Drafting

Question 1

What are the key documents to draft in Property Practice?

Answer 1

(1) Draft contract (Standard Conditions or Standard Commercial Property Conditions)

(2) License to Assign a Lease

(3) Lease

(4) Transfer Forms (TR1/TP1, AP1)

AP1 - Application to Change the Register

Less likely -

• License in the contract - but may be part of the contract drafting.
• Mortgage documents
• Land Registry Application

Question 2

Property Drafting: Contract for sale

What is the completion date according to both the SC and SCPC, if none is given?

What is the latest time for completion under both sets of conditions?

Answer 2

• 20 working days after the date of contract.
• 2pm.

Any time after 2pm = treated as next working day.

Question 3

Property Drafting: Contract for sale

How do you draft a completion date?

Answer 3

Special Condition [x]

Completion shall occur on [date], at [time], at which time ownership of the Property shall transfer to the buyer.

You must also tick the checkbox.

Question 4

Property Drafting: Contract for sale

If nothing is said, is time of the essence?

How would you vary the position in the SC and SPSC?

Answer 4

No.

Special Condition [x]

Condition 9.1.1 (SC 6.1.1) shall be varied so that time shall be of the essence and the innocent party can rescind the contract if completion does not occur on the completion date.

Question 5

Property Drafting: Contract for sale

How is the SC/SCPC position on deposit varied?

Answer 5

Special Condition [x]

Condition 3.2.2 (2.2.6 for SC) shall be varied so that the deposit shall be held by [deposit holder] as agent of the seller.

Question 6

Property Drafting: Contract for sale

If not varied, can a buyer occupy the the property before completion?

Answer 6

SC - Yes, as licensee if the seller allows.

SCPC - No.

Question 7

Property Drafting: Contract for sale

How do you draft a restrictive covenant?

How does the wording differ in relation to a positive covenant?

Answer 7

Special Condition [x]

The Buyer and their successors shall not… without the prior written consent of the Seller.

Positive covenant: not binding on successor.

Must also be in the TR1/TP1.

Question 8

Property Drafting: Contract for sale

How would the SC and SCPC be varied in relation to assignment?

Answer 8

Special Condition [x]

Condition 1.4.1 (1.5.1 for SC) is varied so that the buyer may not assign or transfer the benefit of the contract to any third party without the prior written consent of the seller.

Question 9

Property Drafting: Contract for sale

Would a buyer be bound by any easements on the property if the SC/SCPC are not varied?

Answer 9

The buyer is bound to those listed in SCPC 4.1 or SC 3.1.2.

To be clear, the seller should set out the particular incumbrances in the contract.

Question 10

Property Drafting: Contract for sale

When would the seller need to vary the SC/SCPC in relation to title guarantee?

Answer 10

When not selling with full title guarantee.

Question 11

Property Drafting: Contract for sale

Does the seller need to vary the SC/SCPC if they are bound by a personal indemnity covenant that affects the property?

Answer 11

No. The SC/SCPC provide that the transfer deed will contain an indemnity from the buyer to the seller against liability for future breaches of the obligation.

Question 12

Property Drafting: Contract for sale

If VAT is not mentioned in the contract, is the purchase price inclusive or exclusive of VAT?

Answer 12

Residential: Inclusive.
Commercial: Exclusive.

For CSC - the seller may need to vary this if buyer is VAT-sensitive. They do this by ticking A1.

Question 13

Property Drafting: Lease

How do you draft a Jervis v Harris clause?

Answer 13

If the Tenant does not rectify any breach of obligation notified to it within [x] months of service of the Landlord’s notice, the Landlord may enter the Property to rectify the breach and the Tenant shall pay to the Landlord on demand as a debt the costs and expenses of doing so”

Question 14

Property Drafting: Lease

Draft a tenant’s break clause.

Answer 14

To terminate this Lease, the Tenant must serve on the Landlord not less than 6 months’ written notice expiring on and including [Break Date] provided that:

• Rent up to and including the Break Date is paid in full;
• The obligations in this Lease are fully observed and performed up to and including the Break Date; and
• the Property is returned to the Landlord with vacant possession on the Break Date.

Question 15

Property Drafting: Lease

Draft a qualified covenant against assignation.

Answer 15

The Tenant may not assign the whole or part of this Lease without the prior written consent of the Landlord.

Question 16

Property Drafting: Licence to Assign

What are the key terms of a licence to assign?

Answer 16

(1) Definitions
(2) Licence (or ‘Consent to Assign)
(3) AGA
(4) Costs
(5) Indemnity for breach

Question 17

Property Drafting: Licence to Assign

In the Licence, is the lease term defined as from the start of the lease or from the assignment?

Answer 17

From the start.

Note: it is the residue being assigned.

Question 18

Property Drafting: Licence to Assign

How do you set out the following clause:

(2) Licence

May also be ‘Consent to Assign’

Answer 18

In consideration of the Assignee’s covenants in this Licence, the Landlord consents to the Assignor assigning the residue of the Lease to the Assignee.

It is a condition of this consent that the Assignor enters into the Authorised Guarantee Agreement simultaneously with the completion of this Licence.

(delete AGA reference if not being given).

Question 19

Property Drafting: Licence to Assign

Draft the clause:

(4) Authorised Guarantee Agreement

Answer 19

The assignor covenants to observe and perform obligations set out in the Authorised Guarantee Agreement and takes effect on the date that the assignor is released from the tenant obligations of the Lease.

Question 20

Property Drafting: Licence to Assign

Draft the clause:

(5) Costs

Answer 20

The Assignor shall pay all reasonable costs and expenses exclusive of VAT of the Landlord in relation to this Licence.

Question 21

Property Drafting: Licence to Assign

How do you set out the following clause:

(x) Indemnity

Answer 21

The Assignor and Assignee shall indemnify the Landlord against all liabilities, costs, expenses, damages and losses incurred by the Landlord arising from any breach of the terms of this licence.

Question 22

Will Drafting

Draft the Commencement Clause.
Draft the Revocation Clause.

Answer 22

THIS IS THE LAST WILL AND TESTAMENT OF ME [name] of [address]

I REVOKE all former wills and testamentary dispositions made by me.

Next is appointment of executors (and trustees if relevant) and guardians.

Question 23

Will Drafting

Draft the gifts clauses.

Answer 23

SPECIFIC GIFTS

4. I GIVE the following specific legacies free of tax:

(a) my ring to [x]

PECUNIARY LEGACIES

5. I GIVE the following pecuniary legacies to [x]:

(a) the sum of one thousand pounds (£1,000) to my sister [x].

RESIDUARY GIFTS

I GIVE all the rest and residue of my estate subject to the payment of my debts, funeral and testamenty expenses and legacies (‘my residuary estate’) to [x].