Ajax condos . If you can’t get a loan, you still lose money to the real estate developer! One possibility is that the value of a house (pre-construction house) that has not yet begun construction falls below the price of the purchase contract and the buyer cannot get enough mortgage loans to complete the deal.
At the same time, buyers are unable to sell their existing houses and are therefore unable to obtain sufficient funds to pay for the down payment of the new housing estates.
Several of my clients are in this situation, and some of my colleagues’ clients have the same problem. Sometimes, the builder will negotiate the solution with the buyer. These options may include delaying transactions, price adjustments, or giving up deposits in the event of mutual concessions, and paying large amounts of cash to builders. However, sometimes the political leaders will go to court.
Builder Forest Hill Homes Ltd. A recent lawsuit was filed against two buyers, ou Peiming (Peimian Ou, transliterated) and Wu Ying (Ying Wu, transliterated). Ou Peiming and Wu Ying reached a sale and purchase agreement with the builder Forest Hill Homes in November 2016 to buy a house to be built in Markham. The purchase price, including the extra charge, is 1729820.99 yuan.
On the day of the transaction, the builders were ready, but the buyers did not have enough money. The builder filed a complaint with the buyer and made a “summary judgment” (Summary Judgment) recommendation in July. The so-called “summary judgment” means that the court makes a decision based on indisputable facts without formal trial procedure.
Ou Peiming and Wu Ying rejected the builder’s claim based on the following four points:
- Due to the “sharp and unforeseen decline in the real estate market”, the contract could not be fulfilled.
two。. Builders procrastinate excessively.
- The builder’s sales agent has made misrepresentations; and.
- The builder’s sales agent asked the buyer to pay bribes. Judge Ed Morgan pointed out in his decision that there was no part of the law or contract that prevented either party from performing the contract in accordance with the agreement.
On the question of “delay”, the contract allows builders to postpone the transaction date to January 18, 2019. The house will be available for sale on October 22, 2018, so there is no “undue delay”.
As for “misrepresentation”, the buyer claimed that the sales representative described the transaction as a “once-in-a-lifetime opportunity” and that it was a misrepresentation. Judge Morgan pointed out that the seller’s sales proposal used the “complete Agreement” clause (entire agreement clause), meaning that the buyer could not rely on prior statements to make a purchase decision.
Finally, ou Peiming and Wu Ying claimed that they paid bribes to the broker in order to jump the queue and sign the sale and purchase agreement as soon as possible. Judge Morgan pointed out in the judgment that the person who paid the bribe had no right to terminate the contract. The court finally ruled in favour of the builder, who was awarded a compensation of $544308 (plus interest) and legal costs of $9000. The amount of compensation is calculated on the assumption that the builder is entitled if there is no breach of contract by the buyer.
For buyers who have not started construction, if there is still a long time to go before the date of the transaction, they should consider that the value of the property may rise or fall, and they must set aside sufficient funds to complete the transaction.