Auction property nightmare

Geoff9999

Me and my partner have got ourselves in a really stressful situation.

We’ve bid on an auction property and put down a deposit and paid the auctioneers fee.

Now we’re at the stage of trying to complete and all sorts of things have come to light.

The management company of the flats have been sent to prison for intimidation and violence etc.  

So currently there’s no management company and we believe that the criminals are probably the freeholders.

What would people do at this point? What questions are there to ask and to whom?

Any help hugely appreciated

Devongardener

What do your solicitors advise?  You can find out who owns the freehold from Land Registry,  I would have thought that your solicitor would have already done that if you are nearer completion.  What does the sale agreement say?

boongywoongy

Are you using a specialist conveyancer that handles auction transactions? If so, what is their opinion about completing without a review of a management pack? Is there anything in the auction legal pack with the necessary details to get out of it? If I recall correctly though, you've already exchanged contracts by now and after you complete, if you really no longer want to hold it, you could consider auctioning it for sale to exit. Seems like there was a reason that the property appeared at auction in the first place.

kazwookie

Geoff9999 said:

Me and my partner have got ourselves in a really stressful situation.

We’ve bid on an auction property and put down a deposit and paid the auctioneers fee.

Now we’re at the stage of trying to complete and all sorts of things have come to light.

The management company of the flats have been sent to prison for intimidation and violence etc.  

So currently there’s no management company and we believe that the criminals are probably the freeholders.

What would people do at this point? What questions are there to ask and to whom?

Any help hugely appreciated

I have a feeling once you have bid at an auction, that it is you have to proceed with the purchase and within, (x) number of days.

I suggest you contact your solicitors and explain to them what is going on, and ask their legal advise.  If you are using the auction house's in house legal team, ring round solicitors in your area and get independant advise.

anselld

Geoff9999 said:

Me and my partner have got ourselves in a really stressful situation.

We’ve bid on an auction property and put down a deposit and paid the auctioneers fee.

Now we’re at the stage of trying to complete and all sorts of things have come to light.

The management company of the flats have been sent to prison for intimidation and violence etc.  

So currently there’s no management company and we believe that the criminals are probably the freeholders.

What would people do at this point? What questions are there to ask and to whom?

Any help hugely appreciated

That seems a little over-dramatic.   A management company cannot be sent to prison for starters.

What do you actually know for a fact and where has the information come from?

Absence of a managment company should have been apparent prior to the auction in the legal pack and that is not necessarily a problem.

km1500

normally when you exchange contracts after an auction and put a deposit down then there is no way to get out of the purchase unless there is a defect in the title

SDLT_Geek

Geoff9999 said:

Me and my partner have got ourselves in a really stressful situation.

We’ve bid on an auction property and put down a deposit and paid the auctioneers fee.

Now we’re at the stage of trying to complete and all sorts of things have come to light.

The management company of the flats have been sent to prison for intimidation and violence etc.  

So currently there’s no management company and we believe that the criminals are probably the freeholders.

What would people do at this point? What questions are there to ask and to whom?

Any help hugely appreciated

This does sound like a "traditional auction" where a contract is formed on the fall of the hammer with a relatively short period, usually about 4 weeks, to complete.

Just to be sure though, this was not one of the dreaded "modern method of auction" sales where you paid a fee to get the benefit of what is really a reservation agreement giving you about 56 days to exchange and complete?

propertyrental

If this was a traditional auction, surely this would have been highlighted by your solicitor before the auction? You did employ a solicitor to check the Legal Pack etc before bidding yes?

If this was a so-called Modern Method auction, usually to be avoided, have you Exchanged Contrcts? If yes, again, your solicitor should have spotted this before allowing you to Exchange.

A company (eg management company) cannot 'go to prison', though its Directors could. Have you checked if the named Freeholders of the building are the same 'criminals' as the (Directors?) management company?

If different people/companies I imagine the freeholder will appoint a new Manco.

An alternative longer term could be for the leaseholders to band together and manage the building themselves (Righ To Manage).

NameUnavailable

From the OP it sounds like 'modern method of aution' to me?

Was it? Have you actually exchanged contracts yet? If you haven't you can walk away but you do lose the deposit which isn't really a deposit but just a fee for the EA or 'auction' company.

As said a company can't be sent to prison. If you mean the freeholder has been sent to prison then you can possibly get together with the other leaseholders to buy the freehold or obtain right to manage (if you are committed to the purchase).

Geoff9999

So to clarify below is the link to the people who managed the flats and and also own the freehold.

https://www.kentonline.co.uk/thanet/news/amp/landlords-from-hell-who-left-tenants-absolutely-petrified-275021/

The freehold is owned in a foreign trust so perhaps that makes it harder to force them to sell it or have the usual transparency.

the auction was through pattinsons and we have paid their £6000 fee and £2000 deposit.
Our solicitor is generally rubbish but did say that the auction legal pack said that there was a tenant in situ but it hasn’t (which we never thought it had) but could that technicality be a reason to say it wasn’t accurate and get our deposit back?

RAS

Geoff9999 said:

The freehold is owned in a foreign trust so perhaps that makes it harder to force them to sell it or have the usual transparency.

the auction was through pattinsons and we have paid their £6000 fee and £2000 deposit.

Sounds like it's being sold under a Modern Method of Auction,

The basic rule is to avoid these like the plague and it may be wise to avoid any agency that promotes them.

Even if you want the property, there is no guarantee the required documentation needed to complete by the deadline will be provided so potential buyers lose their money.