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F E Smith
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Category: Law
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Experience:  I have been practising for 30 years.
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My housing developer is unable to complete on the original

Resolved Question:

My housing developer is unable to complete on the original date. Can you explain what we are entitled to receive from the housing developer and what will happen if we do not go ahead with the sale with both the developer and in breach of our contract with our buyer?
Thank you for your assistance.
Submitted: 12 months ago.
Category: Law
Expert:  F E Smith replied 12 months ago.

What is the date when completion is supposed to take place and when is completion going to be?

What is the provision in the contract with regard to completion and notice to complete served by you?

Has your solicitor served notice to complete?

If we could have background detail, it would assist.

Customer: replied 12 months ago.
Completion is supposed to take place on 31st August 2016. The new date is unknown but the developer is saying end of September 2016.I can't see any provision about notice to complete.No I don't think notice to complete has been served?The developer agreed a fixed date for completion. They have offered an alternative property which is much smaller. We have a baby who could start crawling/walking anytime now and pets. Our buyer cannot delay for a month. The developer has said they do not intend to offer any compensation. I do not consider this reasonable - can you verify what is reasonable and what other options we have?
Expert:  F E Smith replied 12 months ago.

The problem is that this is a new build property and this will invariably be covered in the terms of the contract absolving the developer of any liability for late completion.

What usually happens is that completion is triggered with a valid NHBC or similar certificate and the seller giving notice to the buyer formally.

Unlike a normal residential purchase, where at exchange, completion date is agreed in most cases, for a new build, it’s common to exchange often on a greenfield with completion at some indefinite period in the future. Usually, in the contract, there will be a long stop date to allow a get out if the matter is going on for years..

It is the seller that drives the completion date but it has to be formal notice, not just an estimate.

So to answer your question completely, it would be necessary to see the terms of the contract.

It is highly likely that you would have no right to compensation. Depending on the terms of the contract, you may be able to withdraw but it is unlikely.

I’m sorry, I wish I could give you better use but it’s one of the problems with newbuild delays. It is quite common.

Incidentally, if you have been trying to get hold of your solicitor today, Friday is never a good day because the majority of completions take place on Friday so that people can move over the weekend.

Can I clarify anything for you?

Customer: replied 12 months ago.
Thank you for your response.We were meant to have a long stop date but this changed to a fixed date.There is no provision of this kind that you mentioned in the contract. It is therefore unclear about what would happen in this circumstance?Legal completionThis will be either a fixed date where the property is built at the date of this contract or by a written notice when it is not.Does this make any difference?What happens if I decide that I do not want to go ahead with the sale because the developer has breached their contract? What are the developers liabilities and what is ours to our buyer?
Expert:  F E Smith replied 12 months ago.

If this is a fixed completion date then you are entitled to compensation/damages.

That would be whatever costs you incur over and above your normal mortgage living costs for the period of the delay. If the developer will not pay up, you are faced with taking the developer to court.

The time to do that is after you move into the property, not before.

I would be surprised if there is not a long stop provision absolving the developer of any liability in circumstances like this but it is essential look at this with the contract in front of you.

Usually, if you don’t go ahead, you would be liable for 10% of the deposit which you would lose. Once again, it depends on what is in the contract.

Can I clarify anything else for you?

Please rate the service positive. It’s an important part of the process by which experts get paid.

We can still exchange emails.

Best wishes.


F E Smith and other Law Specialists are ready to help you
Customer: replied 12 months ago.
No that is all that is required. Thank you for your assistance.