Conveyancing Q&A

Ian Quayle, Chief Executive of IQ Legal Training speaks to Index Property Information in advance of a series of joint ten hour-long free webinars covering residential and commercial leasehold transactions.


Leasehold can throw up all sorts of problems and can be a ‘hot bed’ for negligence claims – in your experience what are the most common challenges?

Professional Indemnity Insurance providers are reporting an increase in negligence claims around the transmission of information to clients rather than procedural problems. It is, therefore, essential that leasehold conveyancers communicate the implications of owning leasehold properties to their clients thoroughly.


It’s all too often we see someone purchasing a flat in London and believing they can rent it out via Airbnb while they go on holiday or traveling. This would breach most leaseholder contracts. This is a simple example but there are plenty of other potential challenges which also require correct and careful communication with clients.


Common procedural issues which can arise can relate to the fact that there are two different titles involved: the leasehold and the title out of which the leasehold in derived. Leasehold conveyancers also need to deal with landlord enquiries, restrictions on title and ensuring assignment is noted by the landlord on completion.


When it comes to client communication, leasehold conveyancers need to be able to describe the peculiarities of the landlord-leaseholder requirements. This can’t be a one-way street; conveyancers need to gain confirmation that clients have understood their sometimes-complex contractual obligations.



What can potentially go wrong?

One of the main problems is that the acquiring leasehold title isn’t’ good and marketable and this results in issues for leaseholder client and the lender. For example: the lease may be defective, or the title is not an absolute leasehold title.


There may also be more subtle challenges with different landlords or problems with leasehold management.


What are the main things to check/look out for?

When drafting and advising on residential leasehold contracts, conveyancers should consider items such as: the remaining term, user conveyance, repair obligations, service charges, insurance and forfeiture provision for example. In addition, with high rise flats, fire safety and cladding may be an issue. There is little standardisation with leaseholder contracts so care should be taken with each leaseholder agreement or form of lease.


Have there been any legislative changes which conveyancers should be aware of?

Most recently we have seen changes to fire safety and building regulations. We also anticipate a re-launch of Commonhold, so keeping abreast of legislative changes will enable conveyancers to provide best advice for clients.


There have also been changes in attitude towards best practice when dealing with compliance certification such as EWS. In relation to surveys and valuations, such certification or lack of it, impacts on the valuation and lender security.



Has COVID changed/exacerbated the situation?

COVID created the perfect storm for increased negligence claims. Conveyancers have been under intolerable pressure with increased workloads. Many staff were and still are, working from home so are not easily able to seek a second opinion on a matter.


There was little or no face-to-face contact with clients which led to challenges of ID verification and of course, ensuring they understood the obligations leasehold generates. Because conveyancers were so busy, there was also lack of time for CPD training too.


How should conveyancers protect themselves and their clients to mitigate any risk?

Correct client communication is key. It needs to be two-way to ensure clients understand advice relating to the limitations and terms of their lease.


Training is also important which is why we’ve created this series of free webinars brought to conveyancers in partnership with Index Property Information. New conveyancers can learn about the procedural challenges relating to leasehold but also develop the ability to spot unusual problems.


For experienced leasehold conveyancers, keeping up with the current trends and legislative changes is necessary and this series of webinars will help with continued professional development. During the sessions, I will be providing detailed notes and there will be the opportunity to ask questions. This offers me the opportunity to do any further research on a specific issue and the information gained fed back into future sessions for the benefit of conveyancers and their clients.



This article was first published on Today’s Conveyancer.


Visit Index Property Information for more information about the upcoming conveyancing webinar series here.