The parties are as follows:Owner of buil...

Asked by Pieter on 10-01-2020 11:38:19
Question posted in the Property Law category relating to Western Cape

The parties are as follows:

Owner of building:          SEVEN MILE  

Owner of Business:        CBED

Purchaser of Building:  UVP 

Purchaser of Business known as CBeds, a going concern:   

BROKERS:  Jonathan 

The history is as follows:

In Jan 2011 Pieter obtained a Mandate to sell only the building situated at Epping. In April 2011 Jonathan introduced UVP as an investor whereby CBed would sign a long lease and sell the building to UVP. During discussions with the 2 parties UVP showed interest in purchasing the business as well as the building.

Thereafter, Craig (Financial Manager of CBed) started putting financial statements for the business to estimate a selling price On Sat 30 July 2011, without the knowledge of the Brokers, the seller set up a meeting with the sellers and told them to sign a document which they did. 

On this OTP it provided for 5% commission to the broker for the sale of the building and nothing for the sale of the business.  Only on 10 August 11 were we informed that this OTP existed. 

We accepted the conditions of the deal not knowing that the 2 transactions weren’t linked.

We do not have a copy of the Sale Agreement for the business but Joe has advised that the deal was as follows * Price R5m    *down payment of R1m * 4 more down payments of R1m every 6 months thereafter   until Feb 2014    * monthly rental R140k per month until Transfer date The deposit of R100k on the building was paid to BUYERS Conveyancers and thereafter   a number of extensions were entertained to procure a bond   of R13m.

Finally, by June 2012 the OTP was technically invalid as the Purchaser had failed to procure the funding needed to purchase the building.

We negotiated with Joe to sign a lease with an option to purchase the building by Feb 2014 which Joe verbally accepted, but to date our lease was never signed. 

Joe was afraid to upset UVP in case they move the operation out overnight to another property owned by UVP.

We had a meeting with Joe to ask for commission on the income stream of the lease and then absorb it into the commission payable on the sale when (if) the property was transferred in Feb14.

This was not accepted.

UVP have orchestrated this deal totally to their advantage and Joe has to liquidate his assets and we have not received any broking fees.

The Property finally Transferred into the purchaser in Dec 2017. Sale Price was R24.3mill the same guy is a Director in the purchaser. 

 We have not been involved in any communication since 2014.

Can we now claim the commission from Joe as the property has now transferred?

Message from the Lawyer

Posted by Att. Patrick on 12-01-2020 09:16:41

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