Freehold - Remedies for Delayed Completion Flashcards
(14 cards)
What constitutes “delayed completion” in a property transaction?
The party due to complete fails to do so on the agreed completion date/time under the contract.
Is delayed completion an actionable legal wrong?
Yes. It’s a breach of contract giving rise to remedies.
What remedy exists at common law for delayed completion?
The innocent party may sue for damages for breach of contract.
What’s the aim of common law damages?
To put the innocent party in the position they would have been in had the contract completed on time.
Where do you usually find contractual provisions for delay compensation in residential transactions?
Standard Conditions of Sale, Condition 7.
Under Standard Conditions of Sale, who can be liable for compensation for delay?
Both buyer and seller.
Where are delay compensation provisions found in commercial transactions?
Standard Commercial Property Conditions, Condition 10.
Under the Standard Commercial Property Conditions, who is liable for delay compensation?
Only the buyer.
How is the contract rate for delay compensation determined?
Either expressly agreed in the contract or defaults to the Law Society Interest Rate if referenced.
What was the Law Society Interest Rate as of April 2025?
4% above Barclays Base Rate; with Barclays Base at 4.5%, total = 8.5%. (Always check current rate.)
If the buyer causes the delay, on what sum is compensation calculated?
On the balance due (i.e., the outstanding completion monies).
If the seller causes the delay, on what sum is compensation calculated?
On the whole purchase price.
Step 1 in calculating contractual compensation for delay?
Calculate daily interest: (Relevant sum × Contract Rate) ÷ 365.
Step 2 in calculating compensation for delay?
Count the number of days late: include the scheduled completion day; exclude actual completion day; count calendar days.
