Tower block refurb, Ch.H. New Brighton, Wirral DEFAULT Nov 8, 2019 9:48:11 GMT
Post by thedog on Nov 8, 2019 9:48:11 GMT
Impossible to know without sight of the contracts.
I can't recall - was this being sold out of a receivership over the borrower? Was this the "contracts agreed but not signed (??) but here's a deposit anyway" one?
If this is being sold out of receivership then I think sale should be able to go through, albeit perhaps with some delay. In that case FS isn't directly a party to the sale - the Receiver is. That Receiver might want some protection in the form of a confirmation from the FS Administrators that they are comfortable with the sale price, but ultimately if the property's been marketted and this is the best price the receiver has been able to obtain it goes ahead and he distributes funds to the Creditors of the borrowing company which is FS as Security Trustee. It's not really the receiver's problem that that creditor is itself in Administration and that money then flows to us as beneficiaries of that Trust. Eventually....
In that scenario I would think the Receiver currently has possession of the deposit rather than FS.
If the borrower wasn't in a receivorship I would guess buyer's funds are in escrow or in some other way segregated in a ring-fenced account, especially as he's not buying the property off FS as such, but who knows... In that case I'd expect the Administrators to want to pursue the sale in which case goes through as before. Again perhaps with administrative (no pun intended...) delays.
Unless it's explicitly stated in the purchase contract the buyer cannot walk away just because FS are in Admin.
That's the thoery, in practice of course the buyer might be willing to risk losing his deposit if he thinks he can now argue the price down. Or if FS were in some way funding the security/maintenance of the property and that's stopped he might have a right to terminate. Or not have a right to terminate but no longer be willing to go through and lose his deposit (and risk being sued for specific performance). Or a million other things that might or might not be in the contracts....
All usual caveats apply. That's my layman's understanding, this is not professional advice just an opinion, I'm not a lawyer or an Insolvency Practitioner, if anyone wants legal advice hire a lawyer, don't read a Board.