Starting a Conveyancing Transaction (Stages 1&2) Flashcards
(12 cards)
What is a Memorandum of Sale?
IN RESIDENTIAL CONVEYANCES: It is sent out by the estate agent to all parties detailing the property, the price agreed, and the solicitors being used by each party.
Commercial counterpart: Heads of terms
What is a Mandatory Energy Performance Certificate (“EPC”)?
Contains information about the property’s energy use and typical energy costs:
- Graded from A to G
- Valid for 10 years
- Provided by seller
When is an EPC not required?
- Listed buildings
- If previous certificate is still valid
What are the Heads of Terms?
IN COMMERCIAL CONVEYANCES: Agreed terms between a commercial L and prospective T.
Residential counterpart: Memorandum of Sale.
What is the Code for Leasing Business Premises?
Sets out best practices for landlords when negotiating the terms of a commercial lease with a tenant.
What is the difference between a landlord’s rights against assignment of a lease in a residential v commercial contract?
Residential: Prohibitions against assignments are unacceptable
Commercial: L must consent to the incoming tenant + may also ask for extra security (e.g., rent deposits, authorised guarantee agreement)
What is an Authorised Guarantee Agreement?
A requirement that an outgoing T enters a written obligation to act as guarantor for their immediate successor in title.
What will the seller’ solicitor do, before sale of the property, if they find out that the seller has a mortgage on the property?
Ask the lender for an indicative redemption figure, to ensure proceeds from the sale of the property will cover it.
What is the seller under a duty to disclose?
MUST DISCLOSE:
- Latent Defects or Burdens (i.e., not apparent from inspection)
- NOTE: This does not apply to “physical defects” such as rotted timbers in the walls (caveat emptor)
DOES NOT NEED TO DISCLOSE:
- Patent Defects (i.e., discoverable upon inspection)
- But, if buyer tries to cover up a defect, this is wilful deceit and S can sue B in tort.
What happens if a seller does not disclose a latent defect/burden to the buyer?
Buyer can withdraw from the contract AFTER exchange of contracts + claim damage for losses
Why should the buyer’s solicitor have the buyer carry out a survey of the property, if the seller is under a duty to disclose?
Caveat Emptor: Buyer Beware
Seller has no duty to disclose latent, PHYSICAL defects.
What does the Contract Package contain in LEASEHOLD transactions?
