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Aston Lawyer
Aston Lawyer, Solicitor
Category: Law
Satisfied Customers: 10125
Experience:  Solicitor LLB (Hons) 23 years of experience in Conveyancing and Property Law
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HiWe are considering entering into a "conditional contract"

Customer Question


We are considering entering into a "conditional contract" for the sale of our property. the condition will be on the grant of a natural england licence that is a condition of planning permission (fully granted with conditions).

Can you tell me how "binding" the conditional contract is for us as a seller, and the buyer please? I.e. is it 100% clear that if the buyer cancels the contract for any reason within the long stop date that the buyer will have legal terms imposed (i.e. loss of deposit). Or is the "conditional contract" as I have read elsewhere, entirely "hypothetical".

Related to this, we need to understand who is the best party to obligate the acquisition of the licence to; seller (us) or buyer.

Submitted: 3 years ago.
Category: Law
Expert:  Aston Lawyer replied 3 years ago.


Hi there,


Thanks for your enquiry.


A conditional Contract is very much binding on both parties, if the condition is met!


Basically, what happens is as follows;-


Once the Buyer has carried out the appropriate searches/ his Solicitor checked the title etc, Contracts will be exchange din the normal fashion, and the Buyer will pay a 10% Deposit.

There will be a clause in the Contract stipulating that completion will take place X days after Planning permission has been obtained/requisite Licence has been obtained, provided that if either of these conditions are not met within say 6 or 12 months then either party is free to cancel the Contract and any Deposit is to be returned to the Buyer.


Therefore, provided planning permission/licence is obtained, then the Buyer is legally bound to complete in accordance with the Contract.


It would be normal for the Buyer to spend the time and money on obtaining planning permission and the Licence. You are of course free to help with obtaining the Licence if so required.


I hope this gives you an overview. Not sure if you want me to go into more detail?


Perhaps you could let me know if you require any further assistance.


Kind Regards


Customer: replied 3 years ago.



Thanks but this doesn't really answer my question.


How binding is the contract during the period between "agreement of conditional exchange" and the elapsed time until the "long stop date"?


Can the buyer decide to "give up" and cancel the contract in this period?


Regarding obligations to comply with the condition, my research shows the case of Extra and Accor which shows that wrongdoing cannot be a reason for breach / cancellation. So does this apply to residential sales and therefore, we should push the obligation to obtain the consent to the buyer?


I understand that at the point that the condition is met that the contract becomes unconditional (a normal exchange of contracts). I assume that compliance with the condition makes the contract unconditional automatically?


Thanks for following up - but the first response only tells me what I already know I am afraid.




Customer: replied 3 years ago.
Relist: Incomplete answer.

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