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Breach of contract in the sale of homes

Real Estate
Breach of contract in the sale of homes

The Civil Code establishes a clear definition of what a contract is, and defines it as the action in which one or more persons (parties) agree to be bound, with respect to another or others, to give something or provide a service.

When one of the parties does not comply with the obligations derived from it or with the execution of the terms that govern the legal business, we face what in legal practice is known as breach of contracts, in the event of the sale of a property the situation does not vary much, since it is a legal business constituting the transfer of ownership of a property as consideration for the payment of a monetary amount.

Contractual breach in the sale of homes occurs when the seller or agent does not fulfill their part of the obligation contracted in the sale contract that has been previously signed by the parties.

"The Spanish legal system on consumer matters, usually interprets contracts in favor of the consumer and requires the application of the rule that is most favorable to the consumer, all with the purpose of granting the consumer the greatest possible protection against possible breaches of the sellers, as long as it has been submitted to the signing of an adhesion contract where he has not been involved in the legal formation of the clauses that accompany it ".

We will study the cases in which the breach of the housing sale contract proceeds:

Housing off plan

In the case of an off-plan home, if any of the parties fails to comply with their obligations, said non-compliance will lead to the application of article 1124 of the Civil Code: which establishes: each party may demand compliance with the agreement or the resolution of the sale, with a possible compensation for damages.

Housing already built

When the legal business is on a built property, the part that has not complied is the one that will run with the causes of non-compliance as follows:

Suppose a case of delivery of a reservation, if the one who became a reservist is the one who falls into the default, he will lose the amount delivered as a reservation, now, if the seller is the one who fails to comply with his part of the agreement, he must return the amount delivered as a reservation.

That is, if it is the buyer who fails to comply, desisting from the reservation or not formalizing the sale in the stipulated time or the previous deposit contract, he will lose the amount of the reservation, as compensation for damages caused to the seller. , for not having been able to sell your home to potential third-party buyers during the reservation period.

However, if the seller breaches his commitment and sells the house to a third party within the reservation period, he will be subject to indemnify damages to the buyer, apart from returning to the buyer the amount given by reservation.

What are the obligations of the parties in a sales contract?

The Buyer has the obligation to deliver to the seller the agreed amount for the transfer of the property, together with the documents that prove his identity and the legality of the funds.

The seller has the obligation to deliver the property object of the sale, not another property. That is, if the purchase and sale of an apartment is agreed, a commercial premise or a plot of land cannot be delivered and not vice versa.

What happens if the business is not done within the stipulated time?

In the event that the parties have agreed to a deferred payment for the home and the buyer does not meet the deadlines, the seller cannot rescind the contract. "The buyer would continue to be the owner of the property and the seller could file the corresponding lawsuit claiming the amount owed."

In this case, the option that remains for the seller is to request the termination of the contract, if there is a breach in the payment in installments of the price of the house by the buyer, provided that it is incorporated into the contract as a terminating cause of the contract.

Who is responsible for hidden vices?

In the event that there are hidden defects, on the property to be delivered, the buyer may take action against the seller to make him liable for eviction and hidden damages.

What happens if there is absence of licenses?

In these cases, the contract can be declared void due to defects of consent, because the developer-seller has concealed from the buyer the existence of building defects of an urban nature.

Contact us at Tel. (+34) 936 26 49 49, or send us an email to info@forcamabogados.com, and our lawyers specialzed in  home sales contract will study your specific case. 

At Forcam Lawyers we offer quality legal advice to national and international clients throughout Spain.