Spasov and Bratanov successfully defended the rights of their clients individuals in claims brought by the State under Article 135 of the Obligations and Contracts Act (OCA) to declare a donation agreement and a subsequent real estate purchase agreement relatively invalid. The Supreme Court of Cassation did not allow a cassation appeal against the decision of the Sofia Court of Appeal, which dismissed these claims. The State legitimized itself as a creditor on the basis of a court decision for confiscation of the disputed the real estate under the Law on Citizens’ Property (repealed), which was subsequently overturned, and the case was remanded for new review and the proceedings were stayed pending the outcome of the claim on the basis of Article 135 of the OCA.
In its ruling the Court of cassation held that:
- The State cannot legitimise itself as the owner on the basis of a final decision under the Citizens’ Property Act (repealed) if the statement of claim has not been registered and the property has been transferred by the defendant before the registration of the court decision at the Property Register;
- The State cannot assert its rights against a third party who acquired ownership and registered this acquisition in the Property Register before the registration of the confiscation court decision. This applies to both the first and any subsequent acquirers;
- Overturning of the confiscation court decision results in losing the legal effect of the registration of this court decision. Such legal effect may reoccur only if the claim is upheld upon the new review of the case and following the registration of the new decision. However, the legal consequences of the new registration shall apply only prospectively.
We are proud that defending our clients led to a fair outcome and contributed to the development of case law in the field of property law and annulment claims. Our litigation team, involved in this case, was led by Boyko Bratanov, Partner.
Date: August 2025
Source: Spasov & Bratanov Lawyers’ Partnership