The Deed of Sale: This article is part 2 of a 2-part series discussing the requisites of acquiring ownership or title of immovable property under Maltese civil law. Part 1 discussed the initial promise of sale whereas this article will now discuss the final deed of sale.

Article 1346 of Chapter 16 of the Laws of Malta provides for the definition of a contract of sale as follows:

‘A sale is a contract whereby one of the contracting parties binds himself to transfer to the other a thing for a price which the latter binds himself to pay to the former’

Article 1347 of Chapter 16 provides on when the sale of the thing being sold is deemed to be complete. In fact;

‘A sale is complete between the parties, and as regards the seller, the property of the thing is transferred to the buyer, as soon as the thing and the price have been agreed upon, although the thing has not yet been delivered nor the price paid; and from that moment the thing itself remains at the risk and for the benefit of the buyer’. 

 In the case of ‘Vella vs Commissioner Gunner Steward’ (1953)[1] The court declared that the sale of a thing is completed upon agreement on the thing subject to sale and the price, irrespective whether the price has been paid up or not. Moreover, the court also explained that the sale of res aliena[2] is null. The court also explained the difference between an ordinary sale and a Pactum de Reservati Dominii, where the price is paid in installments and the seller retains ownership until the complete price has been paid up.

Of noteworthy to mentioned is that a sale can be either voluntary or necessary. In the case of a voluntary sale, as the name suggests, both parties enter into a contract of sale willingly and spontaneously. Whereas in the case of a necessary sale, the vendor suffers the sale of his property due to a force which is beyond his control. Examples of this type of sale include but are not limited to; Judicial sale by Auction and expropriation.

The special requisites required for a sale to be considered as valid are three: (i) The Capacity of the parties; (ii) The double object of the sale i.e. The thing being sold, and the price being paid in respect thereof and (iii) The form of the contract entered between the parties. In turn each one of the requisites have their own sub requisites.

In the case of ‘Stivala vs Borg Carabott’ (1912) the court delved into article 1370 of Chapter 16 which article states as follows: ‘All things which are not extra commercium[3], may be sold, unless the alienation thereof is prohibited by any special law’

Furthermore, the court also stated that the phrase ‘all things’ includes movables and immovables; corporeal and incorporeal, present and future things.

For a thing to be the object of a sale, the sale must be; (i) Possible, (ii) Lawful, (iii) the thing being sold must belong to the vendor, (iv) The thing being sold must not be perished; and (v) the thing being sold must be in commercio.

Formalities of a contract of sale

The formalities of a contract of sale require a distinction to be made between immovables and movables. Article 1363 of Chapter 16 of the Laws of Malta provide that the sale of immovable property shall be null if the said sale (i) is not made by a public deed ad validatatem[4] or (ii) if the purchase is made pro persona nominanda.[5]

In the case of ‘Caruana vs Grech’ (1917) the court held that the sale of an immoveable property is perfected, and the right of ownership transferred with (i) the agreement of the parties on the object and the price and (ii) the publication of the contract of sale. When these 2 elements concur and the contract of sale is registered in the public registry, the contract becomes valid erga omnes.[6]

Article 1379 of Chapter 16 states that the publication of the contract of sale is tantamount to delivery. Therefore, the transfer of ownership and the delivery coincide. However, the same cannot be said with regard to movables as the completion of the contract and the delivery do not coincide.

The expenses of the sale as to be charged at the expense of the buyer[7] whilst brokerage and expert fees are to be borne by the buyer and the seller, one half each.

So, what are the effects of a sale?

The effects of a sale are several, including the transfer of the right of ownership of the thing sold, transfer of the Periculum rei[8] and the Commodum rei[9], he sale creates several obligations on the part of the seller as well as several obligations on the part of the buyer. 

Amongst several obligations of the seller, to name a few there is; the obligation to deliver the thing sold, to provide the warranty of Peaceful possession also known as ‘Garanzija Paċifiku Pussess’ and to provide the warranty against latent defects.

For more information or assistance related to Contracts and Property Law please contact Dr Robert Tufigno and Dr Delilah Vella.  

[1] Volume 37C (1953), Part No. 2, Section, Page 632.

[2] Something that belongs to someone else.

[3] A thing outside commerce – A Doctrine originating in Roman law holding that certain things may not be the object of private rights and are therefore insusceptible to being traded.

[4] A condition required for the validity thereof.

[5] Without the parties being known.

[6] Against all third parties.

[7] Article 1361, Chapter 16 Laws of Malta.

[8] The risk of the thing.

[9] Benefits of the thing.