Hi everyone,
i would love to know if anyone has been in this situation or can offer advice.
We agreed to buy a property back in December 2007 (YES YOU READ IT RIGHT). Settlement still hasn't gone through as there was a hold up with a bit of the land being subdivided and after many letters from my conveyancer over 2 and a half YEARS we decided a couple of weeks ago to pull out of the deal.
We have a 'licence agreement' with the owners that if they didn't settle within 30 days (back in 2007) that we can utilise the property. So we did and have had it rented since then.
I have just had a call from the propety manager informing me that the owners solicitors sent a letter to them to 'withhold all rent owed to us'!!!!!
i am waiting for my conveyancer to call me today (but hasn't even though i have left messages and sent urgent emails last night).
The conveyancer told me a few weeks ago that we could back out of the deal and get our 10% deposit back as either party could do this if settlement didn't take place within 18mths. Can anyone shed some light on what our rights are to the rent we have been getting over the last few years, can we keep it even though we are backing out of the deal?
They informed the conveyancer ONE DAY after we faxed them a letter that we didn't want to proceed and SUDDENLY they are ready to settle. but we don't want to anymore. Can they force us to settle because we didn't give sufficient notice or can they keep our deposit?
thanks in advance, i am very stressed about this situation.
My brief thoughts are that in order for you to back out of the deal you would need to issue them with a default notice, which is a formal notice giving them a certain amount of time (the actual amount depends on the state) to meet their obligations, failing which you will terminate the contract. I don't think that you can just suddenly back out without giving a default notice.
As to the rent, that depends what was written in the contract. If the contract just says that you can "utilise" the property, then I don't like your chances of getting the rent. Why should you be entitled to the rent on a property that you don't own? If the contract says that you can keep any rent you get then the vendor is bound by this. Have you already received the rent? If so, the vendor will have to sue you to get the rent back. It would be expensive for them to do this and probably not worth their while.
But that is just my opinion without knowing the facts. You need to get legal advice. You should see a solicitor rather than use a conveyancer. This has contractual issues which are out of the realm of a conveyancer.
Cheers
K
I would probably fling the conveyencer and get a solicitor to handle it from here.
Just curious, has the property fallen in value since 2007?How has 2 and a half years happened. Your post says Dec 2007, now is May 2009. This is only 17 months.
LOL, ooops i was a little stressed when i wrote it all. IT IS DECEMBER 2006 WHEN WE AGREED TO BUY IT.
Update is, (and thanks for replies), we were buying it from a council and i guess they just didn't seem to take personal ownership of the settlement or following things up (even with us faxing and asking). we even had a letter from their solicitor stating the bank had misplaced a title!!!!
So i spoke with my conveyancer and she reminded me that i did put a special condition in the contract stating 'we get to keep any rent that has been paid up until the date of settlement. Another condition put in was 'if after 12mths settlement has not proceeded then either party can withdraw from the sale'.
I'm just glad to realise i wasn't so stupid as to not put in that clause. I think it would have to be close to a record for longest settlement thats for sure.
We came out of it with 27 months rent and our 10% deposit back. (we were getting a 65% return on our outlay) NOT A BAD DEAL. (BUT WE DID HAVE TO PAY ALL OUTGOINGS ON THE PROPERTY, water, rates, upkeep)
for those wondering why i didn't settle and on-sell or flip, value had gone up 7% in that time but by the time you take away costs, it's easier to walk away.
i only learnt to put in special conditions like those after i was burned by a delayed settlement elsewhere and a tenant i had lined up had to walk away.
maybe someone else will read this and know that delays happen and you can only ask if you can have access earlier with special conditions just incase.
Well thanks for sharing your story. It certainly never occurred to me that settlement might be delayed by such a lengthy amount of time. Then, when you said you were buying it from a local council, well, let's just say everything became a little clearer. Councils – a law unto themselves.
good luck
S
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