Unilateral Notice - Removal

John_Berry

Thats exactly how it is.

I've asked the land registry to provide the document filed along with unilateral notice so hopefully it should tell us some more information. I have no idea how much deposit was paid in 2003. I'm assuming 10% so it would be around 18-20k in 2003. As soon as i get anymore information i'll post it up.

Dvardy you are a star and a legend. Are you a professional law person by any chance who's services i could invoke?

DVardysShadow

No, I am not a professional legal person!!!

What I think here is that as long as you don't own it and as long as you do not appear to be an intermediary of the bank you are in a good position to negotiate a possible settlement - the thwarted buyer can speak to you more freely than he can to the bank without prejudicing his position. The legal people will not help you here, they do adversarial work on the one hand - fighting their client's position and they implement things which are agreed on the other hand - but the bit in the middle, negotiation, is not a core skill for a lawyer, in my opinion.

The law is just a set of bargaining chips, very often. And quite plainly it is the case here. You can have a fight about the bargaining chips. But while you don't own the house, you are not in a game where the thwarted buyer's legal bargaining chips count for anything. So you need very little grasp of the legal position beyond what has been discussed here. Enough to know not to fight it on the detail of the law - this can only be fought legally on detail. This makes it better to buy him out.

I am probably not a natural negotiator. But if you understand the principle, it is not too difficult. If you see a TV in a shop which is end of range and has a scratch, you might want to negotiate. Now that does not mean bargaining the retailer down and the retailer bargaining you up, it means finding a price at which firstly you feel you are better off with the TV and without the money and the retailer feels better off with your money and without the TV in stock. So it is not "I won't pay a penny over X", "We won't accept a penny less than Y". More "Would you be happy with X", "No, but we would be happy with Y".

This case is similar, both the bank and the thwarted buyer have scratched end of range TVs in their own ways. The bank has a house spoiled by a unilateral notice, the thwarted buyer has a legal claim muddied by the former owner's bankruptcy. But they are unable to negotiate. Probably both have too high an expectation of what the other should be giving. You are stood in the middle and have an opportunity to negotiate both ways.

I did suggest a possible value of the thwarted buyer's losses. I would estimate that in today's values we are looking at £25k to £30k. Reduce that to the percentage payout from the bankruptcy. Deduct his legal fees. You can make a better offer than his cold light of day expectations. Likewise the lender, you could drop your offer by less than they expect a payout would cost. You should have enough in it to cover your extra legal costs and a little more. It could work. You could even be happy to pay a little more. But you can find out reasonably quickly and cheaply as long as you keep lawyers out of it until you have an agreement for them to implement.

John_Berry

I've got an appointment to view land registry files on Monday so I should get to know how much the deposit was and what proof of dispute he has.

Then we can try and see if the buyer can be quietened down and if the bank will negotiate to cover the additional costs. It would be better to pay a little more now resolving the unilateral notice before purchasing the property for that added peace of mind.

I reckon you should enter professional law even on a part time basis as you are very good at grasping the situation and balancing possible scenarios and outcomes based on the information provided. Many professionals in all industries are just paper credited and lack the skill and drive to make a real impact in what they do. For instance some doctor's won't even check for head pains and will just prescribe paracetamol's to their patient and hope the pain goes away, but you definitely have the makings of someone who would do a good job.

silvercar

If I was the 2003 buyer, my starting point would be all the gain in value the property has made since 2003.

If I was the repossessing lender, I would serve notice on the 2003 buyer - the property is now available, pay up and take it - assuming that the 2003 price would clear the majority of the debt.

DVardysShadow

silvercar wrote: »

All complicated further by the bankruptcy meaning that any money left over after the lender has recovered mortgage and costs should go to the Official Receiver, who should be ensuring that the price obtained is reasonable market value.

silvercar wrote: »

If I was the 2003 buyer, my starting point would be all the gain in value the property has made since 2003.

If I was the repossessing lender, I would serve notice on the 2003 buyer - the property is now available, pay up and take it - assuming that the 2003 price would clear the majority of the debt.

Maybe the bank would actually like to serve notice, but have to satisfy the Official Receiver? Maybe the OR is expecting repo 2010 values and not 2003 quick sale values?

Maybe the thwarted buyer is not actually in a position to complete the purchase or not able to force the purchase but is in a position to keep the notice in place?

John_Berry

I'm currently looking up the frustration of a contract. It states that a contract ends when due to no fault of either parties, they are prevented from carrying out their obligations, i.e an act of war stops you going to an enemy port. You would be breaking the law if you carried on.

In this case the May 2003 buyer was prevented from purchase by a court inhibition notice issued in July 2003. The sale could not go ahead and the contract became frustrated as the seller could not dispose of the property and the obligation to complete would seize to exist. The vendor should have returned the deposit less sellers expenses.

The buyer also only registered his interest in Aug 2007 after the bankruptcy notice was filed in January 2007. How would the receivers know and believe if he registered his interest after the bankruptcy. There isn't away of proving if his claim is true or valid But He is using the unilateral notice as a cunning chest move. The 2003 buyer can't loose as he has already lost his deposit in 2003. No disrespect to him but he is using the unilateral notice to stir up sum wind.

The banks are definitely winning all the way. The property in 2010 is worth more then 3 times the amount the banks gave in 1998. The difference is too great to not take notice between 2003 and 2010 prices. Prob over 120k difference now in 7 years.

kmmr

I do think the key thing is to deal with this before you buy. You lose a lot of leverage once you are the owner, but you have a good position to get it resolved as a buyer now.

This is clearly a 'problem' property, so if you are willing to do the legwork and sort out the legal problems, you could get a good property that most people walked away from as it was too difficult.

Good luck.

DVardysShadow

John_Berry wrote: »

I'm currently looking up the frustration of a contract. It states that a contract ends when due to no fault of either parties, they are prevented from carrying out their obligations, i.e an act of war stops you going to an enemy port. You would be breaking the law if you carried on.

In this case the May 2003 buyer was prevented from purchase by a court inhibition notice issued in July 2003. The sale could not go ahead and the contract became frustrated as the seller could not dispose of the property and the obligation to complete would seize to exist. The vendor should had to return deposit less sellers expenses.

The buyer also only registered his interest in Aug 2007 after the bankruptcy notice was filed in January 2007. How would the receivers know and believe if he registered his interest after the bankruptcy. There isn't away of proving if his claim is true or valid But He is using the unilateral notice as a cunning chest move. The 2003 buyer can't loose as he has already lost his deposit in 2003. No disrespect to him but he is using the unilateral notice to stir up sum wind.

The banks are definitely winning all the way. The property in 2010 is worth more then 3 times the amount the banks gave in 1998. The difference is too great to not take notice between 2003 and 2010 prices. Prob over 120k difference now in 7 years.

Yes, it is a frustrated contract. But whether or not it was permanently frustrated, we don't know.

But does it matter? Only if someone is to take it to law.

The picture is as simple or as complicated as you want to make it. At its simplest, if you can get the notice withdrawn, then you don't have a problem. At its most complicated, you need to understand frustrated contracts and bankruptcy and come to a view as to whether the contract was stopped off by the frustration or by the bankruptcy. All law.

It is useful to understand the background - but leave the detail. If you understand how the thwarted buyer feels and why and you understand how the bank looks at it, you have a chance [but not the certainty] to get a deal where the thwarted buyer, the bank and you are all better off. It is mostly to do with understanding motivations and the basis for everyone's position and very little to do with the law.

Once you understand that this would be a mess to clear up legally, that is all the applied law you need to know! Your opportunity is to get the thwarted buyer to remove the notice by providing him more than the law will.