The Provincial Court of Las Palmas has issued a landmark ruling that brings to a close a protracted commercial dispute in southern Gran Canaria. The higher court has completely overturned the decision previously handed down by a court in San Bartolomé de Tirajana. With this ruling, the court dismisses in its entirety the lawsuit filed by the company Explotaciones Turísticas Panamá against the homeowners' association of its residential complex. The legal conflict originated at the ordinary general meeting held at the end of June 2020.
During that meeting, the homeowners' association approved a series of points that the company decided to challenge in court. Among the contested agreements were the settlement of debts owed by members in arrears, modifications to the water and electricity infrastructure project, and a matter as critical to the complex's safety as the closure and preventative draining of the community pool due to a clear structural risk of collapse. The lawsuit also challenged the formal approval of the association's annual accounts and various notices issued to owners to prevent the misuse of the facilities and common areas.
In the first instance of the proceedings, the court in San Bartolomé de Tirajana partially upheld the company's claims. The judge declared the nullity of only the agreements corresponding to points five and six of that meeting. However, disagreement with the judicial ruling led both parties to file appeals with the Provincial Court.
Upon assuming jurisdiction over the case, the provincial court chose to focus its analysis on a preliminary and imperative legal issue: the objection of lack of standing raised by the defendant homeowners' association. The judges noted that the Horizontal Property Law establishes an essential procedural requirement. Any owner seeking to challenge in court the resolutions adopted within a homeowners' association must be fully current on all outstanding debts or have previously deposited them with the court.
The law provides for a single, specific exception to this general rule. This exception applies exclusively when the challenge to the agreements concerns the establishment or alteration of the ownership shares stipulated among the owners. Relying on the established doctrine of the Supreme Court, the court determined that the plaintiff company completely lacked standing to bring the legal action.
The court found that the company went to court without having fully deposited the amounts claimed by the community, which included the surcharges applied for late payment of its financial obligations. Similarly, the court ruling emphasized that none of the points in dispute modified the general system for distributing expenses or altered the participation coefficients established in the deed of incorporation. The court clarified that the surcharge applied was in response to a penalty approved at a previous meeting held in February 2019, which had not been challenged in court.
The court emphasized that the community president's flexible approach in allowing community members to participate and vote under procedural safeguards did not exempt them from the strict procedural requirement of prior payment mandated by law. Consequently, since the exceptional circumstances exempting them from prior payment were not present, the initial claim should have been dismissed for procedural error at the time. The Provincial Court's ruling upheld the community's appeal, overturned the original judgment, and dismissed the claim filed by Explotaciones Turísticas Panamá. The decision ordered the company to pay the costs of the first instance proceedings, declared the costs of the appeal ex officio, and definitively closed the dispute in the southern region of the island.
