If we wanted to refer to the technical-legal definition of the mortgage, we could define it as: “A real right of guarantee, which is constituted to ensure the fulfillment of an obligation (normally payment of a credit or loan), which confers on its owner a right of realization of value of a good, (usually immovable) which, Although encumbered, it remains in the possession of its owner, and the mortgagee may, in the event that the guaranteed debt is not satisfied within the agreed term, promote the forced sale of the property encumbered with the mortgage, whatever its holder at that time ( reipersecutoridez) to, with its amount, make payment of the credit due, up to where it reaches the amount obtained with the forced sale promoted for the realization of the mortgaged goods. ”
However, if we turn to the language used by ordinary mortals, they would define the mortgage as “that awkward thing that forces you to sign the bank in case you cannot pay the loan”.
Today, no one or almost no one disagrees with the inconvenience of the mortgages, both from the moment when the procedures to obtain the loan that will result in the subsequent mortgage are initiated, and once signed, the obligations that must be met, the effects of non-compliance, expenses, etc.
Well, although we thought that no one or, better said, almost no one, could be exempt from the “happy” mortgages, we could not even imagine that even our Supreme Court could be involved in a kind of legal maelstrom following its Judgment of Last October 16, dictated by the Second Section of the Third Chamber of the Supreme Court, which, modifying its previous jurisprudence and, interpreting the Consolidated Text of the Law on the Tax on Patrimonial Transmissions and Documented Legal Acts and its regulations, concludes that "The borrower is not the taxpayer of this last tax in the notarial mortgage loan deeds (as that jurisprudence held) but the entity that lends the corresponding sum." In "Román paladino", it is the bank who must pay the AJD tax for the registration of the mortgage and not the recipient of the loan.
The aforementioned Judgment also annuls an article of the Tax Regulation (which established that the borrower is the taxpayer) because it is contrary to the law. Specifically, this is article 68.2 of said regulation, approved by Royal Decree 828/1995, of May 25.
When last Thursday, the 18th, it was announced that the high court took a 180-degree turn and forced the banks and not the clients as until now to take care of this tax, a huge stir in the banking system arose with a stock market crash. Just one day later, the president of the Contentious Chamber - which was not part of the court that issued the sentence - tried to calm the mood by calling a plenary session, which will take place on November 5 and paralyzing any resolution on the matter. Even some Courts, such as the 25 bis of Valencia, issued a statement informing of the suspension of hearings and resolutions until the final position of the Court was known.
Today, no one doubts that our high court has not been able to correctly manage this matter of great economic and social relevance (terminology used by the president of the Third Chamber) because it is not understandable that a jurisdictional instance of such caliber as is the Supreme Court, dictates a Judgment modifying criteria without supposedly having prior knowledge on the part of the president of the Chamber and, where the next day, a paralysis and full call to announce or ratify the criteria expressed by the second section is announced. He even forced the President of the Court to apologize for what happened.
Whoever writes this article takes the opportunity to wonder why in other situations, the Supreme Court did not convene the Plenary to ratify or modify the criteria of any of its Sections, I am referring to the Judgment dated July 9, 2018, which, within the reach of the Judgment of the Constitutional Court on the “municipal capital gain”. In this case, we were also faced with a situation of important economic and social relevance, but nevertheless, the High Court did not submit the criteria of the Second Section to the plenary session of the Chamber.
In short, we will have to wait to know the position that is finally adopted by the Chamber in the plenary session convened for next Monday, November 5, but we can already anticipate and even confirm that even for the Supreme Court, mortgages are uncomfortable.
Miguel Angel Molina Martinez
Partner.
TOMARIAL Lawyers and Tax Advisors.
