Spanish judges begin to appreciate misery caused by 'brutal evictions'


Judges are joining a chorus of opposition to the country’s eviction system, writes GUY HEDGECOEin Madrid

RONALD DE la Cruz is wary of Spain’s justice system. Earlier this year, after falling behind on his mortgage payments, the 48-year-old father of four from the Dominican Republic was told his flat in Madrid would be repossessed by the bank.

The unemployed man and his family prepared themselves for eviction.

Only the presence of dozens of activists blocking the court officials from entering De la Cruz’s house at the last minute stopped the repossession from going ahead.

The head teacher at his children’s school has since persuaded the bank to give De la Cruz and his family more time before returning to carry out the eviction.

But now some eminent members of Spain’s judiciary, which has enforced hundreds of thousands of evictions in recent years, seem to see things from the point of view of De la Cruz and others who have suffered the effects of the country’s mortgage crisis.

A new report by a panel of seven judges lambasts the behaviour of Spain’s banks, casts its eviction laws as anachronistic and says more leeway should be given to those unable to pay their mortgages.

“This is not just about cold figures,” says the report. “Each [eviction] procedure is a drama that leads almost inexorably to the social exclusion of families.”

The magistrates spent eight months researching the document. El País newspaper published sections of it last week on the same day the panel presented the document to the judicial watchdog that commissioned it.

As the report makes clear, Spain’s construction sector, which led a decade-long economic boom, shoulders much of the blame for the eviction crisis.

After the property bubble burst in 2008, tens of thousands of those working in the sector lost their jobs like De la Cruz, often making repayment of the debts they had taken on in the good times impossible.

With Europe’s highest jobless rate, at 25 per cent, Spain has seen 350,000 evictions in the past four years, according to the report, which accuses Spain’s banks of “frivolity and bad practice”.

Lenders, it adds, were guilty of granting mortgages “without evaluating the true paying ability of the client”, as well as the irresponsible sale of complex financial products.

It also highlights the fact that the law relating to mortgages and repossessions dates back to 1909.

One of the most pressing issues to be resolved, the study says, is the fact that repossessed properties are often revalued below market price once the bank recovers them, leaving the former owner saddled with an enormous debt.

De la Cruz bought his home for €216,000 in 2004. But the bank has told him it is only worth half that amount if repossessed, meaning he could still owe almost €150,000 to the bank even after losing his home, once legal costs and interest are taken into consideration.

“You stop paying for a property, so that property is taken away from you, yet you go to the grave still owing money for it – it’s just incomprehensible,” says De la Cruz.

Since the economic crisis hit, grassroots opposition to evictions has grown, led by the Platform for Mortgage Victims organisation and bolstered by the indignados protest movement.

Early-morning vigils by these activists outside homes due to be repossessed have become a regular feature of Spain’s crisis. Their website has a calendar of upcoming repossessions which they plan to block.

A group of these campaigners started camping outside the headquarters of part-nationalised lender Bankia in Madrid last week as part of an effort to change the mortgage law so that a homeowner’s debts are automatically wiped out after repossession.

This is a solution the judges’ report also considers, as well as easing payment demands for those who are ill or out of work.

But by their own admission, the anti-eviction campaigners have been able to stop only a small percentage of repossessions.

“It’s heartening to see that there are some judges out there who are honourable and professional, putting human beings above the bad practices of the banks,” says Aida Quinatoa, a spokeswoman for the mortgage victims’ group, of the report.

“The government has kept supporting these criminal banks and it’s shameful. Spain is the only place in the world in the 21st century where we have seen these kinds of brutal evictions.”