Claiming back solicitors fees

teddysmum

Permission for a shed is surely not going to cost as much as your loss if you withdraw and as pointed out above rules set on a new estate are often ignored once the builders have withdrawn.

Our estate had a rule that all front gardens were to be left open and no hedges or walls were to be put around lawns. In fact, my father worked for the builders and was sent, with a colleague, to demolish a really well built (his words and he was a master bricklayer) 60cm wall, when the company was still building.

Nowadays, and for years, many lawns are turned into extra parking and gardens surrounded by hedges and low walls (some dangerous as the walls are topped by metal spikes ) .In a few cases large corner lawn plots have been enclosed using fences and hedges over 150cm high, yet no one has been told to remove them.

In the original deeds it also states that no brewing is to be done (as the land was once owned by Burton's Brewery) and no fowl to be kept in gardens.

AdrianC

jimspark wrote: »

We have just had to cancel our reservation and pull out of the purchase of a Newbuild freehold property. The reason being that we were not advised that the property deeds contain various covenants relating to estate/management fees, rentcharges, heat supply agreements, application and cost implications for the sale of or alterations/additions to the property amongst other things at the time of reservation.

Not "had to". Chose to.

We only found out about these things when we received the property document pack

And your solicitor did his job, and explained the contents of it to you. You then made a decision based on that.

6 days (4 working days) before exchange.

Exchange is when you're ready to exchange, not before.

At this point we have already lost £150 of the reservation fee and £300 on solicitors searches. We are now awaiting the solicitors abortive bill.

And that's all part of the financial decision to walk away that you made.

My question is has anyone been in a similar position and had any success on reclaiming the solicitors fees from the developer based on the fact that they did not disclose enough information about the property for us buyers to make an informed decision when purchasing?

But they did... They provided that information, and you made that informed decision before purchasing.

Just for clarity, the solicitor is from the developers recommended panel that we were 'forced' to use (insofar as they pretty much said that an outside solicitor would not be able to complete the purchase on the required timescale and we would therefore lose the property).

Again, you weren't "forced". You chose to. You took the vendor's claims at face value, and decided based on that.

We have received no help or advice from the solicitor. These issues with the property only came to light through us reading through every document in detail and carrying out our own research.

Don't use that solicitor again. They're not very good.

A less charitable view would be that they value their relationship with their other customer, the developer, too highly to be absolutely objective. Which, of course, is why developers "recommend" solicitors in the first place.

We only received answers to (some) of the questions we put to the solicitor, the day before exchange.

If you didn't have answers to every question, you weren't ready to exchange.

Surely they should be required to provide this information at the point of reservation, not a few days before exchange at which point a buyer is already financially and emotionally invested in the property?

Oh, you'll love buying a "used" house, then...

"Reservation" simply says "We promise faithfully not to sell this particular plot to anybody else while you do all your pre-purchase due diligence". It's that DD which has brought the issue you have with their standard covenants etc to light. Remember, everybody who does buy is clearly happy with them...

ethank

jimspark wrote: »

We had no plans to extend but would have liked the option to install a sat dish/shed etc. Any of which would have required a permission (that would carry a charge) from the management agency.

I had that my covenant on the first house, I instructed my solicitor that I would not exchange unless it was removed. I have since bought another two new builds and done nothing, I just installed the satellite dishes in both places. No one batted an eyelid.

Drive round the site and you'll see everyone ignores the covenants :rotfl:

jimspark

Not "had to". Chose to.

We felt we 'had' to due to not knowing the exact nature of the fees going forward. I suppose we did 'choose' in the sense that no one forced us.

And your solicitor did his job, and explained the contents of it to you. You then made a decision based on that.

I am not debating that or necessarily the solicitor charging for this service. My issue is with the lack of information given to us by the developer at the time of reservation in order to make an informed decision about the purchase.

Exchange is when you're ready to exchange, not before.

Exchange according to the developer is the date on which the reservation expires, in our case 28 days from the date of reservation. We do not get a say in this as new build buyers.

And that's all part of the financial decision to walk away that you made.

Fair enough, but why is it okay for us to be left (possibly substantially) out of pocket for this? It's not like these covenants, rentdeeds, management contracts etc were unknown to the developer (or the solicitor). They have sold other houses here. Unlike an older property where I can imagine there may well be unknown covenants etc buried in the deeds somewhere.

But they did... They provided that information, and you made that informed decision before purchasing.

Yes. Again, once we had already paid out money towards the potential purchase of the property.

Again, you weren't "forced". You chose to. You took the vendor's claims at face value, and decided based on that.

Fair comment, I simply added this for some perspective on the situation. We didn't set out to use this solicitor. We were 'encouraged' to by the developer.

Don't use that solicitor again. They're not very good.

A less charitable view would be that they value their relationship with their other customer, the developer, too highly to be absolutely objective. Which, of course, is why developers "recommend" solicitors in the first place.

Sound advice

If you didn't have answers to every question, you weren't ready to exchange.

Again, the exchange date was dictated by means of the reservation agreement. It was either buy on their terms or not at all

Oh, you'll love buying a "used" house, then...

Perhaps it is me being naive but I would expect there to be many more unknowns with an older property. Not on a new build when the developer and their panel solicitors are all well aware of the ins and outs of the properties and information is not passed to buyers through choice rather the lack of information available

"Reservation" simply says "We promise faithfully not to sell this particular plot to anybody else while you do all your pre-purchase due diligence". It's that DD which has brought the issue you have with their standard covenants etc to light

Perhaps yours did. Ours says that we must exchange before the reservation expires and that the developer must inform us of all charges associated with the property ... which they didn't

Remember, everybody who does buy is clearly happy with them...

Good point, perhaps that explains why both the sales rep and the broker seemed slightly taken aback by what we'd found within the smallprint and suggested that we had looked into it further than most. Our solicitor had to request additional information from the Developers solicitor which we found strange considering they are the developers panel solicitor for this site. We weren't asking anything I could think as unusual.

I would imagine that given the combination of the timeline pressure to exchange, the encouraged use of panel solicitors, the probable lack of knowledge/experience of the buying process for many first time buyers (like us - it is the first time after all) mixed with the promise/excitement of getting a brand new house likely with incentives thrown in and the probable bonus of HTB might make some buyers sign on the dotted line safe in the knowledge that their panel solicitor will have acted in their interests and made them aware of any potential issues.

But then hey, if everyone else does it must be okay right?

Maybe I'm missing something here or I'm just plain wrong (in which case I hold my hands up) but just to reiterate;
I have no issue with the solicitor charging for their services, it is the developer that our question relates to.

Why and how is it the norm for developers to not disclose all of the information on a property (which they will obviously be aware of) before the potential buyer parts with their hard earned?

So just to take it back to my original question, I assume the consensus is that we will just have to swallow these costs (likely over a grand) and know better for next time.

Thanks for your replies

AdrianC

jimspark wrote: »

Exchange according to the developer is the date on which the reservation expires, in our case 28 days from the date of reservation. We do not get a say in this as new build buyers.

I think what's happened is that you're a bit confused about the various stages of the journey between deciding you like somewhere and actually owning it.

1. Reservation is akin to merely having an offer accepted on any other property, and it be taken off the market by the vendor. You haven't bought anything. It's just the start of the due diligence and legals.
2. Exchange is when you legally commit to buy the property, but you haven't bought it yet.
3. Completion is when you actually buy it and get the keys.

It's utterly unreasonable of them to expect you to do all the due diligence within 28 day of reserving the plot and starting on that DD journey. I'd be surprised if they did open the property to the market again if you hadn't exchanged within that period, especially if you were actively pursuing the purchase, rather than simply sitting back and waiting for your previous chain to complete.

Think about it - on day 29, are they really going to flog an exclusive reservation to somebody else, barring you from continuing? Then, when they don't exchange in time either, sack them off and flog another to somebody else? They might pile up the pocket change of the reservation fees, but they'll never actually sell many houses...

It's simply just another part of the vendor's attempts to bully the putative buyer into doing things their way, with the fewest questions asked - same as "recommending" the solicitor...

Fair enough, but why is it okay for us to be left (possibly substantially) out of pocket for this?

Until exchange, either side can back out with zero comeback from the other. You haven't bought anything until then. You never reached that point.

The "reservation" is the developer committing to a 28 day period of exclusivity with you, time for you to do the DD, but no more than that.

...that the developer must inform us of all charges associated with the property ... which they didn't

But they did... That's how you found out about the charges in time to abort the purchase before you committed to it...

Why and how is it the norm for developers to not disclose all of the information on a property (which they will obviously be aware of) before the potential buyer parts with their hard earned?

They did. You haven't paid the vendor anything bar the initial reservation fee.

Your ire really should be pointed at the fact your solicitor was a waste of oxygen. Next time, find a local, recommended solicitor who's independent of the vendor, and ask them about no-sale-no-fee. You'll still be liable for the costs of any searches or other disbursements, but not for their fees.

jimspark

I see where you are coming from but when I'm talking about our financial losses I'm referring to the £150 non refundable deposit, the £300 fees for solicitors searches plus whatever the bill is for the solicitors time spent on the transaction so far, which I'm expecting to be a fair chunk. I do not mean any deposit etc that we may have had we pulled out between exchange and completion.

jimspark

I see where you are coming from but when I'm talking about our financial losses I'm referring to the £150 non refundable deposit, the £300 fees for solicitors searches plus whatever the bill is for the solicitors time spent on the transaction so far, which I'm expecting to be a fair chunk. Losses that we would not have suffered had the developer given us all the facts at reservation, as we would never have reserved. I do not mean any deposit etc that we may have had we pulled out between exchange and completion.

AdrianC

jimspark wrote: »

I see where you are coming from but when I'm talking about our financial losses I'm referring to the £150 non refundable deposit, the £300 fees for solicitors searches plus whatever the bill is for the solicitors time spent on the transaction so far, which I'm expecting to be a fair chunk. I do not mean any deposit etc that we may have had we pulled out between exchange and completion.

Yes, so am I.

jimspark

I understand, thanks for your advice

trex227

Having worked at conveyancing firms that were on builders "panels" the solicitor probably didn't mention the covenants to you as they see the same ones from this builder all the time and theres nothing that would cause an issue with lenders. I would say the majority of clients don't read the information given to them during the conveyancing process and so they've probably not specifically flagged the covenants up to clients as no-one has previously had any issue with them.


The advantage of buying "old" houses is when you decide you are interested in the property before committing to anything you can spend £3 at the Land Registry (assuming its registered) to have a read of the title documents to see if there is anything of any concern.