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LPC Law Notes Property Law and Practice Notes

Pre Contract Searches Notes

Updated Pre Contract Searches Notes

Property Law and Practice Notes

Property Law and Practice

Approximately 490 pages

A collection of the best LPC PLP notes the director of Oxbridge Notes (an Oxford law graduate) could find after combing through dozens of LPC samples from outstanding students with the highest results in England and carefully evaluating each on accuracy, formatting, logical structure, spelling/grammar, conciseness and "wow-factor".

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Why do the searches?

  • Because, when the buyer purchasing property the principle of caveat emptor applies (Let the buyer beware — emphasising that it is the buyer’s responsibility to discover problems with the property, not the seller’s to disclose them). Thus, the Solicitor carries out the investigation (Due Diligence) so that the client has as much info as possible and can enter the transaction eyes wide open.

  • Seller’s duty to disclose is limited, so further searches are necessary to protect the buyer (even when a Pre-Contract Package has been provided by the seller)

  • If solicitor doesn’t make them, they could be liable for professional negligence

When do the searches?

  • To satisfy the buyer’s lender, all should be made not more than 6 months before completion

  • In practice, it will usually be 2 months before completion

What searches to make?

Always (explain why the search is required) p167 Unregistered Fact Dependent (explain why required)

  • Personal inspection

  • Pre-Contract Enquiries of the seller (TA6 PIF or CPSE)

  • Water and Drainage enquiries under CON29DW

  • LLC1 (local land charges)

  • Local Authority enquiries:

    • CON29R (Enquiries of Local Authority)

    • CON29O (Optional Enquiries)

  • Environmental Search as a matter of best practice “Desktop”

  • Chancel Liability/Repair Search

(LLC1 + CON29R + CON29O are usually submitted together)

  • Index Map Search

  • Form K15 “Land Charges Department Search” p175

  • Mining Search (CON29M)

  • Company Search (only if seller is a Co.)

  • K16 Land Charges Department Search for insolvency

  • Flooding

  • Highways Search

  • Canals/Rivers Search

  • Railways

  • Commons Registration Search

  • Structural Survey of Property (flooding/mining)

What to do with the Results?

  • You must pursue unsatisfactory results or face liability (Computastaff) and check with the client’s instructions

  • You must pass on the results to you client

  • A buyer has imputed knowledge of everything that his solicitor knows (Strover v Harrington (1998))

  • Common scenarios:

Property built within last 10 years

  • Copy of NHBC document to give to insurance re structural defects

  • Copies of planning permission and have they been complied with?

  • Check that roads and drains are adopted

  • Check that adequate easements exists
Access to Property

  • Check the title to ensure that easements exists (express; implied; presumed)

  • Arrangements for maintenance and repair
Occupiers

  • Find out by pre-contract enquiries

  • Do the occupiers claim equitable interest or a tenancy? FLA? Licence

  • Have the FLA rights been registered?

  • Ensure any occupiers will surrender on completion

New Estate Roads & Drains

  • These are unadopted private roads

  • Likely to be adopted by the Highways Authority (but may not be)

  • Ensure a contract clause that the developer will make and maintain roads up to the LA standards until such point as they may be adopted, at no cost to the buyer

  • If developer goes insolvent, buyer could become liable for costs of adoption, so ensure there is a s.38 agreement supported by a sufficient financial bond between HA and the developer

  • For drains, it is a s.104 agreement

Search Purpose Procedure Info Obtained Liability

Pre-contract enquiries of the Seller

(Residential Property)

p171

 To elicit information from seller he’s not required by law to disclose, mainly about defects and neighbour disputes. Seller can refuse, but this would put off the buyer

TA6 PIF (freehold);

TA7 PIF (leasehold) and pre-contract package submitted to seller. Delete any irrelevant questions and can add unique questions.

  • Who is in occupation (rights)

  • Alterations/work done and any PP or BR consent obtained

  • Any change in use

  • Neighbour disputes

  • Any easements

  • Any non-owning occupiers

p171 & 172

*Misleading reply could lead to misrepresentation.

* Exclusion clauses are subject to reasonable test in UCTA 1977. Solicitor is liable to client (CEMP Properties UK Ltd v Dentsply RDC N1), not the buyer (Doe v Skegg).

*It is common for the seller’s solicitor to answer enquiries vaguely with the intent of avoiding any possible liability for misrepresentation (e.g. ‘Not so far as we are aware’ or ‘Not so far as the seller is aware’).

Pre-contract enquiries of the Seller (Commercial

Property)

p172

 “ ” (CPSE) Commercial Property Standard Enquiries.

CPSE Form 1 (always)

  • Boundaries

  • Adverse rights

  • Access to the property

  • Fire safety

  • Compliance with Planning & Building Reg.

  • The VAT status of the transaction

Forms available in addition to CPSE Form 1

  • CPSE 2 sale of pro subject to tenancies

  • CPSE 3 sale on the grant of new lease

  • CPSE 4 the assignment of a lease

LLC1

Local Land Charges Search

p167

* To access information kept on the Local Authority’s Local Charges Register

* Reveals matters which fall within the statutory definition of local land charge (e.g. PP granted)

Submit Form LLC1 of all 12 parts, fee and plan to the borough in which property is registered

You will receive a back a certificate with entries

  • Financial charges

  • TPOs (Tree Preservation Order)

  • Smoke control order (restricts use of non-smokeless fuels in domestic fireplaces)

  • CPOs (Compulsory Purchase Order)

  • History of Planning Permission

  • Orders revoking or modifying those PP

  • Restrictions on permitted development

If buyer suffers loss because of an error in the certificate, may receive compensation under s.10 LCA 1975.

You must advise buyer on the meaning of the information obtained

CON29R

(Local Authority Enquiries)

p168

Get a more complete picture of property and its surroundings

*reveals a wider range of information and are not restricted to land charges (e.g. planning applications made including refusals)

 Tick relevant questions to be answered and submit 2 copies and fee by post to district where the property is registered

1: Granted, pending or refused Planning Permission (PP) or Building Regulation (BR)

2: Whether serving roads are maintained at the public expense (if not, then buyer is liable for maintenance and upgrading them)

3.4 & 3.5...

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