Land and property missing bits

Question 1

What are the differences in special conditions in SCPC?

Answer 1

Special condition 3 - tick box for limited title guarantee

6 - if deposit and balance of purchase price is coming from account other than buyer’s solicitor

8 - specific terms of the transfer e.g. seller wishes to reserve rights (e.g. covenants)

9 - options to tick for VAT treatment, capital allowance and rights of residential tenants in a property (e.g. block of flats)

Question 2

In relation to alterations, what can the landlord require under s19(2) LTA?

What about s19(3) in relation to use covenants?

Answer 2

s19(2): Payment in compensation for loss of value to reversion
Reinstatement of premises at end of lease term
Payment of landlord’s expenses in giving consent

s19(3): Landlord cannot demand payment (increasing rent. lump sum) for granting consent unless the change of use also involves a change to structure of property. Landlord can recover expenses for granting consent

Question 3

What enforcement options does a local authority have available if there has been a breach of planning control?

What are the time limits?

Answer 3

Enforcement notice (gives 28 days notice that land must be restored/comply with conditions. If not followed - fine owner and enter themselves and carry out it out and claim costs from owner)

Stop notice - can only be served after enforcement notice (stop use immediately) - can’t be served where activity ongoing for 4 years

Breach of condition notice (similar to enforcement but for planning condition)

Injunction

4 years - building works from when they were substantially completed, change of use to single dwelling house

10 years - breach of planning condition (from breach), other change of use

Question 4

What are the enforcement options and timescales for breach of building regulations?

Answer 4

Prosecution - has 6 months after discovering breach. Prosecution may take place up to 2 years after completion of building work

Enforcement notice - can be served up to 1 year after completion (gives landowner 28 days to rectify, otherwise local authority can do so and claim cost)

Injunction - if unsafe, no time limit

Question 5

What is the default completion date in the SCS and SCPC?
What is the default deposit under SCS and SCPC? How can this be varied?

Answer 5

20 working days after date of the contract at 2pm

10% - by a special condition

Question 6

What is the rule on specified incumbrances in SCS vs SCPS?

Answer 6

Relates to rule that latent incumbrances must be disclosed (rights burdening property which cannot be found on reasonable inspection of land) e.g. covenants and easements

SCS - seller needs to disclose any specified incumbrances registered at Land Registry, Land Charges Registry + Companies House - in breach if they do not

SCPC: buyer takes property subject to any incumbrances which a prudent buyer would have discovered through searches and enquiries

Question 7

How many pre-written special conditions in SCS? What do each refer to?

Answer 7

7

1-tie contract to SCS
2-amend title guarantee from full to limited (e.g. if PR)
3-included + excluded contents (e.g. certain chattels)
4-Vacant possession vs sold subject to lease or tenancies: …
5- Modify completion date
6- Representations - liability is limited to written representations by either party (unless fraudulent or reckless by something they say)
7-Occupier’s consent - adults who live in property apart from seller confirm they will leave property (as worried they have overriding interest) - advised to seek independent legal advice (seller’s solicitor cannot give this!!)

Question 8

When would a conveyance cast doubt on seller’s title?

Answer 8

If executed under power of attorney - unclear whether power of attorney still in force so relevant power of attorney would need to be produced

Question 9

What other documents must be included in epitome of title where death?

Answer 9

Death certificate if property has passed by survivorship
Grant of representation and an assent if property has passed under will r intestacy

Question 10

When does a transfer a transfer deed come into effect? Who should it be witnessed by for an individual? A company (4 options)?

Answer 10

When it is delivered (dated) - independent witness who signs and print their full name and address

Can be company seal attached + two directors, or 1 director and company secretary
No company seal - 2 directors, or 1 director and company secretary
1 company directors and witnessed by independent witness
Signed by senior employee (not director or company secretary) who is authorised under power of attorney

Question 11

What are the necessary solvency searches? priority periods?

Answer 11

Buyer and lender = bankruptcy (K16) - confers priority period of 15 working days
Buyer is a company - company search against buyer (no priority period)
Seller is a company - company search against seller (no priority period)

Question 12

When must SDLT be paid to avoid penalties? LTT?

What about a charge at Companies House? Can the deadline be extended? When does this not apply?

Answer 12

Within 14 days of ‘the effective date’ (completion, unless tenant goes into occupation earlier)
Within 30 days

Within 21 days beginning day after creation of charge (no it is strict - would need a court order to allow filing out of time if missed).
Charges given by individual (e.g. residential transactions)

Question 13

What is the relevant date for new leases?

Answer 13

On or after 1 Jan 1996

Question 14

Is notice required to enforce a Jervis v Harris clause?

Answer 14

No, no s146 notice needed

Question 15

What is the tenant’s statutory right to carry out improvements?

What can the landlord offer?

Answer 15

Even if lease contains absolute covenant, tenant can circumvent this if it considers alterations as improvements
Can serve notice on landlord
If landlord objects, can apply to court. Could will give permission if:
-Add to letting value of property
-Reasonable and suitable to character of property
-Not diminish value of other property belonging to landlord
If landlord does not object within 3 months, tenant may go ahead

Landlord can offer to carry out works itself + increase rent - tenant does not have to agree to this - however tenant can then not ask court for permission

Question 16

Who has to execute a TR1?

Answer 16

Transferor always has to execute TR1 (in the case of executors - only 1 can sign provided they have the permission of the other).
Transferee(s) must execute if:
-are tenants in common or agree to hold property on trust for someone else
-are providing an indemnity covenant, or are entering new covenants and easements

Question 17

What is used to document a rent review? When may the tenant have to pay SDLT or LTT as a result?

Answer 17

Rent review memorandum

If the rent review is before 5th anniversary of the term commencement date (on or after will not have to pay)

Question 18

What is the Code for Leasing Business Premises? What does it contain?

Answer 18

Code which applies to members of the Royal Institution of Chartered Surveyors (RICS) and RICS regulated firms

Mandatory requirement (must be followed) and good practice (should - must unless exceptional circumstances)

Question 19

What are the mandatory requirements for the Code of Leasing Business Premises?

Answer 19

-Lease negotiations - must be in constructive + collaborative manenr
-Unrepresented party - must be advised about existence of code (+ seek professional advice)
-Landlord ensuring heads of terms compliant with Code are agreed before draft lease circulated

Question 20

When will an agreement for lease be necessary/advisable?

Answer 20

When the parties want to commit to completing lease, but either are not ready or conditions need to be satisfied

Question 21

What are the usual quarter days for rent payable under a lease?

Answer 21

25 March, 24 June, 29 Sept, 25 Dec

Question 22

What do you need to work out the NPV? (they will give the formula) When is the NPV relevant?

Answer 22

Start date of the lease and lease term e.g. 10 yrs
Rent payable for each of the first 5 years

For shorter leases with market rent payable (long leases that pay ground rent use the premium paid as the bases for SDLT or LTT)

Question 23

Where VAT is payable, what does the SDLT include?

Answer 23

purchase price + VAT

Question 24

Can the priority period be extended for OS1, K15 searches etc?

Answer 24

No - each search has a fixed priority period

Question 25

What goes in the property, proprietorship, charges register?

Answer 25

Property: describes property and rights land benefits from
Proprietorship: register owners name + address, class of title and entries affecting ownership
Charges: rights burdening property

Question 26

What are the continuing breaches?

Once and for all?

For forfeiture

How can these be waived?

Answer 26

breach of repair, breach of user, failure to comply with insurance obligation

non-payment of rent, unlawful assignment or underletting, insolvency event

Demanded rent (includes landlord’s agent sending out rent demand)

Question 27

With fully qualified covenants regarding alienation, what must the landlord do regarding consent (s1 LTA 1988)?

What if it breaches this?

Answer 27

Give written consent within reasonable time
If refuse - must provide written reasons

Liable for tortious damages for breach of statutory duty

Question 28

What the new lease/old lease cut off?

Answer 28

1 Jan 1996

Question 29

With new leases, when is there no automatic release for tenants? Landlords?

Answer 29

Tenants - if an excluded assignment (breach of alienation covenant)
Landlord - not automatically released when assign reversion - need to get permission from tenant (or court if tenant refuses)

Question 30

S17 Tenant Default Notice?
s18 Liability for variations?
s19 overriding leases?

Answer 30

s17 - where landlord wants to pursue former tenants (e.g. due to AGA or old lease) who remains under lease for a fixed charge - must serve notice within 6 months of charge becoming due (so can only recover last 6 months rent for example)

s18 - Former tenants not liable for variations which could not have been anticipated (does not include changes in rent)

s19- formed tenant called to pay fixed charges due to assignee not paying - can request overriding lease (equal to remainder of term plus 3 days) - allows to become immediate landlord of assignee and ensure compliance

Question 31

What tenancies can benefit from security of tenure?

Answer 31

Fixed term or periodic tenancy

Occupied by tenant (if leaves vacant or underlets whole or part (for part - just wouldn’t get it for those bits that have been underlet)

For the purpose of a business e.g. charity shop, tennis club, part of building residential which further tenants business

Question 32

What tenancies are excluded under s43 LTA?

Answer 32

Agricultural
Mining
Service (e.g. employment)
Fixed term of 6 months or less (can become protected if in occupation for 12 months or more whether successive tenancies of if tenancy renewable beyond 6 months) e.g. A letting of an office for a fixed term of six months, with an option to renew for a further such term

Question 33

What are the 6 grounds a landlord can oppose a new lease? What notice? Which are mandatory and which is discretionary

Answer 33

Section 25:
Mand - court has to grant possession
Disc - even if shown, court can decide

-Persistent + serious breach of repairing obligation (disc)
-Persistent delay of paying rent (disc)
-Serious and persistent other breaches of covenant (disc)
-Landlord offers suitable alternative accom (mand)
-Landlord intends to demolish or reconstruct premises (or substantial construction work) (mand)
-Landlord intends to occupy for itself and has owned reversion for at least 5 yrs before (mand)

Question 34

When can compensation be given for s25? How calculated?

Answer 34

If no fault of tenant

Occupied less than 14 yrs (1x rateable value)
Occupied 14 or more (2x rateable value)

Question 35

What are the timing requirements of a s25, 26 and 27 notice?

Answer 35

s 25: no less than 6 months + no more than 12 months before date of termination (date of termination must be on or after end of lease)

s26: min 6 months and max 12 months before proposed commencement date (landlord has 2 months to serve counter notice - must oppose based on the 6 grounds like in s25). Can only serve s26 if lease originally granted for more than 1 year (if one year or less cannot serve!!!)

s27: 3 months notice of intended termination date (must be no earlier than end date of lease) - can simply vacate but good practice to notify

Question 36

Interim rent?

Answer 36

Court can fix rent during holding over period at open market rate - payable from earliest date of termination could have been specified in s25 notice, or earliest date of proposed commencement in s26

Question 37

Court order regarding notices?

Answer 37

Either tenant or landlord can apply to court for grant of new lease - tenants 14 days to revoke order if not happy with terms determined by court or changes mind

Question 38

Who is the competent landlord? What notices does this refer to?

Answer 38

First in chain of landlords where freehold or leasehold will not come to an end in 14 months time (e.g. if subtenant wanted to serve notice, but tenant also about to expire, subtenant should serve on tenant’s landlord)

S25 + s26

Question 39

When will a notice expire if served on 1 Jan (6 months)
What about 31 August (6 month)

Answer 39

Notice expires on same date it was served
1 July

28 Feb (as last day of month - will end of last day of month if shorter)

Question 40

When must a landlord serve a s146 notice? What must it detail? When can the tenant serve a counter-notice?

Answer 40

For any breach other than non-payment of rent - intention to forfeit, detail remedy + give tenant reasonable time to remedy (or consider position if not capable of remedy e.g. breach of assign or sublet)

Where s146 notice is served - tenant can serve counter-notice if lease for 7 years or more + there are at least 3 years of term left to run - has 28 days to serve a counter notice (landlord must then get leave from court)

Question 41

What are the remedies for non-payment of rent?

Repairing breaches?

All other breaches?

Remedies involving security arrangements?

Answer 41

Debt action, CRAR, forfeiture

Damages (s146 - limited to reduction in value of reversion), forfeiture, Jervis v Harris, specific performance (last resort)

Damages, forfeiture, specific performance, injunction

Guarantor, former tenant, rent deposit

Question 42

When can tenant apply for relief from forfeiture? When likely to be granted?

Answer 42

Either s146 or rent

For non-payment of rent - relief if settle all rent arrears and landlords costs

Question 43

When can CRAR be used? Requirements?

Answer 43

Has to be purely commercial
Min of 7 days principal rent owed (includes VAT and interest but NOT service charge)

7 clear days notice to enter premises (exclude Sunday and bank holidays) + 7 further clear days if intend to sell any seized goods

Question 44

What is action in debt limited to?

Answer 44

Rent due in 6 years before issue of proceedings - includes rent, service charge, insurance

Question 45

For leases, when is OS1, OS2 and OS3 search used?

What enquiries will tenant’s solicitor raise?

Answer 45

OS1 for lease of whole, OS2 for lease of part, OS3 if lease not registered (doesn’t confer priority)

CPSE1 and CPSE3 (specific for leases)

Question 46

What is a report on title?

Answer 46

Report which buyer’s solicitor prepares and includes all relevant info about property addressed to client (e.g. investigations on title, search results and replies to enquiries) - take form of letter or standalone doc

Question 47

What are the different types of survey to identify any physical defects with property?

Answer 47

Basic valuation: minimum for mortgage being obtained, identify any major defects, should be advised to obtain fuller survey
Homebuyer report: More detailed for properties aged less than 150 yrs in reasonable condition
Full structural survey: Listed, ha had extensive renovations or where extensive alterations planned

Question 48

For Private Residence Relief, what is the max size? Any other important rules?

Answer 48

Where don’t have to pay CGT on disposal of home

-5000 square metres (0.5 hectares)
-Not been let out and not been for business purposes
-Married couples can only have 1 PPR betwene them

Question 49

When is the deemed date of disposal for CGT?

Answer 49

EXCHANGE of contracts

Question 50

When is the Law Society Conveyancing Protocol not applicable?
Key themes?
Who must adopt it?

Answer 50

New build homes

Buyer’s solicitor - should only make enquiries that are essential to client’s best interest
Seller’s solicitor - confirm + update replies to enquiries completed more than 2 months earlier

Solicitors who are members of Law Society’s Conveyancing Quality Scheme

Question 51

What are the common disregards for hypothetical lease?

Answer 51

Operate to ignore what tenant has done voluntarily - tenant should not be penalised with higher rent (if for example improved premises)

Question 52

Who is responsible for insurance in commercial lease?

Insured risks?

Answer 52

Landlord

Lease of whole - landlord insure whole and tenant will refund whole of premium
Lease of part - insure whole, each tenant responsible for proportionate part of premium

Insured risks - excluded from tenant’s repairing obligation (except in not paid out due to tenant’s negligence)

Question 53

Commercial tenancies
Who is responsible for the repair of a lease of whole?
Part?

Answer 53

Whole - solely tenant - interior, exterior, structural repair

Part - responsibility of their demise but not common parts (hallways, lifts, staircases etc) which are landlord’s responsibility
Landlord will recover cost of doing so by a service charge (each tenant pays proportionate share depending on how much they lease)

Question 54

What is renewal?

Why is good repair and condition more onerous?

Answer 54

Where premises is damaged beyond repair - tenant not responsible under simple repairing obligation

Condition - refers to stuff like condensation

Question 55

What is standard in the Law Society Completion by Post?

Answer 55

• Immediately following completion, the seller’s solicitor holds the transfer deed and other deeds and documents to the buyer’s solicitor’s order. This means that the buyer’s solicitor can direct what happens to them.
• As soon as possible, and no later than the end of the working day after completion, the seller’s solicitor undertakes to send the transfer deed and other deeds and documents to the buyer’s solicitor.

Question 56

Regarding planning permission, what does the LLC1 show? What does the CON29 show?

Answer 56

-LLC1 - planning permission that have been granted
-CON29 - planning consents, refusals and completion notices

Question 57

What are the buyer’s options for dealing with covenants?

Answer 57

Where land’s current use in breach but no objection received - obtain indemnity insurance policy (at seller’s expense)

Approach person with benefit (PWB) for consent to breach covenant (may require payment or refuse)

Can apply to Upper Tribunal (Land Chamber) in certain circumstances - expensive and time consuming

If proposed use will breach covenant - first option should be to try and get insurance before approaching PWB (insurers usually require no contact been made with PWB)

Question 58

When does a lease expire if in 10 years from and including 4 July 2023? From 4 July 2023?

Answer 58

3 July 2033

4 July 2033 (starts on day after)

Question 59

What is the standard certificate of title format?

Answer 59

City of London Law Society Certificate of Title

Question 60

What are the different class of title?

Answer 60

Title absolute: no issues
Qualified title: Specific defect in title (e.g. deed known to contain covenants missing)
Possessory: registered proprietor has physical possession but no title deeds or claiming through adverse possession (squatters rights)
Good leasehold - leaseholder cannot provide evidence of landlord’s title - can be upgraded easily

Question 61

What are the 5 factors considered in s15 TLATA with disputes involving co-owned land

Answer 61

a) Intention of person(s) who created trust
b) Purposes for which property subject to trust is being held
c) Welfare of any minor who occupies (or might reasonably be expected to occupy)
d) Interests of secured creditor of any beneficiary
s15(3) general sweeper - the wishes of beneficiaries who are over 18

All relevant factors must be considered equally

Question 62

When is a deed of conveyance used?

Answer 62

For unregistered land

Question 63

What is the occupier’s consent special condition?

Answer 63

Occupier’s consent - adults who live in property apart from seller confirm they will leave property (as worried they have overriding interest) - advised to seek independent legal advice (seller’s solicitor cannot give this!!)