legal counsel in european real estate conveyances: brokers and notaries ola jingryd, jur. dr. malmö...
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Legal Counsel in European Real Estate Conveyances: Brokers and Notaries
Ola Jingryd, Jur. dr.Malmö University
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BackgroundThree legal families in the EU
◦ Civil law, common law, Scandinavia
Three/four Basic Models for Conveyances
Two key players◦ The Swedish broker and the Latin notary
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General observation
The Swedish broker and the Latin notary seem to perform, in great part, the same functions in real estate conveyances, and to have similar duties.
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Licentiate thesis (2008)
Compared the Swedish broker and the Latin notary with respect to:◦ Relation towards buyer and seller◦ Tasks and duties performed
Swedish law compared to nine notary countries:◦ Argentina, Belgium, Brazil, France,
Germany, Mexico, Portugal, Puerto Rico, and Spain
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Licentiate thesis, findings
Duty of impartiality
Counseling role
Contract-engineering
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Plans for step 2
Law-and-economics analyis◦Transaction costs◦Market failures
Empirical studies difficult to effectuate
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Doctoral thesis
Compare duty to counsel
Legal study, not ”empirical” study
Sweden and France
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Swedish Conveyance Process
No formalities except written contract signed by the parties◦4:1-3 of the Land Code (1970:994)
Traditionally two deeds◦Contract◦Bill of sale – on day of possession
Title registration at Land Registry◦Declaratory only
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Swedish Conveyance Process
No professional intervention required
In practice, however:
◦More than 90 % of all conveyances are accomplished through brokers
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French conveyance processPre-contract – avant contrat
◦Binding between buyer & seller, not to third parties
◦Different kinds: compromis de vente, promesse de vente, etc.
Sales deed – acte de vente◦ Acte authentique – notarized◦Binding to third parties, enforceable
Title registration declaratory
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Duty to counsel – Swedish broker
Legal basis:
◦Estate Agents Act (2011:666), esp. 8, 16, 21 §§
◦Case law from civil and administrative courts as well as the Estate Agents Inspectorate
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Duty to counsel – Swedish brokerDuty to verify
◦Right of disposal, encumbrances, joint facilities
◦Not zoning & planning! ◦Complemented by duty to
investigateDuty to disclose information
◦Concerning the property and other relevant factors connected to the transaction
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Duty to counsel – Swedish brokerDuty to advise
◦Matters of import to the transation◦Legal, financial, technical
Contract-engineering◦Tailor the deeds to the needs of the
transaction at hand◦Intertwined with duty to advise
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Duty to counsel – French notary
Legal basis:
◦Art. 1382 of the Code Civil
◦Extensive case law from the Cour de cassation
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Duty to counsel – French notary
Duty to verify◦Including zoning & planning!
Duty to disclose information
Duty to advise
Contract-engineering
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Implications, future researchEconomic effiency
Institutional robustness◦Does it work?◦Can it work◦ Incentives!
Part of housing market ◦Self-owned homes large portion of total
market◦Access to housing on fair terms