Court ruling accepting that the buyers of a real property, being unaware that the part of the property sold to them resulted from a subdivision and was non-compliant with minimum plot size requirement and non-buildable, were defrauded by the sellers, who represented to them a false fact as true — namely, that the property sold was compliant with the minimum plot size requirement and buildable — and on that basis the buyers concluded the sale and purchase contract at issue. Consequently, the defrauded buyers are entitled to damages, that is, they are entitled to seek compensation for every loss they have suffered, including the price they paid to the sellers and the fees they paid to engineers for the preparation of studies aimed at obtaining a building permit, which was ultimately not granted by the planning authority.
The judgment in detail: Areios Pagos 89/2023, A1, Civil Division:
In each of the above contracts, the sellers assured the buyers that the property being transferred was compliant with the minimum plot size requirement and buildable. The minimum plot size requirement in the area was set by a decision of the Prefect of Larissa, which provided that plots with a minimum surface area of 400 sq.m. are deemed compliant and buildable, with the result that the area of plot No. 43 remaining after the above sale became non-compliant, since its surface thereafter amounted to 359.86 sq.m. Likewise, the remaining property of 320.14 sq.m., which adjoined plot No. 44, became non-compliant and non-buildable, since it resulted from a private subdivision. After the contract was signed, the buyers, in order to erect a building on property No. 43, submitted the relevant file to the Planning Authority, which, however, did not grant them the requested building permit, since the subdivision of the above property was unlawful and gave rise to non-compliant and non-buildable plots resulting from a private subdivision.
Furthermore, the part of property No. 43 that came into the buyers’ hands could not become compliant and buildable through its annexation to the adjoining property No. 44, since it resulted from the latter’s subdivision through the fault of the sellers, which had as its consequence the creation of a non-compliant and non-buildable property concerning the remaining 359.86 sq.m. portion of property No. 43. The buyers became aware of the lack of minimum plot size compliance of the part of property No. 43 sold to them when they applied to the Planning Authority for a building permit to erect a structure thereon.
From the foregoing, in conjunction with the sellers’ statements included in the above contracts as to the compliance of the properties sold, it is established that the sellers, although they knew that the minimum plot size compliance of properties Nos. 43 and 44 — according to the topographical diagram approved by the Town Planning Council — concerned the area of 680 sq.m. for each property, falsely represented to the respondents on appeal that each of the parts of the properties transferred separately was compliant and buildable, whereas, given their surface area, this was false. As a result, property No. 43, after its subdivision, became non-compliant and non-buildable — a fact which, had the buyers known it, that is, had they known the true legal status of property No. 43, they would not have proceeded to purchase the part thereof.
As a result of the sellers’ above conduct, the buyers suffered a loss of EUR 74,131.32, and additionally, due to the sellers’ tortious conduct, they suffered moral damage and are entitled to pecuniary compensation in the amount of EUR 10,000 each.
- See also article Property Purchase
- See also article Property Sale
- See also article Action for Partition of Property
- See also article SYPOTHA – Unauthorized Constructions
- See also article Fines for Unauthorized Constructions
- See also article Annulment of SYPOTHA Decision
- See also article Acquisitive Prescription
- See also article What is the KAEK?
- See also article Pre-Notation of Mortgage
- See also article Eviction of Tenant
- See also article Professional and Commercial Leases
- See also article Correction of Manifest Error – Unknown Owner – National Land Registry
FREQUENTLY ASKED QUESTIONS ON FRAUD AGAINST PROPERTY BUYERS BY SELLERS
1. I bought a plot that turned out not to be buildable. What am I facing?
Where the seller assured the buyer in writing or orally that the property was compliant with the minimum plot size requirement and buildable, while in fact knowing the contrary, the offence of fraud is established under Article 386 of the Penal Code (PK) (criminal liability) and Articles 147, 149 and 914 of the Civil Code (AK) (civil liability). Case law, with the leading example of Areios Pagos 89/2023, recognises the buyer’s right to full compensation. Coverage extends to the price paid, engineers’ fees for studies and permits that were ultimately not issued, and pecuniary compensation for moral damage. The inability to build, owing to unlawful subdivision or insufficient surface area, constitutes a material defect justifying both annulment of the contract and damages.
2. What can I do to recover my money?
Two avenues open up in parallel. On the civil side, a lawsuit for damages is filed on grounds of tort and fraud, seeking the return of the price, engineers’ and notary’s fees, registration costs, and pecuniary compensation for moral damage. Alternatively or cumulatively, annulment of the contract may be sought on the basis of fraudulent misrepresentation. On the criminal side, a criminal complaint for fraud is lodged with the Prosecutor’s Office of the Court of First Instance, which strengthens the evidentiary basis of the civil claim. In addition, an interim measure of conservatory attachment may be sought against the sellers’ assets, in order to secure future enforcement of the claim before any assets are transferred.
3. Within what time must I take legal action?
The deadlines are critical and differ for each claim. The tort claim is time-barred after five years from the moment the injured party became aware of the damage and of the person liable. Annulment of a contract on grounds of fraud is brought within two years of its discovery. A criminal complaint for fraud is lodged within three months from knowledge of the act and of the perpetrator, unless a felony is involved, in which case prosecution is initiated ex officio. In practice, time usually starts to run when the Planning Authority refuses the building permit. Delay without action can definitively bar judicial protection.
4. What documents and evidence do I need?
You should collect the sale and purchase contract containing the seller’s statements as to compliance, the title deeds of the property, the topographical diagram, the refusal decision of the Planning Authority with its reasoning, the approved town-planning scheme, and any decisions of the Prefect or Regional Governor defining the minimum plot size requirement. You will also need receipts of payment of the price, engineers’ and notary’s fees, correspondence with the sellers, advertisements and any written or electronic communication evidencing the assurances given. Witnesses present during the negotiations and an engineer’s expert report on the actual condition of the property complete the file.
5. What chances of success do I have in such a case?
Where it is established that the property resulted from an unlawful subdivision or falls short of the required surface area, and at the same time there is an express statement by the seller in the contract regarding compliance, the prospects of success are significant. The case law of Areios Pagos, with the leading example of judgment 89/2023, consistently supports defrauded buyers. The Planning Authority’s refusal decision is decisive, functioning as objective evidence of non-buildability. As a rule, the price, ancillary expenses and pecuniary compensation for moral damage are awarded. The final outcome depends on the completeness of the file and the evidence of the sellers’ intent.
6. What is the role of the lawyer in this case?
The Law Firm ZIAMPARAS D. & ASSOCIATES first undertakes the examination of the title deeds, the topographical diagram and the planning regime, in order to confirm the sellers’ liability. The firm designs the procedural strategy, combining a civil lawsuit, a criminal complaint for fraud and interim measures of conservatory attachment to secure the claim. It drafts and files the pleadings, represents the buyer before the Multi-Member Court of First Instance and in the criminal proceedings, negotiates an out-of-court settlement where advantageous, and monitors enforcement of the judgment until the awarded amount is actually recovered. The objective is the full restoration of the client’s financial loss.