Residential Newsletter - Spring 2023

Residential Reflections

Each quarter, we ask our experts in the Residential Conveyancing team to reflect on an interesting piece of news, work or a case within their sector. In this edition of the Residential Newsletter, we consider some of the practical problems faced by our experts when submitting applications to the Land Registry: “Every month, the Land Registry receives approximately 340,000 applications to update registers of title, e.g. changing the name of a registered proprietor or removing a charge from a pre-existing title and approximately 34,000 applications to create a new register, e.g. following completion of a transfer of part. Some applications are completed very quickly but where delays do occur this can create practical problems for buyers, sellers, lenders and their lawyers. What practical problems have you faced recently?”

Caroline Wofinden, Director (Nottingham)

“We have had a number of issues caused by delays to registration in relation to new build developments, for example, plot owners who are seeking a re-mortgage two years after they have completed their purchase but their plot is still not registered at the Land Registry. Another issue relates to infrastructure agreements or granting rights to utilities companies. The companies involved want confirmation that none of the pending applications adversely affect their proposed arrangement. To provide that confirmation necessitates consideration of all pending applications – I have seen nearly one hundred pending applications on one site!”

Claire Yarrow, Senior Associate (Sheffield)

“If we act for an institutional lender, we are required to keep the lender updated on the registration of its charge(s). Delays in registration mean we have to provide evidence to the lender that its interest is still protected and confirm that we have chased the relevant Land Registry application. In most cases, we have no valid reason to apply to the Land Registry to expedite the registration application so completion of the application can take many months for an already registered title and over a year for a new title or first registration."

Sarah Major, Senior Associate (Manchester)

“Land Registry delays mean that we sometimes receive requests for information (requisitions) several months (sometimes in excess of a year) after completion took place. This results in a number of challenges dependent on the action required to satisfy the requisition. For example, if a document needs to be executed by one of the original signatories, they may have died or lost capacity in the intervening period or they may no longer be with the organisation they were a signatory for. Also, the requisition may require a response from a solicitor acting for the other party to the transaction. On one of my matters, the firm involved had closed and, on another, the solicitor acting was no longer with the firm – in both cases finding a resolution was both expensive and time consuming!"

---

Japanese knotweed: A perennial problem!

Native to Japan, China, parts of Korea and Taiwan, Japanese knotweed was introduced to the United Kingdom as an ornamental plant in 1825. Fast forward nearly 200 years, this perennial plant is the subject of yet more property-based litigation.

Japanese knotweed is a black sheep of the horticultural world. It can break through tarmac and cause structural damage to property. It can spread rapidly both by natural means and due to human activity, growing each year from its extensive underground rhizomes (roots).

Whilst it is an offence to "plant or otherwise cause Japanese knotweed to grow in the wild" (Wildlife and Countryside Act 1981; section 14(2)), it is not an offence for it to grow in a garden unless it is having "a detrimental effect of a persistent or continuing nature on the quality of life of those in the locality" (Anti-social Behaviour, Crime and Policing Act 2014; section 43).

But what protections are afforded to buyers where Japanese knotweed is concerned?

Back in 2013, a question about Japanese knotweed was added to the Property Information Form (TA6) (PIF) – one of the forms a seller of residential property is required to complete before contracts are exchanged. The question simply asks, “Is the property affected by Japanese knotweed?”.

The seller chooses one of three potential answers – Yes, No or Not known. An affirmative response triggers a follow-up question asking whether there is a Japanese knotweed management and treatment plan in place and requesting a copy of any insurance cover linked to the plan.

This plant is often confused with other plant species and can lie dormant underground for many years – mindful of that, answering “No” to that question can be an easy mistake to make, as a Mr Henderson discovered following a recent case heard in the Central London County Court.Mr Henderson sold his three-bedroom house in Raynes Park, south-west London for £700,000 to Mr Downing. When answering the question above, Mr Henderson chose “No”. Post completion, Mr Downing discovered Japanese knotweed growing next to the garden shed and sued his seller for misrepresentation. In his defence, Mr Henderson argued that he “reasonably believed” that the garden was not affected by the invasive plant – it had been hidden by a large bush. In reality, it had previously stood up to two metres tall and there was evidence it had been treated with herbicide.

The County Court judge found in Mr Downing’s favour, ordering Mr Henderson to pay £32,000 in damages. He also faces legal fees reported to be in the region of £200,000! 

So, what can would-be sellers takeaway from this decision?

The headline is to be extremely careful when answering question 7.8 on the PIF! The Law Society has some very helpful guidance for sellers. It states that, “If you are unsure that Japanese knotweed exists above or below ground or whether it has previously been managed on the property, please indicate this as ‘Not known'."It goes on to explain that, “If No is chosen as an answer the seller must be certain that no rhizome (root) is present in the ground of the property, or within three metres of the property boundary even if there are no visible signs above ground. Herbicide-based treatment may not kill the below ground rhizome which may lead to new growth and the spread of the plant and rhizome. Additionally, even if no above ground knotweed growth is visible, do not assume that physical excavation or remediation of Japanese knotweed rhizome (root) has or will result in complete eradication”.There is no doubt that Japanese knotweed is here to stay and with that fact comes an expectation that Mr Henderson will not be the last seller to pay the price for actions taken back in 1825!