We updated the Code for Completion by Post in May 2019 to clarify the code following the Court of Appeal’s decision in Dreamvar.
There are no changes in substance to the previous edition. You do not have any additional responsibilities under the 2019 code.
The revisions aim to make it clearer that the seller’s solicitor only gives undertakings where there’s a genuine sale.
This should give innocent purchasers greater protection from fraudsters – which should help boost consumer confidence in the conveyancing process.
Responsibility of the seller’s solicitors
The 2019 code has the same effect as the previous code, as interpreted in Dreamvar.
The code does not place any additional responsibilities on you when you act for the seller. There is no change to your existing obligations to verify your client’s identity.
Duty to verify authority from the genuine seller
The Court of Appeal confirmed that when you use the code, you undertake that your client is legally entitled to sell the property. This has not changed in the revised code.
You should still take reasonable steps to make sure that:
- your client is the person they claim to be
- they are (or will be) entitled to transfer the property at the point of completion
When you use the code, you automatically give undertakings based on your having authority to act for the genuine seller. This is the person entitled to convey the legal and/or equitable title.
If you’re acting on behalf of the seller, you’re in the best position to make sure that the person instructing you is entitled to sell the property.
If you cannot be sure of your client’s identity, you should consider whether it’s safe to continue acting.
Information on identifying your client can be found in our guidance on property and title fraud.
Warranties and undertakings
When you use the code, you give professional undertakings.
The operative words of the undertakings and their effects have not been changed. The 2019 code does not require any further warranty or undertaking.
Undertakings to discharge mortgages
When you act for the seller, you undertake to pay the lender the amount required to discharge their charge. We have not changed the effect of this undertaking.
You must let the buyer’s solicitors know in writing of any charges to be redeemed or discharged on completion. This includes:
- other financial incumbrances
You undertake to pay the lender all the incumbrances identified before or at the point of sale. We have not changed the effect of this undertaking.