The client instructed Samuel Okoronkwo Jr. to provide legal advice following a dispute arising from the failed completion of the purchase of a parcel of land acquired through an auction process.
The client entered into a contract to purchase the property at auction and paid monies towards the purchase price, including a deposit. Following the auction, the auction house provided instructions regarding the steps required to complete the transaction, with completion due within the contractual timeframe.
A completion statement was subsequently issued confirming the completion date. However, the client failed to complete the purchase within the required period, resulting in the seller taking steps to terminate the contract. The seller relied upon the auction conditions, which permitted the service of a notice to complete and provided that failure to comply could result in termination of the contract, forfeiture of the deposit and potential recovery of damages.
The client’s position was that there were issues surrounding the completion process and whether he had been properly informed and advised regarding the steps required to complete the transaction. The client sought advice regarding his position, including whether the seller was entitled to terminate the agreement and retain monies paid.
The principal issue was whether the client had failed to comply with the contractual completion requirements and whether the seller was therefore entitled to terminate the contract and retain the deposit.
Counsel considered the effect of the auction conditions, including the requirement for either party to serve a notice to complete following failure to complete on the agreed date. Counsel considered whether the notice had been properly served, whether the client had sufficient notice of the consequences of non-compliance and whether the seller had acted within its contractual rights.
A further issue concerned the conduct of the client’s solicitor and whether the client had been properly advised regarding the completion process, including the provision of funds, the completion statement and the consequences of delay.
Counsel also considered whether the client had any potential claim arising from professional negligence if it could be established that the failure to complete was caused by inadequate advice or a failure by the solicitor to properly communicate the completion requirements.
Counsel advised that the client’s position depended upon establishing the circumstances surrounding the failed completion, including whether the client had received the notice to complete, when it was received and whether the client had been properly advised by his solicitor.
Counsel advised that further documentation was required, including correspondence between the client and his solicitor, the notice to complete, the completion statement and any correspondence confirming termination of the contract.
Counsel advised that if the client had received proper notice and had failed to complete within the required period, the seller was likely to have been entitled to terminate the contract and retain the deposit in accordance with the auction conditions.
However, if it could be established that the client was not properly advised, did not receive the relevant notices or that the solicitor failed to act appropriately, consideration could be given to pursuing a professional negligence claim against the solicitor.
Counsel further advised that, if the contract had been validly terminated, the client should seek clarification regarding any monies paid in excess of the deposit and whether any sums remained recoverable following the termination of the agreement.
Further evidence was required before a final position could be determined, particularly in relation to the completion process, communications with the solicitor and the seller’s decision to terminate the transaction.
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