The Civil Court, First Hall has recently confirmed that a promise of sale agreement must be honoured, even where the vendor owns an inferior share to that initially promised to the purchaser in the promise of sale agreement, provided the latter is still interested in purchasing and acquiring such inferior share.
The case in question involved the following merits: Upon the expiration of a promise of sale agreement between vendor and purchaser for a block of apartments, purchaser instituted a case in the Civil Court, First Hall, asking the court to order the vendor to appear on the final deed of sale under the terms and conditions agreed to in the promise of sale agreement. However, it became apparent between the conclusion of the promise of sale agreement and the institution of the court case, that the vendor was not in a position to sell and transfer the entire portion of the block of apartments in question. It transpired that the vendor only owned 7/16ths of the property, and not the whole of the property as initially promised to the purchaser.
Through the course of the proceedings, it emerged that the purchaser was still interested in purchasing and acquiring the property in its reduced portion, and requested the court to order the vendor to appear on the final deed of sale for such portion against a pro rata price. The vendor conversely did not oppose the publication of the final deed of sale under such terms. The emergent dilemma was that notwithstanding the parties’ desires to move forward with the sale, the Court could not effectively order the vendor to appear on the final deed of sale on the basis of the terms and conditions agreed to in the promise of sale agreement, since these had apparently changed.
The Court ultimately held that the final deed of sale should nonetheless proceed. The Court determined the purchase price of the vendor’s portion of the block of apartments proportionately on the basis of the original purchase price agreed, with a further reduction to cover costs and the inconvenience imposed on the purchaser in attempting to acquire the entire block. The Court reasoned that on the basis of ‘il piu comprende il meno’, the choice should be of the purchaser, and in this case, the purchaser was prepared to acquire less than that initially promised for a reduced price. The Court held that where this was not considered to be the purchaser’s choice, vendors would abuse of their position by taking advantage of their own shortcomings and forcing purchasers to choose between either not purchasing, or purchasing for the initial price agreed, notwithstanding the deficiencies in nature or quality of the object being sold. The Court held that in conformity with the bona fides principles and Articles 1390, 1400, 1401 and 1427 of the Civil Code, Chapter 16 of the Laws of Malta, the Court was entitled to order the publication of the final deed of sale for the reduced portion of the property and proportionately reduce the price of the acquisition.