Quality guarantee for real estate

In connection with the purchase of real estate, we sometimes talk about the so-called quality guarantee. What is meant by this guarantee and how does it differ from liability for defects? What changes have been brought about by the amendment to the legal regulation of the guarantee effective from 6 January 2023? You will find out in the following lines.

Author of the article: ARROWS (JUDr. Lukáš Slanina, office@arws.cz, +420 245 007 740)

Amendment to the Civil Code

The reason for the amendment of the legal regulation of the guarantee was mainly the inconsistency and duplication of its regulation. The legislator therefore proceeded to abolish the general legal regulation of the guarantee and at the same time clarified the specific regulation of the guarantee in the case of a purchase contract. It now applies (mutatis mutandis) also to contractual types other than the contract of sale. In addition to the above, we would like to remind you that the concept of the so-called statutory guarantee has been abolished at the same time (see the article "Statutory guarantee for real estate ends?").

What is a guarantee and what is its meaning in real estate?

A guarantee is a declaration by the guarantor (in particular the seller, but also a third party - for example, a real estate agent) that it undertakes to provide the buyer with a certain performance if the property does not have certain characteristics. A warranty is a voluntary undertaking by its provider and should be distinguished from statutory liability for defects.

1. In the case of (statutory) liability for defects, the defect must already exist at the time of the so-called transfer of risk to the property. It is advisable to expressly stipulate this moment in the contract. The buyer must therefore prove that the item was already defective at this point in time (e.g. as a result of the poor quality material used).
2. In the case of a (voluntary) warranty, it is sufficient that the defect occurs at any time during the warranty period. However, the buyer has no right under the warranty if the defect is caused by an external event (for example, adverse weather conditions) after the risk of damage to the item has passed to the buyer.

The length of the warranty period depends on the declaration of the warranty provider. The defect covered by the guarantee must be pointed out within the period determined by the length of the guarantee period. The warranty mayinclude, for example, the right to withdraw from the contract, the right to have the item repaired or to provide another service to remedy the unsatisfactory condition of the object of purchase (for example, a discount on the purchase price). The warranty can only be assumed in excess of the buyer's statutory rights under the defective performance in order to avoid misleading customers in this way.

However, due to the voluntary nature of the guarantee, you are more likely to encounter this guarantee in development projects than in ordinary real estate transactions. If you are unsure about anything, please do not hesitate to contact us. We will be happy to help you.