Buying and selling real estate: what to do under Georgian law

What to do

1. Transfer of ownership: ownership of real estate passes upon a written transaction AND registration of the buyer's right in the Public Registry (Civil Code of Georgia, Art. 183).
2. Checks before the transaction: the registry extract shows rights, public-law restrictions, tax liens and mortgages, and the debtors' register (Law of Georgia on Public Registry, Art. 10) — obtain a fresh extract on the day of the transaction; check the representative's powers; a parent may alienate a child's property only with court consent (Civil Code of Georgia, Art. 183).
3. Protection of the buyer: for a buyer, a seller registered in the registry is deemed the owner, unless the buyer knew otherwise (Civil Code of Georgia, Art. 185); this protection does not apply if a complaint has been filed against the entry or the buyer knew it was inaccurate (Civil Code of Georgia, Art. 312); the consent of an unregistered co-owner cannot be demanded (Civil Code of Georgia, Art. 312); a transaction by one spouse involving joint property cannot be declared void merely because the other spouse did not know of it or did not consent; the other spouse may claim his or her share of what was received (Civil Code of Georgia, Art. 1160).
4. Deposit and preliminary agreement: a preliminary agreement must be in the same form as the main agreement (in writing) (Civil Code of Georgia, Art. 327); the deposit (ბე) remains with the recipient if the party who gave it is at fault for the breach (Civil Code of Georgia, Art. 423); if the recipient is at fault, he or she returns the deposit in double amount and compensates the losses (Civil Code of Georgia, Art. 423). Against a double sale: a preliminary registration of a right in the registry blocks registration of other rights under transactions (Law of Georgia on Public Registry, Art. 12); of mutually exclusive rights, the one applied for first is registered (Law of Georgia on Public Registry, Art. 13).
5. Disputes: a registered right that does not exist is a legal defect of the property sold (Civil Code of Georgia, Art. 489); the limitation period for contractual claims concerning real estate is 6 years (Civil Code of Georgia, Art. 129); a decision of the registering authority may be appealed within 30 calendar days from official notification (Law of Georgia on Public Registry, Art. 29); a decision to register a right is appealed in court (Law of Georgia on Public Registry, Art. 29); securing a claim — a prohibition on the defendant performing actions, such as alienating the property (Civil Procedure Code of Georgia, Art. 198).
6. Where to apply: National Agency of Public Registry (საჯარო რეესტრის ეროვნული სააგენტო); notary; court.
7. Evidence: extract as of the transaction date, preliminary and main agreements, a receipt expressly stating 'deposit' (ბე), payment documents, power of attorney, correspondence.
8. Pitfalls: transferring the full amount before registration without a preliminary registration or other protection; an oral agreement on a deposit, or a receipt stating 'advance' instead of 'deposit'; buying while a complaint against a registry entry has been filed, which the buyer knew about; buying a new-build without checking the developer's rights to the land and any encumbrances.

Be sure to check

• moment of transfer of ownership (written transaction plus registration)
• checks before the transaction (extract — mortgage, arrest, tax lien, debtors' register; child; representative)
• protection of the good-faith purchaser and its limits
• fate of the deposit and ways to protect against a double sale
• time limits and ways to challenge (limitation, appeals against registry decisions)