2. Investigating Title, Buyer's Pre-Contract Searches, Town/Country Planning, Buyer's Funding (Stage 2); Exchange of Contracts (Stage 3); and Pre-Completion (Stage 4) Flashcards
What will appear on the property register?
Rights which benefit the land, e.g. a right of way over neighbouring land, will appear as a notice in the property register.
Avoid answer choices which suggest a right benefitting property A is on the property register of the burdened property. They will use this to trick you into assuming it operates the same as a charge. It does not. A benefit can appear on the charges register of the burdened property, but not the property register.
What will appear on the proprietorship register?
Any restrictions affecting title
What must a seller’s solicitor do if they discover there has already been a triggering event in relation to unregistered property they are dealing with, and when?
Make an application to HMLR before drafting the contract
What are the six pre-contract searches which are always carried out?
Local search
Drainage and water search
Environmental search
Index map search
Bankruptcy search (if buyer is borrowing)
Company search (if seller is a company)
What two similarly named searches should not be confused, and what is the difference?
Local land charges register search and land charges register search.
Local land charges register search is a pre-contract search done by buyer to gather practical information.
Land charges register search is a pre-contract search done by buyer to investigate title and any third party rights
Why is an environmental search important?
Because a buyer will be liable for paying for the clean up costs of any land they own which is contaminated, even if it was caused by the seller
What are some location specific searches which might be needed?
Coal mining search
Chancel liability search (ancient obligation to upkeep a church)
What is the commercial equivalent of the property information form?
Commercial Property Standard Inquiries
On the exam, what should a planning issue not be confused with, and which takes priority?
A planning issue should not be confused with a title issue, and planning permission will not cure a title defect
Under the Town and Country Planning Act 1990, planning permission is required for any development. In what two ways is development defined?
Building, engineering, mining or other operations with regard to land, or
Making any material change of use of any buildings or other land
What is a permitted development?
A development which has deemed permission and is exempt from applying for express permission
What are some examples of permitted developments, i.e. developments with deemed permission?
Small home extension, porch, fence, conservatory
What is the effect of a local authority passing an Article 4 Direction?
It revokes the permitted development exception for the relevant area, meaning that all developments must be applied for
What are the two types of express planning permission?
Outline
Detailed
What is outline permission?
Broad permission to the principle of the development, (subject to any reserved matters which if part of the permission must be approved by the authority within three years)
No longer than how long after the grant of outline permission (or the approval of reserved matters where relevant) must development begin?
Two years.
Therefore it could be five years before development needs to begin
Where detailed, i.e. full permission is granted, within what time limit must development begin?
Three years
What is the consequence of planning issues running with the land?
The buyer is liable for any planning issues relating to land they own
Within what time limit of breach must a planning enforcement notice be served where it is regarding (1) unauthorised building works and (2) all other breaches, e.g. breach of conditions of planning?
Unauthorised building works: Four years
Other breaches: Ten years
What is the extent of the listed status where a building is listed?
It covers everything within the curtilage
Within what time limit of breach must a local authority bring an planning enforcement action regarding a listed building?
There is no time limit
Even though a development might not need planning permission, what will all works require?
Compliance with building regulations
Within what time limit of breach must a local authority bring an enforcement action regarding building regulations?
12 months
Even though an building regulations enforcement can only be brought within 12 months, what is always available?
An injunction requiring the owner to comply with the regulations
Where a buyer asks the seller to provide indemnity insurance for a planning or building regulations breach, even though the enforcement period has passed, what must not be done and why?
No contact should be made to local authorities, as this can negate the availability of such insurance as it would technically be after the breach
Regarding planning in a commercial context, what is a use class?
A category of use describing the activities of the building, e.g.:
Commercial, business, and service, e.g. shop, restaurant
Learning and non-residential institution, e.g. museum, library
Local community, e.g. small shops, community hall
Planning permission generally required to change use class, even if no building work is being done.
When planning permission is granted for a use class, is further permission needed to change the activity within the same use class?
Not unless actual building work is required to make that change
Whilst some changes from one use case to another are allowed under permitted development, in what two situations will this not be available and changes to a use class will therefore require an application?
Conservation area
Listed building
Regarding buyer’s funding of the property, whilst a solicitor cannot offer a financial opinion on the mortgage offer, what can they do?
Explain the general terms, e.g. length, interest rate, conditions, but not whether it is a good product or not
What are the two functions achieved by the buyer’s solicitor submitting a clear Certificate of Title to the lender?
Confirms to lender that title is good and marketable
Requests a release of the mortgage funds
What two steps does the process of perfecting the mortgage involve, and who does it?
Buyer’s solicitor will:
Apply to register the title to the property after completion
Ensure the lender’s legal charge is registered as a first legal charge on the Charges Register
What should we look for on the exam which might not appear to trigger a registration requirement for unregistered property but actually does, and why?
A client mortgaging property they already own which has not previously been subject to a mortgage, because a first legal mortgage is a trigger for registration
Regarding registered land, what search begins the priority period to complete registration free from intervening interests, and how long does this period last?
The OS1 or OS2 search will give a 30 day priority period
Where there is a registration requirement which is triggered by mortgage completion concerning unregistered land, within what period must the buyer’s solicitor register the mortgage?
Two months
If the buyer is a company, within what period must the mortgage be registered at Companies House?
21 days
Finished with stage 2 (pre-contract) and on to stage 3 (exchange of contracts):
What are three methods of exchange?
Person
Post
Phone (most common)
When is Formula A used for exchange and what is a quick way to remember this?
When one solicitor holds both signed parts of the contract.
Remembered because one solicitor is Away and the other is doing All the work
When is Formula B used for exchange and what is a quick way to remember this?
When each solicitor hold their own client’s part of the contract.
Remembered because Both solicitors are working.
When is Formula C used for exchange?
When there is a Chain of transactions
How is the interest in a sale contract protected after exchange, where land is (1) registered and (2) unregistered?
Registered: Notice placed on the seller’s charges register
Unregistered: C(iv) estate contract registered against the seller’s full name
Both are removed upon completion.
How is a contract varied after exchange?
Both parties must exchange contracts again with the variation included in the new contract
Finished with stage 3 (exchange of contracts) and on to stage 4 (pre-completion):
In a lease situation, what is the final version of a lease called, and what are its two parts?
An engrossment made up of the original and counterpart
What should the buyer’s pre-completion searches not be confused with?
Pre-contract searches, e.g. local search or drainage search
In the registered system, in the period between completion and registration, only what type of interest does the buyer have, why, and what must be done to protect this interest?
Only an equitable interest, because legal title in the registered system passes upon registration. The equitable title must be registered as a notice on the charges register of the property
What are the two purposes of the official search carried out after exchange in the registered system?
Discover any new entries, e.g. new mortgages, requiring address before competition
Start the 30 day priority period to complete and register
What occurs if there is an error in the official search certificate and what remedy is available?
Buyer is still bound by what should have been on the report, even if unaware of it, however they can claim an indemnity from HMLR
In the unregistered system, what pre-completion searches are carried out?
Repeat the pre-exchange full land charges search against the full names of the landowner/seller for the full period of their ownership
From this search, what is the priority period in the unregistered system in which to complete?
15 days
What are the three types of purchase deed used to transfer freehold property?
Conveyance (unregistered)
Transfer (registered and unregistered)
Assent (used by PRs to transfer to beneficiary)
What are the two types of form used when (1) whole of the land and (2) part of the land in a title is being transferred?
Whole: TR1 Form
Part: TP1 Form
What is a licence to assign?
Document evidencing landlord’s consent to assignment under a lease
