Understanding Condo Contracts

Legal Options
Atty. Edwin Calica Cacayorin, Jr.

In buying a condominium unit, the point of litigation is most often not on what is provided in the contract, but on the circumstances involved in the transaction. The contract itself is legally worded in such terms as may appear fair to both parties.

Do request however from the seller to fully explain (a) the terms of payment, in case of default in paying the premium what happens; (b) the delivery or, more interestingly, the non-delivery of property on its due date what are your options; and (c) whether there is a provision that the buyer can rescind the contract, if there is what are the grounds.

To rescind a contract simply means that one can walk away from the agreement if the other party does not comply with its obligations. The power to rescind is fundamentally rooted in the law and is read inherently in all contracts. It is better though to ask the seller about your right to rescind as it may have implications that are already covered in the contract.

Be conscious of the reputation of the developer and the contractor. Check the title of the property for adverse claims, mortgages and other encumbrances. Investing in real estate may be highly profitable in the future but it is also risky. You might end up buying a unit that has been mortgaged or worse, had earlier been sold to another.

Consider too that what you are buying is what you see physically in the unit and, in case of pre selling, what it would look like based on how you imagine the blue print as will be constructed. The size of the pipelines for the water and for the sewerage is always a concern. Flushing a toilet with insufficient water may not be a legal issue but, more importantly, it is one of convenience. Inspect as much as you can the construction of the unit as well as the blue print, and if need be, consult an architect or an engineer.

Do not completely trust the agent of the seller. You may chance upon an outstanding deal to an excellent property constructed by a well-reputable developer with all the documents in order but you gave your money to the wrong person. Inquire with the seller on who to deal with, if he or she authorized in writing to sell the property and to receive the payment or premium. Finally, always document each transaction and keep the originals as well as photocopies organized for your legal protection

Source // Condocentral issue
              Vol.ll No.5 March 2008

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