Jack Chambers (Dublin West, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

299. To ask the Tánaiste and Minister for Justice and Equality if legislation that would allow clauses to be put in house purchase contracts that would protect buyers should their bank approval lapse before the build is complete will be considered (details supplied); and if he will make a statement on the matter. [42054/18]

Charles Flanagan (Laois, Fine Gael)
Link to this: Individually | In context | Oireachtas source

The Deputy will appreciate that I am not in a position to comment on individual cases. In addition, the question relates primarily to consumer or contract law and, as such, does not fall within my area of responsibility.

In relation to the conveyancing of property, by way of general information, the position is that the payment by a purchaser of a deposit on entering into a contract for sale of a property is normally required by the conditions of sale. The deposit is usually regarded both as a part payment of the purchase price of the property and as a security for or a guarantee of performance of the contract by the purchaser.

As a general rule it has been well settled in case law that the vendor may retain (or forfeit) the deposit if the purchaser defaults on the contract (Doyle v. Ryan [1981] ILRM 375; Draisey v. Fitzpatrick [1981] ILRM 219). Equally, case law provides that the purchaser may recover the amount of the deposit, with interest, plus the cost of investigating the title of the property if the vendor defaults on the terms of the contract (Dickie v. Wright (1901) NIJR 128).

I understand that Condition 41 of the Law Society's General Conditions of Sale - which, invariably, form the basis for the contract under which a property is sold and purchased - contains express provisions regarding the issue of the retention of a deposit by a vendor.

The Deputy may also wish to know that, with regard to the overall issue of house purchase contracts, my Department has been informed by the Department of Business, Enterprise and Innovation that such contracts are subject to the Regulations that give effect to Directive 93/13/EEC on unfair terms in consumer contracts, principally the European Communities (Unfair Terms in Consumer Contracts) Regulations 1995 (S.I. No. 27 of 1995). Contract terms are assessable for unfairness under the Regulations unless they are individually negotiated between the seller and the consumer, or they relate to the definition of the main subject matter of the contract or the adequacy of the price as against the goods or services supplied insofar as these terms are in plain, intelligible language.

Given the possible implications for purchasers of not being able to meet the terms of any contract for sale, it is clear that prudent prospective purchasers should seek expert and independent legal advice before signing a binding contract for the purchase of a property.