Hi All,
I purchased an 'off the plan' apartment in late 2007, the land sat vacant since then. Just recently i received a letter from the 'new developer' (PDG) saying they purchased the site and will be giving existing contract owners first choice to sign onto their development (no real discount and of course prices have gone way up). They say they have no legal obligation to the existing contract holders but are offering this anyway.
The original developer bought the land for approx $4mil around 2007 and sold for $19.7 mil last year according to news reports.
The sunset clause on my contract is 5 years.
Has anyone faced this before ? or something similar ? or is also a contract holder in the old Barton Tower development ?
Should I be chasing the old developer – they obviously can not honour the contract now and sold their interests in it knowing of their existing obligations, or can i get the new developer to honour the old contract ? ie, they must have been aware of the existing contracts before buying the land….
Would love to hear anybody's thoughts, comments or advice
review your option contract & look for an assignment clause.
I had a client in a similar situation- and they were able to cancel the contract and get their 10% back.
If the new company is asking you to “sign up” with them. then it sounds like you have the option to leave and get your money back or go for the new contact.
Regards
MichaelMick C | Shape Home Loans
http://www.shapehomeloans.com.au/
Email Me | Phone MeSame Banks. Better Rates. Served With a Passion.
Thanks IP Freely,
I did as you said – and to paraphrase that section of the contract, the Vendor reserves the right to assign interest in this contract to a third party for whatever reason…….
But my point would be that this allows assignment, not relinquishment of the obligations of the original vendor. Or am I on the wrong track here ?
I am thinking that I would/could be able to sue the original vendor for breach of contract (ie they have no intention of honoring their end of the contract) and/or I would/could be able to apply for an injunction against work that the new vendor is carrying out (they have no intention of honoring the original contract either).
Regardless of all the contract statements and abilities under law and what is permissible through 'Gazumping' …… It just seems to me completely wrong that I could sign a contract, vendor signs the contract, I pay 10% deposit as required and then be left out of the whole deal whilst still within the sunset clause date……
The contract also states that the purchaser is not allowed to take out a caveat on the title. If i did this (keep in mind that i still have a valid contract for approx 2 years) – "They" would need to show that I am still bound to that contract to enforce the 'purchaser may not take out a caveat' clause, otherwise it would remain and no doubt throw settlements into dissaray.
Regards.
I would contact all other purchasers and launch a class action lawsuit.
You and the original developer entered into a legal contract, whereby you put down $x in assurance that you would receive an apartment on the y.y.2012.
I would have a lawyer (team of lawyers, actually) take a very hard look at every single clause in the contract, and establish what "the Vendor reserves the right to assign interest in this contract to a third party for whatever reason" actually means under the law.
You see, to my thinking (and im sneaky), the vendor may assign interest in this contract to a third party for whatever reason" BUT that says nothing about the conditions of that assignation. Ie you should be able to reasonably argue that the vendor may be able to reassign interest to another party, but must also maintain your interest as a purchaser, or compensate you accordingly for breach of contract (unreasonable actions = breach)
The facts are plain:
you entered into a contract with the reasonable expectation that you would receive the property purchased
you paid a deposit
your vendor onsold for a vastly increased price
you and everyone else have suffered opportunity cost unreasonablyLawyers are going to love this. The purchaser, and new owner both, are going to hate it. Burn them. Lodge a FOI request if you have to and find out who the other buyers are, but find out who bought into the old development one way or another, combine forces so as to prevent both developers using the legal system as a weapon in and of itself, and go toe to toe. 4 mill to 20 mill is nothing to sneeze at – theres a lot of money in the pot, and a lot for both developers to lose (the first guy just made $16M. the second guy, if buying for $20M, is launching a project worth tens of M.) Even just miring them in court is going to cost them a lot of money, and they know it.
…otherwise known as "leverage".
Ill make some calls about this, im curious.
Would be interested on where this is going. Keep us updated.
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