50 years of the Breyne Law

1. What is meant by the "Breyne Law"?

The Breyne Law or the Housing Construction Law regulates the purchase of a house or flat that does not yet exist in reality (or at least not completely).

With such a sale, almost nothing is received in exchange for the payment because the construction has yet to begin or is simply not finished.

We can think of the following situations:

• Sales on plan
• A turn-key agreement

That is why the legislator wanted to provide extra protection against the insolvency of the seller or contractor. Hence the Housing Law, more commonly known as the "Breyne Law".

2. What is important?

2.1 Conditions for the private contract and the authentic deed

The Breyne Law regulates a number of issues which your private contract and subsequently the authentic deed must at least satisfy.

We give you some of these items below:

• The following elements are mandatory in an agreement concluded under the Breyne law:
  
  
  • The precise description of the private and common parts that are the subject of the agreement. This condition is important when buying a flat on plan;
  • The total price of a house or a flat or, when it concerns a conversion or extension of a building, the total price of that building;
  • The method of payment;
  • The commencement date of the works, the execution or delivery period and the compensation for delay in execution or delivery;
  • The way in which the provisional and final delivery must take place.
    
    
• In any case, the contract must be in a separate document, in bold characters, stating that the buyer or client has the right to invoke the nullity of the contract or the nullity of a clause that is contrary to the law, if the provisions of the Breyne Law concerning obligatory statements and the financial guarantee are not complied with by the seller or contractor.
  
  The words of these articles must also be included in their entirety in the agreement.

2.2 How payment must me fulfilled

The Breyne Law also stipulates how payment must be fulfilled:

• Before the contract is entered into, the seller or the contractor can not demand or accept any payment in any form whatsoever. At the conclusion of the contract, an advance or hand money may be demanded, but this can not exceed 5 percent of the total price;
• When executing the authentic deed, the seller or contractor may subsequently demand payment of a sum equal to the price of the land or a share that is being sold (in the event of co-ownership). In doing so, they must take into account the advance or hand money paid;
• If work has already been carried out at the time of executing the deed, a price may be asked for this. However, this price must be approved by an architect;
• The balance of the price of the works is only payable in parts from the day of execution of the deed. The partial payments may not exceed the price of the works carried out.

3. Sanctions?

Any term contrary to Articles 3 to 6 and 8 to 11 of the Breyne Law, and to the royal decrees issued pursuant to Article 8(2) of the Breyne Law, will be deemed unwritten.

Even if the provisions relating to compulsory statements (Article 7) and the financial guarantee to be given by the vendor or contractor (Article 12) or the royal decrees issued pursuant to these articles are disregarded, this will also render the contract null and void or render the clause contrary to the law null and void.

It is therefore important to be aware of this issue when concluding such an agreement. It is therefore a good idea to have your contract(s) checked for compliance with the Breyne Law.

If you would like to receive more information or assistance regarding the Breyne Law, your construction project or your contracts, please contact the specialists at Seeds of Law at info@seeds.law, koen.depuydt@seeds.law or ulrike.beuselinck@seeds.law.