Early delivery of keys is a common practice, especially when the signature of the purchase and sale operation is delayed and buyers need access to the home. However, this practice can have serious consequences if an unforeseen event arises, as happened to a couple in France who sold their home for 238,000 euros and who, after allowing the buyers to move in before signing the final deed, ended up assuming the full cost of reconstruction after a fire.
On the day scheduled for signing, the buyers refused to close the transaction when they detected a problem in the heating system. According to reports from the French media Figaro Real Estate, To avoid losing the sale, the sellers agreed to make the repairs and postponed the signing. They also signed a private agreement that allowed the buyers to occupy the house freely until the final formalization of the operation.
What they did not imagine when they signed this agreement is that ten days later, the house would be practically destroyed by a fire. The experts estimated the damage at 250,000 euros, an amount even higher than the agreed price. Faced with this situation, the buyers decided to withdraw from the operation, invoking a clause that allowed them to cancel the sale if the property was destroyed before the signing of the public deed.
The buyers were not responsible for the fire despite occupying the home
The sellers sued the buyers and their insurer, considering that, as they were occupying the home, they should be liable for the fire. They relied on the legal presumption that, in the event of a fire, responsibility falls on the tenant. Furthermore, they argued that the transfer of ownership had in fact occurred when the keys were handed over.
However, the Court of Cassation (the equivalent of the Spanish Supreme Court) rejected that approach. As lawyer Florence Iung explained in the media, “in the absence of a lease contract, the presumption of tenant liability cannot be applied.” The high court was clear in this regard by stating that an occupant who lives rent-free is not a tenant.
Furthermore, the judges determined that the origin of the fire was related to a defect in the property derived from works carried out by the sellers themselves before the preliminary contract. Therefore, its liability had to be analyzed in accordance with general civil law.
The consequence was especially hard for the owners. Not only did they not obtain any compensation, since they had canceled their insurance policy before the fire, but they were sentenced to pay 38,145 euros to the buyers for the loss of their furniture. If they want to rebuild the home, they will have to assume the necessary 250,000 euros, in addition to continuing to pay the 102,723 euros pending on their mortgage. In total, the damage could reach 288,145 euros.
“Until the official deed is signed, the situation remains legally precarious,” warns the lawyer, who advises against handing over the keys early and recommends keeping the insurance in force until the final transfer.