España

Sentence of Section 8 of the Provincial High Court of Madrid, 26/9/1997

 

The litigation revolves around the contract for opening a current account, more concretely with respect to overdraft and the interest paid thereon. Questioned here is one of the stipulations contained in the contract, establishing that the interest to be paid to the banking entity would be that notified to the Bank of Spain. The rate of interest is to be posted in a visible place in the offices of the finance entity
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.

  

In this case, the court affirms that, according to the General Law on Consumer and User Protection, this contractual clause can be deemed as abusive, from the moment in which the consumer is placed in a position of total ignorance with respect to the interest rates applicable in the case of overdraft, at the time of signing the contract. The consumer should have been issued with documented information on the interest rates, as an inexcusable condition and minimum guarantee for supposing that the consumer accepted the contract in its entirety. Without prior comprehensive information, the consumer cannot duly know about what obligations pertain

Thus, the court admits the abusive nature of the contractual clause