Solicitor won’t write letter of undertaking.

rose_T

Last I heard on Monday ( may have changed now ) our sellers solicitor doesn’t want to write a letter of undertaking to remove an old charge on the house, this charge is only 10k and is 38yrs old. I fully believe the sellers when they say it’s fully paid off but was never discharged by their late parents after final payment. He offered title indemnity insurance instead but this is not acceptable to our lender. 

We have told the sellers that our lender has refused the insurance and they are wanting 1st ranking security on property, so they will need to ask their solicitor to provide a letter of undertaking to remove the charge before our lender is happy. 

My solicitor has said that he should be doing this as it falls under his roles of conveying. But so far he is reluctant. It’s a TSB security so isn’t like a old building society that’s no longer around. She says all it takes for him is a few letters to track the account down and it would be discharged, she has even offered to give him 3yrs to do this and our lender will be happy and the sale can go through. She says she deals with this all the time and if it was the other way round her firm would be happy to supply the undertaking. 

This post is more of a vent than anything but any thoughts would be great 

GDB2222

I, too, wouldn't provide an undertaking for something outside my control.

user1977

rose_T said:

She says she deals with this all the time and if it was the other way round her firm would be happy to supply the undertaking. 

Then she's an idiot. A solicitor cannot give an undertaking to discharge a security if nobody has yet figured out what the security is for. What if the TSB track it down and say there's a million pounds due? The solicitor would then have to pay that.

[Deleted User]

More thoughts than your other two threads on the same subject? 

https://forums.moneysavingexpert.com/discussion/6286196/feel-like-my-head-is-going-to-explode#latest

https://forums.moneysavingexpert.com/discussion/6284550/weird-one-anyone-come-across-this-before/p1

rose_T

user1977 said:

rose_T said:

She says she deals with this all the time and if it was the other way round her firm would be happy to supply the undertaking. 

Then she's an idiot. A solicitor cannot give an undertaking to discharge a security if nobody has yet figured out what the security is for. What if the TSB track it down and say there's a million pounds due? The solicitor would then have to pay that.

We do know what it was for and so does the sellers and their solicitor,  it was the original mortgage that the sellers parents took out to purchase the house. It quite clearly states on the search sheet how much the security was for and the date it started. So doubt that he doesn’t know what it’s for and definitely not million pounds! 

user1977

rose_T said:

user1977 said:

rose_T said:

She says she deals with this all the time and if it was the other way round her firm would be happy to supply the undertaking. 

Then she's an idiot. A solicitor cannot give an undertaking to discharge a security if nobody has yet figured out what the security is for. What if the TSB track it down and say there's a million pounds due? The solicitor would then have to pay that.

We do know what it was for and so does the sellers and their solicitor,  it was the original mortgage that the sellers parents took out to purchase the house. It quite clearly states on the search sheet how much the security was for and the date it started.

That doesn't prevent the lender from later using it as security for something else though.

TBG01

She says she deals with this all the time and if it was the other way round her firm would be happy to supply the undertaking. 

Have her undertake to remove the charge if she's that comfortable with it.

TBagpuss

The difficulty is that a solicitor's undertaking is legally binding. If they undertake to remove the charge then they are responsible for doing so, whether or not their client provides them with the necessary funds to cover the cost s or to pay any charges which might turn out to be outstanding.

So I am not surprised that the solicitor is not willing to do it.  You may know how much the original charge was for but you can't know hoe much interest or other fees might have been added. If you are right and it was paid off then there shouldn't be anything to pay, but until TSB confirm that that is the case then no one knows for sure what if anything is owed. 

If all it takes is some letters to get it cleared off then that can be done before completion, or alternatively all the paperwork can be provided to do it at the same time as the transfer is completed and your mortgage registered. 

If your solicitor says she would give an undertaking then I am very surprised, and I imagine that her boss (if she is not the owenr of the company) and her professional indemnity insurers, would be surprised and concerned to hear it! 

GDB2222

TBagpuss said:

The difficulty is that a solicitor's undertaking is legally binding. If they undertake to remove the charge then they are responsible for doing so, whether or not their client provides them with the necessary funds to cover the cost s or to pay any charges which might turn out to be outstanding.

So I am not surprised that the solicitor is not willing to do it.  You may know how much the original charge was for but you can't know hoe much interest or other fees might have been added. If you are right and it was paid off then there shouldn't be anything to pay, but until TSB confirm that that is the case then no one knows for sure what if anything is owed. 

If all it takes is some letters to get it cleared off then that can be done before completion, or alternatively all the paperwork can be provided to do it at the same time as the transfer is completed and your mortgage registered. 

If your solicitor says she would give an undertaking then I am very surprised, and I imagine that her boss (if she is not the owenr of the company) and her professional indemnity insurers, would be surprised and concerned to hear it! 

Curiously, the Supreme Court ruled that many solicitors' undertakings are not enforceable at all. Many solicitors firms are now constituted as LLPs (rather than old fashioned partnerships), and undertakings from LLPs are not enforceable. 



"The Supreme Court has highlighted a legal loophole which means that, unlike individual solicitors, LLPs do not fall within a court’s power to enforce undertakings.

In Harcus Sinclair LLP v Your Lawyers Ltd handed down today, five Supreme Court justices consider whether a court’s inherent supervisory jurisdiction over solicitors – which allows it to enforce undertakings – should be extended to cover firms which have a separate legal personality. Undertakings are central to many areas of legal practice, particularly conveyancing.

The Supreme Court said the strongest argument in favour of extension is that ‘the court’s buttressing of professional undertakings within the provision of solicitor services ought fairly to be equally available across all types of provider’.

However, the judges concluded that it was not the right time to make such a decision. ‘We consider that a properly informed decision would much better be made with the assistance of submissions from the Law Society, and from any other professional or regulatory body with a legitimate interest,’ it said, adding that parliament should consider the issue.

‘In the meantime, we share the [CoA] judge’s concern about whether those dealing with incorporated law firms, and with solicitors’ LLPs in particular, are sufficiently aware that undertakings given by them are not currently buttressed by the court’s supervisory jurisdiction.’"


https://www.lawgazette.co.uk/news/supreme-court-warns-of-llp-lacuna-in-vw-claim-decision-/5109352.article

rose_T

I appreciate everyone’s thoughts on why the solicitor is taken a stance. 

But he is working for his clients who want to sell the house so why isn’t he taken any steps to have it removed? Forget about the undertaking, what other ways can he resolve this? 

My solicitor is obviously making sure we buy the house free from any other claims. 

This solicitor is from the same office our sellers have been with for over year, this same office took 9mths to get confirmation from the courts after which that solicitor passed the case over to the property solicitor which we have been dealing with for 3mths. 

So for a year they must have known there was no deeds to property there must have been someone that noticed there was a charge registered to property? They would have had to go through everything to provide the court so they could get confirmation ( probate) 

user1977

I think we've already gone over that on one of your previous threads. The commissary court doesn't care about any securities over the property (though the executors should be checking whether there are actually any debts due by the estate, and if they've found a surprise security then they ought to be following that up).

But whatever has previously happened, the current problem is that the bank is being slow to justify why they shouldn't discharge the security.