Public Voices (Guest Post)
I had in early March'10 entered into an agreement to purchase a courtyard terrace in Sri Tanjung Pinang from a foreign owner via an agent. During the negotiation stage, the owner representative had clearly highlighted that the S&P can only be signed by mid-May'10 due to the 3-year restriction on foreign ownership to disposal property in Penang. We had agreed upon that 1% earnest money would be paid upfront to the vendor with the balance 9% payable to vendor's solicitor upon signing of S&P within 14 days. The transfer in escrow shall be dated in mid-May'10 and upon which, the 9% shall be released to the vendor with the balance 90% payable within 3 months thereon.
The unfortunate turn in event was after 1 week of entering into the Offer for Sales and Purchase contract and payment of 1%, the vendor has instructed his lawyer to claim that his client is canceling the sale due to the restriction to dispose the property prior to mid-May'10. Included therein is a cheque refunding the 1% earnest money paid by us without compensation when there is a clause in the Offer for sales & Purchase contract stated that " In the event the Vendor fails or neglect to execute the S&P Agreement within the stipulated period as aforementioned, the Earnest Deposit shall be refunded in full together with an equivalent amount in compensation and in addition thereto, pay a further 1% of the Purchase Price to the Purchaser as agreed liquidated damages".
Hence, I would like to hear from fellow forumers comment on the below:-
1. Based on the aforesaid cancellation clause, my solicitor has rejected the refund and seek on my behalf for the rightful compensation. It took nearly 1 month for the vendor's solicitor to reply that his client is ready to refund my 1% plus the equivalent sum as compensation. I had decided to accept such compensation than fighting for the additional 1% compensation. However, till to-date we have yet to receive any payment nor refund yet and the deadline has passed for the vendor to pay.
My question is should I initiate legal action to summon for the payment? Is there any other action(s) that I should consider?
2. To matters complicated, during this period I had made several calls to agents who advertised E&O property for sales and found out that it was the exact unit that I have paid for but with the vendor now calling for higher price.
Could I use this fact to prove that the vendor canceling my sales is more towards trying to fetch higher price than because of the said restriction?
Any comment would be much appreciated.
Sri Tanjung Pinang subsale vendor cancelled sales
Public Voices (Guest Post)