Why Property Developers Fear "Contract Killers"
OPINION
by Tim O’Dwyer M.A., LL.B
Solicitor
Consumer Advocate
watchdog@argonautlegal.com.au
After many years as a conveyancing solicitor I identified three immutable rules of real estate. The first is that salespersons move fast. The second is that solicitors move slowly. And the third, the reason for the first two, is that buyers and sellers alike can change their minds.
When real estate consumers – particularly buyers – change their minds part-way through contracts, their conveyancing solicitors are expected to change pace and play a different role. Suddenly our clients want us to be “contract killers.”
“How fast can you get us out?” ask clients, having second thoughts about yet-to-be-settled contracts. More buyers than sellers in these circumstances essentially want their lawyers to help them escape contractual obligations by locating and taking advantage of available loop-holes.
No worries if solicitors’ cold-footed residential buyer clients are within their 5 days cooling-off period. Simply pull the plug , have your clients pay the cooling-off penalty and everything is rosy. Tough luck for cold-footed sellers with no comparable rights at law!
What if the cooling-off period has already passed (or was waived initially), and there are no obvious ways out?
Many conveyancing solicitors, who prefer to remain comfotable “contract completers” (and not upset sources of referred clients), will decline the challenge. Anxious clients are often then passed to professional “contract killers”.
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2 Comments
Hi Tim,
Yes, it’s absolutely stupid of any lender not to disclose their valuation to a buyer – especially on a collateral loan.
So therefore, we not only have dodgy practices happening on the agent’s side but also, on the banks side.
What is the solution to all this nonsense – quite simply independent valuations on the sellers side and bank valuations on the purchaser’s side with full disclosure !
We needen’t forget either, the problems on the vendor’s side are just as bad. Unfortunatelty, full disclosure on a bank valuation doesn’t stop agent’s or vendor’s from engaging in the illegal practice of misleading two-tier pricing, or two-tier marketing – this is a widespread problem that has gone on for years and must be also stopped.
Within days of the newspaper report (mentioned above) of the millionaire’s efforts to get out of his Gold Coast penthouse contract the development company was placed in the hands of receivers:
http://www.theaustralian.com.au/business/property/legal-action-over-failed-gold-coast-twin-towers/story-e6frg9gx-1225972948922