Introduction and Key Elements of Freehold Property Transactions — Property Law and Practice SQE1

Introduction

This chapter introduces the key elements and structure of freehold property transactions in residential conveyancing. It explains how a solicitor investigates title to both registered and unregistered freehold land — analysing Land Registry official copy entries (the property, proprietorship and charges registers) and, for unregistered land, an epitome of title founded on a good root of title. It then covers the pre-contract searches and enquiries the buyer's solicitor must make, the role of the Law Society Conveyancing Protocol, and the professional conduct considerations under the SRA Standards and Regulations that govern who a solicitor may act for in a property transaction.

Assessment focus

For SQE1 you must be able to apply the rules on investigation of title, searches and professional conduct to realistic client scenarios. Key examinable points include: the requirement for a good root of title at least 15 years old in unregistered land; the content of the three Land Registry registers; the function of the principal pre-contract searches (Local Authority Search LLC1 & CON29, Environmental, Water and Drainage CON29DW, Chancel Repair, Index Map, Land Charges K15); the caveat emptor principle; the Law Society Conveyancing Protocol; and the conflict of interest rules under paragraph 6 of the SRA Codes of Conduct (acting for seller and buyer, borrower and lender, joint borrowers — including the Royal Bank of Scotland v Etridge (No 2) guidelines), contract races and undertakings. Questions are single best answer (SBAQ); this is a closed-book assessment.

Study tips

1) Memorise that a good root of title must be at least 15 years old, give an adequate description of the property, be unconditional, in proper form and show an unbroken chain of ownership. 2) Learn the three registers — property (description, estate, benefiting easements/covenants), proprietorship (class of title, proprietor, price, restrictions), charges (burdens: covenants, easements, mortgages). 3) Remember official copies more than 12 months old should not be accepted, because Land Registry will not perform the pre-completion search on them. 4) Know the caveat emptor principle: the buyer's solicitor must make the searches; the seller need only disclose latent defects in title, not physical defects. 5) For conduct, master para 6.2 (substantially common interest / competing for the same objective) and why neither exception lets one solicitor act for both buyer and seller for value, and the Etridge guidelines for joint borrowers.

1. Investigation of a Registered and Unregistered Freehold Title

The investigation of title, whether registered or unregistered, is a fundamental aspect of freehold property transactions. It involves a thorough analysis of Land Registry official copy entries, an epitome of title, and deducing ownership. This process is crucial to identify any potential issues that could arise, requiring further action, and to report to the client effectively.

Registered Land and Unregistered Land

Registered Land. The Land Registry keeps a register of all registered land. Each property is given a unique number that is used to identify the property. The Land Registry will also keep an individual register for the property which includes information about the property, information about the ownership and information regarding any mortgages or charges over the property. This is collectively referred to as the title information. As the register for the property is updated any time an event happens that affects the property, it becomes a useful tool for conveyancers as all the information is at their fingertips. The Land Registry charges a small fee for access to each property's register.

Unregistered Land. Unlike registered land, there are no details recorded centrally to show the information surrounding an unregistered property. A search will be performed via the Land Registry by the conveyancer to identify whether the land in question is registered or unregistered. If the property is unregistered, no information will be held about the property, including who the owner of the land is. When it comes to unregistered land, the owner must demonstrate their ownership of the property through what is called a 'root of title'. This will provide information about the property going back at least 15 years and hopefully showing the transfer of the property into the current owner's name. It is very important to keep the deeds of unregistered property safe as these will be vital in showing a good root of title and providing the conveyancer with important information regarding the property.

A Good Root of Title

Good Root of TitleA good root of title is a document that is adequate evidence of the ownership of property and from which a buyer can trace a good title. The legal basis for this concept primarily comes from the practice and conventions of conveyancing rather than from a specific statutory provision.

Legal Basis and Requirements. Traditionally, a good root of title was considered to be a document that met the following requirements:

Adequate Age — the document should be at least 15 years old at the date of the conveyance. This is based on the general principle that title deeds within the last 15 years should be sufficient to establish a good title.

Description of Property — it must give an accurate and adequate description of the property being sold to enable identification.

Unconditional — the document should not refer to any conditions or contingencies that affect the title.

Proper Form — the document should be properly executed, valid, and effective in conveying the interest it purports to convey.

Chain of Ownership — there must be an unbroken chain of ownership from the date of the root document to the present, with each transaction in the chain being properly documented and lawful.

The purpose of having a good root of title is to give the buyer confidence that the seller has a proper and marketable title to the property and that there are no defects in the chain of ownership that might emerge to challenge the buyer's ownership in the future.

Key point

The importance of a good root of title has diminished with the system of land registration. When property is registered, the Land Registry holds details of the title, which simplifies the conveyancing process and reduces the necessity to prove a good root of title. However, the concept still remains relevant for unregistered land or when dealing with certain complex title issues even on registered land.

2.1.1 Key Elements and Structure of Freehold Property Transactions

Freehold property transactions involve a systematic process of investigation. In the case of registered land, the Land Registry maintains a register of all registered properties, each with a unique number and individual register containing information about the property, its ownership, and any mortgages or charges over the property. This register is updated anytime an event occurs that affects the property, making it a valuable tool for conveyancers. For unregistered land, no central records exist, and the owner must demonstrate ownership through a 'root of title' going back at least 15 years.

Key point

Two milestones (key stages) in a conveyancing transaction: exchange of contracts and completion. Completion is the stage when the bulk of the purchase money is paid to the seller and the transfer deed is completed to transfer the property to the buyer.

Around these two milestones are the following three stages:

(a) the pre-contract stage;

(b) the post-contract stage; and

Assuming that matters proceed smoothly, the pre-contract stage of a residential transaction may take four to six weeks from the date when instructions are first received. The post-contract stage may then be much shorter, often no longer than two weeks, and the post-completion stage represents the 'tidying up loose ends' process after the buyer has bought the property. This only applies to second-hand properties, assuming it is a high street lender or cash buyer. The procedure for plot sales differs.

2.2.2 How to Investigate Title to Freehold Registered Land?

The buyer's investigation of title will involve two main elements. Firstly, title will be deduced by the seller in the form of official copies of the entries on the register and the title plan, and so a thorough examination of these must be undertaken. Secondly, the buyer needs to carry out investigations to discover if there are any overriding interests affecting the property, as such interests will bind the buyer even though the register contains no mention of them.

Key point

Having made the investigation of title, the buyer must carry out certain checks before completion to update the information revealed. Part of this process involves carrying out a search at Land Registry to confirm that no new entries have been added to the register since the official copies were issued. Land Registry will not perform this search on official copies that are more than 12 months old, and so, when title is deduced, a buyer should not accept official copies that are outside, or close to, this 12-month time limit.

2.2.3 Process of Analysing Land Registry Official Copy Entries

The property register, the proprietorship register, and the charges register are the particular issues that the solicitor should look out for when examining the official copies and title plan.

The Property RegisterDescribes the property with a brief property description and a reference to the title plan. It also states the estate held (i.e. freehold or leasehold estate). The Property Register may also include any easements or covenants which exist for the benefit of the property (e.g. if the property benefits from a right of way over neighbouring land).

The Proprietorship RegisterStates the class of title, the name and address for service of the registered proprietor and the price they paid for the property (since April 2000) and any limitations on the registered proprietor's powers to deal with the property (for example, if they need their mortgage lender's permission before transferring the property).

The Charges RegisterContains details of any burdens affecting the property, such as restrictive covenants (e.g. restrictions on the use of the property), positive covenants (e.g. obligations to maintain a fence or driveway), easements and mortgages.

The Three Land Registry Registers

Register	Principal contents
Property Register	Brief property description; reference to the title plan; the estate held (freehold/leasehold); easements or covenants benefiting the property.
Proprietorship Register	Class of title; name and address for service of the registered proprietor; price paid (since April 2000); restrictions/limitations on powers to deal with the property.
Charges Register	Burdens affecting the property: restrictive covenants, positive covenants, easements and mortgages.

2.1.4 Process of Analysing an Epitome of Title and Deducing Ownership

In unregistered land, title is deduced in the form of an abstract or epitome of title. The epitome must commence with a good root of title at least 15 years old. A good root of title is a document that is at least 15 years old, deals with or shows the ownership of the whole legal and equitable interest contracted to be sold, contains a recognisable description of the property, and contains nothing to cast any doubt on the title.

2.1.4.1 Purpose of Epitome of Title

The epitome of title serves several purposes:

Evidence of Ownership — it demonstrates the seller's ownership of the property and their right to sell it.

Chain of Title — it shows an unbroken chain of ownership, detailing each transaction leading up to the current ownership.

Disclosures — it discloses any covenants, easements, or other rights and burdens affecting the property.

Due Diligence — it allows the buyer to carry out due diligence, ensuring they are aware of all material facts before committing to the purchase.

Legal Implications:

Title Defects — if the epitome of title reveals any defects in the title (e.g. breaks in the chain of ownership or undisclosed encumbrances), it can affect the marketability of the property.

Remedies and Indemnities — the buyer might seek remedies or indemnities from the seller if any issues are discovered.

Completion of Sale — a satisfactory epitome of title is often a condition precedent for the completion of a sale.

2.1.4.2 Contents of an Epitome of Title

Typically, an epitome of title will include:

Abstract of Title — a narrative summary of the deeds and documents comprising the title.

Title Deeds — copies of the actual deeds and documents that convey the property from one owner to another.

Search Results — results of various searches, like local authority, drainage, and environmental searches.

Property Information Forms — completed by the seller, providing detailed information about the property.

Planning Documentation — including planning permissions, building regulation approvals, and any related correspondence.

Leases and Tenancy Agreements — if the property is let or part of it is let.

Licences and Covenants — any licences that have been granted and details of covenants affecting the property.

Indemnity Policies — if there are any known defects, indemnity policies may be put in place.

Key Notes for Section 2.1: ① Registered land has a centrally held register with a unique number; unregistered land relies on a root of title at least 15 years old. ② A good root of title must be ≥15 years old, give an adequate description, be unconditional, in proper form and show an unbroken chain. ③ The three registers are property, proprietorship and charges. ④ Watch for overriding interests (bind the buyer though not on the register) and do not accept official copies more than 12 months old. ⑤ Unregistered title is deduced by an epitome of title commencing with a good root.

2. Issues from an Investigation of Title and Reporting to the Client

Several issues might be revealed in an investigation of title, such as easements, mines and minerals reservations, and declarations as to rights of light and air. These issues could potentially affect the buyer's use and enjoyment of the property in the future. Therefore, further action — such as making enquiries using CON29 to find out more about future and previous mining operations, or raising enquiries with the seller — may be necessary.

2.1.5 Issues That Could Arise and Further Action Required

EasementAn easement confers the right to one landowner to use the land of another in some way, or to prevent it being used in a certain way. Examples are a right of way (the right to cross the land of another).

Further action (easement): enquiries should be made of the sellers about the exercise of this right and whether any disputes have arisen in respect of it. The client will also need to be informed and asked whether it would cause concern.

Mines and minerals reservations. If mining seems to have occurred on the land, there is a risk of subsidence or damage to the property. The property value might decrease in light of this. If mining activities were to resume, there could also be an impact on the property value.

Key point

Further action (mines and minerals): a solicitor should make enquiries using CON29 to find out more about future and previous mining operations. A solicitor should also raise enquiries with the seller as to any previous mining activities and any damage caused to the property consequently.

Declaration as to rights of light and air. There could be a problem with the buyer's use and enjoyment of the property in the future, as they have no easement to prevent development nearby removing light/air. A solicitor should identify the surrounding land which could be developed and the identity of the owners, so that the client can assess the likelihood of development adversely affecting light to the property in the future (e.g. light might be desired for office-space, a greenhouse, etc.).

2.1.5.1 Co-ownership

Co-ownership arises whenever two or more people have simultaneous concurrent interests in land. The solicitor would need to check the proprietorship register for a restriction to establish whether they own as beneficial joint tenants or tenants in common.

Joint TenantsJoint tenants are all equally entitled to the whole property and do not have individual shares. If the property is sold, they are entitled to share the sale proceeds equally. A crucial characteristic of a joint tenancy is the 'right of survivorship': when a joint tenant dies, his interest automatically accrues to the remaining joint tenants.

Tenants in CommonWhere the equitable interest is held as tenants in common, the right of survivorship does not apply and, on the death of one of the co-owners, the equitable interest passes under the will or intestacy of the deceased co-owner. Tenants in common may hold equal or unequal shares in equity.

2.1.5.2 Covenants

Negative (Restrictive) CovenantsNegative (or restrictive) covenants limit the use of the land in some way and do not require positive acts to secure compliance. Such burden is transferred to a new owner, and therefore the buyer should be made aware of its existence, as he will be bound by it.

For example, there may be a covenant affecting the land prohibiting the owner from creating a nuisance which, given that the buyer wishes to carry out substantial building works on the property, may be a problem. There is the possibility of approaching the party with the benefit of the covenant. If you could work out which land has the benefit of the covenant and who now owns that property, you could approach them and ask if they could release the covenant, modify it, or give consent to the works proposed by the buyer.

Positive CovenantsPositive covenants are characterised by requiring active steps to secure compliance (e.g. maintaining a fence, or any structure on the property). The burden of a positive covenant does not run with the land even if it is on the register. The burden could be enforced indirectly via an indemnity chain or as a compulsory renewed covenant.

Key point

Positive covenants — practical effect: If there is no indemnity chain in place, the buyer can ignore the covenant without fear of the consequences. However, the buyer would be liable for breach of the positive covenant if there was a chain of indemnity covenants in existence or a restriction requiring a deed of covenant.

2.1.5.3 Mortgages, Unilateral Notices and Home Rights

MortgageA mortgage is a transaction where the borrower ('mortgagor') borrows money from the lender ('mortgagee') and transfers to the lender, as security for the loan, a legal or equitable interest in land.

Further action (mortgage): the buyer's solicitor must ensure the contract makes clear the property is not being sold subject to the mortgage. Also, the buyer's solicitor should ask for confirmation that the mortgage will be discharged on or immediately after completion.

Unilateral NoticeA unilateral notice indicates that there is a dispute over a right or interest in the land. This could be an issue for the buyer as it will prevent the sale of the property.

Further action (unilateral notice): the first step is to ask the seller's solicitor to ascertain to what the unilateral notice relates. Then there are several courses of action available to the buyer: one is simply to walk away from the transaction, or to refuse to proceed any further until the seller deals with the unilateral notice. In any event, a buyer will realistically not want to commit to the transaction until the matter has been dealt with. The buyer should require the seller to get the notice withdrawn or cancelled.

Home Rights (Family Law Act 1996)The Family Law Act 1996 ('FLA 1996') gives statutory rights of occupation (called 'home rights') to the non-owning spouse or civil partner. If the spouse or civil partner is in occupation of the matrimonial home, he has a right not to be excluded from it without a court order.

A registration under the FLA 1996 can be removed on production of one of the following:

an application made by the person with the benefit of the rights;

a final order (formerly 'decree absolute') of divorce, or a dissolution order, ending the marriage or civil partnership;

a court order for removal of the charge;

the death certificate of the spouse or civil partner.

2.1.6 Purpose and Process of Reporting to the Client

The purpose of reporting to the client is to keep them informed about the findings of the investigation of title, any potential issues identified, and the recommended further actions. The process involves a clear and concise presentation of the information gathered, explaining its implications, and providing advice on the next steps. This report is crucial in helping the client make informed decisions about the property transaction.

Key Notes for Section 2.2: ① Easements — enquire of disputes; inform the client. ② Mines and minerals — use CON29 and raise enquiries with the seller. ③ Rights of light/air — identify developable surrounding land. ④ Co-ownership — check the proprietorship register for a restriction: joint tenants (right of survivorship) vs tenants in common (no survivorship). ⑤ Restrictive covenants bind the buyer; positive covenant burdens do not run (liability only via an indemnity chain). ⑥ Mortgages must be discharged on completion; unilateral notices must be withdrawn/cancelled; home rights under FLA 1996 must be released.

3. Pre-Contract Searches and Enquiries

Pre-contract searches and enquiries are a crucial part of the conveyancing process. They provide essential information about the property, which can influence the buyer's decision to proceed with the transaction and the terms of the contract.

The Pre-Contract Package and Caveat Emptor

Having taken instructions, the seller's solicitor must prepare the pre-contract package for the buyer. This comprises: the draft contract, showing what land the seller is selling and on what terms he is prepared to sell it; evidence of the seller's legal title to the property, to prove that he does own and is entitled to sell the land; and sometimes, the results of pre-contract searches which the seller has made and other information about the property. The package may also include items such as copy local authority planning permissions, which the buyer's solicitor will want to see to make sure the property was permitted to be built on the site.

Key point

Caveat emptor ('let the buyer beware'). Although the seller has a limited duty to disclose defects in his legal title (but not physical defects), the caveat emptor principle applies to conveyancing, so that it is the buyer's responsibility to find out all the information which he needs to know about the property before committing himself to the purchase.

2.2.1 Range and Purpose of Making Searches and Raising Enquiries

The range of searches and enquiries made will depend on the property and its location. However, common searches include:

Local Authority Search (LLC1 & CON29) — provides information about the property from the local council's records, including planning permissions and building control history.

Environmental Search — identifies potential environmental risks, such as flooding or land contamination.

Water and Drainage Search (CON29DW) — confirms the property's connection to public water supply and drainage.

Chancel Repair Search — identifies whether the property could be liable for contributions towards the repair of a local church.

Index Map Search — confirms whether the land is registered or unregistered.

Land Charges Search (K15) — reveals any charges or restrictions against the property.

Additional searches may be required depending on the property's location and specific circumstances, such as mining searches or flood risk reports.

Common Pre-Contract Searches

Search	Purpose / What it reveals
Local Authority Search (LLC1 & CON29)	Information from the local council's records — planning permissions and building control history.
Environmental Search	Potential environmental risks — flooding or land contamination.
Water and Drainage Search (CON29DW)	Confirms connection to public water supply and drainage.
Chancel Repair Search	Whether the property could be liable for contributions to repair of a local church.
Index Map Search	Confirms whether the land is registered or unregistered.
Land Charges Search (K15)	Reveals any charges or restrictions against the property.

2.2.2 Who Would Make the Searches and Raise Enquiries

The buyer's solicitor or conveyancer typically carries out the searches and raises enquiries. They will contact various organisations, such as the local authority, the Land Registry, and utility companies, to gather the necessary information.

2.2.3 Results of Searches and Enquiries

The results of searches and enquiries can reveal important information about the property, such as:

Planning Restrictions — the Local Authority Search can reveal if the property is in a conservation area or if it is a listed building, which could restrict future development.

Legal Obligations — searches can reveal if there are any covenants or easements affecting the property.

Financial Liabilities — the Land Charges Search can reveal if there are any charges or restrictions against the property, which could affect its value or the buyer's ability to secure a mortgage.

Environmental Risks — the Environmental Search can reveal potential environmental risks, such as flooding or land contamination, which could affect the property's value and insurability.

Key point

It is essential that a search of the register of local land charges is made in every transaction. Local land charges are financial charges or restrictions on land that have been imposed by public authorities under statute.

Matters revealed by the local land charges result may include the following:

financial charges (e.g. for adoption of estate roads);

tree preservation orders (which prevent the protected tree(s) being felled without permission);

smoke control orders (which restrict the use of non-smokeless fuels in domestic fireplaces);

some compulsory purchase orders (which make it lawful for an acquiring authority to take steps to acquire the land without the owner's consent);

planning permissions granted;

any restrictions on permitted development (e.g. 'Article 4 Direction');

orders revoking or modifying planning permissions;

conservation area designation orders made since 31 August 1974 (orders made prior to that date will be revealed by the replies to the enquiries of the local authority (CON29));

listed building status (this can also be checked with Historic England via the National Heritage List for England, particularly if the property may have been recently listed, as the local authority may not yet have made an entry on the local land charges register).

The buyer should be advised of the entries affecting the property and their significance — for example, in the case of a tree preservation order, that the tree in question cannot be felled or lopped without permission. Where a planning permission has been revealed, the seller should be required to produce copies (failing which, the buyer's solicitor can obtain copies from the local authority at extra cost) so that the buyer's solicitor can check that the client's proposed use is the authorised use for planning purposes and that there are no conditions in the planning permission which might interfere with that use. If financial charges are revealed, the seller should be requested to discharge these prior to completion, or to reduce the purchase price accordingly.

2.2.4 Taking Instructions on Domestic Conveyancing

When taking instructions on domestic conveyancing, it is crucial to gather comprehensive information from the client. This process forms the foundation for the entire transaction and is often the starting point for analysing multiple-choice questions in the SQE exam.

Client Identification — obtain proof of your clients' identity. This is a critical step due to money laundering regulations and ongoing sanctions against certain interests.

Confirm Instructions — confirm any instructions passed to you by estate agents directly with your client.

Client and Property Details — take details of your clients' full names, property address, price agreed, details of all fixtures and fittings, whether the property is occupied, its current use, possible completion dates, whether this is a chain transaction with dependent sales and purchases, and whether a mortgage will be required.

Mortgage and Survey Details — ascertain whether steps have been taken to secure a mortgage offer and whether your clients intend to arrange for a full structural survey.

VAT and CGT — confirm whether VAT is to be charged and whether there will be a Capital Gains Tax (CGT) liability.

Title Documents and Funds — ensure that you are put in funds to commence searches and check the whereabouts of any title documents.

Key Notes for Section 2.3: ① The seller's solicitor prepares the pre-contract package (draft contract, evidence of title, sometimes search results). ② Caveat emptor — the buyer must investigate; the seller discloses only latent title defects, not physical defects. ③ Memorise the six common searches and their references. ④ A local land charges search is essential in every transaction. ⑤ The buyer's solicitor carries out the searches. ⑥ On taking instructions, address identity (AML), property details, mortgage/survey, VAT/CGT, funds and title documents.

4. Law Society Conveyancing Protocol

The Law Society Conveyancing Protocol is a comprehensive guide that provides a framework for practitioners involved in the sale and purchase of a home for an owner-occupier. It is not applicable for new builds. The protocol outlines the stages of a transaction — initial instructions, pre-exchange negotiations, exchange of contracts, completion, and post-completion matters — from both the buyer's and seller's perspectives. It also covers a conveyancing solicitor's professional obligations.

The protocol is designed to streamline residential conveyancing and provide a consistent approach across the profession. It sets out the best practice for conducting the conveyancing process and aims to improve communication and efficiency between all parties involved. It is divided into several sections, each addressing a specific stage of the conveyancing process:

Initial Instructions — outlines the information that should be obtained from the client at the outset, including their identity, the property details, and any instructions passed on by estate agents.

Pre-Exchange Negotiations — provides guidance on how to handle negotiations before the exchange of contracts, including how to deal with any issues that may arise during the investigation of title.

Exchange of Contracts — details the process of exchanging contracts, including the information that should be confirmed before the exchange and the steps to take after the exchange.

Completion — outlines the steps to take on the day of completion and the post-completion procedures, such as registering the change of ownership with the Land Registry.

Professional Obligations — covers the solicitor's professional obligations throughout the conveyancing process, including their duty to act in the best interests of their client and to maintain confidentiality.

Key point

Conveyancing Quality Scheme (CQS). All firms that undertake residential conveyancing and want to be members of The Law Society's Conveyancing Quality Scheme ('CQS') are required to sign up to comply with the Protocol, a Client Service Charter, and mandatory training and enforcement procedures. Where the Protocol is used, the standard form of pre-contract enquiries to the seller for a freehold property is the Property Information Form ('TA6').

Membership of CQS is essential for any firm wanting to be on the panels of solicitors approved by residential mortgage lenders to act for lenders where the buyer is taking out a residential mortgage. The procedures laid down by the Protocol are intended to regulate the relationship between the seller's and buyer's solicitors, and do not affect dealings with third parties such as estate agents or lenders. Broadly speaking, the requirements of the Protocol reflect what is already standard practice within the profession, and no special procedures are involved. Even if the parties have not formally chosen to adopt its use, they may well use the TransAction forms in any event.

Key Notes for Section 2.4: ① The Protocol is a framework for residential sale and purchase of a home for an owner-occupier; not for new builds. ② It covers the full transaction and the solicitor's professional obligations (client's best interests, confidentiality). ③ It standardises residential conveyancing for firms that adopt it. ④ CQS membership requires compliance with the Protocol and is essential for lender panel membership; the freehold pre-contract enquiry form is the TA6 Property Information Form.

5. Professional Conduct Considerations in Property Transactions

The conduct of solicitors is regulated by the Solicitors Regulation Authority (SRA) through the Code of Conduct for Solicitors. Similarly, the conduct of law firms is governed by the Code of Conduct for Firms, collectively referred to as the 'SRA Codes'. Non-compliance may result in the SRA initiating regulatory action against the acting solicitor, the law firm as a corporate entity, or its managers or compliance officers.

The SRA Standards and Regulations encapsulate the 'SRA Principles', which include mandates such as acting with integrity and prioritising the best interests of each client. These Principles form the foundation of the entire SRA Standards and Regulations, inclusive of the Code of Conduct. The regulations most pertinent to conveyancing practice are encapsulated in Paragraph 6 of the Code of Conduct, which addresses the critical issues of conflicts of interest and confidentiality.

2.4.1 Acting for Seller and Buyer

Occasionally, the parties to a conveyancing transaction ask if one solicitor or one firm can act for both parties. According to Paragraph 6.2 of the SRA Codes and Principle 7, solicitors do not act if there is a conflict of interest or a significant risk of such a conflict, as there is a separate duty to act in the best interests of each client. Law Society guidance also states that 'there is a high risk of a conflict of interest if you act for both a buyer and a seller'. However, the solicitor can act for both parties only if one of the two exceptions in para 6.2 applies:

Para 6.2(a) — substantially common interest. A solicitor can act for more than one party if the clients have a 'substantially common interest'. However, Law Society guidance states that this exception 'does not apply to a property purchase because they also have different interests'. Although both clients have a common interest in completing the sale, they also have different interests, since one is buying and one is selling.

Para 6.2(b) — competing for the same objective. A solicitor can act for more than one party if the clients are competing for the same objective. However, this cannot apply to a seller and buyer, as they are not competing for the same asset and therefore do not satisfy the definition of 'competing for the same objective'.

Key point

A solicitor or firm may only act for both parties in the rare instances where an exception applies. This will be difficult to establish where the land is transferred for value. It might be possible to act, for example, where the land is being gifted, or transferred between parties related by blood, adoption, marriage, civil partnership or living together. If a conflict arises during a transaction or they cease to share a substantially common interest, the solicitor must stop acting for at least one client, and could only continue acting for the other if the duty of confidentiality to the former client is not at risk. Overall, a solicitor may not act for both parties because there is an existing conflict of interest.

2.4.2 Acting for Joint Buyers

It is usually acceptable to act for joint buyers, provided that no conflict of interest exists or is likely to arise. It may be necessary to advise residential buyers separately about their rights in the property, particularly where the prospective joint buyers are not married to each other nor in a civil partnership.

2.4.3 Acting for Borrower and Lender

Law Society guidance issued in June 2020 indicates that it may be acceptable to act for both borrower and lender where the mortgage is on standard terms. In residential transactions, the borrower will often be borrowing from a bank or building society where the mortgage is offered on standard terms and conditions, because the terms are not negotiated between the lender's and borrower's solicitors. Therefore, it will often be possible to act for both buyer and lender in a residential transaction if the mortgage is on standard terms. However, acting for borrower and lender on a commercial transaction presents a high risk of conflict, and they are often separately represented because the mortgage documents are likely to be the subject of significant negotiation.

Acting for Borrower and Lender — Residential v Commercial

Residential transactions	Commercial transaction
The borrower will often be borrowing from a bank or building society where the mortgage is offered on standard terms and conditions. It will often be possible to act for both buyer and lender in a residential transaction if the mortgage is on standard terms.	Acting for borrower and lender on a commercial transaction presents a high risk of conflict. The lender will usually be represented separately because the mortgage documents are likely to be the subject of significant negotiation.

2.4.4 Acting for Joint Borrowers

If no conflict of interest exists, there is no rule of law or conduct which prevents the same solicitor acting for joint borrowers. However, problems can arise where, for example, a husband needs to borrow money for his business and the bank requires security, but the only asset is the matrimonial home in the joint names of the husband and wife. If the wife agrees to a mortgage for the benefit of her husband's business but the husband defaults, the bank may seek to enforce its security to the wife's detriment. In such circumstances, the wife may seek to have the mortgage set aside on the basis of undue influence.

Key point

The Etridge guidelines. A solicitor should follow the guidelines laid down in Royal Bank of Scotland plc v Etridge (No 2) [2001] UKHL 44, [2002] 2 AC 773 if acting in such a situation. The solicitor should:
(i) explain to the wife the purpose for which the solicitor has become involved;
(ii) explain that the lender will rely on the solicitor's involvement to counter any suggestion that the wife has been unduly influenced or has not fully understood the nature of the transaction; and
(iii) obtain confirmation from the wife that she wishes the solicitor to act for her and to advise her on the legal and practical implications of the transaction.

It must be clearly explained to the wife that she has a choice as to whether or not to go ahead, emphasis being placed on the fact that the choice is hers and hers alone. The solicitor's discussion with the wife should take place at a face-to-face meeting in the absence of the husband, and the advice should be given in non-technical language. It is not for the solicitor to veto the transaction, but if the solicitor thinks that the transaction is not in the wife's best interests, they should give reasoned advice to that effect.

2.4.5 Contract Races

Contract RaceA contract race occurs when a seller enters into the conveyancing process with two or more prospective buyers at the same time. The buyers are competing with each other, and the winner of the race is the buyer who is ready to exchange contracts first.

Key point

If the seller intends to 'deal' with more than one buyer at the same time, the seller's solicitor is required to inform all buyers immediately to comply with paragraphs 1.2 and 1.4 of both SRA Codes of Conduct. If the seller refuses to allow the solicitor to notify all prospective buyers, the solicitor cannot disclose the contract race because of the duty of confidentiality under para 6.3. Instead, if they consider that paras 1.2 or 1.4 would be breached by the non-disclosure, they must decline to act to avoid breaching Principle 5 (acting with integrity).

2.4.6 Undertakings

UndertakingAn undertaking is a statement, made by a solicitor or their firm, that the solicitor or firm will do something or cause something to be done. A solicitor is not obliged to give or accept undertakings, but there will be many situations in conveyancing where one will be asked to give an undertaking on a client's behalf — for example, that the seller's solicitor will discharge the client's mortgage over the property.

Key point

If a solicitor gives an undertaking, he must perform it within the agreed timescale (paragraph 1.3 of both Codes of Conduct). An undertaking is binding even if it is to do something outside your control, so it should not be given unless the solicitor can be sure it will be kept. Failure to honour an undertaking can be sued upon personally, is also a breach of professional conduct, and the solicitor can be disciplined by the SRA.

Key Notes for Section 2.5: ① Para 6 of the SRA Codes governs conflicts and confidentiality. ② A solicitor may not act for both seller and buyer (neither para 6.2(a) substantially common interest nor 6.2(b) competing for the same objective applies to a sale for value). ③ Joint buyers/borrowers are usually acceptable if no conflict; for at-risk spouses follow RBS v Etridge (No 2). ④ Borrower and lender — usually acceptable in residential (standard terms), high conflict risk in commercial. ⑤ Contract races must be disclosed to all buyers (paras 1.2/1.4) or the solicitor must decline to act. ⑥ Undertakings are binding even if outside your control; breach is personally actionable and a disciplinary matter.

6. Key Notes (Chapter Summary)

The following summary table consolidates the key items, concepts and references examined in this chapter. Treat it as a revision checklist for the SQE1 assessment of freehold property transactions.

Chapter 2 — Key Notes Summary

Key Items	Concepts	Cases / References
SRA's Transparency Rules 2018	Requires firms to publish price and service information for certain areas of law, including residential conveyancing.	SRA's Transparency Rules 2018
Pre-contract Searches and Enquiries	Provide essential information about the property, which can influence the buyer's decision to proceed and the terms of the contract.	Local Authority Search (LLC1 & CON29), Environmental Search, Water and Drainage Search (CON29DW), Chancel Repair Search, Index Map Search, Land Charges Search (K15)
Law Society Conveyancing Protocol	Provides a framework for practitioners involved in the sale and purchase of a home for an owner-occupier.	Conveyancing Quality Scheme (CQS); TA6
Professional Conduct Considerations	The conduct of solicitors is regulated by the SRA through the Code of Conduct for Solicitors.	SRA Code of Conduct for Solicitors; SRA Code of Conduct for Firms; RBS plc v Etridge (No 2) [2001] UKHL 44, [2002] 2 AC 773

7. MCQ Practice — SQE-Style Questions

Each of the following questions mirrors the style and difficulty of the SQE1 single best answer questions. Attempt each question closed-book, write down your answer, then turn to the answer key. The answer key explains why each option is correct or incorrect — read every explanation in full.

Question 1

John, a first-time homebuyer, is in the process of purchasing a property. His conveyancer is conducting an investigation of title. The property is unregistered, and the conveyancer is trying to establish a good root of title. Which of the following statements is true regarding this scenario?

A. The conveyancer needs to provide information about the property going back at least 10 years.

B. The conveyancer can establish a good root of title with a document that is at least 10 years old.

C. The conveyancer needs to provide information about the property going back at least 15 years.

D. The conveyancer can establish a good root of title with a document that is at least 20 years old.

E. The conveyancer can establish a good root of title with any document, regardless of its age.

Answer & explanation

Answer: C.
C is correct — in unregistered land, the owner must demonstrate ownership through a 'root of title' providing information about the property going back at least 15 years, ideally showing the transfer of the property into the current owner's name. A good root of title is a document that is at least 15 years old, deals with the whole legal and equitable interest, contains a recognisable description, and casts no doubt on the title.
A and B are incorrect — the period is 15 years, not 10.
D is incorrect — the document need only be at least 15 years old; 20 years is not the requirement.
E is incorrect — age matters: the root must be at least 15 years old. (See Section 2.1.)

Question 2

John is purchasing a property in a coastal town. His solicitor, Sarah, has received the pre-contract package from the seller's solicitor and is preparing to conduct pre-contract searches and enquiries. Which of the following actions should Sarah take to ensure John is making an informed decision?

A. Rely solely on the information provided by the seller's solicitor as it is their responsibility to disclose all relevant information about the property.

B. Conduct a Local Authority Search to obtain information about the property from the local council's records, including planning permissions and building control history.

C. Ignore the Environmental Search as the property is located in a coastal town and therefore unlikely to be subject to environmental risks such as land contamination.

D. Skip the Chancel Repair Search as it is an outdated practice and no longer relevant in modern conveyancing.

E. Avoid conducting a Land Charges Search as it is the seller's responsibility to reveal any charges or restrictions against the property.

Answer & explanation

Answer: B.
B is correct — in the conveyancing process the buyer's solicitor is responsible for conducting pre-contract searches and enquiries, because the principle of caveat emptor ('let the buyer beware') applies. A Local Authority Search is a common and essential search providing important information about the property.
A and E are incorrect — they misrepresent the responsibilities of the buyer's and seller's solicitors; under caveat emptor the buyer must investigate.
C is incorrect — it underestimates the relevance of an Environmental Search (a coastal location does not remove contamination/flooding risk).
D is incorrect — the Chancel Repair Search remains relevant. (See Section 2.3.)

Question 3

John, a solicitor, is working on a residential conveyancing case. His client, Mr Smith, is selling his property to Mrs Johnson. Both Mr Smith and Mrs Johnson have asked John to represent them in this transaction. What should John do in this situation?

A. John can represent both Mr Smith and Mrs Johnson as there is no conflict of interest.

B. John should decline to act, as representing both the seller and the buyer presents a conflict of interest.

C. John can represent both parties only if he has obtained written consent from both Mr Smith and Mrs Johnson.

D. John can represent both parties as long as he maintains confidentiality and acts in the best interests of both clients.

E. John should refer Mrs Johnson to another solicitor while he continues to represent Mr Smith.

Answer & explanation

Answer: B.
B is correct — one of the key professional obligations is to avoid conflicts of interest. Under the SRA Codes (and reflected in the Protocol), a solicitor should not act if there is a conflict of interest or a significant risk of such a conflict. Representing both the seller and the buyer (a sale for value) presents a conflict, so John should decline to act for both parties.
A is incorrect — there is a conflict between a buyer and seller transferring for value.
C is incorrect — consent alone does not cure the conflict; neither para 6.2 exception applies to a sale for value.
D is incorrect — confidentiality and best interests cannot be maintained for both where their interests conflict.
E is the less complete answer; the safer position recognised by the examiners is that John should decline to act for both (he could not simply pick one side where confidentiality to the other is at risk). (See Sections 2.4 and 2.5.1.)

Question 4

In a property transaction, Solicitor A is representing both the buyer and the seller. The buyer and seller are not related and have different interests in the transaction. According to the SRA Code of Conduct, is this allowed?

A. Yes, Solicitor A can represent both parties as long as he maintains confidentiality for both.

B. Yes, Solicitor A can represent both parties as long as he has obtained consent from both parties.

C. No, Solicitor A cannot represent both parties as this would constitute a conflict of interest.

D. No, Solicitor A cannot represent both parties unless he discloses the potential conflict of interest to a regulatory body.

E. Yes, Solicitor A can represent both parties as long as he has a special permit from the SRA.

Answer & explanation

Answer: C.
C is correct — under the SRA Code of Conduct a solicitor should not act if there is a conflict of interest or a significant risk of such a conflict. Here, the buyer and seller have different interests and are not related, so this is a clear conflict of interest and Solicitor A should not represent both.
A is incorrect — maintaining confidentiality does not cure the conflict.
B is incorrect — consent does not override the conflict where neither para 6.2 exception applies to a sale for value.
D is incorrect — there is no mechanism to cure the conflict by disclosing it to a regulatory body.
E is incorrect — there is no 'special permit' from the SRA. (See Section 2.5.1.)

Question 5

Your client is purchasing a registered property. The following restriction appears on the register: 'No disposition by a sole proprietor of the registered estate (except a trust corporation) under which capital money arises is to be registered unless authorised by an order of the court.' This tells you that:

A. There are two or more co-owners and they hold the property as tenants in common.

B. There are two or more co-owners and they hold the property as joint tenants.

C. The property is owned by a trust corporation.

D. It is not possible to purchase the property unless a court order is first obtained.

E. The right of survivorship applies, therefore you can buy the property as long as you confirm from a death certificate that the other co-owner is dead.

Answer & explanation

Answer: A.
A is correct — this standard Form A restriction tells you that the co-owners hold the beneficial (equitable) interest as tenants in common. Because the right of survivorship does not apply to tenants in common, capital money (the purchase price) must be paid to at least two trustees (or a trust corporation) to overreach the beneficial interests — hence the requirement limiting dispositions by a sole proprietor.
B is incorrect — for joint tenants the survivor takes the whole and no such restriction is required.
C is incorrect — the restriction mentions a trust corporation only as an exception; it does not mean the property is owned by one.
D is incorrect — a court order is not generally required; appointing a second trustee to receive the capital money will satisfy the restriction.
E is incorrect — the right of survivorship does not apply to tenants in common. (See Section 2.2.1.)

Question 6

Which ONE of the following statements is false?

A. The Land Registry keeps a register of all registered land.

B. There are no details recorded centrally to show the information surrounding an unregistered property.

C. In registered land, each property is given a unique number that is used to identify the property.

D. In registered land, the Land Registry charges a small fee for access to each property's register.

E. A good root of title is a document which is at least 10 years old.

Answer & explanation

Answer: E.
E is the false statement — a good root of title is a document which is at least 15 years old, not 10. For unregistered land the owner must demonstrate ownership through a 'root of title' providing information going back at least 15 years, ideally showing the transfer of the property into the current owner's name.
A is true — the Land Registry keeps a register of all registered land.
B is true — there are no central records for unregistered property.
C is true — each registered property is given a unique number.
D is true — the Land Registry charges a small fee for access. (See Section 2.1.)

Question 7

Replies to which of the following searches and enquiries may reveal information relating to the existing planning permission for the cinema at the Complex?

A. Local Land Charges search (LLC1).

B. Enquiries of the Local Authority (CON29).

C. Enquiries of the Local Authority (CON29O).

D. Pre-contract Enquiries of the Seller (e.g. CPSE).

E. All of the above.

Answer & explanation

Answer: E.
E is correct — it is important to appreciate that the results of more than one search can reveal useful (or indeed repetitious) information on the same topic. Planning permission information may be revealed by the LLC1 (planning permissions granted are local land charges), the CON29 and CON29O enquiries of the local authority, and the pre-contract enquiries of the seller (CPSE).
A, B, C and D are each individually capable of revealing relevant information, but because all of them may do so, the single best answer is E (all of the above). (See Section 2.3.)

Question 8

You are concerned that a small corner of the land on which the Complex is built may be contaminated land. Which of the following searches and enquiries might reveal information regarding this?

A. Local Land Charges search (LLC1).

B. Enquiries of the Local Authority (CON29).

C. Chancel Repair Search.

D. Water and Drainage Enquiries (CON29DW).

E. None of the above.

Answer & explanation

Answer: B.
B is correct — the reply to Enquiry 3.13 on the CON29 will reveal whether the local authority considers part or the whole of a site to be contaminated land. (It is also usual for pre-contract enquiries of the seller to ask about contaminated land, and an Environmental Report will look at current and past land uses so as to evaluate the risk that the site is within the statutory definition of contaminated land.)
A is incorrect — the LLC1 is not designed to provide information on contaminated land.
C is incorrect — the Chancel Repair Search concerns liability for church repairs, not contamination.
D is incorrect — the CON29DW (water and drainage) is not designed to provide information on contaminated land.
E is incorrect — option B does reveal relevant information. (See Section 2.3.)

Keep practising with PASS SQE: a handful of questions per chapter is only the beginning. To practise at exam pace and cover every corner of the Property Practice syllabus, use the CELE PASS SQE App — more than 10,000 high-quality SQE1 practice questions, with detailed explanations written by CELE's SQE tutors. Start practising today at celebar.com.