Suing seller for breach of contract.

[Kristal53]

A friend of mine had a pre-auction offer accepted by the seller on a property. She incurred an admin charge of 400 pounds from the auction house, although the property was to be sold under Private Treaty rules. She then instructed a solicitor who required 250 up front towards disbourements and started the searches etc. Three weeks later the seller pulled out of the deal, saying they had been offered more money. At this point no contracts had been signed , nor had any deposit been taken. Can my friend Sue the seller for the costs incurred so far? she has lost 650 pounds - on what grounds could she Sue as no paper contract has been broken - is a veerbal promise to buy and an acceptance of an offer classed as a 'handshake" promise? thanks

[boxtops]

which part of the country are you in? house selling terms and conditions are different in Scotland.

[Buenchico]

'Gazumping' is perfectly legal. The seller will have cone nothing wrong unless they clearly entered into a contract not to consider any other offers. See "Problems with the seller: The seller gazumps the buyer" here:
http://www.adviceguid...nd_selling_a_home.htm

Chris

[Jonathan-Joe]

I don't see how the auction house can charge your friend anything, their agreement was with the seller of the house, who, I would assume, carries the penalty for withdrawing from the auction.

[tonywiltshire]

Kristel to answer your question a verbal or oral contract is as binding as a written one but the problem is proving the terms of the contract, it would also need to be in the presence of witnesses and with the intention by both parties to create legal relations. A contract for the sale of land can only be in writing, the contract would show the agreed price and if the seller withdrew after the contract are exchanged, or tried to increase the price you would take court action.

As Chris has said gazumping is not illegal, and neither is the potential buyer reducing the offer just before contracts are due to exchanged. It is very common where a property is to be auctioned for someone to lose money, but little in law can be done.

[FredPuli43]

Stupid, isn't it? Had the intended buyer bought the property at the auction, both parties would have been bound on the fall of the hammer. No other country seems to have the absurdity of gazumping being totally legitimate and parties being able to withdraw their agreement in this manner, without penalty.

[Kristal53]

thanks for the replies - to answer a few questions raised - the sale was in England, the property was sold weeks before the auction -the property had had no bids on a previous auction and was due to go back in the next one. My friend did not want to buy with auction rules as its a complicated sale from a Searches point of view ( mine workings, DEFRA) and she offered cash which was accepted by the Vendor. All she has is the usual docs from solicitors saying offer has been accepted, nothing signed. yes this is a ridiculous situation and had the sale not been complicated then she would have bought at auction -looks like an expensive lesson learnt......