Getting the Deposit Back from the Developer

Hi, I have tried to find the answers to my questions by trawling through lots of posts, but couldn't find an answer. Apologies if this has been answered elsewhere. I do have independent lawyers, but they have not given my any useful insight. I paid €125,000 (30%) on an off plan apartment. I can now no longer afford to complete, and am trying to work out what my options are. The LFO is there (over 2 years late), and the only reason they are not chasing me for completion is that (according to my lawyer): ".. the lawyer´s promoters (sic) ... informed me that they are dealing with another promoters (Constructora San José) for payment purposes due to the financial problems. She will contact me as soon as they have an agreement with the said “constructora”." I have heard from another purchaser that they have been unable to get a mortgage because of creditors having a charge on the development. The purchase agreement does say: "The Parties agree that in the event that the buyer defaults on any of his obligations under this contract, the seller may rescind this purchase and sale, notification is necessary. The seller will be able to retain 50% of the buyer's payments up to that date as damages." My q's are: 1) I assume that there is no prospect of getting my deposit back (despite the para from the contract, quoted above)? 2) Is there much likelihood of the developer pursuing me through court? (I live in the UK). Doesn't the quoted para 'decide' what the developers recourse is? 3) Can I use the fact that they are in financial difficulties / the charge is causing problems in getting a mortgage, to help my position? Thanks in anticipation. John

Dear Sir,

You are not legally obliged to complete on a property with charges as it stands to logic.

Please read our reply on this thread.

In any case as from the moment the developer attains the Licence of First Occupation you are obliged to complete on the property or else risk being sued for non compliance as stressed in this other thread.

You can force a cancellation of the contract if there is a charge on it, yes, regardless if there’s a LFO issued already. No-one can force you to select another property, you chose a property specifically in your PPC and only that one and by reasons which are unrelated to yourself has become legally unavailable as there is a charge lodged against it. If you want to swap over to another property a new contract will have to be signed and it’s your option.

So, bottomline, you can pull out now legally despite of the issued LFO (providing this charge is effectively and following your own words in place).

It’s up to the developer to sue you or not for non-compliance; in this case how can they sue you if they themselves are in breach first? Not possible until the charge is lifted.