Conformity and Non-Conformity in Sales in Catalonia

The lack of conformity (otherwise known as hidden defects in Catalonia due to its legal specificity) occurs when the good delivered does not match what was agreed or what the buyer could reasonably expect.

Although traditionally reference is made to warranty for hidden defects or eviction, in Catalonia these cases are integrated within the concept of lack of conformity of the good with what was agreed.

Thus, it is required that:

1. The seller delivers the good in accordance with the contract (at the time, place and manner agreed)
2. That the good possesses the characteristics that goods of the same type have
3. In the case of deficiencies or lack of conformity the following is expected:
   1. repair or replacement of the good
   2. suspension of the fulfilment of obligations
   3. termination of the contract
   4. price reduction
   5. compensation

Furthermore, if the buyer had known about the deficiencies they shall not be liable for them (only if they had been concealed).

In Catalonia, sales made from 1 January 2022 are governed by:

• The regulation is in the Sixth Book of the Civil Code of Catalonia, approved by Law 3/2017, 15 February, relating to obligations and contracts. Specifically, it is regulated in Title II, Chapter I, Section One in article 621.
• Furthermore, there was an important reform introduced by the Decree Law 27/2021 of 14 December, incorporating Directives (EU) 2019/770 and 2019/771, relating to contracts for the supply of digital content and services and contracts for the sale of goods, into the sixth book of the Civil Code of Catalonia. This decree incorporates EU Directive 2019/770 and 2019/771.
• In this article 621 of the Sixth Book of the Catalan Civil Code, paragraphs 621.20 to 30 stand out for conformity and paragraphs 621.37 to 40 for remedies.
• Additionally, according to 621.2 CCCat, if there are consumers in the sales, agreements to the detriment of consumers are considered not made.

In articles 621.20 and following of the Sixth Book of the CCCat, the Catalan law offers greater protection to the buyer than in Common Law, because the concept of “conformity of the good with the contract” is broader, as it implies what the buyer could expect according to the information received.

Furthermore,

1. It broadens the cases in which claims can be made. It is not necessary to fit the problem into rigid legal categories, but it is enough to prove that the good does not comply with what was agreed or with its purpose.
2. It reduces the burden of proof. The buyer does not always have to demonstrate that the defect was hidden, but simply that the property is not in conformity with the contract.
3. Catalan law allows greater flexibility in solutions, as the buyer can choose between different actions, such as repair, price reduction or even termination of the contract in the most serious cases.

Finally, this system better adapts to the reality of the real estate market, where the buyer usually relies on the information provided by the seller and does not always have the means to detect problems before purchase.

However, this protection is not absolute. The buyer will not be able to claim when they knew of the defect, could easily detect it or expressly accepted it in the contract.

The Catalan Civil Code, in its articles 621.37 to 621.40, allows choosing between:

1. Repair of faults and defects
2. Performance by equivalence in the case of real estate
3. Price reduction
4. Contract termination

The first option provided by Catalan Civil Law in the event of non-conformity is the repair or rectification of the defect, that is, that the property complies with what was agreed in the contract.

This repair implies that the seller must correct the anomalies, faults or existing defects so that the asset meets the agreed conditions. It may involve, for example:

• solving structural problems
• repairing defective installations
• eliminating damp or other significant damage
• rectifying situations that prevent the normal use of the property

In the field of real estate, unlike other goods, substitution is usually not possible, so repair becomes the main way to restore conformity.

In the event that it is impossible to repair a property, replace it or substitute it, a performance by equivalence can be claimed, whereby the buyer would receive monetary compensation. This money aims to put the buyer in the financial position they would be in if the contract had been properly fulfilled (and to alleviate the damage suffered).

In this case, according to 621.40 CCCat, the value of the property without defects is compared to its value with the defect; the difference is what must be refunded or deducted.

In cases of non-conformity in sales in Catalonia, assessing the defect is a complicated aspect. Sometimes, the repair cost is used as a reference (how much it costs to fix the defect to leave the property in the condition stipulated in the contract).

Finally, in the most serious cases of non-compliance, according to article 621.40 CCCat, the buyer may opt for the termination of the sales contract.

This implies nullifying the transaction, with the reciprocal return of the prestations. In this way, the buyer returns the property and the seller returns the price paid.

This option is reserved for cases where the breach is serious or essential, the property cannot be used for its intended purpose, and repair is not possible or is insufficient.

In the period for hidden defects in Catalonia, the seller must respond to the non-conformities expressed by the buyer from the moment the property is delivered until three years after delivery.

The repair of the possible defect will extend this period by one more year after the repair is completed, provided that the non-conformity is due to the same cause.