How to avoid lawsuits challenging real estate transactions due to seller's incapacity revealed

According to experts from the Federal Notary Chamber, one of the most common reasons for challenging real estate transactions in the Russian Federation is the incapacity or limited capacity of one of the parties. Lawyer Arkady Li told MK how to reduce the risks of litigation for this reason in transactions (or contracts) involving real estate.

From a legal point of view, legal capacity is the ability of a citizen to acquire and exercise civil rights, create civil obligations for himself and fulfill them by his actions. Civil legal capacity arises in full upon reaching the age of majority, that is, upon reaching the age of eighteen.

An exception is situations when a minor citizen acquired full legal capacity before reaching the age of 18 as a result of marriage or emancipation. In this case, the minor has the right to acquire real estate independently.

In other cases, when a person has not reached the age of majority, real estate transactions are concluded with the consent of parents, adoptive parents or guardians (trustees).

The question of whether a person was fully capable at the time of the transaction is of great legal significance, since the lack of capacity may result in the contract being declared invalid in court.

Any interested party has the right to file such a claim. In practice, these are most often third parties, i.e. persons who are not parties to the contract but have a certain material and legal interest in challenging the concluded real estate transaction. As an example, we can cite cases where one of the heirs of the deceased files a claim to invalidate the contract concluded by the deceased testator. The interest of such an heir in winning the case is understandable: after all, in this case, the sold property remains part of the inheritance and the plaintiff becomes its owner (co-owner).

Determining the legal capacity of a citizen at the time of a transaction is a difficult task even for a lawyer.

The most common and accessible way to check it is to get an extract from the USRN register. If a person is limited in legal capacity, then it will contain a corresponding mark.

However, a person may not have legal capacity, and there will be no mark in the register, since the state registration authority may not have information about this.

Another method used in real estate transactions is to obtain a certificate from the real estate seller from a mental health clinic, as well as a drug addiction clinic, stating that he is not registered.

This method of securing a transaction also cannot be considered sufficiently reliable, since not all citizens suffering from the relevant diseases are officially registered.

Sometimes citizens are advised to give the transaction a notarial form. They justify this by saying that the notarial form is more reliable than a simple written form of the transaction. This is partly true. At the same time, the notary in most cases cannot determine whether the person who came to the transaction is fully capable. This person can normally answer the questions asked of him and not cause any doubts in the notary.

However, in some cases even notarial transactions can be challenged in court. Why do we say "can"? Because the invalidity of transactions on the grounds that the person who, for example, sold an apartment, was not aware of his actions due to incapacity or for some other reason, is subject to judicial proof.

There are often situations when a person is capable but is not aware of his actions due to some physical disability. For example, a person has developed the consequences of a severe heart disease.

These cases are very similar to what we discussed above when we touched upon the issue of a citizen's incapacity. When considering these disputes in court, the approaches to their consideration are very similar.

The law states that a transaction concluded by a citizen, although capable, but who at the time of its conclusion was in such a state that he was not able to understand the meaning of his actions or control them, may be declared invalid by the court at the suit of this citizen or other persons whose rights or legally protected interests were violated as a result of its conclusion.

Real estate sales contracts often include conditions that "the parties guarantee that they understand the significance of their actions, are not under guardianship, are not deprived of or limited in legal capacity," etc. But to what extent can such conditions protect a person from possible litigation regarding challenging the contract in court? Obviously, such conditions also cannot guarantee the security of the transaction.

I would like to advise readers of MK to contact lawyers in cases of concluding transactions on alienation of real estate, challenging transactions by heirs, etc. Realtors and other intermediaries in the real estate market, unlike a lawyer, do not have knowledge in this area of ​​litigation and are not directly interested in making legal transactions, since they do not bear adverse legal consequences in the event of recognition of the transaction as invalid and do not have judicial experience. The activities of realtors are not licensed. Lawyers act in accordance with the requirements of the law on advocacy and codes of attorney ethics, and bear responsibility as provided by law.

The question of whether a citizen is aware of his actions, whether he is capable, is quite complex, and the risks associated with such situations are significant. It is necessary to comprehensively assess the circumstances associated with the personality of the person who has concluded such a transaction.

During the trial on the issue of whether a citizen is incapacitated or whether he was aware of his actions at the time of the transaction, forensic psychiatric examinations are conducted. Such examinations are carried out, including in relation to persons who have died by the time of the trial. Examinations are carried out on the basis of a court ruling most often in psychiatric hospitals by psychiatrists with extensive practical experience.