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My very uneducated guess is that the property was built illegally on what is known in Spain as "rustic" land, where, in theory, no building is permitted; sort of like green belt land.
My house in Spain was built to my specification, along with one property on one side and two on the other side. The land for the 4 properties had been purchased, legally, by a fairly local family run firm of builders who had been in business for generations and were really nice people. We were all invited to various social events in their homes and one of my neighbours and I were even invited to a family wedding; lovely, genuine people.
However, when all 4 houses were completed and we moved in, the builders were unable to register the properties in Madrid - called an "escritura" same as the deeds in the UK - even though the builders had the correct building permits from the local town hall. Not trusting local lawyers, I got my lawyers from Barcelona to obtain a court order to inspect the paperwork at the town hall, and they discovered that the mayor and one of his side-kicks were issuing building permits for properties on rustic land, but there were no records of the permits in the town hall. I later found out that a developer that I became friendly with also had the same problem just around the corner from my house, but he had about 30 properties with worthless permits. Unfortunately, this is endemic in Spain, and as I've mentioned before, there are/were about a 100,000 properties built without correct permits in the Marbella area.
Being rather wary in the first instance, the contract that I had with the builders included a clause that if the property was not fully registered with all utilities connected in my name by a certain time - in theory, in Spain, you cannot get electric and water contracts until the property is registered in Madrid - then the property would revert to them, and all monies would be returned to me. And that is what happened, which coincided with me having had to return and stay back in the UK. Only good thing about my stay in that house was that the builder picked up the bills for the water, electricity and rates while I lived there, as they did for my neighbours, and that must have cost them a pretty penny.
However, I do still own another piece of land that I had been assured would be classified as being suitable to build on, but to this day nothing has happened with it because it is only suitable to use for a house and nothing else. Se la vie!
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