Vendors pull out AFTER exchange of contract

Welshwoofs

TonyMMM wrote: »

Whilst it is a terrible situation to be in, the OP is by no means assured of getting the house even through court action. The outcome at court will most likely be an order for the completion to go ahead by a specific date OR a sum of £xxx to be paid as compensation for breaching the contract. The vendor will then have to decide which they want to do.

Well doing a bit of reading around this, it seems that there's a principle that the buyer would get the house if damages were considered to be an 'inadequate remedy' - basically if the property is unique (the buyer couldn't go out and get another the same easily) and if the uniqueness matters to the buyer (eg they're not simply buying as an investment)

I dug up this info from 'Specific Performance and how to avoid it' by John McGhee QC

"The idea that a purchaser should be able to obtain specific performance of a contract for the sale of land because damages are an inadequate remedy seems at first glance to be a relatively safe proposition. It is a general principle that specific relief by way of injunction or specific performance is only awarded if a remedy by way of damages would be inadequate or, as it is sometimes put, it would be unjust to confine a claimant to a remedy in damages.

The application of the principle to land contracts may seem obvious. but that will not always be so. A purchaser might be purchasing a flat in a large block where there are numerous identical flats available. Or it might have organised a subsale and would be selling the property on immediately. Even if not selling on the property immediately it might be intending to retain it as an investment or to develop the land and sell it on once the development was completed. In those circumstances it is not obvious that it is necessary to do more than award the purchaser a sum by way of damages.

The justification of awarding the remedy to the purchaser on the basis that the property is unique no longer applies if it is not in fact unique or if its quality of uniqueness does not matter to the purchaser."

kunekune

Specific performance is a discretionary remedy, and so it is always possible that it could be refused. But the nature of the contract, the fact you haven't delayed or behaved badly yourself, is all in your favour. One situation where it might be denied is if it is useless - eg, for some reason the vendor is actually unable to convey the house to you. But it is your decision to request SP, it's not up to the vendor to choose.

kunekune

TonyMMM, I assume you're not a lawyer .... but if you are, I think you need to re-read your notes on equitable remedies.

Welshwoofs

kunekune wrote: »

Specific performance is a discretionary remedy, and so it is always possible that it could be refused.

*nods* yes - but it seems that it is unlikely to be refused if damages alone would be 'unjust' to the claimant. In our case, there are no other houses with the same number of bedrooms on the market in the town (it's rural so there's not a lot of choice full stop) and so damages would not be a lot of use to us since there's nothing equivalent for us to buy. In those circumstances I'd have thought damages would be deemed unjust since we, as the innocent party, would be subjected to even further inconvenience and suffering if we were to be put back to the house buying stage with nothing suitable to buy!

We were after a very specific type of property which has to act as a family home and has rooms for my other half to practice hypnotherapy from (plus parking space for 2 family cars + 1 client car) and this was the only one in a year of looking which fitted the bill. If a court refused to grant specific performance on those grounds it would be a travesty and IMO would send a big signal out that the house-buying process is a total sham.

silvercar

We were after a very specific type of property which has to act as a family home and has rooms for my other half to practice hypnotherapy from (plus parking space for 2 family cars + 1 client car) and this was the only one in a year of looking which fitted the bill.

can't your other half hypnotise the sellers.

"When I clap my hands you will pack up your belongings and shift your self out of my new home."

AMILLIONDOLLARS

It's has been a week and a bit since this saga unfolded, I think the shock of what has happened has dulled for all parties, solicitors included.

Now that Specific Performance has been served and the OP solicitors have informed them what it all means will concentrate their minds on making the right decision. If I were them, I would now be looking at the financial implications of not completing, Solicitors fees, EA fees, compensation etc.. I'd also be researching the internet on where I stand legally. You have called their bluff and they now know you are completely serious in persuing the matter, I can't see this going to court.

Hopefully, next week the whole thing will be settled for all parties.

Good Luck
AMD

GDB2222

Welshwoofs wrote: »

I dug up this info from 'Specific Performance and how to avoid it' by John McGhee QC

I read that with interest. It sets out the personal view of the author, which he admits is totally at odds with established practice. As he says:
"It would take a brave judge at first instance to overturn what appears to have been settled practice [ie specific performance] for 200 years."

He really only advances the proposition that damages rather than specific performance could be appropriate in particular circumstances: first if there really are near-identical properties for sale, and second for investment properties where the precise nature of the property is not so important to buyers.

Welshwoofs

GDB2222 wrote: »

"It would take a brave judge at first instance to overturn what appears to have been settled practice [ie specific performance] for 200 years."

Well I hope the vendor's solicitors have had a good read about that 200 year practice and have advised them fully on the chances.

Bruja_2

I have just read this thread right through for the first time and I want to wish you all the luck in the world Welshwoofs. Your anxiety levels must gone through the roof . I hope the outcome will be a lesson to all other money grabbing b______ds:beer:

kunekune

GDB2222 wrote: »

He really only advances the proposition that damages rather than specific performance could be appropriate in particular circumstances: first if there really are near-identical properties for sale, and second for investment properties where the precise nature of the property is not so important to buyers.

And you could get to that point quite easily on the basis of general principle anyway. If I was setting this story as an exam question, with the facts as Welshwoofs gives them, I don't think a single student would deny SP would be awarded. Well, not a single student likely to pass the module! Hardship can be a factor, but the cases involve vendors suffering from terminal illnesses and the like, not just unfavourable mortgage conditions!

It looks as though you are being well advised, Welshwoofs. Hopefully, behind the scenes, the same is true for your vendor and it will be settled without the need to go to the court.