L&L Flashcards
UK Commercial Estate RICS UK Commercial Estate Agency Professional Statement, 2016 - Principles
- Act in an honest, fair and professional manner
- Carry our work with due skill, care and diligence
- Terms of business that are fair and clear
- Avoid conflicts of interest
- Not to discriminate
- All communications to be clear and timely
- Marketing material to be honest and truthful
- Clients’ money to be held in separate accounts
- Hold appropriate PII
- Make clear your obligations to your client / each party
- Realistic assessments of prices / rents
- All meetings, inspections and viewings to be carried out with clients wishes and safety
Landlord and Tenant Act 1988
Ensure statutory duty exists on the landlord to deal with consents diligently and not unreasonably withheld or delayed.
Failure to do so can result in a successful claim for negligence.
RICS Prof Statement Code for Leasing Business Premises 2020
Improve quality and fairness of negotiations on lease terms and promote use of a new set of comprehensive HoT to make legal drafting more efficient.
Leases should allow tenants to assign whole of premises with Landlord consent which is not unreasonably withheld
Requirement for AGA should be clearly stated.
Leases should allow tenants to sublet whole/part if appropriate without security of tenure w/ Landlords consent
Landlord and Tenant Act 1995
Assignment of leases
Abolished privity of contract for new leases
Gave landlords more scope for setting conditions regarding approval of assignee.
Introduced Authorised Guarantee Agreements
RICS License for altering guidance note 2013
- Advice to surveyors dealing with applicants from tenants.
- Importance of acting without delay and ensure license protects both parties.
- License must be clearly document works agreed.
Actions taken:
* Read lease
* Plans + spec
* Surveyor + legal costs
* Document alterations
* Check long term impact of property
* Consider reinstatement costs
* Planning required?
* Check equality act 2010
* Provide report to client and obtain instructions
* Instruct clients lawyers to prepare license for alterations
* Inspect completed works as agreed.
1954 act: Lease renewals outside the act – contracting out
When a lease comes to an end the tenant has no statutory right to remain or seek compensation for leaving.
Landlord must ensure premises vacant at end of lease.
To contract outside the lease landlord required to serve notice on prospective tenant warning proposed lease will not be protected prospective tenant declares response procedure must complete before lease
Consumer Protection Regulations 2008
Under the Unfair Trading Regulations 2008. Unlimited fine, prohibition order and prison (2 years max). So it is a criminal offence.
* Extends agents’ duty of care beyond clients to all interested parties – principle based
* Broad – unfair business to consumer commercial practices
* Introduce the concept of the average consumer, who is reasonably well informed
* The concept of material information. Information which would mislead the average consumer in their decision making
* Blacklists 31 practices
* Letting and sales
* Unlimited fine / prohibition order / up to 2 years in prison
* Max fine of £25,000 to complainant or prohibition order
Misrepresentation Act 1967
- Relates to misrepresentations or a false statement of fact made by a party during pre-contractual enquiries made by the vendor or their agent to the potential purchaser
- The vendor/and or agent can be sued for damages and/or the contract can be rescinded
- Civil offence, not criminal, so actional by tort
- Agent has the duty of care to check that the advice, information or opinion is reliable
- Exclusions/disclaimer may be effective in protecting the vendor and their agent if fair and reasonable
Money Laundering, Terrorist Financing and Transfer of Funds Regulations, 2017
Main area of offence: Tipping off, Assisting and failing to report.
* Firm’s must have a Money Laundering Reporting Officer (MLRO) – must register with HMRC
* Policed by National Crime Agency.
Key requirements include;
* Conduct written money laundering and terrorist financing risk assessment
* Implement systems, policies and controls
* Provide staff training
* Comply with the level of due diligence, including for Politically Exposed Persons (PEP)
* Record keeping
* The vendor’s agent needs to identify the purchaser of a property and check the source of funds
Money Laundering, Terrorist Financing and Transfer of Funds Regulations, 2017
Levels of Due Diligence;
1. Customer Due Diligence (CDD):
* Identify client and verify identity based on reliable sources (passport)
* Make reasonable endeavours to identify the beneficial owners
* For companies – their name, company number and address, directors’ names
* Purpose of purchase and nature of the business relationship and proposed funding arrangements
2. Enhanced Due Diligence (EDD):
* Additional procedures are required for any transaction or business relationship involving a high-risk country or politically exposed person PEP)
* Requires additional evidence and monitoring – to trace the source of funds
* PEP described someone who has been entrusted with a prominent public function
* Higher risk by virtue for potential involvement with bribery and corruption
* More detailed explanation of the background and purpose of the transaction and more monitoring
Money Laundering, Terrorist Financing and Transfer of Funds Regulations, 2017
Other requirements;
* Limit of 10,000 Euros for acceptance in cash
* Existing clients still need to be monitored
* RICS issue a list of red flags
* Need to maintain records for a minimum of 5 years
Penalties;
* Max 14 years prison sentence for assisting
* Max 5 years for tipping off
Estate Agency Act 1979
Application – Land, Freehold and leasehold property (with capital value), but not new leases, although it is considered best practice.
Key Principles of the Act;
T – clarity on Terms of engagement – Sec 18 need to specify all costs
H – Honesty and Accuracy
I – Openness for Personal Interest – Sec 21 if its more than two times removed, then no conflict
D – Absence of Discrimination
O – Tell client all Offers
C – Agreement and liability for Costs
C – Keep Clients money separate
