Why This Review Matters

On July 1, 2026, the Russian Supreme Court (VSRf) published a judicial practice review on real estate transactions — following the high-profile Dolina case. The document fundamentally shifts judicial doctrine: lower courts are now officially prohibited from protecting defrauded sellers at the expense of good-faith buyers.

This is a systemic turning point. Here are the five key blocks.

Block 1. A Seller’s Mistaken Motive Does Not Void the Transaction (Article 178 of the Civil Code)

Supreme Court position: a seller’s mistaken belief about the motives for a transaction — for example, believing they must sell an apartment to “protect funds from fraudsters” or transfer money to a “safe account” — is not grounds for voiding the transaction.

Previously: courts sympathized with elderly victims and voided transactions under Article 178 (material mistake). Lawyers argued “psychological pressure” and “distorted will.”

Going forward: the Supreme Court drew a sharp line between will and motive. Did the seller understand they were signing a purchase and sale agreement? Did they understand title would transfer to another person? Then the transaction stands. A mistake about motive — believing they were “protecting savings from imaginary enemies” — is the seller’s personal risk, not a ground for reversal.

Block 2. Third-Party Fraud Does Not Transfer Liability to the Buyer (Article 179 of the Civil Code)

Supreme Court position: a transaction made under the influence of fraud can be voided only if the buyer itself knew or should have known about the fraud. If the fraud came from third parties — telephone scammers, fake “FSB officers” — and the buyer had no part in it, the transaction stands.

Previously: an open criminal investigation was often sufficient. Courts would void the transaction, leaving the buyer to bear the consequences.

Going forward: a strict filter has been introduced. To recover the property, the seller must prove the buyer knew about the fraudulent scheme. No evidence of collusion — the property stays with the buyer.

Block 3. Market Price as a Good-Faith Benchmark

Supreme Court position: a significant undervaluation of price in the contract is an automatic marker of the buyer’s bad faith.

Fraudsters often rush victims and pressure them into listing properties at 30–40% discounts. Buyers celebrated the “bargain” without asking why.

Going forward: if you bought a property significantly below market value, courts may treat this against you. An extremely low price should have raised suspicion in a reasonable buyer. Bought for a song? Be prepared to prove good faith under intense scrutiny.

Block 4. Mandatory Due Diligence Standard

Supreme Court position: a buyer’s good faith must now be demonstrated through active verification steps before the transaction.

Previously: an extract from the Unified State Register of Real Estate (EGRN) and the seller’s physical presence with a passport was usually enough.

Going forward: courts will require buyers to show an “architecture of diligence”:

Were psychiatric and drug-abuse clearance certificates requested on the day of the transaction?
Were archival extracts showing the property’s transaction history checked?
Was payment made through secure instruments — a letter of credit or safe-deposit box?
Was the seller’s behavior monitored for signs of stress or coercion?

A buyer who approached the transaction superficially may be denied the protection afforded to good-faith purchasers.

Block 5. Losses Must Be Recovered from Fraudsters, Not Buyers

Supreme Court position: losses from fraudulent conduct are to be recovered through criminal proceedings — via a civil claim against the guilty parties. Not by seizing the apartment from a good-faith buyer.

Previously: defrauded sellers took the path of least resistance — voiding the civil transaction and reclaiming the property from the buyer. Far simpler than tracking down the fraudsters.

Going forward: the Supreme Court ends this practice. Were you defrauded? Become a recognized victim in the criminal case and pursue compensation from the perpetrators. Yes, it takes longer — but it is the fair allocation of risk: criminals pay, not an innocent buyer.

What This Means in Practice

For buyers: the review strengthens your protection, but simultaneously raises the bar on diligence. A superficial pre-transaction check may now cost you your good-faith status. Work with a lawyer during Due Diligence — not after the deal closes.

For sellers who were fraud victims: the path to compensation now runs through criminal proceedings, not through taking property from an honest buyer. As soon as possible, obtain victim status in the criminal case and file a civil claim within those proceedings.

Red flags that now count against buyers:

Price significantly below market,
Seller rushing the transaction,
No archival extract of prior transactions on the property,
Cash payment without banking instruments.

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Planning to buy secondary market real estate, or facing a claim challenging your transaction? Contact us for a written legal opinion — we will conduct a legal audit of the transaction in light of the Supreme Court’s current position.

Russian Supreme Court Review 2026