Real Estate and Construction
Construction and real estate matters often concern one of the largest assets of an individual or company, whether this involves buying a home, leasing premises, construction or a development project. A deficiency in a contract, hidden defect, issue with a permit for use, construction defect or spatial planning dispute can affect both the value of a transaction and the use of the property. Law Firm Namm advises and represents individuals and businesses throughout Estonia in matters related to construction and real estate.
In real estate transactions, it is important to check the legal and technical condition of the property before entering into a contract. Ownership, mortgages, servitudes, restrictions on use, data in the Register of Construction Works (Estonian Building Register), building permits and permits for use, and the contract terms all require attention. For the buyer, prior checks reduce the risk of later claims and costs. For the seller, a clear contract helps limit the risk of unfounded disputes.
Disputes often arise after a transaction, when hidden defects become apparent, the contract is interpreted differently or it emerges that the building does not match the documentation. In lease relationships, common disputes concern rent, the security deposit, termination of the contract, the condition of the premises and use of commercial premises. In construction, disputes often concern the quality of the works, deadlines, remuneration, warranties and rectification of defects.
In development and construction projects, spatial plans, building permits, permits for use, neighbours’ rights, resolutions of apartment associations and the organisation of documentation also arise. A dispute may arise from a problem with the contract, the quality of the works, the register data of the construction works or the parties’ different understanding of their obligations. A timely legal assessment helps choose an appropriate claim, avoid the expiry of a time limit and reduce the costs of the dispute. We work in Estonian, Russian and English.
How we help in construction and real estate matters
- Drafting and reviewing sale and purchase contracts for real estate
- Legal advice on real estate transactions
- Checking the Land Register, Register of Construction Works, servitudes and encumbrances
- Disputes concerning the sale and purchase of real estate
- Claims related to hidden defects
- Matters related to permits for use, building permits and building notices
- Residential and commercial lease disputes
- Drafting and reviewing lease contracts
- Construction contracts and disputes concerning construction contracts
- Construction defects and construction warranty disputes
- Advice related to detailed spatial plans and comprehensive plans
- Common ownership and neighbour disputes
- Disputes involving apartment associations and challenges to resolutions of apartment associations
- Servitudes, land use and rights of pre-emption
- Legal review of development projects, permits for use and documentation
Frequently Asked Questions
I bought an apartment or house and discovered a defect. What can I do?
The defect should be documented immediately. This usually means photographs, videos, correspondence, an expert assessment and documents showing costs. Before carrying out significant repair works, it is advisable to record the nature and extent of the defect and give the seller an opportunity to state their position. Depending on the circumstances, you may claim a reduction of the price, reimbursement of the costs of rectifying the defect, compensation for damage or withdrawal from the contract in the case of a material defect.
What is a hidden defect?
A hidden defect is a defect that the buyer could not have noticed during a reasonable inspection at the time of the transaction, for example moisture damage inside a wall or a hidden structural defect. The seller’s liability depends, among other things, on whether the seller knew about the defect and whether the seller concealed it. Each case requires a separate assessment, but in the event of a hidden defect the buyer often has the right to bring claims.
How quickly must the seller be notified of a hidden defect?
The seller must be notified within a reasonable time after the defect is discovered. Late notice can make it more difficult to bring a claim, as the seller must have an opportunity to inspect the defect and present their position. Claims are also affected by limitation periods, the contract terms and whether the seller knew about or concealed the defect.
What should be checked before buying or selling real estate?
It is advisable to check Land Register data, ownership, mortgages, servitudes, restrictions on use, Register of Construction Works data, building permits and permits for use, spatial plans and utility or apartment association documents. For the buyer, it is important to know what is actually being acquired. For the seller, it is important that the contract describes the condition of the property and reduces the risk of later unfounded claims.
Can real estate be bought if there is no permit for use?
The absence of a permit for use does not always mean that the transaction is impossible, but it is an important risk. A missing permit for use may affect obtaining a loan, insurance, use of the property, later sale and possible liability for defects. Before the transaction, it is necessary to clarify why the permit for use is missing, whether the construction work complies with the requirements and who is responsible for organising the documents.
A dispute has arisen with the landlord or tenant. What are my rights?
Lease disputes often concern payment of rent, return of the security deposit, termination of the contract, ancillary costs, the condition of the premises and compensation for damage. In residential lease relationships, the tenant’s protection is stronger than in commercial lease relationships. The contract, handover report, correspondence, payment documents and evidence of the condition of the premises are decisive when resolving the dispute.
The builder did defective work or left the work unfinished. What can I claim?
In the event of a breach of a construction contract, you may claim rectification of defects, reduction of the price, compensation for damage, default interest or, in certain cases, withdrawal from the contract. It is important to record the status of the works, defects, deadlines and correspondence between the contracting parties. In construction warranty disputes, it must be assessed separately what work was agreed, whether the defect is covered by the warranty and whether the complaint was submitted on time.
Can a resolution of an apartment association be challenged?
A resolution of an apartment association can be challenged in certain cases if it violates the law, the articles of association or the rights of an apartment owner. Disputes may concern the repair fund, management costs, taking out a loan, common areas, parking or construction works. As a general rule, the time limit for submitting a claim for annulment of a resolution is 60 days from the adoption of the resolution.
My neighbour is infringing my rights. Can anything be done?
Neighbour disputes may concern noise, access, boundaries, structures, obstruction of a view, water drainage, trees and shrubs, servitudes or use of the immovable. First, it is necessary to identify which right or obligation has been breached and what evidence confirms this. It may be possible to claim cessation of the breach, compensation for damage or specification of the rules for using the immovable.
What should I do if I disagree with a spatial plan or building permit?
The time limits for challenging a spatial plan, building permit or permit for use are short. The general time limit for an action for annulment of an administrative act is 30 days from notification of the administrative act, unless the law provides otherwise. It is important to participate in the proceedings as early as possible, submit objections in writing and show how the decision affects your rights.
Does a dispute always have to be taken to court?
No. Many real estate, lease and construction disputes are resolved through negotiations, a letter of claim or settlement. Recourse to court is necessary when the other party does not acknowledge the claim, the claim must be preserved because of time limits or an enforcement instrument is needed to resolve the dispute. Before litigation, it is worth assessing the evidence, costs, time limits and possible outcome.