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Sentence of Section 14 of the Provincial High Court de Madrid, 1/12/1997

 

In a loan contract that a citizen signed with a financing entity, there is a clause which establishes that " the default of payment of two of whichever of the instalments, will allow the financer to demand the immediate payment of the total of all outstanding instalments, the consumer not being able to claim the deduction or devolution of the charge corresponding to the instalments previously paid. The financer will retain this sum as compensation for damages
Comisión EuropeaEscuela Europea de ConsumidoresGobierno de CantabriaMAG (Estudios de Consumo) S.L.IFAVConsomation et Logement Cadre de VieAssociation d'avocats

 

Some cases about over-indebtedness.

  

The case was brought to court, referred to a second court, the doubt arising as to whether the contractual clause could be considered as abusive. In accordance with that established by the General Law on Consumer and User Protection

The court affirms that, in accordance with this law, the clause in question violates article 10c, breaking the fair balance in the attitude of the two contracting parties; if there is non-fulfilment at the start of the contract, the debtor will face a charge in the operation of more than fifty percent in less than a year. Anyway, the court qualifies this conclusion, as being "abstract", since each case brings with it its own specific circumstances

In the case before us, the moment the payment of the loan is taken as rescinded for non-payment of instalments, there are only 5 outstanding payments remaining and the sum for damages amounts to approximately 36,000 pesetas, which is not deemed to be abusive or an excessive sum

Thus, the court confirms the sentence of the court of first instance, which sentenced the citizen to payment of that owed to the financing entity