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CQS - Standard Practice & Procedure. CQS Supporter. Contents. Introduction Learning Outcomes Part 1. Law Society Conveyancing Protocol Part 2. Standard Conditions of Sale Part 3. Law Society Code for Completion by Post Further Resources Next Steps. Introduction.

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Cqs standard practice procedure

CQS - Standard Practice & Procedure

CQS Supporter


Contents

Contents

  • Introduction

  • Learning Outcomes

  • Part 1. Law Society Conveyancing Protocol

  • Part 2. Standard Conditions of Sale

  • Part 3. Law Society Code for Completion by Post

  • Further Resources

  • Next Steps


Introduction

Introduction

Welcome to this official online training course and assessment for members of firms which have successfully applied for Year 2 re-accreditation under the Law Society’s Conveyancing Quality Scheme (the ‘CQS’).

Course authors

This training course was devised and written in March 2012 by Andrew Crawford and Peter Reekie.

Welcome

Click each name to find out more about the authors:

Peter Reekie

Andrew Crawford


Introduction1

Introduction

Peter Reekie

Andrew Crawford

Professor Peter Reekie is Property Training Consultant with Penningtons and Visiting Professor at The College of Law. Peter is also director of Peter Reekie Associates Ltd., which provides legal training services to lawyers and other professionals.

Previously he spent some years in private practice dealing with residential and commercial property work, worked for the College of Law and was managing director of Legal Network Television.

Peter writes for publication and lectures extensively at property law conferences, seminars and related events. He is Consultant Materials Editor for the College of Law’s Structured Commercial Property Programme and Consultant Editor of the Conveyancing Handbook 18th edition (Law Society, 2011).


Introduction2

Introduction

Peter Reekie

Andrew Crawford

Andrew Crawford works mainly for Central Law Training delivering a range of practical courses on residential conveyancing designed to help delegates be more efficient and knowledgeable in the office.

Andrew has worked in private practice throughout his career. He qualified in 1980 and became a partner with Thomas Eggar LLP in 1986 where he was responsible for a large residential property team based on five sites. Andrew left practice in 2010 to concentrate on his lecturing work.

Andrew is a past President of Chichester District Law Society. He has been involved in training for many years and is well known on the lecture circuit.


Learning outcomes

Learning Outcomes

The purpose of this course is to build upon the Year 1 CQS training on the Law Society Conveyancing Protocol.

Following this course candidates should be able to understand:

  • a number of important practical and procedural points raised by the Law Society Conveyancing Protocol;

  • certain key provisions of the Standard Conditions of Sale 5th Edition; and

  • a number of detailed aspects of the Law Society Code for Completion by Post.


Law society conveyancing protocol

Law Society Conveyancing Protocol

1. Law Society Conveyancing Protocol


Law society conveyancing protocol introduction

Law Society Conveyancing Protocol: Introduction

  • For many years the Law Society has set out its preferred practice for conveyancing transactions involving domestic freehold and leasehold property in a protocol.

  • The current Law Society Conveyancing Protocol(the ‘Protocol’) came into effect on 1 April 2011 and is at the heart of the CQS.

  • The Protocol comprises a set of general obligations, standard procedures in tabular form, and a timetable. The procedures are organised in stages (A-F) and modelled on a typical residential transaction. The Law Society has also produced A Guide to the Law Society Conveyancing Protocol to assist with the use and interpretation of the Protocol.

  • The tabular format shows what is expected of a firm acting for the seller, buyer and lender at each stage of transaction, and indicates when other parties such as the agent, and broker are involved.


Law society conveyancing protocol introduction1

Law Society Conveyancing Protocol: Introduction

  • Aims

  • The aims of the Protocol are, principally:

  • to ensure a good standard of conveyancing work is undertaken

  • by all those complying with the Protocol;

  • to set out an agreed method of working which will maximise efficiencies in the course of a transaction to those subscribing to it;

  • to improve communication between the parties and stakeholders;

  • to provide the parties and other stakeholders with an understanding of the residential conveyancing process.


  • Law society conveyancing protocol introduction2

    Law Society Conveyancing Protocol: Introduction

    • Use of the Protocol by the CQS

  • In order to be accredited under the CQS a firm must nominate a Senior Reporting Officer (SRO). The SRO must sign a Practice Agreementwith the Law Society which requires the SRO to:

  • The use of the Protocol ensures members of the CQS adhere to consistent quality standards and demonstrates the credibility of the firm to key stakeholders, including clients, regulators, lenders and insurers.

  • A firm accredited by the CQS should ‘still act within the spirit of the Protocol’ (A Guide to the Law Society Conveyancing Protocol, para.2.5).

  • If one party’s conveyancer does not agree to adopt the Protocol, this does not prevent its use by the other party’s conveyancer (see the Interpretation section of the Protocol).

  • ..use all reasonable endeavours to ensure that all Relevant Members of Staff within the Practice shall…comply with the new Conveyancing Protocol, as applicable…


    Law society conveyancing protocol introduction3

    Law Society Conveyancing Protocol: Introduction

    • Application of the Protocol

    • The Protocol is designed for use in sales and purchases of freehold and leasehold residential property.

    • At the commencement of a transaction it will be necessary to decide if the Protocol applies. To decide whether the Protocol applies, the Law Society recommends the following are considered:

    • ‘the use of the property;

    • the nature of the transaction;

    • the nature of the parties;

    • the nature of the contract;

    • the nature of any mortgage.’

    • (A Guide to the Law Society Conveyancing Protocol, para.2.4).

    • Having decided the Protocol applies there may still be matters in a specific transaction that make some deviation from the Protocol necessary and/or desirable.


    Law society conveyancing protocol introduction4

    Law Society Conveyancing Protocol: Introduction

    • Breach of the Protocol

    • Members of a firm accredited by the CQS are encouraged to report a suspected breach of the Protocol to the Law Society’s CQS team.

    • The Guide to the Law Society Conveyancing Protocol outlines, at para.2.5, the likely procedure when a firm accredited by the CQS which has agreed to adopt the Protocol fails to comply with its requirements:

    • A material breach or repeated breaches in the same transaction may result in CQS staff requiring the SRO to supply an explanation.

    • Repeated cases of serious default will be monitored.

    • Where necessary, monitored cases may be adjudicated under the membership rules of the CQS.

    • Repeated cases of serious default may result in expulsion from the Scheme.


    Law society conveyancing protocol introduction5

    Law Society Conveyancing Protocol: Introduction

    • General obligations

    • It is recommended that you familiarise yourself again with the 12 ‘general obligations’ which preface the Protocol. These obligations are explained in the ‘Interpretation’ section of the Protocol and in A Guide to the Law Society Conveyancing Protocol.

    • Firms are reminded at the beginning that the duty to act in the best interests of the client takes precedence over the provisions of the Protocol.

    • The first general obligation requires you to obtain agreement from the client to enable you to act in accordance with the Protocol. Other obligations provide, broadly, that:

    • you are required to deal with the person acting on the other side of the transaction in a courteous and helpful manner;

    • you agree to divulge information about the transaction and your client's circumstances, subject always to your overriding duty of confidentiality to your client.


    Question

    Question

    Is the following statement True or False?

    In order to comply with your Protocol obligations it would be sensible to explain to your client at the start about the requirement of disclosure and obtain their consent in writing to you disclosing relevant information concerning their transaction to the other side.

    True

    False


    Question1

    Question

    Is the following statement True or False?

    In order to comply with your Protocol obligations it would be sensible to explain to your client at the start about the requirement of disclosure and obtain their consent in writing to you disclosing relevant information concerning their transaction to the other side.

    True

    False

    The correct answer is True.

    (General obligation 1 requires you to seek instructions and set out the limits of the retainer, particularly in relation to obtaining the client’s agreement to act as the Protocol requires.)


    Law society conveyancing protocol stage a

    Law Society Conveyancing Protocol: Stage A

    Sharing information

    Item 4 of the Protocol requires each party’s conveyancer to establish if their respective client has a related sale/purchase, whether an offer has been accepted, and whether there is any ‘linked transaction or chain of transactions’.

    For example, the transaction may be linked to a re-mortgage of another property, and this information should be established and a discussion with the client should take place about the possible timetable in which the transaction might reasonably be completed.

    General obligation 7 states that you should ‘share information with others to assist in the efficient management of each transaction or chain of transactions’ if you have obtained the client's consent to the disclosure of information (and clients ‘should not encouraged to withhold authority unless there are exceptional circumstances’).


    Question2

    Question

    Is the following statement True or False?

    Under the Protocol you should reveal to the other side information about your client’s circumstances that might dictate the timing of the transaction or your client's ability to proceed, assuming your client has consented to this.

    True

    False


    Question3

    Question

    Is the following statement True or False?

    Under the Protocol you should reveal to the other side information about your client’s circumstances that might dictate the timing of the transaction or your client's ability to proceed, assuming your client has consented to this.

    True

    False

    The correct answer is True.

    (General obligation 7 requires you to ‘share information with others to assist in the efficient management of each transaction…’)


    Law society conveyancing protocol stage a1

    Law Society Conveyancing Protocol: Stage A

    If you are acting for a buyer, you must check whether the buyer is in rented accommodation and, if so, establish from your client details of their tenancy and its termination date or what arrangements might be needed to give notice to terminate (see Protocol: Item 4).

    Co-owners

    Where there is more than one buyer you will need to advise them ‘generally as to shared or joint ownership’ (Protocol: Item 4). Advice will include, for example, information on the various ways property may be held in joint names and whether an express declaration of trust should be drawn up.

    You will need to take detailed instructions and consider if more than one party is contributing a greater part of the purchase price or might in the future contribute a greater amount to the repayment of any mortgage or for any capital expenditure or any disproportionate payment in respect of outgoings.

    You should be conscious of the possibility of undue influence being exerted by one party against another and the risk of conflict in seeking to act for more than one client.

    Buyer in rented accommodation


    Law society conveyancing protocol stage a2

    Law Society Conveyancing Protocol: Stage A

    Surveys

    When acting for a buyer you should suggest the buyer ‘consults an independent surveyor for advice on valuation and survey’ (Protocol: Item 5).

    In practice caution should be exercised because it may be that some surveyors recommended by some estate agents might have financial connections with that estate agent or may be owned by an associated company of the estate agent

    A mortgage valuation report carried out on behalf of the lender to check the value of the property is not a survey.

    If acting for the lender, the conveyancer should also have regard to the provisions in the CML Lenders’ Handbook relating to the lender’s valuation report (section 4) or BSA Mortgage Instructions (C2-C6).


    Law society conveyancing protocol stage a3

    Law Society Conveyancing Protocol: Stage A

    Click each box to find out about the different types of survey:

    RICS Condition Report

    RICS HomeBuyer Report

    Building Survey


    Law society conveyancing protocol stage a4

    Law Society Conveyancing Protocol: Stage A

    Click each box to find out about the different types of survey:

    RICS Condition Report

    RICS HomeBuyer Report

    Building Survey

    This type of survey includes an inspection and a report in standard form by a surveyor. It does not include a market valuation nor opinion an on the reinstatement cost. It is intended for ‘a conventional house, flat or bungalow built from common building materials and in reasonable condition.’ The Report focuses on the condition of the property and includes:

    ‘•traffic light ratings of the condition of different parts of the building, services, garage and outbuildings, showing problems that require varying degrees of attention;

    • a summary of the risks to the condition of the building; and

    • other matters including guarantees, planning and building control issues for… legal advisers.’(RICS Home Surveys Information Sheet).

    For further information on survey types visit: www.rics.org and www.direct.gov.uk


    Law society conveyancing protocol stage a5

    Law Society Conveyancing Protocol: Stage A

    Click each box to find out about the different types of survey:

    RICS Condition Report

    RICS HomeBuyer Report

    Building Survey

    • The RICS HomeBuyer Report replaced the previous ‘RICS Homebuyer Survey and Valuation’. The HomeBuyer Report includes everything that’s in the cheaper Condition Report but also includes:

    • a market valuation;

    • an opinion of the reinstatement cost;

    • A ‘more extensive roof space and underground drainage inspection’ (RICS Home Surveys Information Sheet).

    • The reinstatement cost will help the buyer decide on the building insurance cover needed.

    For further information on survey types visit: www.rics.org and www.direct.gov.uk


    Law society conveyancing protocol stage a6

    Law Society Conveyancing Protocol: Stage A

    Click each box to find out about the different types of survey:

    RICS Condition Report

    RICS HomeBuyer Report

    Building Survey

    • The building survey (formerly the ‘structural survey’) is the most expensive and comprehensive option. The surveyor will make a detailed inspection of a wider range of issues. Unlike the Condition and Homebuyer Report, a building survey report does not come in a standard format. It gives detailed information about the structure and fabric of the property, and also aims to:

    • establish how the property is built, what materials were used, and how these will perform in future;

    • describe visible defects and expose potential problems posed by hidden defects;

    • outline the repair options

    • A building survey may be appropriate for ‘large, older or run-down property, a building that is unusual or altered, or if… planning major works.’ It does not include a market valuation nor an opinion on the cost of reinstatement.


    Question4

    Question

    Is the following statement True or False?

    The simplest of mortgage valuations carried out for a lender does not give detailed information concerning the fabric or condition of the building.

    True

    False


    Question5

    Question

    Is the following statement True or False?

    The simplest of valuations carried out for a lender does not give detailed information concerning the fabric or condition of the building.

    True

    False

    The correct answer is True.

    (A mortgage valuation is carried out to advise the lender of the value of a property and of any aspects of the property which might affect its value as security for the proposed loan.)


    Law society conveyancing protocol stage a7

    Law Society Conveyancing Protocol: Stage A

    • Source of funds (Protocol: Item 7)

    • The buyer’s conveyancer should:

    • ‘check availability, amount and source of deposit funds and purchase monies including whether a property is to be sold or mortgaged to provide funds’.

    • check whether any financial contribution is to be made by a third party and, if so, whether they require ‘external advice’.

    • consider the advice to be given to the lender in respect of such contributions if this needs to be disclosed under the terms of the CML Lenders’ Handbook, BSA Mortgage Instructionsor express instructions from the lender.


    Law society conveyancing protocol stage a8

    Law Society Conveyancing Protocol: Stage A

    If a contribution might affect the lender’s decision to lend then clearly it must be disclosed (with the borrower’s prior consent). If this consent is not forthcoming you must not continue to act for the lender.

    It is important to remember the general obligations of the Protocol in this respect, particularly:

    2. Where acting for a lender as well as for a buyer/seller, the duties owed to the lender are no less important than they are for any buyer/seller, subject to the nature of the instructions.


    Question6

    Question

    Is the following statement True or False?

    If you are acting for a borrower and lender you should not disclose to the lender information about your borrower client unless you have the consent of the borrower to do so.

    True

    False


    Question7

    Question

    Is the following statement True or False?

    If you are acting for a borrower and lender you should not disclose to the lender information about your borrower client unless you have the consent of the borrower to do so.

    True

    False

    The correct answer is True.

    (See general obligation 7 of the Protocol and Outcome 4.1 of the SRA Code of Conduct 2011)


    Law society conveyancing protocol stage a9

    Law Society Conveyancing Protocol: Stage A

    Buildings insurance

    When acting for a buyer you should suggest that they obtain quotations for buildings insurance and advise that the terms of any policy taken out must be compliant with the lender’s requirement, if applicable (Protocol: Item 7).

    You should be familiar with the provisions of the CML Lenders’ Handbook and BSA Mortgage Instructions, and check the Part 2 requirements specific to the appropriate lender regarding which risks the insurance must cover.

    In the Statement of Principles on the Provision of Flood Insurance (July 2008) the insurance industry agreed to continue to insure certain types of properties against flood risk. This agreement is due to expire in 2013. It is possible that clients buying in a flood risk area may in the future find that either insurance premiums are more costly than before or that this cover may not be available. It would be prudent to link your advice with regard to buildings insurance to any information that you might obtain through searches on flood risk. Further information and advice is available on the Defra website.


    Law society conveyancing protocol stage a10

    Law Society Conveyancing Protocol: Stage A

    Redemption of the mortgage

    When acting for a seller who is an existing borrower, Item 7 of the Protocol requires that you should obtain a redemption figure at an early stage and give advice on the cost of obtaining redemption statements and of obtaining any updates.

    You should read the redemption statement and notify the client of redemption penalties or negative equity. If there is negative equity or for some other reason the seller will not be able to discharge all the registered charges from the proceeds of sale the possible courses of action should be discussed with the seller.

    If aware a redemption statement is for information purposes only and that there’s a possibility of the client drawing down further monies before completion, which will increase the redemption figure, take extra care and advise the client accordingly.

    It is important not to make a commitment to discharge the mortgage by way of an undertaking which you might not be able to fulfil. The client should be advised of the risk of exchanging contracts where the debt may not yet be certain, e.g. an "all monies charge” or where the lender allows continuing credit to the borrower secured by a mortgage.


    Law society conveyancing protocol stage a11

    Law Society Conveyancing Protocol: Stage A

    Leasehold properties

    When you are acting for a seller of a leasehold property you should, at an early stage, ‘obtain the original lease or official copy of the lease’ (Protocol: Item 12(1)).

    You should also obtain from your client the contact details for the landlord and/or the managing agent and you should establish if a standard form of landlord/management company replies to enquiries can be obtained and, if so, the cost.

    You should also consider, with your client, whether to submit a questionnaire to the landlord or the managing agent at this time.

    You will need to consider if any third parties need to consent to the sale (e.g. the landlord or management company) and, if so, establish the costs of obtaining such consent. It ‘should generally be accepted that the seller will discharge this liability’ (Protocol: Item 12(5)).


    Law society conveyancing protocol stage b

    Law Society Conveyancing Protocol: Stage B

    Checking the identity of the other firm

    One of the aims of the Protocol is to reduce the opportunity for fraud. General obligation 4 requires a conveyancer adopting the Protocol to:

    Endeavour to maintain vigilance to protect and guard against fraudulent or other illegal behaviour encountered in the conveyancing process.

    A well managed firm adopting the Protocol will be able to assist in identifying a rogue firm. The key provisions of the Protocol in this respect are Items 21 and 22. Item 21 requires that, unless they are personally known to you, you should check the identity of the solicitor acting for the other party.

    You must also ‘follow the latest SRA and Law Society guidance and advice’ and ‘record and keep copies of evidence’ of identity of the firm(Protocol: Item 21)


    Law society conveyancing protocol stage b1

    Law Society Conveyancing Protocol: Stage B

    Checking the Identity of Other Firm: Law Society Advice

    The Law Society’s Mortgage Fraud Practice Note advises:

    • If you do not know [the conveyancer acting for the other side] you should check the recognised directory of their professional body.

    • Find a Solicitor

    • Directory of Licensed Conveyancers

    • You can also check a solicitor's details with the SRA over the telephone. Their contact number is 0870 606 2555.

    • Some fraudsters will try to assume the identity of professionals who actually exist. You should check that both the details and the final destination of documents match the details in the directory. You may consider contacting the firm directly by the contact details on the registry if you have concerns about the bona fides of the representatives on the other side to the transaction, particularly if there is a last minute change of representative.


    Law society conveyancing protocol stage b2

    Law Society Conveyancing Protocol: Stage B

    • Checking the identity of other firm

    • It is a requirement of Item 22 of the Protocol that you should contact the other party’s solicitor to establish:

    • the name of the conveyancer; and

    • the supervising solicitor or regulated principal.

    • You must also supply this information to the other side.

    • The purpose of this is to establish the identity of the fee earner and that the person responsible for the fee

    • earner’s work is duly qualified.


    Question8

    Question

    Is the following statement True or False?

    When acting for the buyer you need only request confirmation of the identity of the seller’s conveyancer and record and keep a copy of this evidence.

    True

    False


    Question9

    Question

    Is the following statement True or False?

    When acting for the buyer you need only request confirmation of the identity of the seller’s conveyancer and record and keep a copy of this evidence.

    True

    False

    The correct answer is False.

    (Item 22 of the Protocol requires you to confirm the name of the conveyancer and the supervising solicitor or regulated principal).


    Law society conveyancing protocol stage b3

    Law Society Conveyancing Protocol: Stage B

    Official copies

    Official copies, the title plan and copies of registered documents will have been obtained by the seller’s conveyancer at an earlier stage to establish title to the land and allow time to consider any defects (Protocol: Items 8 and 10).

    It is important for the conveyancer acting for the seller to ensure that entries in the register will be less than six months old at the time of submitting the contract bundle to the buyer’s conveyancer (Protocol: Item 12(2)).


    Law society conveyancing protocol stage b4

    Law Society Conveyancing Protocol: Stage B

    • Planning consents

    • If alterations or additions to the property have been carried during the seller’s ownership, the Protocol requires the seller’s conveyancer to include in the contract bundle:

    • planning permissions and/or building regulations consents and completion certificates; and

    • confirmation that the originals of the building plans will be handed over at completion, if these are being held (Protocol: Item 24(6)).

    • When acting for a buyer you should consider whether any further planning documentation is required and also whether this might be obtained from the local authority or planning authority website.

    • If any planning permissions were issued more than 20 years ago, the buyer’s solicitor should seek to obtain copies directly from the appropriate planning authority and not expect the seller to provide these (Protocol: Item 31).


    Law society conveyancing protocol stage b5

    Law Society Conveyancing Protocol: Stage B

    • Additional enquires

    • When acting for a buyer in receipt of the contract bundle from the seller’s conveyancer you should only raise those specific additional enquiries which are:

    • required to clarify issues arising out of the documents submitted;

    • relevant to the particular nature or location of the property;

    • expressly requested by the buyer (Item 32).

    • The purpose behind this Protocol requirement is to reflect the conveyancer’s duty to deal with matters of legal relevance and to avoid the conveyancer having to spend time on other matters that could be outside their expertise or retainer and could more properly be dealt with by the buyer’s own inspection, enquiry or by the employment of a surveyor.

    Indiscriminate use of ‘standard’ additional enquiries may constitute a breach of the Protocol. If such enquiries are submitted, the Protocol does not require the seller’s solicitor to deal with them (Protocol: Item 32).


    Question10

    Question

    Is the following statement True or False?

    Your firm uses a set of standard additional enquiries and sends these out on the occasion of each purchase. This is okay to do under the Protocol.

    True

    False


    Question11

    Question

    Is the following statement True or False?

    Your firm uses a set of standard additional enquiries and sends these out on the occasion of each purchase. This is okay to do under the Protocol.

    True

    False

    The correct answer is False.

    (Indiscriminate use of ‘standard enquiries’ may be a breach of the Protocol under Item 32.)


    Law society conveyancing protocol stage d

    Law Society Conveyancing Protocol: Stage D

    From TA13 Completion Information and Undertakings (2nd edition)

    Form TA13 is a Law Society form, last updated in 2011 to coincide with the new edition of the Protocol. A copy of the form can be viewed here.

    Previous editions of the form were known as Completion Information and Requisitions on Title.

    Use of Form TA13 is required by the Protocol (Item 53) and by the Law Society Code for Completion by Post(para.5).

    The current Protocol introduced a change which requires form TA13 to be completed by the seller’s solicitor or licensed conveyancer and sent to the other side without waiting for a request to do so.


    Law society conveyancing protocol stage d1

    Law Society Conveyancing Protocol: Stage D

    • Transfer

    • The seller's solicitor should, prior to completion, supply a copy of the transfer that has been executed by the seller and which is intended to be handed over at completion (Protocol Item 56).

    • The purpose of this provision is to:

    • allow the buyer’s solicitor to check that execution of the transfer is satisfactory (e.g. to check that it has it been properly witnessed); and

    • allow the buyer’s conveyancer to satisfy himself there is no doubt that the transfer has indeed been signed.


    Law society conveyancing protocol stage d2

    Law Society Conveyancing Protocol: Stage D

    Transfer

    If the transfer needs to be signed by both the seller and the buyer it may be that there is insufficient time for the single form of transfer to be signed by both parties. In this situation the buyer may well have to execute a counterpart of the transfer. This is an approved procedure under the Protocol (Item 57.).

    In the Standard Conditions of Sale (5th edition) clause 4.3.2 provides for the buyer to produce the form of transfer. There is nothing in the Protocol that prevents this from being lawfully varied by the parties where necessary.

    (A Guide to the Law Society Conveyancing Protocol, para.4.4.)

    Many solicitors acting for the seller may draft the transfer and obtain the seller’s signature to it along with the sale contract in order to reduce the time required between exchange of contracts and completion. If this is done, the seller’s solicitor should submit a copy of the executed transfer to the buyer’s solicitor in advance in order to ensure that any corrections that may be required are undertaken prior to completion.


    Law society conveyancing protocol stage d3

    Law Society Conveyancing Protocol: Stage D

    • Official search

    • Item 57 of the Protocol requires the buyer's conveyancer to prepare and submit at ‘the appropriate time’:

    • an official search of the register with priority at the Land Registry (or a land charges search if the land is unregistered); and

    • a search of the bankruptcy register against the borrower’s name where acting for a lender.

    • It is obviously important to time the submission of your Land Registry search to maximise the priority period available to you post completion in order to complete your registration within this period. However, it is equally important not to leave the submission of the search until immediately prior to completion in case there is an adverse entry revealed which needs some investigation.

    It would therefore generally be appropriate to aim to receive your search result in good time to react to any untoward entries, e.g. at least five days before the completion date.


    Law society conveyancing protocol stage d4

    Law Society Conveyancing Protocol: Stage D

    Payment of the purchase price

    When acting for a buyer and obtaining funds from a lender you should send the certificate of title and/or requisition for funds to the lender or lender’s solicitor ‘promptly’ (Protocol: Item 80).

    Where the advance is to be sent by CHAPS, request wherever possible, that the lender’s advance is sent one working day before completion.

    You should notify the buyer, if applicable, that interest may be charged by the lender from the day of transmission.


    Law society conveyancing protocol stage e

    Law Society Conveyancing Protocol: Stage E

    Adopting the Law Society Code for Completion by Post

    The Law Society Code for Completion by Post(the ‘Code’), last revised in April 2010, contains various obligations and undertakings that must be adhered to by a firm that adopts the Code.

    The reason that the Code is not an integral part of the Protocol is because the Code might be used where the Protocol is not being adopted e.g. in a commercial conveyancing transaction.

    If you agree to adopt the Protocol you will be impliedly agreeing to adopt the Code, where completion is to be by post (Protocol: Item 61)


    Standard conditions of sale

    Standard Conditions of Sale

    2. Standard Conditions of Sale


    Standard conditions of sale1

    Standard Conditions of Sale

    • The 5th edition of the Standard Conditions of Sale (the ‘SCS’) came into effect on 1 April 2011. The revisions were made to:

    • Bring the SCS in line with a number of changes in case law and practice.

    • Reduce the need for practitioners to use special conditions.

    • Improve integration with the newly revised Protocol and to support the launch of the CQS.


    Standard conditions of sale2

    Standard Conditions of Sale

    • Standard form incorporating the SCS

    • Where a firm is a member of the CQS and is dealing with a transaction covered by the Protocol it must use the most up-to-date version of forms provided by the Law Society (Protocol: general obligation 11).

    • A form of standard contract which incorporates the SCS has been created by the Law Society. This standard form includes, amongst other items:

    • space to record the details of exchange; and

    • certain ‘special conditions’, including a convenient form of occupier’s consent.

    • This form of contract incorporating the current SCS is available to view online at the Law Society’s website.


    Standard conditions of sale3

    Standard Conditions of Sale

    • Standard form incorporating the SCS

    • The Protocol also requires use of a contract that incorporates the latest edition of the Standard Conditions of Sale, broadly without the addition of further clauses.

    • Item 24(1) of the Protocol discourages the addition of further clauses unless

    • they are necessary to accord with the current law; or

    • specific and informed instructions have been given by the seller and inclusion of such clauses are necessary and they are required for the purposes of the particular transaction.

    • This is subject to the overriding principle that the firm must always act in the best interest of the client (See Protocol: General obligations). The best interests of the client may be best served by drafting a contract that is not overly prejudicial to the buyer. This should ensure there is no undue delay or increase of costs through protracted negotiations. It is important to “consider the main objective of the client in the transaction” (A Guide to the Law Society Conveyancing Protocol, para 3.1).


    Standard conditions of sale4

    Standard Conditions of Sale

    Enforcement of the obligation

    Enforcement of compliance with the requirements of the CQS, including the obligation regarding additional clauses explained above, is a matter for the Law Society.

    Where a member firm fails to adhere to the requirements of the Scheme it may be referred to the Law Society. Potentially the firm’s membership of the Scheme may ultimately be in jeopardy. 


    Question12

    Question

    Is the following statement True or False?

    You are supplied with a contract by a firm that is a member of the CQS. This includes a clause as follows:

    “The buyer acknowledges and agrees that any replies to enquiries by the buyer are given without liability on the part of the seller's solicitors.”

    The firm refuse to delete the clause saying that they regard it as being in the best interests of their client.

    You can justifiably refer the firm to the Law Society.

    True

    False


    Question13

    Question

    Is the following statement True or False?

    You are supplied with a contract by a firm that is a member of the CQS. This includes a clause as follows:

    “The buyer acknowledges and agrees that any replies to enquiries by the buyer are given without liability on the part of the seller's solicitors.”

    The firm refuse to delete the clause saying that they regard it as being in the best interests of their client.

    You can justifiably refer the firm to the Law Society.

    True

    False

    The correct answer is True. (The clause is in the interests of the solicitors, rather than their client.)


    Standard conditions of sale5

    Standard Conditions of Sale

    • Changes to the previous version of the standard contract

    • Some of the main areas where the latest version of the contract differs from the previous version are as follows:

    • The word ‘chattels’ in the previous edition of the contract has become ‘contents’.

    • In addition to a provision that the buyer may not transfer the benefit of the contract, Condition 1.5.2 also provides that the seller cannot be required to transfer the property in parts or to any person other than the buyer.

    • The standard conditions no longer regulate the common law implied grant rules that operate on a sale of part.

    • Other key changes are considered in more detail in the coming pages.


    Standard conditions of sale6

    Standard Conditions of Sale

    Standard conditions relating to insurance

    The previous edition of the SCS provided, in effect, that the risk of damage to the property between exchange and completion was to remain with the seller. This was because the standard conditions also provided that the buyer was entitled to rescind the contract if the property was “unusable for its purpose” at the date of the contract.

    In practice many practitioners became concerned about the possible practical consequences of the clause. In a chain transaction these consequences arose from the fact that if there had been significant damage the seller may have lost his sale but would still be bound to buy his or her related property. Therefore it became common to reverse the position under the standard conditions.

    The SCS 5th edition follows what had become standard drafting practice to provide that the property is at the risk of the buyer from the date of the contract (SCS: Condition 5.1.1).


    Standard conditions of sale7

    Standard Conditions of Sale

    Double insurance

    The fact that the risk in the property passes to the buyer on exchange of contracts does not mean that the seller is not entitled to insure during the period between exchange and completion.

    As buyers will insure from exchange as well as sellers there may be two insurance policies covering the same loss.

    Condition 5.1.5 clarifies the position regarding ‘double insurance’. It provides that where the property is damaged and a payment under a policy taken out by a buyer is reduced because of insurance held by the seller, broadly, the purchase price is to be abated by the amount of that reduction. This does not apply where the buyer is obliged to insure under Condition 5.1.2 (see below).

    The prudent seller will continue to insure the property during this period, and they will normally be required to do so by the terms of their existing mortgage in any event.


    Standard conditions of sale8

    Standard Conditions of Sale

    • Where the seller should continue to insure

    • There are situations where, due to the nature of the transaction, the buyer should not have to insure. In this case it will be necessary to insert a special condition to oblige the seller to maintain insurance (Condition 5.1.2(a)).

    • One of the most likely situations where the issue will arise is where property insurance will not be available to the buyer. Particular situations where insurance may not be available to the buyer include the following:

    • The buyer may be unable to obtain cover due to the insurance market. (This may arise, for example, where there is to be an extended period in which the property is unoccupied by the buyer, so where there is a long period between exchange and completion.)

    • The property is in the course of construction.

    It will be important to consider the position regarding the availability of insurance to the buyer before exchange.


    Standard conditions of sale9

    Standard Conditions of Sale

    • Where the seller is obliged to insure by a lease

    • The second situation where it is inappropriate for the buyer to insure on exchange is dealt with in Condition 5.1.2(b). This is where the seller is obliged to maintain insurance under the terms of a lease to which the property is subject.

    • Where the seller is obliged to insure in either circumstances, the SCS impose further obligations on the seller in Condition 5.1.3. These include, broadly:

    • an obligation on the seller to maintain the insurance; and

    • if the property is damaged, in certain circumstances to:

    • pay to the buyer the amount of the policy money which the seller receives; or

    • assign the claim to the buyer.

    • Where the property is leasehold and, broadly, insurance has been taken out by the landlord, Condition 5.1.4 obliges the seller to use reasonable endeavours to ensure that the insurance on the property is maintained until completion and, if the building suffers any damage, to assign to the buyer any rights to the policy monies.


    Question14

    Question

    Is the following statement True or False?

    You are acting in the sale of a house held on a long lease. The terms of the lease provide that the tenant is to insure the property. Contracts have just been exchanged.

    You should ensure that the seller cancels his insurance immediately as the risk will pass to the buyer under the contract. The buyer will need to comply with the lease covenant from exchange.

    True

    False


    Question15

    Question

    Is the following statement True or False?

    You are acting in the sale of a house held on a long lease. The terms of the lease provide that the tenant is to insure the property. Contracts have just been exchanged.

    You should ensure that the seller cancels his insurance immediately as the risk will pass to the buyer under the contract. The buyer will need to comply with the lease covenant from exchange.

    True

    False

    The correct answer is False.

    The correct answer is False. (See Standard Condition 5.1.2 (b)).


    Standard conditions of sale10

    Standard Conditions of Sale

    Standard condition relating to time for completion

    Standard conditions 6.1.2 and 6.1.3 provide, in effect, that if the money due at completion is received after 2.00 pm on the day of completion then completion is deemed to have taken place, for certain purposes, on the next working day due to the buyer’s default.

    This deeming provision is for the purposes of the calculation of compensation at the agreed interest rate, and for the calculation of any apportionments.

    However, this does not apply and the seller is treated as in default if, broadly, the sale is with vacant possession and the seller had not vacated the property at that time and otherwise the buyer was ready, able and willing to complete.


    Standard conditions of sale11

    Standard Conditions of Sale

    Specifying the time for completion

    Special condition 5 of the Law Society form of contract incorporating the SCS provides for an amendment to the standard conditions which enables a time other than 2.00 pm to be specified for the time after which completion is treated as taking place on the next working day.

    2.00 pm should be sufficient where the seller has no related purchase. This time should ensure that the receipt of the money is cleared by the firm’s bank in good time so that the money can be remitted to the seller on the day of completion (see Conveyancing Handbook 18th edition, para.F1.2.3).

    In some cases the specified time may have to be earlier where it will be necessary for the money received on a sale to be used for a related purchase transaction. If it will be necessary for the funds to be used for a purchase on the same day, sufficient time must be allowed for the bank to process the transfer of funds. Where there are a number of transactions on the same day, a significantly earlier time may have to be specified.


    Question16

    Question

    Is the following statement True or False?

    You are acting in the sale of a house. You have submitted a draft contract to the buyer’s solicitor. The buyer’s solicitor asks if the time for completion can be altered to 4.30pm. She justifies this by explaining that there is a very long chain and that as your client is at the end of the chain with no related purchase the time of transmission of the money will be immaterial to your client.

    You should insist on a time no later than is prudent to ensure that the money will be cleared and available to draw against that day. Normally, in a situation like this a completion time of 4.30pm is acceptable.

    True

    False


    Question17

    Question

    Is the following statement True or False?

    You are acting in the sale of a house. You have submitted a draft contract to the buyer’s solicitor. The buyer’s solicitor asks if the time for completion can be altered to 4.30pm. She justifies this by explaining that there is a very long chain and that as your client is at the end of the chain with no related purchase the time of transmission of the money will be immaterial to your client.

    You should insist on a time no later than is prudent to ensure that the money will be cleared and available to draw against that day. Normally, in a situation like this a completion time of 4.30pm is acceptable.

    True

    False

    The correct answer is False.


    Standard conditions of sale12

    Standard Conditions of Sale

    • Standard conditions relating to deposit funds transfer

    • Conditions 2.2.4-2.2.6 provide for the transfer of deposit funds, but do not apply to sale by auction.

    • Payment of deposit by electronic means

    • The deposit is paid:

    • FROM an account held in the name of a conveyancer at a clearing bank

    • TO an account in the name of the seller’s conveyancer or, where the deposit is to be used by the seller to buy another property in England and Wales, a conveyancer nominated by him and maintained at a clearing bank.

    • Payment of deposit by cheque

    • The deposit is paid by a cheque drawn on a solicitor’s or licensed conveyancer’s client account to the seller’s conveyancer or, where the deposit is to be used by the seller to buy another property in England and Wales, to a conveyancer nominated by him.


    Standard conditions of sale13

    Standard Conditions of Sale

    Standard conditions relating to completion funds transfer

    Payment of the money due on completion is dealt with in SCS 6.7, which provides that:

    These changes to the transfer of completion funds and the changes to transfer of deposit funds described above are designed to help in dealing with the problems of fraud and money laundering issues as the seller’s solicitors do not have to accept money other than from a conveyancer.

    The buyer is to pay the money due on completion by a direct transfer of cleared funds from an account held in the name of a conveyancer at a clearing bank and, if appropriate, an unconditional release of a deposit held by a stakeholder.


    Question18

    Question

    Is the following statement True or False?

    You act for a buyer and you have exchanged contracts in relation to the purchase of a freehold property. The contract incorporates the SCS (unamended). Your client now informs you that he would like you to obtain the mortgage advance and pay this to the seller’s solicitor in the usual way on the day of completion. However, the balance of the purchase price will be paid by his father and will be sent by his father’s solicitors direct to the seller’s conveyancer.

    You advise him that this is not possible as the contract requires payment by you to the seller’s conveyancer.

    True

    False


    Question19

    Question

    Is the following statement True or False?

    You act for a buyer and you have exchanged contracts in relation to the purchase of a freehold property. The contract incorporates the SCS (unamended). Your client now informs you that he would like you to obtain the mortgage advance and pay this to the seller’s solicitor in the usual way on the day of completion. However, the balance of the purchase price will be paid by his father and will be sent by his father’s solicitors direct to the seller’s conveyancer.

    You advise him that this is not possible as the contract requires payment by you to the seller’s conveyancer.

    True

    False

    The correct answer is False. (The word “conveyancer” includes a solicitor (SCS 1.1.1)).


    Standard conditions of sale14

    Standard Conditions of Sale

    Standard conditions in relation to outstanding money at completion

    Occasionally money payable under the contract is unavailable at completion. For example, the contract may provide that the buyer has agreed to pay a contribution towards the seller’s legal costs. If this money is not paid at completion the question arises as to whether completion can be delayed (or ultimately the contract can be rescinded) if this is not paid.

    In order to provide certainty on this issue SCS 6.4 states:

    The amount payable by the buyer on completion is the purchase price and the contents price (less any deposit already paid to the seller or his agent) adjusted to take account of:

    apportionments made under condition 6.3

    any compensation to be paid or allowed under condition 7.2

    any sum payable under condition 5.1.3.

    (SCS 6.4(c) refers to the seller’s obligation to pay to the buyer the amount of insurance policy money which the seller receives in certain circumstances.)


    Standard conditions of sale15

    Standard Conditions of Sale

    Standard conditions in relation to outstanding money at completion

    Where there is no specific provision in the contract requiring a payment (apart from those payments covered by Condition 6.4) to be made on completion or permitting completion to be delayed in this case, it would appear that completion must proceed and the injured party must enforce his or her remedy by other means (see Chinnock v. Hocaoglu[2008] EWCA 1175).

    In the example given on the previous page, unless the contract provides that the amount payable on completion must specifically include the contribution towards the legal costs, then completion cannot be delayed, nor ultimately may the contract be rescinded if this sum is not paid at completion.


    Question20

    Question

    Is the following statement True or False?

    You act for a seller. Contracts incorporating the SCS were exchanged for the sale of a property. There was a special condition which provided that the purchaser will be responsible for the legal costs incurred by the seller in relation to the sale and that standard condition 6.4 is to be amended accordingly. Completion is delayed and you serve a completion notice. On the final day on which completion must take place you receive all the sums due from the buyer except this sum.

    You can now treat the contract as at an end due to the buyer’s default.

    True

    False


    Question21

    Question

    Is the following statement True or False?

    You act for a seller. Contracts incorporating the SCS were exchanged for the sale of a property. There was a special condition which provided that the purchaser will be responsible for the legal costs incurred by the seller in relation to the sale and that standard condition 6.4 is to be amended accordingly. Completion is delayed and you serve a completion notice. On the final day on which completion must take place you receive all the sums due from the buyer except this sum.

    You can now treat the contract as at an end due to the buyer’s default.

    True

    False

    The correct answer is True


    Standard conditions of sale16

    Standard Conditions of Sale

    Standard conditions relating to management companies

    Where the lease (or some other document) requires the seller to be a member of a management company the SCS requires the seller (at his or her own cost) to provide any necessary documents to enable the buyer to become a member of the company (Condition 4.7). These would often include a membership or share certificate and a stock transfer form.

    This amendment was made to bring the standard conditions into line with what had become a fairly common special condition.

    The Protocol also provides at Item 24(8) that, in relation to leasehold property, it is for the seller’s conveyancer to prepare and submit in the contract bundle: ‘(iv) a copy of the seller’s share certificate for any landlord/management company where appropriate’.


    Question22

    Question

    Is the following statement True or False?

    You act for a buyer. Contracts incorporating the SCS were exchanged for the sale of a leasehold property. The property is held under the terms of a lease that provides for the tenant to be a member of the management company. The seller’s solicitor has supplied you with a copy of the seller’s share certificate for the management company. You receive a completion statement that shows an additional sum required to be paid of £50.00 to cover the costs of transferring the share. You should inform your client that this sum is payable under the terms of the standard conditions of sale.

    True

    False


    Question23

    Question

    Is the following statement True or False?

    You act for a buyer. Contracts incorporating the SCS were exchanged for the sale of a leasehold property. The property is held under the terms of a lease that provides for the tenant to be a member of the management company. The seller’s solicitor has supplied you with a copy of the seller’s share certificate for the management company. You receive a completion statement that shows an additional sum required to be paid of £50.00 to cover the costs of transferring the share. You should inform your client that this sum is payable under the terms of the standard conditions of sale.

    True

    False

    The correct answer is False. (See Standard Condition 4.7.)


    Law society code for completion by post

    Law Society Code for Completion by Post

    3. Law Society Code for Completion by Post


    Law society code for completion by post1

    Law Society Code for Completion by Post

    Background to the Law Society Code for Completion by Post

    The process of completion is generally little regulated by either the SCS or by special conditions.

    The Law Society’s Code for Completion by Post (the ‘Code’) is designed to:

    …provide solicitors with a convenient means for completion on an agency basis when a representative of the buyer’s solicitor is not attending at the office of the seller’s solicitor.

    (Notes to the Code, para.2)

    The Code facilitates this type of completion by laying down a set of procedures supported by undertakings given on a standard form (Form TA13).


    Law society code for completion by post2

    Law Society Code for Completion by Post

    Adopting the Code

    Members of the CQS are obliged to use the Protocol. If completion is to be by post, the Protocol requires both parties to:

    …comply with the Law Society Code for Completion by Post without variation unless instructions are given by the client and are specific to the needs of the individual transaction. General exclusions of liability for obligations within the Code will be viewed as a breach of this Protocol.

    (Protocol: Item 61)

    Outside of the types of transactions covered by the Protocol, the Code has become “industry standard” and is often adopted in other residential and commercial conveyancing transactions by agreement.


    Law society code for completion by post3

    Law Society Code for Completion by Post

    General requirements of the Code

    The Code contains a number of steps to be followed by the parties’ solicitors before completion, including, at para.8:

    The buyer’s solicitor may send the seller’s solicitor instructions as to any other matters required by the buyer’s solicitor which may include:

    documents to be examined and marked;

    memoranda to be endorsed;

    undertakings to be given;

    deeds or other documents including transfers and any relevant undertakings and authorities relating to rents, deposits, keys, to be sent to the buyer’s solicitor following completion;

    consents, certificates or other authorities that may be required to deal with any restrictions on any Land Registry title to the property;

    Executed stock transfer forms relating to shares in any companies directly related to the conveyancing transaction.


    Question24

    Question

    Is the following statement True or False?

    You act for the buyer in a leasehold transaction covered by the Protocol and you have exchanged contracts. As there is a requirement under the lease that the tenant is a member of the management company you ask the seller’s solicitor to arrange for the transfer of the seller’s share to your client. The seller’s solicitor refuses to deal with this and suggests your client arranges this direct with the seller.

    You can require the seller’s solicitor to supply the stock transfer form under the terms of the Code.

    True

    False


    Question25

    Question

    Is the following statement True or False?

    You act for the buyer in a leasehold transaction covered by the Protocol and you have exchanged contracts. As there is a requirement under the lease that the tenant is a member of the management company you ask the seller’s solicitor to arrange for the transfer of the seller’s share to your client. The seller’s solicitor refuses to deal with this and suggests your client arranges this direct with the seller.

    You can require the seller’s solicitor to supply the stock transfer form under the terms of the Code.

    True

    False

    The correct answer is True


    Law society code for completion by post4

    Law Society Code for Completion by Post

    • Undertakings

    • The Code contains a number of undertakings. The principle ones are outlined in abbreviated form below. (In this section the letter “S” represents the seller’s solicitor and the letter “B” represented the buyer’s solicitor):

    • B will use reasonable endeavours to obtain funds from the buyer and the lender in good time for completion. (It is considered by many to be best practice to request the advance from the lender, if possible, to arrive the day before completion and also prompt the lender by telephone.)

    • S will, generally, provide replies to Form TA13 Completion, Information and Undertakings at least five days before completion.

    • S will specify the charges to be redeemed or discharged on completion.


    Question26

    Question

    Is the following statement True or False?

    You act for the buyer in a transaction covered by the Protocol. Contracts have been exchanged and completion is due in a few days.

    The Code requires you to wait until the day before completion to apply for the mortgage advance money.

    True

    False


    Question27

    Question

    Is the following statement True or False?

    You act for the buyer in a transaction covered by the Protocol. Contracts have been exchanged and completion is due in a few days.

    The Code requires you to wait until the day before completion to apply for the mortgage advance money.

    True

    False

    The correct answer is False.

    (Para.4 of the Code requires the buyer’s solicitor to ensure funds are collected from the lender in good time to send to the seller’s solicitor.)


    Law society code for completion by post5

    Law Society Code for Completion by Post

    • Undertakings concerning authority

    • Further undertakings are given under the Code in connection with the authority of the seller’s solicitors to receive the purchase money. Thus:

    • S has the seller’s authority to receive purchase money

    • S has authority of the lender to receive redemption money

    • In either case if S does not have the relevant authority S will notify B by 4.00 pm on the working day before completion and will not to complete without B’s instructions.


    Law society code for completion by post6

    Law Society Code for Completion by Post

    Undertakings concerning authority

    In so far as the lender’s authority is concerned:

    …While the seller’s solicitor will often not be specifically instructed by the seller’s mortgagee, the course of dealings between the solicitor and mortgagee in relation to the monies required to redeem the mortgage should at the very least evidence implicit authority from the mortgagee to the solicitor to receive the sum required to repay the charge (if, for example, the mortgagee has given its bank details to the solicitor for transmission of the redemption funds).

    (Notes to the Code, Para.5)


    Question28

    Question

    Is the following statement True or False?

    You act for the seller in a transaction covered by the Protocol.

    The Law Society’s Code for Completion by Post states that is necessary to have the express consent in writing of the lender that you may act for it in the transaction. Failing this any undertaking to discharge the mortgage is void.

    True

    False


    Question29

    Question

    Is the following statement True or False?

    You act for the seller in a transaction covered by the Protocol.

    The Law Society’s Code for Completion by Post states that is necessary to have the express consent in writing of the lender that you may act for it in the transaction. Failing this any undertaking to discharge the mortgage is void.

    True

    False

    The correct answer is False.

    (See Notes to the Code, para.5.)


    Law society code for completion by post7

    Law Society Code for Completion by Post

    • Undertakings dealing with completion

    • Further undertakings are given that, broadly:

    • S will complete on receipt of completion money.

    • S will comply with any agreed completion arrangements.

    • S will redeem the specified charges.

    • S has identified the existing lender to the extent necessary for B to apply for registration.

    • Immediately after completion that S will hold the specified documents to B’s order (and will not exercise a lien over them).

    • Broadly, this lien arises in favour of a seller where part or all of the purchase money is outstanding and it includes a right to retain title documents (see further Conveyancing Handbook 18th Edition, para.M8).


    Law society code for completion by post8

    Law Society Code for Completion by Post

    The retention of documents of title on completion could otherwise cause problems for a buyer as he will be unable to register his title, even though the seller may have completed and utilised the majority of the purchase price.

    So, for example, the Code makes provision for the parties to be able to agree to complete where some of the purchase money remains outstanding

    The seller’s solicitor will complete upon becoming aware of the receipt of the sum specified in paragraph 9, or a lesser sum should the buyer’s and seller’s solicitors so agree… (Code para.10)

    Therefore, say a small sum in respect of compensation due for late completion is not paid at completion. If the seller wishes to complete and utilise the proceeds of sale he must not exercise his lien and retain the transfer and other documents until the balance is paid.

    Alternatively, if the seller wants to do this, the seller’s solicitor must, before completing, agree with the buyer’s solicitor that the undertaking in respect of the lien is varied to permit this.


    Question30

    Question

    Is the following statement True or False?

    Where all the completion money due on completion is not paid on that date by the buyer, the seller may elect to either complete or not. If he elects to complete he may retain the documents of title as he has a lien over them. The Code automatically preserves this right and no amendment is required to the undertakings given under it. It expressly provides for the buyer’s solicitor to hold any documents to the order of the seller’s solicitors in these circumstances.

    True

    False


    Question31

    Question

    Is the following statement True or False?

    Where all the completion money due on completion is not paid on that date by the buyer, the seller may elect to either complete or not. If he elects to complete he may retain the documents of title as he has a lien over them. The Code automatically preserves this right and no amendment is required to the undertakings given under it. It expressly provides for the buyer’s solicitor to hold any documents to the order of the seller’s solicitors in these circumstances.

    True

    False

    The correct answer is False.

    (See the Code, para.12(i).)


    Law society code for completion by post9

    Law Society Code for Completion by Post

    • Undertakings Relating to Post Completion Matters

    • Further undertakings are given so that:

      • as soon as possible after completion S will confirm to B that completion has taken place and will notify the key holder.

      • S will send the relevant documents to B by the end of the working day following completion.

      • If electronic discharge is to be used S will notify B as soon as notification of discharge received.


    Law society code for completion by post10

    Law Society Code for Completion by Post

    Adopting the Code

    Use of the Code is automatically implied by Item 61 of the Protocol. Agreement in writing is also given by an affirmative answer to the following question in Form TA13:

    ‘3.2If we wish to complete through the post, please confirm that:

    (a) You undertake to adopt the Law Society Code for Completion by Post;…’

    Note that question 5.2 of Form TA13 also asks:

    ‘Do you undertake to redeem or discharge the mortgages and charges… on completion and to send us Form DS1, DS3, the receipted charge(s) or confirmation that notice of release or discharge in electronic form has been given to the Land Registry as soon as you receive them?’

    ‘To adopt this code, both solicitors must agree, preferably in writing, to use it to complete a specific transaction, except that the use or adoption of the Law Society Conveyancing Protocol automatically implies use of this code unless otherwise stated by the either solicitor’ (Code, para.1)


    Law society code for completion by post11

    Law Society Code for Completion by Post

    Timing of Form TA13 Completion Information and Undertakings

    This form should be sent by the seller’s solicitor to the buyer’s solicitor with the answers completed, i.e. without waiting for a request after exchange and at least five days before completion. (See Protocol Item 50 and the Code, para.5.)

    The practice is developing for some sellers’ solicitors to send this form with the draft contract to the buyer. Caution should be exercised in these cases. For example, it is extremely imprudent for a seller’s solicitor to give an undertaking to discharge the existing mortgage where no contract to sell the property has been exchanged. It is understood that some sellers’ solicitors are dealing with this issue by omitting to answer the relevant questions concerning undertakings.

    It is important to ensure in these cases that this is followed up on exchange and the omitted affirmative answers are supplied at this point.


    Further resources

    Further Resources

    • Further resources:

    • BSA Mortgage Instructions (external website)

    • CML Lenders’ Handbook for England and Wales (external website)

    • Conveyancing Handbook 18th edition (book)

    • CQS Practice Agreement (MS Word)

    • Form TA13 Completion Information and Requisitions on Title (PDF)

    • Law Society Conveyancing Protocol (PDF)

    • Law Society Code for Completion by Post (PDF)

    • Law Society Mortgage Fraud Practice Note

    • Standard Conditions of Sale 5th edition (PDF)


    Next steps

    Next Steps

    This concludes the presentation. Thank you for taking this online course for the CQS.

    Assessment

    The CQS also requires candidates to undertake an assessment following the presentation.

    The assessment comprises 15 multiple choice questions. Candidates must achieve a pass mark of 80%.

    You can begin the assessment by selecting the relevant choice from the CPD Record screen.

    CPD hours

    Completion of this course and assessment qualifies for 2 CPD hours.


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