Advice needed.

You probably have a binding contract if you have gone that far, so the ball is in your court.

I think you have the following options:
a) You can let me off without penalty, or b) let them off with an agreed amount or c) you can insist they settle as per the contract. If they fail to settle you can sue them for breaching the contract. You had better check with your solicitor. Not sure how much you could claim if suing but you should be able to at least claim for all the expenses incurred.

Good luck and let us know what happens please.

Terryw
Discover Home Loans
Parramatta
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It could take a while.

If they fail to settle, I guess you would issue a statement of claim. You have to go to court, fill out some forms, and have them served. They will be notified to attend court. If they don’t attend, you could get a default judgment. If they do attend, then the court officer will ask if you have settled the matter? If no, they may say go outside and talk about it. If not resolved, then they will list the matter to be heard on a future date. This may be another month later. You will be asked how many witnesses will be called etc. I have sued someone, but it never went this far, so not sure what happens next. I think you turn up on the day, and you present your case, and they present theirs. You may then get a decision = a Judgment.

Even if you are able to get a judgment, then you need to enforce it. They may not pay you, so then you have to take further action including applying for the sheriff to go and seize their goods or garnish their wages etc. You can get them into the court and get them to list their assets too – so you know if they can pay and possibly what you can go for. This is called an examination summons.

If the judgment debt is over a certain amount, I think $2000, you can apply to have them bankrupt. They must respond to the notice of bankruptcy within 28 days. Usually this jolts people into paying.

Costs will depend on how far it goes. Issuing a Statement of liquidated claim costs around $150. But this also depends on how large the debt is. To serve a document can cost from around $20 to $100. You can actually go to court on your own. No real need for a solicitor. Just read up on it, and maybe attend a few beforehand to know the procedure.

And, if you don’t know where they are located, there may be expenses in finding them as if required (sometimes) to serve documents on them. eg. Notice of Bankruptcy has to be served to the actual person.

If they resist, the whole thing could take up to a year – especially if they use delaying tactics. Things usually never get this far, as most would be concerned about rising legal costs and losing and being forced to pay the other parties costs. So many give in and make an offer early on.

What state are you in? This is what happens in NSW, other states may be slightly different.

I would suggest you get a book on contract law (look for stuff in second hand uni bookshops) and look at local court websites etc.

Terryw
Discover Home Loans
Parramatta
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Another (not so nice) option is to let the whole thing slide, then threaten to put a caveat on the property so the vendor can’t sell it until they pay your out of pocket costs you incurred in the process of this failed deal. Or, don’t tell them you are doing it and just do it. They will get a nasty surprise when they try to sell it later on. I have heard that real estate agents do this to try and get commissions they are owed. The only problem is you are still out of pocket for a length of thime.
Good luck; don’t let this setback put you off – it’s one of the hazards of the job. Go out and get another deal.

Cheers,
Marc.
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You’re right; ethics is in short supply in r/e industry. Keep that in mind, but keep on investing.
Experience, unfortunately, can be expensive.

Cheers,
Marc.
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