Case Study Flashcards
What did you understand by “best price” required by your client and to what extent do you see a trade-off between “best price” and conditions of sale (timings, conditions and warranties issued by the seller)?
It is a consideration of all the factors such as price, timeframe, and conditions attached to an offer which amounts to the “best price”.
As you were selling on behalf of an Administrator, what impact does this have on the conditions of sale, and how do you communicate it?
The property was ‘sold as seen’ and each party were informed that the Administrator would not be providing any assurances. It was the responsibility of the bidders to carry out their own investigations.
Sale of formula 1 force india team - court case Uralkali v Rowley [2020] established that no duty of care is owed by an office-holder to bidders in a sale process. This is as long as the process is fair and proper.
How did you verify the long leasehold interest and what are your conclusions regarding the impact of this on pricing and liquidity?
My clients solicitor provided a copy of the registered land registry title and plan to confirm the Company’s interest in the property.
The Law of Property Act 1925 s.52 states a lease of longer than three years must be by deed. Also any interest in land can only be created or disposed of by writing signed by the person creating or disposing of that interest.
Not considered as desirable as a freehold.
Requires landlords consent to assign/ could restrict subletting and alterations.
How did you select the joint agent and ensure that they were capable of providing high quality service?
I was aware that the joint agent had transacted on several commercial properties across Dorset. The firm was also a RICS regulated firm committed to setting and upholding the highest standards of excellence and integrity.
As part of being a regulated firm, they operated a complaints procedure and were members of the RICS Client Money Protection Scheme.
What did you do to ensure that the marketing particulars were lawfully prepared and what law / regulations did you follow?
I inspected at the property before preparing the particulars of sale and disclosed all material facts about the property. Clearly dated them and obtained my clients approval.
Main Law:
Misrepresentation Act 1967 - Mis-statements/false/ fraudulent statements or misrepresentations made during the pre-contractural enquiries by the vendor or their agent to the proposed purchaser.
Estate agents Act 1979 - Acting dishonestly during the sale or purchase of freehold or leasehold property.
Consumer protection from unfair trading regulations 2008 - criminal offence not treating customers fairly and / or providing misleading marketing information.
Main Professional Standard:
RICS UK Commercial Real Estate Agency, 1st edition, October 2016 Professional Statement.
And,
Real Estate Agency and Brokerage 3rd Edition, August 2016 Professional Statement.
What did you include in the heads of terms and how did you ensure that your clients position was protected in the draft?
I drafted the HOTs for my clients approval. They included
Date
Vendor details
Buyer details
Solicitor details
Timings
Price
Conditions (subject to contract)
Funding position
Tenure
AML requirement
To protect my client the HOTs included a sale by administrator section which clearly stated that no representations, warranties or guarantees in any respect, will be given by the Administrators or their agents.
How did you ensure site inspections were conducted in a safe and secure manner?
I followed the RICS Professional Standard, Surveying Safely, 2nd Edition (2019). This included obtaining as much information from the client as possible (i.e., access arrangements, fire plans, occupation and nature of occupation).
Plant was being removed from the site and appropriate PPE, included, safety footwear, high visibility clothing and a safety helmet.
Colleagues were aware of each inspection, the address, who was on site, and appropriate contact details. All these details are kept on our CRM system.
Please give me an example of when you applied 1 of the 5 rules of conduct?
I complied with rule 3 (Members and firms must provide good-quality and diligent service) by agreeing with my client the scope of the work to be carried out.
I also complied with Rule 1 (Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to RICS) by being transparent with our fee arrangement and also by ensuring my advice provided was objectively based on relevant and reliable evidence.
What would you do differently next time?
To improve next time, I would consider the use of drone imagery to display the full scope of the property and yard.
How did you act ethically?
I ensured that I complied with the terms of engagement agreed on by my client. I was transparent in the scope of work to be provided and the fee structure for undertaking the work.
I reported all offers to my client, including all necessary conditions and funding positions.
What are your key achievements?
I implemented and advised on a suitable Disposal strategy which enabled me to achieve my clients’ objective (to dispose of the property for the best price, following a period of marketing).
The continued relationship with the client.
