Introduction
It is probably fair to say that most conveyancing transactions in England & Wales these days use the Protocol – ostensibly at least. It is compulsory for those solicitor firms accredited to the Law Society’s Conveyancing Quality Scheme and is often adopted voluntarily by licenced conveyancers and non-CQS firms. However, looking at a couple of files today made me wonder what the point of it all was. Is it really the case that conveyancers acting for developers (who never seem adopt the Protocol) are not providing ‘quality’ conveyancing to their clients?
An ex-colleague of mine was fond of saying that the Protocol was just another example of ‘conveyancing by numbers’ whereby fee earners were unable to think for themselves but had to follow a detailed list of ‘dos and don’ts’.
Be that as it may, there seems to be an increase in the situations where conveyancers say that they are adopting the Protocol and then seem to adopt only those bits that suit them!
Following/Ignoring the Protocol
One common situation is where ‘extra’ non-CQS approved Special Conditions are inserted in the draft contract. The Protocol is clear:
“Note: The addition of further clauses to the contract is discouraged. Further clauses should not be included unless they are necessary to accord with current law, or specific and informed instructions have been given by the seller that inclusion of such clauses is necessary and they are required for the purposes of the particular transaction.”
Quite what this all means I am not at all sure. When can a clause be ‘necessary’ but NOT required for the purposes of a transaction? And what is actually meant by ‘necessary to accord with current law’?
One contract (for a perfectly normal house sale) included no fewer than 8 extra Special Conditions. Some of them, to be fair, were merely repeating existing Standard Conditions. So we had a term that if a completion notice was served and the buyer had paid less than a 10% deposit then it was to be made up to the full 10% and another one requiring the Buyer to enter into an indemnity covenant if the seller was to remain liable on covenants after the sale. So no harm there – and indeed I well remember being told that it was good drafting practice to include important provisions in the Special Conditions rather than leaving them with the mass of other provisions in the small print of the Standard Conditions which are often not printed out with the contract being signed by the client. But are these really that important?
And then of course we had the usual ‘William Sindall Clause’ – In the light of the decision in William Sindall plc -v- Cambridge County Council (1994) 3 All ER 932, it is agreed and declared that that the reply to any enquiry or information supplied in any property information form is given to the best knowledge, information and belief of the Seller, and that neither the Seller nor his legal representative has made any further enquiries into such matters (such as, but without limitation – conducting a site inspection or making specific enquiries of statutory authorities or utilities), and the replies are therefore given on that basis.
What is so wrong in attempting to protect your seller client by including such a clause? The basic rule of conveyancing is ‘caveat emptor’ and this clause has been upheld as being perfectly reasonable by the courts, so why shouldn’t we include it to protect our clients? Isn’t it necessary to accord with current law? One very experienced conveyancer, who uses this clause, told me recently that he regularly gets asked by buyers’ conveyancers to prove that he has got his client’s express instructions to include this clause! Do they not realise that the Protocol clearly states: ‘The obligation to act in the best interests of the client takes precedence over this Protocol.’
Another favourite clause is the provision about the defaulting party having to pay a fixed sum of money (e.g. £100) if the other party serves a completion notice because of a delay in completion. Assuming that this right applies to a default by both parties and the sum involved is not unreasonable, what is so bad about this? Having recently in my own house move having to face a situation where the buyer’s money did not arrive until 4.00pm on the day of completion, I know only too well the extra work imposed on conveyancers where there is a delay in completion. Why shouldn’t the extra work be paid for by the defaulter rather the innocent party being billed by his/her conveyancers – or more likely that party’s conveyancers doing the extra work for no extra fee?
One area where the Protocol is more specific is with regard to updating the Register but with which very few conveyancers seem to comply. So we have:
Note: At the time of submitting the contract bundle:
- entries in the register of title should be less than six months old; and
- if any information needs to be updated (e.g. change of name, the death of proprietor) the register should be rectified.
In such a case is it really that important to remove the name of a deceased joint tenant etc when Land Registry will accept the relevant certificates from the buyer on his/her application for registration anyway? What does it actually achieve?
One area of the Protocol that is of current interest is Step 2 which (inter alia) provides that the Seller should:
‘Carry out and record:
- verification of identity and compliance with Money
Laundering Regulations;
What does ‘verify’ mean? Many people (including the writer) think that this means the seller should ensure not just that the client is ‘a’ Mrs Smith, but is indeed ‘the’ Mrs Smith who is the proprietor of the property. If the Law Society were to make a statement one way or the other on this, it would resolve much of the uncertainty arising from the Mischcon de Reya Case (Dreamvar (UK) Ltd v Mishcon de Reya [2016] EWHC 3316 (Ch). Now that would be a useful thing for the Protocol to do!
