Chapter 13: Delayed completion and Remedies Flashcards

1
Q

Any delay in completion entitles the innocent party to what?

A

Damages caused by the delay

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2
Q

Can an innocent party cancel the contract if completion is delayed?

A

The innocent party will only have the right to cancel the contract if ‘time is of the essence’

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3
Q

Is time of the essence in residential contracts for sale?

A

Generally time will not be of the essence unless specified in the contract

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4
Q

When must money due on completion by received?

A

By 2pm on the day set for completion

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5
Q

If completion is delayed, how much interest is the innocent party entitled to?

A

Interest at the contract rate on the outstanding balance for the number of days that completion was delayed by

Contract rate = purchase price + contents - deposit

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6
Q

What is rental income in lieu of compensation?

A

If the property being sold / purchased has a tenant in situ, the innocent part can elect to take the rental income until completion instead of compensation

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7
Q

If completion is delayed and the innocent party wishes to withdraw or terminate the contract, what must they do?

A

Serve a notice to complete on the other party. In turn, this will make time of the essence.

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8
Q

What are the requirements for notice to complete?

A
  • Party must be ready, able and willing to complete
  • The defaulting party must complete within 10 working days (excludes date of serving the notice)
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9
Q

If a buyer has received a notice to complete and has only paid a reduced deposit, what must they do?

A

Pay any remaining balance to bring the deposit up to the full 100%

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10
Q

If the buyer does not comply with notice to complete which has been served on them, what can the seller do?

A
  • Rescind contract.
  • Retain buyer’s deposit.
  • Resell the property.
  • Claim damages.
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11
Q

If the seller does not comply with notice to complete which has been served on them, what can the buyer do?

A
  • Rescind the contract.
  • Reclaim deposit monies with interest at the contract date.
  • Claim damages.
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12
Q

Which remedies are available to an innocent party following a breach of contract before completion?

A
  • Specific performance
  • Claim for compensation by way of damages
  • Recission
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13
Q

If completion is delayed, what can an innocent party seek damages for?

A

Losses flowing naturally from the breach plus reasonably foreseeable consequential losses

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14
Q

What is the measure of damages?

A

Standard measure - the innocent party is entitled to be placed, so far as possible, in the position that they would have been had the contract been performed

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15
Q

If a buyer has breached before completion, how will the seller be limited in recovering damages?

A
  • The seller will only be able to recover the difference in value between the contract price and the value on the re-sale.
  • If the resale price is higher, the seller should retain the buyer’s deposit and not pursue a claim for damages as well.
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16
Q

Under the Standard Conditions of Sale, in what two circumstances is recission permitted for misrepresentation?

A
  • Error or omission made fraudulently or recklessly
  • If the buyer took the property, it would be substantially different in quality, quantity or tenure from the property they expected to take
17
Q

Which two remedies are available for fraudulent and negligent misrepresentation?

A

Damages and rescission

18
Q

Which two remedies are available for innocent misrepresentation?

A
  • Rescission or damages in lieu of rescission
  • The claimant cannot claim both
19
Q

What remedies are available after completion?

A
  • The only available claim would be for breach of title guarantee or misrepresentation
  • The only available remedy is damages