SELLER - PREPARATION OF THE CONTRACT

Question 1

WHAT STAGE OF THE LSCP IS USED IN THIS STAGE OF THE TRANSACTION?

Answer 1

Stage A (instructions) & Stage B (pre-exchange)

Question 2

WHAT DOCUMENTS ARE REQUIRED FOR THE SELLER’S SOLICITOR TO CHECK THE TITLE AND DRAFT THE SALE CONTRACT?

Answer 2

The title documentation

Question 3

WHAT IS CLASSED AS TITLE DOCUMENTATION?

Answer 3

Official copies of the register entries and title plan which will be requested from the Land Registry

Question 4

HOW ARE TITLE DOCUMENTATION OBTAINED FROM THE LAND REGISTRY?

Answer 4

1. Posting form OC1 and the required fee to the Land Registry
2. Through the Land Registry portal
3. Through the National Land Information Service

Question 5

WHAT ADDITIONAL DOCUMENT WILL BE REQUIRED IF THERE IS A MORTGAGE ON THE PROPERTY?

Answer 5

The mortgage deed which may be in the possession of the lender

Question 6

WHAT WILL THE SELLER’S SOLICITOR NEED TO PROVIDE THE LENDER WHEN REQUESTING THE MORTGAGE DEED?

Answer 6

The solicitor will need to provide an undertaking to the lender promising to take care of the documents, return them on demand and not to part with them until repayment of the loan

Question 7

WHAT ARE THE THREE REASONS FOR CHECKING TITLE?

Answer 7

1. It needs to be confirmed the seller can convey what they are going to contract to convey
2. It needs to be checked whether there are any defects in the title so they can be catered for
3. It needs to be checked whether there are any incumbrances so that can be dealt with in the contract

Question 8

WHAT LEGISLATION MUST CONTRACT COMPLY WITH?

Answer 8

S2 Law of Property (Miscellaneous Provisions) Act 1989

Question 9

WHAT DOES S2 LAW OF PROPERTY (MISCELLANEOUS PROVISIONS) ACT 1989 STATE IN RESPECT OF CONTRACTS?

Answer 9

A contract for the sale of land must be in writing, incorporate all the terms agreed between the parties and be signed by, or on behalf of, each party

Question 10

WHAT IS THE CONTRACT CURRENTLY BEING USED?

Answer 10

Contract Incorporating the Standard Conditions of Sale (Fifth Edition – 2018 Revision)

Question 11

WHAT IS INCLUDED ON PAGE 1 OF THE SALE CONTRACT?

Answer 11

• Date: this is left blank when the contract is drafted and filled in on exchange
• Details of the seller(s) & buyer(s)
• Property details: state that the property is freehold and provide a short property description
• Title details: provide the title number
• Specified Incumbrances: these would usually be referenced to the register
• Title guarantee: this is stipulated as ‘full’ or ‘limited’
• Completion date: this is left blank when the contract is drafted
• Contract rate: a rate of interest usually 4% above base rate
• Purchase price: is inserted
• Deposit: is inserted
• Contents price: where separate amounts are payable, this figure will be stated here
• Balance: the balance of the purchase price after allowing for deposit and contents
• Space for signature: the parties will sign their respective parts here

Question 12

WHAT IS INCLUDED ON PAGES 2 & 3 OF THE SALE CONTRACT?

Answer 12

The Standard Conditions of Sale (SCS):

• SCS 1 – defines the terms used in the general conditions
• SCS 2 – governs the formation of the contract and deals with the deposit
• SCS 3 – governs the disclosure of incumbrances by the seller
• SCS 4 – governs time limits for deducing and investigating title to the property
• SCS 5 – deals with responsibility for the property pending completion and insurance
• SCS 6 – deals with the timing and mechanics of completion
• SCS 7 – deals with the available remedies for breach of contract.

Question 13

WHAT IS INCLUDED ON PAGE 4 OF THE SALE CONTRACT?

Answer 13

Special Conditions of Sale

These are included on the back page of the agreement. These conditions may be used to override the general conditions

Question 14

WHAT IS MEANT BY TITLE GUARANTEE?

Answer 14

The seller gives the buyer various implied covenants to ensure that the buyer can sue the seller if after completion, the buyer discovers that they have been given an unexpectedly defective title.

Question 15

IF THE PROPERTY IS BEING SOLD WITH ‘FULL TITLE GUARANTEE’ WHAT THREE IMPLIED COVENANTS FOR TITLE WILL BE GIVEN?

Answer 15

• That the seller has a right to dispose of the property and will do everything they reasonably can to give title to the buyer
• That the property is sold free from undisclosed charges or adverse interests
• For leasehold property, that the lease is valid and subsisting and is not liable to forfeiture.

Question 16

IF THE PROPERTY IS BEING SOLD WITH ‘LIMITED TITLE GUARANTEE’ WHAT IMPLIED COVENANTS FOR TITLE WILL BE GIVEN?

Answer 16

The seller will be deemed to give the buyer similar implied covenants for title but does not guarantee that the property is free from charges and adverse interests

Question 17

WHAT DOES STANDARD CONDITION OF SALE 4 PROVIDE IN RESPECT OF TITLE GUARANTEE?

Answer 17

If no title guarantee is stipulated, the seller is deemed to sell with full title guarantee

Question 18

WHAT SEVEN DOCUMENTS ARE INCLUDED IN THE PRE-CONTRACT PACKAGE?

Answer 18

1. Draft contract in duplicate
2. Seller’s PIF
3. Fittings and Contents Form (form TA10)
4. Copies of the planning permissions and any other related planning documents
5. Copies of any other relevant documents
6. The EPC (if provided by the seller)
7. Evidence of title

Question 19

WHAT IS THE OVERALL AIM OF THE PRE-CONTRACT PACKAGE?

Answer 19

To speed up the transaction by supplying the buyer with most of the information they need about the property at an early stage

Question 20

HOW IS THE PRE-CONTRACT PACKAGE SENT TO THE BUYER’S SOLICITOR?

Answer 20

By either post or email

When sending by email, each document should be a separately identifiable attachment