Land Registry and former Management Company issue-solicitor refusing to proceed

samrwill

In a bit of a pickle here and not sure how to proceed.

The situation is this -
Received an offer on my house around end of April time, we were hoping to move out by end of June but here we are.

The issue seems to be the buyers solicitor, but I don't know the full story as everything I hear is third hand - I do know they've been appallingly slow and I was ready to exchange contracts about a month ago.

Here is the story -
The small estate I live on had a Management Company set up soon after the estate was complete in 2003, for the residents to maintain the green areas and the pump station.  The residents appointed directors etc.  Fast forward to a few years ago when the Parish council implemented their £1 option to take over the green space and Anglian Water were obliged to take over responsibility for the pump maintenance.  As there was no longer any need for the Management Company, it was dissolved in 2017.

Apparently this is a major hiccup for the buyers solicitor who are refusing to proceed with the purchase because of a restriction on the title relating to the Management Company.  They are insisting that the restriction be removed completely or the MC reinstated.

Other properties on the small estate have been sold where the purchasers have signed a deed of covenant so the restriction can be disapplied.  My understanding is that in 2023 it can be removed entirely because the time by which the MC can be reinstated will have run out.

Obviously other properties on the estate have changed hands since 2017 without issue.

I am at a loss as to why they won't proceed with the deed of covenant option and am hoping someone can explain this to me.

The other issue now is that our buyer will need to reappoint another solicitor as the current ones are basically disinstructing themselves due to this - what sort of delay are we now looking at, and is this going to be a problem issue for selling the house?  The estate agent seems to think it might be an issue as their case becomes 'high risk'.

Thanks for any advice or clarification on this....


Also this should probably be in the Land Registry thread, just spotted that one so if it can be moved I'd be grateful

eddddy

samrwill said:

I am at a loss as to why they won't proceed with the deed of covenant option and am hoping someone can explain this to me.

What does your solicitor say about the situation? Does he/she agree that this is a big problem?


It might be worth investigating whether the reason is something like this...

• Your buyer may have chosen a "conveyancing factory" to do the conveyancing. They might only do completely standard transactions - they don't have the processes, skills or experience to do anything 'non-standard'.

• The estate agent might have referred your buyer to this conveyancing solicitors - because these solicitors pay a large referral fee, and not because they're good solicitors.

• The estate agent is making excuses about "high risk" - because they don't want to admit that "they referred the  buyer to a rubbish firm in order to get a big referral fee".

If that's the case, the solution might be to urge the buyer to use a more 'traditional' conveyancing solicitor, who is happy to deal with Deeds of Covenant etc.

samrwill

Hi there and thanks for the reply, sadly we don't know where the buyer found the solicitor/conveyancer, very possibly from their estate agent and from the snippets of information I have received it seems like they're constantly having to 'refer to a senior partner' so as you say, likely a conveyancing factory type thing or a trainee - he apparently mentioned he'd never come across anything like this before.

My solicitor is bemused, my estate agent is raging at the ineptitude.

I'm a bit more concerned about what the delay is now likely to be as and if it's a problem changing solicitor mid purchase? I know my solicitor did send out a deed of covenant to them already so hopefully if the paperwork is otherwise sorted things ought to carry on without further issue?

Land_Registry

Such things can happen but you seem to appreciate what the options are to enable matters to proceed. PG 19 explains how restrictions are set so you can comply with them or seek disapplication as mentioned. There’s also cancellation and withdrawal but they don’t apply here it seems

https://www.gov.uk/government/publications/notices-restrictions-and-the-protection-of-third-party-interests-in-the-register
Why won’t the solicitir/conveyancer proceed? Only they can really answer but one possibility is that the mortgage product the buyer has won’t go through due to restriction and management company issue. Hopefully they can explain and resolve 

samrwill

Thanks for replying here.
The person managing the case is a conveyancing executive rather than a solicitor who perhaps is less experienced in these types of situations, they appear to have said that either we comply with their options or they are no longer able to act for the buyers, no mention of the lender stipulating conditions.  I would have hoped that if the lender was the issue, we'd have been advised about this earlier on in the process.
I haven't heard anything this week so I'm hoping that the buyers are looking for some way to proceed with this, it's extremely frustrating.

samrwill

@Land_Registry Apparently the buyer's conveyancer has now backtracked from his original position, but both the buyers and he are adamant that this is something my solicitor needs to apply for not them, is this actually the case? 

My understanding is that as the new owners of the property, they need the disapplication going forward as the new owners, so they need to sign the deed of covenant to have it disapplied, which would come from their conveyancer even though mine has sent it to them?

The in's and outs of this are getting a bit complicated - does it matter who applies?  It's basically a small fee and a form?

Land_Registry

samrwill said:

@Land_Registry Apparently the buyer's conveyancer has now backtracked from his original position, but both the buyers and he are adamant that this is something my solicitor needs to apply for not them, is this actually the case? 

My understanding is that as the new owners of the property, they need the disapplication going forward as the new owners, so they need to sign the deed of covenant to have it disapplied, which would come from their conveyancer even though mine has sent it to them?

The in's and outs of this are getting a bit complicated - does it matter who applies?  It's basically a small fee and a form?

The proprietor would apply normally as stated in the guidance 
https://www.gov.uk/government/publications/corporate-insolvency/practice-guide-35-corporate-insolvency#disapplication-or-modification-of-the-restriction

samrwill

Aaaargh... thank you...it seems they are waiting for the buyers to sign the deed of covenant before they can submit this. 

So the issue is still with the buyer's conveyancer it seems.