Litigation and enforcement in Spain: overview

The vast majority of conflicts are resolved by court litigation. However, parties to a commercial agreement can submit disputes to judicial tribunals, arbitration or mediation. Recent trends indicate an increasing use of arbitration to resolve large commercial disputes, such as corporate, construction, finance and banking disputes.

In court proceedings, procedural documents and all notifications made during court proceedings must be served and received online through an electronic system of communications named LEXNET.

It is possible to use online arbitration in consumer disputes, and online mediation with some restrictions (such as matters related to poisoning, personal injuries or death, suspicion of crime and previous final judgment delivered on the same dispute (res iudicata).

In civil disputes, the burden of proof rests on the claimant on the basis of the evidence provided. In criminal disputes, the burden of proof rests on either or both the public prosecutor and the private prosecutor by establishing the facts of the case beyond reasonable doubt. The presumption of innocence principle is applied.

The general limitation period for personal actions is now five years (Article 1964, Civil Code). (It was 15 years until the reform of the Civil Procedure Act, which came into force on the 7 October 2015.) There are further limitation periods of five years for contractual obligations (Article 1964, Civil Code) and one year for non-contractual obligations (Article 1968, Civil Code).

Those terms run from the time of a cause of action arising until the commencement of court proceedings. Expiry of the applicable limitation period terminates the right to sue; that is, the right of action lapses.

Courts and tribunals are structured depending of the nature and the economic value of the claims which they adjudicate. Different judicial bodies exercise different judicial powers, which are divided into civil, criminal, administrative and military. The Spanish judicial system is structured into several levels.

Commercial Courts were created in 2003 and have jurisdiction over competition, insolvency, intellectual property, corporations, maritime, publicity issues and other mercantile contractual disputes.

Civil and commercial matters that are not exclusively assigned to the commercial courts are assigned by default to the civil courts, in particular, the first instance courts.

The first instance courts and mercantile courts are the first steps in the Spanish judicial structure. They are followed by the appeal courts, which are tribunals that review judgments issued by lower courts. Finally, the Supreme Court can review certain cases and judgments issued by a court of appeal. However, leave to appeal to the Supreme Court is severely restricted.

There are different types of proceedings depending on the nature, complexity and quantum of the dispute. The Civil Procedural Law regulates two different declarative procedures:

A lawyer must be a member of a local bar association, such as the Bar Association of Madrid. Membership requirements for all bar associations are the same. Currently, there are four specific requirements for membership:

Lawyers who are nationals of EU member countries must have a home country law degree and comply with the fourth requirement mentioned above or spend a period of three years as trainee with a national lawyer with more than five years of experience. Lawyers from a third country other than the EU must obtain nationality waivers (“disputas de nacionalidad”), which are granted on a reciprocal basis by the Ministry of Justice.

Lawyers determine their own fees, based mainly on the amounts at issue, the complexity of the case and the lawyer’s prestige or special qualifications. There are no other specific restrictions or fixed-fee system, and lawyers agree with their clients on the fees depending on the case.

In the case of conflict regarding legal fees, the standards of the bar association where the lawyer practises are used as a reference to determine the fee amount. These standards are non-binding. However, they are followed by the courts when awarding legal costs to a successful litigant (except in administrative cases).

Litigation is usually funded by the parties. However, the unsuccessful litigant pays the litigation costs of the other party where ordered by the court, based on recommended fees approved by the local bar associations. Third parties can fund litigation costs if they have reached an agreement to do so with the litigant.

Insurance for litigation costs is not normally available, except under a specific third-party insurance policy taken out by one of the parties.

Hearings and trials are public unless the judge orders otherwise, on the grounds that publicity could affect the parties’ or third parties’ rights, legal principles or constitutional values. However, access to court files is restricted to the relevant parties.

There are no general rules for pre-action conduct, although some rules apply in some specific cases, such as:

There are no penalties relating to pre-action conduct, although the action initiated may be dismissed by the court at its discretion.

There is no compulsory formal procedure that parties must follow before the start of proceedings. However, in general they will try to reach a friendly settlement before applying to the courts. If a party applies to the court, the proceeding starts with the claim to the registry of a competent court. The claim must include:

Mediation in civil and commercial matters was introduced by Law 5/2012 of 6 July, but this is ultimately voluntary.

The defendant is served the claim where he or she is domiciled, or at any legal address where he or she can be found. The defendant must file the writ of response within 20 days after the service of notification, in ordinary procedures and within five days in small claims procedures.

Once the writ of claim and writ of defence (or the counterclaim and defence to the counterclaim) have been filed, the parties are convened by the court at a preliminary hearing with the main purposes of:

The court then approves or denies the evidence proposed by the parties and sets a date for trial.

Procedural documents and all notifications made during court proceedings must be filed, served and received online, through an electronic system of communication (Lexnet).

Actions are only available for the defendant to dismiss the case before trial in exceptional cases. For example, when challenging the jurisdiction of the Court, although usually it is the clerk of the court who examines these issues before the claim is admitted and notified to the defendant.

According to The Civil Procedural Law, a case can be dismissed before a full trial on the following grounds:

A defendant can apply for an order for the claimant to provide security for its costs through an interim measure. To grant injunctive relief, the judge must be satisfied that:

As a general rule, the claimant must provide security for its cost.

Parties can request protective measures at any time during the proceedings, and even before the statement of claim has been filed. The purpose of the measures must be solely to protect the effectiveness of the judgment.

The main criteria for granting interim measures are:

Ex parte orders are an exception in Spanish law and practice. A Spanish judge will only very rarely grant an injunction without hearing the defendant.

There is a type of order that compels a party to do something. If a party does not comply, the remedy is for either the:

The right of the defendant to be heard means that no judgment can be rendered against a party without that party having had the opportunity to be heard. This entails notifying a defendant of the initiation of proceedings, and of the main procedural acts, such as interim measures. A breach of this principle would render the proceedings null and void.

The parties can appeal a court order accepting or rejecting an interim measure. However, if the order accepts the measure, filing the appeal does not prevent the measure from being enforced (Article 735, Civil Procedure Act).

Interim attachment orders to preserve assets pending a substantive judgment are available (see Question 10 and Question 12).

An interim attachment can be applied for at any time during the procedure, but the granting of ex parte orders is extremely difficult in Spain (see Question 12).

Interim attachment orders are permitted in main proceedings (Article 730, Civil Procedure Act).

A preferential right or lien can be obtained if the attachment order is registered as a lien in the property register.

If the attachment order is dismissed on appeal or the court finds in favour of the defendant in the main proceedings, the claimant will be liable for damages caused to the defendant by the attachment, but any damage must be proven.

The claimant must offer security to cover potential damages if the claim is dismissed or the protective measure reversed. This is usually in the form of a bank guarantee in favour of the court.

Other interim remedies include, among others, the:

The court can grant damages, order specific performance or the performance of the obligation in question by a third party at the defendant’s expense. Damages are limited to the compensation of the costs and loss of profits suffered by the claimant. No punitive damages are available in Spanish civil proceedings, except for competition law infringements.

The duty to exhibit documents is governed by Article 328 of the Civil Procedure Act, under which each party can require the other parties to exhibit any documents that relate to the matter in dispute or the value of evidence presented. However, this duty cannot be characterised as a pre-trial discovery procedure as found in common law jurisdictions.

A non-certified copy of the document must be attached to an application. If a document does not exist or is unavailable, its content must be indicated as accurately as possible.

In proceedings dealing with a commercial infringement of industrial or intellectual property rights, the plea for exhibition can be extended to any bank, financial, commercial and customs documents produced during a specific period. The court can decide to keep the proceedings confidential at the request of any party to ensure the protection of confidential data and information.

Legal professional privilege covers confidential communications between lawyers and their clients, and certain other information relating to litigation. The privilege applies to information that would be subject to legal professional privilege where litigation is in progress and ensures that the confidential relationship between lawyer and client is protected.

In addition, privileged documents include communications between lawyers and counterparties (unless disclosure is expressly authorised by other lawyer or parties). In-house lawyers must appear as trial lawyers to benefit from this privilege, but documents and communications exchanged with in-house lawyers are not privileged.

A confidentiality agreement can be overridden by a court order that requires information and documents to be disclosed, even if they are privileged. Legal professional privilege does not apply to criminal proceedings, except that any communications between the lawyer and his or her client for the purpose of the defence are protected from investigation.

A party can propose as many witnesses of fact as it deems necessary, but the court has discretion to call only those it considers to be relevant for the case. Witnesses usually give oral evidence (Articles 360 et seq, Civil Procedure Act). Experts can give oral evidence if this is requested at the preliminary hearing by any of the parties, and the court considers that there are questions in their reports requiring clarification, or that it is appropriate in view of the complexity of the case (see Question 19).

Witnesses can be cross-examined by all parties. If there is a conflict between witnesses and/or between witnesses and parties, the court can ex officio, or at the request of a party, hold a confrontation between the parties and one or more witnesses (Article 373, Civil Procedure Act). This procedure must be requested at the end of the questioning, and the witness will be asked to stay in court so that this can take place.

When scientific, technical or specific knowledge is required to explain the facts of the case, the parties can file an expert witness report to support their assertions. The court can also appoint an expert to give their opinion about the facts of the case.

Experts are appointed by the parties or by the court, but must provide independent opinions and reveal all conclusions of their work, regardless of how supportive or detrimental they may be to the claim of the appointing party.

Experts give oral evidence where that is requested at the preliminary hearing by any of the parties, and the court determines that there are questions in their reports that must be clarified or that it is appropriate in view of the complexity of the case. Lawyers are free to ask questions of their own choice and the court then decides whether to allow these questions, depending on the relevance and usefulness for clarifying the facts in dispute. The court can also ask questions under certain circumstances.

The party appointing the expert or requesting the court to appoint the expert pays the expert’s fees.

Decisions rendered by the courts of first instance (or commercial courts) can be appealed to the relevant provincial court of appeal, except for judgments for amounts of less than EUR3,000, which are issued in oral trials.

The appeal courts review the merits of the case, looking at questions of both fact and law, based on the evidence and legal arguments before the court of first instance. Essentially, the grounds for appeal are those needed to challenge the judgment, mainly challenging the lower court’s interpretation of the facts that have been considered proved and the court’s application of the law.

Once the decision of first instance is served to the parties, they have a 20-day period to file an appeal, and can present new evidence only in a few limited situations. Once the appeal is filed, the other party has ten days to reply. Decisions by the appeal courts can take approximately 12 to 18 months.

The Civil Procedure Act allows for several claimants to be joined in the same proceedings with one or more defendants, provided they have the same cause of action based on the same facts. Any claimant can opt out at any time.

The unsuccessful party pays the costs (legal fees) of the litigation, unless not all of the claims of the successful party have been accepted. In those cases, the judge can determine that no costs are awarded for either party.

Lawyers’ costs are calculated based on the criteria suggested by the bar associations, the economic value of the claim and the difficulty of the issue. The courts are free to determinate and decide cost amounts on that basis.

If costs are imposed, they are recovered through enforcement proceedings as soon as the ruling is final and binding, if a party has failed to pay them voluntarily.

The party applying for costs must attach any receipts proving the payment of the amounts whose reimbursement is being sought.

No interest is awarded on costs.

A local judgment is automatically enforced by the same court that issued it. Enforcement is through an enforcement claim, which is a fast-track procedure. The court examines the formal requirements of the judgment before issuing an enforcement order, and the debtor can oppose the enforcement only on very limited and exceptional grounds.

Some judgments that are not final can be provisionally enforced. If they are then revoked, the party that requested provisional enforcement must indemnify the other party for any damages that such enforcement has caused.

Spain is a party to the Rome Convention on the law applicable to contractual obligations (1980/934/EEC) (Rome Convention). Regulation (EC) 593/2008 on the law applicable to contractual obligations (Rome I) establishes the autonomy of the parties as the primary criterion; the parties can choose the applicable law for their contract.

Alongside this general rule, certain national laws cannot be excluded by the application of the law chosen by the parties in their contract. In this regard, there are some protective rules of Spanish law: those relating to consumers’ interests, labour law and insurance or distribution contracts are mandatory and parties cannot exclude them via a contract.

Finally, the application of any provision manifestly incompatible with Spanish public policy cannot be upheld.

In instances where no choice of law has been agreed by the parties, the Spanish courts will apply Article 4 of Regulation (EC) 593/2008 on the law applicable to contractual obligations (Rome I). The court will take into account relevant elements such as proximity (Article 4.4, Rome I), the most closely connected principle, (Article 4.2,3 and 4 Rome I) and the escape clause (Article 4.3, Rome I).

In instances where Rome I is not applicable (for example, for insurance contracts carried out by organisations (other than the undertakings provided for in Directive 2002/83/EC on life assurance), trusts, bills of exchange, cheques, promissory notes and other negotiable instruments, arbitration agreements, culpa in contrahendo, matrimonial property regimes, wills and succession, and so on), the conflict of law system established in the Civil Code will be used (Article 10.5, Civil Code), pursuant to which the courts will apply the laws in the following order:

In case of non-contractual claims, the following rules will apply:

The Spanish courts apply and uphold Regulation (EU) 1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (Recast Brussels Regulation) and therefore comply with the Regulation’s provisions on jurisdiction. The Recast Brussels Regulation applies to judgments from EU member states.

The rules under the Spanish Organic Law on Jurisdiction 1985 are almost identical to those of the Recast Brussels Regulation.

Spain is a party to the HCCH Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil and Commercial Matters 1965 (Hague Service Convention), which provides for a method of service through designated central authorities (in Spain, the Ministry of Justice) and, being a member of the European Union, to Regulation (EC) 1393/2007 on the service in the member states of judicial and extrajudicial documents in civil or commercial matters (Service of Documents Regulation). In all cases, service of foreign proceedings by post in Spain would constitute valid service under Spanish law provided this is done by first class registered mail with acknowledgement of receipt, but serving documents via email is not valid under Spanish law.

Spain is a party to the following international conventions:

Where a judgment is issued by a court of a non-EU member state, Spanish law provides that the enforcement in Spain of such a judgment is subject to an enforcement order (exequatur) being made. To enforce a foreign judgment, the Spanish courts apply bilateral agreements signed with non-EU countries, and EU regulations such as:

In Spain, the main ADR methods are assisted negotiation, mediation and arbitration. In all of those methods, the main rule that applies is that the parties are free to agree as to the process. An agreement reached through ADR is binding. The process requires the intervention of a third party as assistant, mediator or arbitrator.

ADR is mainly used in:

Spanish legislation encourages and promotes the use of ADR, but the parties can only be obligated to engage in it if there is a previous agreement to that effect.

The most commonly used evidence types in ADR are documentary, witness and expert evidence. The rules of the International Bar Association on the taking of evidence are generally followed in international arbitrations that take place in Spain.

A common feature in ADR is the high level of confidentiality at every stage of the procedure. Anyone involved in the mediation or arbitration process (including the mediators or arbitrators) must keep confidential any information acquired as a result of the process. They are also exempted from giving evidence concerning the information in judicial or arbitration proceedings, unless the parties agree otherwise or the evidence is requested by a criminal court

Arbitration courts have fixed fees for both arbitrators and court expenses.

In ad hoc arbitration, the arbitrator fixes the costs of arbitration. If one of the parties is ordered to pay the court fees, the costs are passed to them.

In a mediation, some rights and fees may be apportioned by the mediator depending on the type of mediation (institutional or ad hoc mediation).

The main bodies providing arbitration and mediation services in Spain are the:

There are no current proposals for reform.