The valid notification of the sale, including its price and conditions, to the tenant or lessee constitutes an essential requirement in the sale of leased properties. Failure to comply or defective execution of this notification suspends the land registry registration of the transfer and may even render it void through the exercise of the tenant’s right of first refusal.
The preferential acquisition right of tenants and lessees is governed by Article 25 of Law 29/1994 of 24th November on Urban Leases.
Notwithstanding the literal wording of the law, there exists established case law from the Supreme Court advocating a non-literal interpretation of the provision, focusing instead on its functional purpose (STS 24.04.2007, 6.03.2000, 14.11.2002).
Thus, while notification via recorded delivery (“burofax”) or notarial means (which must verify the dispatch, receipt and content of the notification) remains most common, any form of notification shall be deemed valid when it can be proven that through it, the tenant became aware of the sale, price, and other conditions, and was able to exercise their rights. This approach stems from the ultimate purpose of notification – to safeguard the exercise of the preferential acquisition right.
What occurs when the tenant cannot be located at the property, refuses to accept notification, or when a third party (other than the tenant) is present at the property?
This matter reveals an interesting divergence in treatment by the Directorate General for Legal Security and Public Faith (DGSJyFP) between notifications sent via recorded delivery and those effected through notarial channels regarding registration of the sale.
When the failure of communication results exclusively from the recipient’s passivity, disinterest or negligence, “the recipient’s inaction cannot prejudice the other party’s rights” – a principle upheld by consistent constitutional jurisprudence (Constitutional Court Judgments 82/2000 of 27th March, 145/2000 of 29th May and cited cases). Communications produce full legal effect when their failure stems solely from the express or implied will of the recipient, or from their passivity, disinterest, negligence, error or incompetence.
Consequently, for registration purposes, it would suffice to demonstrate that all attempted delivery methods were exhausted, including the expiry of collection periods at the relevant postal office.
However, for notarial notifications, Articles 201, 202 and 203 of the Notarial Regulations apply. Where certified postal notification proves unsuccessful, the DGSJyFP requires – pursuant to the aforementioned articles – personal notarial notification to satisfy the legal requirement of valid notification to the lessee regarding potential exercise of the right of first refusal (DGSJyFP Resolutions 16.12.2013, 3.08.2017, 14.05.2017 and 29.08.2019).
In such cases, the Notary must attend the leased property in person to effect notification to the tenant/lessee, duly recording any refusal to accept the notification.
