Legal Costs - Timeshare Claims in Spain.
In Spain there is only one category of lawyer (abogado) who, after becoming a member of the professional association of the place, can appear in any type of proceedings and before any type of court.
Lawyers set their fees according to guidelines published by their professional association. These rules are based on general criteria for drawing up lawyers’ bills, such as the complexity of the case, proportionality, etc., and are followed by all lawyers when issuing their bills.
These rules always distinguish between the separate court systems in which litigation takes place.
- Fixed fees
- Fixed fees in civil proceedings
- Fixed fees for litigants in civil proceedings
Article 241(1)(1) of the Code of Civil Procedure (Ley de Enjuiciamiento Civil) specifically covers lawyers’ fees for cases where the assistance of a lawyer is mandatory. These fees are included as an item in calculating costs.
The Code of Civil Procedure provides for lawyers to set their fees subject to the rules governing their profession.
Stage of the civil proceedings at which fixed fees must be paid:
A client is always required to pay fees to his or her lawyer. The client has a rough idea of the sum involved from the outset but the exact amount of the lawyer’s bill has to be established once litigation has ended. The lawyer can claim payment from the client, including through special procedures such as an advance on fees (provisión de fondos, while the proceedings last) or a final statement of accounts (jura de cuentas, once concluded).
In practice, what usually happens is that the client initially pays an amount in advance and then awaits a decision on costs. In cases where the other party has to pay the fees, the lawyer and legal representative present their fees to the court, and once the fees are approved they are paid by the opposing party. Since Law 10/2012 came into force, a court fee must be paid.
What is a court fee?
It is a national tax that must be paid in certain cases by users, whether natural or legal persons, for going to court and making use of the public service of the administration of justice. The Ministry of Finance and Public Administration is legally responsible for managing this tax. The requirement to pay this fee was introduced on 1 April 2003 and it is currently governed by Law 10/2012 of 20 November 2012, as amended by Royal Decree 3/2013 of 22 February 2013 concerning certain fees in the context of the administration of justice and the National Institute of Toxicology and Forensic Science.
Cases in which payment of this fee is mandatory (chargeable event)
Under Article 1 of Law 10/2012, the fee for the exercise of judicial power in civil, administrative (contencioso-administrativo) and employment cases is a national fee that is uniformly chargeable throughout Spain in the circumstances provided for by that Law, without prejudice to the fees and other taxes charged by the Autonomous Communities in the exercise of their respective financial powers. These may not be levied on the same chargeable event.
Under Article 2, the chargeable event for the fee is the exercise of judicial power generated by the following procedural steps:
Bringing of an action in any type of proceedings for a full judgment and proceedings for the enforcement of out-of-court enforceable instruments in civil cases, the filing of a counterclaim and the initial application for the order for payment procedure and the European order for payment procedure.
- Filing for compulsory insolvency and ancillary claims in bankruptcy proceedings.
- Lodging of proceedings in administrative court cases.
- Lodging of an extraordinary appeal for breach of procedure in civil proceedings.
- Lodging of appeals (apelación or casación) in civil and administrative court cases.
- Lodging of appeals (suplicación or casación) in employment cases.
- Objection to the enforcement of judicial instruments.
Who is required to pay the court fee?
Article 3 states that anyone who instigates the exercise of judicial power that produces the chargeable event is liable for payment of the fee.
For the purposes of the preceding paragraph, a single chargeable event is deemed to have occurred when the document instituting the procedural step that constitutes the chargeable event covers several main actions that do not originate from the same instrument. In this case, the amount of the fee is calculated by adding together the amounts for each of the joined actions.
The fee can be paid by the legal representative (procurador) or lawyer (abogado) in the name and on behalf of the taxable person, in particular if the latter is not resident in Spain. A non resident need not obtain a tax identification number with a view to self-assessment. Neither the legal representative nor the lawyer bears tax liability for this payment.
Exemptions for categories of action:
- Bringing of an action and lodging of subsequent appeals relating to cases of capacity, filiation, matrimony and minors covered by Title I of Book IV of the Code of Civil Procedure. However, proceedings covered by Chapter IV of the above Title and Book of the Code of the Civil Procedure that are not initiated by common consent or by one of the parties with the agreement of the other, even when minors are involved (unless the measures requested only concern minors) are liable for payment of the fee.
- Bringing of an action and lodging of subsequent appeals involving proceedings specifically set up to protect fundamental rights and public freedoms, and also appeals against the conduct of the election administration.
- Filing for voluntary insolvency by the debtor.
- Lodging of administrative proceedings by public servants in defence of their statutory rights.
- Lodging of the initial application for the order for payment procedure and the request for a full judgment to claim the amount involved where it does not exceed €2 000.
- This exemption does not apply when the claim in these procedures is based on a document that takes the form of an out-of-court enforceable instrument pursuant to Article 517 of the Code of Civil Procedure (Law 1/2000 of 7 January 2000). Lodging of administrative court proceedings challenging the administration's failure to respond or lack of action.
- Bringing of an action for the enforcement of awards decided by the Consumer Arbitration Boards.
- Actions which, subject to authorisation by a Commercial Court, are brought by the insolvency administrators in the interest of the insolvency estate.
- Proceedings for judicial division of estates, except in cases where an objection is raised or there is dispute over the inclusion or exclusion of assets. The fee is payable for the hearing and for the amount disputed or that arising from a challenge to the distribution of the estate by an opponent. If both parties object, each is charged for their respective amount.
Exemptions for categories of persons:
- Persons who are entitled to legal aid and can demonstrate that they meet the statutory requirements.
- The Public Prosecutor’s Office.
- The General Administration of the State and of the Autonomous Communities, the local authorities and all public bodies under their authority.
- The Spanish Parliament and the Legislative Assemblies of the Autonomous Communities.
Lastly, in the area of employment law, workers, whether they are employees or self-employed, are entitled to an exemption of 60% of the amount of the fee chargeable for filing appeals. In administrative cases, public officials acting in defence of their statutory rights are entitled to a 60% exemption of the amount of the fee chargeable for filing appeals.
Rights and obligations of the parties
As the representative of the party, the legal representative (procurador) has a duty to inform the client of all the procedural steps. Both the lawyer and the legal representative have a duty to inform the client as often as the the client so requests.
Where can I find information on costs in Spain?
There is no specific internet page where information can be found on costs of legal proceedings in Spain. Nevertheless, there are web pages, such as those of the bar associations, which provide information on the fees of their members.
In which languages can information on costs in Spain be obtained?
The information is usually provided in Castilian Spanish. It is also possible to find information in the official languages of the Autonomous Communities. Some pages also provide certain information in English.
What is it?
Pursuant to Article 119 of the Spanish Constitution, legal aid is a procedure whereby those who can demonstrate a lack of sufficient financial means are granted a series of benefits mainly consisting of exemption from payment of lawyers’ and legal representatives’ fees and costs arising from expert testimonies, guarantees, etc. Broadly speaking, the right to legal aid includes the following benefits:
- free advice and guidance prior to the start of proceedings;
- access to a lawyer by the person under arrest or the prisoner;
- free defence and representation by a lawyer and legal representative during the legal proceedings;
- free publication in the course of the proceedings of announcements and edicts that must be published in official gazettes;
- exemption from the payment of deposits for the lodging of appeals;
- free assistance from experts during proceedings;
- free procurement of copies, testimonies, instruments and notarial certificates;
- 80% reduction in fees for certain notarial actions;
- 80% reduction in fees for certain actions carried out in relation to the Land and Commercial Registers.
For cross-border disputes only (after reform of the Legal Aid Law by Law 16/2005 of 18 July 2005, which brought it into line with Directive 2002/8/EC), the following items have been included in the above rights:
1. Interpretation services.
2. Translation of documents.
3. Travel costs where an appearance in person is required.
4. Defence by a lawyer and representation by a legal representative even where unnecessary, if the court requires this in order to guarantee equality of the parties.
Who can request Legal Aid?
In general, it can be requested by citizens who are involved in or about to initiate any kind of legal proceedings and who lack sufficient financial means to carry out the litigation.
Natural persons are deemed to have insufficient resources when they can provide evidence that all the components of their annual resources and revenue, calculated by family unit, do not exceed twice the Public Index of Income (IPREM) applicable at the time of application.
For legal persons to qualify for legal aid, their taxable base for corporate tax must be lower than the amount which is equivalent to three times the annual calculation for the IPREM. In any case, other external signs that demonstrate the real financial capacity of the applicant will be taken into account.
There are exceptions for natural persons based on disabilities and/or other family circumstances that allow the above income limits to be exceeded. (Under the terms of the Twenty-Eighth Additional Provision of the General State Budget Act (LPGE) for 2009, the IPREM stood at €7 381.33 per annum in 2009).
Specifically, the following are entitled to legal aid:
1. Spanish citizens, nationals of other Member States of the European Union and any foreigners resident in Spain, where they can demonstrate insufficient means for litigation.
2. Managing bodies and common services of the social security system.
The following legal persons, where they can demonstrate insufficient means for litigation:
- Non-profit organisations.
- Foundations registered in the corresponding administrative register.
- In employment proceedings: all employees and beneficiaries of the social security system.
- In criminal proceedings: all citizens, including foreigners, who can demonstrate insufficient means for litigation, even where they do not legally reside in Spain, are entitled to legal aid and defence and representation free of charge.
- In administrative court proceedings: all foreign citizens who can demonstrate insufficient means for litigation, even where they do not reside legally in Spain, are entitled to legal aid in all proceedings relating to applications for asylum and the Law on Foreign Nationals (including preliminary administrative proceedings).
Requirements for applying for legal aid
All the components of the person’s annual resources and revenue, calculated by family unit, must not not exceed twice the Public Index of Income (IPREM) applicable at the time of application.
The Legal Aid Commission may exceptionally decide to grant the right to legal aid where the resources exceed double the IPREM but do not exceed four times the IPREM and, based on the circumstances of the applicant's family, number of children or family members under their charge, state of health, disability, financial obligations, costs arising from the initiation of the proceedings or other circumstances and in any case where the applicant holds the status of relative in the ascending line of a special category large family.
The litigant must be defending their own rights and interests.
The legal person must be a non-profit organisation or foundation registered in the corresponding administrative register. Its taxable income for corporate tax must be less than the amount equivalent to three times the annual calculation of the IPREM.
With the entry into force of Organic Law 1/2004 of 28 December 2004 on Comprehensive Protective Measures against Gender Based Violence (Ley Orgánica 1/2004 de Medidas de Protección Integral contra la Violencia de Género), women who are victims of gender-based violence are granted full legal aid immediately, not only in all legal proceedings but also in administrative court proceedings (police inquiries are therefore included) motivated by gender-based violence, until such time as a judgment is delivered, without being required to apply for legal aid beforehand. This means that the issue of legal aid will never hinder the right to defence and to effective judicial protection, which will be offered to the victim irrespective of whether an application for legal aid has been filed. However, this is on the understanding that such legal aid is given only where the party concerned can demonstrate, a posteriori or during the course of the legal proceedings that the circumstances actually exist for entitlement to legal aid, as required by the general rules contained in the Law on Legal Aid and accompanying Regulations, amended to this effect by the Sixth Final Provision of Organic Law 1/2004.
When does the losing party have to pay the costs of the proceedings?
Articles 394 to 398 of the Code of Civil Procedure cover the order to pay costs in civil proceedings.
In actions for a full judgment, the costs of first instance are payable by a party whose claims have all been dismissed, unless the case raises serious matters de facto or de jure to be clarified. If claims are granted or dismissed in part, each party pays its costs and half the joint costs, unless there are grounds for imposing them on one of the parties because of reckless litigation.
Where the costs are imposed on the losing party, he or she will be required to pay, for the part corresponding to lawyers and other legal professionals not subject to rates or scales, only a total amount of no more than one third of the sum at issue for each of the litigants that have secured the decision. For these purposes only, claims on which no value can be put will be valued at €18 000, unless the court determines otherwise because of the complexity of the case.
The provisions in the preceding paragraph do not apply if the court declares that the litigant ordered to pay the costs has acted recklessly.
Where the party ordered to pay the costs is entitled to legal aid, he or she will be required to pay the costs occasioned by the defence of the interests of the opposing party only in cases specifically indicated in the Law on Legal Aid.
In no circumstances will costs be imposed on the Public Prosecutor’s Office in proceedings to which it is party.
Experts used in the proceedings are known as ‘peritos’. A Register of Legal Experts can be found at each High Court.
Article 241(1)(4) of the Code of Civil Procedure covers, as a specific item to be included in calculating costs, the ‘fees of experts and other payments which may have to be paid to persons playing a part in the proceedings’. This refers to costs incurred by persons who, although not a party to the proceedings, have certain expenses as a result of attending the proceedings to provide some service.
Article 243 of the Code of Civil Procedure stipulates that in all proceedings and actions, costs are calculated by the clerk of the court that heard the case or appeal. Any fees corresponding to writs and documents relating to proceedings which are unnecessary, superfluous or not authorised by law, or items in lawyers’ fees which are not listed in detail or which refer to fees that have not been earned in the litigation are not included in the calculation.
The court clerk will reduce the amount of lawyers’ and other legal professionals’ fees not subject to rates or scales if the fees claimed exceed one third of the sum at issue and no recklessness by the litigant ordered to pay the costs has been declared. The costs of actions or incidental steps for which the winning party has expressly been ordered to pay by the decision on costs in the main proceedings are not included either.
Translators’ and interpreters’ fees
There is no official rate applicable to sworn translation and interpretation services. Sworn interpreters are free to set the fees charged for their interpretation services but they are required to inform the language interpretation office and the corresponding Government Sub Delegation of their rates. This information must be provided in January of each year.