Who Does What with Your Plot? - Part One

Apart from the estate agent, the solicitor is usually the first professional that a self-builder comes across, and in too many cases the choice of who to use is either an afterthought or a last-minute recommendation from the estate agent.

But this is a mistake. Consider able thought and research will go into the background and abilities of everybody else who will work for you on your site and the solicitor should be no exception.

Unfortunately, in many solicitors’ offices the allocation of work is based on the sale or purchase price and this may mean that the person delegated to deal with a plot is of a fairly junior nature. Once again this is a mistake. The sale and purchase of property is a complicated business and all of those complications are magnified with a plot of land which may not be registered and where obscure legal impediments may arise.

The Instructions: Once a purchase price has been agreed, solicitors are instructed. This is usually carried out by the estate agent, who informs both parties’ solicitors of the relevant details such as names and addresses, the price and whether any mortgage is required.

The Terms of Engagement: The solicitor will then send out a letter of engagement, setting out their terms and conditions and detailing their fees together with any extraneous payments to others that they will carry out. Within this letter they will inform their prospective client that before they can proceed they will need proof of identity in the form of a passport or driving licence with a photograph, together with proof of address by means of a utility bill or bank statement. This is required for each transaction whether or not you are known to the solicitor. A copy of this letter of engagement has to be signed and returned to the solicitor.

Pre-Contract: On the purchase of land the solicitor will obtain the Contract of Purchase from the vendor’s solicitor. This is one bit that often takes time, especially if the solicitor for the other side has been newly appointed and needs to obtain extra information from their clients.

Once the contract is received your solicitor will raise enquiries on it, checking that the vendor has good title to the land and making a search with the local authority. These searches are quite often carried out by private companies and their fees are therefore requested upfront when you are confirming their engagement.

The solicitor will also act on behalf of your lender to protect their interest, checking your mortgage offer and dealing with any conditions.

When all questions have been answered satisfactorily, they will prepare a report on contract, which they will either send to you or arrange a meeting to discuss and go through it. This report will re-affirm the price, the Land Registry Title number and the dates proposed for both exchange and completion of contracts. The report will also highlight aspects of the local authority and environmental searches. If there are specific covenants within the contract these will be explained and details of the current planning permissions, if any, will be attached.

Mention will be made that once contracts are exchanged and you have a beneficial interest in the land, it is your responsibility to take out suitable insurance to include public liability.

When the contract of sale is agreed they will obtain a signature from you, together with the necessary deposit.

Exchange of Contracts: When everybody is ready – and that includes everybody in the chain, if there is one – a date and time for exchange of contracts will be set. This is normally done by each solicitor talking to the preceding solicitor in the chain and agreeing to effect an exchange. Once this is done a legally binding contract exists requiring you to purchase and the vendors to sell to you.

Read part two for information on completion and choosing a solicitor

Further reading:

• Who Does What with Your Plot? - Part Two
• The Essential Plothunter's Checklist
• Read more from David Snell in his Homebuilding Blog