When is the involvement of a solicitor essential?
Real estate matters
According to Hungarian law, legal representation is mandatory in procedures initiated upon request for the registration of rights and facts, but there are also real estate matters where the involvement of a legal professional is recommended. For example, in order to register ownership or other rights to real estate in the land registry, a contract prepared and countersigned by a solicitor (or notary public) is required.
Condominium matters
In the event of legal issues arising in relation to condominiums, such as the need to amend the articles of association or the rules of organisation and operation, it is important to know that the solicitor can record the amendment of the condominium documents in a deed based on the decision of the condominium general meeting. The solicitor must therefore either be present at the general meeting or, later, when the documents are signed, identify the co-owners who made the decision and signed the documents. Identification is carried out on the basis of personal identification documents, i.e. generally by viewing and photocopying identity cards and address cards or passports, as well as by completing an identification data sheet, not only in the case of condominiums, but also in other legal transactions.
Major lawsuits
Legal representation is also mandatory in certain more significant legal proceedings.
Company matters
Legal representation is also required in proceedings before the Commercial Registry Court, i.e. in matters concerning a company’s data entered in the commercial register. This may include proceedings for the registration of a company or changes to the company’s name, registered office, place of business, scope of activities, members, registered capital or managing director.
When is it advisable to seek legal assistance?
Real estate matters
In real estate transactions, it is often the case that the other party to the contract (e.g. the seller) chooses and appoints the solicitor. In this case, the solicitor’s fees are usually paid by the party who appointed them. According to the rules, if you are not represented by a solicitor in the legal transaction, the solicitor appointed by the other party must also represent your interests (e.g. as the buyer). However, practice shows that it is very difficult to reconcile the representation of the interests of the client and the opposing party (i.e. you). Real estate always represents a significant value, which is why we recommend that you always engage a solicitor, as this is the only way to ensure that your interests are fully represented.
Leasing/renting property
The involvement of a solicitor is not mandatory when leasing property. However, if you do engage a solicitor, they are obliged to identify the tenant and the lessor, and to examine the property’s title deed, primarily from the perspective of whether the person letting out the property is actually entitled to do so.
It often happens, for example, that ownership of a property is disputed and the parties turn to the courts in the absence of an agreement. These are usually complex legal issues and it can take years for the case to be finally resolved.
In our practice, we have encountered several cases where one of the parties to the litigation let out the property during the proceedings, before the final judgment was handed down. The tenant did not inquire about the legal status of the property, but paid rent for years to the lessor, who was found by the court’s final judgment not to be the rightful owner of the property, and the tenant only learned that he had been paying the wrong person when the rightful owner, as determined by the judgment, notified him.
In such cases, the tenant is obliged to pay the rent retroactively to the rightful owner. The tenant is, of course, entitled to reclaim the rent already paid from the landlord he believed to be the owner, but practice shows that this involves considerable costs and is quite risky, as the landlord who loses the lawsuit often goes into liquidation or otherwise becomes insolvent.