Coronavirus (Covid-19) and residential conveyancing transactions.

There have been many questions about the possible impacts of Covid-19 / Coronavirus on conveyancing transactions (moving house).  As Government advice continue to change on a daily basis as the virus spreads you need to be aware of the possible impacts on your move.

Issues raised have included potential:

  • Requests for properties being decontaminated
  • Refusal to vacate on completion because seller in isolation
  • Failure or disruption to parts of the banking system (such as CHAPS)
  • Inability to obtain search results if people are not available to carry out the searches
  • Reluctance on the part of removal company employees to enter properties
  • Difficulties in obtaining witnesses
  • Issues in mortgage lending surveys physical valuations

What everyone wants to understand (and ideally control) is who bears the risk in various situations?

If you have not yet exchanged

You may wish to negotiate new provisions in the contract to suit particular circumstances. The current advice from the Law Society is that they do not consider that bespoke clauses are necessary or desirable as standard.  Having said that, every situation will be different and if you are looking to exchange contracts during this time then you should consider carefully how the transaction may be affected and whether provision needs to be made in the contract.

The main concern here is of course that completion may be delayed because people cannot physically move due to current restrictions.  It is possible to draft a clause which will suspend any remedies for default but this will need careful consideration.

If you have already exchanged contracts

If completion does not take place after contracts have been exchanged due to Covid-19, the parties not completing will be in default.  The standard contract does not provide for any suspension of the remedies – nothing like this has ever been considered before!

The contract provisions relating to default will apply unless the non-defaulting party takes a ‘good faith’ view.  The Law Society is urging all solicitors to act with courtesy and co-operate with third parties in order to maintain high standards of courtesy and deal with others in a fair and honest manner

If the transaction forms part of a chain of transactions, it may not be possible to take such a view without incurring a penalty.

What can we do?

We will continue to focus on our client’s best interests and the public interest using pragmatism and common sense, it’s hoped that this can be dealt with without too much disruption to the usual process.

If chains are affected, the aim would be to provide the same solution and let the risk fall in the same place across the chain.

Inevitably, there will be a few chains where one or more of the parties in a chain insists on taking a stand to gain an unfair advantage.

In these uncertain times the best advice is to speak to your solicitor and consider all of the options available to you and to fully understand the risks during these unprecedented times.

For further guidance, please click here for the latest UK government advice:  https://www.gov.uk/guidance/government-advice-on-home-moving-during-the-coronavirus-covid-19-outbreak

Residential Property & Conveyancing Services

Lupton Fawcett is a leading personal and commercial law firm in Yorkshire with well-established teams of Residential Property Solicitors at each of our offices. You can find out more about our Conveyancing teams in West Yorkshire, North Yorkshire and South Yorkshire here:

Leeds Conveyancing

York Conveyancing

Sheffield Conveyancing

For further help or advice on the contents of this article or Residential Property generally, please contact Sarah Sargent in Sheffield on 0114 228 3281 or Richard Baum in Leeds on 0113 280 2061 or Jaime Dodd in York on 01904 561425 to discuss how we can help.

Sarah Sargent is a Partner and Head of Residential Property at Lupton Fawcett.

Please note this information is provided by way of example and may not be complete and is certainly not intended to constitute legal advice. You should take bespoke advice for your circumstances.

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