Common use of Interest on the Deposit Clause in Contracts

Interest on the Deposit. (a) If this agreement is completed then the parties irrevocably authorise the Vendor’s Solicitors to pay all interest earned on the: (1) Initial Deposit to the Vendor; and (2) Final Deposit equally to the Vendor and the Purchaser. (b) If Completion does not occur because of a default of the Purchaser under this agreement or a Contemporaneous Contract then the parties irrevocably authorise the Vendor’s Solicitors to pay all interest earned on the Final Deposit to the Vendor. (c) If: (1) if Completion does not occur because of a default of the Vendor under this agreement or a vendor under a Contemporaneous Contract; or (2) if the Vendor terminates this agreement under clause 6.8, then the parties irrevocably authorise the Vendor’s Solicitors to pay all interest earned on the Final Deposit to the Purchaser. (d) Financial institutions duty, bank charges and other similar charges and expenses are to be deducted from the total amount of interest before the interest is paid under this clause 5.7. (e) The party or parties entitled to the Final Deposit and the interest on completion, termination or rescission of this agreement (whichever occurs) bear the risk of loss of the Final Deposit and of the interest. (f) The Vendor and the Purchaser must give such directions and do all things necessary to give effect to the provisions of this clause 5.7. Each party acknowledges that if it does not provide its Tax File Number to the Vendor’s Solicitors before the Final Deposit is invested then tax may be deducted from its share of interest on the Final Deposit. (g) Pending Completion, rescission or termination of this agreement, the Vendor and the Purchaser shall be deemed to be presently entitled in equal shares to any interest accrued on the Final Deposit. (h) The Vendor and the Purchaser jointly and severally indemnify the Vendor’s Solicitors and agree to keep the Vendor’s Solicitors indemnified for any liabilities, losses, costs, expenses or damages which the Vendor’s Solicitors may sustain or incur in any way under or in relation to the Final Deposit, including but not limited to, liabilities, costs (including legal costs) or expenses arising as a result of a dispute between the parties as to the ownership of the Final Deposit. The Purchaser holds the benefit of this clause for the Vendor’s Solicitors.