Would-be buyers of condos in the beleaguered Murrayville House project are appealing a judge’s decision that saw their pre-sale contracts cancelled.
Fred West has been waiting two and a half years since he and his wife put down their payment for a condo in the project.
After numerous construction delays plagued the project, it was finally completed physically late last year. However, legal wrangles between the creditors, the pre-sale buyers, and the builder continue. The project is in receivership and remains empty as ownership is sorted out.
On April 4, pre-sale buyers were devastated by a ruling that their contracts had essentially expired, and mortgage lenders to the project took priority.
The pre-sale buyers would have right of first refusal to buy their units, but at current market prices.
That’s impossible for many of the owners, who put down their deposits before condo prices skyrocketed.
“We paid somewhere in the vicinity of $340,000, and it was going to be listed for $503,000,” West said of the condo he’d planned to buy.
Now a judge has sent the matter to the B.C. Court of Appeals. A three-judge panel will hear arguments by a group of 22 buyers, represented by Solimano Law, on June 12.
“One for the little guys,” said West.
He admitted the buyers have no idea what the appeals court judges will decide, but he was very satisfied they’ll get a hearing.
If the appeals court overturns the ruling and sides with the pre-sale buyers, it could set a legal precedent for similar real estate situations in B.C.
On April 4, Justice Shelley Fitzpatrick had ruled that mortgage holders had legal priority over pre-sale buyers.
Creditors who financed various mortgages are owed more than $51 million in principal and interest.
The lenders had opposed allowing the pre-sale buyers to fulfill their contracts. They argued for selling the units at market price so they could recoup more of the money they are owed.
An appraisal of the project showed that the units’ value was 46 per cent higher than contract prices.
There are 92 units in the building. Courts are still sorting out the ownership of many of the remaining units, which had even more complicated issues to resolve. Fitzpatrick described the situation as “chaos” at one point in her April 4 judgment.
The primary developer of the project, Mark Chandler, was ordered extradited to the United States earlier this year to face a fraud charge in California. He is currently appealing that ruling.
The RCMP has also confirmed it is investigating the situation around Murrayville House.