“No person may leave the place where they are living without reasonable excuse”. Moving house where “reasonably necessary” is within the examples of what comes within the definition of reasonable excuse.
It could, for example, be considered “reasonably necessary” to move house during a lockdown in the following circumstances:
- Contracts have been exchanged, whether or not a fixed completion date is agreed;
- One party is refusing to consider postponing the move date;
- There is a chain of transactions and it would create particular practical and or personal difficulties for those in the chain to rearrange a completion date which they have been working towards, even though contracts have not yet been exchanged;
- It is practically unreasonable to delay completion, for example, because of acute personal circumstances, or adverse financial implications of postponing completion.
So where completion goes ahead, how do the parties protect themselves and others in view of the social distancing guidance? The Regulations state that “during the emergency period, no person may participate in a gathering in a public place of more than two people except… where reasonably necessary… to facilitate a house move”.
This means that while people can gather at some point as is necessary to facilitate completion day, such as removal staff, the implication is that social distancing should still be observed where possible. Clients must be advised reminded of the rules and the need to adhere.
The Regulations are helpful as far as they go, but the practicalities for solicitors and other conveyancing staff – not to mention the parties – may not be so straightforward. Every transaction is, of course, different; people’s needs are different – and most notably – conveyancers are now working remotely.
The government offered early advice around house moves and this has now been followed by much-needed industry guidance which practitioners will be appreciating.
First, on 24 March Michael Gove (minister for the Cabinet Office) advised the parties to put their sales/purchases on hold unless contracts had already been exchanged. But this raised issues particularly in relation to the execution of transfers.
Then, following a call by the Law Society for clarification, industry-wide guidance was issued on 30 March. This came from the Law Society, the Society of Licensed Conveyancers, the Chartered Institute of Legal Executives, Bold Legal Group and the Conveyancing Association. It makes clear, at the outset, that the priority is the health of individuals and the public and that nothing in the guidance should be read as contradicting that.
The guidance says practitioners should encourage clients to agree an appropriate deferral and to advise them to proceed only if that has proved impossible.
It makes the valid point that conveyancers should try to “avoid allegations, however unjustified, that the conveyancing profession is encouraging its clients to carry out transactions against the spirit as well as the letter of government requirements”. But if, after you’ve advised your client about deferring, clients give written instructions to proceed, then if it’s legally possible to do so, you must follow those instructions. It is likely to prove a challenge, in some cases, balancing the statutory expectations and client expectations.
The guidance also provides useful practical help including:
- How best to amend existing contracts
- Advice for clients who have already exchanged contracts
- Advice for those who have not exchanged contracts
- Advice for clients who have to move during the lockdown
The issue of how best to amend existing contracts is likely to arise frequently during the lockdown. To that end, a draft clause has been agreed outlining the process for deferring a completion date, though with every situation and transaction being different, a one-size-fits-all approach should not be taken.
Essentially, contracts must be amended by way of a written agreement varying the terms and formally re-exchanged. To avoid contamination from physical documents, the parties should e-sign the agreement to vary the existing contract or authorise their conveyancer to sign it on their behalf. The guidance suggests a two-step process to delay the move until the end of the lockdown period, with the ability to extend the timescale if restrictions are extended.
Where undertakings have been given, these will need to be altered to the effect that the original document will be sent when the Covid-19 restrictions are lifted.
Important ancillary issues will need to be considered, for example, whether any formal confirmation from a lender extending a mortgage offer is required; renewing any searches; and the implications for a completion if a seller (or purchaser) has died in the meantime.
Simon Davis, president of the Law Society, said the Society “recognises the real difficulties faced by those who are trying to move home, particularly for those who have exchanged contracts, but are not able to complete, for a variety of reasons created by the restricted movement requirements. The guidance from the government, and that produced by the Law Society in conjunction with other conveyancing bodies, is our attempt to offer some solutions in these exceptional circumstances. There are no simple solutions and the position is one that is fluid and changing. We will keep it under review and if necessary step in again”.
Paul Smee, chair of the Conveyancing Association, goes further and said: “At present, home moves should not be contemplated unless the need to move is critical. So, this guidance only applies to cases where contracts have already been exchanged and the parties involved have been unable to agree on a delay in completion.
“It outlines the relevant requirements that have been put in place by the government to counter the spread of the virus, and what conveyancers need to do to work within them. Home moves can only occur where it is safe for them to do so. Some cases will have special features on which specific advice will be needed and home buyers and sellers should always talk to their conveyancer.”
The guidance can be found here.