São Paulo Court denies compensation in real estate delay case

The 6th Private Law Chamber of the São Paulo Court of Justice denied a request from homebuyers seeking compensation for delays in the delivery of a property. The plaintiffs argued that the developer failed to deliver the unit on time, causing them to incur rental costs and unexpected condominium and registration fees.

However, the court applied the principle of ‘exceptio non adimpleti contractus’ (exception of the unperformed contract) based on Article 476 of the Brazilian Civil Code. The ruling determined that the construction company could suspend its obligations because the buyers had not fulfilled their own, specifically regarding the full payment of the property. While a lower court had initially ordered the suspension of condominium fees, the higher court found that the buyers' failure to settle the balance according to the agreed terms justified the developer's actions.