Withdrawing from a preliminary agreement for the sale of a property

A preliminary agreement (umowa przedwstępna) is concluded between the buyer and the seller. Its purpose is to protect both parties to the transaction. It is most often concluded when the date of sale has to be postponed. Find out whether withdrawal from a preliminary agreement for the sale of a property is possible.

When does a preliminary agreement cease to apply?

A preliminary agreement may be concluded for various reasons, most often related to finances or administration. The agreement always specifies the date until which it is binding. This does not mean, however, that once its term has expired the owner may take further steps concerning the property. A different situation arises when the terms of the agreement are set aside.

A preliminary agreement for the sale of a property may set out the obligations of both parties. It may include, among other things, the conditions for withdrawing from the agreement. Otherwise the matter may become somewhat complicated. It is therefore worth thinking about this when agreeing the terms. The least troublesome option is withdrawal by mutual consent. This type of document is not a reciprocal contract.

If the final agreement has not been signed within a year of the day on which the preliminary agreement was drawn up, its conclusion can no longer be demanded. A preliminary agreement for the sale of a property is organisational and preparatory in nature. It is not a definitive document and does not have a dispositive effect.

READ ALSO – HOW TO PREPARE A PRELIMINARY AGREEMENT FOR THE SALE OF A PROPERTY

Withdrawing from a preliminary agreement for the sale of a property – compensation

The only compensation possible in the case of withdrawal from a preliminary agreement for the sale of a property is limited to reliance damages (ujemny interes umowny). This is because the agreement provides for compensation for the damage that one of the parties suffered by believing that the final agreement would be concluded. However, a preliminary agreement may contain provisions concerning a deposit (zadatek). In that case there is the option of claiming it. We can therefore recover the deposit, the costs of negotiations, lost earnings, the costs of travel and legal assistance, as well as costs related to valuing the property.

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