GLOSSARY

Preliminary agreement - an agreement by which the parties undertake to conclude within a specified period of time the final contract, for example, sale agreement, exchange agreement, etc. This agreement must contain all the provisions upon which the validity of the final agreement depends.

Final agreement - an agreement concluded by the parties in the execution of the preliminary agreement.

Down payment - determined sum of money awarded by the buyer to the seller as security for the performance of the preliminary agreement, payable in cash or by bank transfer at the conclusion of the preliminary agreement (in this case the effects of the down payment occur as soon as the funds are credited to the bank account of the seller).

Advance payment - determined sum of money awarded by the buyer to the seller as a sign of the conclusion of the preliminary agreement. It does not have any consequences in the absence of the final agreement and is returned to the seller. It can be paid at any time until the signing of the final agreement.

Conditional sales agreement – the sales agreement under which the seller sells to the buyer the real property but the transfer of ownership of that real property is subject to the fulfilment of certain condition, such as non-exercising of the right of first refusal by the third party. It is necessary for the transfer of ownership to sign a separate agreement.

Acquisition of a real estate by a foreigner - a person who is not a Polish citizen may acquire real property after obtaining the permission of the Minister of Internal Affairs and Administration. It does not apply to the citizens of the European Union, with the exception of agricultural real property. The total exemption from the permit requirement applies to, among others, the acquisition of a flat.

Division of marital real property - prenuptial agreement, by which the spouses introduce a real property regime based on the fact that from the date of its conclusion, the current joint property is replaced by the personal property of each of the spouses. Each of the spouses independently acquires rights and incurs liabilities on account of their own personal property. In the objects belonging to the existing joint property, the share of the spouses is ½ part each.

The right of first refusal – the right of first refusal of the designated third party, in case when the owner of the real estate intends to sell it. The sale of real estate without the statutory right of first refusal will result in voidance of the sales contract.

Joint property – the asset items acquired during the statutory marital commonality by both spouses or one of them. The commonality includes, among other things: the received remuneration for work and other remuneration paid for other activities subject to remuneration performed by each spouse, the income from joint property and personal assets of each spouse.

Personal property – the asset items acquired during the statutory marital commonality by each of the spouses, inter alia, by way of donation, inheritance, bequest, acquired before the commonality obtained in exchange for items belonging to personal property, etc.

Land and mortgage register - a book in which the legal status of the real property is documented. It consists of four divisions: I – Designation of the real property and List of rights (the description of the real property) II – The ownership (the person of the owner is entered into the book), III - Limited property rights (easement, use), IV - Mortgage. Land and Mortgage register is maintained by the district court.

Mortgage – the right expressed in monetary sum, encumbering the real property, established by the owner to secure a bank credit, a loan or other obligation. The sale of real estate results in transferring the mortgage to the new owner.

Land property – a part of land which is a subject of separate ownership, marked with boundaries, consisting of registered parcels. It may be covered by one land and mortgage register.

Self-contained premises – a dwelling or utility premises for which there is a separate land and mortgage register.

Building property - the building connected permanently to the ground or a portion thereof, if under the law it may be a separate subject of ownership, e.g. building on the ground devoted to perpetual usufruct.

Registered parcel of land – part of land which is a separate ownership, marked with number in the land and mortgage registry.

Perpetual usufruct - the right to land close to the ownership right, but limited in time, for a maximum of 99 years. The land owner is the State Treasury or municipality. If there is a building on the land, the owner of the building is the perpetual usufructuary.

Personal servitude of an apartment - established by the owner on the real property (a dwelling) in favour of a particular individual, the right to live in and to use such real property till the end of life and free of charge.

Notarial deed - a document embracing the legal action, for which the form of a notarial deed is reserved by law, e.g. the transfer of ownership of real estate, the formation of the company or prenuptial agreement.

Certification of an authenticity of signature – a notary certification involving the notarial confirmation of the authenticity of the signature of the person on the document containing this person’s statement.

Commission of an agent - remuneration of an intermediary for the agency services.średnika za usługi pośrednictwa.

Notarial deposit - notarial act involving the deposit of a sum of money with the notary, in connection with other notary act made by the notary, for example, placing of a deposit at the preliminary agreement or part of the price at the final agreement.