Sold at auction query

[csd]

If a propoerty is sold at auction and the Contract has been signed by the purchasers, are the vendors legally bound by the Contract to the sale (the vendors have not yet executed)? Is there is an "escape clause" for the vendors to pull the sale or not proceed?

 

[Terry_w]

If a propoerty is sold at auction and the Contract has been signed by the purchasers, are the vendors legally bound by the Contract to the sale (the vendors have not yet executed)? Is there is an "escape clause" for the vendors to pull the sale or not proceed?

Generally they would be locked in.

 

[csd]

Thanks. Are there any outside exceptions?

 

[Terry_w]

Thanks. Are there any outside exceptions?

There are always exceptions.

 

[slix_88]

Thanks. Are there any outside exceptions?

I think there are 3 scenarios, only 2 of which I can remember:
- If the vendor suffers from a mental illness and could prove it
- If the vendor perishes or experiences a death in the immediate family

I know this because we won a house at auction 4 years ago and the vendor pulled all the tricks in the book to pull out. She even claimed to be suffering from depression and was receiving counselling, supposedly. We didn't budge and I think she just gave up. If the purchasers are eager, they could fight it out in court which could be a very costly imposition on both parties involved.

 

[Terry_w]

Depends on the terms of the contract.

3rd one would be bankruptcy.

In new the standard contract doesn't include these provisions but they are frequently included in special conditions

 

[Propertunity]

If a property is sold at auction and the Contract has been signed by the purchasers, are the vendors legally bound by the Contract to the sale (the vendors have not yet executed)? Is there is an "escape clause" for the vendors to pull the sale or not proceed?

I assume you mean that the vendors have not yet signed, on the fall of the hammer? In which case,
they don't need an "escape clause" as there is no contract yet formed.

HOWEVER, in most states (not sure in SA), the auctioneer has Power of Attorney for both buyer and seller (vendor). So, the auctioneer could sign on behalf of the vendor, and the vendors would be committed.