Abandoned Projects

Where the required bylaws and safeguard against the errant developers are not present, more often than not, there is misuse of funds and/or mismanagement, leaving the housing project abandoned. The developer facing “Chapter 11” provides no way out for the innocent homebuyers and/or investors.

In the event, there is subsists a bridging loan, that is a loan between the developer and his bank to finance the development, the bank must be vigilant in exercises their rights as debenture holder.

A conservative approach may result in chaos as if the bank is reluctant to step into the shoes of the developer, and even on some occasions financially assist. The errant developer would have fled leaving the project abandoned and the purchases without remedy.

This would leave the end financier, that is the purchasers’ bank in a total lurch. The bank and the purchasers are in no position to exercise any leverage, particularly against the delinquent developer.

The end financier is then left without the landed security to foreclose. The quite unlucky innocent purchaser continues to pay interest on his borrowings (and not principal). Sometimes, the best solution is for the purchaser to pay off the loan.

This is why we have avidly recommended that the end financier and the bridging financier be one and the same. Interestingly, who will push on this?

It would be in the end financier interest to push the bridging financier but ,it is the bridging financier that usually chosen first. Hence the prudent developer would push for the bridging financier to end finance. However, most prudent developers aren’t recalcitrant. Thus, should the burden fall back again on the innocent purchaser and homebuyer. Purchasers should be forewarned in instances where the bridging financier has not taken up the end financing as well.

Needless to say, as confusing all of this is, the solution provided above isn’t holistic and the purchaser must be left to fend for his own.

In a decided case, the purchasers formed a collective action legal committee and commenced legal proceedings for liquidated damages. One may ask what is the wisdom in this? Using the liquidated damages, the purchasers entered into a settlement with an independent contractor to complete the development using the unsold units. The end financiers supported the purchasers on this and became co-plaintiffs in some occasions. The developer succumbed to this on the threat of the purchasers’ winding up the developer. The independent contractor completed the project with some reservations. Thereafter, the purchasers wound up the developer appointed a provisional liquidator to complete the developer’s duties. A Committee of Inspection and Joint Management Body were set up etc.

This was an interesting solution to an intriguing problem.

The relevant bodies must ensure that there are safeguards put in place prohibiting and discouraging errant developers from manipulating this once “unguarded fence” which is still failing. The current push for developers to sell “completed units” even at a premium is still advantages in the authors’ opinion until a better solution to remedy the problem surfaces.

Negligence

Atkin vs Brightman

Lord Atkin's "neighbour" principle


“You must take reasonable care to avoid acts or omissions which you can reasonably foresee would be likely to injure your neighbour. Who, then, in law, is my neighbour? The answer seems to be — persons who are so closely and directly affected by my act that I ought reasonably to have them in contemplation as being so affected when I am directing my mind to the acts or omissions that are called in question”

In 1990, the case of Caparo Industries v. Dickman was decided by the House of Lord. Many commentaries have suggested that Caparo has now “narrowed” the famous dicta by Atkin.

In Caparo Industries v. Dickman [1990] 2 AC 605, the House of Lords established what is known as the "three-fold test",

duty of care to another is established by:-
·the harm must be a "reasonably foreseeable" result of the defendant's conduct
·a relationship of "proximity" between the defendant and the claimant
·it must be "fair, just and reasonable" to impose liability

The "three stage" test was first formulated by Bingham LJ

Blame

"All blame is a waste of time. No matter how much fault you find with another, and regardless of how much you blame him, it will not change you. The only thing blame does is to keep the focus off you when you are looking for external reasons to explain your unhappiness or frustration. You may succeed in making another feel guilty about something by blaming him, but you won't succeed in changing whatever it is about you that is making you unhappy." Wayne Dyer

The MV KUMAR Work Day

productivity and time management mantras

There are two ways to live: you can live as if nothing is a miracle; you can live as if everything is a miracle. .. Albert Einstein

Before Work Begin, Before You Leave & Anytime Necessary
Motivate/De-Stress/Visualize

Do not commence work in haste,
think about your short & long-term goals ...
steps needed

Mentally, take a step back and visualize yourself floating above your work place and looking down – you will definitely feel more relaxed, and you will probably see things in a different perspective.

Breathing .... very very important

"The practice of mindful breathing can lead to the release of all suffering." ... Margo Adair

Place hand on stomach. Make (Notice) your hand and stomach rise and fall when you breathe. Properly done, your chest will remain while your stomach will rise, when inhaling and vide versa. DO this on the counts of five.

Taking mental breaks like this might guide you towards a different direction in solving long-standing problems. Use this time to remotivate yourself, because unless you are motivated, you cannot motivate others. Also, making your work a pleasure will greatly diminish your stress.

Problems cannot be solved by the same level of thinking that created them. .. Albert Einstein

make a “to-do” list of things

If you don't know where you are going, any road will get you there. … Lewis Carroll

a) today’s
Set Priorities - High priority projects should also be done first - and then look into the lower priority jobs. If there are too many jobs for you to handle, delegate to jointly handle them

b) & Tomorrow‘s Draft list

Set Daily Goal
a) Estimating time accurately
b) Scheduling simple projects
c) Time planning for small and medium sized projects
d) Aides Memoire

An Aide Memoire (Memory aid) is a structured list of points that should be considered when solving a particular/specific problem –
considered all relevant factors, eg –

What CAN be done – no problemo,
What are usual problems/mistakes/”let downs”,
How to rise above the challenges, end results etc.

Often this makes the difference between carrying out a task effectively and making a mess of it, particularly when you are under pressure

Before you start some work, always ask yourself three questions –
(1) Why am I doing it,
(2) What the results might be; and
(3) Will I be successful.
Only when you think deeply and find satisfactory answers to these questions, go ahead… Chanakya

Focus on the Job At Hand
Instead of taking on too many tasks at one time and not completing most of them, concentrate on one job at a time and finish it off as quickly as possible. This will give you greater satisfaction on completion of those jobs.
This will reduce the risk of having to face the challenges in the items 5, 2 & 3 herein

Resolve Not To Procrastinate

Procrastination is the bane of the small business owner because every task has to get done sooner or later. If possible, get large tasks over with early in the morning, when you are still fresh and energetic.

Why do we Procrastinate?
You procrastinate when you put off things. Usually in favor of doing something that is more enjoyable or comfortable. Investing time in wrong tasks. Not understanding the difference between an urgent tasks and important tasks but jumping straight into it - reacting fast. Not thinking - driven by demands which are loudest.
Feeling overwhelmed by the task or Perfectionism ("I don't have the right skills or resources to do this perfectly now, so I won't do it at all."). A fear of failure or success. Waiting for the “right” mood or the “right” time to tackle the important task at hand.