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Thomas, Lawyer
Category: UK Law
Satisfied Customers: 7620
Experience:  BA (Hons), PgDip, Practising Solicitor
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I recently left a large deposit on a flat ,I desired £5000

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I recently left a large deposit on a flat ,I desired £5000 ,by cheque ,which was cashed by seller ,unfortunately ,through a couple of reasons I could not go ahead with the purchase,I had only given the money as a 'holding deposit' since withdrawing from the sale,quite amicably I awaited the return of my deposit ,when requested to do so the seller refused,saying he had no legal obligation to oblige me.What are my rights under Engish Law

Was this to purchase a long lease flat? eg. 125 or 999 years, as opposed to a assured shorthold tenancy?

Did you sign an agreement or anything in relation to the £5000 holding deposit?

What does this say about the return of the monies?

Customer: replied 4 years ago.

Sirs ,Re.your response to my enquiry,'it swas the purchase of the property 29a St,Georges Road Brightonfor £176,ooo,is this the info you required?


Did you signing a holding deposit agreement, or any other agreement when you made the offer and it was accepted?

If so, what does this say about the holding deposit?

Customer: replied 4 years ago.

In the above transaction ,I gave the father of the seller, a cheque drawn on my account at Lloyds TSB which they cashed, the proof that I gave them the money ,nothing else was done in writing.

I knew the seller personally ,I thought as a friend/mate I lived in the upstairs appartment, over the one he wished to sell,we were always on good terms ,in fact with regard, to the Building Cover on the property,I always settled it ,with the Insurance Brokers,"Rias" and he always sent me his share ,of 40%. Which had been agreed by our lawyers,when I purchased ,the upstairs flat.

This ,I think,shows a trusting and amicable relationship and perhaps why I behaved so foolishly by giving such a large deposit, sincerely T.D.G.



So, basically you just £5000 to a proposed seller without agreeing any conditions whatsoever without discussing whether what the circumstances in which the deposit would be returned to you OR what the circumstances would in which the deposit would be retained by the Seller.

Is this correct?
Customer: replied 4 years ago.



I'm really sorry, but I will have to answer tomorrow.

I'm out of the house on my phone!

Thanks for your patience.

Transferring the money in this way was very imprudent.

The difficulty is that holding deposits can be either refundable in some circumstances or not refundable and it is for the parties to specify which it is to be. This would usually be in the form of a reservation agreement or separate holding deposit agreement.

If you did not agree terms in respect of placing the deposit with the proposed Seller then you’re going to have to fight it out, possibly by litigating on the matter if you cannot agree to a settlement.

The question is what each of you was intending by transferring the deposit to the Seller.

In the first instance you should see a solicitor to write a letter before action to the Seller setting out your position and understanding of the purpose of the deposit and requesting that the amount be returned. In the letter you should state that you will issue a claim at county court to recover the monies in the event that the money is not returned.

You can use their reply as a negotiating starting point, or then issue if no satisfactory response is received.

If your position is that the transfer was simply to show commitment to the transaction as a show of good faith then it will depend on whose terstimony the court attaches the greater weight of evidence.

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Kind regards,

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