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Property purchased….but…..?

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Posts: 15
Community Member
Topic starter
(@genki)
Active Member
Joined: 4 months ago

It’s been a long day. We are exhausted mentally and physically just having purchased our Portuguese property including a few acres of rustic land. We are delighted but equally terrified as whilst signing the papers with the lawyer we were informed that in Portuguese law any adjoining neighbour over the next 12 months can purchase the rustic land from us at the contract price (a very very low number). That would be devastating as we bought both together and one without the other would be worthless to us. I’m not sure what to make of this and how worried to be, but has dampened our celebrations tonight now worrying we could lose everything. Any thoughts or knowledge on this law? Have we misunderstood this? (I hope we have).

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Posts: 214
Ask our Expat Consultant
(@thomasribatejo)
Estimable Member
Joined: 5 years ago

There is a law of precedence which applies to most rustic land, where neighbours have a right of first refusal, effectively. If you had a lawyer working for you in the purchase, they should have advised you of this in advance (as this is a well known, standard and essentially unavoidable legal issue) and obliged the seller to follow the process, advertising and communicating so that neighbours could exercise that right, or waive it.

If for whatever reason this was not done, then yes, there is a large risk here.

You refer to signing papers with a lawyer - perhaps you mean at the notary, if you've completed the purchase? In any event, if you used a lawyer to verify things prior to purchase, speak to them to find out more about this. It's just possible it was actually covered off. If you didn't use a lawyer, then you are likely to now need one, to find out if the sale was advertised by the seller as the law of precedence requires; and if not, to communicate with neighbours now on your behalf, to see if they are prepared to waive their right. This isn't a friendly chat, it's a defined process with timescales.

I wish you well with this, and am so sorry you've had this additional stress. In very many cases, neighbours have no interest - but we have encountered instances where they did, and a sale has been forced.

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Posts: 15
Community Member
Topic starter
(@genki)
Active Member
Joined: 4 months ago

Thank you for your reply. Yes you are correct the signing of the papers was with our lawyer (notary) with the sellers and the estate agent in attendance. What has heightened our fears is that we went for a walk around the land and the property owner at the end of the land mentioned that they would have wanted to buy the land but also said it’s nice to have neighbours now… so even more confused and stressed. 

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Posts: 214
Ask our Expat Consultant
(@thomasribatejo)
Estimable Member
Joined: 5 years ago

OK, so a notary works neither for you nor for the sellers, but for the State, effectively. Their role is to formalise/validate/process the contract of sale. They are a different thing entirely to a lawyer acting for you or for the seller.

I'm therefore unclear whether you had a lawyer employed by you to gather and assess the documents relating to the property. This would have happened over a number of weeks in advance of the signing. That is the person and process who should have picked up on and advised you of the issue in advance. Did this happen? 

If you had no lawyer, but proceeded with seller and agent to the notary, you have had no independent advice, and so may have inherited a problem. If so, you would be well advised to now get a lawyer to help you investigate and resolve it. 

It sounds likely - but this is speculation - that the sellers at best spoke to neighbours but didn't do the formal process. They may have done nothing. In either event, no-one from your side insisted they do it.  If so, this remains a liability until resolved formally, or until it times out. I am sorry if this seems blunt, but I believe you are right to be worried.

(It is just possible that the process did happen, but if I read it correctly, and the notary said this risk remains, then this seems unlikely.)

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Posts: 2170
VIP Member
(@old-bloke)
Noble Member
Joined: 14 years ago
Posted by: @genki

We are delighted but equally terrified as whilst signing the papers with the lawyer we were informed that in Portuguese law any adjoining neighbour over the next 12 months can purchase the rustic land from us at the contract price (a very very low number).

It's not a case of the neighbour exercising their right of preference (Article 1380 of the Código Civil) buying the land from you. Your purchase would be deemed null and void and you will have to get your money back from the vendor. 

I don't understand where your informant is getting 12 months from. Under Article 1410 of the Código Civil it's 6 months from the date the preferential party becomes aware of the essential elements of the sale, one of those essential elements being the price it was sold for.
If for example the preferential party became aware of the sale 01/01/22 but didn't become aware of the price paid until 31/12/22 their preferential rights will exist until 30/06/23.

Thomas has hit the nail on the head, instruct a solicitor and get it squared away otherwise it could be hanging over your head forever.

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