Purchaser Failed to Complete on Sale

Meridian2uk

My partner sold his house to a developer via an estate agent subject to the builder getting planning permission to develop the property. Planning permission was granted and exchange of contracts took place with completion due at the end of August. After exchange it came to light that there was a covenant in the deeds of the property restricting development of the site. It has been possible (for a price) to get this covenant lifted which has been done. What concerns me is that the purchasers failed to complete at he end of August, they said they were waiting for the covenant to be lifted. I feel we are being taken for a ride. It turns out the purchaser is the estate agents boyfriend, the solicitor my partner used was recommended by the estate agent also. Can we take any action against the purchasers as they have failed to complete (they say they will this week but I’ve heard it all before). They agreed to purchase subject to plan. Perm. which they already had prior to exchange. We live in the south of England and this sale was agreed back in May, surely the property has increased in value whilst we have been waiting perhaps leaving us out of pocket. Any advice appreciated, thank you.

Robert_Sterling_3

What about if the price has dropped?

[Deleted User]

I'm assuming you have a solicitor acting for you already regarding the whole conveyancing thing? He needs to start pressing for completion and asking for compensation for you if completion has gone beyond the date agreed.

Usually when exchange of contracts takes place - a date for completion is agreed - beyond which any delays will mean the person causing the delays will have to pay compensation to the persons delayed.

Mrs_Thrift

Hi,

I think you need to concentrate on chasing up your solicitor, and getting them to sort this out for you, as above.

Like you, I think I'd also be a bit concerned that the Purchaser was the agent's boyfriend, but try not to get personal about it when speaking to the solicitor or agent (hard I know, when all you want to do is shout at them!) Keep smiling, keep being polite, (to their faces anyway!) but firm, and I'm sure your solicitor will get it sorted as soon as possible.

Good Luck.

MarkyMarkD

My partner sold his house to a developer via an estate agent subject to the builder getting planning permission to develop the property.  Planning permission was granted and exchange of contracts took place with completion due at the end of August.  After exchange it came to light that there was a covenant in the deeds of the property restricting development of the site.  It has been possible (for a price) to get this covenant lifted which has been done.  What concerns me is that the  purchasers failed to complete at he end of August, they said they were waiting for the covenant to be lifted.  I feel we are being taken for a ride.  It turns out the purchaser is the estate agents boyfriend, the solicitor my partner used was recommended by the estate agent also.  Can we take any action against the purchasers as they have failed to complete (they say they will this week but I’ve heard it all before). They agreed to purchase subject to plan. Perm. which they already had prior to exchange.  We live in the south of England and this sale was agreed back in May, surely the property has increased in value whilst we have been waiting perhaps leaving us out of pocket.  Any advice appreciated, thank you.

I thought the point of a deposit, payable on exchange of contracts, was to compensate the vendor if the purchase didn't proceed?

Shouldn't you be claiming the deposit from the solicitors and walking away, if you believe prices have risen and they are unfairly faffing you about?

Robert_Sterling_3

The deposit is a gesture of goodwill and intent.
The exchange of contracts is what really matters.

Bossyboots

The contract should have contained a deposit forfeiture clause though.

If a date for completion had been set, you solicitor should have sent out a Notice to Complete immediately he/she became aware completion was not going to take place. Although the sale was subject to the planning permission, as has been pointed out that had been granted. The purchaser's solicitor should have picked up the covenant. Completion should have taken place by now or the deposit forfeited. Tell your solicitor to serve notice to complete. You may be able to gauge from the reaction how entrenched he is with the estate agent/buyer.

It is difficult to be sure but on the face of it, it would seem you may have an action for negligence against your solicitor. With all respect to Mrs. Thrift, I am afraid this estate agent/purchaser/solicitor loop is becoming all to common and often ends in tears. The estate agent may have acted improperly in this transaction. Was the property marketed in accordance with the agreement your partner had with them.

As far as compensation goes, it will depend on how the file has been conducted. You could invoke the firm's complaints procedure. Alternatively, you could seek a second opinion from another firm who will request the file and can check if the work was conducted properly. Sadly, there is nothing to prevent the current solicitors adding or removing things to or from the file before sending it off.

You could contact the Office for the Supervision of Solicitors and make a formal complaint. The Law Society website has details of that.

If you are afraid of things falling through if you complain, you will have to wait until completion has taken place. Keep a record of dates and time of telephone conversations and who you speak to. Once matters have completed and you have paid your bill, the papers become your property and you can ask for the file to be sent to you. I would suggest you do that as soon as matters are finished, as they are entitled to charge for sending you a file they have put into storage.