I have recently been talking about that we bought a house and about something that I’ve called preemptive authority (I’m not sure if there’s a better word for it in english or if it even exists outside the norwegian borders). Just to enlighten what it is: In norway one can buy an apartment or a house in a community. So if somebody within that community put their house out for sale then anybody can bid. In the end, somebody win that bid. After somebody have won the bid, it’s published in the community that the house will be sold for the price of the winning bid. If a member within the community want the house, then he can get the house for the same price as the winning bid and there is nothing the bid winner can do. He’s been overturned.
The preemptive authority requires that the community must do some work whenever a place is put out for sale, and therefore there is a fee involved. A rather large fee (4400 NOK) at that.
When we recieved the sales description, the fees were also listed as “Preemptive authority fee”. As the dupes we are we concluded that since we didn’t have a preemptive authority we wouldn’t need to pay the fee. Our conclusion was that this fee would have to be paid when somebody used their authority. Wrong!
Reason: The community still had to conduct the work behind preemptive authority, so we would be charged.
Well, since I’m not a person to accept it that easily I started to make some investigations. I talked to our real estate broker, which stated that this was common practice among all real estate brokers.
So I called the Norwegian Consumer Council. They pointed me to a law where this fee was explicitly mentioned.
§ 4-22. Gebyr
(1) Burettslaget kan krevje eit vederlag på opp til fem gonger rettsgebyret for å ta imot eit førehandsvarsel som nemnt i § 4-15 første ledd andre punktum. Blir forkjøpsretten gjort gjeldande, skal vederlaget betalast tilbake.
(2) Burettslaget kan setje som vilkår for å gjere forkjøpsretten gjeldande at forkjøpsretthavaren betalar eit vederlag på opp til fem gonger rettsgebyret.
(3) Føresegnene i paragrafen her kan ikkje fråvikast.
The english translation is something like this:
§ 4-22. Fees
(1) The community can demand a fee up to five times the courtfee to accept an advanced notice as mentions in § 4-15 first something, second statement. If the preemptive authority is used, the fee is to be repaid.
(2) The community can set as term that to apply the preemptive authority the one that has the preemptive authority must pay a fee up to five times the courtfee.
(3) The statements in this paragraph can’t be overturned.
In my mind the second statement pretty much tells me that I shouldn’t pay this fee.
But I didn’t get the real estate broker to agree with me, and there hasn’t been a court case about this, so either I have to go to a lawyer with it, or well, pay it up. The reason according to the broker is:
1. The fee was listed in the sale description, and we agreed to it when we made the bid.
2. The law states we have to pay it.
3. It’s common practice among real estate brokers, so therefore we have to pay it.
Our counter reasons:
1. Yes, it was in the sale description
2. We think the law says that since this only applies to those who use their preemptive authority, it doesn’t apply for us. Therefore the seller should pay this fee.
3. Even if it’s common practice it doesn’t make it correct within the law.
4400,- isn’t enough money for me to take it to a lawyer, so I just have to give it up, but I still don’t like it. I would really liked to hear what other people have to say about it.
In my mind this tells me that mostly all real estate brokers actually breaks the law.
The law: http://www.lovdata.no/all/hl-20030606-039.html (norwegian)
There are some new suggestions coming from the government to change the fee practice, so that the seller have to pay all the fees: http://forbrukerportalen.no/Artikler/2007/1185452472.13 (norwegian)