I have been involved in two claims recently where the landlords’ valuers offered a ‘quick deal’ to reach a settlement premium. In both cases, time was of the essence to reach a conclusion to avoid litigation costs | take up a mortgage offer before it expired.
This all sounds fine in principal at the outset and indeed both landlords came quickly to their respective ‘bottom lines’. However the problem with this method of negotiation – there was no meeting to go through the individual component parts of each valuation and more particularly as to a) freehold capital values and b) relativity. As a result both sides had to undertake a certain amount of ‘guess work’ by back analysis to interpret where the other side was exactly coming from in order to calculate the next move.
More pertinent though, as in any negotiation, the bridging of the final gap is the hardest to achieve and especially here where the landlords’ valuers ‘quick deal bottom line’ was simply too high.
Nevertheless peace in both claims was finally reached even though the negotiation took just as long to settle than if it had been conducted normally.
More importantly my clients were delighted to settle for lower premiums than the landlords would go no lower than to settle!