De­lay on com­ple­tion day and you may face fi­nan­cial penalty

Yorkshire Post - Property - - PROPERTY - John Rob­son

lim­its within which the pur­chase monies are to be re­ceived by the seller’s con­veyancers. The Law So­ci­ety’s cur­rent con­di­tions are the Stan­dard Con­di­tions of Sale 5th Edition. The ma­jor­ity of con­veyancers use the cur­rent 5th Edition. Com­ple­tion of the pur­chase is gov­erned by Con­di­tions 6 and 6.1.3. (b) and re­quires the funds to reach the Seller’s con­veyancers bank ac­count by 2pm on the day of com­ple­tion.

Many con­veyancers amend this clause re­duc­ing the com­ple­tion time to 12.30 or 1pm. How­ever, the Law So­ci­ety rec­om­mend no amend­ments are made and this prac­tice is sup­ported by the Con­veyanc­ing Qual­ity Scheme (CQS).

As­sum­ing your pur­chase con­tract was not amended as to the com­ple­tion time, then the pur­chase funds must not have been with the seller’s con­veyancer by 2pm, cre­at­ing a breach of con­tract. At that point the seller’s con­veyancer is able to serve the Notice to Com­plete on your con­veyancer. Un­der the Stan­dard Con­di­tions of Sale 5th Edition there is no stand­alone clause re­lat­ing to a fee pay­ment for the Notice to Com­plete al­though it seems the seller’s con­veyancer amended the Stan­dard Con­di­tions to in­clude a fee of £125 plus VAT. In­ter­est is payable for late com­ple­tion un­der Con­di­tion 7.2.2.

Al­though dis­cour­aged by The Law So­ci­ety, amend­ments to con­tracts are made by the seller’s solic­i­tors for their clients’ pro­tec­tion. If there is an on­ward pur­chase then the seller’s con­veyancer will need to re­ceive the sale funds prior to the time limit set out in the pur­chase con­tract to avoid de­fault.

It is your con­veyancer’s duty to you to en­sure the mort­gage loan funds are re­ceived by them in good time to achieve the com­ple­tion within the con­tract time lim­its. Good prac­tice is to re­quest the mort­gage funds one work­ing day be­fore the com­ple­tion day to avoid the po­ten­tial for de­fault.

The keys to the prop­er­ties are not re­leased to the buyer un­til the pur­chase funds have been trans­ferred to and re­ceived by the seller’s con­veyancer.

Ac­cord­ingly, your seller will have been wait­ing out­side his new home with the re­movers and, due to the late com­ple­tion, un­able to ac­cess the prop­erty un­til late af­ter­noon. I sus­pect your seller will have in­curred ad­di­tional re­moval charges, which in the­ory form a claim for dam­ages against you. The amount payable for dam­ages will be over and above the in­ter­est for late com­ple­tion. The de­lay in the trans­fer of funds has im­pli­ca­tions re­sult­ing in fi­nan­cial penal­ties.

Your con­veyancer should have ar­ranged for the funds to be trans­ferred en­abling the com­ple­tion of your pur­chase within the time lim­its set out in the con­tract.

You may wish to con­sider rais­ing this with your con­veyancer. Es­sen­tially the breach was avoid­able.

John Rob­son is Res­i­den­tial Con­veyanc­ing Man­ager at Ford & War­ren Solic­i­tors, Leeds.

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