How do we stand if the seller has not registered the property?

Property Law

Antonio Flores Vila

18th of June 2001

Q. We have just found out that the person from whom we are buying, never registered his title to the property at the time of the last sale and consequently he only has a contract of sale. It would be the previous owner who would accompany us to the Notary's office to sign over the deeds. Until now all agreements have been made with the "vendor". Our lawyer has failed to inform us of this position and we only found out through the agent. We are unsure of how we stand both with regard to withdrawal from the sale or alternatively whether it would be wise to proceed, particularly as we have paid a deposit and some monies for completion of renovation to the person who has the contract of sale and not the registered owner. Would we be entitled to this back if we withdrew?

Anonymous

A. The fact the seller never registered the property you are purchasing does not amount to a breach of contract unless it was specifically agreed that that would be the case. In fact, registering a property in the Land registry is not obligatory.

However, it is common for any property to be registered and any lawyer should advise on this, as it is precisely the protection granted to the purchaser the reason for the Land registry to be functioning. The ´vendor´, who presumably only has a private purchase contract, as otherwise he could pass ownership directly, may be perfectly dealing in the sale.

Notwithstanding this, you should ensure that all deposits are paid to a lawyer acting on his behalf. This situation is a frequent arrangement where properties in new developments are sold prior to completion, but you should have certainly been informed. A land registry certificate will automatically tell you who is the owner, and that should have been the initial search, one of ownership.

In my opinion, you would not be entitled to claim the monies back and rescind the contract, as the Jurisprudence regarding this contends that the owner does not need to be the public owner at the moment of commiting to a sale, he simply needs to be able to become the public owner and be able to pass ownership. I suggest, as you propose, to continue with the sale ensuring you now know who is who in the deal.

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