Strong doubts regarding the content of the purchase agreement – purchase of property is lifted

The parties to a house deal disagree on whether payment for the house occurred.

Purchase document and liquidity bill confirming that the payment has been made are signed.

However, the seller’s son, who is a party to the case since the seller passed away, claims that this is not the case and therefore wants to cancel the purchase.

The Court of Appeal finds, despite the signed documents, that the content of the contract and the course of events are so unclear that no payment has been shown.

The buyer thus loses the target and the purchase is lifted.

Two colleagues have agreed that one of them should buy a house from the other.

Purchase deed and liquidity bill have been signed by both parties at a meeting at a bank, according to the documents, the seller should pay 170,000 kr. for the house.

However, when it comes to the question whether payment has been made or not, the parties do not agree.

According to the buyer, the agreement was that the purchase price would be SEK 150 000, which he paid in cash before and during the meeting at the bank, according to his own statement.

He further claims that there was an altercation at the bank that resulted in the seller and her son, C.W, forcing him to sign the documents stating that the purchase price is instead SEK 170,000.

After the meeting, he claims to have paid the remaining 20,000 DKK, again with cash.

The seller dies after the meeting and C.W. therefore takes over her role as the seller’s counterpart.

He claims that his mother and the buyer were colleagues and that she had therefore trusted the money to be paid by contract, despite no purchase price being paid when the documents were signed.

The purchase document states that the purchase may be cancelled if one of the parties commits breach of contract that is of no small importance to the counterparty.

C.W. is therefore bringing an action against the buyer in the District Court (TR), claiming that the purchase be lifted.

TR considers that it is up to the buyer to prove that the payment has been made.

The evidence he has presented is that the seller signed the purchase documents, which according to the court is sufficient to prove that payment was made.

The burden of proof is therefore shifted to C.W. who has to show that payment did not take place.

Among other things, he invokes bank statements from his mother’s bank showing that no deposits were made equivalent to the sums the seller claims to have paid for the house.

However, since the buyer states that he paid in cash, the Court’s judgment is that the statement of accounts does not exclude the payment being made without being deposited into the seller’s account.

Further, C.W. invokes testimony as evidence, however, the court does not believe that these strengthen his case any further.

What the court believes speaks to the buyer’s detriment is mainly that in some respects he found it difficult to account for exactly how the payments have been done.

However, this is not judged enough to refute the signed documents why TR declares that C.W. has no right to lift the purchase.

C.W. appeals to the Court of Appeal (HoVR), which brings the case to review.

HoVR shares TR’s judgment that the signed documents should normally be seen as sufficient evidence for payment to be made.

The burden of proof is thus shifted over to C.W.

The court notes that the buyer has provided vague information about how the payment has been made and that he cannot show any receipts of his payments to the seller.

Furthermore, it is noted that the buyer states that only 150 000 SEK of the contracted DKK 170 000 had been paid at the meeting at the bank.

This means that the parties agree that the signed documents are not correct as they state that the full purchase price was paid at the time of signing.

The Court also looks at a testimony given by the banker who assisted the parties at the conclusion of the contract.

Among other things, the banker in question states that he strongly advised the seller from signing the documents because no money had yet been paid.

He further highlights that he would be firmly advised against payment by cash if agreed as it could pose problems due to money laundering legislation.

The overall judgment of the Court is that the evidence in the case raises such strong doubts about the content of the purchase agreement and the liquidity settlement that it can no longer be considered that payment has been made.

Nor has the seller presented any other evidence in the case to further substantiate his claim.

In view of the presumed non-payment, HoVR makes the judgment that C.W. has the right to cancel the purchase and thus the buyer loses the case.