Apportionment to cover major works bill

Bazshawkins

We bought a leasehold property in January, which had an outstanding bill for some major works which were done a couple of years previous.

As part of the sale, the vendor agreed to leave a £4,000 apportionment with their solicitor to cover the final (at the time unconfirmed) amount on the invoice.

We have since had the final statement, which shows just under £500 owing. We contacted our solicitor about 6 weeks ago asking them how we went about getting the money from the vendor's solicitor. They told us that they'd send for our file (which was now in storage). I've contacted them periodically over the last 6 weeks and had no response to emails and voicemail messages, and now the Council (Freeholder) have written to us to say that if we don't pay by next week they will take us to court to recover the outstanding amount.

What is our position on this? I understand we're liable as the freeholder, but if we don't pay on time and incur interest or other fines, do we have any sort of case against the solicitor for taking so long to get the money from the vendor's side?

WestonDave

Depends on what was actually agreed.

If the vendors agreed to cover the full cost and just left £4000 on account, then you can recover costs from them - however there is an important legal principle here in that you must mitigate (minimise) your losses. So holding on and incurring fines and interest rather than just losing say deposit interest on the £500 risks you not being able to recover the extra. If you genuinely don't have access to £500 to cover the costs for now, then you might get such fines etc paid, but if you have the money or can borrow it then you would be advised to pay it now rather than incurring further costs as these might not be recoverable.

If the agreement was that they would pay £4000 towards the final bill expecting that to cover it, then you might not get any more, in which case you'd also get landed with the fines and interest. So on both counts it looks like its sensible to pay up and argue about it later! (Also bear in mind that if you argue too much over it you'll be out of pocket for solicitors fees as well!)

Bazshawkins

Thanks - just to clarify it is our solicitor that seems to be holding things up rather than the vendor. They left £4,000 on account with their solicitor and so it should have been as simple as our solicitor forwarding the invoice to theirs, and then the money being transferred.

If I was looking for compensation to cover lost interest or fines, then I'd be looking for it from our solicitor - the vendor has done nothing wrong and shouldn't incur any cost.