Practice points from missives review
The annual review of the Scottish Standard Clauses will not result in a new edition, but two points of practice in particular are worth highlighting
As was promised when the Scottish Standard Clauses were initially promulgated, the intention was to have an annual review of these in order to make sure that they remain up to date and reflect current practice.
I am pleased to confirm that the 2017 review has taken place, looking at the current provisions of Edition 2.
After discussion, it has been agreed that there is no requirement for a brand new Edition 3 this year.
A couple of minor changes were discussed and thought suitable for incorporation into a new edition, but the view of the drafting team was that these were not sufficient to merit a brand new edition this year with the resulting updating of styles, etc by the whole profession. These changes will therefore simply be rolled over and looked at in the review scheduled for early 2018.
The review team did look at other possible changes, particularly focusing on amendments to the standard clauses used by a number of firms. It was agreed, however, that these changes were either unnecessary or indeed incorrect, or otherwise that they did not reflect “standard” practice.
There was one technical point to highlight to members. A considerable number of firms add a clause to their amendments providing in one way or another for missives to be held as delivered notwithstanding non-physical transmission to the other agents. This clause is believed to reflect the decision some years ago in the case of Park, Petitioner when the status of a faxed missive was considered.
It is pointed out however that there is no longer any necessity for that type of clause as a result of the terms of s 4 of the Legal Writings (Counterparts and Delivery) (Scotland) Act 2015. It is suggested therefore that such clauses can happily be deleted from offers or missives generally at this time.
The main suggested change to practice, as approved by the review group, would have been the issue of a new-style offer letter where it was agreed that there would be specific suspensive clauses making an offer conditional upon either loan or sale. The suggested clauses as provisionally approved are noted in the panel. Although the offer letter will not be circulated either at this time, the review group was strongly of the opinion that good practice is for all offers to be transparent in this regard, i.e. if a purchaser will not be seeking to conclude missives due to a bid being subject to sale or loan (or indeed survey), these issues have to be clearly set forth in the offer letter.
The review group was firmly of the view that this was a matter of good practice from the perspective of a purchasing solicitor in being open and transparent, and increasingly essential from the perspective of a selling solicitor so that they can properly ascertain the nature of a bid and advise their selling clients accordingly. The group was of the view that there was no inherit merit in somehow “hiding” these provisions from an offer, and failing to do so was simply causing unnecessary friction and confusion for both agents and clients.
Adoption of this practice, whether using the suggested clauses in the panel or otherwise, is therefore strongly urged by the review group.
Finally, as has always been made clear, if any member has a particular concern about the terms of the standard clauses by way of omission or possible amendment, they should feel free to revert to the group so that these can be considered at the next relevant meeting.
Ross MacKay is convener of the Law Society of Scotland’s Property Law Committee
- This Offer and any contract to follow hereon is entirely conditional and suspensive upon the Purchaser obtaining a satisfactory offer of loan finance (mortgage) and the Purchaser shall be the sole judge as to what constitutes a satisfactory offer.
- This Offer and any contract to follow hereon is entirely conditional and suspensive upon the Purchaser’s sale of their existing property.