The Consumer Ombudsman assisted plaintiffs in a dispute concerning the responsibility of the keeper of safekeeping documents in developer contracting for a housing corporation. In the case a developer ("founding shareholder") went bankrupt during construction and could not complete the project. When the buyers took control of the company they found that the state of the buildings did not correspond to payments. The developer had used part of the money intended for the project for other purposes, taking the first instalment paid by each buyer and using it as a counter-guarantee for a bank guarantee.
Keski-Uudenmaan Osuuspankki acted as the keeper of safekeeping documents in the project as required under the Housing Transactions Act. According to the Housing Transactions Act, the keeper of safekeeping documents must compensate buyers if funds in a housing corporation's account are used for the wrong purpose and the keeper of safekeeping documents is aware of this. In the case in question the bank was aware that money was used as a counter-guarantee.
In the bank's view the developer had the right to use money for this purpose because it was owed a corresponding amount by the housing corporation. The developer had already paid money from his own funds before receiving payments to cover costs related to purchasing land and other project costs. Consequently the developer had the right to use payments as he saw fit. The bank argued that the developer acted in accordance with established practice in the construction field.
The Espoo District Court ruled in favour of the plaintiffs and ordered the bank to pay FIM 371,500 in compensation. The Helsinki Court of Appeal did not alter the ruling. The Supreme Court allowed the bank to appeal but did not change the final verdict. The Supreme Court said that payments had been used for purposes other than construction, which is prohibited by the Housing Transactions Act. The bank as the keeper of safekeeping documents was consequently responsible for damage suffered by the buyers.