New legal questionnaire now mandatory for sellers in Jersey
In a bid to afford buyers more protection in a home sale, a new law society policy directive has been introduced which makes a questionnaire mandatory to fill in by seller.
Sellers in Jersey, listen up. This new directive affects your home sale and it’s more important than you may think.
For anyone selling freehold property, it is now mandatory to complete what is being called a ‘Standard Seller Questionnaire’ regarding your property. Completed at the beginning of the property transaction and provided to the Buyer's lawyer, this constitutes warranties on the property from the Seller to the Buyer which has been Introduced by the Jersey Law Society's Conveyancing Sub-Committee.
If it can be proved that the Seller has knowingly entered an incorrect answer, the Buyer may now be able to sue the Seller for breach of warranty within three years of the transaction taking place, with the potential to claim compensation for their loss, or in the worst case scenario, applying for the contract to be set aside.
For now, it is only Freehold property Sellers which are seeing this as a mandatory process, but in the future, it is intended that it will apply to share transfer and flying freehold properties too.
Law firms have been trialling this process voluntarily since January, and having proven its success in these trials, the conveyancing sub-committee has decided to make it mandatory for all sellers in freehold properties.
Paul Harben, Chair of the Conveyancing Sub-Committee said that the intention was to standardise and reduce the number of questions asked by a Buyer's lawyer, simplifying the sale process.
"There has been a tendency for the Buyer’s conveyancer to ask more and more questions, to the extent that Sellers were paying less attention to their responses, even if incorrect, thereby rendering them meaningless", Mr Harben said.
He added "Sellers will know what is required from them from the outset and will better understand the risks of giving an untrue answer", referring to a court case that resulted in a Buyer being able to take action against a Seller for giving incorrect information regarding their property. This completely changes the long standing principle that a buyer buys a property at their own risk. It however remains more important than ever that a buyer carries out the appropriate surveys to ensure they are happy with the physical condition of the property.
From now on, a seller’s lawyer must enclose a copy of the Jersey Law Society's "Standard Seller Questionnaire" for their client to complete.
The Seller (not their lawyer) must complete and sign the form covering matters within their knowledge and as they relate only to their period of ownership of the property.
The Seller's lawyer will send the signed form to the Buyer's lawyer. At the same time, the Buyer’s lawyer will be conducting legal researches into the property, for example, boundaries and title, and issues relating to these would be raised separately with the Seller's lawyer.
To ensure that the questionnaire is not toothless and that the Seller is fully aware of the fact that they have to give honest answers, which the purchaser can rely upon, the questionnaire states to the Seller:
“It is very important that your answers are accurate. If you give incorrect or incomplete information to the Buyer, the Buyer may make a claim for compensation from you or refuse to complete the purchase or seek to set aside the sale of the Property."
The questionnaire currently contains 29 confirmations for the Seller to provide, grouped under the following headings: Property/title; Insurance; Charges; Services and Drains; Planning and Building; Statutory Notices; Common parts and a General section.
It will be made available through estate agents like us, and on the Law Society website so that potential Sellers will be aware of what will be required from them even before they put their property on the market. Ultimately, it should prevent the current problem of issues being raised at the last minute and thereby delaying completion, thereby resulting in faster and easier transactions.
With the questionnaire now mandatory for all sellers, make sure you’re aware of what you need to complete and the details of what you are confirming. Your estate agent and lawyer should help you fully understand the process.
If you have any further questions about the Sellers Questionnaire, or would like to see an example copy for yourself, don’t hesitate to contact us.