Convalidation of Real Estate Contracts Concluded Without Authentic Form in Romania

Abstract

Generally, in Romania, a real estate contract (i.e. a contract for the sale and purchase of real estate between two parties) can only take the form of an ad validitatem contract, which means that it must be concluded by a public notary, an authentic form required by law. Without an authentic form, the contract is absolutely void; however, according to the Romanian Civil Code, ‘a contract that is absolutely void will still produce the effects of the legal act for which the conditions of substance and form laid down by law are fulfilled’. Therefore, it can be considered in terms of the convalidation of a real estate contract without an authentic form as a precontract. After Communism, because of the poor economic situation in the country and the lack of land registers, people only concluded real estate sales contracts between themselves, which were called “pocket contracts.” This meant that the seller and buyer drafted the text of the contract themselves, writing it by hand. The contract was signed by two witnesses, usually local priests, teachers, or the neighbours of the parties. Obtaining land registers was not only time-consuming but also costly, as the probate procedure is handled by a public notary. This topic also raises several property rights issues.