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EXPLANATORY MEMORANDUM - NEW LAW SOCIETY GENERAL CONDITIONS OF SALE 2009 EDITION

The following are the changes that have been made to the 2009 edition of the General Conditions of Sale, compared with the 2001 (revised) edition (last revised in November 2008) (hereinafter referred to as the “previous edition”).

The 2009 edition reflects all legislative changes up to 31 December 2009, including the Land and Conveyancing Law Reform Act 2009, and eStamping requirements, which came into effect on 30 December 2009.

As practitioners are familiar with the existing General Conditions of Sale, efforts have been made to retain the existing numbering and format.

The substantive changes are:

1) Tax numbers of the parties
Obtaining accurate tax numbers of the parties is of critical importance to a purchaser to enable the purchaser to stamp the Deed of Assurance, and without incurring penalties. Boxes have been provided under the names of each of the parties in the Memorandum to insert their tax numbers.

In addition new General Condition 20(d) requires that the vendor furnish the tax number of the vendor, properly vouched, to the purchaser prior to or on completion of the sale.

The Revenue eStamping procedure has a drop-down menu to select the type of tax number for the parties to the assurance, and distinguishes between, for example, an income tax number and a PAYE number. The purchaser should therefore obtain not only the vendor’s tax number, but the description of that tax number.

Vouching the tax number might be by way of production of a copy extract from correspondence with the Revenue, or the certificate of an accountant.

2) VAT
Special Condition 3 is by way of reminder to insert the current recommended form of VAT Special Condition, and amend it as appropriate.

3) Non-title information sheet
New paragraph 3(c) deals with the new charge for non principal private residences, introduced under the Local Government (Charges) Act 2009.

New paragraph 4 deals with Building Energy Rating (BER) certificates.

4) Definitions
The definition of ‘Working Day’ has been reworded for greater clarity but without changing the import of the phrase.

5) Auction
General Condition 4(c)(i) of the previous edition, which permitted a vendor to bid himself or by an agent up to the reserve price, has been deleted in anticipation of the coming into law of the Property Services (Regulation) Bill 2009, section 57 of which will prohibit this practice.

6) Delivery of title
General Condition 7 has been expanded to clarify that the vendor is only required to deliver within seven Working Days after the Date of Sale copies of those documents which have not already been furnished to the purchaser.

7) Requisitions
The first two lines of General Condition 17 have been amended reflecting the amendments at General Condition 7 referred to above. The changes are intended to bring greater clarity to the timeframe within which Objections and Requisitions on Title may be made.

8) Deed of assurance
General Condition 20(a) has been amended and new General Condition 20(b) inserted. The new provision clarifies that a purchaser is required to accept delivery of an assurance of the property on completion in favour of the purchaser or the purchaser’s nominee.

Where the parties envisage that a Deed of Assurance will not be delivered on completion, the matter should be addressed by way of Special Condition.

9) Completion and interest
General Condition 24(c)(iii) has been amended to substitute reference to the Land and Conveyancing Law Reform Act 2009 for the Conveyancing and Law of Property Act 1881. This provision relates to undertakings given by the vendor’s solicitor where completion is being effected by post, or other means than by attendance at the office of the vendor’s solicitor.

10) Land Act 1965, section 45
General Condition 28 of the previous edition has been omitted, as section 45 of the Land Act 1965 has been repealed. In order to maintain the numbering elsewhere in the General Conditions, General Condition 29(a) and (b) of the previous edition (Compulsory Registration) has been renumbered as new General Conditions 28 and 29.

11) Forfeiture of deposit and resale
General Condition 41 has been amended at (a) and (b) to add the words “or other stakeholder” after “Solicitor” to address the fact that part of the monies paid by a purchaser may be held by a party other than the vendor’s solicitor, for example, an auctioneer.

12) Arbitration
The reference in General Condition 51(a) has been amended by the substitution of “Condition 10(b)(iii)” for “Condition 10(c)”.

In addition a new General Condition 51(d) has been inserted relating to disputes under General Condition 35 (Disclosure of Notices), and General Condition 51(e) (formerly General Condition 51(d)) expands the remit of the arbitration provision in respect of General Condition 36 (Development).