The best laid plans of mice and men, and conveyancing solicitors.

The best laid plans of mice and men, and conveyancing solicitors.

Probably the most important document you will sign when you are buying or selling a residential property is the contract.

When we get to this point, we will explain to you in detail how, once you have signed, we will exchange contracts with the other side, at which point you are committed to the transaction and you cannot back out.

You must go through with it, and if you don’t, you could either be forced to comply by a court (at great cost to you) or you could be sued for damages and lose a considerable amount of money.

So it would be very reasonable for you to assume that once contracts are exchanged, both sides are committed, and the sale is guaranteed to go through.

Well, whilst almost every transaction that exchanges do go on to completion, things do sometimes go wrong.

I’m sure it won’t surprise you to learn that unexpected things do happen.

Houses blow up or burn down, people die or become very seriously ill and occasionally these things occur between exchange and completion of the sale of a property.  Sometimes, no matter how clearly they were made aware by their solicitors of the consequences of exchanging contracts, they change their minds and no amount of advice from their solicitors can force them to carry on.

Sometimes it can just be a temporary hitch (eg a short delay in getting the money from the mortgage company).  On other occasions, it can be more fundamental (such as if the purchaser has died and there is no readily available next of kin to take over).

Whilst we obviously hope this will never happen to you, and if it does, we will do everything we can to overcome whatever the problems are, here is a guide to what could happen, and what the options are.


So you’ve agreed to the sale of your property, contracts have been exchanged and your solicitor is now sitting on the 10% deposit, waiting for the balance of the purchase funds from the buyer’s solicitor so you can complete the transaction and move on to whatever it is you are going to do next.

It’s moving day, and you are sitting in your house, surrounded by boxes, waiting for the call from your solicitor to confirm the monies are in, and you can go.

Well, the solicitor calls, but the news is not good.  The money isn’t in, the banking day has come to an end and for whatever reason, the solicitor confirms it won’t happen today.  They may also confirm that there is a possibility it may not happen at all.

Whilst there is nothing to stop you leaving the property, if you were dependent on the proceeds of the sale to complete on your ongoing purchase, then clearly that purchase won’t complete either and you are stuck.

Your solicitor is likely to advise you to serve your purchaser with Notice, giving them a fixed period of time (usually 10 days) to complete.

The contract will provide for a level of damages for legal fees, which will have to be paid before completion can take place.  This should cover any expenses you incur, especially if you are then served with a notice to complete by the people you are buying from.

Very often, it’s a minor hold up, and the service of the Notice forces everyone to cooperate and work hard to get whatever the problem is fixed.  So there might be a delay, and some expenses incurred.

Often you will have to take a commercial view as to how much you ask for and what you are willing to settle for.  There is always a balance between what you actually want, and how long you are willing to hold the process up in order to get it.  So the reality is that you may be a few hundred pounds out of pocket just to get the deal over the line, but usually, it is possible to negotiate a deal to enable everyone to move on.

However, there are a few (very rare) occasions where, despite being served with the notice, your purchaser still doesn’t send the completion funds within the time specified in the notice.

This could be due to circumstances beyond their control.  Or it could be simply that they’ve changed their minds.

In those circumstances, at the very least you are entitled to keep their deposit, and you would be able to sue them for any damages you have suffered.  This could include the loss of your deposit if you are part of a chain.  It would also include legal fees, as well as any damages that you have to pay to anyone up the chain.


So it’s completion day, and you’re waiting for the completion monies to be sent to the vendor’s solicitor so that the keys can be handed over and you can move into your lovely new home.

You are all set to go, when you get a call from your solicitor saying that something has gone wrong.

They’ve had a call from the vendor’s solicitor to say that they cannot complete and any completion funds sent to them will be rejected.  Sometimes this can be due to a minor technicality that can be fixed, such as your solicitor still waiting for documentation from the vendor’s solicitor.  However, very very occasionally this can be due to something more fundamental, such as the vendor instructing his solicitors not to complete because they’ve changed their mind.

Whilst this is obviously terribly distressing news for you, there is some good news.

In those very extreme circumstances, there is something you can do to make the sale go through.

We can apply to the court for what is called an order for specific performance.

With most contracts that are breached, all you can usually do is sue the party who are in the wrong for damages.  However, with property transactions, the court accepts that the property you were going to buy is unique and that no amount of money will compensate you for the loss of that property, so they have the power to order the vendor to go through with the sale.

Although this can sometimes take a few weeks to get the order, the Court will say that not only must the vendor go through with the sale, but they must also pay you your costs and any damages you have incurred.

So if you have had to move out of your property (perhaps if you were in rented accommodation) and been forced to take a hotel room, you can claim for all your hotel bills, eating out (because you’ve got no kitchen) and anything else that you have had to spend as a result of the hold up.

As you can see, if a sale doesn’t complete, it can end up being very expensive for the party that is at fault.

This is why we are so careful to explain the consequences of exchanging contracts, and why it is so important that everything is in order before you commit yourself.   If you have any doubts about exchanging contracts or any concerns about completion, please talk to us before we exchange as we would never want you to end up in this situation.


Disclaimer – our articles are designed to give you guidance and information.  There is no substitute for proper direct advice, particularly as everyone’s circumstances are different.  If anything in this article may affect you, please contact us for advice that is specific to your circumstances.


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