Unit 4 Prop - Completion

Question 1

Land - Freehold Covenants

What is a covenant?

Are they capable of being legal interests in land?

Relevant formality?

Answer 1

A promise to do or not do something.

Not capable of being legal interests in land.

In writing and signed.

Question 2

Land - Freehold Covenants

Who are the covenantor and the covenantee?

Answer 2

Covenantor - the person who makes the promise and who has the burden of the covenant

Covenantee - the recipient of the promise and who has the benefit of the covenant.

Question 3

Land - Freehold Covenants

What is annexation (covenants)?

When can it be enforced?

Answer 3

If the land benefitting from the covenant is sold, the covenantee’s successor can enforce the covenant at common law if:
- the covenant touches and concerns the land
- there must have been an intention that the benefit should run with the estate owned by the covenantee;
- the covenantee must have a legal estate in benefitted land
- the buyer of the benefitted land must also take a legal title in the benefitted land

Question 4

Land - Freehold Covenants

Positive vs restrictive covenants?

Answer 4

Positive - requires some effort or expenditure to perform the obligation.

Restrictive - requires no effort or expense.

Question 5

Land - Freehold Covenants

Who are the parties to a contract (covenants)?

Answer 5

The original covenantor and the original covenantee.

Question 6

Land - Freehold Covenants

Can the burden of a covenant (positive or negative) pass at common law?

Answer 6

No.

To enforce a covenant against a successor in title ‘would be to enforce a personal obligation against a person who has not covenanted’.

Question 7

Land - Freehold Covenants

When will the burden of a restrictive covenant pass?

Answer 7

In equity under the doctrine in Tulk v Moxhay, provided the following requirements are satisfied:
- the covenant must be negative (restrictive) in substance;
- the covenant must, at the time of the creation of the covenant, have been made to benefit dominant land retained by the covenantee;
- the covenant must touch and concern the dominant land;
- the covenant must be made with the intent to burden the servient land; and
- the owner of the servient land must have notice of the covenant for it to bind them.

Question 8

Land - Freehold Covenants

Can the covenantee prevent breach of a negative covenant when they have no retained land after sale?

Answer 8

No.

Question 9

Land - Freehold Covenants

What is the test for whether a covenant touches and concerns the land?

Answer 9

• Must benefit only the dominant owner for the time being, so that, if separated from their land, it ceases to be advantageous to them;
• the covenant must affect the nature, quality, mode of user or value of the land of the dominant owner; and
• the covenant must not be expressed to be personal.

Question 10

Land - Freehold Covenants

What 3 devices evolved at the common law to allow positive covenants to be enforced against successors in title?

Answer 10

• Create a lease
• Indemnity covenant
• The doctrine of mutual benefit and burden - Halsall v Brizzell

Question 11

Land - Freehold Covenants

What does the doctrine of mutual benefit and burden (Halsall v Brizzell) dictate?

Answer 11

That a person who wishes to take advantage of a service/facility which benefits their land must also comply with any corresponding obligation.

Question 12

Land - Freehold Covenants

What are the 2 pre-conditions to the doctrine in Halsall v Brizzell?

Answer 12

• There must be a clear correlation between the benefit and the linked burden; and
• the covenantor’s successor in title must have the opportunity to elect whether to take the benefit or to renounce it.

Question 13

Land - Freehold Covenants

What are the 2 rules of the running of the benefit at common law?

Answer 13

• Annexation
• Assignment

Question 14

Land - Freehold Covenants

What are the 3 sets of rules for the running of the benefit in equity?

Answer 14

• Annexation
• Assignment
• Building schemes

Question 15

Land - Freehold Covenants

What are the 3 methods of annexation in equity?

Answer 15

• Express annexation
• Implied annexation
• Statutory annexation

Question 16

Land - Freehold Covenants

What is assignment (running of benefit at common law)?

Requirements for it to be enforceable?

Answer 16

The benefit of a covenant to pass to a successor by express assignment.

Must be in writing and signed by the assignee and written notice of the assignment must be given to the person with the burden of the covenant.

Question 17

Land - Freehold Covenants

Express annexation vs implied annexation vs statutory annexation

Answer 17

Express - covenant should express an intention to benefit a defined piece of land

Implied - the court has been willing to imply annexation where such annexation was obviously intended and it would be an injustice to ignore that intention.

Statutory - the effect of s78 LPA 1925 - automatically annex a freehold covenant to each and every part of the land retained by the covenantee provided the following is met:
- the covenant must have been created after the implementation of the LPA; and
- the covenant must touch and concern the land.

Question 18

Land - Freehold Covenants

How may the burden of a restrictive covenant pass?

Answer 18

Only in equity, not at common law.

When the original covenantee sells the dominant land the successor in title needs to demonstrate that they have the benefit of the covenant in equity.

Question 19

Land - Freehold Covenants

How may the burden of a positive covenant pass?

Answer 19

Neither at common law or in equity when the original covenantor sells the servient land.

The original covenantor remains bound by privity of contract in relation to positive covenants.

A successor in title to the dominant land can pursue the original covenantor for breach of a positive covenant provided that the successor in title can show that the benefit of the positive covenant has passed to them at common law.

Question 20

Land - Freehold Covenants

What are the remedies for breach of a positive covenant? Who can they be sought against?

Will the main remedy always be available?

Answer 20

• Damages - can be sought against the original covenantor by the original covenantee or a successor in title to the original covenantee.
• Specific performance - may be available for breach by original covenantor (but not a successor in title to the original covenantor)

Once the original covenantee has disposed of the land benefitting the covenant - would be unable to demonstrate they have suffered a loss.

Question 21

Land - Freehold Covenants

What is the principal remedy available for breach of a restrictive covenant?

When can it be applied for?

What may a court award instead? When?

Answer 21

INJUNCTION.

No automatic right (within court’s discretion) - can be applied for in anticipation of a breach or in response to an existing breach.

Court will award DAMAGES instead where:
- the injury to the C’s rights are small;
- capable of being estimated of money
- can be adequately compensated by money; and
- it would be oppressive to the respondent to grant an injunction.

Will not be awarded where the C has acted inequitably or has delayed action.

Question 22

Land - Freehold Covenants

What is the purpose of an injunction?

Answer 22

To restrain the breach of a restrictive covenant.

Question 23

Land - Freehold Covenants

What are the methods of removing/limiting the effect of a freehold covenant?

Answer 23

• Express release - restrictive or positive.
• common ownership - restrictive or positive - both servient and dominant land come into common ownership.
• s84 LPA 1925 - only restrictive covs.
• Insurance - only restrictive covs.

Question 24

Land - Freehold Covenants

What is s84 LPA 1925 (discharge of restrictive covenants)?

What conditions must be satisfied?

Answer 24

An application can be made to the Land Chamber of the Upper Tribunal to discharge or modify the covenant in whole or in part.

The burden is on the applicant to satisfy one of the grounds in s84(1) LPA 1925:
- the restrictive covenant was found to be obsolete;
- the restrictive covenant impedes some reasonable use of the land and either:
- it does not secure any practical benefit/value to the persons it should benefit; or
- it is contrary to public interest… and in either case, money will be adequate compensation; or
- that those entitled to the benefit have expressly or impliedly agreed to the discharge; or
- that the discharge will not injure the persons entitled to the benefit.

Question 25

Land - Freehold Covenants What is required for express release from a freehold covenant?

Answer 25

A deed, entered into by the owners of the servient and dominant land.

Question 26

Land - Mortgages What is a mortgage? Who holds the legal estate over mortgaged property?

Answer 26

The lender provides money by way of a loan and, in return, the borrower provides security by creating a mortgage over the property in favour of the lender. The borrower continues to hold the legal estate, subject to the mortgage. The mortgage is a third party right over the land.

Question 27

Land - Mortgages Are mortgages capable of being legal interests in land? Formalties?

Answer 27

Yes. A deed is required to create a legal mortgage in relation to a legal estate.

Question 28

Land - Mortgages What happens when the document used to create a mortgage lacks the requirements of a deed?

Answer 28

Equity may intervene and recognise an equitable mortgage under the principle of Walsh v Lonsdale.

Question 29

Land - Mortgages Can a mortgage be created over an equitable interest? Formalities?

Answer 29

Yes, must be in writing and signed.

Question 30

Land - Mortgages What are the remedies available to a mortgagee (legal mortgage)? Will any of these remedies being the mortgage to an end?

Answer 30

* Possession * The power of sale * Debt action * Appointing a receiver * Foreclosure Only exercise of THE POWER OF SALE and FORECLOSURE will bring the mortgage to an end.

Question 31

Land - Mortgages Does the borrower need to be in default for the lender to exercise its right to possession? What does possession mean?

Answer 31

The borrower does not need to be in default for the lender to exercise its right to possession. Possession means either: - taking physical possession; or - where the property is being let, directing that the tenants pay their rent to the lender (rather than the borrower).

Question 32

Land - Mortgages When is a court order for possession required?

Answer 32

If a lender cannot take possession without breach of s6 Criminal Law Act, a court order for possession is required. s6 - The lender cannot use/threaten violence towards anyone know to be present on the property in order to gain possession.

Question 33

Land - Mortgages When must a lender comply with pre-action protocol for possession?

Answer 33

Where the property is residential.

Question 34

Land - Mortgages What statute can the borrower use if the lender has started procession proceedings? When does the statute apply? When will the court not exercise its discretion?

Answer 34

s36 Administration of Justice Act (AJA)1970 - allows the borrower to ask the court to exercise discretion to: - adjourn proceedings; or - on making an order for possession, suspend execution, or postpone the date for possession. Applies when: - the lender has started possession proceedings; - the property includes a dwelling-house; and - the borrower is likely within a reasonable period to pay any sums due under the mortgage. The court will not exercise its discretion unless the borrower can provide a detailed financial plan demonstrating that they can pay both the mortgage instalments as they fall due and any arrears.

Question 35

Land - Mortgages How can the lender use income produced by a property (possession)? What must a lender do as part of his strict duty to account (income producing property)?

Answer 35

The lender can use the income to pay the debt owed. However, the lender must: - account to the borrower for any sum beyond that which is due to them; and - manage the property with due diligence, accounting to the borrower for any income that should have been received had the property been managed correctly.

Question 36

Land - Mortgages To be exercised, the power of sale must...

Answer 36

* exist; * have arisen; and * become exercisable.

Question 37

Land - Mortgages When will the power of sale exist? Have arisen? Become exercisable?

Answer 37

Exists - either expressly stated within the mortgage deed or implied into every legal mortgage (provided that power has not been excluded) Have arise - mortgage money must be due (legal date for redemption passed or any instalment of the mortgage money due under an instalment mortgage) Be exercisable - will either be set out expressly in the mortgage deed or the lender will have to rely on one of the elements ins103 LPA 1925: (i) the lender has given the borrower notice to repay the loan amount and the borrower has not paid the sum for 3 months after such notice; (ii) interest is in arrears for 2 months after becoming due; or (iii) the borrower has breached a term of the mortgage (other than the covenant to pay the mortgage money or the interest thereon).

Question 38

Land - Mortgages Lender's duties on sale? Are lenders under an obligation to delay sale to maximise profit?

Answer 38

Must: - act in good faith and not cheat borrowers; and - take reasonable care to obtain the true market value of the property at the date of sale. No.

Question 39

Land - Mortgages What is the equity of redemption?

Answer 39

The right (in equity) for the borrower to recover the assets subject to the mortgage upon repayment of the debt. If the property is worth more than the sum owed, the balance, payable to the borrower, represents the equity of redemption.

Question 39

Land - Mortgages What happens if the lender fails to obtain the true value of the property (equity of redemption)? Who is the onus of proof on?

Answer 39

If the lender fails to obtain the true value, it must account to the borrower (and all others with an interest in the equity of redemption) for the difference. The onus of proof is on the borrower to show that there has been a breach of the duty of care.

Question 40

Land - Mortgages When a lender exercises its power of sale, the buyer of the property takes the estate of the borrower subject to/free of what?

Answer 40

* free of any estates/interests (including other mortgages) which the selling lender took priority over; but * subject to any estates and interests which took priority over the selling lender.

Question 41

Land - Mortgages How should the proceeds of sale be distributed?

Answer 41

(a) The costs of redeeming any prior mortgages; (b) the lender's expenses of sale; (c) the lender's own mortgage; and (d) the balance (if any) to the person(s) entitled to the equity of redemption.

Question 42

Land - Mortgages When will a lender typically appoint a receiver? When does the power arise? How must the receiver be appointed?

Answer 42

Will usually appoint a receiver if the property subject to the mortgage is producing income. The power must exist, have arisen, and be exercisable (like power of sale). The receiver must be appointed in writing and it is for the lender to decide who to appoint.

Question 43

Land - Mortgages What must have passed for debt action to be taken? Time limit to recover debt?

Answer 43

The legal date for redemption must have passed before action can be taken. * 6 years for the recovery of interest; and * 12 years for the recovery of capital.

Question 44

Land - Mortgages What does a receiver have the power to do? Does the LPA grant the receiver power to sell the property?

Answer 44

To demand and receive income from the property. The LPA 1925 does not grant the receiver any power to sell the property. The terms of the mortgage will usually extend the powers of the receiver to include a power to sell the property.

Question 45

Land - Mortgages Who is the receiver deemed to be an agent to? Who is solely responsible for the acts of the receiver?

Answer 45

Deemed to be an agent of the borrower. The borrower is solely responsible for the acts of the receiver.

Question 46

Land - Mortgages What are the duties of a receiver?

Answer 46

* To ensure that their personal interests do not conflict with their role as receiver; * To act in good faith in the course of their appointment; * To act with reasonable competence (depends on the nature of the particular property); * To take reasonable care to obtain the true market value of the property at the date of sale; and * the receiver may take steps to increase the value of the property.

Question 47

Land - Mortgages When is foreclosure available?

Answer 47

By an application to the High Court once the legal date for redemption has passed?

Question 48

Land - Mortgages What are the 2 stages of foreclosure?

Answer 48

* Foreclosure Nisi - directing the preparation of accounts of what is owed followed by a period of (usually) 6 months in which to pay; and * Foreclosure Absolute - has the effect of vesting title to the property in the lender and extinguishing the equity of redemption held by the borrower.

Question 49

Land - Mortgages (Foreclosure) What happens if the property is worth more/less than the sum owed?

Answer 49

If worth more, the lender is entitled to keep the surplus. If worth less, the borrower is released from liability.

Question 50

Land - Mortgages How is the borrower protected from foreclosure?

Answer 50

* The discretion of the court to re-open foreclosure proceedings, in exceptional circumstances, even after the foreclosure absolute order; * where the property is a dwelling house, the borrower may seek to adjourn the foreclosure proceedings by means of an application under the AJA 1970 (s36 like for possession proceedings); or * an application to court for a judicial sale under s91(2) LPA 1925. This will preserve the equity of redemption in favour of the borrower. Such an application can be made by any person with an interest in the equity of redemption.

Question 51

Property - Completion Under s52 LPA 1925, what is the formality required for the transfer of a legal estate in land?

Answer 51

Deed.

Question 52

Land - Mortgages What are the requirements for a deed to be valid in law?

Answer 52

* Make it clear that it is a deed; * be signed by the parties; and * be delivered.

Question 53

Land - Mortgages How must a deed be executed by an individual vs a company?

Answer 53

Private individual - signature must be witnessed by an independent witness. Company; (a) using the company seal in accordance with the articles of association (b) having it signed by a director and the secretary, or by 2 directors of the company, provided that the deed is expressed to be executed by the company (c) having it signed by a single director in the presence of a witness who attests that signature.

Question 54

Land - Mortgages Drafting - How would the execution clause of a deed for a company read if executed by: (a) company seal (b) signed by director and secretary, or 2 directors (expressed to be executed by company) (c) signed by a single director in presence of attesting witness

Answer 54

a) Executed as a deed by affixing the common seal of [name of company] in the presence of: b) Executed as a deed by [name of company] acting by [a director and its secretary] [two directors] c) Executed as a deed by [name of company] acting by [a director] in the presence of: [signature of witness] Name Address

Question 55

Land - Mortgages Who will execute the transfer deed?

Answer 55

The seller will always execute the transfer deed in order to transfer the land. The buyer will also do so if the buyer is entering into an obligation or making a declaration in the TR1.

Question 56

Land - Mortgages When is a deed presumed to be delivered? Can this be rebutted?

Answer 56

On execution. Can be rebutted by contrary intention.

Question 57

Land - Mortgages Which deed is used to transfer the whole of registered title?

Answer 57

Land Registry Form TR1.

Question 58

Land - Mortgages (Drafting) When will the transfer deed be dated?

Answer 58

Upon completion.

Question 59

Land - Mortgages How should the purchase price be written on the transfer deed? Give an example where the amount is £380,000.

Answer 59

In figures as well as words. "Three hundred and eight thousand pounds (£380,000)"

Question 60

Land - Mortgages How will the 'Transferor'/'Transferee section of TR1 be filled if the transferor is: - an individual; or - a UK incorporated company/LLP?

Answer 60

Individual - Full name(s) of all the persons transferring the property. UK incorporated company/LLP - Registered number of company or LLP including any prefix

Question 61

Land - Mortgages Who carries out pre-completion searches? When?

Answer 61

Generally carried out by the buyer's solicitor. Should be made as close to the completion date as possible.

Question 62

Land - Mortgages What are the 4 reasons pre-completion searches are carried out?

Answer 62

1. To make sure that the seller has not further encumbered the title since investigation of title took place 2. To check the financial circumstances of the borrower when acting for the lender 3. To gain priority for the buyer, and the lender, over anyone else making an application before the buyer applies to register the change of ownership at the Land Registry 4. If the seller is a company, to check that the company has not gone into liquidation before the balance of he purchase price is paid over on completion

Question 63

Land - Mortgages What pre-completion searches should be made for registered land? What will the search cover? What will it confer on the applicant?

Answer 63

A Land Registry search should be made against the title number (Form OS1)(Form OS2 for part). The search result will reveal any new entry made since the 'search from' date. It will confer on the applicant a 'priority period' of 30 working days from the date of the search result. The priority period provider protection against any subsequent entries - will take free of any such entries, provided they submit their application for registration by 12 noon on the last day of the priority period.

Question 64

Land - Mortgages What is the 'search from' date?

Answer 64

The date on which the official copies were produced.

Question 65

Land - Mortgages When will the application for Land Registry search not be made in the name of the buyer? Why?

Answer 65

Will be made in the name of the lender if the buyer is financing the purchase of the property with the aid of a mortgage. A search made on behalf of the buyer will not protect the lender.

Question 66

Land - Mortgages (Drafting) How will the 'Registered proprietor/Applicant for first registration' section be filled on Form OS1?

Answer 66

"Surname/Company Name: Forename(s): Surname/Company Name: Forename(s)" If there are more than two persons, enter the first two only.

Question 67

Land - Mortgages (Drafting) How will the 'Application and search from date' box be filled? E.g. if the date is 30th April 202x.

Answer 67

"30.04.202x"

Question 68

Land - Mortgages What form is used for a pre-completion search of unregistered land? What priority period conferred? When will a Land Charges search need to be repeated? Against who?

Answer 68

Land Charges search made form K15 against owner's names. Confers a priority period of 15 working days from the date of the result, during which time the searcher will take free of any entries made on the register between the date of the search and he date of completion. Will normally need to be repeated against the current seller's name unless the transaction can be completed within the 15 working day priority period conferred by the pre-exchange search. Will not need to search again against the names of the previous owners as no entries can have been registered against them after they parted.

Question 69

Land - Mortgages How will a lender check for the buyer's solvency? (registered vs unregistered)

Answer 69

Apply on behalf of the lender for a land charges search against the buyer. If the title is registered - the solicitor will apply for a land charges search against the name of the buyer (as well as carrying our the pre-completion Land Registry search against the property's title number) + Bankruptcy Only search using form K16. If title is unregistered - solicitor will already be making a land charges search against the seller, so the name of the buyer will be added to the name(s) to be searched against on form k15.

Question 70

Land - Mortgages What additional search should a solicitor acting for the buyer purchasing from a company carry out? What will it reveal? Will it confer a priority period?

Answer 70

A company search prior to completion. Will reveal whether the seller is still in existence, whether it is solvent, and whether it has created any fixed or floating charges. Has no priority period - should be carried out as close as possible to the day of completion.

Question 71

Land - Mortgages Outline bankruptcy search against an individual seller.

Answer 71

Unregistered land - Form K15 search against the seller as estate owner will reveal any entries relating to bankruptcy. Registered land - Not usually necessary as where no notice or restriction relating to the bankruptcy appears on the registered title, a buyer for value acting in good faith without notice of the bankruptcy petition or adjudication will take good title from the bankrupt seller.

Question 72

Land - Mortgages What is the significance of FORM TA13 Completion?

Answer 72

The form used for the buyer and seller to agree practicalities for completion.

Question 73

Land - Mortgages If the buyer is financing the purchase with the aid of a mortgage, what will the lender expect to receiver before releasing?

Answer 73

* A certificate of title to confirm that the property is adequate security for the loan being advanced; * a solvency search against the borrowers; * a clear OS14 in the name of the lender; and * an executed but not completed mortgage deed.

Question 74

Land - Mortgages What will the buyer's solicitor do on completion? How do the SC and SCPC require completion money to be paid? What will the seller's solicitor do on receipt of completion money? What will happen then?

Answer 74

At completion, the buyer's solicitor will send the balance of the purchase price and release the deposit paid on exchange to the seller. SC and SCPC require the completion money to be paid by direct transfer/electronic means in cleared funds from an account held in the name of a conveyancer at a clearing bank. The seller's solicitor will complete the transaction by dating the TR1. Once the TR1 has been dated, the lender's solicitor will need to date the mortgage deed.

Question 75

Land - Mortgages When does legal title pass (registered vs unregistered land)?

Answer 75

Unregistered - on completion. Registered - not until the buyer is registered at the Land Registry as proprietor of the land.

Question 76

Land - Mortgages What are the post-completion steps?

Answer 76

* Discharge of the seller's mortgage * SDLT/LTT * Registration of new charge at companies house * Land Registry applications

Question 77

Land - Mortgages When must SDLT/LTT be paid?

Answer 77

The seller's solicitor will send the TR1 to the buyer's solicitor who must then arrange for SDLT/LTT to be paid. SDLT - must be paid to HMRC within 14 days of completion. LTT - must be paid to the Welsh Revenue Authority (WRA) within 30 days of completion.

Question 78

Land - Mortgages If the buyer is a company who purchased with the aid of a mortgage, when must the lender's solicitor register the new charge at Companies House?

Answer 78

Within 21 days of its creation. Time limit cannot be extended without a court order.

Question 79

Land - Mortgages What will the buyer's solicitors need to do after SDLT/LTT has been paid?

Answer 79

Apply to have the buyer registered as the registered proprietor of the land in the title.

Question 80

Land - Mortgages When must the application to have the buyer registered as the registered proprietor be made? registered property vs unregistered property

Answer 80

Registered property - before the expiry of the priority period of the OS1 search. Unregistered property - application for first registration of title must be made within 2 months of completion of the transaction.

Question 81

Land - Mortgages What is the completion date provided by the SC/SCPC? When is money due on completion to be paid? What happens if it isn't paid then? Can the parties agree to vary completion time?

Answer 81

20 working days after the date of the contract. Before 2pm on the day of completion and if it is not, completion is to be treated as taking place on the next working day as a result of buyer's default. Yes, they can agree to in the contract.

Question 82

Land - Mortgages (CONTRACTUAL COMPENSATON) Under the SC and SCPC, who can be asked to pay compensation for delayed completion? How is the compensation calculated? What if the non-paying party was also at fault for some of that period?

Answer 82

SC - both the buyer and the seller can be asked to pay this compensation SCPC - only the buyer can be required to pay compensation Calculated at the Contract rate specified in the contract, on the balance of the purchase price, less any deposit paid for the period between the contractual completion date and the date of actual completion. Those days that the non-paying party is at fault for are ignored.

Question 83

Land - Mortgages What are the remedies for delayed completion?

Answer 83

* Contractual compensation * Common law damages * Notice to complete * Rescission

Question 84

Land - Mortgages How do common law damages for delayed completion arise? How will damages be assessed?

Answer 84

Failure to complete on the contractual completion date is breach of contract and the seller could make a claim for breach of contract under normal contractual principles. Will be assessed under Hadley v Baxendale, with the measure being that of putting the C in the position they would have been had the contract been correctly performed.

Question 85

Land - Mortgages Does the fact that the seller received contractual compensation prevent them from claiming common law damages (delayed completion)?

Answer 85

No, does not prevent the seller from claiming damages for extra losses for breach of contract in the normal way.

Question 86

Land - Mortgages When may parties consider serving a notice to complete (delayed completion)?

Answer 86

Where it appears that the delay in completion is not likely to be resolved quickly, and either party is ready, willing and able to complete themselves.

Question 87

Land - Mortgages (Delayed completion) When can a notice to complete be served? What happens once served? What if the defaulting party was the seller vs the buyer and the contract is rescinded? Can the non-defaulting party claim damages?

Answer 87

Only after the contractual completion time on the contractual completion date. Once served, the notice to complete makes time of the essence and gives the other party 10 working days to complete. If the defaulting party fails to complete within 10 working days, then the party who served the notice to complete can rescind the contract. If the contract is rescinded and the defaulting party was the buyer, the seller is able to forfeit the deposit. If the defaulting party was the seller, then the seller must repay the deposit to the buyer. Yes, the non-defaulting party can also claim damages for any losses they suffer as a result of the other's default.

Question 88

Land - Mortgages In which circumstances do contracts incorporated the SC and SCPC provide for rescission? When will it be allowed?

Answer 88

Where a party has failed to comply with a notice to complete. Will only be allowed where: - the seller's error/omission results from fraud, recklessness, or - the buyer would be obliged to accept a property differing substantially from what the error/omission had led them to expect. Less serious misrepresentations only entitle buyer to damages.