Exchanged to save chain but contract not honoured

Hahuja

Hi,

I have exchanged contract last month to save chain to collapse as it was hanging for few months. The only stcking point was that the house I am buying has some land missing from the title (small bit from the front garden). My solicitor advised that if your sellers solicitor puts in writing on the contract that this missing land issue will be sorted before completion its ok to exchange as they had 2 months to get this sorted.

Now just 4 days are left for complition and the matter remains unresolved. We are all packed up and excited to move but not sure where we stand as they are at fault not me. Even I refuse to complete my buyer will sue me...not sure what to do here. Spoke to my solicitor but they say we are trying to get this sorted but I have my doubts.

tberry6686

It won't just be your buyer suing you if you don't complete. In short you would be liable for all extra expense from everyone involved in the chain.

Argghhh

you would have to complete then sue for breach of contract but discuss this with your solicitor

eddddy

Hahuja wrote: »

... My solicitor advised that if your sellers solicitor puts in writing on the contract that this missing land issue will be sorted before completion its ok to exchange as they had 2 months to get this sorted.
...

What terms exactly were included in the contract? Those terms may or may not allow you to refuse to complete.

If you do refuse to complete due to a breach of contract by your seller...

... you're correct, you are likely to be sued by your buyer...

... but then you would sue your seller to recover your losses (including the amount your buyer sues you for).

i.e. Your seller ends up having to pay your and everyone else's losses.


But the amounts of money involved could be huge. So make sure that your solicitor is 100% certain that all losses will fall on your seller (and not you), if you fail to complete.

stator

Do you have a mortgage pending for this purchase?
Will the lack of land affect your mortgage?

If not just complete and then sue if they don't sort out the land registration.

silvercar

stator wrote: »

Do you have a mortgage pending for this purchase?
Will the lack of land affect your mortgage?

If not just complete and then sue if they don't sort out the land registration.

Very good point, the lender may not be willing to allow you to complete without this point being sorted.

That said, I would be inclined to complete with a retention of enough money to ensure it is in the seller's interests to sort it.

So your solicitor withholds say £10,000 until the legal stuff is corrected.

Hahuja

Contract says we will do our best to arrange to get this missing land transferred before completion.
We like the house and want to complete but also don't want someone claiming on that small bit of our land after few years. I am thinking of holding some money for my buyer as its their responsibility to get this done.

Hahuja

Their solicitor did get the land transferred but for some reason land registry people have left tiny space (worth 2 garden chair) which is what they are trying to establish why.
I do have a mortgage linked but they are not aware of this missing land fact so I do not see any issue...I hope.
Yes this is exactly what I am thinking of asking my solicitor to hold their £10k until legal stuff is sorted out...although they have been trying this for 2 months now.

eddddy

Hahuja wrote: »

Contract says we will do our best to arrange to get this missing land transferred before completion.
We like the house and want to complete but also don't want someone claiming on that small bit of our land after few years. I am thinking of holding some money for my buyer as its their responsibility to get this done.

Hmmm... if the contract really does say "do our best" or "best endeavours", you have no real case. (How would you define in court what their 'best' is, and prove that they didn't 'do their best'.)

I'm very surprised that your solicitor didn't give you dire warnings about this.

Unfortunately, you can't just decide to hold back some money (unless it says you can in the contract). If you don't offer full payment on completion day, the result may be catastrophic for you.

Realistically, they will argue that they have 'done their best' and then leave you to sort it out - and you will have no recourse.

Hahuja

eddddy wrote: »

Hmmm... if the contract really does say "do our best" or "best endeavours", you have no real case. (How would you define in court what their 'best' is, and prove that they didn't 'do their best'.)

I'm very surprised that your solicitor didn't give you dire warnings about

It does say we will use our best endeavours to deal with any requisitions to ensure this land is registered to the seller prior to complition. My solicitor wrote to me separately to say they do not see any reason why this can't be done.

I have just heard back from my solicitor and they are now going to submit another transfer application with land registry tomorrow and this process could take further 3weeks but complition is after 3 days:(

Land_Registry

Hahuja wrote: »

I have just heard back from my solicitor and they are now going to submit another transfer application with land registry tomorrow and this process could take further 3weeks but complition is after 3 days:(

Your OP refers to the title you are buying as not including a small piece of land in the front garden. I assume therefore that this small piece of land is unregistered rather than registered to someone else.

As such I am unclear as to why another transfer application is being submitted - do you mean that they are trying to get the land included in the existing title or are applying for it to be registered for the first time?

You also refer to 'Their solicitor did get the land transferred but for some reason land registry people have left tiny space (worth 2 garden chair) which is what they are trying to establish why.', which suggests they have asked why it was not included in the first place. If that is the case then the 'new application' might be to get it registered following our response i.e. if you lodge this we will register it (best case scenario).

Note - if it was not included when the title was first registered and an application is now being made to register it then I would assume that it was omitted as no title was shown to it originally. If your sellers' solicitor did get it transferred then I suspect their purchase triggered the properties first registration and as title was not shown the land in question was excluded. If that is the case then that may help you and your solicitor understand the risks attached to completing and then resolving the issue.

A lot of assumptions made though so it might help to understand exactly what you are now applying for as 3 weeks sounds to me as if the loose ends simply need tying up as your solicitor knows what we require and has provided it - is that the case?