• Expired registered sale agreement cancellation

I went into an agreement with  a prospective buyer for my property in June-2014.
The agreement was registered and i had taken an advance of Rs 1 Lakh.
We had terms in our agreement stating that 
a.Sale has to be completed by 6 months from date of  agreement during which i had to get the document of the property ready, and The buyer had buyer had to come with the remaining money i.e 19 Lakhs.
b.If i am ready and Buyer is not ready i can deduct 50k from the advance and return him the remaining money.
c.If the Buyer is ready and i am not i had to pay 50k extra along with his advance money.

But 1 and half year has passed we both did not notify each other.The property's market price has almost doubled.
Now he suddenly sent me a lawyer notice falsely claiming that 
a.He has verbally notified me within 6 months of agreement
b.I have been postponing the sale citing my ill health
c.Also he mentions that all registered agreements have 3 year validity(But we have explicitly mentioned the term of agreement as 6 months from date of agreement)

Now how to cancel this registered agreement. Should i initiate a lawsuit ?
What are my chances of getting judgement in my favor?
Asked 2 years ago in Property Law from Bangalore, Karnataka
Religion: Hindu
1) you should reply to legal notice that agreement had 6 months validity . 

2) since purchaser did not make balance payments inspite of being notified verbally that all papers are ready the sale was cancelled . enclose cheque of Rs 50k 

3) the problem is you have not returned Rs 50k after expiry of 6 months .

4)let purchaser should move court if he is aggrieved by your refusal to enter into regd sale deed 
Ajay Sethi
Advocate, Mumbai
46601 Answers
2756 Consultations

5.0 on 5.0

Firstly you should have notified him in writing that the period to complete the sale transaction had lapsed which was not done by you. Taking undue advantage he has sent you a  lawyer notice putting the entire blame on you, in the reply to that notice kindly state that both of you had met and that mutually you had decided to cancel the agreement and that you had asked him to come forward to cancel the agreement but he was dilly dallying with your request. 
Now if you wish to cancel the sale agreement cite these reasons and get issued another legal notice intimating him that the notice has been duly cancelled as per agreed terms deduct Rs 50k and intimate that you are willing to refund back the balance amount.
After issuing the above notice you will have to file a lawsuit to cancel the agreement legally and also claim damages from the buyer.
Kiran N. Murthy
Advocate, Bangalore
1010 Answers
91 Consultations

5.0 on 5.0

1. A verbal notice is no notice. There had to be a written intimation made to you by the prospective buyer. Reply through your lawyer to the notice.

2. You may cancel the agreement through a lawyer's notice and forfeit 50% of advance paid to you.
Ashish Davessar
Advocate, Jaipur
23084 Answers
639 Consultations

5.0 on 5.0

You should not initiate any suit against him for cancelling the sale agreement.
If he is approaching court let him do it, you can defend it.
Since you have received a legal notice, it becomes your duty to issue a reply notice denying his allegations.
As the sale agreement is specifically made with time stipulation of 6 months, time is very much essential of the contract, hence you can defend on this ground alone
If he approaches court, you may inform court that you are ready and willing to return the advance amount received from him without interest.
If the sale agreement is not a registered document, his case may not be maintainable in court, but since it is registered but as he has not honored the agreement and the oral commitment is not valid in law, it can be treated that he was never ready and willing to perform his part of contract hence he loses the right to enforce the contract in law. 
T Kalaiselvan
Advocate, Vellore
36720 Answers
403 Consultations

5.0 on 5.0

1) Your sale agreement will come under contracts act and your sale agreement terms will be final. 
2) The validity of the agreement will be 6 months only. 
3) The buyer should have intimated to you in writing and verbal notification is not valid. 
4) Issue reply Lawyer notice. 
5) You will get judgment in your favour only( you have done the registration of agreement of sale, you have waited for 6 months and you are ready to comply with your part (i,e refunding advance minus 50000).

5) Since your agreement has well defined terms ( amount specified, penalties vividly mentioned, time for completion of agreement specified), you should first file the suit  under Order 37 CPC. 

6) Don't wait for the other side to file the suit as he may want to drag on the case and create a scene that your property is a disputed property.

6) Suits filed under Order 37 CPC is called summary suit and is decided faster by the courts. 

Order 37 CPC reads as follows: 

Order 37 CPC of the best provisions in the hands of a proposed Plaintiff, wanting to institute a Civil Suit. Broadly it states as under:
Rule 1, Sub-Rule 2 makes it applicable to all suits upon bills of exchange, hundies and promissory notes or the ones in which a Plaintiff seeks only to recover a debt or liquidated demand in money payable on a written contract, an enactment, where the sum to be recovered is a fixed sum of money or in nature of any debt except penalty, a guarantee - in respect of a debt or liquidated demand.

Rule 2 requires an Order 37 Suit to contain among others, a specific averment that the Suit is filed under this Order and no relief which does not fall within the ambit of this Rule is claimed.

Under Order 37, there are two stages of getting the Suit decreed. One is at the stage of Rule 2(3) and the other is at the stage of Rule 2(6).

Rule 2(3) states the procedure for appearance of Defendant which is within 10 days from the service of the summons on him. After entering appearance, the Plaintiff serves on the Defendant summons for judgment within ten days from the date of service supported by an Affidavit; verifying the cause of action, amount claimed and that in his belief there is no defence to the suit.

Rule 2(6) states that in case the Defendant does not apply for a leave to defend, (a) the Plaintiff shall be entitled to judgment immediately or (b) the Court may direct the Defendant to give such security as it may deem fit. Sub-clause 7 states that in case sufficient cause is shown, the delay in entering an appearance or in applying for leave to defend the Suit may also be excused.
Hope this helps
Rajgopalan Sripathi
Advocate, Hyderabad
1321 Answers
167 Consultations

5.0 on 5.0

1) you and your sisters have title  over property 

2) you are not absolute owner of property as as per settlement deed you and your sister were beneficiaries 

3) it is true that you have paid off the loan and redeemed the mortgage but you need your sister consent to sell the property 
Ajay Sethi
Advocate, Mumbai
46601 Answers
2756 Consultations

5.0 on 5.0

In my opinion, since the property was mortgaged but never redeemed by the mortgagor, then the property should have come to an auction  and disposed accordingly.
 But since you are the co-mortgagor and have redeemed the entire property (you have interest only to the extent of your share in the property), there is no mortgage or charge on the property.
At that time you did not enter into any  terms with the co-sharer about this hence it is deemed that your co-sharer and you are in joint ownership, there by  you may have to give her the respective share to her.
This is one perspective and the other possibility is that of your own advocate's views about it. 
The buyer insists on the legal heir ship certificate for the reason which has been opined by me.
In any case the revenue department do not give legal heir ship certificate in Karnataka.  
It is only a notarised family tree certificate or a genealogical tree certificate.
If this buyer is not willing to buy the property due to this reason, you may look for another buyer. Legally the law of adverse possession may also be operative but again it depends on how you put it before court when there arises a civil litigation on this. 
T Kalaiselvan
Advocate, Vellore
36720 Answers
403 Consultations

5.0 on 5.0

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