Local Authority Searches - a necessity for property transactions
As a buyer, the burden of Local Authority Searches for residential and commercial properties and unoccupied land always falls on you, as you have the most to lose. The seller need not disclose every minute detail relating to the property, and his home information pack cannot be taken at face value. So, it’s up to you and your conveyancing solicitor to organise surveys and submit applications for all the necessary searches and enquiries to verify all aspects of the property.
It’s imperative that all surveys and searches are conducted before you enter into a binding contract. If the searches reveal facts and details that are not acceptable, you will have the opportunity to re-negotiate the deal or withdraw from the transaction, without being liable for breach of contract.
It’s plain to see the folly in side-stepping the headache and added expenditure of surveys and Local Authority Searches when it comes to transferring ownership of property, so make it a point to play by the book to ensure your property is not tainted.
What is a Local Authority Search?
Once your conveyancing solicitor has been instructed to proceed with the transaction, he should waste no time in applying for the relevant searches as local authorities may take time in responding. Apart from the Borough Council, there are several private companies that offer Local Authority Search services, but the source of their information will be from the local authorities responsible for your council.
The National Land Information Service (NLIS) that came into being in 2001 offers electronic access to any property related information, making it a one-stop shop for conveyancers looking to speed up the transaction process. A central hub has been instituted by the NLIS and three channels TM Search, Jordans and Searchflow are currently licensed to access the information.
This transition to online conveyancing has made it easy on the conveyancer who just has to tick the types of searches necessary for the property in question and order them through one of the licensed channels. He will receive the data in no time, depending on the nature of the search.
But, the only hiccup is that all local authorities are not connected to the NLIS and those searches will have to be requisitioned through paper applications and received by post.
Types of searches
The following searches are a must for every proposed transaction whether residential or commercial:
OFFICIAL SEARCHES
Local Land Charges Register Search
The Local Land Charges Register is open to public inspection and can be accessed with the submission of Form LLC1. It is divided into many parts which include among others…
- orders granting, revising or revoking planning permissions
- restrictions on development
- property ownership history
- enforcement action against property
- neighbouring road schemes
- contaminated land
- tree preservation orders that prevent felling of protected trees
- smoke control orders for domestic fireplaces
- financial charges for adoption of estate roads etc.
- compulsory purchase orders
For a Local Land Charges search, Form LLC1, completed in duplicate, has to be submitted to your local bourough council, with a plan of the land (also duplicate). It’s wiser to conduct all searches listed on the form. This service is chargeable at standard rates.
The official search is conducted by trained local council employees who work in their Local Land Charges unit. This team maintains the Local Land Charges Register and conducts property searches when required. They will ensure that the information noted in your search report is relevant and accurate.
The search result is given as a certificate, signed and sealed by a council officer. A list which contains the gist of all the relevant entries that were investigated will be attached too.
After receiving the required certificates, your conveyancer will apprise you of the implications of the search and how they affect your deal. For instance, if there are financial charges pending, the seller should be asked to pay these prior to exchange of contracts or reduce the amount from the purchase price.
If a buyer bears a loss due to an error in the official search certificate he is eligible for compensation under s10 of the Local Land Charges Act 1975.
Enquiries Conducted By Local Authority
Form CON29 comes into play when you want to make local authority search enquiries for particular property. Some local authorities accept electronic requests for search applications, while others insist the applications are sent by post in duplicate. The fee for this search varies from authority to authority.
The form is divided into two parts – CON29R and CON290.
Enquiries that come under CON29R are relevant to all transactions and are covered by the fee quoted by the local authority. Some of the searches applicable to this form are:
- Whether approach roads to property are maintained at public expense
- If there are plans for roads and railways within 200mts of property
- Whether any planning applications have been sanctioned or denied
- If there are tree preservation orders
- If there are restrictions on permitted development
- If enforcement and stop notices have been complied with
The enquiries that come under CON290 are more specialised and may not apply to all transactions. Here, you must tick the enquiries that are relevant to your deal as each search is charged a separate fee.
All these searches and enquiries will reveal data and issues that pertain to the property itself and not adjoining land that may indirectly affect the property.
A local authority can be sued for negligence if there is a discrepancy in the search information subject to the validity of the exclusion clause given in the application form.
Differences between LLC1 and CON29
Your conveyancer will ideally submit both these search applications simultaneously as they are essential in every property transaction. Though both these forms come under the general term ‘local search’ they are completely separate searches with different functions.
- Form LLC1 only deals with matters that fall under the local land charge while Form CON29 covers many matters that are not restricted to land charges.
- The local authority is liable for errors under Form LLC1as negligence need not be established and compensation has to be paid, whereas under Form CON29, negligence leading to errors has to be proved.
- Form LLC1 will only reveal information which is on the Land Charges Register at the time the search is made. Form CON29, on the other hand, can reveal information that has affected the property in the past and will do so in the future.
PERSONAL SEARCH
Many people opt for personal searches primarily because of the delays in receiving the local searches and enquiries report. You can either appoint agents who, for a fee, will visit the necessary local authority offices and make the search personally. Or you can use the speedy services of organisations such as Onesearch Direct that have their own database of local search information and will provide it for a set fee.
If your conveyancer opts for a personal search, make sure the person/organisation is adequately trained and supported with sufficient insurance to cover the search results. There is a Search Code in place to ensure consumer protection and this is monitored by an independent Property Code Compliance Board.
If you are taking out a mortgage to purchase the property, you must confirm whether your lender will accept searches and enquiries that are not conducted by official authorities.
A personal search may be cheaper and faster than an official search, but you should not neglect the importance of its accuracy. When you have a choice, it’s always wiser to apply for a full official search and bear the difference in cost as you cannot afford to get outdated or wrong information.
SELLER’S PROPERTY INFORMATION FORM
This is another of the usual searches conducted by the buyer’s solicitor. The Seller’s Property Information Form will reveal physical aspects of the property and give the buyer a more wholesome picture of the property he has his eyes on.
The only hitch is the seller is not bound by law to disclose any of these facts. But the chances are the seller will oblige and fill up the required form if he wants to make the sale at the earliest with no hiccups along the way.
Here are a few minimum pre-contractual enquiries that this search should disclose:
- Whether there are ongoing disputes with neighbours be it owners or tenants
- Who presently occupies the property
- Whether there has been change in the use of the property
- Whether services to neighbouring land pass through the property on sale
- Whether services to the property on sale pass through neighbouring land
- Whether alterations or new structures have been put up with necessary permits
Your solicitor will analyse the responses to these queries and advise you on how it will affect your use of the property, if you decide to buy.
WATER AND DRAINAGE ENQUIRIES
Local authorities no longer play a role in dispensing information about water and sewage matters relating to particular properties. Such enquiries can be made by submitting Form CON29DW with the specified fee to the water service company serving the property.
The enquiry will reveal whether:
- The property has foul water drainage to the public sewer
- The property has surface water drainage to the public sewer
- There is a water main within the property
- The property is connected to the public water supply
If this information is given in the seller’s Home Information Pack, your solicitor will have to verify the facts and the date on which the search was conducted. If it is older than six months, then a new search will have to be carried out.
LAND CHARGES DEPARTMENT SEARCH
This search is mandatory if you are dealing with unregistered land and should be carried out prior to exchange of contracts so that all creases can be ironed out before completion.
Even with registered land, the seller’s solicitor may make a search against his client to ensure there are no bankruptcy proceedings pending against him. This search can be made by submitting Form K15 (full search) or Form K16 (bankruptcy only) to the Land Charges Department at Plymouth.
The Land Charges Register lists all the previous owners of the property and searches are made against all the names and not against the property itself. The fee is charged for all the names searched.
This search is particularly important to determine if there are any land charges against the property that would be binding on the buyer if the property were to change hands.
If completion of the deal does not take place within 15 days of the search certificate issued against the seller’s name, the search will have to be repeated just before completion.
COMPANY SEARCH
If the seller is not an individual but a company, then a search should be carried out to see if the company:
- Exists in the first place
- Has the authority to buy and sell land
- Has no hidden fixed or floating charge that affects the property on sale
- Is not in administration, receivership or liquidation
Your solicitor should apply for the appropriate search to Companies House in London or Cardiff. The search can also be made on the Companies House website www.companies-house.gov.uk. The search will reveal all the documents the company has submitted at Companies House including constitutional documents like memorandum and articles of association, details of its officers or board of directors, filed accounts and details of mortgages.
There is no official procedure for this search and it offers no protection for the applicant, but it is advisable to do it ahead of exchanging contracts. If any problems should emerge your solicitor will be able to sort it out before completion.
ENVIRONMENTAL SEARCH
Environmental issues have to be considered and researched before committing to purchase any property. A search should be conducted to see whether the property is contaminated in any manner. Besides the expense of cleaning up the property, there could be unforeseeable dangers caused by the contamination in the long run.
The Law Society has taken the matters of contamination very seriously and has issued a Warning Card to solicitors to confirm that the property is free of environmental contamination before advising their clients to proceed with the purchase.
Other environmental hazards you must consider are:
- Whether the property is near a landfill site
- Are there factories/industries nearby discharging hazardous waste
- Whether the land is at risk of flooding
Hence, it better if prudence prevails and you obtain an environmental report about the area where the property on sale is located prior to exchanging contracts.
LESS COMMON SEARCHES
There are some less common searches that become necessary based on certain aspects and location of the property. Your solicitor will be liable for negligence if he fails to carry out these searches in circumstances where he should have. Some of the less common searches are:
- Coal mining search: If the property is located in an area where there is or have been coal mining operations.
- Commons Registration Search: If property is adjacent to a village green or common land etc.
- Flooding Search: If property is at risk of flooding
- Land adjoining water bodies: If property is situated next to water bodies, enquiries must be made to confirm maintenance of riverbanks or canals.
- Land adjoining Railways: If property lies adjoining a railway line, enquiries must be made to check if property owner has any obligations in maintaining boundary walls and fences.
All these searches provide invaluable data and information that has to be thoroughly analysed by your solicitor. He will advise you about the pros and cons of the property based to the search results and offer solutions to tackle small issues. You have the liberty to take your time and make sure all your outstanding queries are resolved satisfactorily before committing to purchase the property.
This may seem like a tedious process, but if your solicitor handles your transaction effectively you can breeze through the search and enquiries process. And it’s worth every penny, as you have the knowledge and assurance that the property you are going to purchase will be valuable and secure investment!
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