Clarke and Son News

An article in the Law Society Gazette On-Line comments on a report that Home Information Packs (HIPs) have reduced the number of failed transactions.

Conveyancer and HIP provider myhomemove said the packs had caused the number of failed property transactions it was involved in to dip to 9% since the full introduction of HIPs last April. The figure was significantly lower than the 23% average failure rate published by the government in 2007, before the introduction of HIPs.

The data for more than 10,000 sales where myhomemove acted for buyers also showed HIPs had speeded up transactions by about six days, with average time taken to complete now 50 calendar days.

However, Richard Barnett, chairman of the Law Society’s conveyancing and land law committee, commenting on myhomemove’s figures, said HIPs were unlikely to have played a significant part in reducing the failure rate.  Instead, he put the drop down to the unusual market conditions.

Paul Cowdery of Clarke & Son comments:

HIPS with up-to-date searches (i.e. usually no later than 3 months old when we receive instructions) can help to speed up the legal investigation of papers, but I still find in practice that they are of little interest to purchasers who only rarely say that they have viewed the HIP before putting in an offer.  If the market is active then HIPs can help but where it is sluggish there can be duplication of cost where buyers have to renew out of date searches. The jury is still out!

For further information on legal services when buying or selling your home or for the preparation of or consideration of a HIP then contact Paul Cowdery or Jenny Axe on Tel: 01256 320 555.

The Health and Safety Executive (HSE) has published Asbestos: The Survey Guide, which provides guidance on asbestos surveys and includes information on the dutyholder’s use of survey information.

The guidance has been prepared to help those responsible for managing the risks from asbestos best protect those workers who may disturb it.  It will:

• Help people who carry out asbestos surveys and those with specific responsibilities for managing the risks from asbestos in non-domestic premises under regulation 4 of the Control of Asbestos Regulations 2006 (CAR 2006).
• Provide guidance in situations where surveys may be carried out for other purposes, for example for managing asbestos in domestic premises under wider health and safety legislation and for meeting the requirements of the Construction (Design and Management) Regulations 2007 (CDM).

The guidance is aimed at those who commission asbestos surveys, the surveyors who carry them out and those who use the surveys, such as architects and demolition or removal contractors.

For more information, please contact Charles Marchant-White on Tel: 01256 320 555.

Clarke and Son is currently looking to fill two vacancies in the Conveyancing and Private Client Department respectively.  Please click here for more details.

The Inheritance Tax Nil Rate band (the amount that can be given away on death without incurring Inheritance Tax - subject to lifetime gifts) is generally increased each year in line with inflation unless an alternative band is provided for.  The Finance Act 2007 currently provides that the nil rate band will rise to £350,000 for individuals dying on or after 6th April 2010.  It was however announced in the pre-budget report that legislation will be introduced in the Finance Bill 2010 to set the limit of Inheritance Tax Nil Rate band at £325,000 for the tax year 2010-11.  The chancellor explained they were reducing the level from £350,000 due to the fall in property prices.

 For more information on Wills & Probate and Inheritance Tax, contact Nia Wharry on Tel: 01256 320 555.

All businesses will need to understand what the introduction of the Provision of Services Regulatons 2009 will mean to their businesses. The Regulations came into force on 28th December 2009 and  apply to the majority of private sector businesses providing services in the UK, unless they provide an excluded service. They require businesses to make information available to customers, and to deal with customer complaints promptly.  The Regulations also prohibit discrimination against individual customers in the provision of services on the basis of their place of residence.

 Please see the attached checklist - provision-of-services-regulations-2009-checklist.pdf  -  to help you get up to speed with your obligations under the Regulations.

 For more information on business services, contact Peter Turner on Tel: 01256 320 555.

In Fidler V Secretary of State for Communities and Local Government [2010] EWHC 143 (Admin), a landowner built a house without obtaining planning permission and concealed it behind bales of straw covered with tarpaulin.  After four years, the landowner removed the straw bales and the tarpaulin to reveal the house.  Within a year of the bales being removed, the local planning authority issued an enforcement notice requiring the landowner to demolish the house.

The landowner claimed that the property was immune from planning enforcement action because more than four years had passed since the building operations were substantially completed.

The High Court held that the erection and removal of the bales and tarpaulin were not building operations in their own right.  However, the landowner had always intended to remove the bales and tarpaulin so, as a matter of fact and degree, their removal was part of the building operations when the totality of the operations as originally contemplated and intended was considered. The property was not immune from planning enforcement action.

At first glance, the decision that taking down a wall of straw bales amounts to building operations appears to be surprising. However, it is a good illustration of the holistic approach take by the House of Lords in Sage v Secretary of State for the Environment, Transport and the Regions [2003] UKHL 22 and makes it clear that the meaning of “building operations” for the purposes of section 171B of the Town and Country Planning Act 1990 (TCPA 1990) is wider than the definition set out in section 55 of the TCPA 1990.

For advice and assistance relating to developments please contact Charles Marchant-White or Chris Lockley on Tel: 01256 320 555.

The Department for Communities and Local Government (DCLG) has published the responses to its consultation on how to improve standards in the private rented sector.  The report explains the DCLG’s next steps and its plan for further work with stakeholders.  It intends to implement the following key measures:

• A hotline for private tenants offering free practical advice (by Summer 2010).
• A “Tripadvisor” style website comparing landlords (by Summer 2010).
• A mandatory national register of landlords.
• Regulation of letting and managing agents.
• Mandotory written tenancy agreements.
• An increase in the maximum rent for assured shorthold tenancies  to £100,000 per annum (from 1 April 2010).
• The creation of local letting agencies and landlord accreditation schemes.

For advice and assistance relating to private lettings, please contact Paul Cowdery on Tel: 01256 320 555

On 26 January 2010, the FSA published a consultation paper entitled ‘Mortgage Market Review: Arrears and Approved Persons’.

In this paper, the FSA sets out a package of measures designed to strengthen its current rules on arrears handling and approved persons.  These were identified by the FSA in its October 2009 mortgage market review discussion paper (DP09/3) as priority areas that need addressing.

 The FSA proposes a number of measures to help to ensure that mortgage holders in arrears are treated fairly.  The key measures proposed clarify the FSA’s existing arrears handling rules and introduce some new provisions.  They include:

• Clarifying that firms must not apply a monthly arrears charge where a firm and its borrower have agreed an arrangement to repay the arrears. Any charge imposed should represent the cost of additional administration work.
• Clarifying that firms must not add early repayment charges (ERCs) on arrears charges and interest levied on those charges.
• Clarifying that payments by borrowers in financial difficulties must first be allocated to clearing missed monthly payments, leaving charges to be paid later.
• Requiring firms to consider all options for borrowers, with repossession always being the last resort.
• Obliging firms to record all arrears handling telephone calls and to keep all arrears records for three years.

If you have any questions about mortgage payments contact Paul Cowdery on Tel: 01256 320 555.

The recent pre-budget report has highlighted the following issues that may be of interest to Tax payers:

National  Insurance - All rates of National Insurance will increase by 0.5% from April 2011, in addition to the 0.5% rise announced in the 2008 Pre-Budget Report.  The threshold at which National Insurance becomes payable will be increased by £570.

 Income Tax - Personal allowances and the higher rate threshold for 2010/11 will be frozen at 2009/10 levels. A 50% tax rate will apply to income over £150,000 from 2010/11.  The higher rate of income tax threshold will be frozen in 2012/13 at the 2011/12 level.

Restriction of Pension Tax Relief - The rules introduced in Budget 2009 have been tightened so that any pension benefit provided by an employer or third party will be taken into account in calculating whether a person’s income exceeds the £150,000 threshold.  Also, the anti-forestalling measures have been extended to restrict irregular pension contributions over £20,000 (or £30,000 in some circumstances) for those whose income is £130,000 or over from December 2009.

Inheritance Tax - The Inheritance Tax allowance will be frozen at £325,000 in the 2010/11 tax year. Legislation closing two Inheritance Tax avoidance schemes involving the transfer of property to a trust in which the transferor retains a future interest, and also where a person purchases an interest in a trust will in all likelihood be introduced.

If you are interested in Estate Planning Issues, please contact Nia Wharry on Tel: 01256 320 555.