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    • ibuythings
    • By ibuythings 15th Apr 19, 9:47 AM
    • 13Posts
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    ibuythings
    Please Help -Developer failed to refund the Premium paid to off-plan home
    • #1
    • 15th Apr 19, 9:47 AM
    Please Help -Developer failed to refund the Premium paid to off-plan home 15th Apr 19 at 9:47 AM
    I bought an off-plan property howeverPractical Completion did not take place on the long stop date, according to the agreement, I am eligible to terminate the agreement and receive the premium (two installments) already paid. The Notice to terminate the Agreement had been sent to developer solicitor in January followed by a 2nd Notice 20 days later. However, my solicitor said the developer solicitor alleged the Termination of Agreement is invalid and contested, by sending the Notices I have breached the terms of Agreement for Sale. The deadline to return the payment had expired and developer solicitor had no response to that.

    My solicitor said they will pass the case to their Litigation Dept. with a view to Court Proceedings now being issued to recover the full payment of the deposits.

    Does it mean the case would submit to court? what can I do to receive back the premium?

    BTW, My solicitor does not seems to act on my interest as well, at first they said no refund on SDLT if Agreement is terminated, and then took two months to tell me to log a TR1 form to HMRC for refund. Is that true?

    Please help!
Page 1
    • davidmcn
    • By davidmcn 15th Apr 19, 9:50 AM
    • 10,915 Posts
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    davidmcn
    • #2
    • 15th Apr 19, 9:50 AM
    • #2
    • 15th Apr 19, 9:50 AM
    https://forums.moneysavingexpert.com/showthread.php?t=5940983

    You've posted about this before, and it sounded like your contract is either quite unusual or you've misunderstood it. It's difficult for us to advise without seeing what you've already agreed to. As we explained before, you don't pay SDLT until completion, but the reference to a TR1 suggests you have already completed a purchase? So is this about instalments payable after completion?

    If you don't understand what's going on, it's probably best that you talk to your solicitor.
    • eddddy
    • By eddddy 15th Apr 19, 10:14 AM
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    eddddy
    • #3
    • 15th Apr 19, 10:14 AM
    • #3
    • 15th Apr 19, 10:14 AM
    I bought an off-plan property howeverPractical Completion did not take place on the long stop date...
    Originally posted by ibuythings
    You use the term "Practical Completion" - presumably because the developer is using that term.

    That tends to be a term used in building project contracts, and not in the sale/purchase of property.
    (See: https://uk.practicallaw.thomsonreuters.com/6-107-7024)

    You really need to get to understand the contract(s) that you have entered into.


    My (sightly wild) guess would be that you've entered into a 'exotic' scheme of 2 or more contracts...
    • One contract to buy a piece of land (or a lease on part of a building) - and this contract has completed
    • Another contract for the developer to build a house on the land, or convert part of the building into a flat

    My solicitor said they will pass the case to their Litigation Dept. with a view to Court Proceedings now being issued to recover the full payment of the deposits.
    Originally posted by ibuythings
    Is the solicitor doing this because you asked them to?

    Or because the solicitor feels you have a good case?

    Unless you have a good case, this could work out very expensive for you.
    Last edited by eddddy; 15-04-2019 at 10:21 AM.
    • stator
    • By stator 15th Apr 19, 10:40 AM
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    stator
    • #4
    • 15th Apr 19, 10:40 AM
    • #4
    • 15th Apr 19, 10:40 AM
    If you instruct the solicitors to take the developer to court, remember you will pay their costs unless costs are awarded against the other side


    If the solicitors think you have a good case, you could always ask them if they are willing to act on a no-win no-fee basis
    Changing the world, one sarcastic comment at a time.
    • ibuythings
    • By ibuythings 15th Apr 19, 5:23 PM
    • 13 Posts
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    ibuythings
    • #5
    • 15th Apr 19, 5:23 PM
    • #5
    • 15th Apr 19, 5:23 PM
    My solicitor did not mention it is a good case, I need to ask them for details.
    Last edited by ibuythings; 15-04-2019 at 5:41 PM.
    • ibuythings
    • By ibuythings 15th Apr 19, 5:37 PM
    • 13 Posts
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    ibuythings
    • #6
    • 15th Apr 19, 5:37 PM
    • #6
    • 15th Apr 19, 5:37 PM

    Is the solicitor doing this because you asked them to?

    Or because the solicitor feels you have a good case?

    Unless you have a good case, this could work out very expensive for you.
    It was my solicitor who suggested to pass the case to their Litigation Dept. for Court proceedings, they did not mention it is a good case, I'm not sure if they are acting on my interest.
    • andyf1980
    • By andyf1980 15th Apr 19, 5:41 PM
    • 728 Posts
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    andyf1980
    • #7
    • 15th Apr 19, 5:41 PM
    • #7
    • 15th Apr 19, 5:41 PM
    There is very little that anyone on here can advise given the very limited facts. You really need to talk to your solicitor about it - that's what you're paying them for.
    • ibuythings
    • By ibuythings 15th Apr 19, 5:42 PM
    • 13 Posts
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    ibuythings
    • #8
    • 15th Apr 19, 5:42 PM
    • #8
    • 15th Apr 19, 5:42 PM

    You've posted about this before, and it sounded like your contract is either quite unusual or you've misunderstood it. It's difficult for us to advise without seeing what you've already agreed to. As we explained before, you don't pay SDLT until completion, but the reference to a TR1 suggests you have already completed a purchase? So is this about instalments payable after completion?

    If you don't understand what's going on, it's probably best that you talk to your solicitor.
    Originally posted by davidmcn
    I posted another thread because the case has become complicated not only on SDLT but also the installments I have paid to the off-plan.

    My solicitor said the structure of the purchase meant upon exchange of the Agreement, I also entered into the Lease, resulting in the payment of stamp duty & Land Registration fee. I cannot request refund on SDLT now because the Agreement has not been rescinded as developer did not accept the Termination and refuse to refund the installments.
    • ibuythings
    • By ibuythings 15th Apr 19, 5:48 PM
    • 13 Posts
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    ibuythings
    • #9
    • 15th Apr 19, 5:48 PM
    • #9
    • 15th Apr 19, 5:48 PM
    There is very little that anyone on here can advise given the very limited facts. You really need to talk to your solicitor about it - that's what you're paying them for.
    Originally posted by andyf1980
    I'm worry my solicitor is not acting on my interest, they are developer's recommended solicitor.
    • andyf1980
    • By andyf1980 15th Apr 19, 7:07 PM
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    andyf1980
    I'm worry my solicitor is not acting on my interest, they are developer's recommended solicitor.
    Originally posted by ibuythings
    Have you decided that you definitely don't want to proceed with the purchase?

    Not sure if you have legal cover on your home insurance? If you do it would be worth trying to get some independent advice. If you genuinely want to pull out of the purchase I'd probably take independent legal advice anyway even if I had to pay for it.
    • davidmcn
    • By davidmcn 15th Apr 19, 7:16 PM
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    davidmcn
    I'm worry my solicitor is not acting on my interest, they are developer's recommended solicitor.
    Originally posted by ibuythings
    Then go and see a different solicitor. We can't advise on e.g. whether your notices to terminate were valid, without seeing the contract.
    • eddddy
    • By eddddy 16th Apr 19, 9:02 AM
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    eddddy
    It sounds like you bought-into some kind of unregulated scheme.

    Did the advertising and documents use terms like 'Investment'?

    And did you use your own solicitor, or a solicitor recommended by (or provided by) the developer or the agent?


    I've seen horrendous examples of property related 'unregulated investment' contracts, sometimes over 100 pages long.

    If an 'investor' had actually read and understood the contract (or taken independent advice), I can't imagine they would have signed it.
    • ibuythings
    • By ibuythings 16th Apr 19, 11:24 AM
    • 13 Posts
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    ibuythings
    It sounds like you bought-into some kind of unregulated scheme.

    Did the advertising and documents use terms like 'Investment'?

    And did you use your own solicitor, or a solicitor recommended by (or provided by) the developer or the agent?

    Originally posted by eddddy
    The off-plan is a redevelopment of an existing property. I entered to a Lease at the beginning when the Agreement was signed, so I guess the purchase completed. Is that right?

    But construction going on with long stop date already expired.

    I don't see the term investment used in the documents. The solicitor is developer recommended.
    • ibuythings
    • By ibuythings 16th Apr 19, 11:29 AM
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    ibuythings
    Then go and see a different solicitor. We can't advise on e.g. whether your notices to terminate were valid, without seeing the contract.
    Originally posted by davidmcn
    Thanks for your advice, the situation is unexpected, I hope to gather more information before making the decision
    • ibuythings
    • By ibuythings 16th Apr 19, 11:41 AM
    • 13 Posts
    • 0 Thanks
    ibuythings
    Have you decided that you definitely don't want to proceed with the purchase?

    Not sure if you have legal cover on your home insurance? If you do it would be worth trying to get some independent advice. If you genuinely want to pull out of the purchase I'd probably take independent legal advice anyway even if I had to pay for it.
    Originally posted by andyf1980
    thanks for your advice, I don't have home insurance covered. I also need the premium back for other use. Do you know any good legal firm experience in similar case?
    • eddddy
    • By eddddy 16th Apr 19, 12:44 PM
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    eddddy
    Sadly, this sounds similar to some other 'cowboy' schemes I've seen.

    They worked like this:
    • A 'cowboy' builder/developer forms a company with no assets
    • The company gets an option to purchase a disused building for conversion into, say, 20 flats
    • The 'cowboy' builder uses a 'cowboy' agent to find 20 'investors' to each buy a lease for a part of the disused building
    • The 'cowboy' builder uses the money from the leases to buy the freehold
    • The 'cowboy' builder takes more money from the 20 'investors' to do the conversion.


    Even if you have a good case, and you win in court, you might find that the company has no assets to pay you.

    You might find that a big chunk of the money you've already paid has gone in commission, fees, salaries and bonuses to people involved in the scheme.

    And, for what it's worth, if you and/or a couple of other 'investors' back out, the scheme may become nonviable, and the company goes bankrupt.
    • ibuythings
    • By ibuythings 17th Apr 19, 11:20 AM
    • 13 Posts
    • 0 Thanks
    ibuythings
    A developer representative contacted me directly yesterday and asked if I would grant an extension of six week period to allow a resale of the unit as they don’t want to involve further litigation fees. And they will return my funds.

    Is this a usual practice for developer to avoid court? or it is a scam? please advise.
    • davidmcn
    • By davidmcn 17th Apr 19, 11:23 AM
    • 10,915 Posts
    • 12,019 Thanks
    davidmcn
    A developer representative contacted me directly yesterday and asked if I would grant an extension of six week period to allow a resale of the unit as they donít want to involve further litigation fees. And they will return my funds.

    Is this a usual practice for developer to avoid court? or it is a scam? please advise.
    Originally posted by ibuythings
    Like I said before, we really don't know enough about what you've got yourself into to advise. The whole thing sounds like a quasi-scam.
    • ibuythings
    • By ibuythings 17th Apr 19, 2:35 PM
    • 13 Posts
    • 0 Thanks
    ibuythings
    Like I said before, we really don't know enough about what you've got yourself into to advise. The whole thing sounds like a quasi-scam.
    Originally posted by davidmcn

    Thanks for your time. I will talk to my solicitor for legal advice then.
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