Reply To: Bank Guarantee expiry date – Supreme Court resolution

Profile photo of Anonymous

Hi Goodstich – am well aware of your previous ‘rantings’ but goodness me, don’t you have the right to rant with your situation! Yours is one of the most disgraceful scenarios I’ve read on the forum. As you know developers are obliged by law to issue all purchasers of off-plans a Bank Guarantee free of charge , it being a criminal offence not to do so. But as we know, many developers ignore this law and seem to get away with it with no repercussions. Your developer is King at this. It would take just one purchaser to successfully go to court and a developer ending up in jail as a result over non-issue of a BG to concentrate some minds.

Hillybilly, you are right and it is only justice afterall. These illegal clauses should never have been allowed/acknowledged and just maybe this resolution will start the ball rolling. I believe a standard BG document worded by the Government that follows every letter of the law should be used by all banks, then there would be no room to ‘fiddle’ with the terms as they’re doing now.

The other favourite coconut of developers is to have the (illegal) clause written into a purchase contract that completion takes place on the issue of the architect’s End of Works certificate. This also goes against the law. Am sure if the Supreme Court dealt with this clause in the same way as the BG expiry date, there would also be a lot of people who could use the precedent to refuse to complete until all legal docs. are in place whether they have signed the contract with such a clause or not. As you know, the Architect’s certificate means nothing with regards to a property’s legal status in the eyes of the Town Hall.

At least this is an important step in the right direction for people who thought they had a worthless expired Bank Guarantee.