Property: Playing safe: on the right track?

There was a day when the process of buying and selling in Scotland was hailed as one of the jewels in the crown of the Scottish legal system, when an acceptable offer would be followed by early conclusion of missives and a binding contract, and everyone knew where they stood.

We would pour scorn on the unsatisfactory system south of the border. In England, particularly in times of flux, the pressures of a rising or falling market and the merry dance between offer being agreed and contracts exchanged would take months, with buyers and sellers open to gazumping or gazundering while seemingly powerless to cement the deal, and being left with the ever present worry that, somewhere along the line, it could all come tumbling down like a house of cards. The longer the chain, the weaker the links and, even with good faith on the part of the principal players, if some party in the process wasn’t playing ball, the conveyancing train would come off the rails, leaving the faultless parties with no deal and no right to compensation for the disappointment and non-recoverable expense, not to mention lost time and money, and added stress.

Are we doing better?

There seems to be universal agreement that reform of the house buying process in England & Wales is long overdue, while key players outside the legal profession engage in the usual lawyer bashing and seek to tap into this public dissatisfaction with failed and slow sales progression, with their own versions of the one stop shop and IT platforms in an attempt to give the impression that they have the solution. We may scoff, but if we take a leaf out of Burns’ book and see ourselves as others see us, in truth are we really that much better in Scotland?

No doubt much of the blame can be attributed to factors outwith our control resulting in a lengthier period of uncertainty between offer and concluded missives. One of the main causes has been the time taken to process mortgage applications, with offers, other than cash offers, being conditional on the loan coming good. A mortgage promise is no longer considered worth the paper it is written on, and conveyancers wisely delay concluding missives until the buyer has the loan in place.

Where the purchaser has a property to sell, the offer missives may also be delayed until the sale concludes. The result is that with the exception of straight cash offers, very few transactions conclude within a few weeks from the offer date. Further complications arise in cross-border transactions where a buyer is relying on exchanging contracts. Inevitably, where there is uncertainty, this slows down the process and we end up with a backlog due to a reluctance of some to progress any conveyancing until all the ducks are lined up with all the lights at green.

As a result, nothing gets done and, like in England, chaos reigns with a last minute rush to get everything in place. Meanwhile the clients are left in the dark, biting their fingernails, worried the deal will collapse and bewildered at a process which they mistakenly thought was secured weeks or months earlier, only to find that in reality they were left exposed, or face a last minute rush and apparent panic in the week, days or even hours before cash and keys are exchanged with the deal finally secure.

Just the way it is?

By our nature conveyancers are conservative (with a small c), and most would not contemplate advising a client to agree to anything that exposes them to any degree of risk. Clearly, backs need to be covered and advisers need to protect clients, and themselves, against the possibility of things going wrong. But a no can do sir, jobs worth approach doesn’t do clients or the legal profession any good. It may be the safe approach to do nothing, but sitting on hands or blaming the system, or the “other side”, simply adds to the frustration, stress and uncertainty and, inevitably, the affected clients will blame the lawyers.

In reality, even these days most deals stick, and once through the jungle, despite the frustrating delays, most clients emerge to the light of a new dawn and achieve house buyers’ nirvana when they get the keys to their new house – though in all too many cases with a soured experience tainted by the process.

It is surely in the interests of the legal profession, and our clients, to improve on what for many has become a poor experience. Accepting that deals come good in the majority of cases, it makes sense to progress and prepare as much of the groundwork as possible, to minimise stress and delays further down the line. Clearly it takes two to tango, but those conveyancing firms that take a proactive and progressive approach should benefit both their clients and their business, so others eventually see the sense of following suit.

Over the years the Scottish legal profession has been keen to promote the benefits of our system and has introduced practices and procedures that help smoothe the process. Among these has been an almost universal acceptance of a standard set of conditions which are adopted in most formal offers, covering the sort of issues that other systems leave for pre-contract enquiries, thus avoiding delays and flagging up issues with professional advice and guidance at the outset so there should be no nasty surprises.

Principle and practice

Leaving aside the factors causing delays, there is still an underlying principle that you act honourably and do unto others as you would have them do to you.

In Scotland we still have an excellent and efficient system. As a rule, if a client goes back on a commitment and changes tack without justification, a Scottish solicitor will not simply act as a mouthpiece and do their instructing client’s bidding but would feel professionally obliged to withdraw and tell them to go elsewhere. The practice rules and guidance notes laid down by the Law Society of Scotland enshrine noble and time honoured principles; but in practice do they hold water, or do some seek to hang on to the defaulting client and the prospect of payment?

Despite the guidelines, it is not uncommon to have an offer that fails to disclose a dependent sale or some other undisclosed precondition, with a tempting offer being accompanied by expressions of good faith but with any attempt to progress missives beyond the offer stage then falling on stony ground.

Get in first

Is it not time to address the issue and remind the profession that we are not simply mouthpieces?

We represent and advise clients against an established background of ethics and professional practice that demands respect and an appreciation that others are making plans relying on the offer coming good. We do not ply our trade in a vacuum, and while clients are left disappointed and without a remedy, failed missives have consequences and uncertainty has a knock-on effect.

Clients, both buying and selling, deserve a better service, and failing to adhere to high standards, and to appreciate the need to respect the “other side”, leads to chaos, uncertainty, frustration and expense both for clients and the profession. Loss of reputation for an individual or firm is bad enough, but damage to the hard earned reputation that the legal profession has in the eyes of the buying and selling public could be a huge loss to both the profession and clients, and once gone would not be likely to be restored.

Now is the time to get our conveyancing house in order before those in power decide to step in and impose a solution on us. You may think that unlikely, but consider the response to consumerism that gave rise to the imposition of the SLCC, who are only too happy to entertain any expression of dissatisfaction. If nothing else, the administrative cost of dealing with a complaint to that body by a client or an affected third party, which might be a dissatisfied client on the “other side”, should be incentive enough to keep most conveyancers on the right side of the track!