The Consumer Protection from Unfair Trading Regulations 2008 (as amended) prohibit trading practices that are unfair to consumers. This includes:
- misleading actions
- misleading omissions
- failing to act with the appropriate standard of care and skill
In conveyancing, misleading actions could include giving wrong information about whether a property is fit for purpose, or about the results of a survey.
Misleading omissions could include not telling a buyer about a defect with the property. To comply with the rules, you should make full disclosure to buyers or tenants, or to their solicitor, about defects and any other “material information” that you know of relating to the property. You’ll need to get your client’s permission to do this.
Information is “material” if the average consumer would need the information to make an informed decision about the transaction.
Explain to your client that:
- you or the client must not mislead the buyer or tenant by providing incorrect or ambiguous information, or withholding material information
- certain information about the property is likely to be revealed through searches and enquiries
- their buyer will have rights under the regulations, and may be able to claim damages from the client if they were misled about the property
Confidentiality and disclosure
Under the SRA Code of Conduct 2011 you have a duty of confidentiality to your client. This could conflict with your duty of disclosure under the Consumer Protection from Unfair Trading Regulations 2008. For example, your client might tell you about a defect with the property, but instruct you not to tell the buyer.
In these circumstances, you should strongly advise the buyer to disclose the information, and if they refuse, consider whether you can continue to act for them while meeting all your professional and regulatory obligations.
For more information, see our practice note on Consumer Protection Regulations in conveyancing.