290 thoughts on “Dealing with property auction issues”
Hi, I won a bid on a property in online auction of 8th Dec 2022. Just before the completion date of 19th January 2023, I found through level 2 survey report that the property is not mortgageable and being built on non-traditional standard. I aborted the purchase 18th January 2023, due this issue, but my deposit was rescinded. Do I have any chance of getting my money back?
Thank you for your comment and we are sorry to hear of these circumstances.
From what you have written it sounds unlikely that you would be able to recover your deposit. This will, however, depend on the terms and conditions that you agreed. In most conveyancing transactions, whether by auction or otherwise, it is for the buyer to ensure that they are content with the property that they are purchasing and that their finances are in place accordingly. We do regularly see issues such as yours where a mortgage lender has made a conditional offer and then withdraws that offer on discovering that the property is not in a condition that they would be prepared to lend against. In essence it is hard to say that the seller is to blame for the current circumstances and of course in any claim it is necessary to prove that the other party is at fault.
Hi Mark, Thank you so much for the response. I wanted to buy the property cash not mortgage. However See below Overall opinion of the property based on the Home buyer Level 2 survey report: “We must firstly highlight that this property is of non traditional construction, utilising a steel framework concealed by external brick finishes and internal finishes beneath an externally tiled roof. The type of non traditional construction cannot be definitively confirmed without disruptive investigation which is beyond the scope of this report. It must be brought to your attention however that due to the property being of non traditional construction the mortgageability and saleability of the house may be affected as some mortgage lenders would not find this acceptable thus reducing the suitability of this property for mortgage security and thus restrict saleability. You must satisfy yourself that this will not impact your decision to purchase the property prior to your legal commitment to purchase. This is essential.”
So after I had this information I aborted because this issue was not mentioned anywhere on the auction pack. Is this something I should pursue to recover my deposit?
We are not able to provide specific advice on our website, just general guidance as to the law. There is no general duty on a seller to provide information in relation to the property. The basic position is that it is up to the buyer to satisfy themselves. There is some limited case law that suggests that a seller is obliged to identify title defects, but this would not extend to the construction of a property, which would be a matter for the buyer’s surveyor.
If a seller has not made a misrepresentation, and merely stayed silent on a particular issue that is later discovered, it cannot be said that the buyer relied on anything the seller told them. In such circumstances, the prospect of there being a misrepresentation claim with any prospect of success is quite low.
You may have some recourse if you can identify the type of non-traditional property. If it was designated as ‘defective’ under the 1985 act, there may be recourse as that is a legal position affecting the property which was not disclosed to you.
I bought a property through a modern method of auction, paid a reservation fee. During legals, it came to light that there are several charges on the property and it could not be sold, therefore the seller pulled out. Do I have any right to get the reservation fee back?
I would like some advice on a property I have purchased through an online auction.
I believe they have misrepresented the property on the basis of cutting a part of the land from the garden and also cutting the garage from the property sale. As part of the house viewing we were shown the garage as part of the house as well and there are no clear indications in the auction pack to state there is retained land by the seller.
Secondly the 6 week mark has now passed and the seller has not completed as there is an issue with the Grant of Probate. I wanted to ask if I have grounds of misrepresentation for this case and is there anything I can do about the significant delay I have been put through when I was promised the 17/08/23 as the completion date.
Much will depend on the terms and conditions that you agreed to when bidding on the property and whether or not you have contractually agreed not to pursue a claim for misrepresentation.
On the assumption that the terms and conditions are in your favour (or otherwise do not apply by reason of fraud, which is a complicated point) a claim for misrepresentation may arise if you have been expressly misled as to what it was that you were purchasing.
Often the Standard Conditions of Sale prepared by The Law Society will also be incorporated into a contract for the sale of land. These tend to provide a remedy if there is a material difference between the description of the property included in the contract and as represented to you.
As for the grant of probate, or the lack thereof, this is unlikely to give rise to any sort of claim apart from a breach of contract claim, but again it would be necessary to see the contractual terms.
If you would like to consider instructing us, please do feel free to get in touch.
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Hi, I won a bid on a property in online auction of 8th Dec 2022. Just before the completion date of 19th January 2023, I found through level 2 survey report that the property is not mortgageable and being built on non-traditional standard. I aborted the purchase 18th January 2023, due this issue, but my deposit was rescinded. Do I have any chance of getting my money back?
Thank you for your comment and we are sorry to hear of these circumstances.
From what you have written it sounds unlikely that you would be able to recover your deposit. This will, however, depend on the terms and conditions that you agreed. In most conveyancing transactions, whether by auction or otherwise, it is for the buyer to ensure that they are content with the property that they are purchasing and that their finances are in place accordingly. We do regularly see issues such as yours where a mortgage lender has made a conditional offer and then withdraws that offer on discovering that the property is not in a condition that they would be prepared to lend against. In essence it is hard to say that the seller is to blame for the current circumstances and of course in any claim it is necessary to prove that the other party is at fault.
Hi Mark, Thank you so much for the response. I wanted to buy the property cash not mortgage. However See below Overall opinion of the property based on the Home buyer Level 2 survey report:
“We must firstly highlight that this property is of non traditional construction, utilising a steel framework concealed by external brick finishes and internal finishes beneath an externally tiled roof. The type of non traditional construction cannot be definitively confirmed without disruptive investigation which is beyond the scope of this report. It must be brought to your attention however that due to the property being of non traditional construction the mortgageability and saleability of the house may be affected as some mortgage lenders would not find this acceptable thus reducing the suitability of this property for mortgage security and thus restrict saleability. You must satisfy yourself that this will not impact your decision to purchase the property prior to your legal commitment to purchase. This is essential.”
So after I had this information I aborted because this issue was not mentioned anywhere on the auction pack.
Is this something I should pursue to recover my deposit?
Thank you for your further comment.
We are not able to provide specific advice on our website, just general guidance as to the law. There is no general duty on a seller to provide information in relation to the property. The basic position is that it is up to the buyer to satisfy themselves. There is some limited case law that suggests that a seller is obliged to identify title defects, but this would not extend to the construction of a property, which would be a matter for the buyer’s surveyor.
If a seller has not made a misrepresentation, and merely stayed silent on a particular issue that is later discovered, it cannot be said that the buyer relied on anything the seller told them. In such circumstances, the prospect of there being a misrepresentation claim with any prospect of success is quite low.
You may have some recourse if you can identify the type of non-traditional property. If it was designated as ‘defective’ under the 1985 act, there may be recourse as that is a legal position affecting the property which was not disclosed to you.
I bought a property through a modern method of auction, paid a reservation fee. During legals, it came to light that there are several charges on the property and it could not be sold, therefore the seller pulled out. Do I have any right to get the reservation fee back?
Whether or not you have any right to recover the reservation fee will depend on the terms and conditions that you have entered into.
It is probably fair to say that the prospect is quite low, but not impossible.
Hello
I would like some advice on a property I have purchased through an online auction.
I believe they have misrepresented the property on the basis of cutting a part of the land from the garden and also cutting the garage from the property sale. As part of the house viewing we were shown the garage as part of the house as well and there are no clear indications in the auction pack to state there is retained land by the seller.
Secondly the 6 week mark has now passed and the seller has not completed as there is an issue with the Grant of Probate. I wanted to ask if I have grounds of misrepresentation for this case and is there anything I can do about the significant delay I have been put through when I was promised the 17/08/23 as the completion date.
Thank you
Thank you for your comment.
Much will depend on the terms and conditions that you agreed to when bidding on the property and whether or not you have contractually agreed not to pursue a claim for misrepresentation.
On the assumption that the terms and conditions are in your favour (or otherwise do not apply by reason of fraud, which is a complicated point) a claim for misrepresentation may arise if you have been expressly misled as to what it was that you were purchasing.
Often the Standard Conditions of Sale prepared by The Law Society will also be incorporated into a contract for the sale of land. These tend to provide a remedy if there is a material difference between the description of the property included in the contract and as represented to you.
As for the grant of probate, or the lack thereof, this is unlikely to give rise to any sort of claim apart from a breach of contract claim, but again it would be necessary to see the contractual terms.
If you would like to consider instructing us, please do feel free to get in touch.