A 10 minute rule motion was read in Parliament today by the Conservative MP for Dudley North Marco Longhi, in which a proposal for a “Conveyancing Standards Bill” was formally discussed and passed its first reading without opposition.
The ten minute rule allows a backbench MP to make a case for a new Bill in a speech lasting up to ten minutes. An opposing speech may also be made, although on this occasion no opposition was offered.
The Bill would establish minimum standards regarding search and assessment of risks for solicitors and licensed conveyancers acting on behalf of purchasers of residential properties and for connected purposes.
Mr Longhi described how the current system:
“Has not kept pace with an industry that has become increasingly cut-throat. The system does not offer enough consumer protections for people who are about to make possibly the single most important investment of their lives”
Further describing the consumer experience as “mired in documents and legal complexities which are rarely fully understood.”
According to Mr Longhi, the aim would be to:
“Protect people who wish to buy a house, sometimes their first home, from being exposed to risks which are currently not sufficiently visible or understood when at the point of purchase.
“This bill does not propose radical changes to the conveyance process not indeed does it propose changes to the development control system although some may say this might be desirable to further de-risk the process for homebuyers.”
Presenting his case Mr Longhi identified two scenarios which he had come up against in his own Dudley North constituency.
A developer purchases land and applies for planning permission which is granted, subject to conditions.
One such condition is that soil sampling is taken to establish any contamination and amongst other, the properties are not to be occupied until planning permissions have been fully satisfied
The developer set up a limited company to market and sell properties on the development where properties were sold off plan and nearer completion. When the final plot was sold, the developer liquidated the company meaning that the company that sold the houses no longer existed.
As people moved in it became clear that a significant number of planning functions had not been complied with including drainage connection, soil sampling and road adoption.
Homeowners turned to the council for help but established that any regulatory liabilities regarding the property transferred to the owners at point of sale. If the council chose to enforce breaches of planning it would have to pursue the new homeowners.
Mr Longhi pointed out that the current system places no requirement on planning authorities to pursue developers to evidence compliance with planning conditions.
In a second scenario Mr Longhi highlighted purchases where there may be a contract for the maintenance of green spaces on the estate, grass cutting, hedge trimming etc.
What is not discussed with sufficient clarity is that the small print advices that the contract owner can increase the price arbitrarily with no recourse for residents against poor workmanship or lack of clarity.
These areas remain unadopted by local council and even if a homeowner refuses to pay, the charge is registered against the property so it cannot be sold without payment.
Summing up, Mr Longhi highlighted that the lack of clarity and understanding placed a greater emphasis on solicitors and licensed conveyancers to make the information clearer to home purchasers.
An unopposed 10 Minute Rule is said to have passed its first reading. The second reading is scheduled for the 27 November 2020.
