forfeit of deposit???

M

melbourne

Dear all,
we are about to settle in 2 weeks and our contract specifies that "vacant possession" is to be given. however, tenants are in there which were signed up after a month of us signing the contract as "vacant possession". We weren't made aware of this until a text essage 3 weeks later.

the tenants will be in there until the 8 May so the real estate agent asked us to settle later. We said no on several occasions.

our conveyancer said that its unlikely the property will be empty because they havent been given the required 60 days.

We thought of pulling out of the contract but i believe the deposit will be lost? Is this true?
 
Because the vendor has breached the terms of the agreement, the deposit will have to be returned to you if you rescind (tear up) the contract. You are not at fault.
 
Welcome!

What did your conveyancer say?

Id say (I am not a solicitor mind you) that they have not stuck to the terms of the contract and should therefore reimburse the deposit you paid. you might also have grounds to sue for breach of contract for any other costs involved.

Whats thte big deal about settling a bit later? If you have to stay in a hotel and put your stuff in storage, you might be able to negotiate the vendor to pay these costs?
 
tobe said:
Welcome!

What did your conveyancer say?

Id say (I am not a solicitor mind you) that they have not stuck to the terms of the contract and should therefore reimburse the deposit you paid. you might also have grounds to sue for breach of contract for any other costs involved.

Whats thte big deal about settling a bit later? If you have to stay in a hotel and put your stuff in storage, you might be able to negotiate the vendor to pay these costs?
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it doesnt matter if we are settling later, our house is on the market so any extra time would be better.

Now, when it comes to compensation, what's usually a fee that can be asked?
 
If it doesnt matter, why are you worried??? are you just having cold feet? is there another reason you dont want to settle on this property?

I didnt say compensation, I said actual costs. If its not costing you extra for the delay in settlement, you'll find it dificult to negotiate a price reduction.
 
melbourne said:
...Now, when it comes to compensation, what's usually a fee that can be asked?
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That is written into the contract - have a read.

I know you are in Vic, but if this was NSW, all the purchaser can do is issue a "14 day notice to complete" to the vendor. There are almost no penalties on the vendor at all. However, if the purchaser is late to settle, then there are all sorts of fees and IR penalties.:rolleyes:
 
thing is: when you have plans about a new house you buy and you've spent money on getting a solicitor's opinion on this all situation, of course we're pissed off! Its not fair, the real estate agent messed up BIG TIME and they should be paying a compensation. Im sure that they'd be asking us for money if the situation was inverted.
 
so ask your soliciotr to work pro bono for you to recover some costs, or compensation for you enough to cover their costs.
 
tobe said:
so ask your soliciotr to work pro bono for you to recover some costs, or compensation for you enough to cover their costs.
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i tried to talk to him about it, can't never get in touch. After calling him about 10 times to try talk to him and this invoice he sent me, the receptionist said the following (this ornig infact) "Charles is not interested in talking to you: he said, if you are not happy with the invoice you received, take it up with the appropriate body which are on the reverse of your invoice"

so im onto VCAT now
 
You might find the costs to pursue this outwiegh the likely reward.

Its a shame you have to settle late, perhaps its an omen there is something good coming your way shortly. Perhaps yourll get an offer on your place to settle prior to the 8th May?
 
Anytime there are delays, you will be charged for them, if the solictor is involved.

Unfortunatley, that is a cost of property.
Next time write it into the contract if the vendor delays, they are penalised, $$$ a day.
 
melbourne said:
i tried to talk to him about it, can't never get in touch. After calling him about 10 times to try talk to him and this invoice he sent me, the receptionist said the following (this ornig infact) "Charles is not interested in talking to you: he said, if you are not happy with the invoice you received, take it up with the appropriate body which are on the reverse of your invoice"

so im onto VCAT now
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wow...what a douche.
 
If i was you i would not cancel or rescind the contract prior to the original settlement date. You would also be unlikely to be entitled to any compensation as yet as the breach of the contract has actually not occurred yet. If you do you cancel the contract you will likely find the vendor will turn around and say, "actually i was good to settle, and now you can forfeit your deposit" etc.

The best thing to do is proceed to the settlement date, complain that no vacant possession was provided, and then issue the notice to complete (at least this is what you would do in NSW). You have to follow the letter of the law to ensure that you are not the one held up as being wrong.

Best to follow procedure as it may be that the tenant will not vacate in May, and you may be months out of pocket. If you have followed the right procedures you at least will be protected as much as possible.
 
melbourne said:
im stressed about it because i want to get money off them to at least pay the solicitors fees.
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Are you paying extra to the solicitor to manage the situation? I think as someone else mentioned you can claim additional expenses, rather than costs that you would have already been charged for.

In terms of how you manage it, if you want vacant possession, then I would delay the settlement, rather than settle with a tenant in place.

As someone else mentioned, I would avoid making this a bigger situation than it is.. legal action and fighting with your solicitor etc.... it sounds like its turning a challenge into a disaster...
 
If your not in a rush to move in I would just ensure that the rent from the tenant is redirected you as soon as settlement occurs and wait it out.
 
tobe said:
so ask your soliciotr to work pro bono for you to recover some costs, or compensation for you enough to cover their costs.
Click to expand...

Why would his solicitor want to work for free? It is not the solicitor's fault that the vendor has rented the property after exchange.

And, Melbourne, are you using a solicitor or a conveyancer? You say both in your posts.

What sort of extra costs have you incurred because of this? You also say you would prefer to settle later. I can't imagine the extra legal costs involved would amount to much.

Also, what does your contract say about delays and compensation?
 
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