My off-plan purchase is not proceeding as planned and I want my money back. How should I go about this?

Many people will already be aware that the Spanish Property Company 'San Jose Inversiones' have announced that they were going into a 'concurso de acreedores voluntario' - similar to a voluntary administration in English. That company is not alone and it is of vital importance to determine at an early stage whether the purchaser has a bank guarantee to cover each payment made, as the developer is obliged to provide to the purchaser by law. Bank guarantees often expire after a certain period of time has elapsed hence the reason to act immediately.

Many British investors purchased off plan properties looking for a dream home in the sun as well as hoping for a good return on their initial investment. The developments carried out by San Jose include large golf developments along the Costa Blanca and in Murcia, including Playa Golf in Campoamor, Dolores Golf, Jamilla Golf & Country club and Albatera Golf. The company Idearco looks as though it is heading for a similar fate.

I have covered this issue in the recent past but the question is being asked of us increasingly frequently. I have therefore set out below a few pointers to bear in mind before considering approaching the developer:

Everything will depend on the wording of the contract. No two are the same and ideally the purchaser should possess a signed original;

The breach of the contract needs to be a substantial one; i.e. a delay generally in excess of three months.

Failure by the developer to provide a bank guarantee as per the 'Ley de Ordenación de la Edificación' is almost always sufficient reason to rescind the contract. The bank guarantee must cover the amount paid plus interest until the moment when the purchaser receives the habitation certificate.

Completion before the Notary is the purchaser's last chance to force the production of the habitation certificate, 902 Certificate, bulletins for water and electricity connections and the property being registered as complete (as opposed to 'under construction') at the Land Registry. Failure by the developer to provide all of these may well be sufficient grounds to refuse to complete and resolve the contract.

Anyone wishing to rescind the contract should ideally do so through an independent lawyer. It may be that the claim will be directly against the bank in order to cash the bank guarantee rather than the developer, and professional advice must be taken. Lastly the time to act is often as early as possible given that the first to register a charge against the developer's assets will generally be in a stronger position than those who may follow.

I trust the above is clear although please feel free to give Carlos or myself a call at any time on +34 966-426-185 if you wish to discuss the above or any other issues.

Marc White LL.B. (English Solicitor) C/Diana 19, 2ºD, 03700 Dénia (located at the Glorieta Square end of Marques de Campo)

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