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Missives
Offers
An
offer to purchase property will very rarely be in terms which can be accepted
without qualification. Even if the basic terms of the offer (price, date of
entry, etc.) are acceptable, the offer will contain a large number of technical
clauses (perhaps as many as 50) which it would be unwise to accept without
making a number of amendments. In particular, the offer will very often contain
a clause stipulating that it is to be accepted within a particular time-limit.
Frequently it is impossible to comply with this time-limit. In any case, as
it is almost always advisable to make a number of other qualifications to
the offer, the deletion of the time-limit is simply one more qualification
in the qualified acceptance.
Qualified
Acceptance
The acceptance of the offer will almost inevitably contain a large number
of qualifications. The purpose of these qualifications is twofold:-
(1) To require the purchaser to satisfy himself regarding the terms of the title deeds, or the position regarding outstanding common repairs etc., before a contract is concluded. This will prevent the purchaser from claiming at a later date that these terms are not acceptable.
(2) To limit the future potential liability of the seller in the event of any claim by the purchaser arising at a later date, for example, in connection with outstanding common repairs or in connection with alterations to the property for which Building Warrant or planning permission may not have been obtained.
Sometimes the purchaser will be able to accept the terms of the qualified acceptance without any further amendment. However, frequently, the purchaser will make two or three further alterations to the terms of the qualified acceptance.
Concluding
Missives
There will be no binding contract between the purchaser and the seller until
such time as all the terms of the offer and qualified acceptance have been
agreed in writing between the respective Solicitors. Once the final letter
has been delivered by one Solicitor to the other accepting in full the terms
of the other Solicitor's last formal letter, there will be a binding contract
or "concluded missives".
Concluded
Missives
Once a contract has been concluded, neither party can withdraw from the contract
without incurring substantial liability to the other party unless there is
a condition in the contract which is breached by the other party. The contract
will usually contain terms which stipulate that, if the purchaser does not
proceed with the purchase at the date of entry specified in the contract,
then he will be liable to pay interest to the seller at fairly high rates
of interest. If there is considerable delay in settling the transaction, then
the seller may be entitled to withdraw from the bargain altogether and resell
the property, recovering the loss and costs as well as interest from the purchaser.
This can be a particular problem where the purchaser has been unable to sell
his own house.
Formal Letters
All of these letters such as the offer and the qualified acceptance, are signed
by the respective Solicitors on behalf of their clients. It should be understood
that, although the client himself has not signed any letter, he will be bound
by the terms of the contract contained in the offer, the acceptance and the
other formal letters.
