Exchanged contracts, discovered seller not been tranparent
Discussion
Muncher said:
I don't think that sounds like a good plan. If I were acting for the sellers the deposit wouldn't be going anywhere. Again, be very wary of accepting legal advice from those that are not qualified to give it! I would be interested to know why your solicitor didn't press for a response to the unanswered question. My gut instinct is you have a better chance of making a claim against your solicitor than successfully rescinding the contract.
I think the consensus is roughly 50/50 - one half suggesting because there appears to be a strong case of misrepresentation, it's unlikely they'll come back at us. As someone said, it puts us in the driving seat but a risky move with short timeframes involved.And the other half suggesting a claim against the solicitor would be easier. They are insured for this sort of thing, I understand.
But as must be apparent... I'm no expert so we'll press for specialist advice tomorrow.
I would also say that having seen an application for a site of that nature, just because it has been refused does not mean that it might be appealed some point in the future or that a "fresh application" might be lodged. I don't think the appeal is particularly relevant here.
I rather suspect if the OP had posted something along the lines of "I've just bought a house, near to a site where they have been trying for some time to get a waste plant built, a new planning application has been lodged, can I sue my seller as they knew this was likely" then I suspect the responses to this thread would be rather different.
I rather suspect if the OP had posted something along the lines of "I've just bought a house, near to a site where they have been trying for some time to get a waste plant built, a new planning application has been lodged, can I sue my seller as they knew this was likely" then I suspect the responses to this thread would be rather different.
Muncher said:
I rather suspect if the OP had posted something along the lines of "I've just bought a house, near to a site where they have been trying for some time to get a waste plant built, a new planning application has been lodged, can I sue my seller as they knew this was likely" then I suspect the responses to this thread would be rather different.
I (along with 99% of other here) ANAL, but I thought the TP6 form and notes are pretty clear that the seller must disclose anything that would have caused them to change their answers up to exchange.So even if this wasn't an appeal, and an application arrived 'out of the blue', surely seller has a duty to notify their solicitor? We had a neighbour put in for planning permission before exchange when we sold our house. Notified our solicitor/agent as soon as the council letter hit the doormat.
Is it the solicitors fault? Partly, because that question being unanswered should have been a red flag. And, advising abut the possibility of a refused application being appealed (or even, resubmitted) would have been sensible.
Edited by silentbrown on Sunday 24th September 20:45
silentbrown said:
Muncher said:
I rather suspect if the OP had posted something along the lines of "I've just bought a house, near to a site where they have been trying for some time to get a waste plant built, a new planning application has been lodged, can I sue my seller as they knew this was likely" then I suspect the responses to this thread would be rather different.
I (along with 99% of other here) ANAL, but I thought the TP6 form and notes are pretty clear that the seller must disclose anything that would have caused them to change their answers up to exchange.So even if this wasn't an appeal, and an application arrived 'out of the blue', surely seller has a duty to notify their solicitor?
We had a neighbour put in for planning permission before exchange when we sold our house. Notified our solicitor/agent as soon as the council letter hit the doormat.
The original submission was disclosed.
silentbrown said:
I (along with 99% of other here) ANAL, but I thought the TP6 form and notes are pretty clear that the seller must disclose anything that would have caused them to change their answers up to exchange.
So even if this wasn't an appeal, and an application arrived 'out of the blue', surely seller has a duty to notify their solicitor? We had a neighbour put in for planning permission before exchange when we sold our house. Notified our solicitor/agent as soon as the council letter hit the doormat.
Is it the solicitors fault? Partly, because that question being unanswered should have been a red flag. And, advising abut the possibility of a refused application being appealed (or even, resubmitted) would have been sensible.
If anything, it may be the solicitor's fault.So even if this wasn't an appeal, and an application arrived 'out of the blue', surely seller has a duty to notify their solicitor? We had a neighbour put in for planning permission before exchange when we sold our house. Notified our solicitor/agent as soon as the council letter hit the doormat.
Is it the solicitors fault? Partly, because that question being unanswered should have been a red flag. And, advising abut the possibility of a refused application being appealed (or even, resubmitted) would have been sensible.
Edited by silentbrown on Sunday 24th September 20:45
This doesn't entitle you to rescind the contract.
In practice, you will need deep pockets to mount a claim against the solicitors, something like that could easily cost £50k in fees, with the risk you are unsuccessful and have to pay the solicitor's legal fees.
You will then need to prove a loss, the defendants will suggest that the price you actually paid was one which took account of the fact development was likely, if not via this application, but by another.
I suspect you will then be deciding whether you want to stump up ~£100k, in order to have a questionable chance of recovering what might be a small amount.
Muncher said:
If anything, it may be the solicitor's fault.
This doesn't entitle you to rescind the contract.
In practice, you will need deep pockets to mount a claim against the solicitors, something like that could easily cost £50k in fees, with the risk you are unsuccessful and have to pay the solicitor's legal fees.
You will then need to prove a loss, the defendants will suggest that the price you actually paid was one which took account of the fact development was likely, if not via this application, but by another.
I suspect you will then be deciding whether you want to stump up ~£100k, in order to have a questionable chance of recovering what might be a small amount.
I agree - action against a legal adviser should not be contemplated lightly. But then, neither should completing the purchase if it is true that the house will be worth significantly less if the planning app goes through. And if the first of their additional enquiries wasn't "Please supply answers to section 3 of the PIF" then they have mucked up.This doesn't entitle you to rescind the contract.
In practice, you will need deep pockets to mount a claim against the solicitors, something like that could easily cost £50k in fees, with the risk you are unsuccessful and have to pay the solicitor's legal fees.
You will then need to prove a loss, the defendants will suggest that the price you actually paid was one which took account of the fact development was likely, if not via this application, but by another.
I suspect you will then be deciding whether you want to stump up ~£100k, in order to have a questionable chance of recovering what might be a small amount.
At least this has all surfaced before the transaction has completed so OP has more options than if it had come up after completion. OP, it sounds like there are significant sums at stake (and definitely would be if you're contemplating not completing). Take some advice from a new solicitor as to what they might be.
As to the law, for the debate, if the seller never said anything about the proposal (as opposed to giving an untruthful/misleading answer) then it's unlikely that there's been any misrepresentation (silence would not normally be a misrep). But in addition to possible redress against the OP's advisers, the professionals acting for the seller might have some explaining to do - the Consumer Protection from Unfair Trading Regulations place a duty on traders not to make misleading omissions and they might be relevant here (although their application to the seller's conveyancer is a very grey area). Bringing them up might give the OP some bargaining chips.
Edited by bladebloke on Sunday 24th September 22:55
Edited by bladebloke on Sunday 24th September 22:56
Muncher has been offering some sage advice throughout the latter parts of this thread, I'd heed his advice.
However, as I stated earlier my appetite for risk is fairly high and if it was me I'd play the vendor and get them to come after me for the money after I backed out.
You know they've sold you a pup, they know they've sold you a pup so stick two fingers up at them and say come and have a go if you think you're deep pocketed enough. I think there's still a chance you can blag your way out of the deal.
However, as I stated earlier my appetite for risk is fairly high and if it was me I'd play the vendor and get them to come after me for the money after I backed out.
You know they've sold you a pup, they know they've sold you a pup so stick two fingers up at them and say come and have a go if you think you're deep pocketed enough. I think there's still a chance you can blag your way out of the deal.
bladebloke said:
As to the law, for the debate, if the seller never said anything about the proposal (as opposed to giving an untruthful/misleading answer) then it's unlikely that there's been any misrepresentation (silence would not normally be a misrep).
How about the sellers failure to pass on the appeal notification to the buyer? As you say, If it's the solicitors cockup then the vendor can still try and force the buyer to complete the contract. Alternatively damages to the vendor could be huge if this happens, particularly if the house is then worth 15% less than the asking price...
silentbrown said:
How about the sellers failure to pass on the appeal notification to the buyer?
As you say, If it's the solicitors cockup then the vendor can still try and force the buyer to complete the contract. Alternatively damages to the vendor could be huge if this happens, particularly if the house is then worth 15% less than the asking price...
He was under no duty to do so. Buyer beware - if you don't ask you don't get. By section 3 if the PIF, buyer asked but got no reply (but went ahead anyway)As you say, If it's the solicitors cockup then the vendor can still try and force the buyer to complete the contract. Alternatively damages to the vendor could be huge if this happens, particularly if the house is then worth 15% less than the asking price...
bladebloke said:
He was under no duty to do so. Buyer beware - if you don't ask you don't get.
Surely there's some duty to notify buyer of material changes between PIF and exchange? What if the house burns/falls down, or some such?I know this is hardly in the same category, but if there's no duty to do so, then surely the PIF notes saying you must notify are essentially meaningless?
IANAL but my understanding is that having exchanged and agreed a completion date, if you fail to complete, it isn't just a case of forfeiting the deposit. In breach of contract the vendor can come after you for damages, which the deposit might satisfy, but there is nothing to stop the vendor coming after you for a larger amount. There have certainly been court cases where a buyer has had to pay substantial damages over and above the deposit, when pulling out. Typically in a falling market where the resale value has dropped.
I would be very careful about trying to take a very robust position because I think you are on dodgy ground. I would take a pragmatic approach. I am not sure not giving information could ever be misrepresentation. I do think your solicitors have let you down a bit by allowing you to exchange without clarifying a blank entry first, but at the end of the day that is your mistake, not the vendors.
I would be very careful about trying to take a very robust position because I think you are on dodgy ground. I would take a pragmatic approach. I am not sure not giving information could ever be misrepresentation. I do think your solicitors have let you down a bit by allowing you to exchange without clarifying a blank entry first, but at the end of the day that is your mistake, not the vendors.
https://www.tpos.co.uk/news-media-and-press-releas...
TPO give good guidance against the EA
As others have said I think the sellers also have not answered their questions correctly and I too have a high risk threshold for court action. If this is a major issue for you and you would not have bought the house had you known then I would pull out and ask for the deposit back - if they don't start a claim.
my action would be against the vendors for not disclosing (not necessary the solicitors) go for the weakest party. I think a court would rescind the contract and put both parties back where they were before exchange.
If you are going to pull out/do so- don't start negotiating a price reduction and then try to pull out as that will go against you.
Its the sellers who have misled and under the Misrepresentation Act the onus is on the sellers to disclose.
more good info here:
https://www.lovemoney.com/news/21315/what-should-y...
What if you are sued?
Under the law (specifically the Misrepresentation Act 1967) the burden of proof of misrepresentation has shifted from buyer to seller. This means it isn’t up to the buyer to prove you knowingly lied on the form, it’s up to you to prove you didn’t if they make a claim against you.
If a court finds you guilty of misrepresentation – which might be fraudulent, negligent or even innocent – it can order you to pay damages to your buyer, which can run into tens of thousands of pounds depending on the nature of the problem.
If the misrepresentation is serious enough it can also order rescission of the contract, meaning you would need to buy back your old property and cover any expenses of the buyer, including mortgage interest and legal costs – which could total a small fortune.
Finally remember that misrepresentation isn’t confined to the Property Information Form
TPO give good guidance against the EA
As others have said I think the sellers also have not answered their questions correctly and I too have a high risk threshold for court action. If this is a major issue for you and you would not have bought the house had you known then I would pull out and ask for the deposit back - if they don't start a claim.
my action would be against the vendors for not disclosing (not necessary the solicitors) go for the weakest party. I think a court would rescind the contract and put both parties back where they were before exchange.
If you are going to pull out/do so- don't start negotiating a price reduction and then try to pull out as that will go against you.
Its the sellers who have misled and under the Misrepresentation Act the onus is on the sellers to disclose.
more good info here:
https://www.lovemoney.com/news/21315/what-should-y...
What if you are sued?
Under the law (specifically the Misrepresentation Act 1967) the burden of proof of misrepresentation has shifted from buyer to seller. This means it isn’t up to the buyer to prove you knowingly lied on the form, it’s up to you to prove you didn’t if they make a claim against you.
If a court finds you guilty of misrepresentation – which might be fraudulent, negligent or even innocent – it can order you to pay damages to your buyer, which can run into tens of thousands of pounds depending on the nature of the problem.
If the misrepresentation is serious enough it can also order rescission of the contract, meaning you would need to buy back your old property and cover any expenses of the buyer, including mortgage interest and legal costs – which could total a small fortune.
Finally remember that misrepresentation isn’t confined to the Property Information Form
Edited by superlightr on Monday 25th September 10:23
Edited by superlightr on Monday 25th September 10:54
Edited by superlightr on Monday 25th September 10:54
superlightr said:
That's a slightly odd one, in that the buyer found out early, made a reduced offer and only complained when their reduced offer was rejected... No sale, but 'buyer' awarded £400.This one shows major problem found after completion. https://www.tpos.co.uk/news-media-and-press-releas...
Award of £25K against the EA.
Not sure if this has already been mentioned, but whilst there's a lot of talk of the potential reduction in value of the house, I don't see anything about future saleability. Related, but not entirely the same thing.
The house value may drop 10/15/20% or more, but in reality will anyone actually want to buy it? Or will they only buy it at a 50% reduction in price? It's the OP's first purchase so there is a reasonable expectation he might want to move again in the foreseeable. I would certainly be factoring this in to any decision on how to proceed.
The house value may drop 10/15/20% or more, but in reality will anyone actually want to buy it? Or will they only buy it at a 50% reduction in price? It's the OP's first purchase so there is a reasonable expectation he might want to move again in the foreseeable. I would certainly be factoring this in to any decision on how to proceed.
There is another angle to consider.
I dont imagine your lender's underwriters will be comfortable lending against a property which might be worth considerably less than their exposure.
And if you proceed with the purchase, you will need to be as economical with the truth as your seller has been if you wish to complete.
To be honest I dont see how you can proceed with the purchase until the situation is resolved.
I dont imagine your lender's underwriters will be comfortable lending against a property which might be worth considerably less than their exposure.
And if you proceed with the purchase, you will need to be as economical with the truth as your seller has been if you wish to complete.
To be honest I dont see how you can proceed with the purchase until the situation is resolved.
SantaBarbara said:
Keep calm and do not panic
Wait and see how the appeal progress
The Council may appoint QC to defend their decision
I would suggest this may weaken the OP position. The issue is the non disclosure not the final result of the planning. If they had known xyz (which should have been disclosed on the form) would they have exchanged? Wait and see how the appeal progress
The Council may appoint QC to defend their decision
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