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James Clow


RockyBalboa
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Don't admit that to a judge. 'Your circumstances have changed', would be better I think.

Look at it, for one minute, from the Developers point of view. They are now aware that this is happening. They surely know that they are going to have to try and force the majority of completions. If the bank would let them off the hook and the orginial land owner would give them the money back, they in turn would allow everyone out and pigs will fly. But here's the point

They have to complete the building because they are contractually obligated to do so via the 100's of legally binding contracts they have with all the purchasers. They cannot stop (unless the bank stops them). Therefore a judge will take the contract as a two way enforceable contract. I cannot see him 'setting it aside' as that would set a precedent that would render any contract in the future not worth the paper it is wrote on.

However this leaves the old adage 'you can't get blood from stone' and that will work if you have no assists(car, home, savings, future inheritance, etc.) or income above the minimum wage. If you have a good job with 'disposable income' well -that will do nicely thank you.

Remember it wont be the developer who will be seeking this. It will be his lender, the bank in the background. They have all been bailed out and now know they are untouchable. Like all money lenders they want it back.

If you are in this situation get independent legal advice right away (not just the Solicitor you used to enter the contract). Don't bury your head in the sand. This is not America where you post the keys back (Jingle mail) the law is different here.

Some developers/lenders are going to discover what 'Specific performance' really means (£80 per month)

However some investors will also discover the consequences of not fulfilling their legal promises.

Don't suppose you know where to find a good solicitor..I have made enquiries at a large Belfast solicitors but got the feeling that they were batting for the developers team. I was told that should I not be able to complete I would be taken to court and forced (?how) to pay the full cost of the flat plus the litigation costs.

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Don't suppose you know where to find a good solicitor..I have made enquiries at a large Belfast solicitors but got the feeling that they were batting for the developers team. I was told that should I not be able to complete I would be taken to court and forced (?how) to pay the full cost of the flat plus the litigation costs.

I have no doubt that will be the outcome of the court, however this may be a hollow victory is the means is not there to do so. But the obligation will remain.

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I have no doubt that will be the outcome of the court, however this may be a hollow victory is the means is not there to do so. But the obligation will remain.

Do you know of cases where this was the outcome? To date I have only heard of cases where it was considered that 10% deposit was a big enough penalty for those that don't complete.

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Do you know of cases where this was the outcome? To date I have only heard of cases where it was considered that 10% deposit was a big enough penalty for those that don't complete.

That is true as to date the 10% deposit was enough to cover the reduction in sales value(if any) or losses that the developer suffered as a result of the default in the contract. Things are different now.

I am not aware of any of the recent cases running yet. I could see the developers running a few test cases first.

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Do you know of cases where this was the outcome? To date I have only heard of cases where it was considered that 10% deposit was a big enough penalty for those that don't complete.

Except that a 10% penalty would likely be nearly enough to enable the developers to get their money back. If it came down to it the chances are that the buyers would be forced to pay the difference between the contract price and the present market value (plus all legal and admin costs). So it seems likely that will be more like 40% plus or upwards of 100k. If the buyers had assets these would likely have to be sold and any shortfall paid off over a longer time. In practice this means anyone with a home would have a real risk of losing it. Everyone else will just be paying it off for the rest of their lives. Welcome to the joys of debt.

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Don't admit that to a judge. 'Your circumstances have changed', would be better I think.

Look at it, for one minute, from the Developers point of view. They are now aware that this is happening. They surely know that they are going to have to try and force the majority of completions. If the bank would let them off the hook and the orginial land owner would give them the money back, they in turn would allow everyone out and pigs will fly. But here's the point

They have to complete the building because they are contractually obligated to do so via the 100's of legally binding contracts they have with all the purchasers. They cannot stop (unless the bank stops them). Therefore a judge will take the contract as a two way enforceable contract. I cannot see him 'setting it aside' as that would set a precedent that would render any contract in the future not worth the paper it is wrote on.

However this leaves the old adage 'you can't get blood from stone' and that will work if you have no assists(car, home, savings, future inheritance, etc.) or income above the minimum wage. If you have a good job with 'disposable income' well -that will do nicely thank you.

Remember it wont be the developer who will be seeking this. It will be his lender, the bank in the background. They have all been bailed out and now know they are untouchable. Like all money lenders they want it back.

If you are in this situation get independent legal advice right away (not just the Solicitor you used to enter the contract). Don't bury your head in the sand. This is not America where you post the keys back (Jingle mail) the law is different here.

Some developers/lenders are going to discover what 'Specific performance' really means (£80 per month)

However some investors will also discover the consequences of not fulfilling their legal promises.

have to disagree VI

yes they can bury their head in the sand

only dont do it here

cash up you assets and head for a beach in north cyprus or similar for a few years!

the shylocks might just then deduce you are not worth chasing for their £ of flesh!

as for the legal eagles dont expect much

if you cannot afford to complete on a flat

you cannot afford a large legal bill either!

an old country solictor was known to remark

" a thin goose dont do much to feather my nest!"

it dont say it in the small print

but signing on the dotted line can be like dancing with the devil!

anybody remember Cozy?

ah the days before drum machines

http://www.youtube.com/watch?v=erJc4dzZ3IA

rock on!

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Rocky, I have read your post on the main forum. Few of the people here venture onto main forum as it is not a very friendly place. Please ignore some of the a$$holes that replied to your post.

I know what you were trying to do. There are some very knowledgeable people who post on the main forum. However, if you want to try that again may I suggest that you try the Anecdotals forum. There are some even more knowledgeable people who only post in there. You may get better advice and less abuse. Especially if you are truly a naive first-time buyer.

You don't sound like a property investor to me. If you truely are a naive first-time buyer then I would imagine, if it goes to court, that a judge would be sympathetic. Please don't be offened by what I am about to say, but you would have to plead stupidity. There may even be a case for extortionate pricing by the developers. IIRC an apartment costs in the region of £50k to build (excluding land value).

Good luck,

BB

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Rocky

Another place you could try is the Motley Fool legal discussion board.

http://boards.fool.co.uk/Messages.asp?bid=51110

Thanks Belfastboy and doccyboy and sophia for your words of support!

I only went on there as I had seen a forum on moneysavingexpert where people from England and Wales were dicussing being unable to complete on newbuilds. I simply thought there may be someone who had already been taken to court or something who might be able to advise. Never Again!!!!! Really did not expert a torrent of abuse!

And doccyboy definitely not offended by what you said (and besides am very thick skinned after my experience on the main forum). . I am a first time buyer and it is my own stupidity/wishful thinking/inexperience that has gotted me into this mess. I simply really wanted to buy somewhere to live in and at the time I kept getting out bid (In early 2007 I was looking at flats priced at 160k which were going into bidding wars..some went over from 160k to over 250k!!)..this seemed to be the only way I could do it. A very expensive lesson learned.

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There really are some prats on the main forum (unfortunately some come here on occasion as well). Whilst it is clear that I think you made a really dumb decision, your clear acceptance that this is true earns you respect in my book - so I hope you do not mind my rude response to one particular contributor on that thread.

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You don't sound like a property investor to me. If you truely are a naive first-time buyer then I would imagine, if it goes to court, that a judge would be sympathetic. Please don't be offened by what I am about to say, but you would have to plead stupidity.

Rocky if you are a "naive first-time buyer" then you have my sympathy and my hopes that you will find a satisfactory way out of this difficulty. Whatever happens aim for a speedy resolution, draw a line under it and move on. Seek your own legal advice - your circumstances won't be the same as the undoubtedly large number of speculators who share your predicament. You have more to be hopeful about as you may gain the courts favour - they should have known the risks.

To me the whole thing looks a bit like a spread bet or a punt on the future markets - a very dangerous game!. Flat (sorry - apartment) buyers fixed a price in the future in the hope of unlimited gains; unfortunately forgetting the prospect of unlimited losses if prices went the other way. Let's face it - you did expect the valuation was going to be greater on completion than what you were going to have to pay for it, didn't you? Unfortunately you now know this won't be the case.

Never gamble and certainly never gamble with money you don't have - but you know this now as well.

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Can anyone translate this for me.

Part b says that the developer can keep the deposit if I don't complete- i get that.

I can't get my head around part a..what are they saying?

Also could james clow people check if their contract says the same.

Rescission

If by the completion date the developer has completed the apartment in accordance with this agreement and the sale is not completed on the said completion date the developer may on said date or at any time thereafter give to the employer notice in writing to complete this transaction. Upon service of an effective notice pursuant to this clause it shall be an express term of this agreement that the employer shall complete the transaction within 5 working days after the service of the notice and in respect of such period time shall be of the essence. If the employer does not comply with the terms of an effective notice served by the developer under this clause then the developer may rescind this agreement and:

a)the employer shall forthwith on the expiry of that notice, or within such further period as the developer may allow, return all papers in his possession belonging to the developer and at his own expense (subject to the right of any legal mortgagee) execute a proper surrender, reassignment or reconveyance as the case may be to the developer of the site upon which the dwelling is situate; and

b)without prejudice to any other rights or remedies available to him at law or in equity the developer may forfeit and retain for his own benefit the deposit pay by the employer pursuant to clause 9 above.

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yes mine says exacly the same thing cant get my head round it either

Can anyone translate this for me.

Part b says that the developer can keep the deposit if I don't complete- i get that.

I can't get my head around part a..what are they saying?

Also could james clow people check if their contract says the same.

Rescission

If by the completion date the developer has completed the apartment in accordance with this agreement and the sale is not completed on the said completion date the developer may on said date or at any time thereafter give to the employer notice in writing to complete this transaction. Upon service of an effective notice pursuant to this clause it shall be an express term of this agreement that the employer shall complete the transaction within 5 working days after the service of the notice and in respect of such period time shall be of the essence. If the employer does not comply with the terms of an effective notice served by the developer under this clause then the developer may rescind this agreement and:

a)the employer shall forthwith on the expiry of that notice, or within such further period as the developer may allow, return all papers in his possession belonging to the developer and at his own expense (subject to the right of any legal mortgagee) execute a proper surrender, reassignment or reconveyance as the case may be to the developer of the site upon which the dwelling is situate; and

b)without prejudice to any other rights or remedies available to him at law or in equity the developer may forfeit and retain for his own benefit the deposit pay by the employer pursuant to clause 9 above.

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yes mine says exacly the same thing cant get my head round it either

Folks you need to individually seek your own legal advice - preferably with a very good solicitor with experience in property law. The sooner the better. Sadly you seem to have signed these contract without understanding what they said.

Part (a) seems to me simply to require that you return any papers, presumably the deeds etc., that would have been sent to your solicitor for conveyancing and inspection prior to completion.

The bit you might need to worry about is the first part of b: "without prejudice to any other rights or remedies available to him at law or in equity" - You need to see if the developer can use this to sue you for damages for the loss in value of the apartment. It isn't necessarily obvious that he can. Is there anything else in the contract that explicitly states the developer can claim anything more than the deposit if you don't complete? Don't forget they probably weren't expecting to be completing in the middle of a property crash either.

And for goodness sake - get your heads out of the sand and get professional legal advice! Nothing you read on this or any other site will be a substitute for getting a solicitor to handle this matter for you.

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I agree, I feel though there should be much more onus, and perhaps a legal duty placed on solicitor processing contract to fully explain all it's points, rather than perhaps just a brief overview so purchasers are in no doubt about the contract terms - esp given both potential ramification and also the likely conveyancing fee charged. This is especialy so in apartments where on completion purchasers are signing a lease to become a shareholder in a limited company also, being the Management Company pertaining to the apartment block. This raises a whole set of issues in itself, and needs to be gone through in detail to be clear about the legal setup re constitution, articles of association, finances, voting setup, and rights and obligations under the lease. I have stated some of the issues elsewhere. As you rightly state many sign without having understood what they are contracting into, however I wonder how many conveyancing solicitors really ensure their client fully understands all points and any potential ramifications, no doubt some do, but obviously others don't as seen here. I also feel that esp during boom, investors and o/o's were purchasing with little consideration for what the contract entailed. How long did solicitors appointments last when dealing with the siging of the purchase contract and how much detailed explaination of contract took place - or questioning of it by the purchaser...? I have come accross apartment owners who bought apartments and didn't even know about the existence of a Management Company and the implications of them being shareholders - esp if Management Company were to go bust due to owners refusing to pay management charge. Unfortunatly some investors especially try and delay/withhold management charges putting both facilities and financial stability of block in trouble. While legal action can be undertaken under the lease terms to recover debts, it can take time and meanwhile the funds are not there to be able to budget/pay for facilities.

Your comments are spot on! Another symptom of the "bubble" - when otherwise sane people were prepared to sign away hundreds of thousands of pounds without even understanding the terms of the contracts. I was often amazed, during those daft times, how some people used a set of financial values when it came to property which was completely at odds with their attitudes to money in anything else.

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as far as i am aware co- ownership was done away with as soon as this financial crisis carryon started

Mayb i'll wait for the new release...i'm hoping to buy a house through co-ownership i think their maximin is £175,000 and the max i can get a mortage is about £150,000...so it will depend on the revised price. I was going to buy in curzon on the ormeau road at a discount but they sold them to the housing exec...

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Mayb i'll wait for the new release...i'm hoping to buy a house through co-ownership i think their maximin is £175,000 and the max i can get a mortage is about £150,000...so it will depend on the revised price. I was going to buy in curzon on the ormeau road at a discount but they sold them to the housing exec...

Out of interest, do you recall the level of discount that you were being offered vis-a-vis the original selling prices at the Curzon development?

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I have purchased 1 of these apartments also on the 1st day of release at a higher price due to the originals apartments eing sold. I have absolutely no chance of obtaining a mortgage as valuation will not come close. Im consulting my solicitor in the coming week however i cannot see this helping, has anybody any suggestions. I am unfortunately a 1st time buyer and was buying to live.

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I have purchased 1 of these apartments also on the 1st day of release at a higher price due to the originals apartments eing sold. I have absolutely no chance of obtaining a mortgage as valuation will not come close. Im consulting my solicitor in the coming week however i cannot see this helping, has anybody any suggestions. I am unfortunately a 1st time buyer and was buying to live.

The solicitor will be able to best advise but others have suggested that going bankrupt is one way which would have a chance of giving you a clean slate....

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