Delayed Settlement Questions...

Discussion in 'The Buying & Selling Process' started by punti, 9th Apr, 2020.

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  1. punti

    punti Active Member

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    Hi PC Members, I'm having a little situation with my current settlement. I have purchased a property which was due to settle today, however, I attended the property Monday this week and found the property to be vandalised. Luckily only minor damage, ie a bit of graffiti, slashed fly-screen. I notified the agent at the settlement inspection whom assured me it would be rectified. I've notified my solicitor of the issue by phone and email.

    Yesterday, the day before settlement, I received a phone call from the RE stating that the Vendors Conveyancer was having difficulty contacting my solicitor for pre-settlement disbursement. To which I replied he most likely did not send them through as we have had no confirmation that the graffiti etc had been rectified. They assured me that it had, and sent me some low-resolution photos. I was quite shocked that no one had made any attempt to contact me or my solicitor regarding the completed works. Either way, I asked to book another settlement inspection as I wanted to make sure everything was completed correctly. (I assume I am allowed to do another settlement inspection?) After getting off the phone, my phone is flooded with photos.

    Now, photos of half the work isn't going to cut it for me, and in those photos, I can still see the graffiti hasn't been cleaned properly or flyscreen repaired. I notified the RE whom is now not responding to me via phone or sms. I must admit, my solicitor has been quite slack with contact and updates during this settlement. Someone I do not intend to be using again, however, he's locked in now so it is what it is.

    My questions are, how can anyone expect settlement to occur today when repairs have not been completed? What is my situation moving forward? I am still keen to purchase but what day would settlement be? Can they make it as early as next Tuesday (pub hols) if the works are completed today? I wouldn't think I'd be responsible for penalty fees due to this delay?

    I might also add, the property is over 2 hours away from where I live so I cannot inspect at the drop of a hat, nor should I be required to.

    TIA
     
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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    Sure they can expect settlement but you can refuse. What does your lawyer say?
     
  3. punti

    punti Active Member

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    I haven't been able to contact him since the RE called. I've left a message for him yesterday and again this morning to return my call, but nothing so far.
     
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  4. KingBendtner

    KingBendtner Well-Known Member

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    It's prudent that you are satisfied that all issues are rectified prior to settlement.
    Push back as much as you can and let your solicitor communicate this legally to all parties.
    Do you know what time is settlement today?
    Is it going through electronically, PEXA?
    And I assume this for an IP?
     
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  5. punti

    punti Active Member

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    Yep IP. No idea what time, but yes PEXA.
     
  6. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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    Is it NSW?
    Have you been affected by Covit in anyway? Thinking about finance withdrawal risk here.
     
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  7. punti

    punti Active Member

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    Yep in NSW. Self employed, no reduction in income or work.

    Finance approved no issues. Have investment redraw secured against PPOR if finance did fall through.
     
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  8. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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    Then you would likely have more than 2 weeks up your sleeve at the very least. You have leverage over the vendor. They might be borrowed about settlement even happening as some purchasers are affected by the Corona virus.
     
  9. punti

    punti Active Member

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    Yep, I was thinking that.

    When the settlement does not go ahead today, can they issue a Notice to Complete even though settlement is being held up on their end?
     
  10. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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    Yes they can. But will it be valid? That is the question!
     
  11. Paul@PFI

    [email protected] Tax Accounting + SMSF Business Plus Member

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    There could be a retention subject to works being acceptable. This would avoid delays and leave both parties agreedable to it being fully fixed after settlement.

    Settlement delays will be the norm at present. In such cases it could be all parties just have to move on and accept it.
     
  12. punti

    punti Active Member

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    So as expected, settlement did not complete today. The agents have done a 180 and insisted that the remaining works were never agreed upon (flyscreen etc). I just found out, my solicitor only dictated the issues and never put it in writing. I don't want to get into litigation so I assume I will just suck it up and settle.

    They have notified me that they are intending to impose penalties as set-out in the contract. 10%pa on purchase price plus conveyancer fees....ouch.

    I will be expressing my disappointment to my solicitor after settlement.
     
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  13. wylie

    wylie Moderator Staff Member

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    Are they not looking to settle next week?
     
  14. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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    You give up easily!
     
  15. punti

    punti Active Member

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    Yes, settlement is booked for next Friday, so not too bad re penalty charges.
     
  16. punti

    punti Active Member

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    I most certainly have in this scenario, but tbh I have a 2-week old that I'm currently more interested in spending time with then worrying anymore about this settlement!

    Thank you everyone for your advice.
     
  17. Pumpkin

    Pumpkin Well-Known Member

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    Is this a Standard Clause? Sorry I have not look at Contract for years!