Careful due diligence cannot guarantee that a real estate transaction will never be challenged, but it can reduce avoidable risks. The legal history of the property, the seller’s authority, the register information and the payment structure should be checked before signing.
Core checks
- obtain current information from the Unified State Register of Real Estate;
- verify the seller’s identity, authority and the basis of title;
- review restrictions, encumbrances, disputes and relevant register notices;
- check the chain of documents and the property’s actual status;
- identify consents, corporate approvals or representation documents that may be needed;
- use a contract and payment trail that accurately reflect the agreed transaction.
Misrepresentation and invalidity
A transaction entered into under fraud can be challenged in court under Article 179 of the Russian Civil Code. Deliberate concealment of information that a party was required to disclose can also constitute fraud. The applicable remedy and evidence depend on the particular facts; an allegation alone does not invalidate a transaction.
Register information and documents
Register information can be provided as an extract or as a copy of documents held in the registration file where the law permits. Check the information shortly before signing and again before filing if the transaction timetable makes that sensible. Where several real-estate objects are involved, make sure the contract identifies each cadastral number correctly.
Payment and handover
Agree a documented payment mechanism and record the handover of keys, documents and possession. Avoid arrangements that leave the actual payment or price unsupported by reliable evidence. A notary, bank or other professional participant may add useful safeguards in appropriate cases, but their involvement does not eliminate the need for due diligence.
This material is general information and is not a substitute for advice on a particular transaction.