Written requirement when buying real estate: this is what you need to know

Written requirement when buying real estate: this is what you need to know

When purchasing real estate, there is sometimes a requirement that the purchase in writing must be. A verbal agreement is then not sufficient. This is the case when a consumer buys a home. Outside those cases, it is usually true that the sale can also be concluded orally or in some other way. Still, as a (private) buyer and real estate professional, you must pay close attention to the written requirement. Lawyer real estate law Robert van Ewijk discusses a few cases that demonstrate this.

No writing requirement when purchasing building lot for home

The written form requirement for the purchase of a home was created to protect consumers when making large purchases. One would therefore expect that the written requirement should also apply to the purchase of a building lot for a home. The Supreme Court however, ruled otherwise late last year. The writing requirement only applies to an immovable property intended for habitation. A plot of land is not residential property, the Supreme Court said. Therefore, the requirement of written form does not apply to the purchase of a building plot.

Has digital contract met written requirement?

Digital signing of documents has been widely used for several years. This has also become increasingly common in residential purchase agreements. Recently, the Amsterdam court adjudicate whether such a digital agreement also satisfies the writing requirement. This is the case, according to the court. This is because the law (Article 3:15a of the Civil Code) states that digital signatures have the same legal effect as handwritten signatures (also known as ‘wet signatures’), if the method of signature is sufficiently reliable, taking into account, among other things, the purpose for which the electronic signature was used. The buyer in the case served in Amsterdam was therefore bound by the purchase agreement.

Purchase agreement must be in one deed

Another special case was before the Arnhem-Leeuwarden court of appeal. In that case, the buyer and seller had both digitally signed the purchase agreement. However, there was not one copy signed by both parties, but two identical copies, each signed by the other party. Thus, according to the court, the requirement of written form was not met. It appears from the legislative history that this requirement is not met if there are two contiguous deeds, even if they are identical in content. Legal certainty would be compromised if the deeds had to be compared first in order to establish that they are identical. The court therefore ruled that no contract of sale had been concluded.

No writing requirement, but still writing requirement

Finally, a ruling in a case in which, in principle, no written requirement applied. In fact, it concerned the purchase of commercial real estate. The case was before the Rotterdam court. In that matter, one of the parties made the proposal to conform the NVM model contract to contract. The parties agreed on that. However, that model states that no rights can be derived from it until both parties have signed the purchase agreement. That subsequently never happened. The court ruled that because the parties had agreed on the use of a model containing a written requirement, and because it had not been signed, that no sales contract had been created.

Lawyer in dispute over real estate purchase agreement

Although a case may be simple at first glance, the application of the law is often very close. And the difference in the consequences can be significant: in fact, one interpretation leads to the conclusion that there is a purchase agreement, the other to the conclusion that there is not. Not to mention the content of that purchase agreement. Take timely contact with the real estate law attorney at Lexys Lawyers if you have a dispute over a home purchase agreement or commercial real estate.