One of the most controversial issues in purchasing an immovable property today is the situation where the sale does not proceed. Does the seller or purchaser have the right to the deposit? The answer to this question is not that easy or as simple as many sellers, buyers and estate agents wish to believe.
In our Law of Contract, it is accepted that one of the main principles is that the failure of an agreement places an obligation on both parties, in this situation the seller and purchaser, to restore each other to the position they were in immediately prior to the conclusion of the agreement. Based on this principle, many purchasers believe that if the sale does not proceed, due to their inability to obtain finance, then the deposit will automatically be returned to them. Unfortunately for the purchaser, it is not as simple as that.
The question of who does the deposit belong to is fraught with complexity and considerately depends on the wording of each offer to purchase.