Buying Property At Auction

Buying Property at Auction

A failure to take legal advice cost a property buyer his £35,000 deposit as he fell foul of the time limits for the purchase. Purchasing property at auction can be legally hazardous as the following case shows.

The Buyer paid the 10 per cent deposit after making the highest bid of £350,000 for the pub at auction. The deadline for completion of the purchase was not met so the seller sent a notice to complete. The buyer did not comply with this so the buyer kept the deposit and rescinded the contract.

In response the buyer lodged a unilateral notice against the pub’s registered title believing that he was able to do so as the contract was not dead and he was able to complete, and wanted to. The buyer contested that the seller had negotiated the transfer of the licence to the buyer and he had failed to do so therefore compromising the completion deadlines.

The seller applied to the First Tier Tribunal (FTT) to have the noticed removed from the premise’s title. There was a verbal agreement between the two parties regarding the licence, at a cost of £2,000 plus additional money for the inconvenience. There was nothing in the auction information to make the reassigning of the licence as an essential part of the sale. At no point did either of them take legal advice.  No money had been paid in respect of the licence so the FTT stated that as it was a separate agreement it did not compromise the sellers right to enforce the deadline for completion.

If you are would like more information about buying a property, whether its at an auction or through an agent, please contact us by telephone at our Corby office on 01536 276300 or call our Kettering office on 01536 311690 or simply get in touch online by clicking here.