Standard residential and commercial property contracts will contain provisions dealing with what happens if either party fails to complete. The initial step where breach occurs is for the non-defaulting party to serve a notice to complete. This then gives the defaulting party usually 10 working days to rectify the breach. If rectification does not take place within the 10 day period then the non-defaulting party shall be entitled to rescind the contract.
A recent Court of Appeal decision on Oakglade Investments Ltd and another v Dhand [2012] EWCA Civ 1986 considered whether a seller was ready, able and willing to complete when it service a notice to complete on a buyer.
In this case the contract provided that the seller would auction three residential properties and if they did not reach a reserve price then the buyer would acquire these properties at an agreed price. The sellers served a notice to complete at a higher price than that in the contract claiming that this higher price had been agreed orally between the parties. The buyer did not complete and the seller threatened to rescind the contracts.
The Court of Appeal found for the buyer stating that the sellers were not able to serve a notice to complete because they were not "ready, able and willing to complete" at the price on the original contract.
This decision is an important reminder that a notice to complete can only be served when a party is ready, able and willing to complete.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
