Hypothetical Question - Completion

thiscounty

I have a hypothetical question about the conveyancing process, all parties in a 6 person have exchanged. I am person number 3 in the chain. Exchange has taken place and all parties are due to complete next Friday. All parties need to move on that day into the new homes.

The solicitor at the top of the chain is unable to complete because the solicitor is ill, because of this the whole chain does not complete. Would I be liable to pay any compensation to other parties below or above me as it was not my fault the chain could not complete.

What if my buyer still wants to complete but the property I am buying does not want to because the upper part of the chain wont move and they dont want to become homeless.

What would my liabilities be? Could I have to pay extra costs and interest?

I'm worried as the sols at the top of the chain is a one man band operation and has been having sick leave left right and centre I worried he will be ill on completion day.

dunroving

My admittedly logical (not legal) take on it is that you only have a contract with the people directly below and above you. Why you or they choose to not complete is somewhat irrelevant.

On the basis of my logical rationale, if you don't complete with your buyers, you are liable to them for any damages, expenses, etc. Similarly, if your seller defaults, they are liable for your expenses, etc.

So, if the people above you don't complete, you have two choices: (a) either you stay where you are/don't complete on your sale and thereby your buyers can take you to court, or (b) you do complete with them, move out to temporary accommodation, storage, etc., and deal only with the people above you.

AnotherJoe

thiscounty wrote: »

The solicitor at the top of the chain is unable to complete because the solicitor is ill, because of this the whole chain does not complete. Would I be liable to pay any compensation to other parties below or above me as it was not my fault the chain could not complete.

I am pretty sure that would not be the case.
AIUI completion starts at the bottom and ripples upward.
So if 6 didnt complete, then 5 would be stuck but 1- 5 would all have completed 'downwards"

So, selfishly, odds are you'd be OK.

If, hypothetically 5 didn't move out (though in reality the money would have changed hands from 4->5 and 5 would be waiting outside 6's house whilst 4 is moving into 5's house) and then because of that 4 didnt move (same unlikely scenario) then you are due comp from the people who arent moving and can roll up the comp from the one below you you have to pay.

EDIT; ps fault is irrelevant in these matters apart from the one who initiated it to start, which in this case would be 6 who would be liable but should be able to claim from the solicitor /solicitors insurance. But in the very unlikely event you couldn't move, then the person below you claims costs from you, and you claim your costs plus those costs from the person above.

franklee

Agree with the other replies, the money goes up the chain from number 1 who is just buying and not selling to number 6 who is just selling.

As the money goes up the chain it won't matter to you if number 6 defaults. Your buyer (number 2) can still afford to pay you. Therefore you move out. If your vendor (number 4) doesn't give you vacant possession on time then you sue your vendor. However he will likely vacate, as will number 5. His removal company will put his stuff into store and he will stay in a B&B until it's sorted probably on the next working day and then claim his costs from number 6.

Worse than the solicitor being ill, he likely has other staff who can cover, is your vendor dying. Then you may have a longer wait for all to be sorted.

However what you really need to worry about is the bottom of the chain failing, perhaps number 1's mortgage offer gets pulled. Then the whole chain really does collapse as there is no money to move up. So you will default on your purchase and can be sued. OK you can pass costs to number 2 who in turn passes them onto number 1. If number 1 cannot afford to pay all the accumulated costs then number 2 pays even though it wasn't their fault. Hopefully at number 3 you will be OK if number 2 can afford to cough up, if not you are on the hook for the outstanding costs of 4-6.

Still failure to complete is unlikely and even if it does happen most times it's resolved within a working day or 10.