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Alex J.
Alex J., Solicitor
Category: Law
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Experience:  Solicitors 2 years plus PQE
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We, my wife and I, are trying to sell our business property,

Customer Question

We, my wife and I, are trying to sell our business property, a public house. We have an outstanding mortgage which the sale would cover the balance of. We also had some other unsecured borrowing when we bought. There will not be enough funds left to pay this in full, or any other debt we leave with. Now the second lender has acquired a second charge, put a restriction on the land registry and obtained a CCJ against us.
Our buyers cannot proceed with these restrictions in place. Our first lender will not give us any more time to find another buyer, we have already received a final demand. The second lender has now also built up a £10,000 bill for costs, as well as increasing ours. We have no other assets. We have solicitors covering the sale and trying to negotiate settlement. The second lenders solicitor has not offered any kind of compromise. We are basically being given no alternative but to go bankrupt, they have even threatened to prosecute us if we do that citing that we are deliberately devaluing the asset.
Is there anything we can do about them artificially increasing unnecessary legal costs and get the restrictions lifted so we can sell?
Submitted: 2 years ago.
Category: Law
Expert:  Alex J. replied 2 years ago.
Hi,
Thank you for your question and welcome.
My name is ***** ***** I will assist you.
Do you have a solicitor currently in contact with this creditor?
Has the property been valued by an independent valuer?
Kind regards
AJ
Customer: replied 2 years ago.

Yes, our solicitor is in contact with our creditors solicitor.

The property has been valued by 3 independent valuers.

Our mortgage provider received a valuation of between £250,000 and £275,000.

We had 2 provided to us. First between £300,000 and £325,000.

Secondly a more local agent advised to market it for £395,000. We achieved a price of £340,000 after some negotiation.

The property is being bought by a local consortium who have formed a partnership. As they are from the same village the second creditor has suspicions, possibly thinking we are benefiting in some way without declaring so.

Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
If this is a bonafide offer with a third party and the second creditor refuses to allow the sale for the following reasons:
1. Allegations of Fraud
2. Lack of equity.
The first point fraud - this is a very serious allegation making such a claim without evidence is defamatory. Further making a claim at all the burden of proof is on them - if they are threatening to make a criminal complaint then that is their business but that is not grounds to stop your commercial.
Secondly there is a saying in the "Law of Equity" - "One cannot fritter away the equity of redemption". The chargeholder cannot deliberately stop the sale for no good reason when their is a market value to a third party buyer.
Has your solicitor written to them warning they face an equitable claim and defamation claim for this continued approach?
Kind regards
AJ

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