The Second Section of the Contentious-Administrative Chamber of the Supreme Court has issued a ruling ordering the Yaiza City Council to pay default interest in relation to the return of the Tax on Installations, Constructions and Works (ICIO) for the illegal license granted for the Costa Roja urbanisation, which was promoted by Luis Lleó, convicted in the Unión case.
In the ruling, dated February 15, the high court upholds an appeal by the company Hoya de la Yegua (to which the rights of the license granted to Residencial Costa Roja had been assigned), which claimed from the Yaiza City Council the payment of 787,759.63 euros "plus the corresponding legal interest".
The license for the construction of Residencial Costa Roja in Playa Blanca, which included 1,012 homes, 220 commercial premises and 2,559 parking spaces, was granted by the Yaiza City Council in December 2006, when José Francisco Reyes was in charge of it. After that, it was challenged by the Cabildo of Lanzarote and the César Manrique Foundation and, in September 2007, the Court provisionally suspended the building permit. Subsequently, in two judgments of May and November 2013, the Court declared the license for the construction of the residential complex null and void.
A year later, in October 2014, an agreement was included in the Yaiza Supplementary General Plan to develop the Costa Roja plot and the company Hoya de la Yegua requested the return of the ICIO paid between 2006 and 2007. Then, the Yaiza City Council ordered the return of 1,664,342.10 euros plus 71,587.26 euros that were established as default interest.
However, as the company was not satisfied with the amount paid, it filed an appeal with the City Council and, after it was rejected by the latter, decided to appeal to the Courts. Then, in the first instance, it was ruled that the City Council had to pay interest from 2006, but after that it was the City Council that decided to file an appeal, before which the TSJC issued a ruling establishing that the date of settlement of interest should be October 9, 2014.
Now, after a new appeal by Hoya de la Yegua, the Supreme Court has corrected the TSJC's criterion, again giving the company the reason. "The income has not become unduly undue due to the dynamics of the tax, but because the license that protected the tax turned out to be null and void because it was contrary to the urban planning regulations. So much so, that this circumstance was present very shortly after the moment in which the last installment was paid, since the taxpayer could not start the work by judicial decision (by the order of suspension of the competent body)," the court points out.
Thus, it concludes that "it does not seem reasonable to impute" to the company Hoya de la Yegua the lack of completion of the works, "when such works could not be carried out as a consequence of a precautionary decision adopted in a process in which the City Council -which had granted the license- had the status of defendant", "when the license itself -granted by the defendant today- is declared null and void by illegal in said process", and "when the City Council knew that it was not possible to execute the works since September 2007 due to a fact that was not the responsibility of the licensee".
A magistrate who was involved in the Unión case
Among the magistrates of the chamber of the Supreme Court that issued this ruling in February is the name of Ángel Aguallo Avilés, whose name was precisely involved in the Unión case, after finding emails in which he allegedly advised Luis Lleó as stated in the UCO reports. However, those tests ended up being invalidated, as the entry and registration orders in the businessman's offices were annulled.
With respect to the Costa Roja case, it should be remembered that it was La Voz who made public in February 2007 the granting of the license, and fourteen years later, is still pending trial. In it, the former mayor of Yaiza, José Francisco Reyes, the former secretary, Vicente Bartolomé Fuentes, and the former head of the Technical Office, Antonio Lorenzo, will be in the dock, for crimes of urban planning prevarication in the granting of that license.