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Solicitor fails to pay off charge on sale

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Re: Solicitor fails to pay off charge on sale

Postby atticus » Thu Jun 02, 2016 5:26 pm

In which case, the purchaser has potentially 3 avenues of recourse (seller, seller's conveyancer in respect of any undertaking, own conveyancer), whereas the lender's recourse is to his security. The court may take the view that there is no real injustice in allowing the charging order to be enforced, particularly if a timetable is set which allows the purchaser to get someone else to stump up the cash.

The OP will also know that third party security is far from unusual.
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Re: Solicitor fails to pay off charge on sale

Postby Millbrook2 » Fri Jun 03, 2016 8:55 am

Smouldering Stoat wrote:But they didn't. The purchaser expected the vendor to pay off the debts with the proceeds of sale and to clear the charge.


I had a similar situation. A neighbour gave me a loan secured against the property when I had a serious illness and could not work for a year. Years later when I sold the house the charge was cleared automatically by my solicitor.

I'd have thought it was automatic that the sellers solicitor would do this and it would be negligent for them not to do so?
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Re: Solicitor fails to pay off charge on sale

Postby atticus » Fri Jun 03, 2016 10:05 am

Possibly, but what is the seller's loss?
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Re: Solicitor fails to pay off charge on sale

Postby theycantdothat » Fri Jun 03, 2016 1:35 pm

Millbrook2 wrote:I'd have thought it was automatic that the sellers solicitor would do this and it would be negligent for them not to do so?


The point is rather that on an arm's length sale the buyer's conveyancer ought to insist it is paid off. Everyone slips up now and then and it is possible to overlook something. In my friend's case the buyer's conveyancer slipped up and the seller's conveyancer forgot his instructions to pay off the charge.
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Re: Solicitor fails to pay off charge on sale

Postby theycantdothat » Fri Jun 03, 2016 1:36 pm

atticus wrote:The court may take the view that there is no real injustice in allowing the charging order to be enforced, particularly if a timetable is set which allows the purchaser to get someone else to stump up the cash.


I think that that would be the right view.
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Re: Solicitor fails to pay off charge on sale

Postby dls » Sat Jun 04, 2016 7:59 pm

The solicitors acting for both parties should have followed procedures. Someone didn't.

It is by no means impossible for a charge to be left properly on a sale. Scandinavian conveyancing systems seem to do this by default, but with other arrangements (the buyer takes over the existing loan(s) and takes out only a new one as needed.

There is no reason why the court should allow the unpaid chargee to suffer any prejudice.
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