Viewing a house during coronavirus: you can look but you must not touch…

"You can look but you must not touch…": the advice given to one of our clients by an estate agent upon a second viewing of a property. The property was not occupied by the owner and the agent wore latex gloves throughout. The image conjures up Hollywood film trailers but this is the reality we are facing at present.

It is time to contact your lawyer

But if you’re already part way through your transaction and wish to start moving again then recontact your conveyancing lawyer to talk about contract clauses. With any sale and purchase there is always a risk that the transaction might not complete. If completion does not occur then the innocent party may serve notice on the defaulting party which allows ten working days for the defaulting party to complete. That defaulting party will also be potentially liable for losses arising. If they still fail to complete then the defaulting party is potentially liable to forfeit the deposit (if they are the buyer) and be liable for any further losses incurred by the innocent party. There is also an option for the innocent party to force the other party to complete – although this is more difficult if the defaulting party is the seller.

The present difficulties arising from Coronavirus mean that there are increased risks that transactions may not complete on time. There is also the difficulty of being reliant upon others (such as removal companies) who might decide that they are unable to move someone in the chain due to the virus. If you have already selected a removal company we recommend that you check their Terms of Business to see if this is a risk for you.

What steps can you take?

With the situation changing rapidly, nobody knows how the market will look in a few days  time, let alone weeks; so to help you navigate this uncertainty we have set out the three options to consider:

• You could proceed to exchange of contracts in the usual way and rely on the existing contract to resolve the position against the potential defaulting party. This means that as a buyer you are still likely to complete eventually so there is more certainty although there is still the possibility of delay and losses arising.
• You could insist upon a clause being added to the contract (force majeure) which would allow for an agreed postponement of completion in certain scenarios. This is a complex provision and all parties in the chain would need to agree to the same clause applying. This will lengthen the time to exchange and increase legal costs but could prove to be a workable solution.
• You could agree to have a simultaneous exchange and completion which the chain works towards. If the matter proceeds satisfactory then this is a simple solution. The downside is that completion date is not certain so any party (including you) may withdraw before then. However, if completion does not occur you will have limited your liability to your own losses (not the other side).