Code For Completion Amendments Improve Buyer Protection

On Friday, last week, The Law Society published the latest version of the Code for Completion that will come into force on 1 May 2019.

The amendments to the Code for Completion have been made in response to the implications following the infamous Dreamvar case which exploded last summer.

The Court of Appeal upheld that the seller’s solicitor in the Dreamvar case was in breach of sale because the transaction implies that a genuine sale was taking place. As the seller was a fraudster, it made a genuine completion impossible.

The main changes to the Code for Completion emphasise that the seller’s solicitor is acting in a genuine sale.

The Law Society Code for Completion by Post, states: “In view of the decision in P&P Property Ltd v. Owen White & Catlin LLP and Dreamvar (UK) Ltd v. Mishcon de Reya (a firm) [2018] EWCA Civ 1082, paragraph 8(i) of this code constitutes an undertaking that the Seller’s Solicitor has authority from the true owner of the title to the property named in the contract to receive the purchase money, and that such person is at the point of completion entitled to convey such title as the contract states will be conferred. This case law is also reflected in the definition of “Seller” used throughout this code.”

It is hoped that nuanced changes like this will offer genuine buyers with increased protection from criminals with fraudulent intent.

In the past the Code for Completion has been optionally used to help complete the selling process. However, the new system will force more solicitors to use the code. Members of the Conveyancing Quality Scheme (CQS) will be obligated to use the Code in all conveyancing transactions when it comes into force in the summer.

Similarly, if any conveyancing firm has agreed to use Law Society Conveyancing Protocols, they will automatically use the Code.

For all other solicitors, the Code for Completion is optional. Where it is used, both buyer and seller’s solicitor must agree to use it.

Will this create more protection for the buyer?  

Do NOT follow this link or you will be banned from the site!
X