Non-Paying Customers in Spain

Business Debtor Spain

We are a UK company that sent a shipment of our products to a distributor in Spain without billing in advance as normal (an oversight due to a seasonal rush).

The distributor has failed to pay, offering various excuses, including that the shipments did not match their orders, which is patently untrue. Given that we did not sign any specific contract with this distributor, what are our rights in this situation?

According to Article 50.1 of the Spanish Civil Code, as the debtor has his residency here in Spain, the Spanish courts are competent to judge this legal issue. Even so, it would be advisable to sign a contract (in Spanish) which specifies that, in case of dispute, the parties designate the Spanish Courts as competent, as this will facilitate searches to be carried-out with regard to the financial position of the breaching party and any assets they have.

While certainly it does appears that you have emails from the distributor asking you for some products, on the other hand it is important to be in possession of an email sent to the distributor in which appears a summary of the price you expect the distributor to pay for a specific quantity of particular products with the total price in Sterling or Euros that you are now claiming from him.

Moreover, you should be in possession of the specific email that the distributor sent to you agreeing to the order or alternatively, the email to which is attached the invoice with his signature.

It may well be that the invoice appears in one of the emails as an attached file, in which case you are obliged to hire a notary in the UK who will certify the contents of those emails and certify that the invoice appears as an attached file in one of them.

The Spanish legislation is very formal in this sense: If we cannot prove in court that the invoice exists in one of the emails as an attached file it´s going to be difficult to succeed in any proceedings for the recovery of the debt. However, once demonstrated that the order was received and approved by the distributor we can pursue the matter in court for recovery of either the amount of the order or the return of the products if this is an appropriate remedy. In addition, you may seek full payment of your legal costs and the costs of recovery.

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