Conveyancing error has messed everything up

jmillner

Hi,

We are in the middle of a three-party property chain and up until last week it looked like we were virtually ready to sign and exchange contracts. However last week I received an email from my solicitor about something and in that email he mentioned that when he handled the purchase of our present home just over ten years ago he had failed to register the title to the leasehold garage when we purchased our current (freehold) property. He is saying that in order to rectify the situation its necessary for a new Lease to be prepared and to be signed by the current leaseholder to whom the builder (we bought a new build) transferred various parcels of land on the estate. The Lease will also have to be signed by First Port. I called him straight away and he has told me that this could drag on and on until it gets sorted. He said there is a chance that the land registry might be prepared to register the lease under the original freeholder (the builder) but even if the land registry agree to this (and there is every chance they wont) then he still thinks that we will still be looking at the very end of March/ early April!!

This delay presents us with a massive issue for several reasons. Firstly we could lose the house we are purchasing if our (chain-free) seller finds out and decides to re-market their property. Secondly our buyer is a buy-to-let investor who was banking on the sale going through before the new stamp duty rules are introduced. He has been made aware of the situation and has confirmed that he still wants to buy the property. The solicitor offered him the option to arrange a retention but he (quite understandably) does not want to do this. He has also said that he would expect us to pay for the stamp duty if the transaction completes after new stamp duty rules have been implemented. We would not be prepared to do this because I don't see why we should when it was due to a mistake that was not of our doing. Equally I can understand why our buyer would feel he shouldn't be financially penalised as a result. Our estate agent spoke to the buyer and mentioned the option for the retention but it was a bad line and it might be that he doesn't understand exactly what would be involved so perhaps some further clarification might change his mind (I'm probably clutching at straws I know).

So we are now at the point where our solicitor is going to approach both the land registry and the current freeholder of the garage. But either way it looks unlikely the transaction will go through on time and everything seems to have come to a standstill.

I just don't know what else to do. I know moving is supposed to be stressful but its so frustrating for it to all unravel at the very last minute. If this chain breaks apart I really don't have the will power to go through it all again straight away and there is absolutely nothing else in our price range that we are even remotely interested in.

I'm annoyed because although I have explained to our solicitor the implications of the delay he doesn't seem to be treating this with the urgency I was hoping for - he's going to make an initial contact with the land registry and not follow it up for another two weeks...

Is there any point in continuing with this or should we just call it a day and move on?

davidmcn

Have you clarified whether your purchaser would be prepared to proceed with the house only, with the garage to follow once you've sorted out title? You could at least offer them occupation of it in the meantime.

AdrianC

jmillner wrote: »

I'm annoyed because although I have explained to our solicitor the implications of the delay he doesn't seem to be treating this with the urgency I was hoping for - he's going to make an initial contact with the land registry and not follow it up for another two weeks...

I suspect that's not a lack of urgency on his part so much as recognition that chasing the LR every day won't actually make it move any faster.

Given that the house and garage are under separate titles, I really can't see any issue with continuing towards completion on the house with the understanding that the lease on the garage will follow shortly. Given that the SDLT change takes effect on 1st April, we're not talking about a large timescale, and your buyer has a strong incentive not to let this purchase collapse.

TBF, you didn't notice the error a decade ago, either...

G_M

If the Land Registry are advised that their processing of an application or amendment is holding up another transaction, they will expadite their work.

Either contact the LR (with full details of the application) yourself, or encourage your solicitor to do so.

Of course, that does not alter the speed with which the freeholder or other parties work, and it assumes that all the documents required by them have been sent to the LR for processing.

SmlSave

Go ahead with the sale of the house with the garage to follow, if your buyers have decent solicitors they will have done this before.

There is absolutely no point in your solicitor chasing the Land Registry weekly. They have huge delays at the moment with new build/ new leasehold properties - think months not weeks and while your solicitor can state it's urgent there's no guarantee the land registry can do it any quicker

Land_Registry

My reading of this is that at present there is no actual application with us or indeed being submitted as yet.

The solicitor is going to write to us to enquire whether we will register the original lease as granted by the then freeholder albeit the freehold is now owned by someone else, the 'current freeholder'.

IF there is a genuine properly executed lease from when the original purchase was completed there MAY be an opportunity to register it so long after time IF the current freeholder consents - as you will appreciate that is likely to depend hugely on whether the current freeholder knew that it was leased when they bought the freehold and of course their approach to the current situation.

If there are mortgage lenders involved then this may add to any complexity of course as they will need to be involved

I have emboldened the IFs and MAY as it is an outside chance after such a long period of time but clearly your solicitor is trying to solve the issue in the best/quickest way they can. The new lease may ultimately be the only option but always worth the enquiry

Your solicitor may of course be asking something quite different but the key for me, if I have understood correctly, is how the current freeholder views this - whether it's getting their consent to register an old lease or them to enter into a brand new lease you are dependent on them after all. And we may tale the view that until you submit an actual application we cannot say whether we will register the old lease anyway.

Please do post again so we can see how this plays out although I appreciate this must be very stressful for you. Hopefully a positive and speedy outcome can be found

And, yes we are experiencing delays on certain types of registrations inc new leases. Not all are subject to a lengthy delay though and the current average remains around the 40 working days mark. And yes if there is a linked transaction, such as an onward sale and the applicant provides such details we will consider expediting their application - although finishing it also relies on it being complete and registerable of course