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URGENT! Signed LOI, Paid LOI Deposit, Signed TA, Need to back out in <24hrs. 8 wks left to the tenancy commencement date

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kapilsamant
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URGENT! Signed LOI, Paid LOI Deposit, Signed TA, Need to back out in <24hrs. 8 wks left to the tenancy commencement date

Post by kapilsamant » Sat, 06 Jul 2019 12:28 am

We paid LOI (3050$), signed Tenancy Agreement (TA), but due to an unforeseen change in our situation, we need to back out of TA. Eight weeks left to the commencement date of the tenancy.

The sequence of events:
LOI DATE: Thursday 27 June 6:30 PM
LOI Payment: Thursday 27 June 6:30 PM (via pay order)
TA Signing: Sunday 30 June 5:00 PM (We signed the unamended TA in good faith)
Paid LL's agent stamp duty: Sunday 30 June 5:00 PM (Online transfer)
Unforeseen change in our living situation: Monday 1 July 2:30 PM
Request to terminate TA: Monday 1 July 3:30 PM (<24 hours from signing)
Lease Commencement: Tuesday 27 August 10:00 AM (8 weeks later)

We didn't dispute any of the TA clauses (even the restrictive ones) because we have always had the best experience with all my previous LLs. It seems we wrongly presumed the same here in hindsight.

The tenancy agreement contained clauses that should have been amended to include our requests before signing. For instance, TA bars us from keeping pets. We had expressed our intent to keep a dog at-least twice before signing LOI as an essential requirement for us. We could have sought amendments.

But in good faith, on agent's suggestion that we don't need to worry about this LL will act in good faith when we get a pet we signed un-amended TA literally in 20 minutes of receiving it to help avoid inconvenience to LL's agent.

We paid LL's agent 298$ for stamp duty at the time of signing. We made arrangements (sold investments) to pay the 2 months deposit. We intended to follow through.

Unfortunately the next day we faced a sudden unforeseen change in our living situation the next day that makes taking the unit no longer possible (I am keeping it private on this forum). Our situation does not merit the diplomatic clause to be exercised. We didn’t keep the LL in suspense. We disclosed the details of what had just happened in our life to LL immediately. We requested to terminate the TA within 24 hours of signing. 2 Months deposit not yet paid.

We apologised profusely for the inconvenience caused due to TA termination. We offered to compensate for lost time (5 days), opportunity (prospective tenants) and efforts to LL and agent from the LOI money (3050$) and humbly suggested they only return whatever portion LL deem fair.

LL response is that they are out of pocket by 200$ (agent fee from LL is 3260$ > LOI money we paid 3050$). Don't know if this is true. But If it is indeed so. We will happily top-up.

LL is seeking 2-month rent as security deposit (6100$) and seeking to enforce TA. The agent suggested LL may even pursue legal recourse.

As far as I know, there are no exit clauses in the TA. There is nothing that protects us in the TA.

Question 1:
Do I have any legal grounds to stand on the merit of good faith we have demonstrated from the very beginning?

Question 2:
Can the LL force me to take the unit?

Question 3:
Can the LL sue me for reneging on TA? What is the maximum we are liable for considering we no longer can rent the unit?

Question 4:
I want to cut our losses at this point. But be fair to LL and LL's agent. What should we do?

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Re: URGENT! Signed LOI, Paid LOI Deposit, Signed TA, Need to back out in <24hrs. 8 wks left to the tenancy commencement

Post by PNGMK » Sat, 06 Jul 2019 10:53 am

An important question here - are you staying in Singapore on longer or leaving?

If you're leaving I'd make that clear to the agent and continue to offer a reasonable settlement until you leave. After that the chances of the LL or his agent recovering funds are very low and they know it. Even after you leave continue to email to try to settle at a reasonable figure - don't provide a forwarding address or similar where they can send writs or summons however.

If you're staying on in Singapore you might need to look at subletting to reduce your losses - i.e. cover the outgoings until someone else can take up the unit. At the moment it is a renters market so it may take time to get someone in which is why the LL and agent are being difficult. You'll need the LL agreement to sublet put in a replacement tenant but this is the only way out of they stick to the TA. If you don't move in and don't pay rent at some point they will have reason to sue you and could win (with costs).

Why you thought written terms would not apply in a TA baffles me.
I not lawyer/teacher/CPA.
You've been arrested? Law Society of Singapore can provide referrals.
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Re: URGENT! Signed LOI, Paid LOI Deposit, Signed TA, Need to back out in <24hrs. 8 wks left to the tenancy commencement

Post by x9200 » Sat, 06 Jul 2019 11:35 am

kapilsamant wrote:
Sat, 06 Jul 2019 12:28 am
We paid LOI (3050$), signed Tenancy Agreement (TA), but due to an unforeseen change in our situation, we need to back out of TA. Eight weeks left to the commencement date of the tenancy.

The sequence of events:
LOI DATE: Thursday 27 June 6:30 PM
LOI Payment: Thursday 27 June 6:30 PM (via pay order)
TA Signing: Sunday 30 June 5:00 PM (We signed the unamended TA in good faith)
Paid LL's agent stamp duty: Sunday 30 June 5:00 PM (Online transfer)
Unforeseen change in our living situation: Monday 1 July 2:30 PM
Request to terminate TA: Monday 1 July 3:30 PM (<24 hours from signing)
Lease Commencement: Tuesday 27 August 10:00 AM (8 weeks later)

We didn't dispute any of the TA clauses (even the restrictive ones) because we have always had the best experience with all my previous LLs. It seems we wrongly presumed the same here in hindsight.

The tenancy agreement contained clauses that should have been amended to include our requests before signing. For instance, TA bars us from keeping pets. We had expressed our intent to keep a dog at-least twice before signing LOI as an essential requirement for us. We could have sought amendments.

But in good faith, on agent's suggestion that we don't need to worry about this LL will act in good faith when we get a pet we signed un-amended TA literally in 20 minutes of receiving it to help avoid inconvenience to LL's agent.

We paid LL's agent 298$ for stamp duty at the time of signing. We made arrangements (sold investments) to pay the 2 months deposit. We intended to follow through.

Unfortunately the next day we faced a sudden unforeseen change in our living situation the next day that makes taking the unit no longer possible (I am keeping it private on this forum). Our situation does not merit the diplomatic clause to be exercised. We didn’t keep the LL in suspense. We disclosed the details of what had just happened in our life to LL immediately. We requested to terminate the TA within 24 hours of signing. 2 Months deposit not yet paid.

We apologised profusely for the inconvenience caused due to TA termination. We offered to compensate for lost time (5 days), opportunity (prospective tenants) and efforts to LL and agent from the LOI money (3050$) and humbly suggested they only return whatever portion LL deem fair.

LL response is that they are out of pocket by 200$ (agent fee from LL is 3260$ > LOI money we paid 3050$). Don't know if this is true. But If it is indeed so. We will happily top-up.

LL is seeking 2-month rent as security deposit (6100$) and seeking to enforce TA. The agent suggested LL may even pursue legal recourse.

As far as I know, there are no exit clauses in the TA. There is nothing that protects us in the TA.

Question 1:
Do I have any legal grounds to stand on the merit of good faith we have demonstrated from the very beginning?

No

Question 2:
Can the LL force me to take the unit?

To move you in? No, not really, but this is kind of irrelevant.

Question 3:
Can the LL sue me for reneging on TA? What is the maximum we are liable for considering we no longer can rent the unit?

No, but he can sue you for any damages he suffered because of you action.

Question 4:
I want to cut our losses at this point. But be fair to LL and LL's agent. What should we do?

Agree to cover his expenses + something extra.
Note: it is very unlikely any court would make you pay 24 month of rental. Normally you are expected to cover the actual tangible damages + maybe some more for what is not tangible.
I would propose:
- cover his agents commission upon delivering a proof it was paid
- 2-4 weeks of rent.

This is what I would consider reasonable taking into account that you still have like 7 weeks to go for the TA to commence.

If the LL is not willing to accept this, send him this proposal as an official letter, perhaps even ask a lawyer to write it on your behalf, give him some time to respond (a week) and if still not agreeable ask him to sue you.


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Re: URGENT! Signed LOI, Paid LOI Deposit, Signed TA, Need to back out in <24hrs. 8 wks left to the tenancy commencement

Post by kapilsamant » Sat, 06 Jul 2019 5:24 pm

Thank you for your response.

PNGMK wrote:
Sat, 06 Jul 2019 10:53 am


An important question here - are you staying in Singapore on longer or leaving?
Staying.
PNGMK wrote:
Sat, 06 Jul 2019 10:53 am


If you're leaving I'd make that clear to the agent and continue to offer a reasonable settlement until you leave. After that the chances of the LL or his agent recovering funds are very low and they know it. Even after you leave continue to email to try to settle at a reasonable figure - don't provide a forwarding address or similar where they can send writs or summons however.

If you're staying on in Singapore you might need to look at subletting to reduce your losses - i.e. cover the outgoings until someone else can take up the unit. At the moment it is a renters market so it may take time to get someone in which is why the LL and agent are being difficult. You'll need the LL agreement to sublet put in a replacement tenant but this is the only way out of they stick to the TA. If you don't move in and don't pay rent at some point they will have reason to sue you and could win (with costs).
Didn’t understand the sublet part. The TA currently does not allow for it. Are you suggesting I seek amendment of TA to sublet it?
PNGMK wrote:
Sat, 06 Jul 2019 10:53 am

Why you thought written terms would not apply in a TA baffles me.
Consider it naïveté or consider it misplaced good faith. The Agent was speaking in terms that made it seem, We have no reason to worry, so long as we are reasonable with our request. The LL will exercise good faith. For instance the pets clause, she said it’s ok, just scribble it on a pre-signed LOi, no need to worry about amending TA.
Last edited by kapilsamant on Sat, 06 Jul 2019 5:41 pm, edited 1 time in total.

kapilsamant
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Re: URGENT! Signed LOI, Paid LOI Deposit, Signed TA, Need to back out in <24hrs. 8 wks left to the tenancy commencement

Post by kapilsamant » Sat, 06 Jul 2019 5:32 pm

x9200 wrote:
Sat, 06 Jul 2019 11:35 am
kapilsamant wrote:
Sat, 06 Jul 2019 12:28 am
We paid LOI (3050$), signed Tenancy Agreement (TA), but due to an unforeseen change in our situation, we need to back out of TA. Eight weeks left to the commencement date of the tenancy.

The sequence of events:
LOI DATE: Thursday 27 June 6:30 PM
LOI Payment: Thursday 27 June 6:30 PM (via pay order)
TA Signing: Sunday 30 June 5:00 PM (We signed the unamended TA in good faith)
Paid LL's agent stamp duty: Sunday 30 June 5:00 PM (Online transfer)
Unforeseen change in our living situation: Monday 1 July 2:30 PM
Request to terminate TA: Monday 1 July 3:30 PM (<24 hours from signing)
Lease Commencement: Tuesday 27 August 10:00 AM (8 weeks later)

We didn't dispute any of the TA clauses (even the restrictive ones) because we have always had the best experience with all my previous LLs. It seems we wrongly presumed the same here in hindsight.

The tenancy agreement contained clauses that should have been amended to include our requests before signing. For instance, TA bars us from keeping pets. We had expressed our intent to keep a dog at-least twice before signing LOI as an essential requirement for us. We could have sought amendments.

But in good faith, on agent's suggestion that we don't need to worry about this LL will act in good faith when we get a pet we signed un-amended TA literally in 20 minutes of receiving it to help avoid inconvenience to LL's agent.

We paid LL's agent 298$ for stamp duty at the time of signing. We made arrangements (sold investments) to pay the 2 months deposit. We intended to follow through.

Unfortunately the next day we faced a sudden unforeseen change in our living situation the next day that makes taking the unit no longer possible (I am keeping it private on this forum). Our situation does not merit the diplomatic clause to be exercised. We didn’t keep the LL in suspense. We disclosed the details of what had just happened in our life to LL immediately. We requested to terminate the TA within 24 hours of signing. 2 Months deposit not yet paid.

We apologised profusely for the inconvenience caused due to TA termination. We offered to compensate for lost time (5 days), opportunity (prospective tenants) and efforts to LL and agent from the LOI money (3050$) and humbly suggested they only return whatever portion LL deem fair.

LL response is that they are out of pocket by 200$ (agent fee from LL is 3260$ > LOI money we paid 3050$). Don't know if this is true. But If it is indeed so. We will happily top-up.

LL is seeking 2-month rent as security deposit (6100$) and seeking to enforce TA. The agent suggested LL may even pursue legal recourse.

As far as I know, there are no exit clauses in the TA. There is nothing that protects us in the TA.

Question 1:
Do I have any legal grounds to stand on the merit of good faith we have demonstrated from the very beginning?

No

Question 2:
Can the LL force me to take the unit?

To move you in? No, not really, but this is kind of irrelevant.

Question 3:
Can the LL sue me for reneging on TA? What is the maximum we are liable for considering we no longer can rent the unit?

No, but he can sue you for any damages he suffered because of you action.

Question 4:
I want to cut our losses at this point. But be fair to LL and LL's agent. What should we do?

Agree to cover his expenses + something extra.
Note: it is very unlikely any court would make you pay 24 month of rental. Normally you are expected to cover the actual tangible damages + maybe some more for what is not tangible.
I would propose:
- cover his agents commission upon delivering a proof it was paid
- 2-4 weeks of rent.

This is what I would consider reasonable taking into account that you still have like 7 weeks to go for the TA to commence.

If the LL is not willing to accept this, send him this proposal as an official letter, perhaps even ask a lawyer to write it on your behalf, give him some time to respond (a week) and if still not agreeable ask him to sue you.

Thank you so much for your advice. I have offered the LOI money (3050) and will offer to top up (with proof of payment to agent).

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Re: URGENT! Signed LOI, Paid LOI Deposit, Signed TA, Need to back out in <24hrs. 8 wks left to the tenancy commencement

Post by PNGMK » Tue, 09 Jul 2019 8:41 am

I struggle to see what unforseen situation prevents you from moving in if you're still in Singapore and still employed. Finding a place you like better is not a good enough reason to cancel a TA without a significant penatly.
I not lawyer/teacher/CPA.
You've been arrested? Law Society of Singapore can provide referrals.
You want an International School job? School website or http://www.ISS.edu
Your rugrat needs a School? Avoid for profit schools
You need Tax advice? Ask a CPA
You ran away without doing NS? Shame on you!

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Re: URGENT! Signed LOI, Paid LOI Deposit, Signed TA, Need to back out in <24hrs. 8 wks left to the tenancy commencement

Post by kapilsamant » Fri, 12 Jul 2019 6:54 am

PNGMK wrote:
Tue, 09 Jul 2019 8:41 am
I struggle to see what unforseen situation prevents you from moving in if you're still in Singapore and still employed.
My wife have lived in a 1 bedroom studio for past 3 years. We were looking at this 2 bedroom because of her plans of continuing to stay in Singapore and become employed soon.


While I remain employed and will remain in Singapore. My wife is a PhD student. Her compulsion to move out of Singapore (to UK) for academic reasons in December 2019 was sudden and unforeseen event due to developments at her university. This is what triggered our crisis of inopportune timing.

Weighing the financial implications of my wife moving out of Singapore with no prospect of a job for 2 years starting December 2019, we could no longer justify the need for this bigger house / nor justify increased cost of renting this house. Hence needed to stay in the current house.
PNGMK wrote:
Tue, 09 Jul 2019 8:41 am

Finding a place you like better is not a good enough reason to cancel a TA without a significant penatly.
My wife and I are fair minded folks. We wouldn’t dare request cancelling TA due to an attractive house elsewhere (also there isn’t one). It wouldn’t be fair to the landlord or the landlords agent.We really liked this house. Till our circumstances suddenly changed.

Lastly an update on the LL situation.

Our offer to pay an additional 3050$ over an above 3050$ previously paid, for a house we never lived in, requested to cancel TA 2 months before lease began, has been been dismissed by the landlord.

LL is seeking additional 6100$ (9150$ total). Thats a ton of money we can’t afford for 24 hours of unfortunate timing. Sigh :(

My wife and I regret moment we signed the TA under duress trying not to inconvenience the LL and the LL’s agent.

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Re: URGENT! Signed LOI, Paid LOI Deposit, Signed TA, Need to back out in <24hrs. 8 wks left to the tenancy commencement

Post by Strong Eagle » Fri, 12 Jul 2019 8:04 am

Your options are narrowing, and they basically boil down to, "Take what I've offered you or take nothing and piss off." Then you will get to find out what the LL will do next.

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Re: URGENT! Signed LOI, Paid LOI Deposit, Signed TA, Need to back out in <24hrs. 8 wks left to the tenancy commencement

Post by PNGMK » Fri, 12 Jul 2019 9:31 am

OP - I'd say your offer is fair and will withstand scrutiny at the SCT if it goes that far. Pay NOTHING further unless a clear written statement around TA cancellation is given.
I not lawyer/teacher/CPA.
You've been arrested? Law Society of Singapore can provide referrals.
You want an International School job? School website or http://www.ISS.edu
Your rugrat needs a School? Avoid for profit schools
You need Tax advice? Ask a CPA
You ran away without doing NS? Shame on you!

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Re: URGENT! Signed LOI, Paid LOI Deposit, Signed TA, Need to back out in <24hrs. 8 wks left to the tenancy commencement

Post by brian_singapore » Fri, 12 Jul 2019 11:22 am

Remember: the LL is negotiating. This is a negotiation.

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Re: URGENT! Signed LOI, Paid LOI Deposit, Signed TA, Need to back out in <24hrs. 8 wks left to the tenancy commencement

Post by kapilsamant » Sat, 13 Jul 2019 3:58 pm

brian_singapore wrote:
Fri, 12 Jul 2019 11:22 am
Remember: the LL is negotiating. This is a negotiation.
Update as of 12th July, It's been:
    15 days since we paid LOI money (1 Month rent)
      12 days since we signed TA
        11 days since we requested TA termination by forfeiting LOI money (all or partial)
          8 days since we asked for a meeting with LL via LL's agent to resolve (it was refused via whatsapp forwarded message)
            6 days since LL demand: LOI (already paid) + 2 Month rent (via whatsapp forwarded message of an unsigned letter)
              6 days since we offered LOI (already paid) + 1 Month rent
                4 days since the offer was refused (via whatsapp forwarded message)
                  42 days remaining for the tenancy to start (27th August 2019)

                  With each passing day, my wife and I are having a hard time in our day to day work.

                  My wife hasn't been able to nail her PHD 'pitch' to her guide to sort out her Uni issues.

                  We have had to deal with this at an incredibly busy time at work for me.

                  We have conveyed that LOI (already paid) + 1 Month rent is our best offer in good faith.

                  We remain in limbo and at the agent's mercy as all conversations are only through her at this point.

                  We don't know if our offers have been seen by LL, understood in the context we offered them and rejected. At this point, we would consider even just knowing that as progress made.

                  All we have to date are WhatsApp messages which appear forwarded that says: “your offer is rejected” or a PDF letter that appears forwarded on WhatsApp and puts forth LL's proposal stated above. Strangely though, while this letter is carefully worded and addressed to me at the top it ends abruptly. It's totally blank at the bottom even the name of the LL is not listed.

                  Our request for a direct phone number/email or a meeting with LL to resolve has been either refused via the agent or gone unanswered by the agent for a few days now.

                  Don't know where we go from here.

                  Can't wait for this nightmare to be over.

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                  Re: URGENT! Signed LOI, Paid LOI Deposit, Signed TA, Need to back out in <24hrs. 8 wks left to the tenancy commencement

                  Post by PNGMK » Sun, 14 Jul 2019 6:43 pm

                  The agent won't have over the LL info. However if sued in the SCT will you will then see it and be able to negotiate direct to settle.. Don't panic, don't pay anymore. YOU ARE ON THE WINNING SIDE. They want the money. They will settle or lose it all. They know it.
                  I not lawyer/teacher/CPA.
                  You've been arrested? Law Society of Singapore can provide referrals.
                  You want an International School job? School website or http://www.ISS.edu
                  Your rugrat needs a School? Avoid for profit schools
                  You need Tax advice? Ask a CPA
                  You ran away without doing NS? Shame on you!

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