What should you pay attention to in an off-plan condominium purchase agreement?
Construction timeline and transfer of ownership
The contract must clearly specify the construction completion date, including both year and month. Developers usually reserve the right to extend the срок by up to one year.
Consequences of delays*
Option 1:
The buyer terminates the contract, the developer refunds all payments received, and pays a penalty to the buyer (as specified in the contract, but not exceeding 15% per annum).
Option 2:
If the buyer agrees to wait for completion, they are entitled to a penalty of 0.01% per day of delay, calculated on the amount paid under the contract, capped at 10% in total. Once this limit is reached, the buyer may terminate the contract.
Option 3:
If delays occur due to force majeure, the buyer may terminate the contract and claim interest based on the rate set by Krung Thai Bank.
*According to the standard condominium sale and purchase agreement approved by the Thai Ministry of Interior. Leasehold agreements may contain different terms.
When to take action
Legal action should generally be taken only after the developer has missed the contractual deadline.
If construction is ongoing but you suspect it may not be completed on time, this alone is not sufficient grounds for filing a claim — the developer may still meet the deadline.
However, if the ownership transfer is due in one month and there is not even a foundation pit at the construction site, the delay can be clearly demonstrated. In such cases, it is possible to file a claim even before the contractual deadline.
What to bring to a lawyer
– Sale and purchase agreement with the developer
– Payment receipts for all installments
– Correspondence with the developer (if available)
– Copy of your passport
The original agreement may be required at a later stage.
Which court to apply to
This depends on the dispute resolution clause in the contract and the specifics of the case. It may be:
– Civil Court (general jurisdiction)
– Consumer Protection Court
– Commercial Court
The differences are significant — from court fees to the duration of proceedings.
Court costs
– Civil Court: 2% of the claim amount, capped at 250,000 baht (for claims up to 50 million baht)
– Consumer Protection cases: no court fee for the claimant
– Arbitration fees depend on the claim amount
Additional costs may include:
– Translation of documents into Thai
– Court interpreter services
– Expert assessments
– Legal fees
Procedure
The first step is to prepare and send a formal claim to the developer.
If the developer refuses to comply or does not respond, the next step is filing a lawsuit.
The duration of proceedings depends on the complexity of the case and the court’s workload. The first hearing typically takes place within several months.
At the initial hearing, the parties are encouraged to reach a settlement. If no agreement is reached, the case may last several years.
The claimant’s physical presence in Thailand may be required for testimony and the announcement of the court decision. All other actions, including filing the claim, can be handled by a lawyer.
Bankruptcy procedure
There are two possible scenarios:
1. Buyer as creditor
If the developer has entered bankruptcy proceedings and you have paid for the property, you must join the case as a creditor.
You may do so after the first hearing. If you fail to file your claim during the bankruptcy process, you will not be able to recover funds afterward, as all debts will be considered discharged.
2. Buyer as actual owner
If the property has been fully paid for and the developer has already received the chanote, but ownership (or leasehold rights) has not yet been registered in your name, the situation differs.
In this case, the property is effectively considered to belong to the buyer.
You must file a petition with the bankruptcy court to exclude the property from the developer’s assets, providing:
– the sale agreement
– proof of full payment
This petition must be filed before the first bankruptcy hearing. The court may decide to exclude the property either before or during the first hearing.
Additionally, you may join the bankruptcy case as a creditor for unpaid guaranteed rental income.
You may claim both:
– overdue amounts
– future unpaid amounts for the entire duration of the guaranteed rental agreement
The court will decide at its discretion whether to satisfy such claims.
Author: Alexandra Agapitova.
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