Oven-ready chips? Exchange-ready HIPs!

In an earlier post, I commented that the latest "improvements" to HIPs would not in fact make them more useful. What is needed (IMO) is a cultural change, so that sellers, agents and solicitors accepted that, however badly-thought-out (by civil servants and poloticians) HIPs are, the property professionals can make them work and use them to benefit buyers and sellers

If, instead of going for the cheapest HIP - which probably adds alsost nothing to the efficiancy of the conveyancing process - sellers could be persuaded to commission a HIP that would contain everything that a buyer could reasonably want before exchanging contracts, the only things that would prevent immediate exchange of contracts (and certainty) would be (a) the buyer getting a mortgage offer, (b) the buyer selling his or her own home (if needed) and (c) the seller having somewhere to move to

Exchange-ready HIPs would have -

• official search results, not personal ones which are not acceptable to all lenders
• a comprehensive set of property information, not the half-baked pointlessness that is the Property Information Questionnaire
• even a seller's survey by a real surveyor

If done properly, that would cut out delays, removing the opportunities for gazumping and gazundering, and actually achieve the objective the government said it had when it originally introduced HIPs

Will it happen? Only if enough people insist on quality work rather than the cheapest possible price

Tenterden Pudding Club

Not as interesting as the name implies ... the so-called "club" is simply an informal monthly lunchtime meeting of various local business people - mainly solicitors, accountants, estate agents, bank managers, etc

We meet on the last Friday of each month, so the next meeting is on 27 February, at No 75 in Tenterden High Street at 1pm. We usually have a one course meal and a drink, and aim to get away at about 2pm.

If any other local business people would like to join us, there is no need to book in or apologise for absence - just turn up at 1pm - but if you would like to be added to the email reminder list for future meetings, please let me know - I usually confirm the venue about 2 weeks before the next meeting.

Lawyers are not always a bad thing

People often moan about the way in which compensation lawyers encourage a blame culture, resulting in ridiculous claims and the "health and safety freeze" that (allegedly) means that schools, for instance, close at the slightest sign of snow. However, I suspect that a lot of the stories told are urban myths, encouraged by the anti-PC brigade and by those who have a vested interest in lawyers not representing claimants - so that the claims can more easily be brushed aside or settled at lower-than-appropriate figures

This article in The Times Online tends to support that view

I would always recommend someone who has suffered injury not purely as a result of their own fault to seek early specialist advice. There may be no claim, or pursuing a claim might be inappropriate, but it is better to find out first, then make a decision

I do not handle such claims myself, but (as for other legal work that I do not handle) I would be happy to refer "victims" to a suitable local specialist solicitor - just get in touch, and I will be happy to help

Uh-oh! Here comes trouble! (With added acronyms)

6 April 2009 is coming – the date from which house (and flat) sellers must have a complete Home Information Pack (HIP) in place before their property can be marketed

The HIP must contain –

• an index
• an Energy Performance Certificate (EPC) – or, for newbuilds, a Predicted Energy Assessment (PEA) - though marketing can start without these documents 14 days after their request if they are not yet available but are expected to be available within 28 days of the original request
• a Sale Statement
• a Property Information Questionnaire (PIQ)
• for registered properties, official copy registers and title plan; for unregistered properties, a Search of the Index Map (SIM) and an Epitome of Title or Abstract of Title
• for leasehold properties, a copy of the lease, or confirmation that it has been requested and is expected within 28 days
• searches: a local search and a drainage and water search or confirmation that those documents have been ordered and are expected within 28 days

There are two new elements. The first is the requirement to have a HIP in place, not just commissioned, before marketing begins. The other is that the HIP must include a PIQ.

There are different versions of the PIQ for existing homes and for new homes - a new home for these purposes is a home that is being designed or constructed or which has never been occupied. – and different versions for freehold and for leasehold properties.

The forms produced by the government do not have to be used; so long as the same information is collected. This gives those who want to prepare a more comprehensive HIP an opportunity to make the PIQ more useful than the minimal form would be, but the current trend with HIPs is to do as little as possible to comply with the legal requirements, rather than as much as possible to expedite the sale process, so I will not expect anyone to try very hard to improve on the “basic” PIQ.

It should take most sellers less than ten minutes to complete the basic PIQ for freehold properties, but completing even the basic PIQ for leasehold property will be a longer, more daunting process.

The PIQ says, “The Property Misdescriptions Act 1991 (PMA) does not apply where the form has been completed solely by the seller.” There is, therefore, a clear implication that an agent who helps a seller complete the PIQ could be liable for property misdescription if the PIQ contains errors. Accordingly, it would be best for the estate agent to get the seller to complete the PIQ alone, or to get the HIP provider to deal with it or to enlist the assistance of a local solicitor or conveyancer.

Most sellers will, after some initial grumblings, complete the freehold part of the PIQ without too much resistance. However, the leasehold part is another matter completely and I anticipate that many sellers may feel the need to speak to the solicitor or conveyancer who acted when they bought the property. Be prepared for this.

(My thanks to Rob Hailstone, CEO of HIPAG – excellent HIP providers – for his assistance to me in producing this note. Any errors are mine!)

CPD

All lawyers (well - all practising lawyers, in the UK at least; I don't know about others) are required to undergo Continuing Professional Development - basically, in-service training to keep up to date.

It can be frustrating having to spend a day or half a day out of the office when there is so much to be dealt with on one's desk; and the workload is only increased as a result of attending a well-chosen course: improving systems, updating precedents and information leaflets and generally improving standards of service as a result of what has been learned - or, sometimes, remembered - on the course.

Still, lawyers' CPD obligations are relatively light, compared to accountants' and IFAs', and polishing up one's knowledge and office procedures reaps immense benefits once the course-inspired changes have been implemented

I mention this today because I spent yesterday (Saturday) on a course - not for lawyers, but for new school governors. As a recently re-appointed governor of Tenterden Infant School, I attended an induction course at the Abbey School, Faversham with a couple of dozen other "new" governors, learning the basics - particularly that governors must not interfere in the day-to-day running of the school, but only keep an overview and ensure strategic policies are followed and the school kept within budget

Many of the attendees were first-time governors. Others, like me, had been governors a few years ago. At least one had been a teacher, latterly a senior teacher, who had been invited to become a governor when she retired. We therefore had a wide range of experience of schools. As parent, staff, community or foundation governors we also had a wide range of different starting points as governors.

Ideally, governors also come from as wide a range of backgrounds as possible, though it was noticeable that all who attended yesterday were white, they were predominately middle class (as far as I could tell); though I did not actually count, I think women were in a slight majority.

As a result of attending the course, I was reminded of the sense of satisfaction and happiness I experienced when I was a governor before, and (though there seems to be a lot more responsibility and accountability now - a good thing, I believe) I am looking forward to getting involved in the work of the governing body again.

Tenterden Infant School is, in my admittedly limited experience, a marvellous school - well run by each of the headteachers there that I have known, with enthusiastic and well-qualified teaching and other staff, the children always seem happy, well-behaved and receptive. It could be argued that this is relatively "easy" in an infants school in a prosperous rural town, but running a school is never "easy" - and running it well is always important, whatever the age of the pupils or the size or location of the school.

The input I have as a governor is relatively small, but it is wonderful to be part of such a worthwhile, hardworking and happy organisation. I would recommend being a governor to anyone who wants to help their local community and particularly to help its children and to help promote high standards of educational achievement

ID card "mission creep"

I seem to recall that, when ID cards were being proposed, we were assured that they would not be used as general means of proving ID, but only as "entitlement cards" for hospital services, benefits, etc.

If my recollection is correct, what are we to make of the comment by Meg Hillier, undersecretary of state at the Home Office, that "for legal transactions it might well be worthwhile [solicitors] having a reading machine to quickly verify ID"?

Am I being over-cynical to suggest that the government is using taxpayers' money (and citizens' personal data) to produce a scheme that private enterprise can use to sell kit to businesses for a profit?

Why Abaddon's musings?

Well, "musings" is fairly obvious, but who is/was Abaddon?

The Abaddon I have in mind is the angel of the bottomless pit - there are others, but not relevant

Partly, I am referring to the bottomless money pit that everyone (especially the tax man) seems to think I have access to, but more I am referring to what I hope is a bottomless pit of experience, knowledge, advice, etc, that I am expected to share - and which I am usually happy to do, within reason, certainly for clients and genuine prospective clients, professional contacts, etc.

I am in danger of being a "soft touch" but, as Seth Godin suggests (see lonely-scared-bitter for elucidation) calm, generous people should end up busy, happy and prosperous - well: two out of three ain't bad!

Home Information Packs

Setting to one side (for now) the inept way in which Home Information Packs (HIPs) have been introduced, and assuming (for the sake of this post) that they are, if properly implemented, a Good Thing, the changes that will take effect on 6 April 2009 are likely to have a significant impact for sellers, buyers, estate agents and lawyers. To take a couple of points -

1: The HIP will need to include a Property Information Questionnaire (PIQ). This must contain some information about the property, but it is not clear why the specified information has been selected, and the PIQ will not remove the need for the seller also to supply full, relevant information about the property. It is therefore hard to see how the requirement for a PIQ improves the HIP system. However, it can make the system worse, simply because there will be yet another document needed to complete the HIP and (from 6 April) the agent cannot start marketing the property until the HIP is complete

2: OK, so the PIQ is not difficult to complete, but I anticipate that a lot of sellers will put it to one side, if allowed to, and then complain that the marketing of the property has been delayed! To avoid that, the agent may decide to help the seller complete the PIQ - thereby risking a complaint under the Property Misdescriptions Act if any details are wrong. So, the agent risks delaying the start of marketing or risks a misdescription complaint - what a choice! The solution is (in my biassed view) to pass the responsibility on to the seller's conveyancer: if the seller uses a local conveyancer, the agent can encourage them to pop in to their office to complete the form, minimising the delay and the risk of liability

Or am I wrong? Are HIPs a great improvement, made still better by the PIQ?

Why this blog?

At the end of last year, I decided that I should start a blog, and have at last done something about it.

I do not delude myself that I have anything of particular interest to others on most topics that most bloggers (especially male bloggers) seem to want to blog - or rant - about, and this is not intended to be that sort of blog.

However, I do have concerns about various changes I see, especially to legal system generally in this country and the house conveyancing process in particular, and the impact this will have on the legal and associated professions and on businesses in small towns. I am certainly not opposed to change in principle, but I believe that the reasons for some changes are suspect and the implementation sometimes disastrous.

Though I have started this blog, I do not want it to be "mine" alone - I hope others will contribute, particularly -
- other solicitors, especially those whose views differ from mine
- other professionals involved in the areas of work that I cover as a lawyer and comment on here (estate agents, valuers, bank managers, etc, all of whom will be affected, too)
- the clients and service users who are on the other end of the experience, with their angle on things
- residents and business people in Tenterden and other small towns

I hope that my posts will be informative and constructive, and will provoke informed and constructive discussion

Well: that has set out my stall, to some extent. Now I need to start posting properly