Property Sale fell through because of outside development...
Discussion
One for the property legal eagles here...
We had our business property up for sale and accepted an offer from a potential buyer. All was going well, expected completion date was the end of September give or take a week.
External to our property, a new housing development is being built, and the access "road" to our property has been connected to a new relief road for the town. Complete new entrance, security gate, etc.. all in and done. The relief road isn't complete yet, and the housing estate is still going up. Therefore, the relief road is not yet adopted.
The developers were to supply a document detailing the rights of access to the property during the works as we legally have access via the new estate. Our "road" was actually an ancient right of way, and bridleway, but to the west of the new relief road has pretty much been built on. The access wiggles through the new development, but is still pretty much there.
Without that document arriving, the buyers, at the last minute, pulled out of the sale citing "No legal access to the property" Even though the relief road is physically there - you can drive on it, the entrance and electric security gate is there and functional. We go in and out of it regularly! BUT because the road is not yet open, it has not been adopted by the Council, and therefore "doesn't exist".
Obviously large bills have been built up with solicitors, land agents/valuers, etc.. over this, one of the partners of the business who lived on the property had found another property to move to, and gone so far down the line that to pull out would cost him over £20K, and will lead to his life savings dwindling to nil if our sale doesn't go through in the next year. I was lucky that my own move had only just hit the starting blocks as my offer to a vendor was only accepted 4hrs before our buyer pulled out. Other partners have incurred legal costs.
Where do we stand? The developers have dragged their feet regarding a number of legal issues over the last couple of years relating to access, and have made it hell for us to get in an out at times by blocking our right of way.
I have suggested to the partners that we should seek compensation from the developers for the full value of our sale, they stopped it going through, so they should pay to that value.
So - over to the legal eagles - armchair and official...
We had our business property up for sale and accepted an offer from a potential buyer. All was going well, expected completion date was the end of September give or take a week.
External to our property, a new housing development is being built, and the access "road" to our property has been connected to a new relief road for the town. Complete new entrance, security gate, etc.. all in and done. The relief road isn't complete yet, and the housing estate is still going up. Therefore, the relief road is not yet adopted.
The developers were to supply a document detailing the rights of access to the property during the works as we legally have access via the new estate. Our "road" was actually an ancient right of way, and bridleway, but to the west of the new relief road has pretty much been built on. The access wiggles through the new development, but is still pretty much there.
Without that document arriving, the buyers, at the last minute, pulled out of the sale citing "No legal access to the property" Even though the relief road is physically there - you can drive on it, the entrance and electric security gate is there and functional. We go in and out of it regularly! BUT because the road is not yet open, it has not been adopted by the Council, and therefore "doesn't exist".
Obviously large bills have been built up with solicitors, land agents/valuers, etc.. over this, one of the partners of the business who lived on the property had found another property to move to, and gone so far down the line that to pull out would cost him over £20K, and will lead to his life savings dwindling to nil if our sale doesn't go through in the next year. I was lucky that my own move had only just hit the starting blocks as my offer to a vendor was only accepted 4hrs before our buyer pulled out. Other partners have incurred legal costs.
Where do we stand? The developers have dragged their feet regarding a number of legal issues over the last couple of years relating to access, and have made it hell for us to get in an out at times by blocking our right of way.
I have suggested to the partners that we should seek compensation from the developers for the full value of our sale, they stopped it going through, so they should pay to that value.
So - over to the legal eagles - armchair and official...
That was purely legal and loan arrangement fees - where he had to have a deposit in place to secure the purchase of his new property. When people buy houses and are in a chain, how often does that chain fall down? Quite often, yet it's how most house property deals are done. That doesn't stop people from buying and selling houses does it?
Thankfully conveyancing fees on house purchased are fairly low, but on a business such as a farm, where the value is in the order of a few million, you get to £20k very quickly and easily. Once you've instructed solicitors and land agents on a purchase, the till starts ringing, and they don't work for nothing and want paying.
Under English law, even if you've exchanged, the buyer can still pull out before completion because the deal is not done until the money changes hands.
Thankfully conveyancing fees on house purchased are fairly low, but on a business such as a farm, where the value is in the order of a few million, you get to £20k very quickly and easily. Once you've instructed solicitors and land agents on a purchase, the till starts ringing, and they don't work for nothing and want paying.
Under English law, even if you've exchanged, the buyer can still pull out before completion because the deal is not done until the money changes hands.
The heads of terms will also detail any compensation due to either party withdrawing from the transaction. I would be very surprised if it says anything other than there is no compensation and all parties preceed at their own risk.
Secondly, this issue sighted smacks of avoiding a much larger or harder to solve problem. It could be liquidaty in the purchacer, they are not meeting revenue or profit forcast etc and they have cold feet. Either way it is worth trying to get to the bottom of it before throwing £20k down the drain.
Secondly, this issue sighted smacks of avoiding a much larger or harder to solve problem. It could be liquidaty in the purchacer, they are not meeting revenue or profit forcast etc and they have cold feet. Either way it is worth trying to get to the bottom of it before throwing £20k down the drain.
As a buyer, I'd be very nervous about not having a legal right to access my house. We've certainly walked away from an otherwise "perfect" property due to access issues.
If I was promised that proof would be obtained and then it failed to turn up (and, as a buyer, I'm not interested in reasons/excuses), I'd be running away too.
I'd suggest this is something that should have been in writing before the house went on the market.
If I was promised that proof would be obtained and then it failed to turn up (and, as a buyer, I'm not interested in reasons/excuses), I'd be running away too.
I'd suggest this is something that should have been in writing before the house went on the market.
Given that either party can withdraw without reason prior to exchange of contracts, I suspect you are going to get nowhere with any compensation claim against the developer.
I recently pulled out of something similar. Until such time as roads and guaranteed access exists the risk is to great. What happens if the developer goes bust half way though the development?
I recently pulled out of something similar. Until such time as roads and guaranteed access exists the risk is to great. What happens if the developer goes bust half way though the development?
OP, unless you have a contract with the developer and the developed has failed to perform an obligation under that contract, you would have to show that the developer owed you a duty of care not to cause you economic loss through negligence. On the facts as you state them, I would assess your chances of establishing such a duty, and a breach thereof, as negligible.
blindswelledrat said:
Breadvan72 said:
thunderbelmont said:
T
Under English law, even if you've exchanged, the buyer can still pull out before completion because the deal is not done until the money changes hands.
That is pure 8 million per cent bUnder English law, even if you've exchanged, the buyer can still pull out before completion because the deal is not done until the money changes hands.
ks!
Honestly, some people....
A public highway does not have to be adopted. This is something that sometimes even highway officers need reminding of. Seems peculiar to me, as a non-legal but transport planner, that something like this should be used as a reason for pulling out of a sale. 
A route does not become "legal" by being adopted either. Adoption merely transfers the maintenance liability and certain rights to the highway authority.
A route does not become "legal" by being adopted either. Adoption merely transfers the maintenance liability and certain rights to the highway authority.
As pointed out already unless you have exchanged contracts for the sale you have nothing, zilch, f-all.
If they wanted the property they would work to get a solution.
why does it mean the partners life savings dwindling to nothing? is the farm running at a loss?
Difficult and distressing when a sale fall by the wayside thats for sure. Can another access point be made quickly to perhaps help on the land?
If they wanted the property they would work to get a solution.
why does it mean the partners life savings dwindling to nothing? is the farm running at a loss?
Difficult and distressing when a sale fall by the wayside thats for sure. Can another access point be made quickly to perhaps help on the land?
Edited by superlightr on Thursday 19th November 15:11
Breadvan72 said:
thunderbelmont said:
T
Under English law, even if you've exchanged, the buyer can still pull out before completion because the deal is not done until the money changes hands.
That is pure 8 million per cent bUnder English law, even if you've exchanged, the buyer can still pull out before completion because the deal is not done until the money changes hands.
ks!I think a few posters have got to the right platform but left on the wrong train here.
This situation has little or nothing to do with money changing hands, or completion of sale. What it has to do with, and why I (and BV has mentioned) have asked about a contract is that this is the crux:
If the OP has a contract with the developer to do X, Y and Z by a date, and they breach that, the OP could be entitled for recompense of the damage he has suffered due to the breach. That could include not being able to sell his property to a third party, if he wants to.
There is a case law about damages from a few years ago where a planning consultant failed to complete what was a basic admin task out of a larger contract. It may well have been confirming access, but it was something of that ilk should be completed by date X. The judgment was that the damages were the losses that the land owner incurred through not being able to sell his land when he wanted - this being the difference in loss of realisable value and interest. As it was land for a housing estate, the damages were much, much larger than the value of the contract itself.
I am not suggesting that this is the same as the OP's situation - however, finding out whether a contract with the OP has been breached by the developer should be the starting point for research into whether he seeks professional advice on if avenues are open to him for recompense.
Without that I fear that he has two hopes, one being Bob.
This situation has little or nothing to do with money changing hands, or completion of sale. What it has to do with, and why I (and BV has mentioned) have asked about a contract is that this is the crux:
If the OP has a contract with the developer to do X, Y and Z by a date, and they breach that, the OP could be entitled for recompense of the damage he has suffered due to the breach. That could include not being able to sell his property to a third party, if he wants to.
There is a case law about damages from a few years ago where a planning consultant failed to complete what was a basic admin task out of a larger contract. It may well have been confirming access, but it was something of that ilk should be completed by date X. The judgment was that the damages were the losses that the land owner incurred through not being able to sell his land when he wanted - this being the difference in loss of realisable value and interest. As it was land for a housing estate, the damages were much, much larger than the value of the contract itself.
I am not suggesting that this is the same as the OP's situation - however, finding out whether a contract with the OP has been breached by the developer should be the starting point for research into whether he seeks professional advice on if avenues are open to him for recompense.
Without that I fear that he has two hopes, one being Bob.
Edited by JustinP1 on Thursday 19th November 15:40
JustinP1 said:
I think a few posters have got to the right platform but left on the wrong train here.
This situation has little or nothing to do with money changing hands, or completion of sale. What it has to do with, and why I (and BV has mentioned) have asked about a contract is that this is the crux:
If the OP has a contract with the developer to do X, Y and Z by a date, and they breach that, the OP could be entitled for recompense of the damage he has suffered due to the breach. That could include not being able to sell his property to a third party, if he wants to.
There is a case law about damages from a few years ago where a planning consultant failed to complete what was a basic admin task out of a larger contract. It may well have been confirming access, but it was something of that ilk should be completed by date X. The judgment was that the damages were the losses that the land owner incurred through not being able to sell his land when he wanted - this being the difference in loss of realisable value and interest. As it was land for a housing estate, the damages were much, much larger than the value of the contract itself.
I am not suggesting that this is the same as the OP's situation - however, finding out whether a contract with the OP has been breached by the developer should be the starting point for research into whether he seeks professional advice on if avenues are open to him for recompense.
Without that I fear that he has two hopes, one being Bob.
Thank you for a civilised answer to my query, unlike some of the Jodrels that have insulted me earlier. I posted here because I am not a legal eagle, I'm a landowner and engineer, not fThis situation has little or nothing to do with money changing hands, or completion of sale. What it has to do with, and why I (and BV has mentioned) have asked about a contract is that this is the crux:
If the OP has a contract with the developer to do X, Y and Z by a date, and they breach that, the OP could be entitled for recompense of the damage he has suffered due to the breach. That could include not being able to sell his property to a third party, if he wants to.
There is a case law about damages from a few years ago where a planning consultant failed to complete what was a basic admin task out of a larger contract. It may well have been confirming access, but it was something of that ilk should be completed by date X. The judgment was that the damages were the losses that the land owner incurred through not being able to sell his land when he wanted - this being the difference in loss of realisable value and interest. As it was land for a housing estate, the damages were much, much larger than the value of the contract itself.
I am not suggesting that this is the same as the OP's situation - however, finding out whether a contract with the OP has been breached by the developer should be the starting point for research into whether he seeks professional advice on if avenues are open to him for recompense.
Without that I fear that he has two hopes, one being Bob.
Edited by JustinP1 on Thursday 19th November 15:40
king The Right Honourable Frederick Farquhar-Bankmanager QC. If you can't offer a civilised answer to an honest query troll off.I'm sure there were some agreements in place regarding access, but I haven't dealt with that. I'm sure our 'Big Firm' solicitors will have done all of that as part of the work done prior to put it on the market.
For the constructive replies, thank you, I am greatful for your candour. For everything else - f
k off back to school and grow up.You say that you were told that this new access road was going to be adopted, but hasn't been (yet), right?
You also say that this access road has a security gate on it, right?
I'm not challenging you, I just want to be clear, because most local authorities won't adopt a road that has a security gate on it - a road or highway needs to have a public right of passage along it. No public right of access? It's not a road in terms of the Highways Act 1980, so can't be adopted as a "public road" if it's not even legally a "road" in the first place.
If your story is as you set it out (and I am not doubting you have set it out correctly), then if there is to be a security gate on this "road", I think somebody has been telling porkies about the future status of this road. Check with your local roads authority (the County Council unless you are in one of the metropolitan authority areas) - ask them if there has been any application for Dedication of Highway, and if this road is designated as "prospectively adoptable", and if it has even been built to adoptable standards.
It might check out ok - I am not as familiar with English road adoption as I am with the process in Scotland (different Act) but it's worth being sure.
Swerving Mervin can probably advise better for roads in England.
You also say that this access road has a security gate on it, right?
I'm not challenging you, I just want to be clear, because most local authorities won't adopt a road that has a security gate on it - a road or highway needs to have a public right of passage along it. No public right of access? It's not a road in terms of the Highways Act 1980, so can't be adopted as a "public road" if it's not even legally a "road" in the first place.
If your story is as you set it out (and I am not doubting you have set it out correctly), then if there is to be a security gate on this "road", I think somebody has been telling porkies about the future status of this road. Check with your local roads authority (the County Council unless you are in one of the metropolitan authority areas) - ask them if there has been any application for Dedication of Highway, and if this road is designated as "prospectively adoptable", and if it has even been built to adoptable standards.
It might check out ok - I am not as familiar with English road adoption as I am with the process in Scotland (different Act) but it's worth being sure.
Swerving Mervin can probably advise better for roads in England.
Edited by tvrgit on Thursday 19th November 19:36
Swervin_Mervin said:
A public highway does not have to be adopted. This is something that sometimes even highway officers need reminding of. Seems peculiar to me, as a non-legal but transport planner, that something like this should be used as a reason for pulling out of a sale.
A route does not become "legal" by being adopted either. Adoption merely transfers the maintenance liability and certain rights to the highway authority.
Correct - the only difference between an adopted road and an unadopted road is who is responsible for its maintenance, not who is allowed to use it. A route does not become "legal" by being adopted either. Adoption merely transfers the maintenance liability and certain rights to the highway authority.
A private access is different - there is no public right of access - but presumably your existing access is via a private road (street lights, footways etc)? If so, nobody can take that away.
This new road is irrelevant (and possibly not even adoptable if it has a gate on it, as I said above)
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