Danger of failing to buy on “practical completion”

If your new property is being built your obligation to complete your purchase usually turns on whether the archtect or other contract administrator has certified the building work is “practically complete”  – basically whether it can be used for its intended purpose which may include an initial fit out by the proposed occupant.

Linda Burgess was sued by a property renovation firm, Elmbid Ltd.,  after failing to complete the purchase of a £1.3m retirement home Bottom End Barns, in Norfolk, as the  work had not been “satisfactorily” finished.

But a judge ruled in the  High Court that Elmbid was entitled to damages and to  keep a £110,000 deposit she had paid.

The court expressed the view that her duty to complete the purchase was triggered by the issue of the certificate of practical completion even if that was wrong.  But she had failed to prove even that.  As useful future guidance the court said the kind of defects and the cost of putting them right relative to the total purchase cost were relevant factors in deciding whether practical completion had occurred.

Leave a Reply