Client instructed HJA in relation to a
purchase of a leasehold property. The price was originally
stated as £385,000. Draft contracts were then received when
the purchase price was stated as £365,000. A transfer was
sent confirming this as the sale price. The seller then
wanted to pull out and the client confirmed he had agreed an
additional £5,000. The seller’s solicitors confirmed the
price was now £370,000. Contracts were exchanged twice at the
price of £370,000 as completion was delayed. It then
transpired the seller’s solicitors had no authority to sign or
exchange contracts and that in fact the price should have been
£390,000 and not £370,000. A Notice to Complete was
served.
On counsel’s advice it seemed that as we were
aware of the mistake we could not rely on this to force specific
performance of the contract.
A breach of warranty claim against the
seller’s solicitors was also weak given we would be benefiting from
our mistake.
However, we sent a pre-action letter to the
seller’s solicitors seeking £7,000 in settlement of the client’s
claim and his consequential losses. Had they disputed this
then the client was unlikely to proceed the claim
Surprising this was paid without question in
full!! The client has now decided to cut his losses and find
another property to buy.
Chun Truong
Dispute Resolution solicitor
Hodge Jones & Allen LLP