In the days leading up to the settlement of the sale of a property there a few things every vendor should do to ensure the settlement goes ahead smoothly and the sale proceeds end up in the vendor’s bank account!
Firstly, normally, the vendor’s agent will be holding the deposit in its trust account unless the parties have agreed for it to be invested with a bank. The vendor should contact the agent and make arrangements for the deposit (less the commission and any expenses) to be paid to the vendor’s nominated bank account by electronic funds transfer.
Secondly, if the Contract provides for vacant possession to be given on settlement, this means that (a) there should be no occupants in the property, including a tenant on an expired lease, and (b) there should be no physical impediments that would interfere with the purchaser’s right to use and occupy the property.
To ensure there are no physical impediments on settlement:
* The vendor should remove all goods from the property not included in the sale.
* Any rubbish should be removed from the property although there is no obligation to leave the property in a reasonably clean condition.
The purchaser is entitled to conduct a final inspection shortly before settlement to ensure that vacant possession will be given. Any failure to comply with the vendor’s obligation to do so will allow the purchaser to delay the settlement until the vendor has complied.
Disputes often arise at this critical time as to whether vacant possession is being given or how to give it. In such circumstances, legal advice and negotiations are the best option.
June 2024