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FLK2 - Property Practice > Stage 9: Completion > Flashcards

Stage 9: Completion Flashcards

1
Q

what are the stages of completion?

A
  1. Buyer’s solicitor sends PP to seller’s solicitor in accordance with contract (i.e. SCPC must be electronic). Seller’s solicitor will also releases deposit.
  2. Once received, the seller dates TR1 and hands/sends over any documents
  3. Once the TR1 is dated, the lender’s solicitor will date the mortgage deed.
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2
Q

when does legal title pass with reg land?

A

legal title does not pass until the buyer is registered at HMLR

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3
Q

when does legal title pass with unreg land?

A

legal title passes on completion

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4
Q

how can completion take place?

A

Completion takes place in person or by post

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5
Q

what is in place for completion by post?

A

law society protocol

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6
Q

what does the law society protocol on post completion provide?

A

o Seller’s solicitor acts as the buyer’s solicitor at no cost to the buyer. The buyer’s solicitor then gives them instructions as if they were in person.
o There is an implied undertaking to carry out buyer’s solicitor’s instructions
o The seller’s solicitor will confirm to the buyer once complete and the documents are sent by 1st class post or DX.

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7
Q

what are the remedies for delayed completion?

A
  1. contractual compensation
  2. common law damages
  3. rescission
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8
Q

what do the SC/SCPC provide in terms of delay?

A
  • SC/SCPC provides that ‘time is not of the essence unless notice is served’
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9
Q

what does ‘time is not of the essence unless notice is served’ mean?

A

o This means there is no immediate right to terminate or rescind the contract if a party is delayed until they have served a notice

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10
Q

re: contractual compensation

what is the position under SC?

A

the buyer and seller can be asked to pay compensation

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11
Q

re: contractual compensation

what is the position under SCPC?

A

only the buyer can be required to pay the compensation

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12
Q

re: contractual compensation

how is this calculated?

A
  • Compensation is calculated using the contract rate specified in the contract and calculated at a daily rate. If both parties default those days are ignored.
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13
Q

re: contractual compensation

what is the calculation?

A

o Purchase price - deposit paid (if the defaulting party is the buyer) x contract rate / 365 x no. days of delay = contractual compensation

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14
Q

re: common law damages

how are these damages assessed?

A
  • i.e. damages for breach of contract assessed using Hadley v Baxendale i.e.:
    o Putting claim in the position had the contract been properly performed
    o Reasonably foreseeable consequential loss is recoverable i.e. wasted legal costs, storage costs, renting
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15
Q

re: common law damages

what are the Haldey v Baxendale rules?

A

o Putting claim in the position had the contract been properly performed
o Reasonably foreseeable consequential loss is recoverable i.e. wasted legal costs, storage costs, renting

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16
Q

re: common law damages

what is the position in terms of common law damages and compensation?

A
  • Can claim contractual compensation and common law damages but the sum is deducted from the award.
17
Q

re: notice to complete

when does this apply?

A
  • Applies to SC/SCPC (otherwise would need to be specifically drafted in)
18
Q

re: notice to complete

when can this be served?

A
  • NTC can only be served after the completion date.
19
Q

re: notice to complete

what is the effect?

A
  • Once served, completion must take place within 10 working days
20
Q

re: notice to complete

what happens if the served party doesn’t comply?

A
  • If the defaulting party fails, the innocent party can rescind the contract & claim damages
21
Q

re: rescission

what do the SC/SCPC say regarding this?

A

SC/SCPC provides the contract can be rescinded where:
o Failure to comply with notice to complete
o Misrepresentation by seller in a plan, contract statement or negotiations and:
 There has been fraud or recklessness; or
 The buyer would be obliged to accept a substantially different property from what was expected

22
Q

re: rescission

what is the effect of rescission where the buyer is the defaulting party?

A

seller can forfeit (i.e. keep) the deposit

23
Q

re: rescission

what is the effect of rescission where the seller is the defaulting party?

A

seller must repay the deposit

24
Q

re: rescission

what is this position re rescission and other remedies?

A

damages can also be claimed

25
Q

when is rescission allowed for misrepresentation under SC/SCPC?

A

Misrepresentation by seller in a plan, contract statement or negotiations and:
 There has been fraud or recklessness; or
 The buyer would be obliged to accept a substantially different property from what was expected

FLK2 - Property Practice (16 decks)

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