Deed of covenant

Kitten_Pie

Hi all,

I am after other opinions. We sold two flats and bought a house almost two weeks ago (completion) got all the remaining funds from our solicitor and I even called to check that the remaining money was ours and that they had taken their money etc so we could budget with what we had left.

On Saturday we had a letter asking for £150+vat for a deed of covenant for one of the flats. Surely if we were meant to pay this we would have been told earlier. We also agreed to a £250 retention so if we need to pay it could it not come from here.

If we have to pay it we will of course pay it just seems odd, I am now worried there will be other costs that come out and our budget for the work we have to do on the house is getting smaller and smaller.

TBagpuss

Who was the letter from? Have you spoken to your solicitor to ask why this was not spotted earlier? Was it one of the reasons for the £250 retention?

Kitten_Pie

We weren't given any reasons for the £250 just they wanted a retention so we agreed to it. The letter was from our solicitors firm. Oh has sent an email asking why this is being asked for now etc just wanted an idea or what others thought

eddddy

Hi kitten_pie

The deed of covenant could well be to bind the buyer to the terms of the lease (agreeing to pay management fees etc).

If so, your solicitors probably should have included this fee in their initial quote, and included it in their final bill. (Do they suggest it was left off the bill in error?)

The £250 retention is probably in case there were unexpectedly high management costs incurred, whilst you owned the flat.

So the two things are unrelated - so you can't really offset the £150 + vat against the £250.

But you could write to the solicitor and ask them to confirm that no further fees will be claimed after this one. (Although I expect they will give you a non-definitive answer like "we are not aware of any further fees".)

Kitten_Pie

Thank you. They haven't said anything about leaving it off in error just you need to pay this ring this number to do so over the phone etc.

At least we know where we stand and hopefully this will be the last thing connecting us to these dreadful places

eddddy

Kitten_Pie wrote: »

...
At least we know where we stand and hopefully this will be the last thing connecting us to these dreadful places

... except, hopefully you will get a cheque for £250 as your returned retention money - once 6 months has elapsed. (As long as no excess management charges were incurred.)

G_M

Do you know what the Deed is for? Have you asked?

If it is a Deed you requested, then yes, you need to pay for it.

If it is a Deed required by the conveyancing (as edddy suggests) then again - this is a 'disbursement'. An unavoidable cost which the solicitor must pay on your behalf.

Ideally it should have been included in the solicitor's final account to you, but sometimes

a) additional costs arise later or
b) yes, even solicitors accounts depts make mistakes! They overlooked it.

Either way, it is a fee you need to pay.

Of course, if it is an unecessary deed, don't pay for it!