5. Completion and Remedies Flashcards
O in COMP acronym
OS1 + other searches
Why is there no need to attach plan in TR1
Already in OC
What must happen by end of CLC protection period
Completion
What does S’s S do to prepare for completion
Replies to TA13, prepares completion statement, agrees to TR1 and arranges execution of PD
M in COMP acronym
Money
Who is MR01 sent to
CH
What happens to C once transaction completed
Merges w/ PD
When is a completion statement unnecessary
If only purchase price payable
Three main searches pre-completion for reg land
OS1, solvency search on Buyer, and on Seller
SDLT1 sent to
HMRC
SCPC on damages for delayed completion
10.3
How does a company execute deed
Executed as a deed by [C] Acting by [2Ds or 1D + CS] and then signed by both
When is TR1 sent to S’s S for approval
After exchange
When is final CLLS sent
On morning of completion
P in COMP acronym
Purchase Deed
How are damages under CL claim affected by SCPC damages
Reduced by any contractual remedy
Docs enclosed w/ SDLT1
Cheque for SDLT
10.5/6 SCPC
Rescission for delayed completion
7.3.1 SCPC
4 working days to reply to TA13
Docs to send to LR to register new M
Certificate of reg and copy of debenture
Who always has to execute TR1
Always S
Why might B need advance warning to complete
To ensure funds are cleared
What must Ss S check before giving undertaking to remit funds to discharge mortgage
Check redemption figure of M
What does solvency search on Seller ensure
Existence, no insolvency and any floating charges
10.3 SCPC
Damages for delayed completion
Do you put addresses of the Transferor and Transferee in the TR1
No
If new charges appear in OS1, what should B’s S do
Ensure S’s S undertakings extended to cover all
What is the completion statement
Shows funds for buyer to complete
What is the remedy if MR = fraud/recklessness/substantial difference
Rescission + damages
If time for completion varied after exchange, what must the variation be
Incorporated into C
Why does MR for substantial difference under 10.1(b) automatically mean damages also possible
Passes ‘material difference’ threshold in (a)
What is an OS1
Priority search
What happens if redemption figure of M is more than purchase price
Additional funds needed from S
When is it negligent for S to rely on undertaking to remit funds to discharge mortgage
Mortgage not standard, or redemption figure above firm’s professional indemnity insurance
What kind of TR1 is sent to LR for registration
Certified copy
When should solvency search on seller be updated and why
Morning of completion as no priority period
What does CH give if company charge regitered
Certificate of reg of charge
Form for SDLT
SDLT1
What is the priority period given by OS1
30 working days from OS1R
When do you do the OS1 search from
The ‘search from’ date on the OCs (FIND THE DATE AND PUT IT IN)
What additional Q is always included in TA13
If there have been any changes since exchange
What does S’s S check prior to completion
Notified of receipt of monies for completion to take place
Is S negligent to rely on undertaking to remit funds to discharge mortgage - case
No - Patel
Why is rescission worse than compensation/damages
Costs are higher, as S keeps deposit AND has CL damages claim
Period to register title at LR
Within 30 working days of OS1R
What does B’s S check after completion
Report to client + date legal charge
SCPC on rescission for delayed completion
10.5/6
What does LR issue once transfer registered
New Title Docs - check for errors
Who must you do the OS1 search in the name of (2 scenarios)
Name of Buyer UNLESS there is a mortgage, in which case in name of Lender
Consequences of late/no SDLT1
Penalty + interest + LR will refuse reg
When must B also execute TR1
Only if new covenants given, or DoT in panel 10
When might individual get SP under CL
If damages inadequate
When is a solvency search on Buyer carried out
Only if B’s S acts for Lender as well
What does OS1 ensure (2)
No new entires + priority period
What may happen if B does not have sufficient advance warning to get necessary funds to complete
May need costly bridging loan
What do you round to when working out delayed completion remedies
The nearest penny (normal maths rules)
What check is done if B = individual, to check not bankrupt
K16
Doc if sale of part (what transfer deed doc)
TP1
What is it called when redemption figure of M is more than purchase
Negative equity
Patel ratio
S not negligent to rely on undertaking by S to remit funds to discharge mortgage
When can a notice to complete be served
If S ready and willing, and time for completion has passed
Three things that may be included in Panel 11 of TR1
Indemnity covenant, 2T and C(RoTP)A
What does B’s S send to B for finance
Financial Statement
If S had mortgage, what does B send to LR when registering
Copy of DS1
What is the remedy if MR means transaction materially different
Damages, 10.1(a)
What acronym is used to prepare for completion
COMP
What docs are enclosed w/ MR01
Fee + certified copy of debenture
Need the undertaking to remit funds to discharge mortgage be given in TA13
No
When is it common to act for Lender and Borrower - kind of transaction
If residential
What is 10.3 limited to
Buyer’s delay, so amend to include S’s delay as well
What does B’s S check prior to completion (four things)
TA13 replies, TR1 signed, legal charge signed by Buyer, and funds received from Buyer
Damages under 10.3 are what?
As of right - no need to prove loss
What is the effect of OS1 on the register
Freezes it
What are the remedies for title guarantee largely restricted to after completion and why
Damages, as C merges w/ PD once completed
Consequences of not registering at LR within period
Subject to 3rd party interests reg in period, and beneficial title only
What happens if B serves notice to complete and S fails to comply
B can rescind + get deposit + retain CL rights
How does LLP execute deed
Executed as a Deed by [LLP] acting by two Ms, then signatures
When are damages under 10.3 NOT available
B ready, wiling and able, and only delayed bc S has not vacated
MR01 is form for
Company Charge
Docs to send to discharge S’s M upon reg at LR w/ AP1
DS1
What is not included in working out damages under 10.3
Day of completion (if time for completion hasn’t passed, even if delayed)
C in COMP acronym
Completion + Undertakings form (TA13)
From when does OS1 ensure no new entires
OC ‘search from’ date
What is the usual way to complete
Using Code for Completion by Post
Consequences of late/no filing of company charge
Invalid against a/l/c, payable on demand, S negligent and cannot register at LR w/o certificate of reg
When are CL damages useful
Only if loss exceeds damages under C, or no provision for damages if S delays under SCPCs
What must happen by end of OS1 priority period
Registration
Who drafts the TR1
The Buyer’s solicitor
What doc shows total payable by B to complete
Completion Statement
When must SDLT1 be remitted to HMRC
Within 14 days of effective date
What is the default contract rate for damages
4%
Can an OS1 priority period be extended
No
Who drafts TR1
B’s S
What search is carried out pre-completion for unreg land + form
CLC, Form K15
SCPC on default time for completion + what is time
2pm, 9.1.2
Once TR1 agrees, what side forwards what
B’s S forwards engrossment for execution
When must company charge be registered by
21 days from day AFTER charge created
What suggests reasonable investigation on CPSEs
‘not so far as S is aware’
Form to register title at LR
AP1
Time to reply to TA13 for Seller’s S
Within 4 working days of receipt
Why do you not need to do a separate solvency search on the Seller if they are an individual
Will show up on OS1
How can parties rectify C/PD
At discretion of the court
When is date for completion fixed
At exchange
What does notice to complete force
Forces completion within 10 working days
What check is done if B = company, to check solvency
At CH
In whose names should OS1 search be done if there is a Lender
In the name of the Lender
How does an individual execute deed
Signed and delivered by [name] In the presence of: Witness (name + address)
When is TR1 dated
When funds received and docs sent by DC/1st class post
Two ways completion can be done
Personally or by Code for Completion by Post (phone)
Service of notice to complete under what SCPC - what governs serving of notices
1.3
Who is TA13 sent to and why
Ss S for practical info on completion + undertakings
What is the prescribed form to transfer legal estate in unreg land
No form, but usually TR1
What is always excluded in Panel 11 of TR1
3rd party rights
Period to complete from notice to complete
10 working days, EXCLUDING day of service
What does S’s S do after completion (4)
Report to client, date TR1 + send docs, arrange to discharge charge, and send client balance of sale proceeds
William Sindall ratio
‘Not so far as S is aware’ suggests reasonable investigation in CPSEs
Doc for transfer
TR1
Where do you copy wording for 3rd party rights exclusion
1.5 SCPC
What do the Buyer’s solicitors require before they can draw up the financial statement for the Buyer
The Completion Statement from the Seller’s solicitors
How does time become ‘of the essence’ to complete
By serving notice to complete
When must you calculate SDLT for post-completion
If purchase price given (USE TABLE AT BACK)
Why is MR under CL harder than MR under SCPC
B needs to prove inducement as well as error/omission
What can be claimed if C rescinded
CL damages
Docs to send for transfer of land w/ AP1
TR1 + SDLT5 + any other relevant docs (e.g. change of name or DoA of 2T)
What Panel of TR1 will show 2T appointed
Panel 11
When is rescission ONLY possible under 10.5/6
If time is ‘of the essence’
When is the effective date for SDLT1
Completion, or substantial performance
Remedies for MR under SCPCs
10.1
Two undertakings S’s S gives
Remit funds to redeem charge and forward DS1/ED/e-DS1 upon receipt
Why are originals not sent to LR
Destroyed
What cannot be claimed if C rescinded
Contractual compensation under 10.3
Why is solvency search on Seller unnecessary
B can rely on OC
AP1 is form for what
Registering title at LR
When does solvency search on Seller not apply and why
If Seller is individual, as interest of TiB would appear in OS1
What is the protection period of CLC Form K15
15 working days
What is a delay in completion if time is not of the essence
Only a warranty
How do you set out 10.3 damages
Copy out 10.3, then work out base rate + contract rate of outstanding purchase price x delayed days
