Property problems: Suspicious vendor has to prove bad faith
Q. I read your recent article on purchasers' obligations to fulfil conditions with great interest. Having had my two-storey suburban warehouse on the market for some months, I was relieved to finally get an unconditional offer. The offer was a bit low so I entered into good-natured negotiations with the purchaser, who agreed to increase the offer by $50,000, but made it subject
Sunday, April 18th 2004, 7:47PM
by The Landlord
to getting satisfactory finance.I understood from our discussion (and in today's market) that the finance condition was all but a formality. On the date for confirmation of the finance condition, I was amazed to be told that my purchaser had not obtained finance and was pulling out of the deal. I found this hard to believe given the other property I knew this purchaser owned and the "lifestyle" he enjoyed.
Having asked around, it appeared my purchaser had just found a better deal. I don't think he has honestly been refused finance. What can I do now?
A. The first step is for you to find out exactly why the purchaser has not confirmed the finance condition. As vendor, you are entitled to ask for reasons because the purchaser has a contractual obligation to take all reasonable steps to obtain finance. You should instruct your solicitor to formally request reasons from the purchaser.
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