Selling an Occupied Dwelling — the Specifics
The sale of residential property where the apartment is rented has its own legal specificity: the transaction does not merely bind seller and buyer — a third person, the tenant, remains within it. A properly planned sale anticipates this circumstance in advance and reflects it in the contract. The basic framework is that of sale: the seller transfers ownership and documents and delivers the property; the buyer pays the price and receives the property. In the case of an occupied apartment, both wings of the transaction fill with risks: the price must reflect the occupancy by lease, and the delivery — the actual circumstances.
The Buyer of a Rented Apartment — Who Becomes the Lessor
The central norm governing the sale of an occupied apartment is Article 209 of the Code: if a person acquires a rented apartment, that person takes the place of the lessor. The general rule says the same: under Article 572, if the lessor alienates the rented thing to a third person after its transfer to the tenant, the acquirer takes the place of the lessor, and the rights and obligations arising from the tenancy relationship pass to the acquirer.
The practical significance is twofold. For the buyer: the purchased apartment is not free — the tenancy continues, and eviction is possible only on grounds established by law. For the seller: occupancy by lease is not an obstacle to the transaction, but disclosing it is a matter of good faith and is also reflected in the price.
Passing of Risk — the Moment of Delivery
Together with the delivery of the thing sold, the risk of its accidental destruction or damage passes to the buyer, unless the parties have agreed otherwise — this rule comes from Article 482 of the Code. If the seller, at the buyer’s request, sends the thing sold to a place other than that provided for in the contract, the risk passes to the buyer from the moment the seller hands the thing over to the carrier or to a person responsible for its performance. In the sale of residential property, the moment of the passing of risk is fixed in practice by the delivery act, and it is precisely this act that decides who bears, for example, the consequences of damage occurring on the eve of delivery.
Selling the Same Thing Several Times
A frequent problem on the residential property market is the sale of one and the same thing to more than one buyer. Article 499 of the Code establishes the rule: if a thing is sold several times, the right securing the obligation is transferred to each subsequent buyer, and the buyer may, within the limits of the buyer’s rights, present claims to the respective seller in this chain of sales. The practical meaning of the norm is that each buyer retains a position against the buyer’s own seller: the securing right is transferred along the chain, and whoever cannot receive the thing presents claims arising from the contract against the own seller. The registration system significantly reduces this risk, but in the days between the transaction and the registration, caution remains necessary.
Selling Rights, the Delivery Act and Documentation
Transactions connected with residential property are often sales not of the thing itself but of a right — for example, a claim or a right to a building under construction. Article 498 of the Code establishes: the rules governing the sale of a thing apply correspondingly to the sale of a right or other property; in the case of the sale of a right, the seller bears the burden of substantiating the genuineness of that right and the expenses of its transfer; and if a right that gives the possibility of possessing a thing has been sold, the seller must transfer to the buyer a thing free of defects both in the material and in the legal sense.
In the sale of an occupied apartment, the role of documentation grows particularly: alongside the contract, the delivery act matters, recording the condition of the property, meter readings and the handing over of keys. This act also records what concerns the tenancy: the status of rent payments and the date from which the buyer becomes the recipient of the rent — details that pre-empt later disputes.
Frequently Asked Questions
The most frequent questions connected with the sale of residential property, with short answers.
What happens when a rented apartment is sold?
The acquirer takes the place of the lessor: the rights and obligations arising from the tenancy relationship pass to the acquirer. The tenant remains in the apartment, and eviction is possible only on grounds established by law.
When does the risk of destruction pass to the buyer?
Together with the delivery of the thing, unless the parties agreed otherwise. Where the thing is sent to another place — from the moment of handing it over to the carrier.
What happens if one apartment is sold several times?
The right securing the obligation is transferred to each subsequent buyer, and each buyer, within the limits of the buyer’s rights, presents claims to the buyer’s own seller.
How is a right, rather than a thing, sold?
The rules of the sale of a thing extend correspondingly to the sale of a right: the seller secures the genuineness of the right and the expenses of transfer, and where the right gives possession — the thing must also be free of defects.
How We Help on Legal.ge
We assist with the full cycle of selling an occupied or a free dwelling — from preparing the contract to the delivery act. Contact us on Legal.ge — a sale is the transaction where every detail must be agreed in advance.