ON ISSUES ARISING FROM THE ACQUISITION OF PROPERTY SOLD BY AN UNAUTHORIZED PERSON TO A BONA FIDE PURCHASER (BASED ON AN ANALYSIS OF COURT PRACTICE)

Abstract

The problem discussed in this article has three extreme solutions: imposing all risks related to potential errors on the owner, imposing all risks on the buyer, and finally eliminating all risks through a registration system and record-keeping that makes all rights clear and verifiable.

The operation of the rule of limitation on vindication is connected to the existence of a series of circumstances: 1) the seller is acting in good faith, which implies the good faith of the seller concerning the owner’s status. Regarding movable property, this means that the seller has possessed the item, while for immovable property, it implies their registration as the owner with the relevant authority; 2) there is a contract between the seller and the buyer aimed at transferring ownership rights; 3) the contract is for valuable consideration; 4) the item has been actually transferred to the buyer and is not excluded from circulation or restricted in circulation; 5) the item has been voluntarily relinquished by its rightful owner. The idea that the buyer is obligated to verify the seller’s rights is currently very relevant, especially concerning real estate, where ownership rights are transferred only after state registration. Generally, the state registration system for the transfer of rights to immovable property is established to ensure the transparency of all rights and ultimately to eliminate cases of limitation on vindication concerning immovable property. The registration procedure for real estate introduces a direct description of the owners, resulting in the loss of meaning for all presumptions that are currently contradicted by irrefutable evidence. The fact of registration in the public registry confirms the emergence of rights to property and guarantees the authenticity of those rights through confirmation by the state with a public act. According to the goals of the Civil Code, the registration act serves as public confirmation of the validity of rights arising from a civil transaction.

The article also discusses the theory of “the lesser evil,” which posits that a decision made in favor of one party should bring as little harm as possible to the other party. In other words, the dispute is resolved in favor of the party with less chance of protecting their property interests at the expense of a bad-faith seller.