A property trader who intends to renovate a house then sell it for profit (and so is GST registered) buys a house at mortgagee auction.
Post auction the purchasers are told that the vendor has claimed GST on the property in the last few days and so the bank is changing the contract from "Inclusive of GST" to "Plus GST if any".
The bank now expects the purchaser to pay the drop of hammer price "Plus GST".
Some questions and thoughts:
The purchaser is buying the property off the bank and so their vendor is (say) Westpac not the person living in the house, and so is this a liability shield?
The bank are pointing out that the contract say's that the bank takes no liability and that all cost's and expenses in the transaction are the liability of the purchaser, but the contract also clearly states that the purchase price is "Inclusive of GST" and the purchaser should be able to rely on the fact that their purchase price is the hammer drop price.
Possible solutions and outcomes welcome.
Post auction the purchasers are told that the vendor has claimed GST on the property in the last few days and so the bank is changing the contract from "Inclusive of GST" to "Plus GST if any".
The bank now expects the purchaser to pay the drop of hammer price "Plus GST".
Some questions and thoughts:
The purchaser is buying the property off the bank and so their vendor is (say) Westpac not the person living in the house, and so is this a liability shield?
The bank are pointing out that the contract say's that the bank takes no liability and that all cost's and expenses in the transaction are the liability of the purchaser, but the contract also clearly states that the purchase price is "Inclusive of GST" and the purchaser should be able to rely on the fact that their purchase price is the hammer drop price.
Possible solutions and outcomes welcome.
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