Gazumped on day of exchange

[Bushyandbright]

I'm writing this post on behalf of a friend who is distraught this evening. Her and her husband had their offer accepted on a house in January that had come back on the market following a collapse in a chain. An offer was made an accepted on their property too at the same time; their buyers are living with family and the house they were buying was empty, so a small chain.
Today she received a call from the vendor's solicitor to say that the house has now been sold (and contracts exchanged) with the previous buyer, despite my friend's solicitor now having completed searches and ready to exchange. It turns out that the previous buyer went back to the agent to say that she was now in a position to proceed with the purchase, but the agent told her it was days away from exchange. Having previously corresponded with the vendor's solicitor, she then spoke to them and the vendor accepted her offer and exchanged immediately. Presumably she had already done searches etc in order to be in this position - we don't know.
I'm just so angry for my friend and her husband - they had just accepted a place at the local primary school for their daughter. They've ordered a new sofa. They've literally packed up their house ready to go this week. How can anyone be so selfish to go out of their way to do this, and what absolutely bell* of a vendor!

Under my solicitors advice I had to exchange and complete on the same day once. Most stressful day ever the night before sat eating takeaway from the containers, surrounded by boxes, with removals arriving the next day and not actually knowing with any certainty it was happening.
Horrible business house moves. It’s shocking the number of morally bankrupt people out there. I do feel for your friend. A house sale/purchase isn’t just a transaction, it’s a person’s home and their life you are messing with. I could never be that cruel no matter what offer I got through from a gazumper.

We had something similar in the reverse happen. We were selling and on the cusp of exchange and the buyer stopped responding. When they resurfaced a week later they’d exchanged on another flat in the block. It’s frustrating but the UK system is imperfect.

very very shitty behaviour whatever actually happened (and I would be looking at legal action to recover costs accrued so far - solicitors letter/ threats immediately)

HOWEVER - she is where she is as others have said

She should get out of the chain by selling and renting - even if temporary and not ideal - being in a chain sucks anyway and this sort of things happens.

Ordering sofas etc a big mistake pre-exchange - so many things can happen - our roof fell in a week before exchange and nearly lost buyer ! we scrambled to fix it but - that sort of thing can derail sales/ chains all the time.

People were saying that in 1976.

Estate Agents aren’t legally obliged to present higher offers by the way
If the seller agrees in writing to an offer on the condition that the property is removed from being advertised from the market and will not accept any further offers on the property
There’s no obligation to forward any offers higher or lower. That is entirely down to the Estate Agent being a Cunt.
I think people when they get offers accepted need to word the email carefully.

@PILEALLTHEPILLSONTHEFLOOR It sems they absolutely can. The same thing happened to my daughter, she was due to exchange the following day. Same situation, sold and staying with family. She took the vendors to the small claims court for the costs and breach of agreement etc but she didn't win. A buyer has no rights at all until exchange has happened in England, it's appalling.

Ugh. Terrible for your friend.

I'd have to drop a note through the door - both now for the old owner and again after the next owner moves in - telling them how shitty they are and how much distress it has caused you. If nothing else, it may make them feel a bit guilty.

Or just unleash a box of rotten eggs on their front door one night. Childish, but therapeutic.

If I ever buy a house again, it’s going to be an extraordinary effort to coordinate the sale of two properties within a certain time period so I am going to be putting Office to people with contracts stating basically if they pull out they have to pay all of my costs and accommodate me for three months
I am not having it and people can take it or leave it
If they want to sell their house, they’ll agree

Yes, and unfortunately missives are now being concluded very late in the process. It used to be that as soon as essential searches etc were done and everyone happy, that missives were signed as soon as possible to get the deal locked down.

It certainly can , our buyers pulled out at the end of last year 10 days before our completion date! Removals booked, house packed up, new GP surgery done. We were going into rental, deposit paid , the lot. We continued with the move to the rental as we were committed, left an empty house which thankfully has now sold.
The move to exchange and completion on the same day has become common in Scotland now, so much pressure!

Scottish system is now the same as English system, exchange and completion on the same day.
Speaks from bitter experience….

Vendor & purchaser have done nothing wrong. Solicitor & E.A. proceed as instructed by their clients.
Ethics & morals have no place in the property market in England.

Of course you can
It can take under 24 hours from offer to exchange
Just because it's not the norm, doesn’t mean it can't be done
And this case is clearly not the norm, in that all the searches etc. have obviously already been completed

In Scotland vendors have to pay for the survey to be done first which I do think is good, but offers are not legally binding, missives have to be concluded which used to happen before completion but it’s now common for exchange and completion to happen on the same day. Our buyer pulled out 10 days before our completion date/ moving date recently. And when we finally sold the sale didn’t complete until 4.40 pm on a Friday, our poor buyers were beside themselves as they had nowhere to go. Fortunately we were already in our rental after the previous sale fell through, I did feel for them though.

But as you have referred to, it is the existence of a written contract that creates rights and obligations and protects both sides. A Scottish buyer is no better off if, as in this case, a seller accepts an offer but changes their mind before the formalities have been completed.

Thanks for that info.

There are umpteen reasons why this wouldn't work. You'd be drawing up an entirely new contract with the prospective buyers which would need clauses re an unsatisfactory survey, a mortgage offer, change of circumstances, information found on the land register, charges register etc etc. You couldn't mitigate against every possible issue that could go wrong which would be unforeseen at the point where the offer is accepted. No sensible buyer would go with that proposal. If there were a way around the current system, it would already have been thought of and acted upon. There isn't. It's a rubbish system and yet it continues. The estate agents get their fees, HMRC gets their stamp duty, the buyers and sellers have to suck it up.

As I said previously the solicitor has to withdraw from acting,but nothing can prevent the seller from selling to someone else
The Law Society have no jurisdiction over the clients !

They can - it’s called a contract race. It doesn’t happen often but we have one going at the moment.

It’s fine I spend at least 3 hours a week arguing with dodgy estate agents

I’m not the right sort of solicitor but I think this is an issue for the solicitor. They’ve been misleading someone and that isn’t okay.

Solicitor may have breached their duties if they’ve been purposely misleading and / or lied.

I hope the house is infested 😆

That's quite a nasty wish on the other buyers, do you have any evidence that they did anything wrong?

Yes, they could go to another solicitor, but I've never heard of this happening in Scotland and it does seem to be almost commonplace in England, so the Law Society's approach does seem to be effective. And if someone did try it, then I'm pretty sure that word would get back to the original buyer beforehand - through the solicitors.

There’s no accountability for that. The SRA have got no teeth whatsoever.