New land and property information system for Scotland

Deputy First Minister John Swinney has announced the development of a land and property information hub for Scotland.

The Keeper of the Registers of Scotland (RoS), Sheenagh Adams, will lead a task force to develop an online system that will allow users to find out comprehensive information about any piece of land or property in Scotland with a single enquiry. The task force has been asked to report to the Deputy First Minister by July this year.

Sheenagh Adams said: “The creation of a land and property information system for Scotland is an exciting development that fits with our current project of completing the land register. Not only will this system make our economy more efficient, but it will reduce both the risks and costs of doing business. Developing the system will involve providing access to the data contained across a wide range of sources. This will remove the current costs and barriers sometimes involved with searching for land and property information.”

Professor Stewart Brymer has agreed to be a member of the task force in his capacity as Chair of Unifi Scotland (www.unifiscotland.com) He commented: “We have a great opportunity to build a spatial information system in Scotland that could be the best in the world. The data is all available but it is held in a range of disparate places. Bringing it together will benefit the economy and increase the knowledge that citizens should have about land and property. There are some excellent systems in other countries such as Norway which can be learned from in creating a digital land and property information service in Scotland.”

What is the Law in your Life?

5 things you need to know when choosing a name for your company or LLP:

1.   Your name cannot be identical to that of another registered company/LLP. Your name must also not be “too similar” to another name on the Companies House register. When considering whether your name is the same as a name that is already registered there is a list of words, characters, and symbols which are disregarded (eg United Kingdom and Great Britain). (Following recent changes in the law (January 2015), a number of words have been deleted from this list. The words Exports, Holdings, Imports, Group, International, and Services are now no longer on the list.).

2.   If your proposed name contains a “sensitive” word or expression (eg the word Scottish, English, British, etc) you must get prior approval from the Secretary of State. Likewise, if your name might indicate a connection to a public authority. The recent changes in the law referred to above have also reduced the list of sensitive words and expressions that require prior approval.

3.   Names that are offensive or use of which would constitute a criminal offence cannot be used.

4.   The names of most private limited companies must either end in “Limited” or “Ltd”. You can, however, apply to leave “limited” out of your name if the company is limited by guarantee and it fulfils certain conditions.

5.   You are prohibited from using the name of a previously insolvent company. You also cannot use a similar name to a previously insolvent company for a period of five years from the date of the first company’s insolvent liquidation.

What is the Law in your Life?

5 things you need to know about Irritancy in a Lease:

1.   An irritancy or forfeiture clause is a contractual termination clause whereby the lease will come to an end if certain prescribed events occur.

2.   The landlord's ability to terminate a lease is now controlled by statute in the event of non- payment if rent and breach of obligations assumed by the tenant.

3.   Statute the now provides for periods of notice to be served by the landlord under threat of irritancy. Care should be taken with the service of such notices.

4.   If a head lease is irritated, any derivative sub-leases also fall unless protection for sub- tenants has been pre-negotiated.

5.   Secured creditors or insolvency practitioners are not protected unless there is express provision to this effect in the lease.

A Register of Home Reports

The Home Report came about as a result of the findings of the Housing Improvement Task Force which was charged with investigating various matters with a view to seeking to identify ways in which Scotland’s housing stock could be improved. It was formed in 2001 and its report can be found at www.scotland.gov.uk/Resource/Doc/158826/0043128.pdf 

It is fair to say that the Home Report has not been without its critics since being introduced on 1 December 2008 with some criticisms being focused on cost, shelf-life and its alleged negative effect on the house buying/selling process. The timing of the introduction of the Home Report was very unfortunate in terms of coinciding with impact of the economic recession.  This coloured many people’s minds as to the fact that they were not a good idea. The Government has recently undertaken a review of the Home Report with a view to assessing its efficacy. Although the findings of the review are not yet public, it is suggested that it is unlikely that the Home Report will be abolished. Although there have been issues surrounding its effectiveness generally, it has had a positive  effect on the house buying/selling process in that prospective purchasers now have much better information about a property which they are interested in buying. That has to be a good thing. A fact that is often overlooked is that prior to the introduction of the Home Report over 90% of prospective purchasers relied on a Mortgage Valuation – the cheapest of the three survey options available in the market. The Home Report has also had an effect on the fixing of more realistic asking prices given the inclusion of a valuation in the Report. Only after a further review in say 10 years time will it be possible to carry out  a full objective assessment as to whether the Home Report has had a positive effect on improving the quality of Scotland’s housing stock. At present, it is questionable if there has been any material effect and, even if there has been, there is no effective means of measuring that.

One of the reasons for this is that Home Reports are not collated and held anywhere. Unfortunately, the then Government did not make it a requirement that Home Reports be held in a central database or register – unlike the position in England and Wales at the time. Property prices are in the public domain once titles have been registered and there is no reason why the information contained in Home Reports should also not be publicly available.

The Home Report has three constituent parts: the survey; the Property Questionnaire; and the Energy Property Certificate. There is a register of EPCs. This is held by the Energy Savings Trust – https://www.epcregister.com 

Given the absence of a Register of Home Reports, it is unfortunately the case that the system can be abused. A hypothetical example of how this could happen is as follows:

Seller A wishes to sell his flat and a Home Report is instructed. This produced a valuation of £165K but approximately £15K of essential repairs are identified. Seller A pays for the Report and decides to commission a second Report. This Report values the property at £175K with £5K of essential repairs being identified. Still not satisfied, Seller A pays for that Report and instructs a third surveyor. The third surveyor values the flat at £185K with no essential repairs being identified. Seller A pays for the survey and instructs the flat to be marketed at Offers over £180K. As an aside, this potential problem is exaggerated when one bears in mind that the RICS Red Book provides that a difference of up to 10% between surveyors' valuations is acceptable.

Such circumstances may never occur but the fact is that the system can be abused in this way and the loser is the prospective purchaser. In such circumstances, prospective purchasers have no way of knowing about the previous Home Reports and will generally proceed on the basis of Home Report 3 without instructing their own private survey over the property. So, for an outlay of less than £2K, it is possible that Seller A may secure a higher price than might otherwise be the case and the property will not have had essential repairs undertaken to it. That would be the case even if the purchaser’s solicitor followed the growing practice of inserting a clause in the Missives that the seller confirms that they have only instructed one Home Report over the property. This is all well and good, but without a Register of Home Reports how would a purchaser find out the true position without calling round every surveyor in the area? This potentially makes the clause in the missives of little value.  In what way is that fair? What contribution has been made to the goal of improving the quality of Scotland’s housing stock in such circumstances? The system was arguably fairer when lenders retained a proportion of mortgage funds until repairs identified in their mortgage valuation report had been undertaken to the satisfaction of the surveyor who undertook the survey. At least that way, the repair work was done. Such retentions still occur but are not so common as they once were.

Such unfortunate outcomes could be avoided if there was a Register of Home Reports. This would require it to be compulsory to register Home Reports at the same time as the Report is made available to the instructing party. It would then be registered and the Register would be open to public scrutiny. That way, prospective purchasers and their advisers could quickly ascertain how many Home Reports of the property there had been and when the most recent one was undertaken. This would, by necessity, lead to greater transparency in the housing market.

It is suggested that the creation of a Register would not be a difficult task. Such a Register could be held by the Energy Savings Trust along with EPCs or, indeed, by RICS or some other body. The Home Reports could be linked to properties via their Unique Property Reference Numbers and ultimately linked into the cadastral map maintained by Registers of Scotland. Such a  Register would then be searchable by way of address; name;  UPRN; Address Database; and/or  Title Number. Ideally, the Register of Home Reports would be map-based.

Now this may all seem far-fetched but is it really?

There is a flaw in the present system which it is in the public interest to rectify. It is possible to go further however. This would involve the Home Report Register being part of a National Land and Property Information Database. Such Land Information systems exist in other jurisdictions eg New Zealand and Norway. In Norway, the national land information company, Ambita AS (www.ambita.no) maintain a national database called Infoland (www.infoland.no). Infoland is a searchable database of all relevant information on land and property and over 80% of Norway’s Municipalities subscribe to it with net profits being returned to the Municipalities for them to spend on further improvements in local service provision. Put simply, it works and it works well.

The introduction of a Register of Home Reports gives us an ideal opportunity to establish a Scottish Land Information Service and create a timetable for full integration of all data on Scotland’s land and property. This will deliver benefits for citizens and for the economy as a whole. It will also provide a searchable database to interrogate in order to ascertain movements in valuation and the history of the state of repair of the fabric of the property. This would also allow an assessment of  whether or not the Home Report has delivered on one of its key objectives – that of improving the quality of Scotland’s housing stock.

(c) Stewart Brymer 2014

The provision of legal services in a digital world

In the last 35 years during which I have practised law, I have seen many changes - mostly for the good it has to be said. There has, quite frankly, been a revolution in the way in which legal and other business services can be provided. 

The world of legal service provision has undergone what can possibly be described as a perfect storm. Unfortunately, some solicitors appear to think that they are immune to the wave after wave of change that has affected all aspects of business and private life. Others, however, have embraced change and have adapted their methods of service provision accordingly. No one is saying that everything that is known must be put to one side and be replaced with something new. Far from it. There is definitely a place for solicitors to continue to be viewed as the trusted adviser in the legal process. Good communication is the key however - as it has always been.

The world of legal services is diverse, ranging as it does from the huge international law firms (who just seem to get bigger and bigger) to small local firms. There is a place for most but, increasingly, those firms who occupy the mid-ground are coming under pressure from all sides. Some of these firms have gone down the route of merger as a means of expanding their businesses. In some cases, these mergers have been the consequence of strategic planning and those firms will hopefully reap the benefits of their new structures as they deliver more specialised legal services to existing and potential new clients. Others have embarked on what can only be described as defensive mergers however and their prospects are not so good. It is not always the case that an amalgamation of more people with the same or similar skills leads to a more efficient and better respected legal firm. In such cases, firms generally accumulate more bricks and mortar and more people but do not necessarily increase their specialisation levels. With all due respect to those who wish to go down this route, why would you want to do that? Unfortunately, the result is often a dilution of the brand. The legal-services buying public are much more astute than was the case even 10 years ago and they do not accept that big is necessarily beautiful. On the contrary, they often view large firms as being more likely to charge higher fees and less likely to provide an individual service.

Clients shop around for legal services these days and think nothing of using one firm for one type of work and others for different disciplines. Increasingly, however, they also gravitate towards individuals rather than the firm. Those who manage and promote legal firms would do well to remember the principle of delectus personae. A good large firm, and there are a number who are very successful, tend to be very well managed by people who understand business and who encourage the principle of the business operating as a “large small firm” with the focus being on the client. This is best achieved by individual solicitors being encouraged to communicate well with clients as individuals rather than viewing them as a source of billable hours. In other words, the individual solicitors are recognised for their legal skills (which should be a given) and are given the freedom to make decisions and, if necessary, spend time which would otherwise be billable on building relationships with clients – both existing and potential. That is what we value when we are a consumer of a particular service. Why should the provision of legal services be any different? 

(c) Brymer Legal Limited, 2014

What is the Law in your Life?

5 things you need to know about Alienation under a Lease:

1.   This is an assignation of the tenant's interest in a lease or sub-letting of the leased subjects.

2.   Alienation of part only is generally prohibited.

3.   The lease will invariably provide that there is to be no alienation without the prior written consent of the landlord which consent shall not be unreasonably withheld. This introduces an element of subjectivity to the otherwise subjective discretion of the landlord.

4.   There is no implication of reasonableness in Scots law.

5.   An assignation is only completed when a formal intimation of assignation is served on and acknowledged by or on behalf of the landlord.

What is the Law in Your Life?

5 things you need to know about The Intellectual Property Act 2014:

The Intellectual Property Act 2014 came into force on 1 October. The Act includes various changes to UK legislation – mainly in the areas of patents and designs:

1.   A new legal framework for ratification of the Unified Patent Court Agreement in the UK.

2.   Extension of grounds on which the UK IPO can provide an invalidity opinion on a patent.

3.   It is no longer necessary to put a patent number on a product. All that is now required is a link to a webpage listing the patent(s).

4.   There is a new criminal offence for the deliberate copying of a registered design.

5.   When an unregistered design is commissioned, the commissioner will no longer be the owner of the design unless there is a contract to assign in place.