Contingent assets and liabilities
The Group’s main contingent assets and liabilities on the date these consolidated financial statements were drawn up, are set out below:
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During the 2008 financial year, a Group subsidiary in Italy terminated a service agreement with the construction company entrusted with the tourism
complex project that the subsidiary company was developing, with various breaches of the agreement as grounds for doing so. As a result of this termination,
the construction company filed a suit against the Italian company claiming damages in the amount of approximately €15 million.
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A counterclaim was filed on behalf of the Group company in Italy on the grounds that the termination was justified due to contractual breaches; to this end,
compensation of approximately €33 million is being sought from the construction company for damage and losses caused. The tribunal appointed a technical
expert, who quantified the damages in the construction company’s favour in the amount of approximately EUR 1.4 million and in the Sotogrande Group’s
favour in the minimum amount of EUR 6.4 million and maximum amount of approximately EUR 9.1 million.
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The company has already received payment for the damages amounting to EUR 5.1 million from the first-demand bank guarantee provided by the Intesa San
Paolo, S.p.A. where applicable, in order to seek payment of additional damages, it must be considered that the construction company would pay a part under
the terms of the court approved restructuring plan.
However, for reasons of prudence and given the financial situation of the Group as at 31 December 2013, the attached consolidated balance sheet includes a
liability for the sum of EUR 6,771 thousand under “Current provisions”.
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The owner of a tourist complex has initiated arbitration proceedings against a Group company in Italy, claiming damages for a delay in construction works and
demanding demolition of part of the works and the execution of some additional works. The Group company has filed a counterclaim for, among other things,
errors in the maps attached to the lease agreement, which gave rise to errors in the sizes of the plots. The arbitral proceeding is currently awaiting the expert’s
report.
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The owners of a hotel in Belgium have started arbitration proceedings against a Group company in Belgium and its guarantor. Pursuant to the latest request
before the Court of Arbitration, they are seeking payment of approx. €910,000 or approx. €414,000, where applicable.
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The owner of premises in France filed a suit against a Group company claiming compensation for eviction; the Court ruled that the compensation should
amount to approximately EUR 4million. This decision has been appealed to the competent courts and the hearings have been set for 15 January and 12March
2014.
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The Group has appeared in the necessary bankruptcy proceedings of Viajes Marsans, S.A. and Tiempo Libre, S.A. in relation to the unclaimed estate of Mr.
Gonzalo Pascual Arias and Mr Gerardo Díaz Ferrán, and in the voluntary bankruptcy proceedings against Ms. María Ángeles de la Riva Zorrilla, for the
purpose of claiming the outstanding amounts. Said balances were provisioned in consolidated financial statements in the amounts deemed not recoverable.
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The Group has appeared in the voluntary bankruptcy proceeding of the Orizonia Group for the purpose of claiming the outstanding amounts.
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A Group company in Spain served a notice that it was terminating a lease agreement due to non-fulfilment of obligations attributable to the owner of the
property. The owner initiated a claim for performance of the contractual obligations consisting of rent payments not made since the early termination of the
lease. The Group has lodged an appeal. the deliberation, vote and ruling date is yet to be set.
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The owner of a hotel has filed a suit against the Group claiming certain contractual obligations. The Group company has lodged an appeal and extraordinary
petition for review on the grounds of breach of procedure before the Supreme Court.
27.-
INCOME AND EXPENSES
27.1
Income
The breakdown of this heading in the consolidated comprehensive profit and loss statements for 2013 and 2012 is as follows:
REPORT ONTHE CONSOLIDATED FINANCIAL STATEMENTS
99
