The legal issue that arises is derived from the clause in a sale and purchase contract in which one establishes the handing over of 500,000 Pesetas as means of reserve and as security for the purchase of a certain and identified dwelling. This clause, formulated that, in the case of the holder of the reserve (buyer) abandons the purchase or does not present himself to formalize and sign the corresponding contract or public deed of sale within the indicated timeframe, he will lose the right to the reserve, now null and without value or effect, and the amount handed over in the act remains in the power of the selling party in the notion of an indemnification for the resulting damage and for the limitation of the power of disposal that the reserve brings. In consideration if the seller abandons the process, he should return the amount received as a pre-payment to the seller.

The timeframe established in this contract for the creation of the public deed of sale was extended up to four times and when the last agreed date for the public deed arrived, the contract was not formalised because the seller did not show up. Consequently, the buyer and appellant required the seller, through a notary’s confirmation, to formalise the sale contract and, on the same date the seller required that the buyer provided, through a notary’s confirmation, the communication to him of the abandonment of the contract, based on the aforementioned clause.

The key issue that arose in the judgment was the validity of the aforementioned clause in relation to the concept of abusive clauses that is considered by art 10 bis of the Act 26/1984, for the General Protection of Consumers and Users of Services (“Ley General de Consumidores y Usuarios”) that, in relation to the Act on General Contractual Conditions (“Ley de Condiciones Generales de la Contratación”), deems as abusive clauses, among others, (I) the reserve of interpretation powers in favour of the professional or unilateral amendment to the contract without valid reasons specified within it, (ii) the early resolution of a contract within a certain deadline unless the consumer has the same power recognised, (iii) the resolution of the contract of undetermined duration within a disproportionately short deadline or without a reasonable period of previous notification, unless for incompletion of the contract or for serious reasons that changes the circumstances which motivated its celebration.

In this sense, the judgments of the 1st and 2nd Instances declared the aforementioned clause as abusive. Likewise these judgments recognised the bad faith of the respondent seller by protecting himself in a pact where a security deposit acted as a penalty, in order to justify the abandonment of the contract, through a flagrant abuse of the right to avoid signing the contract and achieve a greater price in a new sale of the property.

Lastly, the Supreme Court considered that the contractual clause, at the heart of this judgment, that permits the abandoning of the contract with the simple handing over to the buyer of the amount received as security to contract was abusive and, as such, null even though there was no correlation between the obligations of the parties and they produce an important imbalance between them, damaging to the consumer. On the basis of the aforesaid, the Supreme Court declared that of the contract of sale remains in force, and thus also the obligation of the seller to formalise it in public deed.