This article is part 1 of a 2-part series discussing the requisites of acquiring ownership or title of immovable property under Maltese civil law. Part 1 shall deal with the initial promise of sale whereas part 2 shall deal with the final deed of sale.

A promise of sale, colloquially known under Maltese law as ‘Konvenju’, is defined under article 1357(1) as when a party (the promisor) makes a promise or offer to sell a thing for a fixed price or for a price to be fixed by one of the persons. If that promise or offer is accepted by the person in whose favour it was made (the promisee), it becomes an obligation for the promisor to sell the thing to the promisee within the time agreed upon. 

The Civil Code only sets out the broad principles on the promise to sell or to buy. However, Court judgements have amply supplemented the law in regard to the nature and implications of these promises.

The Promise of sale is therefore an agreement the seller binds himself to sell and the buyer binds himself to buy an immovable. Under Maltese Law this must be done either in the form of a private writing, or a public deed[1]. The difference between these forms is that the latter must be signed by a notary and duly registered with the Public Registry of Malta. Verbal promises to sell on the other hand are not recognized under Maltese law and thus cannot be enforced by the parties. Generally, a promise of sale is usually set to be valid, and thus binding upon the parties, for a period of between 3-6 months. If the konvenju is contained in a public deed, it must satisfy the formalities listed in the Notarial Profession and Notarial Archives Act[2].  

Promises of sale generally follow a standard format which would include clauses regulating the following; the details of the contracting parties, a detailed description of the property or properties to be sold, banking details of the payment of the deposit of the property and any other condition being an obligatory requisite for the purchase. There are certain clauses which are required to be included by law[3], such as a condition that the seller shall warrant the peaceful possession of the property, and the condition that the property is free of any latent defects. Apart from the aforementioned clauses, there are other conditions which vary depending on the circumstance, such as clauses outlining the payment due to an estate agent, which is not always involved for instance.

Following the signing of the promise of sale, the following period stipulated by said promise is used to carry out any searches on the title of the property and on the buyer and seller respectively. This is done to ensure that the property is not subject to any chargers, hypothecs or privileges which would prove to be a burden to the buyer. If any are present, then it would be the responsibility of the seller to see to it that these are extinguished before the sale of the property can be affected.

If the seller decides not to keep his end of the deal and not sell the property to the buyer, without a justified reason, the buyer may send a judicial letter, before the expiration of the promise of sale, to the seller, obliging him to abide by the promise of sale. If the seller remains in default, then the buyer must file an application to initiate proceedings in court within thirty (30) days from the expiration of the promise of sale.

The court in the case ‘Raphael Attard Flores et vs Kinematics Limited’(2006) [4] held that this takes place when the promisor has a “raguni valida, jew  ostakolu mpeditiv jew motiv gust ta’ resliment”.

It is thus clear that the main purpose of the promise of sale is to ensure that the buyer and seller are on the same page regarding the conditions of the sale prior to the signing the actual deed of sale. It also allows them a period of time to obtain the necessary information regarding the other contracting party and property in question to ensure no misinformation or fraud is at play. Finally, it also acts as a safeguard for the buyer in case the seller decides, without a justified reason, to not proceed with the sale of the property.

A promise to sell or to buy is one of the contracts most frequently entered into in Malta.  Justifications not to finalize a sale have their roots from Maltese judgements since articles on such valid reason in the Maltese law are almost inexistent.

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

[1] Article 1233 of the Civil Code, Chapter 16 of the Laws of Malta.

[2] Chapter 55, Laws of Malta.

[3] Article 1408 of the Civil Code, Chapter 16 of the Laws of Malta. If such clauses are not present, this does not mean that the seller is free from the warranty which he legally owes to the buyer.

[4] Reference: 185/2004/1

Disclaimer This article is not intended to impart legal advice and readers are asked to seek verification of statements made before acting on them.
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