(Czech Supreme Court Judgment of 9 March 2016, No. 31 Cdo 353/2016)

Until recently, there has been fundamental disagreement between the Czech Supreme Court and Czech Constitutional Court as to whether title to real estate could be acquired from a non-owner under the legislation valid until 31 December 2013. In the view of the Constitutional Court, it was indeed possible, if acquisition from a non-owner occurred in good faith that the transferor was the owner of the transferred real estate. The Supreme Court was of the opposite view. Such a transaction typically involves a situation comprising a “chain” of real estate (e.g. an apartment) sales transactions in which the real estate repeatedly changes hands (and the new owner is always entered in the real estate cadaster), and the transfer between the first seller and buyer in this “chain” is later found to be invalid. The question, then, is whether the last acquirer of the real estate (who acquired it in good faith that the buyer was its legal owner entered in the real estate cadaster) is its true owner.

This “dispute” seems definitively to have been resolved with the above mentioned Supreme Court judgment; indeed, the judgment’s findings were based on recent adjudication of the matter by the “Grand Panel” of the Supreme Court. In the cited judgment, the Supreme Court concluded that, having regard to the fact that virtually every panel of the Constitutional Court had ruled that, in accordance with the legislation valid until 31 December 2013, the acquisition of real estate from a non-owner was possible where the acquirer acted in good faith, it could do nothing but be guided by the constant jurisprudence of the Constitutional Court and accept the acquisition of real estate from a non-owner under these conditions.