As a result of a cassation appeal, the Supreme Court has ruled on the case of significant delay in the execution of the public deed of sale as part of a sale contract, where the delay in the date of delivery had been stipulated as a cause for termination of the contract.
In the ruling of the Provincial Court, confirming that of the Court, the buyer argued failure to meet the delivery date set in the contract by the developer which was set as an express cause for contractual termination. Notwithstanding the foregoing, the Provincial Court ordered the buyer to fulfil the contract, to execute the public deed thereof and to pay the amounts outstanding on the price, having considered that the delay had not been significant. Consequently, the purchaser filed a cassation appeal against the ruling of the Provincial Court, and the Supreme Court ruled as follows.
To clarify, the sale contract established an express condition for termination the delay in the completion of the works if said delay was not justified by a number of proven reasons. The date set in the contract for completion of the works was June 2010; however, the buyer was requested by the developer to execute the public deed 10 months later.
Therefore, given the absence of any of the valid causes justifying a delay in the completion of the works and, therefore, non-fulfilment by the developer of its obligation to deliver the property under the terms agreed in the contract, the Supreme Court considered that this contractual breach constituted an express cause for termination and decreed the termination of the sale contract.
In this context, the Supreme Court explained the nature of the express and tacit termination conditions, distinguishing between each type and places particular emphasis on the freedom of the parties to agree on certain breaches as causes for termination, aside from the fact that they may be objectively deemed to be serious, with sufficient weight for termination or neither of these.
In conclusion, the Court stated that in this case it is not necessary to consider whether or not the delay was significant, as the parties had contractually agreed the effect of this breach to be the termination of the contract.