Commercial Security of Tenure
The Landlord and Tenant Act 1954 introduced a fairer balance between the L&T in business settings. Now, if a business tenant
wants to remain in occupation of its rented premises at the end of its lease term, it can do so as long as it complies with specific
procedures.
Tenants who wish to remain beyond the contractual expiry date (‘CED’) of their lease are ‘holding over’.
Landlords are only able to end the lease if they can prove that one/more of the grounds in the LTA ’54 exist.
Application of the ’54 Act
s.23(1) defines what is meant by a business tenancy:
1. TENANCY – this must fulfil the requirements set out in Street v Mountford (i.e. exclusive possession, for a term absolute
etc). However, it can include periodic tenancies and oral tenancies as well as written one. It excludes licences and
tenancies expressly excluded by s.43 of the 1954 act.
2. OCCUPATION – the tenant must be the occupier of the premises to obtain protection (i.e. a sub-letting of the whole property
will preclude the original T from the protection of the act.
3. BUSINESS – this is widely defined in s.23(2) as “trade, profession or employment”. Incidental residential use is acceptable,
as long as business is the significant purpose of the occupation.
Excluded Tenancies
s.43 of the Act excluded certain tenancies from the protection of the Act:
● Tenancies at will – this type of arrangement is terminable at any time by either party.
● Agricultural holdings – s.43(1)
● Mining leases – s.43(1)
● Service tenancies – s.43(2) – a lease in connection with employment (e.g. a caretaker’s flat)
● Fixed term tenancies not exceeding 6 months – s.43(3) – prima facie these are excluded, but protection can arise if the
same business has been in occupation of the premises for over 12 months or if the tenancy is renewable beyond 6 months
● CONTRACTED OUT TENANCIES – the parties can agree to exclude the lease from the 1954 Act prior to the grant of the
lease. This is typical for short term lettings where L wants to be certain it can regain the property. The procedure must be
in accordance with the Reform Order 2003:
o L must serve a warning notice on the T at least 14 days before the T is contractually bound to take the lease
(considered good practice to also attach a copy of the draft lease to the notice).
▪ Where time is short the 14 day period can be waived and a statutory declaration is made instead of a
simple declaration before an independent solicitor.
o The T must sign a simple declaration saying it accepts the notice
o The lease must contain wording that it is agreed to exclude security of tenure and reference to both the warning
notice and the T’s declaration.
Layers of protection
s.24(1) sets out two layers of protection afforded to business tenants:
1. A business tenancy will continue after the CED in the lease until terminated in one of the ways specified by the Act
2. Business tenants also have a right to apply for a new tenancy on termination of the current tenancy
Termination of a tenancy under the 1954 Act
Section 24 provides that a protected tenancy can only be terminated in one of the ways specified by the Act. Termination is
effected by service of a notice, the principal notices being:
● Landlord’s notice under s.25 – notice to T terminating current tenancy on a date specified in the notice, and informing T
either that L won’t oppose T’s application for new tenancy (friendly notice) or that L will oppose application and on what
grounds (hostile notice). This must be in the statutory prescribed form.
o s.25(2) – must be given not more than 12 months and not less than 6 months before the date of termination.
o s.25(3)(a) – the termination date specified in the notice cannot be earlier than a date on which the tenancy is
brought to an end.
● Tenants request for new tenancy under s.26 – notice to L terminating current tenancy and requesting a new one,
specifying the terms of the lease. This must be in the statutory prescribed form.
● Tenant’s notice terminating tenancy under s.27 – T’s notice simply to terminate the current tenancy without renewing it.
This does not have to be in a prescribed form.
,Completion and post-completion
***Pre-Completion Steps***
Role of the Buyer’s Solicitor
● DRAFT PURCHASE DEED – it must be a deed (s.52 LPA) in order to transfer the legal estate.
o In registered land this is a TR1 form.
● SUBMIT REQUISITIONS ON TITLE – these are queries on the title sent to the seller’s solicitor.
o A series of standard questions which obtain practical information about the completion arrangements (e.g.
keys, which bank account to put money into, any new information, confirmation of mortgage discharge upon
completion).
▪ SCS 4.3.1/SCPC 6.3.1 – the seller’s solicitor must reply in 4 working days.
● PRE-COMPLETION SEARCHES – these essentially ask whether there have been any changes to the title. They have the effect of
freezing the title for 30days.
o REGISTERED LAND:
▪ Do a Form OS1 search at the Land Registry to see if any further entries have been made since the date
the official copies were supplied (the ‘search from date’). NOTE: if the buyer is taking out a mortgage,
the application is in the NAME OF THE LENDER.
● Sending this form gives a 30 day priority period from the date of the search result. This
means the buyer will take priority over any entries placed on the register during the period,
provided the buyer applies to register the purchase within the period.
▪ Do a bankruptcy search: if an individual use Form K16. If the seller is a company, do a companies
house search against it to confirm it exists. The OS1 search will catch out any bankruptcy issues.
o UNREGISTERED LAND: send Form K15 to the Central Land Charges Department to enquire against the seller and
all previous known owners of the land. This gives a protection period of 15 working days in which to
complete.
● DRAFT PURCHASE DEED – form TR1
● FINANCE – CHECK THEY ARE IN PLACE
o Completion Statement – buyer’s solicitor receives from seller’s solicitor showing the amount the seller requires
to complete.
o Financial Statement – send to buyer showing the total sum due (inc. your fees) in order to complete.
Completion
Methods of completion
● Personal attendance
● By post or by telephone – means completion on the phone with original documents to follow by post
Role of Buyer’s solicitor
● Ensure purchase deed executed by the buyer
● Ensure requisitions answered satisfactorily
● Check title documents upon receipt
● Pay completion monies
● Get an undertaking from seller’s solicitor that the mortgage has been redeemed (this is usually via simple confirmation
from the lender or a DS1 form).
Post-Completion
Companies House Applicable where the buyer is a company:
● Register new mortgage within 21 days of the date of the charge
o Form MG01 plus fee
HMRC Applicable for all freehold transactions:
● Pay any SDLT within 30 days of completion
o Submit Land Transaction Return Form (SDLT 1)
● Obtain SDLT 5 certificate of payment
Land Registry Application ● Register the purchase and any new mortgage taken out within the priority period of 30 days (or
2 months if unregistered) after the Form OS1 search (or OS2 search if sale of part)
● Application made on Form AP1 and sent to LR with fee and the below documents.
● Check the official copies updated after the application completed (this will be issued by the LR
as a Title Information Document).
,Also lodge at LR ● SDLT 5
● DS1 for any existing mortgage (or form DS3 if sale of part)
● The purchase deed – Form TR1 (Form TP3 if sale of part)
● A new mortgage (if any)
● Any other documents (e.g. death certificates, deeds of appointment of second trustee)
Mortgagee’s (lender’s) on the Charges Register
● ONE MORTGAGEE – the LR will remove the mortgage on the registration of the purchase without the need for any
documentary evidence.
● MORE THAN ONE MORTGAGEE – it may be necessary to provide evidence to the LR that another mortgage has been repaid. If
there is another mortgage registered before that of the selling mortgagee, the proceeds of sale must be used as laid out
below in accordance with s.105 LPA:
o To pay off the first registered mortgage
o Pay any costs incurred in carrying out the sale
o Pay off the selling mortgagee’s mortgage
o Residue goes to seller
In such cases, the selling mortgagee needs to provide evidence that it has paid off the mortgage which had priority.
Remedies
1) Delayed completion
Completion date
● This occurs where completion doesn't take place on the completion date set out in the contract but does eventually take
place.
● If there is no completion date on the contract SCS 6.1.1 specifies that the matter will be completed 20days after exchange.
● Further, if completion takes place after 2pm on the relevant day, it is deemed to occur on the next working day (SCS
6.1.2/SCPC 8.1.2)
Contractual compensation for delay
● The standard conditions provide for the buyer to make payment to the seller of specific compensation for delay – SCS 7.
● The amount of compensation is based on a penalty interest rate set out in the contract (the contract rate).
o If no amount is specified SCS/SCPC 1.1.1(e) state it will be the law society’s interest rate which is currently
equivalent to 4% per annum above the base rate of Barclays.
o The contract rate is paid on:
▪ If the seller is paying compensation – the whole purchase price
▪ If the buyer is paying compensation – the amount outstanding (less the deposit)
● Compensation is payable each day of delay. When calculating, include the day on which completion was meant to occur
but exclude day finally paid.
Notice to complete
● SCS 6.8/SCPC 8.8 states this may be served on or after the day of completion. However, SCS 6.8.1 states it must be
served after completion (**SCPC 8.8.1 says it can be served any time – so could be on the morning of completion even
if the specified time (e.g. “1 pm”) hasn't passed).
● SCS 6.8.2 – requires the completion to occur within 10 WORKING DAYS.
o SCS 1.3.5 – if notice is received after 4pm, it is deemed as having been received the next working day.
o SCS 1.3.7 governs the deemed times of service.
● FAILURE TO COMPLY with a notice to complete – SCS 7.4 & 7.5: the SELLER can rescind, forfeit the deposit, resell
the property and claim damages, and the BUYER can rescind and demand repayment of deposit + interest.
Rescission?
● Only where time is of the essence. SCS 6.1.1 states it is not of the essence unless specifically provided for in contract.
● Time will only be of the essence:
o After correct service of a notice to complete – SCS 6.8 OR
o By surrounding circumstances (i.e. business would fail)
2) Misrepresentation
This will occur if the seller has misrepresented something to the buyer (Gordon v Selico – concealing physical defects).
● If there’s a material difference between the property & representation then buyer gets damages only. Basically, can the
difference be solved with money?
● If there is fraud or recklessness or the property would substantially differ in quality/quantity of tenure, then rescission.
3) Failure to complete
● The non-defaulting party should serve notice to complete (see above) and then rescind if not complied with.
, Drafting and Exchange of Contracts
Procedure
1. It is the seller’s solicitor who drafts the contract.
2. The buyer’s solicitor then checks the contract and returns to seller’s solicitor with any amendments.
3. Once the contract is agreed the parties will sign.
4. When both parties are read to proceed, the contract will be exchanged, at which point the date for completion of purchase
is fixed and the parties have a legally binding agreement.
Form of the contract
There are standard form contracts for residential and commercial transactions. These both contain ‘Standard Conditions’ and
‘Special Conditions’. Standard contracts are generally for residential transactions. The Special conditions are used to amend
standard conditions and can also be used to incorporate specific conditions.
Drafting the Contract
NB: beware of drafting errors (e.g. misspelt or incorrect parties/incorrectly named property)
Front page (i.e. agreed terms)
● PROPERTY: requires a clear description of the land. State whether it is freehold/leasehold and register/unregistered.
o If a sale of part then include a plan.
● SPECIFIED INCUMBRANCES: allows seller to discharge duty of disclosure. There is no duty to disclose patent incumbrances
(i.e. those obvious on inspection) or physical defects but MUST disclose:
o Latent incumbrances: something which burdens the land and restricts the owner in some way. This includes
easements and existing mortgages. The best way to disclose is to refer to the entries in the Charges Register.
o Defects in title: these are matters bringing into question the seller’s ownership of the property. If it isn't possible
to remedy the defect, the seller should include a special condition revealing the nature of the defect and that the
buyer accepts it (known as a Faruqi clause).
NB: if a residential transaction, any incumbrances revealed by the Land Registry or by normal searches must be
expressly disclosed in the contract or the seller will be liable for breach.
● TITLE GUARANTEE – ss.2-3 LP(MP)A – the guarantee of the seller’s quality of title to the property. DO NOT CONFUSE
with class of title:
o Full title guarantee – expect this – a GUARANTEE that the seller has the right to sell the property and that the
property is free from charges/incumbrances OTHER THAN those disclosed in the contract (s.6(1) LP(MP)A) or
those the seller couldn't have reasonably known about (s.3(1) LP(MP)A).
o Limited title guarantee – there is no guarantee property free from all 3rd party incumbrances. Instead, there is a
guarantee the seller hasn't created any incumbrances since the last sale and is unaware anyone else has. This
should be used if seller has limited knowledge of the property.
NB: unless the contract says otherwise, SCS 4.6.2 states the seller has full title guarantee. Same under SCPC 6.6.2
except there is no pre-printed provision on the front.
● DEPOSIT – SCS 2.2.1 and SCPC 2.2.1 say this is 10% purchase price. SCS 6.8.3 if a lesser deposit has been accepted and
the buyer fails to complete, he must pay the full 10%. It may include chattel payment.
o SCS 2.2 and SCPC 2.2 state the deposit must be paid to the seller’s solicitor as stakeholder. He may also hold
as agent for the seller.
o Under SCS 2.2.5 (not SCPC) if the seller is buying another house he may use the deposit money to fund the
purchase.
● CONTRACT RATE – should be about 3-5% per annum
● PURCHASE PRICE – the agreed amount for the property.
o SDLT rates apply to this:
● CONTENTS PRICE AND CHATTELS
Special Conditions – see back page of handbook
NB: with all special conditions:
1. State who (buyer or seller)
2. Is to do what (e.g. provide document or deal with issue)
3. And by when (e.g. “on or before Completion”)
4. And relevant information on how it will be done
The Landlord and Tenant Act 1954 introduced a fairer balance between the L&T in business settings. Now, if a business tenant
wants to remain in occupation of its rented premises at the end of its lease term, it can do so as long as it complies with specific
procedures.
Tenants who wish to remain beyond the contractual expiry date (‘CED’) of their lease are ‘holding over’.
Landlords are only able to end the lease if they can prove that one/more of the grounds in the LTA ’54 exist.
Application of the ’54 Act
s.23(1) defines what is meant by a business tenancy:
1. TENANCY – this must fulfil the requirements set out in Street v Mountford (i.e. exclusive possession, for a term absolute
etc). However, it can include periodic tenancies and oral tenancies as well as written one. It excludes licences and
tenancies expressly excluded by s.43 of the 1954 act.
2. OCCUPATION – the tenant must be the occupier of the premises to obtain protection (i.e. a sub-letting of the whole property
will preclude the original T from the protection of the act.
3. BUSINESS – this is widely defined in s.23(2) as “trade, profession or employment”. Incidental residential use is acceptable,
as long as business is the significant purpose of the occupation.
Excluded Tenancies
s.43 of the Act excluded certain tenancies from the protection of the Act:
● Tenancies at will – this type of arrangement is terminable at any time by either party.
● Agricultural holdings – s.43(1)
● Mining leases – s.43(1)
● Service tenancies – s.43(2) – a lease in connection with employment (e.g. a caretaker’s flat)
● Fixed term tenancies not exceeding 6 months – s.43(3) – prima facie these are excluded, but protection can arise if the
same business has been in occupation of the premises for over 12 months or if the tenancy is renewable beyond 6 months
● CONTRACTED OUT TENANCIES – the parties can agree to exclude the lease from the 1954 Act prior to the grant of the
lease. This is typical for short term lettings where L wants to be certain it can regain the property. The procedure must be
in accordance with the Reform Order 2003:
o L must serve a warning notice on the T at least 14 days before the T is contractually bound to take the lease
(considered good practice to also attach a copy of the draft lease to the notice).
▪ Where time is short the 14 day period can be waived and a statutory declaration is made instead of a
simple declaration before an independent solicitor.
o The T must sign a simple declaration saying it accepts the notice
o The lease must contain wording that it is agreed to exclude security of tenure and reference to both the warning
notice and the T’s declaration.
Layers of protection
s.24(1) sets out two layers of protection afforded to business tenants:
1. A business tenancy will continue after the CED in the lease until terminated in one of the ways specified by the Act
2. Business tenants also have a right to apply for a new tenancy on termination of the current tenancy
Termination of a tenancy under the 1954 Act
Section 24 provides that a protected tenancy can only be terminated in one of the ways specified by the Act. Termination is
effected by service of a notice, the principal notices being:
● Landlord’s notice under s.25 – notice to T terminating current tenancy on a date specified in the notice, and informing T
either that L won’t oppose T’s application for new tenancy (friendly notice) or that L will oppose application and on what
grounds (hostile notice). This must be in the statutory prescribed form.
o s.25(2) – must be given not more than 12 months and not less than 6 months before the date of termination.
o s.25(3)(a) – the termination date specified in the notice cannot be earlier than a date on which the tenancy is
brought to an end.
● Tenants request for new tenancy under s.26 – notice to L terminating current tenancy and requesting a new one,
specifying the terms of the lease. This must be in the statutory prescribed form.
● Tenant’s notice terminating tenancy under s.27 – T’s notice simply to terminate the current tenancy without renewing it.
This does not have to be in a prescribed form.
,Completion and post-completion
***Pre-Completion Steps***
Role of the Buyer’s Solicitor
● DRAFT PURCHASE DEED – it must be a deed (s.52 LPA) in order to transfer the legal estate.
o In registered land this is a TR1 form.
● SUBMIT REQUISITIONS ON TITLE – these are queries on the title sent to the seller’s solicitor.
o A series of standard questions which obtain practical information about the completion arrangements (e.g.
keys, which bank account to put money into, any new information, confirmation of mortgage discharge upon
completion).
▪ SCS 4.3.1/SCPC 6.3.1 – the seller’s solicitor must reply in 4 working days.
● PRE-COMPLETION SEARCHES – these essentially ask whether there have been any changes to the title. They have the effect of
freezing the title for 30days.
o REGISTERED LAND:
▪ Do a Form OS1 search at the Land Registry to see if any further entries have been made since the date
the official copies were supplied (the ‘search from date’). NOTE: if the buyer is taking out a mortgage,
the application is in the NAME OF THE LENDER.
● Sending this form gives a 30 day priority period from the date of the search result. This
means the buyer will take priority over any entries placed on the register during the period,
provided the buyer applies to register the purchase within the period.
▪ Do a bankruptcy search: if an individual use Form K16. If the seller is a company, do a companies
house search against it to confirm it exists. The OS1 search will catch out any bankruptcy issues.
o UNREGISTERED LAND: send Form K15 to the Central Land Charges Department to enquire against the seller and
all previous known owners of the land. This gives a protection period of 15 working days in which to
complete.
● DRAFT PURCHASE DEED – form TR1
● FINANCE – CHECK THEY ARE IN PLACE
o Completion Statement – buyer’s solicitor receives from seller’s solicitor showing the amount the seller requires
to complete.
o Financial Statement – send to buyer showing the total sum due (inc. your fees) in order to complete.
Completion
Methods of completion
● Personal attendance
● By post or by telephone – means completion on the phone with original documents to follow by post
Role of Buyer’s solicitor
● Ensure purchase deed executed by the buyer
● Ensure requisitions answered satisfactorily
● Check title documents upon receipt
● Pay completion monies
● Get an undertaking from seller’s solicitor that the mortgage has been redeemed (this is usually via simple confirmation
from the lender or a DS1 form).
Post-Completion
Companies House Applicable where the buyer is a company:
● Register new mortgage within 21 days of the date of the charge
o Form MG01 plus fee
HMRC Applicable for all freehold transactions:
● Pay any SDLT within 30 days of completion
o Submit Land Transaction Return Form (SDLT 1)
● Obtain SDLT 5 certificate of payment
Land Registry Application ● Register the purchase and any new mortgage taken out within the priority period of 30 days (or
2 months if unregistered) after the Form OS1 search (or OS2 search if sale of part)
● Application made on Form AP1 and sent to LR with fee and the below documents.
● Check the official copies updated after the application completed (this will be issued by the LR
as a Title Information Document).
,Also lodge at LR ● SDLT 5
● DS1 for any existing mortgage (or form DS3 if sale of part)
● The purchase deed – Form TR1 (Form TP3 if sale of part)
● A new mortgage (if any)
● Any other documents (e.g. death certificates, deeds of appointment of second trustee)
Mortgagee’s (lender’s) on the Charges Register
● ONE MORTGAGEE – the LR will remove the mortgage on the registration of the purchase without the need for any
documentary evidence.
● MORE THAN ONE MORTGAGEE – it may be necessary to provide evidence to the LR that another mortgage has been repaid. If
there is another mortgage registered before that of the selling mortgagee, the proceeds of sale must be used as laid out
below in accordance with s.105 LPA:
o To pay off the first registered mortgage
o Pay any costs incurred in carrying out the sale
o Pay off the selling mortgagee’s mortgage
o Residue goes to seller
In such cases, the selling mortgagee needs to provide evidence that it has paid off the mortgage which had priority.
Remedies
1) Delayed completion
Completion date
● This occurs where completion doesn't take place on the completion date set out in the contract but does eventually take
place.
● If there is no completion date on the contract SCS 6.1.1 specifies that the matter will be completed 20days after exchange.
● Further, if completion takes place after 2pm on the relevant day, it is deemed to occur on the next working day (SCS
6.1.2/SCPC 8.1.2)
Contractual compensation for delay
● The standard conditions provide for the buyer to make payment to the seller of specific compensation for delay – SCS 7.
● The amount of compensation is based on a penalty interest rate set out in the contract (the contract rate).
o If no amount is specified SCS/SCPC 1.1.1(e) state it will be the law society’s interest rate which is currently
equivalent to 4% per annum above the base rate of Barclays.
o The contract rate is paid on:
▪ If the seller is paying compensation – the whole purchase price
▪ If the buyer is paying compensation – the amount outstanding (less the deposit)
● Compensation is payable each day of delay. When calculating, include the day on which completion was meant to occur
but exclude day finally paid.
Notice to complete
● SCS 6.8/SCPC 8.8 states this may be served on or after the day of completion. However, SCS 6.8.1 states it must be
served after completion (**SCPC 8.8.1 says it can be served any time – so could be on the morning of completion even
if the specified time (e.g. “1 pm”) hasn't passed).
● SCS 6.8.2 – requires the completion to occur within 10 WORKING DAYS.
o SCS 1.3.5 – if notice is received after 4pm, it is deemed as having been received the next working day.
o SCS 1.3.7 governs the deemed times of service.
● FAILURE TO COMPLY with a notice to complete – SCS 7.4 & 7.5: the SELLER can rescind, forfeit the deposit, resell
the property and claim damages, and the BUYER can rescind and demand repayment of deposit + interest.
Rescission?
● Only where time is of the essence. SCS 6.1.1 states it is not of the essence unless specifically provided for in contract.
● Time will only be of the essence:
o After correct service of a notice to complete – SCS 6.8 OR
o By surrounding circumstances (i.e. business would fail)
2) Misrepresentation
This will occur if the seller has misrepresented something to the buyer (Gordon v Selico – concealing physical defects).
● If there’s a material difference between the property & representation then buyer gets damages only. Basically, can the
difference be solved with money?
● If there is fraud or recklessness or the property would substantially differ in quality/quantity of tenure, then rescission.
3) Failure to complete
● The non-defaulting party should serve notice to complete (see above) and then rescind if not complied with.
, Drafting and Exchange of Contracts
Procedure
1. It is the seller’s solicitor who drafts the contract.
2. The buyer’s solicitor then checks the contract and returns to seller’s solicitor with any amendments.
3. Once the contract is agreed the parties will sign.
4. When both parties are read to proceed, the contract will be exchanged, at which point the date for completion of purchase
is fixed and the parties have a legally binding agreement.
Form of the contract
There are standard form contracts for residential and commercial transactions. These both contain ‘Standard Conditions’ and
‘Special Conditions’. Standard contracts are generally for residential transactions. The Special conditions are used to amend
standard conditions and can also be used to incorporate specific conditions.
Drafting the Contract
NB: beware of drafting errors (e.g. misspelt or incorrect parties/incorrectly named property)
Front page (i.e. agreed terms)
● PROPERTY: requires a clear description of the land. State whether it is freehold/leasehold and register/unregistered.
o If a sale of part then include a plan.
● SPECIFIED INCUMBRANCES: allows seller to discharge duty of disclosure. There is no duty to disclose patent incumbrances
(i.e. those obvious on inspection) or physical defects but MUST disclose:
o Latent incumbrances: something which burdens the land and restricts the owner in some way. This includes
easements and existing mortgages. The best way to disclose is to refer to the entries in the Charges Register.
o Defects in title: these are matters bringing into question the seller’s ownership of the property. If it isn't possible
to remedy the defect, the seller should include a special condition revealing the nature of the defect and that the
buyer accepts it (known as a Faruqi clause).
NB: if a residential transaction, any incumbrances revealed by the Land Registry or by normal searches must be
expressly disclosed in the contract or the seller will be liable for breach.
● TITLE GUARANTEE – ss.2-3 LP(MP)A – the guarantee of the seller’s quality of title to the property. DO NOT CONFUSE
with class of title:
o Full title guarantee – expect this – a GUARANTEE that the seller has the right to sell the property and that the
property is free from charges/incumbrances OTHER THAN those disclosed in the contract (s.6(1) LP(MP)A) or
those the seller couldn't have reasonably known about (s.3(1) LP(MP)A).
o Limited title guarantee – there is no guarantee property free from all 3rd party incumbrances. Instead, there is a
guarantee the seller hasn't created any incumbrances since the last sale and is unaware anyone else has. This
should be used if seller has limited knowledge of the property.
NB: unless the contract says otherwise, SCS 4.6.2 states the seller has full title guarantee. Same under SCPC 6.6.2
except there is no pre-printed provision on the front.
● DEPOSIT – SCS 2.2.1 and SCPC 2.2.1 say this is 10% purchase price. SCS 6.8.3 if a lesser deposit has been accepted and
the buyer fails to complete, he must pay the full 10%. It may include chattel payment.
o SCS 2.2 and SCPC 2.2 state the deposit must be paid to the seller’s solicitor as stakeholder. He may also hold
as agent for the seller.
o Under SCS 2.2.5 (not SCPC) if the seller is buying another house he may use the deposit money to fund the
purchase.
● CONTRACT RATE – should be about 3-5% per annum
● PURCHASE PRICE – the agreed amount for the property.
o SDLT rates apply to this:
● CONTENTS PRICE AND CHATTELS
Special Conditions – see back page of handbook
NB: with all special conditions:
1. State who (buyer or seller)
2. Is to do what (e.g. provide document or deal with issue)
3. And by when (e.g. “on or before Completion”)
4. And relevant information on how it will be done
