Table of Contents
THE KEY ELEMENTS OF A FREEHOLD/LEASEHOLD RESIDENTIAL OR COMMERCIAL PROPERTY TRANSACTION.............................2
INVESTIGATION OF A REGISTERED OR UNREGISTERED FREEHOLD/LEASEHOLD TITLE.................................................................6
KEY ELEMENTS AND STRUCTURE OF FREEHOLD PROPERTY TRANSACTIONS......................................................................................................6
PROCESS OF ANALYSING LAND REGISTRY OFFICIAL COPY ENTRIES.................................................................................................................6
PROCESS OF ANALYSING AN EPITOME OF TITLE AND DEDUCING OWNERSHIP...................................................................................................8
ISSUES THAT COULD ARISE FROM AN INVESTIGATION OF TITLE AND FURTHER ACTION REQUIRED.......................................................................11
PURPOSE AND PROCESS OF REPORTING TO THE CLIENT............................................................................................................................11
PRE-CONTRACT SEARCHES AND ENQUIRIES UNDERTAKEN WHEN ACQUIRING A FREEHOLD/LEASEHOLD PROPERTY................11
RANGE AND PURPOSE OF MAKING SEARCHES AND RAISING ENQUIRIES........................................................................................................11
WHO WOULD MAKE THE SEARCHES AND RAISE ENQUIRIES........................................................................................................................12
RESULTS OF SEARCHES AND ENQUIRIES.................................................................................................................................................14
CORE PRINCIPLES OF PLANNING LAW:.................................................................................................................................... 15
STATUTORY DEFINITION OF 'DEVELOPMENT'...........................................................................................................................................15
MATTERS THAT DO NOT CONSTITUTE 'DEVELOPMENT'.............................................................................................................................15
MATTERS THAT DO NOT REQUIRE EXPRESS PLANNING PERMISSION.............................................................................................................15
BUILDING REGULATION CONTROL........................................................................................................................................................ 16
ENFORCEMENT: TIME LIMITS AND THE RANGE OF LOCAL PLANNING AUTHORITY'S ENFORCEMENT POWERS.........................................................16
STEPS IN PROGRESSING A FREEHOLD/LEASEHOLD PROPERTY TRANSACTION TO EXCHANGE OF CONTRACTS...........................18
LAW SOCIETY CONVEYANCING PROTOCOL.............................................................................................................................................18
SOURCES OF FINANCE FOR A PROPERTY TRANSACTION.............................................................................................................................18
TYPES OF MORTGAGE........................................................................................................................................................................19
ACTING FOR A LENDER: LENDER'S REQUIREMENTS AND PURPOSE OF A CERTIFICATE OF TITLE...........................................................................19
KEY CONDITIONS CONTAINED WITHIN THE STANDARD CONDITIONS OF SALE AND THE STANDARD COMMERCIAL PROPERTY CONDITIONS.................20
PURPOSE OF, AND MATTERS COVERED BY, SPECIAL CONDITIONS................................................................................................................21
METHODS OF HOLDING A DEPOSIT (STAKEHOLDER, AGENT)......................................................................................................................22
INSURANCE AND RISK........................................................................................................................................................................22
BASICS OF VAT IN A CONTRACT.......................................................................................................................................................... 22
TIMING FOR ISSUING CERTIFICATE OF TITLE TO A LENDER..........................................................................................................................22
THE PRACTICE, METHOD AND AUTHORITY TO EXCHANGE..........................................................................................................................22
THE CONSEQUENCES OF EXCHANGE..................................................................................................................................................... 24
PRE-COMPLETION STEPS RELEVANT TO A FREEHOLD AND/OR LEASEHOLD PROPERTY TRANSACTION.....................................24
FORM OF TRANSFER DEED AND FORMALITIES FOR EXECUTION...................................................................................................................24
PRE-COMPLETION SEARCHES.............................................................................................................................................................. 26
PRE-COMPLETION STEPS....................................................................................................................................................................27
COMPLETION AND POST-COMPLETION STEPS RELEVANT TO A FREEHOLD AND/OR LEASEHOLD PROPERTY TRANSACTION
INCLUDING REMEDIES FOR DELAYED COMPENSATION............................................................................................................ 27
METHODS AND EFFECT OF COMPLETION...............................................................................................................................................27
POST-COMPLETION STEPS.................................................................................................................................................................. 27
REMEDIES FOR DELAYED COMPLETION:.................................................................................................................................................28
Contractual compensation:.......................................................................................................................................................28
Common law damages:.............................................................................................................................................................28
Recission:...................................................................................................................................................................................29
Notice to complete:...................................................................................................................................................................29
THE GRANT AND THE ASSIGNMENT OF A COMMERCIAL LEASE AND/OR UNDERLEASE............................................................29
STRUCTURE AND CONTENT OF A LEASE:................................................................................................................................................32
Repair........................................................................................................................................................................................32
Insurance...................................................................................................................................................................................32
Alterations.................................................................................................................................................................................33
User and planning.....................................................................................................................................................................34
Rent and rent review.................................................................................................................................................................34
Alienation..................................................................................................................................................................................34
Options for the term of a lease.................................................................................................................................................35
Code for Leasing Business Premises..........................................................................................................................................35
, PROCEDURAL STEPS FOR THE GRANT OF A LEASE OR UNDERLEASE:.............................................................................................................35
Drafting the lease......................................................................................................................................................................36
Purpose of an agreement for lease...........................................................................................................................................36
Deduction of title.......................................................................................................................................................................36
Pre-contract enquiries and searches.........................................................................................................................................36
Pre-completion formalities........................................................................................................................................................36
Completion and post-completion steps.....................................................................................................................................37
LICENCE TO ASSIGN AND LICENCE TO UNDERLET:....................................................................................................................................43
Purpose of and who prepares the draft....................................................................................................................................43
Privity of contract and how the licence deals with this.............................................................................................................43
Key provisions in the licence......................................................................................................................................................43
THE KEY LEASE COVENANTS IN A COMMERCIAL LEASE AND THE LAW RELATING TO THEIR BREACH.........................................43
LEASEHOLD COVENANTS:................................................................................................................................................................... 43
Liability on covenants in leases granted before and after 1 January 1996...............................................................................43
REMEDIES FOR BREACH OF A LEASEHOLD COVENANT:..............................................................................................................................44
Action in debt............................................................................................................................................................................44
Forfeiture...................................................................................................................................................................................44
Commercial Rent Arrears Recovery...........................................................................................................................................45
Pursue guarantors and/or rent deposit.....................................................................................................................................45
Specific performance.................................................................................................................................................................45
Damages....................................................................................................................................................................................45
Self-help/Jervis v Harris clause..................................................................................................................................................46
Remedies for non-payment of rent:..........................................................................................................................................46
Remedies for repairing breaches:..............................................................................................................................................46
Remedies for all other breaches:...............................................................................................................................................47
Remedies involving security arrangements:..............................................................................................................................47
TERMINATION OF A LEASE:.................................................................................................................................................................47
Effluxion of time.........................................................................................................................................................................48
Break clause:.............................................................................................................................................................................48
Notice to quit.............................................................................................................................................................................48
Surrender...................................................................................................................................................................................48
Merger.......................................................................................................................................................................................48
SECURITY OF TENURE UNDER THE LANDLORD AND TENANT ACT 1954 PART II........................................................................49
Application of 1954 Act.............................................................................................................................................................49
Renewal/ending lease by the tenant.........................................................................................................................................49
Termination by the landlord......................................................................................................................................................50
Landlord's grounds of opposition..............................................................................................................................................50
Terms of new lease....................................................................................................................................................................51
Availability of compensation.....................................................................................................................................................52
TAXATION OF PROPERTY TRANSACTIONS THROUGH STAMP DUTY LAND TAX, LAND TRANSACTION TAX, VALUE ADDED TAX
AND CAPITAL GAINS TAX........................................................................................................................................................ 53
STAMP DUTY LAND TAX AND LAND TRANSACTION TAX:..........................................................................................................................53
Basis of charge in both England and Wales for residential property........................................................................................53
Basis of charge in both England and Wales for non-residential freehold property..................................................................53
VALUE ADDED TAX:......................................................................................................................................................................... 53
Basis of charge: what constitutes a taxable supply..................................................................................................................53
Basis of charge: differences between standard, exempt and zero-rated supplies....................................................................53
Reasons why a client would make an option to tax and the effect that has.............................................................................53
CAPITAL GAINS TAX:.........................................................................................................................................................................53
Basis of charge..........................................................................................................................................................................53
Principal private dwelling-house exemption.............................................................................................................................53
PROFESSIONAL CONDUCT ISSUES IN PROPERTY TRANSACTIONS:............................................................................................ 54
The key elements of a freehold/leasehold residential or commercial property transaction
Conveyancing:
The process of transfer of title (ownership) to property between the seller (transferor) and the buyer
(transferee).
,Stages in a typical property transaction:
Pre-exchange – free to withdraw from transaction, no legal right to recover costs from other party
Pre-completion
Post completion
Exchange of contracts:
When deposit (usually 10% paid) and parties become bound to complete transaction on agreed completion
date
Buyer gains an equitable interest in the property under a constructive trust
Completion:
Balance purchase price paid, keys handed over & transfer deed completed
Buyer becomes entitled to become registered as proprietor
Legal ownership:
o Registered title -> the legal transfer does not technically take place until it is registered at HM Land
Registry
o Unregistered title -> the legal transfer does take place on completion but will become void if the title
is not registered within two months of completion.
Pre- Seller’s solicitor: Buyer solicitor:
exchange: Carries out an investigation of title Carries out an investigation of title as per
and then undertakes a deduction ‘caveat emptor’
of title for the buyer’s solicitor Check, approve, and may amend the draft
Provide a draft contract and contract, and carry out and review the
supporting documentation, as well results of standard pre-contract searches
as replies to standard pre-contract and enquiries of both the seller and third
enquiries, and they respond to any parties e.g. local authority and local water
additional pre-contract enquiries authority
and requisitions on title raised by Raise any additional enquiries and
the buyer’s solicitor requisitions on title.
Deal with any proposals to amend Buyer’s solicitor reports to their client (and
the draft contract, produce clean possibly their mortgagee) and obtains the
copies for signature, and request a deposit in readiness for exchange of
redemption statement from any contracts. The buyer is usually advised to
mortgagee(s). insure the property from exchange of
contracts.
Pre- Seller solicitor: Buyer solicitor:
completion: Approves draft transfer deed and Prepares the draft transfer deed for approval
requests clean copy incorporating by seller’s solicitor and the mortgage deed
any proposed amendments for execution by the buyer
Respond to buyer’s completion Buyer solicitor carries out pre-completion
information and undertakings form searches and enquiries of the seller solicitor
(which includes an undertaking to and 3rd parties and submit their certificate of
discharge any pre-existing title/report on title to the lender and
mortgage(s) request the mortgage advance
Arranges for clean copy transfer Request from client the balance due to
deed to be executed by the seller complete and deal with any amendments to
the transfer deed requested by seller’s
solicitor, producing clean copy for execution
Post- Seller solicitor: Buyer solicitor:
completion: Discharges any existing mortgage(s) Deals with submission of the Stamp Duty
and provides the buyer’s solicitor Land Tax (England) or Land Transaction Tax
with proof of discharge (Wales)
Pay any estate agent’s costs (if Deals with registration at HM Land Reg and
authorised to do so by seller) and sometimes Companies House
account to their client
, Investigation of title:
Title to property checked/examined to ensure the following:
o Seller is entitle to sell
o Title is good and marketable with all necessary rights and no materially adverse incumbrancers
burdening property e.g. easements/covenants
Deduction of title:
Seller solicitor provides to buyer’s solicitor proof/evidence of seller’s title/ownership
o Unregistered land -> copy title deeds
o Registered land -> official copies of the registers of title, land registry title plan, copies of any docs
referred to but not already extracted in the official copies of the register (have to be official copies –
no photocopies allowed) (official copies applied for using HM Land Reg form OC1 with form OC2
used for official copies of docs referred to in title) – app can be submitted online through portal
Requisitions on title:
Additional enquiries of seller solicitor as part of investigation of title and the results of pre-contract searches
and enquires
Specific questions about an issue that require a solution
Buyer generally not entitled to raise further requisitions on title after contracts have been exchanged
Caveat emptor:
Means ‘let the buyer beware’ – onus is on buyer to investigate title fully and find out as much as possible
about it to ensure they are aware of any problems + issues, cannot withdraw if find a problem with property
post exchange
Seller generally under no obligation to give buyer all relevant info that they may require – buyer solicitor’s
job to investigate, but some exceptions to this:
o Misrepresentation – false statement that induces buyer to contract to buy – seller cannot mislead
buyer by concealing physical defects. Remedy in common law.
o Latent encumbrances (something not apparent on inspection – seller obliged to disclose those which
aware of or has means to know) and title defects (matters that bring into question seller’s ownership
of property or rights and burdens affecting property)
Buyer can require seller to remedy problems before completion – including these as a condition in a sale
contract
Taking instructions: Important to take detailed instructions and anticipate any potential issues at the beginning of
the transaction
Make sure to advice on likely timescale and costs (average residential sale 6-8 weeks from sale agreement to
completion)
Recording co-ownership arrangements:
o Important to get clear instructions from client on co-ownership and carry them out
o Declaration of trust of land must be in writing and signed by the declarant (TR1 includes panel for
this)
In all transactions: When acting for Buyer:
Full details of buyer and seller Details of any proposed mortgage and if required, generic
advice on options
Estate agent’s details Position concerning the age of the property, property
survey and advice on types of survey
Details of solicitors acting for the other side Details concerning proposed use and proposed
alterations and additions
Property address and tenure (freehold or leasehold) Situation of property e.g. is it close to a river – will be
useful when deciding searches
Agreed purchase price and deposit Advise on co-ownership and holding of equitable interest
THE KEY ELEMENTS OF A FREEHOLD/LEASEHOLD RESIDENTIAL OR COMMERCIAL PROPERTY TRANSACTION.............................2
INVESTIGATION OF A REGISTERED OR UNREGISTERED FREEHOLD/LEASEHOLD TITLE.................................................................6
KEY ELEMENTS AND STRUCTURE OF FREEHOLD PROPERTY TRANSACTIONS......................................................................................................6
PROCESS OF ANALYSING LAND REGISTRY OFFICIAL COPY ENTRIES.................................................................................................................6
PROCESS OF ANALYSING AN EPITOME OF TITLE AND DEDUCING OWNERSHIP...................................................................................................8
ISSUES THAT COULD ARISE FROM AN INVESTIGATION OF TITLE AND FURTHER ACTION REQUIRED.......................................................................11
PURPOSE AND PROCESS OF REPORTING TO THE CLIENT............................................................................................................................11
PRE-CONTRACT SEARCHES AND ENQUIRIES UNDERTAKEN WHEN ACQUIRING A FREEHOLD/LEASEHOLD PROPERTY................11
RANGE AND PURPOSE OF MAKING SEARCHES AND RAISING ENQUIRIES........................................................................................................11
WHO WOULD MAKE THE SEARCHES AND RAISE ENQUIRIES........................................................................................................................12
RESULTS OF SEARCHES AND ENQUIRIES.................................................................................................................................................14
CORE PRINCIPLES OF PLANNING LAW:.................................................................................................................................... 15
STATUTORY DEFINITION OF 'DEVELOPMENT'...........................................................................................................................................15
MATTERS THAT DO NOT CONSTITUTE 'DEVELOPMENT'.............................................................................................................................15
MATTERS THAT DO NOT REQUIRE EXPRESS PLANNING PERMISSION.............................................................................................................15
BUILDING REGULATION CONTROL........................................................................................................................................................ 16
ENFORCEMENT: TIME LIMITS AND THE RANGE OF LOCAL PLANNING AUTHORITY'S ENFORCEMENT POWERS.........................................................16
STEPS IN PROGRESSING A FREEHOLD/LEASEHOLD PROPERTY TRANSACTION TO EXCHANGE OF CONTRACTS...........................18
LAW SOCIETY CONVEYANCING PROTOCOL.............................................................................................................................................18
SOURCES OF FINANCE FOR A PROPERTY TRANSACTION.............................................................................................................................18
TYPES OF MORTGAGE........................................................................................................................................................................19
ACTING FOR A LENDER: LENDER'S REQUIREMENTS AND PURPOSE OF A CERTIFICATE OF TITLE...........................................................................19
KEY CONDITIONS CONTAINED WITHIN THE STANDARD CONDITIONS OF SALE AND THE STANDARD COMMERCIAL PROPERTY CONDITIONS.................20
PURPOSE OF, AND MATTERS COVERED BY, SPECIAL CONDITIONS................................................................................................................21
METHODS OF HOLDING A DEPOSIT (STAKEHOLDER, AGENT)......................................................................................................................22
INSURANCE AND RISK........................................................................................................................................................................22
BASICS OF VAT IN A CONTRACT.......................................................................................................................................................... 22
TIMING FOR ISSUING CERTIFICATE OF TITLE TO A LENDER..........................................................................................................................22
THE PRACTICE, METHOD AND AUTHORITY TO EXCHANGE..........................................................................................................................22
THE CONSEQUENCES OF EXCHANGE..................................................................................................................................................... 24
PRE-COMPLETION STEPS RELEVANT TO A FREEHOLD AND/OR LEASEHOLD PROPERTY TRANSACTION.....................................24
FORM OF TRANSFER DEED AND FORMALITIES FOR EXECUTION...................................................................................................................24
PRE-COMPLETION SEARCHES.............................................................................................................................................................. 26
PRE-COMPLETION STEPS....................................................................................................................................................................27
COMPLETION AND POST-COMPLETION STEPS RELEVANT TO A FREEHOLD AND/OR LEASEHOLD PROPERTY TRANSACTION
INCLUDING REMEDIES FOR DELAYED COMPENSATION............................................................................................................ 27
METHODS AND EFFECT OF COMPLETION...............................................................................................................................................27
POST-COMPLETION STEPS.................................................................................................................................................................. 27
REMEDIES FOR DELAYED COMPLETION:.................................................................................................................................................28
Contractual compensation:.......................................................................................................................................................28
Common law damages:.............................................................................................................................................................28
Recission:...................................................................................................................................................................................29
Notice to complete:...................................................................................................................................................................29
THE GRANT AND THE ASSIGNMENT OF A COMMERCIAL LEASE AND/OR UNDERLEASE............................................................29
STRUCTURE AND CONTENT OF A LEASE:................................................................................................................................................32
Repair........................................................................................................................................................................................32
Insurance...................................................................................................................................................................................32
Alterations.................................................................................................................................................................................33
User and planning.....................................................................................................................................................................34
Rent and rent review.................................................................................................................................................................34
Alienation..................................................................................................................................................................................34
Options for the term of a lease.................................................................................................................................................35
Code for Leasing Business Premises..........................................................................................................................................35
, PROCEDURAL STEPS FOR THE GRANT OF A LEASE OR UNDERLEASE:.............................................................................................................35
Drafting the lease......................................................................................................................................................................36
Purpose of an agreement for lease...........................................................................................................................................36
Deduction of title.......................................................................................................................................................................36
Pre-contract enquiries and searches.........................................................................................................................................36
Pre-completion formalities........................................................................................................................................................36
Completion and post-completion steps.....................................................................................................................................37
LICENCE TO ASSIGN AND LICENCE TO UNDERLET:....................................................................................................................................43
Purpose of and who prepares the draft....................................................................................................................................43
Privity of contract and how the licence deals with this.............................................................................................................43
Key provisions in the licence......................................................................................................................................................43
THE KEY LEASE COVENANTS IN A COMMERCIAL LEASE AND THE LAW RELATING TO THEIR BREACH.........................................43
LEASEHOLD COVENANTS:................................................................................................................................................................... 43
Liability on covenants in leases granted before and after 1 January 1996...............................................................................43
REMEDIES FOR BREACH OF A LEASEHOLD COVENANT:..............................................................................................................................44
Action in debt............................................................................................................................................................................44
Forfeiture...................................................................................................................................................................................44
Commercial Rent Arrears Recovery...........................................................................................................................................45
Pursue guarantors and/or rent deposit.....................................................................................................................................45
Specific performance.................................................................................................................................................................45
Damages....................................................................................................................................................................................45
Self-help/Jervis v Harris clause..................................................................................................................................................46
Remedies for non-payment of rent:..........................................................................................................................................46
Remedies for repairing breaches:..............................................................................................................................................46
Remedies for all other breaches:...............................................................................................................................................47
Remedies involving security arrangements:..............................................................................................................................47
TERMINATION OF A LEASE:.................................................................................................................................................................47
Effluxion of time.........................................................................................................................................................................48
Break clause:.............................................................................................................................................................................48
Notice to quit.............................................................................................................................................................................48
Surrender...................................................................................................................................................................................48
Merger.......................................................................................................................................................................................48
SECURITY OF TENURE UNDER THE LANDLORD AND TENANT ACT 1954 PART II........................................................................49
Application of 1954 Act.............................................................................................................................................................49
Renewal/ending lease by the tenant.........................................................................................................................................49
Termination by the landlord......................................................................................................................................................50
Landlord's grounds of opposition..............................................................................................................................................50
Terms of new lease....................................................................................................................................................................51
Availability of compensation.....................................................................................................................................................52
TAXATION OF PROPERTY TRANSACTIONS THROUGH STAMP DUTY LAND TAX, LAND TRANSACTION TAX, VALUE ADDED TAX
AND CAPITAL GAINS TAX........................................................................................................................................................ 53
STAMP DUTY LAND TAX AND LAND TRANSACTION TAX:..........................................................................................................................53
Basis of charge in both England and Wales for residential property........................................................................................53
Basis of charge in both England and Wales for non-residential freehold property..................................................................53
VALUE ADDED TAX:......................................................................................................................................................................... 53
Basis of charge: what constitutes a taxable supply..................................................................................................................53
Basis of charge: differences between standard, exempt and zero-rated supplies....................................................................53
Reasons why a client would make an option to tax and the effect that has.............................................................................53
CAPITAL GAINS TAX:.........................................................................................................................................................................53
Basis of charge..........................................................................................................................................................................53
Principal private dwelling-house exemption.............................................................................................................................53
PROFESSIONAL CONDUCT ISSUES IN PROPERTY TRANSACTIONS:............................................................................................ 54
The key elements of a freehold/leasehold residential or commercial property transaction
Conveyancing:
The process of transfer of title (ownership) to property between the seller (transferor) and the buyer
(transferee).
,Stages in a typical property transaction:
Pre-exchange – free to withdraw from transaction, no legal right to recover costs from other party
Pre-completion
Post completion
Exchange of contracts:
When deposit (usually 10% paid) and parties become bound to complete transaction on agreed completion
date
Buyer gains an equitable interest in the property under a constructive trust
Completion:
Balance purchase price paid, keys handed over & transfer deed completed
Buyer becomes entitled to become registered as proprietor
Legal ownership:
o Registered title -> the legal transfer does not technically take place until it is registered at HM Land
Registry
o Unregistered title -> the legal transfer does take place on completion but will become void if the title
is not registered within two months of completion.
Pre- Seller’s solicitor: Buyer solicitor:
exchange: Carries out an investigation of title Carries out an investigation of title as per
and then undertakes a deduction ‘caveat emptor’
of title for the buyer’s solicitor Check, approve, and may amend the draft
Provide a draft contract and contract, and carry out and review the
supporting documentation, as well results of standard pre-contract searches
as replies to standard pre-contract and enquiries of both the seller and third
enquiries, and they respond to any parties e.g. local authority and local water
additional pre-contract enquiries authority
and requisitions on title raised by Raise any additional enquiries and
the buyer’s solicitor requisitions on title.
Deal with any proposals to amend Buyer’s solicitor reports to their client (and
the draft contract, produce clean possibly their mortgagee) and obtains the
copies for signature, and request a deposit in readiness for exchange of
redemption statement from any contracts. The buyer is usually advised to
mortgagee(s). insure the property from exchange of
contracts.
Pre- Seller solicitor: Buyer solicitor:
completion: Approves draft transfer deed and Prepares the draft transfer deed for approval
requests clean copy incorporating by seller’s solicitor and the mortgage deed
any proposed amendments for execution by the buyer
Respond to buyer’s completion Buyer solicitor carries out pre-completion
information and undertakings form searches and enquiries of the seller solicitor
(which includes an undertaking to and 3rd parties and submit their certificate of
discharge any pre-existing title/report on title to the lender and
mortgage(s) request the mortgage advance
Arranges for clean copy transfer Request from client the balance due to
deed to be executed by the seller complete and deal with any amendments to
the transfer deed requested by seller’s
solicitor, producing clean copy for execution
Post- Seller solicitor: Buyer solicitor:
completion: Discharges any existing mortgage(s) Deals with submission of the Stamp Duty
and provides the buyer’s solicitor Land Tax (England) or Land Transaction Tax
with proof of discharge (Wales)
Pay any estate agent’s costs (if Deals with registration at HM Land Reg and
authorised to do so by seller) and sometimes Companies House
account to their client
, Investigation of title:
Title to property checked/examined to ensure the following:
o Seller is entitle to sell
o Title is good and marketable with all necessary rights and no materially adverse incumbrancers
burdening property e.g. easements/covenants
Deduction of title:
Seller solicitor provides to buyer’s solicitor proof/evidence of seller’s title/ownership
o Unregistered land -> copy title deeds
o Registered land -> official copies of the registers of title, land registry title plan, copies of any docs
referred to but not already extracted in the official copies of the register (have to be official copies –
no photocopies allowed) (official copies applied for using HM Land Reg form OC1 with form OC2
used for official copies of docs referred to in title) – app can be submitted online through portal
Requisitions on title:
Additional enquiries of seller solicitor as part of investigation of title and the results of pre-contract searches
and enquires
Specific questions about an issue that require a solution
Buyer generally not entitled to raise further requisitions on title after contracts have been exchanged
Caveat emptor:
Means ‘let the buyer beware’ – onus is on buyer to investigate title fully and find out as much as possible
about it to ensure they are aware of any problems + issues, cannot withdraw if find a problem with property
post exchange
Seller generally under no obligation to give buyer all relevant info that they may require – buyer solicitor’s
job to investigate, but some exceptions to this:
o Misrepresentation – false statement that induces buyer to contract to buy – seller cannot mislead
buyer by concealing physical defects. Remedy in common law.
o Latent encumbrances (something not apparent on inspection – seller obliged to disclose those which
aware of or has means to know) and title defects (matters that bring into question seller’s ownership
of property or rights and burdens affecting property)
Buyer can require seller to remedy problems before completion – including these as a condition in a sale
contract
Taking instructions: Important to take detailed instructions and anticipate any potential issues at the beginning of
the transaction
Make sure to advice on likely timescale and costs (average residential sale 6-8 weeks from sale agreement to
completion)
Recording co-ownership arrangements:
o Important to get clear instructions from client on co-ownership and carry them out
o Declaration of trust of land must be in writing and signed by the declarant (TR1 includes panel for
this)
In all transactions: When acting for Buyer:
Full details of buyer and seller Details of any proposed mortgage and if required, generic
advice on options
Estate agent’s details Position concerning the age of the property, property
survey and advice on types of survey
Details of solicitors acting for the other side Details concerning proposed use and proposed
alterations and additions
Property address and tenure (freehold or leasehold) Situation of property e.g. is it close to a river – will be
useful when deciding searches
Agreed purchase price and deposit Advise on co-ownership and holding of equitable interest
