As part of the conveyancing due diligence process, your solicitors review and report on a number of searches. The purpose of the searches are there to ensure that the property you are buying does not come with any nasty surprises after you take up ownership. This article will consider a list of non-exhaustive searches that are frequently carried out on a development site.
Search of the Index Map (SIM)
One of the first searches we carry out is called a SIM search. We send a plan to the Land Registry who then tell us what title number or numbers the land that is being conveyed to you falls under, whether the land is unregistered and whether the land is freehold or leasehold and subject to any leases and sub-leases. The search may also reveal whether there are any pending application for first registration.
Local authority search
Local authorities have a statutory obligation to keep a register of every property in their locality. The register will contain a number of details. Carrying out a local search will reveal that register. Some of the most important details we look out for are as follows;
Local authorities have the power to register certain financial charges against properties. For instance if a local authority was forced to make a dangerous structure safe due to breach of planning or building regulations, they would have incurred expenditure doing this. These charges will bind the land and therefore a new owner will take subject to that charge and will be liable for discharging that charge. It is therefore up to us to obtain the relevant evidence or undertaking that the charge has been discharged or will be discharged at the point of completion by the seller.
Tree preservation orders (TPOs)
A tree on the property that is subject to a TPO cannot be felled without the local authority’s consent. Interfering with such trees is a criminal offence. We will let you know if there are any trees on the property that are subject to TPOs. It is then for you to determine whether such trees pose a detrimental effect to your development plans.
Conservation Area status
No demolition can take place in a conservation area without Local Authority consent. Also certain types of developments may be entirely prohibited in a conservation area. You should determine how your development plans are affected if the property is situated in a conservation area.
Planning enforcement notices
It will be prudent to know whether there are any pending planning enforcement notices against the property as a result of breach of planning. You are likely to take on the fight against the local authority should there be any unsettled planning disputes once you take ownership. Existing enforcement notices may also hinder your chances of getting future planning permission until it is settled.
A Local Search will confirm whether or not the road abutting the property is adopted. The problem is that the Local Search will not tell you whether you can actually access your property from the road. For example, small strips of land may exist between the property that is being acquired and the adopted highway. These strips are known as ransom strips since if the person who owns the strip does not cooperate, they can make the property unusable and hold you to ransom. Ransom strips can affect the value of the property and almost every lender will refuse to lend against it. This could be catastrophic especially for a property developer or for a commercial transaction.
With this search, electricity, gas and telecommunications providers supply plans showing the route of any services and details of any wayleave agreements affecting the property. This will be particularly appropriate where development is proposed. The search includes an electricity cable search, BT search of BT cable routes and equipment, gas pipeline search and cable and wireless search. This is very important as not discovering a gas pipe or electricity cables that run under the property until after development has started can be dangerous, cause delay in the construction programme and additional expense for the pipe or cable to be moved. You will however need to use the search results and rely on your own technical consultants for a full opinion. If their opinion proves inconclusive a full site survey may be suggested.
The liability to pay for chancel repair attaches to former rectorial land unless the liability was abolished by statute or substituted annuity. Changes to the law which came into force in October 2013 means that the number of properties bound by chancel repair will reduce over time but under certain circumstances liability may still arise. We’ll do a chancel check search to ascertain whether there is potential liability. If there is, we will advise you to take out an appropriate indemnity policy.
You will need to know whether the property you are buying is contaminated. If the land is deemed contaminated you might be ordered under Part 2A of the Environmental Protection Act 1990 to undertake remediation works. You may also get sued by adjoining property owners if contaminants from your property is affecting their land. Also if the property is contaminated, it is likely that the Local Authority will make it a planning condition in any planning permission that you apply for that you will remediate the property before commencing any development work.
There are a vast amount of other searches we will consider commissioning on a case by case basis. These depend on where the property is located and what you intend to do with it. These may be but not limited to coal mining search, tin, clay and limestone search, existing and proposed railways search such as London Underground, Crossrail, HS2, Network Rail etc.
Our due diligence when buying property is not only limited to searches carried out as noted above. We will still need to investigate title, determine whether there are any adverse rights and covenants noted on the title that could prejudice your plans for development or anything that could affect your chances of getting development finance. You will also need to carry out personal inspections of the property and initiate surveys.
Author Mohammed Kalam has been working as a fee-earning Paralegal for the last five years acting for housing associations, charities, developers and high net-worth individuals, one of his highlights has been acting for a housing association who instructed him to simultaneously extend 45 leases under the statutory route as tenant