Housing management company held liable as a de facto developer

A Court of First Instance in the judicial district of Alcalá de Henares has just ordered a company that presented itself solely as the cooperative’s management company to compensate the owner-members of a residential development (supposedly developed by the cooperative members themselves) for the construction defects in their building, on the grounds that the defendant was the real developer and seller of the building.

The judgment, handed down in proceedings conducted by DPcon, states that, from the documents in the case file, it can be inferred that, regardless of the legal form the defendant may have adopted, it was the real seller and developer of the homes, and therefore must be held liable under article 17.4 of the LOE.

The following requirements established by case law were met: the works were carried out for its benefit; they were intended for sale to third parties; the third-party purchasers relied on its commercial reputation; this developer/manager was the one who chose and hired the contractor and the technical staff; and taking the opposite view would mean limiting the protection of, or leaving unprotected, future buyers of flats, dependent on the greater or lesser solvency of the other parties involved in the construction.

In addition, as most of the damage was due to poor workmanship in the communal areas, several (non-joint) liability has also been imposed, in respect of certain defects (problems with drains, reversed falls, poorly laid waterproofing membrane, badly installed tree pits, etc.), on the building contractor and the technical architect, as those responsible for carrying out the works and as site manager respectively. The judgment is not yet final and may be appealed by the parties found liable before the court of second instance; nevertheless, we consider it a good step for the homeowners’ association, since the judgment is well reasoned and we think it unlikely to be overturned.

If your homeowners’ association was set up as a cooperative, but with a clear de facto developer behind it, and there are building defects, do not assume that the cooperative cannot take action against them; contact us. DPcon Reclamaciones Daños Constructivos.