Withdrawing from promise of sale

A Reader wishes to know under what circumstances may he withdraw from a promise of sale and purchase agreement (convenium) where a deposit has been made on account of the selling price.

In a promise of sale and purchase agreement it is best to state clearly and precisely whether the parties to the agreement intend to pay a deposit on account of the price or by way of earnest (kapparra). In the latter case, both parties may opt out of the agreement. In fact, in such cases the parties are not actually binding themselves to perform the final deed of sale and purchase.

According to law, where in any promise to sell or promise to buy, earnest has been given, both parties shall be at liberty to withdraw from the contract, the party giving the earnest forfeiting it, and the party receiving the earnest returning double its amount.

When the deposit is one which is paid on account of the price, there is an obligation on both parties to carry out the final deed of sale and purchase. If the sale can no longer be carried out, the parties in default are obliged to make good the damages to one another, depending upon which party to the agreement is at fault.

In conclusion, when the deposit is paid and received by way of kapparra on a promise of sale and purchase agreement, the parties to the agreement, whether with or without a good and just cause, are free to withdraw from the agreement by forfeiting or paying double the amount of the kapparra to the other party.

In the reader's case, since the deposit was made on account of the price, he is bound to proceed with the final deed of sale unless there are other justifiable grounds at law which warrant the rescission of the contract.

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