Alex Trelinski
THE Balearic Islands government will have to pay €96 million in compensation over breaching an urban planning deal with a German-owed developer.
The ruling from the Balearic Supreme Court dismisses a government appeal over a lower court decision that also ruled that it broke an agreement made in 2013 over the development of the Sa Muleta II urbanisation in Soller.
The Balearic Islands government has two months, according to the judgment, to pay €63.5 million euros as a main claim plus another €30 million in interest dating back to the filing of a first lawsuit in 2009.
The vice-president, Antoni Costa, said the award would make ‘a huge hole in its financial coffers’.
He did not rule out appealing to Spain’s Constitutional Court but promised that no ‘essential services’ would be cut.
Costa indicated that the administration would have to pass an ‘extraordinary credit law’ to pay the compensation.
The money goes to Birdie Son Vida owned by businessman Matthias Kuhn and is the largest ever fine imposed in the history of Balearic urban planning legal cases.
It brings to an end a 14 year battle over the German developer’s plans to build 33 luxury villas at Soller.
The land was reclassified as rural land by the government in 2008 which led to the start of a long and contentious series of litigation.
In 2013, the government and Birdie Son Vida reached a deal over construction at the site with another law change allowing building to go ahead.
A new twist was Soller Town Hall then refusing to allow the development since it had autonomy over planning matters.
The matter went to court and the ruling was in Soller’s favour.
A further twist saw a new regional administration come into power in 2016 and it suspended the land reclassification and the following year, the plot returned to rural land status.
The decision meant the 2013 agreement between the government and Kuhn and the government was void, and Birdie Son Vida initiated legal action for compensation, winning a High Court ruling in 2022.
