How to terminate a purchase and sale agreement for an apartment.

Buying your own apartment can be a cherished dream for everyone; however, this entire process from the perspective of legal nuances can be complicated. For example, sometimes you need to know how to terminate a purchase and sale agreement for an apartment and how to cancel the transaction. 

It's generally better for both sellers and buyers to understand how to annul a purchase and sale agreement. After all, the algorithm for how to terminate a purchase and sale agreement should be prompt. After all, it’s about money. 

How to terminate a purchase and sale agreement for a house?

First of all, it's important to understand how to properly draft a transaction and how to safely terminate it. Especially the preliminary agreement. After all, you can exit such a transaction with minimal losses.

You should start from the fact that in Ukraine there is a basic agreement based on which the transfer of property rights takes place. This is a purchase and sale agreement. Less frequent is a donation agreement, but that’s an entirely different transaction. However, in some situations, the parties may wish to terminate this agreement. This applies to preliminary agreements and permanent transactions. 

In 2024, the legislation of Ukraine continues to provide opportunities for terminating such agreements, but this requires compliance with a number of legal procedures. This is an important nuance since the war continues in Ukraine, and this affects all real estate markets. 

To understand how to act in such a situation, you need to know what grounds for this exist. The termination of the agreement is only possible in the presence of certain grounds regulated by the legislation of Ukraine, in particular, the Civil Code of Ukraine.

What is at stake: 

1. Previously stipulated conditions are not met (the agreements were violated). For example, the buyer did not pay the agreed amount or the seller did not deliver the apartment within the specified Time.
2. There was deception. For example, the seller concealed the existence of encumbrances on the apartment (e.g., arrest) or the buyer provided false documents.
3. If the transaction is illegal. This refers to cases where the agreement was concluded in violation of legal requirements or the seller did not have the right to sell the property.
4. If unforeseen circumstances arose. This means that a significant deterioration in the condition of the property was identified before the transfer. This also applies to recognizing one of the parties as incapacitated.

There is also an option that the parties mutually agreed to annul the transaction. This means that the buyer and seller have come to an agreement on termination.

If the parties reached an agreement

The simplest way to terminate the agreement is to reach mutual consent. After all, then the parties have no claims against each other. Here’s how it happens: 

1. First, a written agreement needs to be drafted. Draft a written agreement to terminate the agreement, where both parties confirm their consent. Indicate the date, grounds for termination, and conditions for the return of money (if applicable).
2. Next, this agreement needs to be notarized. Since the purchase and sale agreement is notarized by a notary, the agreement for its termination must also be certified.
3. It is also better to register all changes in agreements. Contact the property rights registry to cancel the changes made in connection with the agreement.

This is the simplest and clearest option for how to terminate the transaction. 

When to go to court? 

If one of the parties does not agree to terminate the agreement, court proceedings will be required. This is a more complex and lengthy option. 

Here’s how it happens: 

1. First, you need to gather evidence. Prepare documents confirming the grounds for termination (contract, payment documents, evidence of fraud, or violation of conditions).
2. After that, you can file a lawsuit. Apply to the court at the location of the property. In general, you need to specify all reasons why the termination of the agreement is necessary. 
3. The next stage will be a court hearing. At the hearing, provide all evidence. The court will assess the legality of the claims and make a decision.

In the case of a positive decision, the court will issue a ruling to terminate the agreement. Contact the property rights registry to make changes.

What happens after the agreement is terminated? 

It is important to understand that after the termination of the agreement, each party will have its own consequences. This refers to financial and legal consequences. For the seller, this means returning the funds received back to the buyer and restoring the ownership rights to the apartment.

For the buyer, other consequences occur. This involves the return of the paid amount and possible additional costs (for example, court costs). In general, for each party, this may result in the annulment of all rights and obligations related to the agreement. 

Therefore, before terminating the agreement, it is important to weigh all the pros and cons of this process. It is also important to understand what the consequences of the transaction annulment will be in terms of the purchase or sale of real estate.