Everyone who has ever sought to rent an apartment knows how unpleasant this whole process can be: finding something close to the subway station or to other means of public transportation, multiple viewings, repairs or other necessary investments in the apartment, negotiating the rent etc.

I myself was involved in the process a few years ago and I know how cumbersome it can get.

At that time, I asked all potential lessors for an excerpt from the Land Registry with respect to their respective apartments and numerous times I was met with confused or disapproving looks, although I shouldn’t have been.

In effect, although an excerpt from the Land Registry cannot move the apartment closer to a subway station and cannot, in itself, reduce the amount of the rent, it is very useful in avoiding a whole host of legal risks.

In the following paragraphs, I will only give a few examples of such risks, with short accompanying explanations for each of them.

1. The excerpt from the Land Registry contains information with respect to your lessor’s title

At one of the viewings I took part in, the owner of the apartment showed me his title, i.e. a purchase agreement concluded in 1994. While a display of transparency from your future contractual partner is to be appreciated, in the case at hand, the purchase agreement concluded in 1994 told me nothing of the ownership rights over the apartment in the year 2015.

Of course, it is not mandatory for the lessor to also be the owner of the apartment, as the former could also be another person whose prerogatives enable it to grant you the use of the asset throughout the lease (Article 1786 (c) of the Civil Code), e.g. another lessee who was granted the ability to sublease (Article 1833 of the Civil Code) or, why not, a bailee who was granted the same ability (Article 2148 (2) of the Civil Code). We, however, will stay with the example of an owner, because this situation is the most common.

In the case at hand, in the relevant timeframe – 1994-2015, that apartment might have been subsequently sold once, twice or ten more times, to different people, meaning that the current owner of the property could have been someone entirely different than the person I was negotiating with.

Of course, even another person’s property can form the object of an obligation (Article 1230 of the Civil Code), but I don’t think anyone is particularly eager to have such discussions and to bear the risk of the non-owner-lessor failing to obtain the owning-third party’s agreement to the lease.

An excerpt from the Land Registry helps us avoid such situations. The main purpose of the Land Registry is to describe the immovable assets and the real property rights in relation thereto (Article 876 (1) of the Civil Code). The ownership right is the main such right (Article 551 (1) of the Civil Code). Therefore, in the case at hand, I would have expected for the excerpt from the Land Registry to nominate the person I was dealing with as the current owner of the apartment, based on the purchase agreement concluded in 1994.   

2. The excerpt from the Land Registry can indicate whether other lease agreements have been concluded with respect to the same asset

The social dynamic and the rhythm in which current economic life takes place amount to a large number of contracts that each of us concludes. Some lessors, however, take things to their extreme and rent the same asset to several people at the same time.

Assuredly, your use of the asset is no longer peaceful and useful (Article 1789, Article 1794 (1) of the Civil Code) if, when entering the apartment that you have rented, you are greeted by 4 other people, holding their respective bags in one hand and their own lease agreement in the other.

In such a scenario, a conflict (at least legally speaking) arises between the lessees, which is primarily solved in favour of the lessee who registered its right first in the Land Registry (Article 1782 (a) of the Civil Code).

If, however, one of the other 4 people carrying bags and contracts had already registered its right in the Land Registry before the conclusion of your lease agreement, you might find you don’t even have the right to obtain damages from the lessor for the situation in which you were put (Article 1794 (3) in conjunction with Article 883 (3) or with Article 19 (4) of the Civil Code).

Again, an excerpt from the Land Registry would prevent such a situation from happening.

3. The excerpt from the Land Registry can show whether enforcement proceedings have been registered

At least in Romania, the classic scenario is that in which the owner of the apartment that is for rent purchased it with the help of a bank loan. The bank, of course, holds a mortgage on the apartment in question.

Let’s put aside, for now, the scenario in which the bank’s mortgage is also accompanied by a ban on leasing the asset, a clause whose validity and efficacy surpasses the scope of this short article.

In a situation in which the owner – debtor in the credit agreement fails to pay several instalments, the bank will declare the full balance of the loan due and will proceed with the enforcement of its rights against its debtor and, primarily, in relation to the immovable asset offered for rent, upon which the bank holds a cause for preference (the mortgage).

One must note that, in such a scenario, the enforcement officer will request the registration of the enforcement in relation to the immovable asset in the Land Registry (Article 822 (1) of the Code of Civil Procedure).

If, however, you are unlucky enough to have concluded the lease agreement after this registration, your lease will not be opposable to either the creditor or the buyer of the immovable asset in the enforcement proceedings (Article 828 (1) of the Code of Civil Procedure), which means that the enforcement will continue whilst ignoring your right of use, up until your ejection from the apartment.

Again, an excerpt from the Land Registry helps, because then you will be able to see whether such an enforcement in relation to the immovable asset is registered.

The examples given above are just a few scenarios in which an excerpt from the Land Registry proves useful even in the case of a mere lease agreement. There are, however, multiple such hypotheses, from the possibility of having a ban on a lease – on which I touched upon above – to discrepancies between the description of the immovable asset, as it appears in the Land Registry and the way in which the apartment actually looks (at one of the viewings, the lessor confessed that he had extended the surface area of the apartment by occupying what would normally have been common areas for the whole apartment building) and so on.

The system of public record registration for immovable assets is by no means perfect, but, through the role it fulfils and the presumptions it creates (the presumption of non-existence of the right, act or fact removed from the Registry – Article 21 (2) of the Civil Code, the non-opposable nature of the rights, acts, facts and legal relationships subject to registration and for which the registration requirement was not met – Article 22 of the Civil Code), it can be an important ally in reducing or avoiding legal risks altogether.