Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

FLK2 - Property Practice > Stage 5: Pre-contract Searches & Enquiries > Flashcards

Stage 5: Pre-contract Searches & Enquiries Flashcards

1
Q

why are these enquiries and searches important?

A

Buyer’s solicitor must undertake as much due diligence as possible because the principle of caveat emptor applies (i.e. buyer beware).

o Important to do this pre-contract as they can withdraw without being in breach of contract

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

what is due diligence?

A

process of gathering as much information about the property (inc. title investigation, search and enquiries) for the client before exchange

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

what happens once due diligence has been undertaken?

A
  • Once complete, the buyer solicitor will write a report inc. the info, legal and practical issues for the client to consider pre-exchange
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

what information is the solicitor required to disclose?

A
  • The seller is not obliged to disclose information aside from the title.
  • This does not mean they can give misleading answers to enquiries.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

what is the seller’s liability?

A

so long as they have not misrepresented, the seller will not be liable for any defects that later some to light.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

what is the role of the buyer’s solicitor?

A

o Decide the relevant searches and enquiries and analyse results
o Produce a report for the client (i.e. buyer and/or lender) regarding the legal and practical implications of these results and title investigation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

when might a negligence claim arise?

A
  • Could be a negligence claim if there is a failure to check which leads to a loss
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

who else are these searches important for?

A
  • Information also important for lender’s solicitor. If there is a different solicitor acting for the lender, they may ask the buyer’s solicitor for this information.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

how will the searches be undertaken?

A
  • The firm will be registered with a provider, they will pay for a search package, this is sent to the National Land information Service who will provide the info
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

what searches are relevant to all properties?

A
  1. survey and personal inspection
  2. local search
  3. water and drainage search
  4. pre-contract enquiries
  5. environmental searches
  6. flood searches
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

re: survey and personal inspection

explain this

A
  • Should always be recommended. Different types i.e. full structural survey if client plans to undertake alterations, ‘homebuyers valuation and survey’ is cheaper and contains advice on necessary elements
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

re: survey and personal inspection

what will the lender require?

A
  • Lender will always require a ‘valuation’ survey  this determines whether the property can offer adequate security for the loan
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

re: survey and personal inspection

what is a personal inspection?

A
  • Personal inspection  will reveal more than is evident on the plan i.e. any inaccuracies or if there is a cable, drain or pathway (rare in residential)
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

re: local search

what is this?

A
  • Collective term for the below:
    1. Local land charges search (Form LLC1)
    2. Standard enquiries of the local authority (From CON29)
    3. Optional enquiries (Form CON290)
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

re: local search

explain local land charges search

what form is this made on?

A

(Form LLC1) - provides details of any financial charges or restrictions imposed by public authorities under statute i.e. planning consent, tree preservation order, conservation designation orders

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

re: local search

explain standard enquiries

what form is this made on?

A

Form CON29 - reveals planning permissions, restrictions on permitted development, contaminated land, liability for road repair, enforcement/stop notices for planning breaches

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

re: local search

explain optional enquiries

what form is this made on?

A

Form CON290  covers diverse matters i.e. environmental pollution, rights over common land, completion notices

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

re: local search

what do these searches relate to? what must the solicitor consider?

give an example

A
  • Relates to the property only. There solicitor will need to consider whether enquiries of the adjoining land are necessary

i.e. if the buyer is buying the house because it has a particular view of a field, enquiries should made of the adjoining land to see if there is any proposed development on that field

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

re: water and drainage search

who are these enquiries made with?

A
  • Enquiries made with the statutory undertaker i.e the water company.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

re: water and drainage search

what do these searches reveal?

A

o If the drains and sewers are adopted (i.e. responsibility of statutory undertaker and not the property owner);
o If the property is connected to a public sewer for foul and surface water;
o If the property is connected to a public water supply

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

re: water and drainage search

what happens if the statutory undertaker isn’t responsible for the drains/sewers?

A
  • If not, the buyer is responsible to maintaining which can be expensive or bringing them up to standard if the undertaker decides to adopt them
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

re: water and drainage search

what forms are theses enquire made on?

A

CON29DW  residential

CommercialDW  commercial

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

re: pre-contract enquiries of the seller

how are these usually made?

A
  • Usually a standard set of enquiries, but additional enquiries can be made
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

re: pre-contract enquiries of the seller

give examples of the information which may be requested

A
  • Enquiries may include: details of any disputes or third parties in occupation; compliance with covenants; any planning permissions; boundary maintenance
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Q

re: pre-contract enquiries of the seller

is the seller obliged to answer?

A
  • The seller may refuse to answer enquiries put to them, relying on the caveat emptor principle (not inc. any information about defects in title). However, this is likely to deter the buyer.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
26
Q

re: pre-contract enquiries of the seller

when may a seller be liable?

A
  • Any incorrect replies may amount to misrepresentation
27
Q

re: environmental searches

explain these

A
  • Different types. Most common is a ‘desktop search’  looks at plans of the area, information published by the LA and environment agency
28
Q

re: environmental searches

what should be advised if contamination is uncovered?

A
  • If contamination is uncovered, client may want to instruct a specialist environmental surveyor or take out insurance.
  • Cleaning up contamination can be expensive and the solicitor will likely be negligent if they have not properly advised
29
Q

re: flood searches

where can this information be obtained?

A
  • Information can be online, but this is not property specific. There are property-specific searches at a cost.
29
Q

re: flood searches

what is the key issue?

A
  • Key issue to uncover is whether the property can be insured at normal rates
30
Q

re: flood searches

what is the position regarding insurance?

A
  • Government-back flood insurance ‘Flood Re’ is available for residential properties but not commercial properties (inc. buy-to-let)
31
Q

what searches & enquires are relevant to particular properties?

A
  • chancel repairs search
  • mining search
  • canal and river trust search
  • commons search
  • railways
  • highways
  • unreg land search
  • company search
32
Q

re: chancel repair search

explain this

A
  • Some property owners in a Church of England Parish where there was a medieval church & vicar could be liable to pay the costs of repairing the church’s chancel. A buyer is only bound in certain circumstances
33
Q

re: chancel repair search

when is the buyer bound in reg land?

A

the previous transfer for value took place before 13 October 2023 (the liability to repair lost overriding interest status on this date)

34
Q

re: chancel repair search

when is the buyer bound in unreg land?

A

it is in the title deeds or protected by a caution against 1st registration (could be lodged after completion and before 1st registration)

35
Q

re: chancel repair search

when should this be done?

A
  • Some firms therefore undertake this search in every conveyance, or they may just advise insurance
36
Q

re: mining search

when and how should this be done?

A
  • Coal mining search of the Coal Authority on Form CON29M should be made if a search of the Coal Authority’s map identifies the property is in a mining area
  • Similar searches can be undertaken i.e. tin & clay in Cornwall, Devon, Somerset & Dorset; limestone in the West Midlands; brine & salt in Cheshire
37
Q

re: mining search

what should be done if mining is identified?

A
  • If identified, the solicitor should advise a surveyor is instructed to check for subsidence and Index Map search on form SIM to check the mines and minerals are not registered under separate title
37
Q

re: canal and river trust search

when should this be done?

A
  • Relevant if property is adjacent to a river or canal as the buyer may be liable for repairs of the waterway, banks, towpath etc and if there has been flooding
38
Q

re: canal and river trust search

where is the information obtained from?

A
  • This information can be obtained from the Canal and River Trust
39
Q

re: commons search

when is this relevant?

A
  • Relevant if the property is on a green-field site or village green, there might be common rights i.e. right to pasture
40
Q

re: commons search

how is this undertaken?

A
  • Optional Enquiry 22 in Form CON290 as part of the local search
41
Q

re: railways

when is this relevant? what will the buyer want to know?

A
  • Relevant if the property adjoins a railway line. Buyer will want to know if they are obliged to maintain the boundary or if there are restrictions on carrying out work near the boundary. Network rail will not answer these types of enquiry.
42
Q

re: railways

how is this search undertaken?

A

No general search available. The buyer’s solicitor should:
o Search specific and proposed railway plans i.e. HS2
o Enquire with the seller
o Check reply to enquiry 22 CON29 in the local search as this might reveal a proposed scheme

43
Q

re: highways

when is this relevant?

A
  • Relevant if there may be private ownership separating the property & highway
44
Q

re: highways

how is this search made?

A
  • Enquiry 2 of CON29 on local search will provide information about the roads adjoining the property but this won’t include verges, pavements, forecourts etc
  • The solicitor can send a plan to the highway authority and ask them to confirm on the plan where the boundaries of the public maintainable highways are (i.e. areas which the highway authority maintain)
45
Q

re: highways

why might the buyer need more information than that provided on CON29?

A
  • The buyer might need information about the verges etc if the property is going to be redeveloped. The buyer will need to know who owns the verge etc because if a third party owns this, it could create a ransom strip (i.e. a small piece of land that blocks access to the property)
46
Q

re: unreg land search

what does this involve?

A
  • An Index Map Search (‘SIM’) and a Land Charges Department search against the seller and previous estate owners
  • SIM is also used where there is a mines/minerals reservation in the title
47
Q

explain company search

A
  • Companies House to be checked if the seller is a company. This will confirm whether they have capacity to contract and any fixed/floating charges
48
Q

what additional searches will the lender do?

A

Lender’s solicitor will also do a bankruptcy/insolvency search just before completion, but it is also common to do this before exchange
o Individual  Form K16 to Land Charges Department
o Company  company search

49
Q

how is bankruptcy checked of an individual?

A

Form K16 to Land Charges Department

50
Q

how is bankruptcy checked of a company?

A

company search

51
Q

what issues are commonly uncovered from search results and replies?

A

Planning Permissions (PP)
Road Adoption
Tree Preservation Orders (TPO)
Smoke Control Orders
Conservation Areas
Occupiers

52
Q

re: planning permission

how would this be uncovered?

A

LCC1 result gives summary of any PP.

53
Q

re: planning permission

what must the buyer’s solicitor do if revealed?

A

o Check with the seller whether the PP has been implemented, any conditions and if they have been complied with (enforcement action can be taken up to 10 years after the breach)
o Obtain a copy of the PP from the LA or seller
o Check the CON29 for enforcement and stop notices and CON290 for completion notices to check enforcement proceedings haven’t been taken

54
Q

re: road adoption

how would this be uncovered?

A
  • CON29 of the local search
55
Q

re: road adoption

what may this reveal?

A

info about roads & highways i.e:
o Whether an adjoining road is a public highway. If not, there is no automatic right of use and the LA does not pay for its maintenance. The solicitor would need to establish the buyer’s right to use the road i.e. an express easement and any private obligation to pay
o Whether the LA plans to adopt the road and if so, whether the frontagers (i.e. the buyer), will need to contribute to the cost of bringing it up to standard. The solicitor will need to find out the expected date and cost.

56
Q

re: tree perseveration orders

how is this uncovered?

A
  • Revealed under LLC1 result
57
Q

re: tree perseveration orders

what must the buyer’s solicitor do?

A

o Tell the client it is a criminal offence to lop or fell the tree without LA consent
o Raise an enquiry with the seller
o Obtain a copy of the TPO and check it has been complied with

58
Q

re: smoke control orders

how is this uncovered?

A

Revealed under LLC1 result.

59
Q

re: smoke control orders

what is the purpose and when might this be uncovered?

A
  • Purpose is to restrict the use of non-smokeless fuels in domestic fireplaces.
  • Might be a problem if the property has a fireplace the buyer wants to use.
60
Q

re: conservation areas

how is this uncovered?

A

Revealed under LLC1 or CON29.

61
Q

re: conservation areas

what must the buyer’s solicitor do?

A
  • Buyer must be informed it will be difficult to change the property.
62
Q

re: occupiers

what may the buyer require if this is uncovered?

A
  • The buyer’s solicitor must require the seller to obtain agreement to release their rights and vacate the property from the occupier.
  • Usually dealt with in the contract.

FLK2 - Property Practice (16 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions