Abogados Legalsha wins a judgment in the SC on abusive clauses in consumer contracts

Abogados Legalsha, one of the leading law firms specializing in consumer defense in our country, has won a pioneering judgment that creates jurisprudence regarding claims for usury and/or lack of transparency in consumer contracts. Specifically, Legalsha has achieved, in a cassation appeal before the Supreme Court, that the High Court imposes costs on banks when a consumer brings an action for the nullity of abusive clauses and for the refund of amounts derived from the same consumer contract (such as a mortgage loan contract), even if they are requested separately in different legal proceedings.

Image: CEO of Legalsha Lawyers, Rebin Shamamy

The Resistance of the Banking Institutions

Until now, the banks argued that the consumer who brought the actions for nullity and for the refund of amounts separately was acting fraudulently and that, if a clause was considered null and void, but the bank was not ordered to refund amounts, this should result in a partial dismissal without costs. In fact, the Provincial Courts did not agree and the rulings issued did not find a single criterion to follow.

This decision of the SC obtained by Abogados Legalsha is now a victory in the fight for the defense of consumers, as the strategy of the consumer who decides to claim the nullity of several abusive clauses inserted in the same contract separately, including the effects of the refund of the amount, is considered lawful and in accordance with the law, stating that there is no fraud of law for this reason. In addition, the Judgment ratifies that it is not possible not to condemn the entities in these cases to pay the costs, since the community maxims always prevail in favor of the consumer.

Proactivity Required of Financial Institutions

The SC has ruled in this Judgment that “the Community principle of effectiveness of Union Law and the principle of avoiding the dissuasive effect on consumers when it comes to protecting their rights must be ensured and respected”. In addition, the High Court has stressed that the financial institution “must have a proactive behavior in the recognition of the nullity and the return of amounts”.

“For us this is an important step in the defense of our clients and consumers, because it opens the door for us to resolve thousands of claims in the same situation in the same way,” said Xosé Feixó Cid, lawyer at Abogados Legalsha and responsible for this procedure.

Precedents of the Judgment

The case dates back to 2021, when the 14th Court of First Instance of Vigo issued a judgment declaring null and void the clauses that imposed on the consumer the payment of the costs of setting up a mortgage loan and the origination fee, without restitutory effects (as these were not requested in the lawsuit) and without ordering the entity to pay the costs, as it was understood that there had been a partial estimation.

This judgment was appealed by the consumer’s defense and the Provincial Court of Pontevedra confirmed the decision of the Court of First Instance, adding that the existence of previous lawsuits for the same contract and other clauses (such as the floor clause), with the same strategy (first claiming the nullity, and in a subsequent lawsuit the corresponding amount), entailed a procedural fraud, and therefore the non-conviction of costs to the entity was justified.

Final Victory in the Supreme Court

Abogados Legalsha, which has led the legal direction of the represented of the case, took the case to the Supreme Court and has achieved that the consumer wins the battle and that the costs are imposed to the financial entity. In the same way, this ruling puts an end to the discrepancy that existed in the different Provincial Courts and in previous rulings.

This same year, the firm achieved another pioneer sentence in favor of consumers: the Provincial Court of Madrid considered a revolving card as usurious, despite the fact that the interest rate (APR) did not exceed the famous 6 points threshold established until now by the Supreme Court.