PART 2Key concepts
CHAPTER 2Provision about particular transactions
Interpretation
I114Meaning of “substantial performance”
1
A contract is substantially performed when—
a
the buyer, or a person connected with the buyer, takes possession of the whole, or substantially the whole, of the subject-matter of the contract,
b
a substantial amount of the consideration is paid or provided, or
c
there is an assignation, subsale or other transaction (relating to the whole or part of the subject-matter of the contract) as a result of which a person other than the original buyer becomes entitled to call for a conveyance to that person.
2
For the purpose of subsection (1)(a)—
a
possession includes receipt of rent or the right to receive it, and
b
it is immaterial whether possession is taken under the contract or under a licence.
3
For the purposes of subsection (1)(b), a substantial amount of the consideration is paid or provided—
a
if none of the consideration is rent, where the whole or substantially the whole of the consideration is paid or provided,
b
if the only consideration is rent, when the first payment of rent is made,
c
if the consideration includes both rent and other consideration, when—
i
the whole or substantially the whole of the consideration other than rent is paid or provided, or
ii
the first payment of rent is made.
4
For the purposes of subsection (1)(c) the reference to an assignation, subsale or other transaction includes the grant or assignation of an option.