Developers pull out before exchange of contracts. Is the reservation fee and extras paid refundable

Thrugelmir

Why weren't you able to exchange contracts?  Completion date of the property can be covered by a long stop clause. New builds are often subject to delays. Materials, weather, availability of sub contractors etc. 

With no exchange there's no incentive to priortise work on the build. 

Marvel1

SBretherton91 said:

No, we were recommended the solicitors by Optimus Move. We now know in future to instruct the developers recommended solicitors. It's been an absolute nightmare these past 8 months.
We weren't given a reason as to why the developers delayed completion of the house. We assumed it must have been because of Covid.
The property has now been increased by £8,000.

Never use recommended services from sellers.

HampshireH

What did Beaumont actually do to cause the delay?

Were they waiting on enquiries from the developers as if so that's not your solicitors fault that's the developers.

If you have genuine grounds for complaint against the solicitor you can put your complaint to then seeking reimbursement of your costs.

When I used Beaumont Legal I couldn't fault them. The portal was very transparent with checklists of what was completed and what was outstanding plus dates when received and updates handled via their chat and/or email system.

I appreciate your experience has been different.

Specifically what caused them not to exchange on time?

TBG01

We wanted to exchange contracts. We were constantly on the phone to our solicitors trying to push them to exchange but everytime we thought we were getting somewhere they required something from sellers solicitors

Clients don't get to dictate that they want want to exchange when they're not in a position to do so. Would you have been happy with them exchanging and it turns out you don't own the garden? Or there's something on the title that makes it near impossible to sell in the future?

 If you search reviews on Beaumont Legal, you'll understand how bad they are.

And for every bad review left, there's a client that who was perfectly happy with the service but doesn't leave a review.

SBretherton91

We instructed Beaumont Legal on 21st January. We were informed the turnaround to exchange contracts would be 10 weeks. When it went past the 10 week deadline, we didnt question it as we assumed it was down to the pandemic. We were contacted by the developers to find out when contracts were to be exchanged, we contacted BL to find out where we were at with the purchase and they hadnt even started the process. Only then did they begin searches and enquiries, this was in May.

Each time we rang BL which was on a weekly basis, they told us they were waiting on sellers sols for enquiries which we understood, however the developers sols said there was nothing outstanding on their side. 

Once enquiries were finalised, it then came to light that the CML from the developers was incorrect as they hadnt included an incentive which further delayed the process. The amended CML was then passed to our lenders to confirm, this took another few weeks of constantly ringing our solicitors and each time we were told they were still waiting for our lenders to confirm the CML with incentive was good to go ahead. Our mortgage was due to expire at the end of July (completion date) but we managed to extend this for another month. Our solicitors told us they didnt receive proof of the extension from our lenders even though our mortgage broker sent them proof via email, so for BL it appeared we didnt have a valid mortgage offer. By then we were constantly ringing BL to find out what was taking so long. By the final week of august, we were contacted by our mortgage broker to ask if we wanted to extend our mortgage but to do so we would need to exchange contracts, but our sols would only exchange contracta on the basis we had a valid mortgage offer which they didnt have proof of. We were going round in circles and then unfortunately our extended mprtgage offer expired at the end of August. We were then notified by our mortgage broker that to extend it even further, they would require payslips and a valuation of the house. When we told our developers of this, they told us they were pulling out. We were so close to completing.

Anyway, our developers has had £3411 from us for extras and res fee and they have put the house back on the market for 8K more. My whole point of my original post was to find out if we could get any of this money back?

in regards to BL we soon found out that they had taken too many cases on and all solicitors were snowed under. We had 3 case handlers throughout and none were helpful.

I do believe they were a good firm a while back but it appears they arent anymore.

Irishpearce26

From what you've said technically the sale failed as you and your solicitors failed to exchange as per the T&Cs of the reservation. I think you've lost the reservation fee but however unless stated in the T&Cs about the extras you may get that back Although I wouldn't be surprised if there was a section regarding extras and failing to exchange on your end.

The increase of £8k will be market rise plus the rise in materials due to covid and brexit.

Thrugelmir

SBretherton91 said:

we contacted BL to find out where we were at with the purchase and they hadnt even started the process. 

What happened between the 21st January and the temporary shut down caused by the pandemic. That's two months wasted. Where exchange could have been effected. Or at least been in a position to conclude once people returned to work. 

MalMonroe

This is awful. I feel so sorry for you. To lose not just the house but also your money is just beyond belief. Your solicitors have behaved totally and utterly irresponsibly. Please don't let them get away with such incompetence. And please don't pay any bill they may have the bare-faced cheek to present to you.

Instead, please write to them advising that you intend to make an official complaint because as a direct result of their incompetence not only have you lost your dream house but you have also incurred unnecessary expense. List their shortcomings. Also list your losses and make it clear to them that you will be claiming the cost of your losses from them.

Please see the information in this link -

https://www.lawsociety.org.uk/en/public/for-public-visitors/using-a-solicitor/complain-about-a-solicitor

You have been treated abominably and your solicitor, knowing that you were first time buyers and therefore inexperienced in house buying, should have made extra special efforts to ensure that things ran smoothly. Sadly, it appears that they did nothing.

It isn't your fault though so don't blame yourselves. Some solicitors are just rubbish and you have to know when to tell them that you've had enough and you have to let them go and find someone else. I've done that in the past. When it came to my divorce, I ended up having to have three lots of solicitors - but none of them were particularly good at what they did. Yet solicitors get paid great wads of cash!

Don't let these solicitors get away with what they have done to you. It isn't something they should be allowed to walk away from. To me, it's a very serious matter - they've dragged their heels and by doing so they've actually changed the course of your lives. For a start they've decided where you are not going to live - and that's a pretty big deal. 

Flugelhorn

Suspect this was much to do with rising prices, in "normal" times the developers would have kept goading and chivvying the purchasers to get a move on  as they knew that to get another purchaser (at probably the same sale price) would cost them money and time - they are just making money out of the rising market. Unfortunately extras usually get lost to the purchaser if completion doesn't take place for whatever reason

AdrianC

Flugelhorn said:

Suspect this was much to do with rising prices, in "normal" times the developers would have kept goading and chivvying the purchasers to get a move on  as they knew that to get another purchaser (at probably the same sale price) would cost them money and time - they are just making money out of the rising market. Unfortunately extras usually get lost to the purchaser if completion doesn't take place for whatever reason

That's the reason the developers have followed the letter of the reservation, rather than giving leeway.

But, ultimately, the OP is the one who's brought this to the point where they can, by failing to follow the contract and exchange in time.

Whether the delay is due to the OP or the OP's solicitor is beside the point, so far as the vendor is concerned. The reservation has been breached from the OP's side, allowing the vendor to walk away without penalty.