Principals not agents
In almost all aspects of selling and buying property the solicitor acts as agent for the client, but in two instances the solicitor acts as principal and these are in the granting of a letter of obligation and certifying a title to a lending institution.
If you are buying a property with some sort of title quirk and the selling solicitor is trying to get round your misgivings by suggesting you should ask your client to “take a view” on the matter, you politely inform the solicitor that if the lender has to take possession of the property at some point in the future and the title issue causes them to lose money on a forced sale, the lender will be looking to you for compensation, therefore it is your view of the title and not the client's view which will prevail. If the other solicitor is embarrassed by not having picked up the title quirk when they bought the property, they should not be looking to you to get them out of a tight corner.
A solicitor normally takes their client's instructions, but a client cannot instruct us to certify to a lender that a title is in order when we regard it as defective. If the client is buying the property without a mortgage, they can instruct us to accept the title as it stands, but in such a case you have to protect yourself by writing to the client giving a full explanation of the position and enclosing a duplicate copy of the letter suitably docqueted for the client to sign and return, so that you have direct evidence on your file that the client has taken the risk on themselves.
If the title problem rears its ugly head in the fullness of time when the house comes to be sold, the client will not be able to profess ignorance of the title issue and say “If this had been properly explained to me at the time, I would never have gone ahead with the purchase.” If there is any risk involved and you have pointed it out, the risk has to rest squarely with the client. We provide legal services, not indemnity insurance, in cases where the clients decide to take a gamble in the certain knowledge that that is exactly what they are doing.
“Oh, the weekend”
There almost appears to be a tradition that property sales and purchases have to take place on a Friday. When you ask the client why they are insisting on settling on a Friday they usually reply “Oh, the weekend”. There is no use pointing out to them that the weekend comes not only after Friday but also after every other day of the week from Monday onwards. They want to settle on a Friday and that is all there is to it.
Many solicitors reading this might agree wholeheartedly that there is no rhyme or reason for Friday settlements, but this will not stop them putting a Friday settlement date into the next offer they make for a property.
Delays in winding up estates
The “tipping point” for beneficiaries in an executry is 12 months after the date when the person died. If the first anniversary is approaching and there has been some unavoidable delay in administering the estate and nothing has yet been paid out, you should prepare an account charge and discharge and send it out to the beneficiaries even if you do not charge any interim fee for the executry administration. This works almost every time and prevents people saying: “It is a year since my father died and I have not received a single penny of my entitlement. I don't know what the solicitors have done with the money.” Once again communication is the key to avoiding complaints about delays.
“I did not know what I was signing”
If at all possible, any deed falling to be signed by a client should be sent out to them by post, rather than you inviting them into your office to sign a deed they have never seen before. If this is not possible, email a copy out to them in advance, or if this is not possible then as a last resort give them a copy of the deed at the time of signing. Try to avoid asking them to sign a deed that they have not had an opportunity to read over in their own time. Asking them to read the deed in your office before signing it is not enough, as they might still feel that there is pressure on them to sign.
At all costs do not give the client the chance to say at some point in the future: “I was asked to sign a deed which I had never seen before and did not understand, therefore I am not regarding myself as being legally bound by it.”
The real strength of a legal business is in building up a connection with its clients to the extent that they come back again for future transactions and they are prepared to recommend your services to their relatives and work colleagues. Someone might telephone you and say: “My name is John Smith. You probably won't remember me. You bought my flat five years ago.” You reply: “Number 15 High Street? Yes I do remember you.” The clients are thrilled that you actually remember them. Some clients still find approaching a solicitor a rather daunting prospect, and if they can deal with someone they have dealt with before it makes things much easier.
For me, emails have to a great extent superseded letters and telephone calls as a means of communicating with clients and this is a positive thing. However an email to my way of thinking is a rather banal way of communicating and does not have quite the same impact as a letter sent through the post. As a result I try to an extent to personalise the email, sometimes by introducing humour into it or by drawing analogies with previous transactions and how they might indicate the likely course of the current transaction. I simply cannot resist an opportunity to say: “In over 42 years in the law this is only the second time I have come across such a thing.” This is a roundabout way of saying to your client that they are getting the benefit of your decades of experience.
Value for money
The definition of a cynic is someone who knows the price of everything and the value of nothing. On the question of exactly what the client is getting in return for the fees paid by them, it may be the case that only the older generation appreciate that the quality of service can vary from one firm to another and choosing a solicitor should not just be a case of taking the cheapest quotation available. When competitive fee quoting first came in many years ago I had someone telephone me for an estimate for the fees for buying a house and I quoted the full scale fee. He replied that another firm had quoted half of that figure and he was obviously expecting me to undercut this. I gained the impression that the caller was a journalist, and if I had risen to the bait he could have published an article saying that solicitors had at least 50% clear profit on their fees, as they could carry out transactions for less than half of the full fee and still make money.
“Tell them the deal is off”
Buying and selling property can be a very stressful time for clients. If problems are encountered the client’s frustration can boil over and they instruct you to contact the other side and “Tell them the deal is off.” A solicitor’s first priority is always to do their best for their client and, where problems have been encountered, to apply their experience in dealing with the detail of the matter, but at the same time keeping the wider picture in view so that the client can achieve their overall intentions and not end up in a situation where a great deal of time and effort has been expended with no positive result. In such a situation if you consider that the transaction can still be salvaged you should ask your client to give you more time to sort the situation out.
Where a transaction has foundered then for some inexplicable reason the client often does not come back to you with instructions to offer for an alternative property. They appear to get the impression that there is some sort of jinx on you and they just want to make a fresh start with another solicitor. This is another reason for trying to keep the original transaction going.
If you have a client involved in an adversarial matter, if they do not want to make a fight of it then do not waste any more time on them. Just reach the best compromise that you can in all the circumstances.
When the Russian tanks went into Czechoslovakia in 1968 to crush the Prague Spring, President De Gaulle of France said in exasperation: “What can you do to help a country which won't even defend itself?”
Spending the client's money for them
If a client is intending to offer for a property at a closing date they may well ask you how much beyond the home report or survey value they should offer to have the best possible chance of securing the property. The solicitor's answer to this should be “I cannot be generous with other people's money. Anything you offer beyond the basic survey value is entirely dependent on what resources you have available and how keen you are on this particular property. You have to make your own decision on this.” If the client's offer is successful and they end up suffering buyer's remorse, they will not be able to blame the situation on you.
I once offered for a property at a closing date and my offer came second. I later discovered that the top offer was £97,000 more than my offer. This left me wondering if the solicitor in question had any part in deciding how far their client should bid above the asking price.
If someone is recommended to you by an existing client you should consider sending an email or a letter to that client thanking them for the recommendation. Such recommendations do have their drawbacks, however, in that if problems are encountered in acting for the new client then not only will they not come back next time but you might end up losing the original client, so you need to monitor the situation carefully and make sure that the new client considers they are getting a first class service.
Attention to detail
Attention to detail is of vital importance in legal work, but on occasion you have to step back and look at the wider picture. Clients were intending to rent out their large west end house to an oil company, possibly for up to five years. We sent the oil company our draft lease for consideration but their solicitor then contacted us with a draft lease in their own house style.
On going over this draft there were one or two points which I was not 100% happy with, but I thought to myself: “If this lease runs for the full five year term the clients will lift £94,000 rent money from their house. Just get this deal closed as quickly as possible.” I pointed out my concerns to the clients, but the recommendation was that because the risk of these matters causing problems was remote the transaction should not be jeopardised by nitpicking and they should accept the terms of the lease.
Ashley Swanson is a solicitor in private practice in Aberdeen. His views are personal. Other readers are welcome to contribute their own experiences and tips.
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