Worth pursuing?

[willbish]

 The matter relates to a property I purchased last year. The house sale was completed on 6 Jan 2017, there was a clause in the contract:

 

"On completion the Buyer will pay to the Seller’s solicitor the sum of £16,000 to be retained as stakeholder for a period of one year. If during the period of one year commencing from the date of completion the buyer is granted planning permission to convert the property into a 4 bedroom dwelling then the said sum of £16,000 (with accrued interest) shall be paid to the Seller in full. If the Buyer is not granted planning permission by the expiry of one year from the date of completion to convert the property to a 4 bedroom dwelling then the retained amount £16,000 (with accrued interest) shall be paid to the Seller.  The Buyer will use reasonable endeavours to obtain planning permission to convert the property to a 4 bed dwelling and will provide to the Seller a copy of any application and planning permission received within that period"

 

This clause was written because late in the sale process I commissioned an initial ecology scoping survey as a prerequisite for submitting a planning app

Bats were found using the attic so I tried to negotiate the price down, arguing that because of the presence of bats it was unlikely that I would be unable to convert the property into a 4-bed (The limitations of a semi detached, maintaining ridge height and the need to incorporate a bat roost in the loft space) The sellers did not agree but proposed retaining £16k as a sort of insurance.

 

Now that the one year period is up, the sellers solicitor is of the opinion that because planning permission has been approved the monies should be transferred to the seller. I dispute this because although planning permission has been approved, we are still working towards gaining ecological consent. A European Protected Species Licence (EPSL) from Natural England is currently being processed. If Natural England require we will need to make changes to our building plans to further accommodate the bats. Any changes to building plans will require consultation and permission from the local planning authority. I believe the planning permission is still an ongoing process and full permission has not yet been granted. 

 

I appreciate that to the letter of the clause, yes planning permission has been granted. However the spirit of the clause (is there such a legal term?) was such that the permission would include planning and ecological consent. In fact the draft of the contract stated:

 

"If the buyer obtains the necessary planning and ecological consents to convert the property into a four bed dwelling then my client will be entitled to receive the £21,000 if not this amount will be returned to the buyer in full"

 

I did not realise the term ecological consent had been removed until I have started investigating further. 

 

The seller is a large organisation who I don't want to name, they own hundreds of properties and their solicitor ranks very highly on the legal 500. It feels a bit David and Goliath...

 

My solicitor has said she will represent me if I want to further the dispute but she feels, after consultation with other partners in her practice, that I would not be successful. I get the impression she is not up for the challenge and would prefer to be doing straight forward conveyancing work instead. 

 

An equally match Legal 500 firm have had a little look, are interested but want £2k upfront to start. ?

 

I may have sufficient grounds to write my solicitor a formal complaint with the intention of involving the legal ombudsman but am a little reluctant to pursue this route as I don't think it will be successful and will burn bridges. 

 

Any other options besides forget the £16k and move on? ?

 

[ProDave]

I presume you bought it with the intention of extending it so agreed to the uplift clause and expected to pay the uplift?

 

What matters is the wording of what you actually signed nor some previous draft copy.

[pudding]

24 minutes ago, willbish said:

If during the period of one year commencing from the date of completion the buyer is granted planning permission to convert the property into a 4 bedroom dwelling then the said sum of £16,000 (with accrued interest) shall be paid to the Seller in full. If the Buyer is not granted planning permission by the expiry of one year from the date of completion to convert the property to a 4 bedroom dwelling then the retained amount £16,000 (with accrued interest) shall be paid to the Seller.

 

If this is taken directly from the contract and you've not mistyped it, it says you pay the seller either way, planning permission granted or not?!

[willbish]

2 minutes ago, pudding said:

If this is taken directly from the contract and you've not mistyped it, it says you pay the seller either way, planning permission granted or not?!

 

Another reason why I feel my solicitor may be somewhat negligent. Fortunately I spotted that same error and had it amended. The clause was written and signed so quickly.

We were under pressure to exchange before Xmas 16, my solicitor sent through the contract on her last morning before Xmas break, she stated that they were finishing for lunch at 1pm and it needed signing.. 

To me that sounds like poor practice.

 

[willbish]

17 minutes ago, ProDave said:

I presume you bought it with the intention of extending it so agreed to the uplift clause and expected to pay the uplift?

 

I hoped that the permissions would be granted within the one year time frame.

I tried my best to move everything forward as quick as possible as I want to move out of overpriced rental accommodation. 

The 16k goes some way to offset the extra time renting because of the bats.

 

But yes if I couldn't afford to extend and lose the 16k I would not have gone ahead

[RichS]

49 minutes ago, willbish said:

If the buyer obtains the necessary planning and ecological consents to convert the property into a four bed dwelling then my client will be entitled to receive the £21,000 if not this amount will be returned to the buyer in full"

 

It reads to me as though they have changed the wording believing that you may get PP but struggle with the ecological side, hence knock 5k off and be assured of the 16k.

[Jml]

Sometimes house insurance cover has legal expenses cover (sometimes at extra cost), may be worth seeing if you have that and if it would cover legal fees.

[willbish]

@RichS I refused 21k retention and managed to negotiate 5k off sale price.

 

@Jml thanks, will have a look