William Shakespeare wrote the comedy in 1596, The merchant of Venice, which told the story of a merchant who, for deal with your debtsHe is forced to request 3000 ducats from a lender, Shylock, who made the only condition that he find a guarantor who would guarantee the return of what was lent.
This guarantee was that in the event that main debtor and guarantor did not comply with the payment of the debt incurred within a period of 3 months, the guarantor would have to deliver a pound of his own flesh.
After the indicated time has elapsed without the main debtor and the guarantor complied with the stipulations, the lender, goes to the Grand Duke of Venice, the then authority of the city, to have the contract executed in its entirety and even when he asks for clemency, the creditor is only willing to accept other alternative proposals to the contract that are even more burdensome for the debtors.
Second Chance Law
After this brief exposition of the comedy and taking into account the actions of the State, we must know what the position of the current Democratic State of LawThat is, we must ask ourselves the following question: Is the State an instrument to guarantee the payment of debts? Or yes, on the contrary, is it the legislator who has to create mechanisms that mitigate the effects of payment and even forgive existing debts in whole or in part?
Well, in a first point, we must affirm that in order for citizens to be protected by the State, the legislator of our times creates the Second Chance Law, Law 25/2015, of July 28, second chance mechanism, reduction of financial burden and other social order measures, which covers the need that has been claimed "for some time" and whose main purpose is precisely the creation of legislation that protects natural persons, and effectively alleviates the consequences of the economic crisis in thousands of Spanish families.
This demand was echoed in the judicial sector, who always emphasized the need for these tools that our country lacked, and on the contrary our European brothers had had for years, these legal instruments being the ones that allowed the protection of natural persons who were in a situation of insolvency. or with little purchasing power, thus reducing their debts or at least trying to ensure that the measures adopted were as least burdensome as possible.
This system can be considered somewhat tortuous because initially an attempt at an extrajudicial agreement is required and in the event that this fails, it forces the debtor to initiate a judicial procedure in which he will see his entire assets liquidated.
Its justification, or what is the same, the reason for its existence is the need to prevent the second chance benefit from being used fraudulently, and this is stated in the explanatory memorandum of the Law, when it states that these second chance mechanisms establish the necessary controls and guarantees to avoid strategic insolvencies or facilitate selective payments.
What is this Law about?
This law is really about, on the one hand, allow that he who has lost everything by having liquidated his entire assets in benefit of your creditors, can be freed from most of the outstanding debts after the aforementioned liquidation and on the other hand, to quantify the improvement in fortune that, eventually, will allow said benefit to be revoked for reasons of justice towards the creditors, thus achieving balance and the necessary justice that any legal norm must inspire.
Hence, in the preamble of the new consolidated text of the Bankruptcy Law, it reminds us that Spain has some very important and necessary issues pending, such as the transposition of Directive (EU) 2019/1023, whose purpose is establish alert mechanisms for the risk of insolvency, or regulate with more coherence the processes of preventive restructuring of debts, as well as simplify bankruptcy law, increase efficiency, reduce costs, and expand the benefit of debt relief and establish formulas for exoneration or remission of payments in exceptional cases , such as the extrajudicial payment agreement.
Likewise, this law also contemplates, when in its sole transitional provision it states that the content of articles 91 to 93, both inclusive, of this consolidated text, correspond to articles 34 bis to 34 quater of Law 22/2003, of 9 of July, which were introduced by Law 25/2015, of July 28, of second chance mechanism, reduction of financial burden and other social measures, and which will come into force when the regulatory development is approved.
This is why it can be considered that this Second Chance Law together with Bankruptcy Law are fundamental tools for the preservation of the business fabric and employment and thanks to both mechanisms, urgent measures have been able to be adopted in the context of the COVID health crisis.
Perhaps with this work a scenario opens where the existing conflict between the legal justice and moral conscience, thus being the Second Chance Law a legal resource that natural persons resort to, both individuals as self-employed, that they cannot pay the debts incurred and logically prevent circumstances similar to those dramatized from occurring.
