This week Q&Alooks at taking advantage of a discrepancy in contract price and clearence for farm land
Taking advantage of a discrepancy in contract price
Q My partner and I have put down a booking deposit for a house with an advertised cost of (let's say) €600,000. We received contracts from our solicitor to review and sign, however the contract states a "contract price" of (let's say) €500,000. Are we entitled to sign the contract without raising the issue of the difference of costs? Do we sign, give the 10 per cent deposit based on €500,000 and hope for the best? Our booking deposit receipt states that the contract price is for €600,000.
A This is one for your own solicitor - however we also got Kieran Lawlor of O'Sullivan Partners, to look at your question. He points out there is no binding contract between vendor and purchaser until contracts in an agreed form have been signed and exchanged and a full deposit paid by the purchaser. Lawlor also says that if the vendor signs without noticing the mistake, it is almost certain that he will not complete the sale, and pursuing legal action may be the only option open to you.
Should you sign and pay the reduced deposit and the vendor notices this before signing, it is probable that he will return the contracts with the correct price stated for re-execution. If both parties sign the contracts at the reduced price, it is probable that the vendor will notice the mistake prior to completing the sale and may refuse to carry out the contract. Should this happen, you may pursue an action in the courts for specific performance of the contract. Specific performance is an equitable remedy but, as you noticed the mistake and would be seeking to take advantage of it, the courts could look unfavourably upon your conduct. In addition, the vendor could seek to have the contract declared null and void due to the fundamental mistake in the contract price. He could argue that the contracts he signed did not accurately record the prior agreement which is stated on the booking deposit receipt, i.e. the agreed price of €600,000 rather than the stated €500,000.
Another scenario is that the vendor might argue that there is a case of mistake (presumably on the part of his agent or solicitor who drafted the contract), and he might accept the reduced price from you and then pursue a professional negligence claim against the agent or solicitor to recover the balance.
Ultimately, according to Lawlor, if the purchaser and vendor both sign the contracts stating the reduced price, there is only a very slim chance of enforcing such a contract and it will inevitably lead to delaying the completion and may even cause the vendor to walk away from the transaction.
Do I need clearance to buy farm land?
Q I have the opportunity to buy some farm land (not for farm use), but, as I am a non-national, the seller advised that I would have to seek clearance from the Department of Agriculture. How do I go about this? Is it a lengthy process?
A Your seller might be thinking of an old piece of legislation. There is no restriction on anyone buying land in Ireland as far as the Department of Agriculture and Food is concerned. In 2005, Section 45 of the Land Act 1965 was repealed - that was the provision where non-nationals had to seek the consent of the Land Commission when buying land.
Your questions
Send your queries to Property questions, The Irish Times, The Irish Times Building, 24-28 Tara Street, Dublin 2 or e-mail propertyquestions@irish-times.ie. Unfortunately it is not possible to respond to all questions. The above is a representative sample of queries received. This column is a readers' service and is not intended to replace professional advice. No individual correspondence will be entered into.
