"Government ends homebuyers' total primacy over banks when builder goes insolvent" (with Natália Garcia Alves)

"The most immediate consequence will be seen in insolvency proceedings, i.e. when a promissory contract of sale has been signed, the builder of the property is declared insolvent and the insolvency administrator fails to sign the promised contract (of sale), the promissory purchaser who has a right of retention on the property will, with the legislative change now introduced, have their claim graduated for payment after that of the mortgage creditor," adds Natália Garcia Alves, a partner in SRS Legal's dispute resolution department.

For the lawyer, "one way of protecting the promissory purchaser in the event of the builder's insolvency could be to give the promissory contract of sale real effect, as in this case the insolvency administrator will be obliged to fulfil the promissory contract, i.e. to conclude the contract of sale, and the promissory purchaser will not be prejudiced against the mortgage creditor".