Conflict of interest using same legal firm for both vendor and purchaser

Heres_the_deal

For various reasons, when we instructed our solicitor nearly a month ago, we were aware the same legal firm (different office, different conveyancer) would be working for both vendor and purchaser. However, the 'full' pitfalls were not pointed out to us until a few days ago when we were asked to sign a letter confirming our decision. In the letter, various examples of conflicts are highlighted, one of which is they are unable to renegotiate price on outcome of negative survey / valuation.

This, we may have to do as the lenders valuation came back lower, and the survey is yet to be carried out. In which case we would have to instruct another solicitor to renegotiate the price (not an option for us). It 'appears' the solicitor may not have started the conveyancing process until a few days back, hence why this letter has only just been raised. Had we been informed of these issues at this level of detail at the point of instruction, then we would not have gone down this route.

So, my questions are:

As we were not made aware of any pitfalls until a month after instructing the solicitor. If we do not sign the letter confirming we are aware of any potential conflicts, can they charge us for work done to date?

Could we remain on track using the same solicitor, but 'we' renegotiate the price with the EA  (it would be a simple case of drop by x%, or we pull out)?

davidmcn

I doubt they can legitimately charge you for work done before they pointed out the potential conflict, though it sounds it would be minimal anyway. In any event, you're better off using a different firm, you don't know what else will come up later in the process (and the real risk is that the solicitors decide it's easier to smooth over potential problems rather than go through the hassle of pointing them out to you).

No idea why this is allowed in England/Wales (assuming that's where you are), the rules are much tighter in Scotland.

AdrianC

The fact you're using the same firm should be irrelevant, because there should be chinese walls within the firm.

The "won't renegotiate" may simply be the vendor saying that to their solicitor. The solicitors (and the EA) don't do the negotiation themselves - they are simply the mouthpieces of the two parties, buyer and vendor. If one party refuses to renegotiate, then it doesn't matter who is involved in the discussion between the two.

eddddy

Also, just to add, solicitors don't generally get involved in renegotiating price.  You would typically negotiate via the EA and tell your solicitor the outcome of the negotiations.

theartfullodger

Fire solicitor and engage an independent firm

iwb100

I mean you wouldn't normally expect your solicitor to negotiate a price - do it via your EA. So I don't think that's an issue. But as has been pointed out already, what if something comes up during the process that requires negotiation - for example some form of indemnity policy - you need to know your solicitor is working for your best interests - and whilst having two solicitors at same firm IS allowed in this instance - will you have a nagging doubt should some cost be thrown up and you are asked to cover it.....or whether you've been properly advised generally. 

I think it comes down to your own judge of personal risk. 

davidmcn

AdrianC said:

The fact you're using the same firm should be irrelevant, because there should be chinese walls within the firm.

Chinese walls (or "information barriers" as we now try to call them...) are more to do with confidentiality, and don't avoid the risk of potential conflicts - but even with those I would say acting for both parties is only appropriate for the more "sophisticated" clients who would fully understand the risks, and if there's actually a good reason for the firm being on both sides (e.g. because both clients were already established clients of the firm).

Heres_the_deal

I appreciate these are difficult questions to answer/advise on when the background of my situation is not known, hence the best I could come up with is 'For various reasons'. This sale has been fraught with complications from day one. Its a simple purchase, no chain with vacant possession that should have taken around 8-12 weeks.

We've already deinstructed one legal firm and put in a complaint as they did nothing for over six weeks, not even an ID check. Now, we're months in and achieved very little. I don't have the time or money left to change solicitors, so my options are limited: Pull out completely and postpone buying for another six months, or carry on with this sale and if a negative survey arises renegotiate with the EA direct (then walk away if nothing is agreed).

steampowered

You could point out to your solicitor that you are not happy with the issues identified in their letter, and will therefore require independent representation. Ask them to confirm whether they would charge in the circumstances.

Solicitors aren't involved in negotiating the price. They will simply document the price they are told by their clients. So that isn't an issue, and you might be fine if it is a straightforward purchase, but as davidmcn said the real risk is if something unexpected comes up you want someone on your side.

eddddy

Heres_the_deal said:

carry on with this sale and if a negative survey arises renegotiate with the EA direct (then walk away if nothing is agreed).

As explained above, price renegotiation is completely irrelevant - solicitors don't do that - don't use that as a consideration in your decision.

But, for example, is the process taking a long time because of differing legal opinions between solicitors? If so, maybe you should use a completely independent solicitor who might fight your corner a little harder.

greatcrested

I would never use the same firm as my 'opponant' Strong word, but this is a legal arrangement between two parties each protecting their own interests.

You want the solicitor acting for you to be completely independant of /unconnected with the solicitor acting for the other side.