Before addressing the legal question regarding the free acquisition of a building under Article 65 of the Property Act, an analysis of the legal framework and case law concerning the right to build (the so-called superficiary right) should be conducted. The right to build is established by a contract, which, according to the general rule under Article 18 of the Obligations and Contracts Act (ZZD), must be executed by notarial deed and constitutes a real right. This right allows one person to construct a building on another person's land and become the owner of the building itself, thus creating an exception to the rule that the owner of the land is also the owner of everything upon it. Often, the landowner enters into a contract granting the right to build for part of the intended objects in the future building with a construction entrepreneur, who undertakes the obligation to construct and commission the building. чл. 18 ЗЗД .

In the event of non-fulfillment of the obligation to construct the building within the agreed period, the landowner may terminate the contract through judicial proceedings, rendering it void. Another independent ground for the termination of the right to build is its extinction through prescription. The landowner may, without terminating the contract, directly invoke prescription by filing an action for ownership against the superficiary to whom the right to build has been assigned, if within five years from its establishment, the building has not been completed to the "rough construction" stage.

If the action is upheld, the right to build is extinguished by prescription, and it will revert to the landowner's patrimony, along with any improvements made to the land—constructed objects or floors—because a right to build established through a single contract with the landowner cannot be partially exercised. In this regard, Article 65 speaks of the free acquisition of the improvements after the contract's termination. However, what does "free" acquisition mean here?

Interpretation by the Supreme Court With the Interpretative Decision No. 1 from 4.05.2012 of the Supreme Court of Cassation (SCC), the Supreme Court's Civil Panel clarified certain issues and resolved contradictions in case law regarding the right to build. Specifically, it clarified the meaning of the term "exercise of the right to build" under Article 67 of the Property Act, when it is established through a single contract for part of the objects in a building consisting of multiple independent units, including in cases of subsequent transfer of the right to build to third parties. The term refers to the construction of the rough structure of the building or the corresponding stage for which a building permit has been issued.

Regarding the commencement of the prescription period, the Civil Panel provided mandatory interpretation, stating that the prescription period under Article 67 . begins to run from the moment the contract for its establishment becomes effective, irrespective of any subsequent transfers.

An interesting interpretation of the issue was made in Decision No. 31/01.03.2012, in Civil Case No. 641/2011 of the Varna Court of Appeal:
“The superficiary right is regulated under Article 63(1) of the Property Act, and according to the explicit text of Article 65, when a time limit for the exercise of this right has been agreed upon, and it is not met, ownership of the constructed property passes without compensation to the landowner. This is precisely the reason why the contract for establishing the right to build in favor of the plaintiff’s predecessor was terminated. The retroactive elimination of the rights held by the superficiary leads to the land being freed from the established limited real right, and the owners may freely develop it themselves or create a new real right in favor of third parties, which they did. At the same time, the termination of the contract for establishing the right to build in favor of the plaintiff’s predecessor directly affects their relationship. As a result, the plaintiff did not validly acquire the right to build, and thus cannot rely on its transformation into ownership of the constructed property.”

Article 65 of the Property Act raises issues regarding the requirement for the “free” transfer of ownership of the constructed property to the superficiary after the expiry of the agreed term. If we accept as correct the view that Article 65 refers to the duration of the superficiary right, the following situation arises: The agreed term expires, the right to build is not realized, and, by operation of law, the property constructed to that point passes into the ownership of the superficiary, as stipulated in Article 92 of the Property Act. But does this happen "without compensation"?

Regarding the consequences for the constructed property when the right to build is not exercised, the reasoning in Decision No. 64/22.04.2013 of the Varna Court of Appeal in Civil Case No. 109/2013 is particularly noteworthy: “The real effect of the contract for establishing the right to build makes it impossible for the contractual obligation consequences to take place upon its termination, i.e., the return of the exchanged prestations. Therefore, to regulate the relationship between the parties, the provision of Article 74(1) of the Property Act should apply. In this case, the defendant and the plaintiff in the counterclaim cannot benefit from the rights under Article 74(2) in conjunction with Article 72 of the Property Act. This is because we are not dealing with a typical situation where improvements were made with the knowledge and consent of the landowner. These improvements were made pursuant to a contract between the parties to establish the right to build and represent a reciprocal prestation under that contract. At the time the right to build was exercised, the defendant was a bona fide possessor, having undertaken the work with the intention to acquire ownership of the building. The termination of the contract due to non-performance of this reciprocal prestation renders the defaulting party a mala fide possessor—retrospectively eliminating the legal basis that would have made them the owner of the building.“

In light of this interpretation, we face the following contradiction: for example, A grants B the right to build for a term of 3 years. Within this term, the right is not exercised. A terminates the contract, and B invokes their rights under Article 74 of the Property Act, requesting the smaller of two amounts—either the cost of the improvements or the increase in the land value. A objects, asserting that under Article 65 of the Property Act, they become the owner of the improvements without compensation. If the court accepts that since the right to build was granted for a term, under Article 65, the provision of this article is lex specialis with respect to Article 74, A’s objection should be upheld. However, this could lead to unjust enrichment for A, the superficiary and create a practice that, although adhering to the letter of the law, results in unreasonable detriment to the patrimony of the superficiary.

Perhaps the solution in this case lies in interpreting the provision of Article 65 as dispositive, giving the parties the possibility to apply it partially. Moreover, in this context, the "free" transfer of ownership is not so much intended to protect the interests of the superficiary as it is to harm those of the landowner.

In the aforementioned court decision, the conclusion remains that the options of the superintendent after the right to build has expired and the latter has not implemented it is to cancel the superficiation contract due to non-fulfillment of the obligation to construct the building within a retroactive period. However, after the destruction, the latter cannot enjoy the rights of a bona fide owner, but enters into the rights of an unscrupulous owner.

He will be able to claim in court the improvements he has made to the other's property, the lesser of the two values ​​- the cost of making them and the increased value of the property. And if these reasonings, supported by abundant judicial practice, are confirmed, the question of whether they actually are is debatable ownership of the building passes "free of charge" to the owner of the land within the meaning of Art. 65?