca's offices again on 27 October 2003. That was the date of their receipt for the money paid to Aroca. It was also the date on which they were taken to the notary's office and executed their power of attorney.(c) Mr. & Mrs. Forrester's "completion" meeting was on 17 October 2003, which was the date of Desarrollo's receipt for the final instalment of the purchase price.(d) I find that on 17 October 2003 Mr. & Mrs. Forrester visited Aroca's offices before they attended the "completion" meeting with Desarrollo. That was Mr. Forrester's evidence, which was unshakeable, and it is consistent with the contemporary documents.
(4) Mr. & Mrs. Frost.(a) I find that Mr. & Mrs. Frost visited Aroca's offices on 24 November 2004, when they signed: (i) Aroca's contract for the provision of fiscal services; (ii) the document authorising "Miguel Αngel Aroca Seiquer, (Atlastax S.L.)" to act for them; and (iii) the form addressed to Bankinter.(b) Mr. & Mrs. Frost's "completion" meeting was on 24 November 2004, which was the date of Desarrollo's receipt for the final instalment of the purchase price.(c) Mr. & Mrs. Frost visited Aroca's offices again on 2 December 2004. That was the date of their receipt for the money paid to Aroca. It was also the date on which they were taken to the notary's office and executed their power of attorney.(d) Mr. Frost did not have a clear recollection of their meeting with Aroca on 24 November 2004 and, in particular, whether it took place before or after the "completion" meeting. Indeed, he could not remember where certain documents were signed. Consequently, I am not satisfied that they visited Aroca's offices before they paid the final instalment of the purchase price.
(5) Mr. & Mrs. Hope.(a) Mr. & Mrs. Hope's "completion" meeting was on 29 December 2004, which was the date of Desarrollo's receipt for the final instalment of the purchase price.(b) Mr. & Mrs. Hope visited Aroca's offices on 29 December 2004, when they signed: (i) Aroca's contract for the provision of fiscal services; and (ii) the form addressed to Bankinter.(c) Mr. & Mrs. Hope visited Aroca's offices again on 30 December 2004. That was the date of their receipt for the money paid to Aroca. It was also the date on which they were taken to the notary's office and executed their power of attorney.(d) Mr. Hope's evidence was that they were taken to Aroca's offices after the "completion" meeting. That is consistent with the contemporary documents and consequently I find that Mr. & Mrs. Hope did not attend Aroca's offices until after they had paid the balance of the purchase price.
(6) Mrs. Stubington.(a) On Tuesday 27 July 2004 Mrs. Stubington attended the notary's office and executed a power of attorney in favour of Aroca. At trial, she could not recall visiting Aroca's office on this day, but she made a handwritten note on a letter from Atlas (dated 26 July 2004) which read "12.30 AROCA Notary ) Tuesday." It is relevant to note that: (i) other Claimants who attended the notary's office went to Aroca's office first and were then escorted to the notary's office; (ii) the power of attorney was a legal document which would have been prepared by Aroca; and (iii) Aroca's client log for Mrs. Stubington contains an entry dated 26 July 2004 which reads, "poa booked for 27.07.04 12.30 pm booked with carrie.". On the balance of probabilities, I find that Mrs. Stubington attended Aroca's office on 27 July 2004. In any event, Aroca were informed that Mrs. Stubington would be doing so.(b) Mrs. Stubington's "completion" meeting was on 29 July 2004, which was the date of Desarrollo's receipt for the final instalment of the purchase price.(c) Mrs. Stubington visited Aroca's offices on 29 July 2004, when she signed: (i) Aroca's contract for the provision of fiscal services; (ii) the document concerning representation before the Spanish Tax Administration; (iii) the document authorising "Miguel Αngel Aroca Seiquer, (Atlastax S.L.)" to act for them; and (iv) the form addressed to Bankinter.(d) Mrs. Stubington's receipt for the money paid to Aroca was dated 13 August 2004.(e) At trial, Mrs. Stubington could not remember the order of events on 29 July 2004. In her witness statement, she put the "completion" meeting before her visit to Aroca's offices. Accordingly, I find that on 29 July 2004 Mrs. Stubington did not visit Aroca's offices until after she had paid the balance of the purchase price.
(7) Mr. & Mrs. Whyte.(a) Mrs. Whyte went on the completion trip alone, as Mr. Whyte was working. The "completion" meeting was on 9 February 2005, which was the date of Desarrollo's receipt for the final instalment of the purchase price, and the list attached to Atlas Mediterraneo SL's invoice of 31 March 2005 gave that date as well, seemingly as the date of "completion."(b) On 9 February 2005 Mrs. Whyte instructed Bankinter to pay the money requested by Aroca. She said in her statement that she went to Aroca's offices and was given the Provision of Funds document, but she put this after the "completion" meeting. At trial she had no recollection of this. I find that on the completion trip Mrs. Whyte did not attend Aroca's office before she paid the final instalment of the purchase price.(c) Nor did Mrs. Whyte attend the notary's office on the completion trip, since she and her husband had already executed a power of attorney.
(8) Mr. & Mrs. Williamson.(a) There was an issue as to the date of Mr. & Mrs. Williamson's "completion" meeting, but no issue as to the sequence of events on that day, which, according to Mr. Williamson, was as follows:(i) Mr. & Mrs. Williamson attended Aroca's offices briefly.(ii) They then went to Desarrollo's offices for the "completion" meeting.(iii) They then returned to Aroca's offices.(b) As for the date of Mr. & Mrs. Williamson's meeting with Aroca, I have already mentioned the evidence that their meeting was arranged for 26 January 2005.(c) Mr. Williamson's evidence was that the completion meeting must have taken place on 28 January 2005 because they only spent one night in the Property before leaving Spain on 29 January 2005. However, 26 January 2005 was the date not only of Desarrollo's receipt for the final instalment of the purchase price, but of a number of documents signed by Mr. & Mrs. Williamson, i.e.: (i) Aroca's contract for the provision of fiscal services; (ii) the document concerning representation before the Spanish Tax Administration; (iii) the document authorising "Miguel Αngel Aroca Seiquer, (Atlastax S.L.)" to act for them; and (iv) the form addressed to Bankinter, all of which must have been signed when Mr. & Mrs. Williamson returned to Aroca's offices after the "completion" meeting. Accordingly, I find that the "completion" meeting took place on 26 January 2005.(d) Mr. Williamson's evidence as to their initial visit to Aroca's offices was that they were taken there by their Iberian representative, who had a discussion with someone from Aroca in Spanish and then told Mr. & Mrs. Williamson that Aroca hadn't got time to see them then.
(9) Mr. & Mrs. Winter.(a) I find that Mr. & Mrs. Winter attended Aroca's offices on 21 February 2005, when they signed Aroca's contract for the provision of fiscal services.(b) I find that Mr. & Mrs. Winter attended Aroca's offices again on 22 February 2005. That was the date of their receipt for the money paid to Aroca. It was also the date on which they were taken to the notary's office and executed their power of attorney.(c) It is less straightforward to determine the date of Mr. & Mrs. Winter's "completion" meeting, since no copy was disclosed of Desarrollo's receipt for the final instalment of the purchase price.(i) On the one hand, the list attached to Atlas Mediterraneo SL's invoice of 31 March 2005 gave the date of 21 February 2005, seemingly as the date of "completion."(ii) On the other hand, Mr. & Mrs. Winter's bank statement indicates that, whereas they withdrew the cash to pay Aroca on 21 February 2005, they did not withdraw the cash and obtain the bank draft to pay Desarrollo until 23 February 2005. (The amount of the bank draft matched the amount requested in their "Final Liquidation" statement. The amount of cash withdrawn was 2,000 euros less than the amount requested, but no doubt still represented the bulk of the cash to be paid to Desarrollo. The date in the first column was partly obscured, but appeared to be 23 rather than 21 February. The date in the second column was 23 February, and it would be odd if a cash withdrawal had a value date other than the date of withdrawal.)(d) On the balance of probabilities, therefore, I find that Mr. & Mrs. Winter's "completion" meeting was on 23 February 2005.
(5)(n) Mr. & Mrs. Forrester's Exchange of Properties
(1) Mr. Forrester's evidence, both in his statement and at trial, was that they saw Aroca before signing the Exchange Contract and that they discussed the proposed exchange with Aroca. He said that he told Aroca that he would be prepared to exchange provided that there were no problems with the new Property in terms of costs, debts or any other charges, having paid fully for the original Property. He also said that it was his understanding that Aroca had discussed the situation with Desarrollo and Atlas before they signed the Exchange Contracts. He recalled the telling detail of being in a meeting with Atlas when a telephone call was received from someone (he couldn't remember who) at Aroca who said that Desarrollo were happy to exchange the house at no extra cost.
(2) The sequence of events leading up to Friday 23 April 2004 was not entirely clear. Mr. Forrester said that he flew to Spain on Monday 19 April 2004. At trial, he said that he was "trying to piece the week" together. On that basis, he said that he saw Aroca on Wednesday 21 April 2004. However, that obviously involved an element of reconstruction.
(3) Mr. Forrester sent a letter to Deasarrollo which appears to have been sent on Thursday 22 April 2004, in which he complained about the state of the original Property and asked Desarrollo to repair it. In the letter, he did not refer to Aroca by name. Instead, he said that he had engaged the services of "a Corporate Property Lawyer." He said that he wouldn't have described Aroca as a Corporate Property Lawyer, but that he hadn't instructed anyone other than Aroca.
(4) Aroca's client log contains the following entry, by "Susan", which is dated 23 April 2004 and timed at "0:00:00:""client came with concerns over the damage to property. He is bringing photographs. Clients concerns are in writing and have been passed to Helena to translate."
(5) One cannot tell from this entry whether it relates to a meeting before or after the Exchange Contract was signed. However, it seems less likely that "Susan" would have written in these terms if by the time they met the problem had already been resolved by the parties entering into the Exchange Contract. On balance, therefore, the entry supports Mr. Forrester's evidence that he spoke to Aroca before entering into the Exchange Contract.
(6) On the other hand, the entry does not refer to the proposed exchange of Properties. However, I am cautious about drawing inferences from absences from this client log without having heard evidence about the system for compiling these records. For example, the client log for Mr. Dunning includes no entries before 22 February 2006, and the client log for Mr. & Mrs. Williamson does not contain an entry for their meeting on 26 January 2005.
(5)(o) Aroca's Dealings with Desarrollo
(1) A fax dated 2 March 2005 from Sr. Martini to Sr. Caminero, with the heading (in translation) "Pending deeds", which stated (in translation) as follows:"As several days have now passed since the date on which the pending documents should have been signed in the office of notary Juan Velez (as per your notice for signature) and these have not been signed as you were unable to attend, we are requesting an immediate new date for signing or information from you on this matter."Again, therefore, Desarrollo had said that it would sign Escrituras de Compraventa on a certain day, and had then failed to carry that out.
(2) A fax dated 30 March 2005 from Sr. Aroca to Emilio Martin of Desarrollo, with the heading (in translation) "Pending deeds", which stated (in translation):"Several weeks have now passed since the date on which the pending deeds should have been signed in the office of notary Juan Velez as arranged in response to our request for notarization, and these have not been signed as your company did not attend.We would like information on why you did not sign these documents."
(3) A fax dated 20 April 2005 from Sr. Aroca to Emilio Martin, the administrador of Desarrollo, with the heading (in translation) "Pending deeds", which stated (in translation):"In accordance with what was said at the meeting with you in your office on 14/04/05, we are awaiting your fax with the documents and information relating to the resolution of the problem with the pending deeds."Sr. Aroca's evidence was that he did not draft or send this fax. He said that it was common practice for Aroca's junior staff to send out correspondence under his name which he had not written. However, he accepted that he went to the meeting on 14 April 2005, having requested a meeting at the top level because he had a problem.
(4) A note dated 22 April 2005 on Aroca's client log for Mr. & Mrs. Frost, which stated that Desarrollo failed to appear before the notary, which was presumably the day nominated for executing Mr. & Mrs. Frost's Escritura de Compraventa.
(5) A fax dated 25 April 2005 from Sr. Aroca to Mr. Sempere, with the heading (in translation) "Technology clients," which stated (in translation):"I am sending you herewith the latest documentation received last Friday from [Desarrollo]. The information relates to the Colinas de Vistarosa development in Algorfa.I have received several calls from Luis Caminero asking when you would notify client for handover."
(6) A fax dated 11 November 2005 from Sr. Martini to Sr. Martin, with the heading (in translation) "Registry information", which stated (in translation):"We seek to avoid the mortgages held by your company being foreclosed and subsequent public auctioning of these in favour of the financial institution, to the consequent detriment of our clients who have paid you for them in full. For this reason we are asking you to provide us with the individual registry details for our clients' properties and also, for each one, the latest instalment paid to the bank.We have to inform our clients in case they wish to take on this instalment.We have to inform the bank that our clients are the current owners and possessors, so that they can notify us of the action being taken."
(1) Aroca sent a letter dated 25 May 2006 to (at least) Mr. Dunning, Mr. & Mrs. Forrester, Mr. & Mrs. Frost, Mrs, Stubington, Mr. & Mrs. Whyte and Mr. & Mrs. Williamson. The letter stated:"This firm of Solicitors together with your agents, since 2005 have been trying to obtain a solution from [Desarrollo].After many, many months of negotiations without success, your agents instructed Garrigues Legal (one of the largest legal firms in Europe) to act in conjunction with this firm to protect your interests.We are pleased to report that a settlement has been arranged to ensure Title Deeds are issued over the next 12 to 14 months.This arrangement has been made with [Desarrollo], and includes financial guarantees in the event they do not keep to the terms of the settlement.The deeds will be issued in groups, with predetermined dates and in your particular case the date given is [a date in 2006 or 2007 was inserted].As we are in possession of your Power of Attorney, there is no need for any action on your part.We would confirm that there are no additional costs for you in this case.We are sorry for the inconvenience you have suffered and we look forward to a smooth conclusion of this case."
(2) On 20 July 2006 Aroca sent an email to Mrs. Stubington which said:"There is now no problem with the builder and the signing of the Title Deeds. There was a problem which was resolved through the court system.Due to no deeds been [sic] by this builder during this process there is now a backlog of deeds to be signed hence the date in January for your deeds to be signed."
(3) Desarrollo failed to attend an appointment on 15 March 2007 to sign Escrituras de Compraventa for, amongst others, Mr. Dunning, Mr. & Mrs. Hope and Mr. & Mrs. Whyte.
(4) On 16 March 2007 Aroca sent an email to Mrs. Stubington which read:"When the matter with this builder was resolved in April 2006 he was obliged by the courts to provide a schedule of signings for the deeds to all its outstanding properties.He was also obliged to provide collateral in the event that in the time of the signings he did not have sufficient liquid assets to pay the mortgage on the land and sign the deeds debt free.It has transpired that at the time of the signings that he did not have the liquid assets and as such the matter has now been returned to the courts to secure the release of the collateral.Once this has been released it will be sold and the proceeds used to pay the mortgages and allow the deeds to be signed debt free.We do not know how long this process will take."
(5) Aroca sent a letter dated 14 August 2007 to each of the Claimants which stated:"We are writing with reference to the purchase of your property by means of a private purchase document signed with [Desarrollo] to inform you of some good news regarding the mortgage the builder registered against the property.[Desarrollo] has agreed before a Public Notary that they will lift the mortgage and have provided financial guarantees by way of property in the event of the mortgage not being lifted.To complete these guarantees the owner will have to attend the notary to sign the agreement. Our team of translators will assist you with this. Please contact us to make the necessary arrangements.We consider this an important step towards a solution in respect of the lifting of the mortgage on your property."
(6) Aroca sent a letter dated 10 June 2008 to a number of the Claimants, which said:"We would, firstly, like to reiterate that we have been working in your best interests with regard to your property in Spain.We are aware that [Desarrollo] have a mortgage on your land which is not an unusual practice for construction in Spain and we have been bringing all possible pressure upon them to resolve the situation in the best way for our clients.On April 6th 2006, [Desarrollo] signed a documentation which they confirmed that they would sign deeds on 15th of each month between September 2006 and September 2007. In order to sign the deeds free of debt they would at that time cancel all mortgages and this would be checked by our office and also the Notary. To guarantee this [Desarrollo] had to offer collateral and did so with assets at La Coronalite and Las Lempilas.We arranged appointments with the Notary in accordance with a schedule of signings however on each occasion the constructor failed to attend. On these occasions we signed a formal document before the Notary which confirmed our attendance and the absence of the Constructor. This document can be used later in Court proceedings, if required.On 31st July 007 a meeting was convened between Atlas International, [Desarrollo] and representatives of the banks who had provided the mortgages. [Desarrollo] sold the 2 aforementioned assets to another constructor thus releasing funds to [Desarrollo] to be used for the payment of the mortgages, however the contractor who purchased these assets is making the payments in 2 instalments, the first being 27th January 2009 and the second 27th January 2010.At the current time there are 2 courses of action that can be can be taken. Firstly, the time for the payment to lapse or alternatively proceed with action in the court system.Our recommendation is for the latter course of action.If you would like to advise convenient dates when you will be available in Spain we would be pleased to make an appointment for you with a solicitor who is fully versed on the situation, who can explain fully to you and advise the further processes to secure your Title Deeds."
(1) On 1 December 2005 Mr. Forrester wrote as follows to Seniora Javaloyes of Aroca:"I understand from Susan Sandoe [of Atlastax] that you are experiencing problems attaining the title deeds of 200+ properties built by [Desarrollo] including ours,You can imagine that we are very worried over the current situation particularly with all the rumours and conjecture about [Desarrollo] during my visit w/c 21st November 2005. We are clearly unsure what action you propose to take, its likelihood of success, worst possible scenario situation for a house we have paid for in good faith and spent considerable monies on during the last two years ( ... ).We have done everything in a bona fide manner through Atlas, [Desarrollo] and yourselves but are totally unaware of Spanish Law relating to 1) Title Deeds 2) Ownership should [Desarrollo] become bankrupt or insolvent when purchasers have paid for their houses and clearly have proof of payment.We are talking of lives and dreams being ruined because of the current situation.I have been asked by Susan to assign to you Power of Attorney. Perhaps you could advise me what action you propose to take and what our legal situation is in relation to ownership or creditor status i.e. principal or subsidiary in the event of the demise of [Desarrollo].Any information you can provide to me will be greatly appreciated. Your reply is urgently awaited."
(2) Aroca's client log for Mr. & Mrs. Hope records as follows on 24 March 2006:"HE IS NOT HAPPY MAN. HE HAS RECEIVED NO CORREOS [sic] FROM US AND WANTS TO KNOW WHAT IS GOING ON. WE MUST CALL HIM ON 06.04.06 OR HE WILL TAKE FURTHER."
(3) On 11 March 2008 Mr. Hope sent an email to Aroca in which he wrote:"Thank you for your quick reply, but I recently attended an appointment with Senor Manuel Casalderrey on March 4th and was brought up to date with everything. However I have no problem with Senor Casalderrey, who was very polite and helpful, as he assured me that there was no danger of losing ownership of the house which I have paid for in full, but when I asked if I could have this confirmed in writing he was refused permission to do this. I am very disappointed with the service provided to me by Aroca and as I signed power or Attorney at the start of my purchase and it is obvious I have not been represented properly and can assure you I will not let this matter continue and plan to take this further. I am asking for a reply from your most senior management. So could you pass this on to the appropriate department."
(4) On 2 March 2009 Mr. Hope sent an email to Aroca which read:"I would like to make clear that Aroca Seiquer were appointed by myself to obtain my deeds over five years ago and I am still waiting for them. As this is not what I have paid to get done. Am I going to have to pay again. Aroca should not have let this happen. I wish to see a solicitor from Aroca while we are in Spain."
(5)(p) The Insolvency of the Agents
(1) In the 2008 accounts Atlas wrote off a loan (amounting to £4,371,279 as at 31 December 2007) to a related company "as the chances of recovery worsened with the deepening recession" and made provisions against a further intercompany debt of £666,593.
(2) The restatement of the 2007 accounts consisted of reducing the figure for staff costs by over £1million to £472,620. This was a surprising thing to do.
(5)(q) Repossession Proceedings
(1) In 2013 Mr. & Mrs. Hope paid 36,000 to the relevant Bank for the cancellation of the mortgage over their Property, together with payments of 1,472.25 to Desarrollo's liquidators and 30 for a certificate which was required from the local Community.
(2) In 2016 Mr. & Mrs. Whyte paid 48,172 in repayment of the mortgage on their Property and further fees and costs associated with the cancellation of the mortgage, making a total of 51,091.37.
(6) The Claims against the Agents
(1) In each case, the relevant Agent agreed to provide a service to the relevant Claimant(s) if the Claimant(s) purchased a property through them. This gave rise to a contract between the Claimant(s) and the Agent which was collateral to the contract between the Claimant(s) and Desarrollo.
(2) The Agent was obliged to exercise reasonable skill and care in the provision of that service, but failed to do so, in that:(a) The Agent failed to warn the Claimant(s) that there was no bank guarantee in place as required by Spanish law.(b) The Agent failed to warn the Claimant(s) that there was no proof that Desarrollo was able to pass an unencumbered title.(c) The Agent failed to advise the Claimants not to pay anything in the absence of such a guarantee and such proof.(d) The Agent failed to take reasonable steps to ensure before the purchase monies were paid that Desarrollo provided the required bank guarantee and had in place arrangements which meant that it could pass clean title.
(3) As a result of that negligence, the Claimant(s) lost all of the money which they paid to Desarrollo and to Aroca.
(1) the full amount of the purchase price paid by each of the Claimants (or, the case of Mr. & Mrs. Hope and Mr. & Mrs. Whyte, the amount which they had to pay to secure title to their Property);
(2) the amount paid by each of the Claimants to Aroca; and
(3) damages for distress, inconvenience and loss of amenity.
(7) Aroca's Retainer
(1) When did the retainer begin?
(2) What was the scope of the retainer?
(3) Who did the Claimant(s) retain?
(4) What was the standard or care to be observed by Aroca?
(7)(a) When did Aroca's Retainer Begin?
(1) The letters sent by Atlas to Mr. & Mrs. Forrester (on 22 July 2002), Mrs. Stubington (on 5 March 2003), Mr. Dunning (on 18 August 2003) and Mr. & Mrs. Adams (on a date unknown) all indicated that Atlas did not regard itself as having instructed Aroca on their behalf, since they stated that the relevant Claimants would have to send a letter of instruction to Aroca. (Atlas told Mr. Forrester that a letter would not be required, but I saw no evidence that Atlas went on to instruct Aroca on Mr. & Mrs. Forrester's behalf at this stage.)
(2) It was only in the letter of 25 April 2002 sent to Mr. & Mrs. Frost that Atlas stated that Aroca had been instructed on behalf of a Claimant (and that letter went on to say that Mr. & Mrs. Frost would need to confirm this instruction in writing).
(3) The terms of the introductory letters sent by the relevant Agent to the other Claimants are not known.
(1) Mr. & Mrs. Adams. Mr. Adams' letter of 19 June 2004 and Aroca's "Dear Client" letter of 30 June 2004 would have been sufficient to constitute a contract, had it not been for the inclusion in that letter of a fee quotation. I agree with Aroca's analysis that this meant that it constituted a counter-offer which required acceptance. That acceptance came either when Atlas contacted Aroca on Mr. & Mrs. Adams' behalf to arrange a meeting or when Mr. & Mrs. Adams attended Aroca's offices on 8 February 2005. As I have found, that was before they attended the "completion" meeting with Desarrollo.
(2) Mr. Dunning. In Mr. Dunning's case also the contract was formed when Atlas contacted Aroca to arrange a meeting or when he attended Aroca's offices on 2 February 2004, before he attended the "completion" meeting with Desarrollo.
(3) Mr & Mrs. Forrester.(a) Shortly after receiving Atlas' letter of 22 July 2002, Mr. Forrester told Atlas that he wished to instruct Aroca. However, there was no evidence that Atlas in fact instructed Aroca on their behalf at this stage.(b) In Mr. & Mrs. Forrester's case the contract was formed when Atlas contacted Aroca on their behalf to arrange a meeting, or when they attended Aroca's offices on 17 October 2003, before they attended the "completion" meeting with Desarrollo.
(4) Mr. & Mrs. Frost. I find that Mr. & Mrs. Frost's contract with Aroca was formed:(a) when Atlas instructed Aroca on their behalf, as stated in Atlas's letter of 25 April 2002; alternatively(b) when Mr. & Mrs. Frost confirmed that instruction by sending their details and copy passports to Aroca; alternatively(c) when Aroca wrote their letter of 17 September 2002 (and for reasons which I have already given, I do not accept Mr. Turner's argument that these communications were insufficiently certain or complete to give rise to a contract); alternatively(d) when Atlas contacted Aroca to arrange a meeting.
(5) Mr. & Mrs. Hope. I find that Mr. & Mrs. Hope's contract with Aroca was made when on 22 November 2004 a representative of Iberian contacted Aroca on Mr. & Mrs. Hope's behalf and told Aroca that Mr. & Mrs. Hope wished to retain Aroca's services. This was an acceptance of the offer made by Aroca in the "Dear Client" letter.
(6) Mrs. Stubington. Mrs. Stubington's contract with Aroca was formed:(a) on 26 July 2004 when Atlas arranged for her to attend Aroca's offices on 27 July 2004 and execute a power of attorney;(b) on 27 July 2004 when she attended Aroca's offices; or(c) on 27 July 2004 when she executed a power of attorney in Aroca's favour,any of which was capable of constituting her acceptance of Aroca's offer to act for her as set out in the "Dear Client" letter.
(7) Mr. & Mrs. Whyte.(a) I find that Mr. & Mrs Whyte's contract with Aroca was formed when Mr. & Mrs. Whyte sent the form with their details to Aroca (thereby accepting Aroca's offer to provide services as set out in the "Dear Client" letter), or at the latest when Aroca wrote its letter of 4 March 2003 in response (thereby confirming its agreement to act for Mr. & Mrs. Whyte).(b) If that were wrong, I would find that the contract was formed when Mr. & Mrs. Whyte attend Aroca's offices and executed a power of attorney in Aroca's favour on 21 November 2003, or at the very latest when Atlas contacted Aroca on their behalf to arrange the meeting which took place on 9 February 2005.(c) The contract was not discharged when there was a change in the identity of the Property to be purchased by Mr. & Mrs. Whyte. It remained the case that Mr. & Mrs. Whyte wanted Aroca to act for them in connection with the purchase of a Property from Desarrollo. The power of attorney executed on 21 November 2003 remained effective for that purpose.
(8) Mr. & Mrs. Williamson. I find that Mr. & Mrs. Williamson's contract with Aroca was made:(a) when on 17 or 19 January 2005 a representative of Iberian contacted Aroca on Mr. & Mrs. Williamson's behalf and told Aroca that Mr. & Mrs. Williamson wished to retain Aroca's services; alternatively(b) when on 26 January 2005 Mr. & Mrs. Williamson attended Aroca's offices before the "completion" meeting.In either case, this was an acceptance of the offer made by Aroca in the "Dear Client" letter. In the latter case, the fact that Aroca were too busy to attend to Mr. & Mrs. Williamson there and then did not mean that they had not communicated, by their attendance and their wish to see Aroca, their acceptance of Aroca's offer.
(9) Mr. & Mrs. Winter. In Mr. & Mrs. Winter's case the contract was formed either when Atlas contacted Aroca to arrange a meeting or when Mr. & Mrs. Winter attended Aroca's offices on 21 February 2005, two days before they attended the "completion" meeting with Desarrollo.
(7)(b) The Scope of Aroca's Retainer
(1) Aroca did not tell the Claimants that its services would be limited on this way. Aroca did not give the Claimants any document which said this. Nor did Aroca even claim to have said this to the Claimants.
(2) On the contrary, the documents sent or given by Aroca to the Claimants spoke of providing a conveyancing service. "Conveyancing" was the word used in both the "Dear Client" letter and the Provisions of Funds document.
(3) Aroca's position was in substance that by the time the Claimants retained Aroca, the purchase price had already been paid and so it was too late to advise them on the unwisdom of what they had already done. As I have found, this was not the case.
(4) In any event, however, the effect of the agreed expert advice was that one would expect a reasonably competent Spanish lawyer to have advised his client of the unwisdom of paying the purchase price in full without receiving an Escritura de Compraventa, whether he first saw the client before or after he had paid the purchase price.
(7)(c) Who did the Claimants Retain?
(1) A number of those documents referred simply to "Aroca Seiquer & Asociados."
(2) Some referred simply to Sr. Aroca: see the tax administration authority.
(3) Some referred to "Miguel Αngel Aroca Seiquer, (Atlastax S.L.)" or "Miguel Αngel Aroca Seiquer, "Atlastax S.L."": see the tax payment authority and the Bankinter authority.
(4) The only document which referred expressly to Atlastax Internacional SL was that disclosed by Mrs. Stubington, which was headed "Fiscal Representation with Atlastax International S.L." Only Mrs. Stubington was shown to have received this document, but even she did not say that she was given it during her completion trip. Moreover, this document provided information, but was of no contractual effect.
(5) The Fiscal Services Contracts identified the party with whom the Claimants were contracting as "la firma de Abogado Miguel Αngel Aroca Seiquer," and they were signed (or to be signed) by "Fdo. Abogado Miguel Αngel Aroca Seiquer."
(7)(d) The Standard of Care to be Observed by Aroca
(8) Negligence by Aroca before "Completion"
(8)(a) Negligence by Aroca before "Completion": Breach of Duty
(1) failing to warn the Claimants that there was no bank guarantee in place as required by Spanish law;
(2) failing to warn the Claimants that there was no proof that Desarrollo was able to pass on an unencumbered title;
(3) failing to advise the Claimants not to pay anything in the absence of such a bank guarantee and such proof; and
(4) failing to take reasonable steps to ensure before the purchase monies were paid that Desarrollo provided the required bank guarantee and had in place arrangements which meant that Desarrollo could pass an unencumbered title.
(8)(b) Negligence by Aroca before "Completion": Loss
(8)(c) Negligence by Aroca before "Completion": Limitation
"(1) , where in the case of any action for which a period of limitation is prescribed by this Act, either
(a) ; or
(b) any fact relevant to the plaintiff's right of action has been deliberately concealed from him by the defendant; or
the period of limitation shall not begin to run until the plaintiff has discovered the fraud, concealment or mistake (as the case may be) or could with reasonable diligence have discovered it.
References in this subsection to the defendant include references to the defendant's agent and to any person through whom the defendant claims and his agent.
(2) For the purposes of subsection (1) above, deliberate commission of a breach of duty in circumstances in which it is unlikely to be discovered for some time amounts to deliberate concealment of the facts involved in that breach of duty."
(1) in the case of Atlastax, 26 July 2007; and
(2) in the case of Sr. Aroca, 1 July 2008.
"323 it is clear from authority that the statutory words "any fact relevant to a plaintiff's right of action" are to be given a narrow rather than a wide interpretation. Thus in Johnson v. Chief Constable of Surrey (CA, unreported, 19 October 1992), where the claim was in false imprisonment and the police had deliberately concealed facts relevant to the absence of reasonable cause, this court accepted the defendant's submission that "the relevant fact must be a fact without which the cause of action is incomplete", contrasting a fact relevant to an action and to a right of action (5A, 6C). Thus Rose LJ said "Facts which improve prospects of success are not, it seems to me, facts relevant to his right of action" (at 6E). He accepted that the interpretation was a narrow one (at 6G). Russell LJ agreed, saying (at 7E): "Accordingly, whilst I acknowledge that the new facts might make the plaintiff's case stronger or his right to damages more readily capable of proof they do not in my view bite upon the "right of action" itself." And Neill LJ emphasised that although absence of reasonable cause was an element in the tort of false imprisonment, the "gist of the action" is in the imprisonment itself, which establishes a prima facie case and puts the burden of proving justification on the defendant. Therefore the statutory words "must mean any fact which the plaintiff has to prove to establish a prima facie case" (at 8E/H).
324 Moreover, in C v. Mirror Group Newspapers  1 WLR 131 (CA) , where the same words fell to be applied, this time as found in section 32A of the 1980 Act, this court again applied the narrow test determined in Johnson . Neill LJ, with whom Morritt and Pill LJJ agreed, said "The relevant facts are those which the plaintiff has to prove to establish a prima facie case" (at 138H). He again contrasted such facts with evidence which relates "to the proving of the case rather than the existence of the right of action", citing as further authority (at 138D) a dictum of Sir John Donaldson MR in Frisby v. Theodore Goddard & Co (CA, unreported, 7 March 1984)."
(1) The case of Mr. Dawkins shows that Aroca was prepared to advise its clients before they had paid Aroca's fees.
(2) Sr. Aroca's decision not to inform Aroca's clients of his concerns or the reasons for them applied whatever the stage at which they became Aroca's clients and applied whether the clients had or had not already "completed" their purchases.
(3) Thus, for example, in the case of Mr. & Mrs. Winter, I have found that Aroca were paid (on 22 February 2005) before their completion meeting (on 23 February 2005). But it was not suggested that Aroca gave Mr. & Mrs. Winter any advice.
(4) The significance of raising these matters before completion was obvious. It is unrealistic to suggest that, if Sr. Aroca had taken the opposite decision, and had instructed Aroca's staff that new clients should be advised of his concerns and advised not to pay the final instalment unless they received an Escritura de Compraventa, he would have instructed Aroca's staff to wait until payment of Aroca's fees had been received before giving that advice.
"The question is not whether the Plaintiffs should have discovered the fraud sooner; but whether they could with reasonable diligence have done so. The burden of proof is on them. They must establish that they could not have discovered the fraud without exceptional measures which they could not reasonably have been expected to take."
(9) Breach of Fiduciary Duty by Aroca before "Completion"
(1) the fact that Aroca was under a duty to warn the Claimants that there was no proof that Desarrollo was able to pass on an unencumbered title and to advise the Claimants not to pay anything in the absence of such proof; and
(2) Aroca's reasons for not so warning or advising the Claimants.
(10) Negligence and Breach of Fiduciary Duty by Aroca after "Completion"
(1) of the position they found themselves in vis-ΰ-vis Desarrollo;
(2) that they should sue the Agents; and
(3) that they should sue Aroca.
(10)(a) Negligence after "Completion:" the Claimants and Desarrollo
(1) in failing to advise the Claimants that there was no proof that Desarrollo would be in a positon to pass title and that it was wholly uncertain when, if at all, registration would take place; and
(2) in advising the Claimants that their title deeds would be issued within 6-8 or 7-9 months, and thereby wrongly advising that everything was in order.
(10)(b) Negligence after "Completion": the Claimants and the Agents
(1) they should have been advised that they had a clear case against the relevant Agent;
(2) if so advised, they would have brought an action against the Agent;
(3) their action against the Agent would have resulted in a judgment for the whole of the purchase price (together, no doubt, with interest); and
(4) the Agent would have paid the amount of that judgment.
(1) the Agents have not pleaded a limitation defence; and
(2) the real obstacle to any attempt by the Claimants to recover money from the Agents was the Agents' financial position.
"57. As a result of Aroca's further breaches of contract, fiduciary duty and negligence, the Claimants suffered loss and damage ( ), in that they did not issue proceedings against Atlas, Iberian or Aroca for its breaches of duty and trust by early 2006 or thereabouts, or within the primary limitation period for their (non-dishonest) breaches, which expired on various dates from February 2008 onwards."
58. Accordingly, Aroca is liable to the Claimants in the sum of all the amounts which they have lost by reason of any inability Atlas or Iberian would have had, by the end of 2008 to satisfy any judgment against them, or if and to the extent any part of their claim against Atlas and Iberian or itself is statute barred or otherwise barred by lapse of time; alternatively, it is liable for the loss of the opportunity to pursue such claims without such bar or time problem."
(1) Aroca were not negligent as pleaded, i.e. in failing to advise the Claimants that they had a clear case against the Agents. That would be requiring Spanish lawyers to give advice on English law.
(2) I am not persuaded that Aroca, as Spanish lawyers, were negligent in failing to advise the Claimants to consider a claim against the Agents.(a) The expert witnesses were not agreed on this point. Moreover, their evidence on this point was of limited value in any event because it tended to be expressed in terms of "what I would have done." I note, however, that in his written report Sr. Morillas-Paredes focused on a potential claim against the Agents as the recipients of the initial instalments of the purchase price rather than as the Claimants' advisors.(b) Aroca's case derives some support from the fact that independent Spanish lawyers (Manresa & Rivas and Garrigues Legal) were involved in acting for these Claimants and other purchasers, but there was no evidence that they recommended that anyone consider a claim against the Agents. The only claim made against the Agents was unsuccessful, as I have already explained.
(3) Even if Aroca ought to have advised the Claimants to consider claims against the Agents, that did not cause the Claimants any loss because, if they had instructed English solicitors, the Claimants would not have been advised to issue proceedings against the Agents until it was too late to achieve any substantive recovery from the Agents.
"Any sensible person, given the correct advice, would at least have protected himself by the issue of a claim form, pending the attempt to resolve problems with the vendor."
(10)(c) Negligence after "Completion": the Claimants and Aroca
(1) less than 6 years after "completion" and
(2) less than 6 years before these actions were commenced,
in failing to advise the Claimants that it was in the Claimants' interests to bring proceedings against Aroca for the negligence and breach of fiduciary committed before "completion" and/or to warn them that they should seek independent advice on their position as against Aroca.
(1) Mr. & Mrs. Adams: 8 February 2011.
(2) Mr. Dunning: 2 February 2011.
(3) Mr & Mrs. Forrester: 17 October 2009.
(4) Mr. & Mrs. Frost: 24 November 2010.
(5) Mr. & Mrs. Hope: 29 December 2011.
(6) Mrs. Stubington: 29 July 2010.
(7) Mr. & Mrs. Whyte: 9 February 2011.
(8) Mr. & Mrs. Williamson: 26 January 2011.
(9) Mr. & Mrs. Winter: 23 February 2011.
"98. Mr Davidson rightly warns against the court being too easily persuaded by the claimant that he has a fresh cause of action against his solicitor on the basis that the solicitor failed to advise, at some point after his initial negligence, that he had been negligent. If such an argument were too readily accepted, it would have two unsatisfactory consequences. First, it would enable the provisions of the 1980 Act to be evaded in many cases in an artificial way. Secondly, it would effectively impose on a solicitor some sort of implied general retainer. Accordingly, I would accept that it would be a relatively exceptional case where the court would be prepared to hold that a solicitor's negligence claim that was otherwise Statute-barred could, albeit in a slightly different guise, be resurrected on the basis that, at a time within the limitation period and less than six years before the issue of proceedings, the solicitor failed to advise that he had been negligent. Only if the facts clearly warrant such a conclusion should the court adopt it, in my view.
99. It is clear that a solicitor "who has acted negligently [does not come] under a continuing duty to take care to remind himself of the negligence of which, ex hypothesis, he is unaware" per Oliver J in Midland Bank Trust Co Ltd -v- Hett Stubbs and Kemp  Ch at 403C. It is also true, in my opinion, that the mere fact that, following his negligence and within the limitation period, the solicitor is instructed in the same matter by the same client, does not itself put the solicitor under a duty to discover, or advise as to, his negligence on the earlier occasion. As was said by Oliver J in Midland at 403A, the Court must be careful of imposing a duty on a solicitor which involves going beyond his specific instruction. Nonetheless, if the subsequent instruction was also negligently implemented by the solicitor, and, this later negligence concealed the earlier negligence then, subject to normal questions such as causation and remoteness, if the earlier negligence only comes to light outside the limitation period, the loss of the right to sue in respect of it can properly be the subject of a claim based on the later negligence. I derive support for this proposition from Costa -v- Georgiou (2nd May 1984, CA Transcript 15G17D, 18H19G). See also Liverpool  Lloyds LRPN 836 at paragraphs 11 and 27."
"In the circumstances, it is unnecessary to decide whether the principle in Gold v Mincoff applies where both the solicitor had actual knowledge of his previous error and in circumstances in which he ought to have appreciated that he had been negligent previously. Were it necessary, I would have decided that it is consistent both with Neuberger J's articulation of the principle itself in Gold v Mincoff and the extract from the speech of Lord Millett in Cave v Robinson to which I have referred, that the principle should be restricted to circumstances in which there is actual knowledge of the previous error. As I have found that Mr Seigal did not possess such actual knowledge in my judgment, the principle would not have applied in this case in any event."
(10)(d) Breach of Fiduciary Duty after "Completion"
"This form of the tort is committed where two or more persons combine and take action which is unlawful in itself with the intention of causing damage to a third party who does incur the intended damage. It is not necessary for the injured party to prove that causing him damage was the main or predominant purpose of the combination but that purpose must be part of the combiners' intentions."
(11)(b) Unlawful Means
(1) Parties who conspire to use unlawful means can only be liable for the tort of unlawful means conspiracy if they know that what they propose to do in combination is unlawful
(2) There is a different test of intention for the tort of unlawful means conspiracy and the tort of conspiracy to injure. Where parties conspire to use unlawful means, their intention to cause damage thereby to the victim need not be their main or predominant purpose. But where they do not conspire to use unlawful means, they will only commit the tort of conspiracy to injure if their main or predominant purpose is to cause injury to the victim.
(3) It follows from this distinction that the only damage which is relevant in the case of the tort of unlawful means conspiracy is damage which follows from the unlawful means itself.
(11)(c) Unlawful Means: Negligence and Breach of Fiduciary Duty by Aroca
(1) Paragraph 31 asserts that (emphasis added):"Further or in the alternative, Atlas and Iberian are each liable to all the Claimants for Aroca's breaches of contract, fiduciary duty and common law duty or care set out below to the same extent as Aroca (or are at least each is liable to the Claimants for whom they had previously acted) on the basis that:(1) Each of them instructed Aroca to commit them (so that each of them is vicariously liable for the same); alternatively(2) In the knowledge of Aroca's duties to the Claimants, each of them procured Aroca to breach them (so each is liable for procuring breaches of contract), or each conspired with it [i.e. Aroca] so that it [i.e. Aroca] should act in such a way as to breach the duties owed to purchasers, and therefore to the Claimants with the intention of causing loss to them thereby or of exposing them to risk or loss (so it is liable in wrongful conspiracy by unlawful means)."
(2) Paragraph 32 then introduces the matters set out in paragraphs 33 to 40, saying that the Claimants rely on those matters "in support of the above."
(3) Paragraph 41 concludes this section of the Amended Particulars of Claim as follows:"Accordingly, in relation to each Claimant, Atlas and Iberian are vicariously liable in damages (or vicariously liable to pay equitable compensation) to the same extent as Aroca."
(4) Paragraphs 42 to 58 set out the Claimants' various claims against Aroca in negligence and breach of fiduciary duty. These are referred to as the first claim and the second claim
(5) Finally, paragraph 59 provides a follows (emphasis added):"Further or in the alternative, Aroca is liable in damages for breach of contract or negligence, or to pay equitable compensation for breach of fiduciary duty, on the further basis that it [i.e. Aroca] did or failed to do the things complained of in the first two claims above, because it was acting on Atlas's and Iberian's instructions, or pursuant to the said wrongful conspiracy so to act with Atlas and Iberian, rather than in accordance with its own independent judgment of what was in the Claimants' best interests. The consequence of the conspiracy was that Atlas and Iberian were able to induce and to continue to induce purchasers, including the Claimants, to hand over all the purchase price without a bank guarantee or proof of ability to pass good title, and thereby to cause the Claimants to suffer loss even if (as contended by [Sr. Aroca] and [Atlastax]) they had handed over all the price before instructing them, or their instructions were limited merely to registering title."
(11)(d) Unlawful Means: Negligence and Breach of Fiduciary Duty by the Agents
(11)(e) Intention to Injure
(12) Distress, Inconvenience and Loss of Amenity
(13) Contributory Negligence
(1) I will give judgment against the Agents for damages in the amount of:(a) the full amount of the purchase price paid by each of the Claimants (or, in the case of Mr. & Mrs. Hope and Mr. & Mrs. Whyte, the amount which they had to pay to secure title to their Property);(b) the amount paid by each of the Claimants to Aroca; and(c) £1,000 each (or, in the case of Mr. & Mrs. Hope and Mr. & Mrs. Whyte, £500 each) for distress, inconvenience and loss of amenity.
(2) I will give judgment against Sr. Aroca for damages (or compensation) in the amount of:(a) the value of each Property (either on the date of "completion" or such other date as may be determined), which is to be assessed (or, in the case of Mr. & Mrs. Hope and Mr. & Mrs. Whyte, the amount which they had to pay to secure title to their Property);(b) the amount paid by each of the Claimants to Aroca; and(c) £1,000 each (or, in the case of Mr. & Mrs. Hope and Mr. & Mrs. Whyte, £500 each) for distress, inconvenience and loss of amenity.
(3) I dismiss the Claimants' claims in conspiracy.
|Mr and Mrs Adams||Mr Dunning||Mr and Mrs Forrester||Mr and Mrs Frost||Mr and Mrs Hope||Mrs Stubington||Mr and Mrs Whyte||Mr and Mrs Williamson||Mr and Mrs Winter|
|First payment to Agent: Amount (Date)||3,000
|£9,576 & £8,193
|Second payment to Agent: Amount (Date)||£8,145
|Third payment to Agent: Amount (Date)||£41,615.29/ 61,319
(End of April 04)
|Fourth payment to Agent: Amount (Date)||-||-||£31,168.56/44,010
|-||-||30,724.50 & 35,912.50
|Payment to vendor: Amount (Bankers draft & Cash)
|£64,000 & unspecified amount
|28,190 & 13,750.59
|50,273.21 & 29,036.67
|17,045.56 & 22,149.43
|13,813.19 & 31,989.27
|29,380.00 draft & 11,053.37cash.
25,230.00 draft & 13,027.90cash (29.07.04)
|31,057.09 & 9,892.85
|Payment to Aroca: Amount