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Dates and topics for the Blundell Lectures 2014 27 March 2014

The dates and topics for the 39th series of the Blundell Lectures have just been announced.

All lectures take place from 6 pm to 8 pm at the Royal College of Surgeons, Lincoln’s Inn Fields, London WC2A 3PE.

Tickets cost £65 + VAT for each lecture (or £234 + VAT for all four Lectures) including e-documentation, drinks and canapés.

Click here for the ticket application form.

Monday 9 June 2014

OVERAGE – MAKING IT STICK
Joanne Wicks QC and Marie Scott, Nabarro LLP

How can a seller best ensure that he can claim a share in the increase in value of the land from a buyer and his successors in title?  Joanne Wicks QC and Marie Scott consider the pros and cons of the various devices used to achieve that goal, and how a seller may enforce, or buyer or his successor may seek to escape from, an overage liability.

Monday 16 June 2014

RESTRICTIVE COVENANTS – THE CURRENT LANDSCAPE
Guy Fetherstonhaugh QC and Professor Elizabeth Cooke, Law Commission

The enforcement of restrictive covenants by and against successors in title to the original parties remains dependent not only on the particular wording employed, but also on an uncertain, historic and sometimes conflicting set of legal propositions.  What are the current issues?  Guy Fetherstonhaugh QC and Prof. Elizabeth Cooke survey the landscape.

Monday 23 June 2014

PLEASE RELEASE ME
Jonathan Karas QC and David Howarth, Reader in Private Law and Director of the MPhil in Public Policy, University of Cambridge

Damages are increasingly assessed on the basis of what is often called the “release fee” or “buy out” measure first used in Wrotham Park Estate Co v Parkside Homes, not only where damages are awarded in lieu of an injunction, but also at common law for breach of contract or trespass.  What is the underlying principle behind damages on this basis?  When is it appropriate to award them?  How are they to be assessed?  Jonathan Karas QC and David Howarth provide some answers.

Monday 30 June 2014

WHEN IS A HOUSE NOT A HOUSE?
Damian Greenish, Pemberton Greenish LLP and Stephanie Tozer, Falcon Chambers

The definition of “house” in s.2(1) of the Leasehold Reform Act 1967 has given rise to problems for many years. Many hoped that the decision of the Supreme Court in Hosebay Ltd v Day would settle the difficulties for good.  But has that happened?  Or are the problems just beginning?  What exactly is a house?  Damian Greenish, Solicitor, and Stephanie Tozer, Barrister, explain.

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Just seven days left to respond to solicitors’ CPD consultation 25 March 2014

There are just seven days left to respond to the SRA consultation on its proposals for reform of solicitors’ Continuing Professional Development (CPD) requirements.

It is vital that as many solicitors as possible respond, or ensure that their firm or organisation responds, for the reasons set out in this article.

The proposals

I summarised the SRA’s proposals in my article dated 7 February 2014 entitled “Consultation on ending CPD box-ticking requirements“.  Here is a short reminder.

Option 1 – a shift from procedural compliance to competence

The SRA’s favoured approach is “to remove the prescriptive requirement for solicitors to undertake CPD through specific regulations”.  It would instead be the responsibility of both entities and individuals to identity areas for development and ensure “appropriate development activity” is undertaken.  Non-mandatory guidance would be provided by the SRA.  “The guidance would not be prescriptive about the number of hours CPD to be undertaken, or about the type of CPD activity that solicitors should undertake.  It would focus on the outcomes to be achieved through development activity and on ways to implement the reflective cycle”.  This would “provide flexibility for entities and individuals to determine training and development according to their own needs.”

In short, to focus on the outcome of the training activity, not (as is the case now) on the activity itself. This fits in with the SRA’s emphasis on “outcome-focused regulation”.

Option 2 – regulations requiring solicitors to plan and reflect on their development

Option 2 would require solicitors to reflect on their practice, identify their training needs and plan, implement and evaluate their training on an annual basis.  This would differ from the first option in that it would specify, in regulations, a level of detail as to how CPD must be planned.

Option 3 – retain a minimum hours scheme with some modifications

Option 3 would look much more like the current system.  It would retain a minimum hours requirement (not necessarily 16 hours), but would allow a wider range of activities to count towards CPD, and “[recognise] the value of on-the-job training”.  The downside (as now) is that “there is a significant risk that [this] could encourage solicitors to focus on minimum compliance with the CPD requirement rather than on their competence and the relevant outcomes in the Code of Conduct.  For some solicitors the minimum hours would be too few while, for others, it might be too many.”

Roadshow at the Law Society

I was one of 30 or so people who attended a roadshow yesterday afternoon at the Law Society in Central London about the proposed changes (a disappointingly low number, but there was going to be a second roadshow in the evening and perhaps that was better attended).  All types of role and organisation (including training organisations) were represented, although there were very few typical fee-earning solicitors.  Presumably they were all too busy earning fees to concentrate on this type of exercise – even though they are the target of the changes.  Ironic really.

At the roadshow, representatives of the SRA summarised the three proposals, and the reason for the SRA’s preference for Option 1.  Then the floor was opened for comments – and there were lots of comments.

My impression at the end of the roadshow was that there were few (if any) supporters of Option 1 in the room, and similarly for Option 2.  In simple terms, this was (as was stated concisely by one of the participants) because “With Options 1 and 2 there will be far less training”.  Which is, of course, the opposite of what the new policy is meant to achieve.

Delving further, there seemed to be three different reasons for the meeting’s preference for Option 3 (ie as near the status quo as possible):

1. With Option 1, training would be seen as “nice to have” rather than as “compulsory”.  In many organisations (and particularly organisations that are not law firms, like industry and local authorities), the requirement for a minimum of 16 hours of CPD is the only lever that lawyers have to obtain a budget for training.  There is so much competition for funds in those organisations that “voluntary” training for lawyers (particularly lawyers who are already meant to be experts in their field) is likely to be seen as a luxury that cannot be afforded.  (This comment was made by at least half a dozen participants, including one former fee-earning lawyer, and might well have surprised the SRA representatives.  It certainly came as a shock to me.)

This might not be an issue with law firms, particularly the larger firms who need to be able to market their lawyers’ considerable expertise.  However, without a minimum CPD requirement, would time be put aside to allow lawyers to undertake training?

2.   Option 1 (and to a lesser extent Option 2) would require a considerable amount of management and administration within organisations in order to make them work effectively. Resources (in the form of administrators) would need to be found to establish what training each lawyer would need in order “to deliver competent legal services”, and then to ensure in some manner that that training is provided.  Admittedly, to some extent, that sort of training-needs analysis should already be being undertaken, and it can probably be accommodated within existing appraisal (PDR) systems – but it was pointed out (by me, actually) that even the best appraisal systems do not necessarily work in the real world in the way that they are meant to work on paper.  And in many cases there may be no appraisals.

3.  There was a widespread belief that the SRA would not be able effectively to police Options 1 and 2, and people would simply ignore the need for training.  The current system is effectively self-policing.  In the absence of fraud (ie people claiming to have undertaken more CPD than they had in fact undertaken), it’s very simple: no 16 hours CPD, no practising certificate.  The new proposals, on the other hand, are by their nature incapable of being policed objectively.  As one participant pointed out, by the time the SRA spots that someone has not been sufficiently trained (ie something has gone badly wrong within the firm), the damage has already been done, and the situation cannot be recovered.

There was also discussion about the timescale for any changes to be implemented.  The start of a new CPD year (1 November) would be a sensible time. The participants felt that the changes could not be introduced as early as November 2014 (particularly as the proposed new competency statement for solicitors, which would underpin any new system, is not yet even at consultation stage).  So November 2015 would be the earliest at which the change could be implemented.    Even that might be too soon, given the amount of work that would need doing in advance within organisations.

By the end of the roadshow, I was feeling slightly sorry for the SRA representatives.  They had drawn up proposals that – on paper at least – seemed to dovetail nicely with the focus on outcomes that underpins the current regulatory system, and that apparently would enable training, and the training spend, to be directed to where it is most needed.  But they (and, to be fair, I also) obviously did not anticipate the mood of the profession (or at least the segment of the profession present at the roadshow yesterday).   This must have been how the French Government felt, when it held a referendum in 2005 to approve the Treaty establishing a Constitution for Europe – and the French people said Non.

Please respond to the consultation

The SRA emphasised that there is a genuine consultation and, if there is sufficient resistance to its preferred option, it will have to think again.

My feeling is that the comments that were made in the room yesterday were pretty representative of what the profession would say generally – if people took the trouble to respond.

So it is important that as many people and organisations do respond.

The closing date is Wednesday 2 April 2014.  Details of how to respond are on this SRA website page.

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The future of the Land Registry (Part 2) 24 March 2014

This is an update to my blog article “The future of the Land Registry” published on 14 March 2014, and in particular the second section, entitled “Introduction of a Land Registry service delivery company”.  This considered the current consultation that proposes that the Land Registry (or part of it) should be turned into a “service delivery company”.

The Law Society responded to the consultation on 20 March 2014 and it has published its response on its website.  You can see it here.  It is a very detailed piece of work, and is well worth a read.  We should all be grateful to those people (I do not yet know who they are, but I intend to find out) who have spent so much time crafting the finished product.

The Law Society is unconvinced that the suggested changes would serve a useful purpose, to put it mildly.  Among its more trenchant comments are the following:

The consultation paper seems to suggest that the [proposed service delivery company] will automatically be more efficient than a trading fund [as currently exists].  The creation of an organisation at arm’s length from Government does not of itself mean that it will be more efficient and effective.  (para 20)

The full rationale for the splitting of functions has not been supplied. The paper states that BIS considers that the Land Registry would benefit from a separation of policy and delivery, but does not explain why [my emphasis].  Such separation could lead to overlap of functions, confusion, excess administration and cost, particularly in the short term. (para 21)

We assume that much investigation, research and analysis has been carried out in order to arrive at the options proposed but this work has not been set out in the consultation.  The Government needs to be more specific about the benefits for the public of the proposals, particularly in view of the inherent risks.  Many parts of the paper state that users “should see little or no change” as a result of the split but this of itself does not support the proposal for change.  Benefits for users and the public need to be elucidated [my emphasis again]. (para 16)

At first glance, some of this reads like a typical conservative (with a small ‘c’) “If it ain’t broke, don’t fix it” knee-jerk reaction.  But that would be to underestimate the amount of thought and research that has clearly gone into its preparation.

One of the key concerns that is expressed is that the concept of “efficiency” is not compatible with a definitive and independent land register.  Consider the following comments:

Part of the reason that customers have confidence in Land Registry is the quasi-judicial, independent and impartial manner in which decisions are made.  This engenders and maintains confidence.  If quasi-judicial decisions were to be made on commercial grounds – for example, because it is administratively easier to make a quick decision rather than perhaps the ‘correct’ decision – this could lead to more regular challenges to the Register.  Similarly, if operational considerations began to affect the registration – for example, if fewer notifications were sent out in circumstances where another may have a right to object in order to achieve targets and minimise costs, rights could be lost in the short term.  This could also lead to more challenges to the Register. (para 61)

Any increase in litigation, even if there is some, admittedly watered down, sort of state guarantee, could erode the integrity of, and confidence in, the Register.  This could lead to people not trusting what is on the face of the Register.  The Register and any data sets flowing from it would gradually lose usefulness once the integrity of the Register has become impaired. (para 62)

We are … concerned that other non-registration services, which have no statutory controls on prices, could become the most important part of the business to shareholders of any privatised entity.  This could result in resources being diverted to these parts of the business rather than being invested in core registration services. (para 14)

The concern is also raised that the Government is simply not up to the challenge of overseeing the activities of such a vital privatised service delivery company:

Serious concerns have been expressed about the operation of outsourcing or control of private sector companies by government, as is evidenced below.  (para 116)

The PAC report into Private contractors and public spending 2014 says:

“Government is clearly failing to manage performance across the board, and to achieve the best for citizens out of the contracts into which they have entered.  Government needs a far more professional and skilled approach to managing contracts and contractors, and contractors need to demonstrate the high standards of ethics expected in the conduct of public business, and be more transparent about their performance and costs. The public’s trust in outsourcing has been undermined recently by the poor performance of G4S in supplying security guards for the Olympics, Capita’s failure to deliver court translation services, issues with Atos’s work capability assessments, misreporting of out of hours GP services by Serco, and most recently, the astonishing news that G4S and Serco had overcharged for years on electronic tagging contracts: these high profile failures illustrate contractors’ failure to live up to standards expected and have exposed serious weaknesses in Government’s capability in negotiating and managing private contracts on behalf of the taxpayer.” (para 117)

The report went on to say:

“There is significant scope for government to improve its approach to contracting for public services.  The Cabinet Office told us that there is a long way to go before government has the right commercial and financial skills to manage contracts and it needs to use the full range of powers at its disposal.  For example, the Cabinet Office told us that only a third of contracts are on an open-book basis and, even then, departments rarely use the access provided and have a shortfall in the capability required to do so.” (para 118)

You will have got the drift by now.  I could not see anything in the Law Society’s response that could remotely be described as scaremongering.  I hope that the Government reads this document extremely carefully, and appreciates this comment in the penultimate paragraph (para 157):

Users of Land Registry are looking for a quality service, operated by knowledgeable staff, backed by the guarantee of the state with a Register that has integrity, can be relied upon, and is at minimal risk of fraud and corruption.  This is, on the whole, what is being delivered at present.

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Lease negotiations must result in tenancy at will 21 March 2014

I am relieved to report that the Court of Appeal has, at the third attempt, followed the prediction in my blog article of 12 February “Five important landlord and tenant appeal decisions awaited“.  Just two more to go now.  I am not aware that any Lords Justices of Appeal follow this blog, so it may conceivably just be coincidence.

Anyway, the case in question is Erimus Housing Ltd v Barclays Wealth Trustees (Jersey) Ltd [2014] EWCA Civ 303.  The transcript is on BAILII here.  Erimus occupied its principal office under a contracted-out lease.  On the expiry of the lease, things proceeded much as before.  In particular, the tenant continued to pay the rent.  There were occasional, but apparently not very serious, negotiations between landlord and tenant about the grant of a new lease, but it seemed that the landlord was happy not to grant a new lease as rents had fallen since the original lease had been granted, and the tenant was happy not to take a new lease as it did not know what its long-term plans were.  Ultimately the tenant served notice to leave, having signed up to take different premises.  The landlord claimed that an annual periodic tenancy had come into being, requiring the tenant to give six months’ notice ending at the end of a period of the tenancy.  The tenant claimed it had merely a tenancy at will and could simply walk away.

At first instance, the judge held that an annual periodic tenancy had come into being, in part on the supposition that if the landlord had served notice on the tenant, the tenant would successfully have been able to claim that it had the benefit of some type of arrangement that provided more security than a tenancy at will.  What is sauce for the goose is sauce for the gander. .

The Court of Appeal (and I) disagreed.  The established rule (as demonstrated in Javad v Aqil [1990] EWCA Civ 1) is that where parties are negotiating the terms of a new lease, the relationship is one of tenancy at will.  The fact that the tenant pays (or continues to pay) rent is not evidence that any more formal arrangement has come into existence.  And it is clear that the logic of the reasoning in Javad v Aqil applies however long the “subject to contract” negotiations take.  One cannot state that after, say, a year (or two years, or five years) some other legal relationship must have come into existence.

And that, I think, is all there is to say on the point.  The answer might of course be different if the former tenant stayed in occupation, paying rent, after negotiations had ceased.  But while they continue, the relationship is one of tenancy at will.

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The future of the Land Registry 14 March 2014

There have been two recent consultations about the Land Registry.  The first, Land Registry: Wider Powers and Local Land Charges, raised the possibility of giving the Land Registry further powers, and as an example considered the possibility of the Land Registry taking over the operation of the local land charges registers from local authorities.  That consultation closed last week.  The second one, which lasts until 20 March, proposes what many are calling privatisation of a large part of the Land Registry’s function.

Neither of the proposals appears to have gone down well.  One has to be careful since any supporters of the ideas will no doubt be drowned out by opponents, as is the usual way with these things.  But the Law Society’s Gazette last week contained an article quoting people who did not approve of the suggestions.  James Sherwood-Rogers, chairman of the Council of Property Search Organisations, is quoted as saying that this would add another layer (not lawyer!) in the process, since local authorities would still be inputting the information, but the Land Registry would be storing and extracting it. 

Superficially it seems to make sense to combine both Land Registry and local land charges data, making the register more conclusive and reducing the number of different searches that need to be carried out.  But the LLC1 search is the easy one.  There is little point transferring that to the Land Registry if the local authorities still have to answer CON29 enquiries themselves.  It is surely that process that needs to be automated and modernised.  The CON29 enquiries are mentioned as virtually an afterthought in the Land Registry consultation, but I suspect that for now they have been relegated to the “too difficult” pile (not to mention the “much too expensive” pile).  That is a pity, as some automation of that side of the due diligence process really would pay for itself in speedier deals, not least the ability quickly to update a set of CON29 responses.

Introduction of a Land Registry service delivery company

The suggestion in the other consultation, Introduction of a Land Registry Service Delivery Company, that the Land Registry (or part of it) should be turned into a service delivery company, has gone down even worse, if that is possible.  No less a person than John Manthorpe, a former chief land registrar, is quoted in the Law Society’s Gazette as saying that the proposal “is to misunderstand the clear lines of authority that flow from the chief land registrar through to his or her staff and the upward lines of reference that ensure the constant development of land registration practice.”

Once again, the popular conception that much of the Land Registry’s work is administrative (effectively changing the proprietor’s name on a register and recording the identity of lenders) means that the Government’s suggestion is superficially attractive.   The consultation paper suggests that the Land Registry service delivery company would be responsible for the processes relating to land registration, whereas the new Office of the Chief Land Registrar would primarily perform regulatory and fee-setting functions to ensure that customers’ interests continue to be protected. 

To many property lawyers, however, the Land Registry is the last participant in the conveyancing process that appears to enforce the profession’s standards.  That is probably why the idea of converting the greater part of the Land Registry into a service delivery company has not found approval.  Currently if anything goes wrong, there is a direct (although lengthy) link from the chief land registrar to the person in the land registry office who is responsible.  With the introduction of a service delivery company, that link would be lost.  The relationship becomes one of contract – similar to the privatised railways, with track run by one authority and trains by many others.  That is not a structure that many people would wish to see replicated.

There is even a group of conveyancing lawyers who have set up a website and e-petition to support the Land Registry – Save the Land Registry.  Mr Manthorpe’s consultation response is set out in full on that website (click here to see it).  Well worth a read, before you submit your own response.  Don’t forget – the consultation closes on 20 March.

The consultation response form is available electronically here.  The form can be submitted online/by e-mail or by letter to:
Kirun Patel
Shareholder Executive
Department of Business, Innovation and Skills
1 Victoria Street
London
SW1H 0ET
Tel: 020 7215 2090
E-mail: bis.lr.consultation@nullbis.gsi.gov.uk

Consultation on the future of mandatory CPD requirements for solicitors 

When you have done that, then you can turn your attention to the consultation from the SRA on the future of mandatory CPD requirements for solicitors (see my blog article here).  That consultation closes on 2 April 2014.

In the likely event that you feel you have the stamina to respond to only one of those two consultations, the CPD requirements one is the more important, I think.  In simple terms, the Government has almost certainly already decided what it wants to do with the Land Registry, whereas the SRA has not yet made up its mind about CPD requirements.

But if, like so many solicitors, you want the Land Registry to stay as it is, you could do worse than sign the e-petition on the Save the Land Registry’s website.  At the time of writing, it has gathered over 3,600 signatures.

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The name of the Game 8 March 2014

Puns, said Sigmund Freud (or, reportedly, various other writers), are generally counted as the lowest form of wit.

Don’t tell the sub-editors of Estates Gazette. Last week they presented us with:

Pegasus slots in retirement village (about redevelopment of a vending machine factory)

Roxhill and Hampton cook up Brioche plan (referring to French baking giant Brioche)

Delancey plugs in for South Bank resi tower (plans for a tower on the site of the former National Grid offices in Southwark)

Ticketmaster queues for new Manchester HQ (no explanation necessary)

Guardian makes headlines in King’s Cross (ditto)

Law firms are no better.  One of the biggest stories of the last fortnight has been the Court of Appeal’s decision in Jervis v Pillar Denton Ltd [2014] EWCA Civ 180, also known as Re Game Station Limited, about administrators’ (and liquidators’) obligations to pay rent when occupying leasehold property for the purpose of keeping a business operating.  So we have had (in no particular order):

Fair game: law overturned on rent payable during administrations (Hogan Lovells)

Game over?  Court of Appeal has a kick-about with Game administration (Dentons)

Game changer: the Court of Appeal overturns the Goldacre and Luminar decisions (A&L Goodbody)

Rent and company administrations: game over (Burges Salmon)

Game over? Court of Appeal confirms rent is an administration expense (Shepherd & Wedderburn)

Game over for Goldacre and Luminar (Clifford Chance, who should know better)

Game changer: it’s all about pay as you go (Bond Dickinson)

Fair game! (Herbert Smith Freehills.  That ! really rankles)

Game over: landlords score major victory in Court of Appeal (Squire Sanders)

Administrators and rent – Game Changer? (Bircham Dyson Bell)

Rent a higher priority in insolvency (Eversheds, clearly not understanding the rules.  To be fair, they were not the only ones)

Landlords win the Game (oops that was my blog article on this website on 24 February)

That’s enough about puns then.  I won’t hear a word against them.

PS  If you want to remove every last ounce of amusement from the idea of puns, read this Wikipedia article about them.  You’ll have forgotten how to laugh by the end.

PPS  I think this must be one of the best puns: “When my granddad was ill, we smeared goose fat on his back.  He went downhill quickly after that!”  (Thank you to MC for locating that one for me.)

PPPS  This isn’t a pun but I found it in my research for this article and liked it a lot and so would like to share it with you.  “I kept on getting into trouble at school for handing my homework in late, so I bought a book of excuses.  Unfortunately, the dog ate it.”

That’s all folks.

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Three forthcoming events in March and April 2014 6 March 2014

Here are details of three forthcoming events in the next month at which I will be speaking:

CRELA’s Commercial Real Estate Update – Central London – Monday 10 March 2014 at 6.00 pm

Three topics in a 1½ hour talk: capital allowances, chancel repair liability and the RICS Service Charge Code (new edition).  Followed by drinks.  Space is still available but booking is required.  Full details appear in this Falco Legal Training blog article

We regret that one of the speakers, Derek Hussey (AECOM), cannot attend and his place is being taken by his colleague Andy White (also AECOM).

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Falco Legal Training lunchtime talk “Priorities at the Land Registry” – Norwich – Tuesday 11 March at 12.30 pm

I will be presenting a talk at the offices of Birketts in Norwich at lunchtime on Tuesday 11 March.  Space is still available but booking is required.  Full details appear in this Falco Legal Training blog article.

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CPT conference “Business Occupation, Tenancies and the Green Agenda” – Central London – Tuesday 8 April 2014

This is a whole-day conference.  Although it has “green” in the title, the programme is not designed for ‘green experts’.  Instead it is a practical guide to what is changing and what needs to be adhered to.  It is aimed at typical property advisors – whether landlord and tenant agents, property managers, valuers, and occupiers themselves; and to property lawyers, developers and investors.

Full details appear here on the CPT Events website.

Falco Legal Training blog readers: quote Promotional Code GR1 to receive a discount of £55 off the cost of attending the conference.

 

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Commercial Property Standard Enquiries updated 5 March 2014

I consider the Commercial Property Standard Enquiries one of the miracles of the modern legal world.   They have just celebrated their tenth birthday, with little fanfare.

I have an interest to declare: I was part of the PSL team that developed the CPSEs, over a lengthy period in the late 1990s and early 2000s.  I was also involved in various updating exercises since their introduction to ensure that the enquiries were kept current and relevant.

There are plenty of critics of the CPSEs, the main criticism being that they are too long.  I don’t deny that, or that a shorter set of enquiries would be welcome.  Our view at the start was that longer, fuller questions would elicit more useful information than simple, short questions.  I suspect that was always going to be incorrect.  Every question in the CPSEs can be answered with a Yes or No answer – but you would not know it from the stock answers that tend to be produced.  Even my former law firm developed its own precedent document for the draft responses – complete with plenty of “Please rely on your own enquiries” and “Not to the seller’s knowledge but the property is sold with any there may be” answers.

But what the critics do not realise is that before the CPSEs, there was mayhem.  Or possibly anarchy.  Or perhaps both.  Every law firm had its own set of enquiries.  I will say that again for emphasis.  Every law firm had its own set of enquiries.  The same stuff, dressed up in different language.  Pages and pages of it, so that before you could answer the enquiries, you had to read them.  At least now you know what information each question is trying to elicit, and don’t have to read the question before responding by asking the buyer to rely on his local search.

There has been only one area where the CPSEs have fallen short of what was originally expected of them: capital allowances.  We included in the original enquiries a lengthy question about capital allowances – far too complex for property lawyers to answer.  The intention was that the questions would be passed to someone with more specialist knowledge, either a consultant or someone within the organisation who understood the issues.  In practice this never happened.  It was rare for anyone with any knowledge of CAs to be involved at this stage of a transaction.   This is a serious issue, as capital allowances are valuable assets, and under the new legislation they can be lost for good unless steps are taken before exchange of contracts to preserve them for later landowners.

The CA enquiries were then altered a couple of years ago to reflect changes to the relevant legislation, and became more complex still.  Now the reverse has happened.  The updated version of CPSE.1 that was issued last week (version 3.3) has a much simpler section on capital allowances than its predecessor – but it is still complex and beyond the ability of your average property lawyer to complete.  The new capital allowance enquiry is now numbered 32 (previously it was 19).  Perhaps the most important question it contains is this one:

“32.10  Please provide the name and contact details of your capital allowances adviser. Please confirm that we may make contact with him/her in order to obtain information about the matters dealt with in this enquiry 32.”

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The Commercial Real Estate Lawyers Association (CRELA) is holding a training event in London on the evening of Monday 10 March , and the key topic is changes to capital allowances.  More details appear in this blog article.

Oh yes, I almost forgot.  I am also speaking at that event, on the only topic more mind-bogglingly complex than capital allowances: chancel repair liability.

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