Failure to settle property deal costs woman $200,000

A recent case reported by Stuff has cost one woman more than $200,000, after she failed to pay the full amount by a property settlement date.

The Kāpiti Coast property was originally listed as part of a 64-townhouse development in May 2021.

The purchase price for the property was $833,000. A deposit of $83,800 was paid by the woman, and as per the sale and purchase agreement, she was required to pay the balance on the settlement date.

Work on the development commenced in March 2022 and the property’s settlement date was 20 June 2023. The woman failed to make the settlement payment and was issued a notice by the property owner to settle by 20 July. Again, the settlement didn’t occur and a further urgent settlement request was made on 1 August, but that also didn’t occur.

The property owner then entered into a new sale and purchase agreement with a new buyer on August 31, who purchased the property for $702,000. The agreement with the woman was therefore cancelled and the property owner took court action against her.

The property owner said the company had incurred a loss of $52,200, taking into account the woman’s deposit of $83,800, which it retained. They also incurred other costs including $12,570 in real estate agent commission, $6471 for resale marketing, $10,456 for resale furniture staging and $5073 for legal and council costs. $36,000 was also claimed for interest on the unpaid portion of the sale price, for the period in which settlement was not met.

The woman was found liable for damages resulting from her breach of contract in the total sum of $122,768. That is on top of the $83,800 deposit already paid, meaning the total cost of failing to meet settlement came to $206,569.