.
News | Sunday, 31 May 2009
Bookmark and Share

German ends up €34,000 short in social housing ‘sale’

Promise-of-sale agreement contained illegal clause conditioning buyer ‘not to register agreement with tax department’


A German citizen who came to Malta to settle on the island and buy herself a property ended up getting more than she bargained for, after finding herself in court chasing the deposit she paid on a house that did not belong to the vendor, but to the Housing Authority.
Maria Alexejvna El, of Russian origin, instituted civil proceedings against Joseph Mary Balzan, of Swieqi, to reclaim the €34,800 deposit she paid on a promise-of-sale agreement.
El entered into agreement with Balzan, an acquaintance, in March 2008 to sell her an apartment and garage in the block of government apartments on Darmenia street, in Pembroke.
In the promise-of-sale agreement, seen by MaltaToday, the property was being sold by Balzan “under the conditions of the Housing Authority as per HA number 125/2004” for €116,000.
In fact, Balzan was not the owner of the property but was in the process of acquiring the unit, having signed a preliminary agreement with the Housing Authority.
While the transfer of this konvenju from the Housing Authority could have only taken place under authorisation of the authority itself, Balzan reportedly “presented the authorisation from the Housing Authority which potentially covered the apartment, but not the garage”.
El subsequently paid a deposit of €11,600 and a futher €23,300 in July to the vendor’s lawyer, Dr Kris Balzan. She claims the vendor talked her into paying him more money before their six-month agreement was finalised.
However, the promise-of-sale agreement drawn up and signed by Balzan’s notary Reuben Casingena, carried the condition that “parties agree that this agreement is not to be registered with Tax Department”.
Legal experts told MaltaToday it is illegal to insert such a clause in the agreement, since all konvenji must be registered for capital gains and income tax purposes.
There is also no indication in the agreement that El, as a foreign citizen, had to abide by the conditions of the Acquisition of Immovable Property regulations for foreign property buyers.
Seeing that Balzan could not actually transfer the property and that her money had not been registered with the authorities, she demanded her money back. Seeing she had no chance of reaching an amicable termination to the botched agreement, she turned to the courts.
She is asking the courts to order Balzan to return her money and is calling Casingena to the witness stand to answer for the promise-of-sale agreement, as well as lawyer Kris Balzan to confirm the payment of the money into his account.
El also filed a criminal complaint to the Commissioner of Police as far back as 17 November 2008, but she says there has been no follow-up on the complaint by the police yet.


Any comments?
If you wish your comments to be published in our Letters pages please click button below.
Please write a contact number and a postal address where you may be contacted.

Search:



MALTATODAY
BUSINESSTODAY


Download MaltaToday Sunday issue front page in pdf file format


Reporter
All the interviews from Reporter on MaltaToday's YouTube channel.


EDITORIAL


Free health? What free health?


INTERVIEW




Copyright © MediaToday Co. Ltd, Vjal ir-Rihan, San Gwann SGN 9016, Malta, Europe
Managing editor Saviour Balzan | Tel. ++356 21382741 | Fax: ++356 21385075 | Email