Limited Title Guarantee - Executors Selling Property

Terrysdelight

Hi

Son is looking at buying a flat, his solicitor is on holiday for a few days so he can't get advice at the moment. I've had a look at the legal pack and there is nothing obvious pinging out at me. The property is being sold be executors, there aren't any charges outstanding, it's a purpose build flat which is sound - length of lease is fine. No problems with planning or water works. But there is this special clause and we don't know if there are any risks or if this is standard.

Should my son by pass this one and keep looking?

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The Transfer to the Buyer shall contain the following provisions:-

This Transfer is made with limited title guarantee but the covenants implied by the Law of Property (Miscellaneous Provisions) Act 1994 Section 3 (3) should be modified by the substitution of the words ‘since the death of xxxxx xxxxxxx on 1 December 2009’ for the words ‘since the last disposition for value’ on the second occasion upon which those words appear in Section 3 (3).

This Transfer is made with limited title guarantee but the Transferor shall not be liable under any of the provisions contained in the Law of Property (Miscellaneous Provisions) Act 1994 Sections 3 or 4 for the consequences of any breach of the terms of the registered lease concerning the state and condition of the property.

Many thanks
Terri

sonastin

Not completely familiar with the legalese so I'm sure someone else will come along shortly to help out...

but I think it is just because the vendors have never actually "owned" the property so they are only willing to guarantee title to it in as much as they believe the deceased person had good title. I'm buying a reposession and the vendors of that aren't willing to give a title guarantee either. My sol said it would be nice to have but you never get it on a repo. I can imagine a probate sale is a similar proposition.

Terrysdelight

Thanks for that. We are thinking along those lines too. Son really likes this flat and it's near mum. Solicitor is back Friday, so it's plenty of time before auction.

Thanks again.

Richard_Webster

If the title is registered then it will be clear whether there are any problems with it. The lease itself needs to be looked at in detail.

There should be sticky on this as the point comes up about once a month on this forum. Without going into a lot of detail the general rule is Caveat Emptor - let the buyer beware and it is up to the buyer to check stuff. The things being guaranteed are pretty obscure and noy usually worth worrying about.

Title guarantee sounds really important but is greatly overrated in most situations. The law got changed in 1994 and before then contracts did not mention any title guarantee at all but in this case simply would have said that the seller sold as personal representative and nobody would have worried in the slightest about it. The Law Commission had the clever idea of changing things and so we end up with these questions.

The areas where any guarantee is given at all are really very limited for most circumstances so the kind of guarantee given matters very little in the real world.

You would have much more to worry about if the solicitor pointed out that e.g the lease had only 58 years left so was effectively unmortgageable and that was why it was being auctioned!

Terrysdelight

Richard_Webster wrote: »

If the title is registered then it will be clear whether there are any problems with it. The lease itself needs to be looked at in detail.

There should be sticky on this as the point comes up about once a month on this forum. Without going into a lot of detail the general rule is Caveat Emptor - let the buyer beware and it is up to the buyer to check stuff. The things being guaranteed are pretty obscure and noy usually worth worrying about.

Title guarantee sounds really important but is greatly overrated in most situations. The law got changed in 1994 and before then contracts did not mention any title guarantee at all but in this case simply would have said that the seller sold as personal representative and nobody would have worried in the slightest about it. The Law Commission had the clever idea of changing things and so we end up with these questions.

The areas where any guarantee is given at all are really very limited for most circumstances so the kind of guarantee given matters very little in the real world.

You would have much more to worry about if the solicitor pointed out that e.g the lease had only 58 years left so was effectively unmortgageable and that was why it was being auctioned!

Thanks Richard. You oviously know your stuff.

I've picked up on something in the legals which I don't like the look of so I think I will steer my son away from it. Basically the maintenance company - it appears an incredible rip of. Will post a new question on it and hopefully get some feedback. Thanks again Richard.