Portugal`s Supreme Court recently issued an important ruling aimed at consolidating case law, ending a legal and doctrinal debate over the priority of the right to withholding a mortgage. The Tribunal`s decision limited the priority of the right of detention to a mortgage on compliance with certain requirements. On the basis of the reasons for the decision of the Supreme Court of Portugal, it can be concluded that the following conditions must be met: (i) the buyer of the change of sola who has the right of retention is the consumer; (ii) the purchaser of a change of sola has credit resulting from non-compliance with the contract to purchase and sell promised real estate (with effects only between the parties); (iii) non-compliance with the sola exchange agreement is attributable to the seller of banknotes; (iv) the property of the sola change contract has been handed over to the consumer; and (v) the property is intended for habitation. It should be noted that the relevance of this decision also applies to legal actions. The question analyzed by the Supreme Court of Portugal was whether a buyer of a change of sola who entered into a contract to buy and sell real estate (which was not valid vis-à-vis third parties because he was not subject to registration) had the right to reserve to these real estate the right to pay his claim before being mortgaged on the same property in the context of an insolvency procedure. The buyer of the sola change was a consumer and the mortgagee a bank. As part of loans is usually requested a mortgage (hipoteca) on real estate and offered to ensure that payments are honored. Under Portuguese law, a mortgage is a kind of real guarantee that must be registered in the land registry to be effective and which gives the lender the right to pay against the value of certain real estate held by the debtor or a third party, usually in priority vis-à-vis unsecured creditors. The Portuguese Supreme Court found that the aforementioned deposit system was introduced in 1980 by a decree to safeguard the position of the solatory purchaser of real estate, particularly when the property is intended for residential use. The case law has so far been shared, although the majority considered that the right of retention prevailed over the mortgage which was based on the surrender of the property (traditio) as the object of the contract.
Nor was the doctrine unanimous; Some felt that the mortgage should prevail, with the exception of the right of retention of the purchaser of sola exchange when the property had been sold, since the sola exchange contract was not binding on third parties. The trial court recognized the consumer`s right to retain and his priority over the mortgage. However, the mortgagee appealed and the trial court ruled that the mortgage should take precedence over the consumer`s demand, since the change in sola was only effective between the parties.