Can you be forced to pay a balance?

born_again

swingaloo said:

I have friends who have put down a £5000 deposit to buy a lodge. There is another £120,000 outstanding and the sale of their house has fallen through. 

They want to pull out of buying the lodge and are aware the deposit is non-refundable. However, are there any circumstances where the seller can hold them to the contract and insist they pay the rest?

Why do they now want to pull out?
Change of mind?

As they can simply put their house back on the market.

Perhaps some more info on just the purchase is. So is this a lodge on a site they are going to live on etc?

swingaloo

Thanks for the replies. 


They dont actually have a contract as such, just as Sales invoice, payment schedule and a list if site rules.

This is a case of them going in gung-ho with the dream of selling their house and moving into a lodge to retire.  They really fall for the salesman technique and despite me saying think it through before you make a hasty decision they put a deposit down at the first visit. Of course they has to do so as 'This one wont still be on the market next week;.

Of course they have fallen for the 'of course you can live here all year round' when the site is a Holiday park and not residential.   

I did loads of research about the park where they were due to buy, got horror stories from other owners and found the 'Holiday Park Action Group' which is full of stories about people who have lost life savings chasing the dream which turns to a nightmare once they have your money.

They finally listened before handing over the balance which was to come from the sale of the house. The house sale has now fallen through but is still on the market but now they just want to find another house rather than risk losing their money. They have been stalling the park salesman saying the sale is taking a lot longer than they had anticipated but have not yet told him they do not wish to go ahead and buy.

They are going to have to tell him and I have advised sooner rather than later as the longer they stall the more irate the guy could be but they are hoping he will get fed up of waiting and tell them he has another buyer for the lodge. As there are several lodges for sale on the site that is hardly going to happen!

Olinda99

a sales invoice, payment schedule etc IS a contract

you need to post the terms and conditions of that sales contract here before you can get any meaningful response

eskbanker

swingaloo said:

they are hoping he will get fed up of waiting and tell them he has another buyer for the lodge. As there are several lodges for sale on the site that is hardly going to happen!

They obviously well and truly fell for his line about "This one wont still be on the market next week" but he's not going to be seeking a buyer for it as it's already sold as far as he's concerned!

the_lunatic_is_in_my_head

Hello OP

Standard position under contract law is the party suffering the breach can claim costs or loss or profits but not both.

These should be mitigated (lessened) so for example if they find another buyer for £120k they’d claim the costs of some admin, etc wasted on your sale.

The CRA doesn’t apply to new build houses due to the way contracts are structured, they might need professional advice as to whether it does for the sale of a park lodge*.

If it does terms which may be regarded as unfair may offer some protection against them retaining too much from the deposit or seeking excessive costs.

Really they should but the bullet and advise they don’t want to buy and then you can seek advice on this thread as to what they should do next depending upon what the reaction is  

*ETA This document (published Dec 2023) 

https://researchbriefings.files.parliament.uk/documents/CBP-8505/CBP-8505.pdf

suggests the CRA does protect consumer's purchasing a lodge home against unfair terms (and everything else it usually covers), it also goes on to say there is protection under The Consumer Protection from Unfair Trading Regulations and the Misrepresentation Act 1967.

The document mentions the matter of purchasers being told they can live there all year round and if your friends could prove that was said this would likely give them a right to unwind the contract and get their full deposit back. 

If it was verbal I'd be tempted to email, message, etc to see if they'll foolishly confirm it in writing. I don't know where the law stands with recording conversations but if it's legal calling and asking about whilst recording the call would give good evidence. 

Wonka_2

eskbanker said:

Could the company pursue them for the debt in court?  Yes.

Is that the same as being forced to pay?  Not really, but failing to comply with court orders can get messy....

Some of the site owners aren't necessarily fans of court and take a more 'direct' approach 

Given the OP has discovered the HPAG site it's clear they know what they're in for and hopefully the site involved is owned by one of the more legitimate operations and an agreement can be reached

swingaloo

Wonka_2 said:

eskbanker said:

Could the company pursue them for the debt in court?  Yes.

Is that the same as being forced to pay?  Not really, but failing to comply with court orders can get messy....

Some of the site owners aren't necessarily fans of court and take a more 'direct' approach 

Given the OP has discovered the HPAG site it's clear they know what they're in for and hopefully the site involved is owned by one of the more legitimate operations and an agreement can be reached

I discovered the HPAG site the day they went to look at the lodge and rang them to say please dont hand over any money before reading but they bought into the dream retirement lifestyle. 

I also researched the owners and they are definitely the 'direct' approach types.