Written by Caroline Lamb
Caroline Lamb
Caroline has been working as a freelance copywriter since 2013. In that time, she has created articles, blog posts, landing pages, white papers and other types of content for a huge variety of clients.
Edited by Ruban Selvanayagam
Ruban Selvanayagam
Ruban Selvanayagam is a professional cash homebuyer, private rented sector landlord, auction specialist, blogger and media commentator.
As a seller or a prospective buyer, engaging in any kind of property auction usually involves an auction legal pack.
This is a collection of documents relating to a property being sold at auction. It is compiled and initially paid for by the seller and the seller’s solicitor. However, the seller can recoup some of the costs as part of the sale from the buying party.
While creating auction legal packs is not a statutory requirement, it’s highly recommended.
If you are the current owner of a property soon to be sold at auction, you should instruct an experienced conveyancing solicitor to compile a legal pack on your behalf. Ideally, these documents need to be prepared well before the bidding process.
In most cases, a property’s auction legal pack will be available to prospective buyers on the relevant auctioneers’ website within good time before the auction date.
Any potential buyer must be able to access official information related to the property in which they express interest. This means that buyers become aware of any hidden legal matters or possible expenses well ahead of time.
After all, auction packs contain important documents such as references to legal issues and other key information that – if omitted – may lead to serious financial losses.
For this reason, all prospective buyers – through both traditional and modern method auctions – must obtain access to a property’s legal pack before bidding on that property. Ideally, they should also instruct a conveyancing solicitor to scrutinise its contents on their behalf well in advance (for a fee) and to provide them with appropriate advice.
Whilst it is not a legal requirement for property sellers to compile a legal pack before a transaction takes place, it’s never really recommended.
This is because buyers will tend to be more cautious if there is nothing that gives them background into the property. The result will either be low or no bidding at all. Indeed, many conveyancers would advise buyers against moving forward without one.
Although there are certain legal protections in place, sellers may also be prosecuted and/or sued for damages by the buyer in the case of any undisclosed issues arising.
A comprehensive legal pack contains all relevant documentation relating to the sale of a property at auction.
In this section, we explore most of the legal documents that must be included.
The Royal Institute of Chartered Surveyors (RICS) provides a set of auction conditions (known as “Common Auction Conditions” or “CACs”).
These are commonly followed by most UK auctioneers and would typically include:
All auction legal packs must feature an official copy of the lot’s Title Register (or Deed). This is a document held by the Land Registry that proves that the seller is the property’s current owner. Once the conveyancing process is over, that name on the Register will change to the buyer.
In addition to the original purchase price, the Title Register also contains information on 1st and 2nd charges (securities) held against the property- typically by mortgage companies and/or secured lenders.
If a seller does not have a copy of the original deed, their original solicitor or mortgage lender will have it. Otherwise, a scanned copy can be easily downloaded from HM Land Registry for a nominal fee.
Accompanying the Register (Deed), the Title Plan is also available from the Land Registry and reveals the precise boundaries of the property and any associated land.
The image is extracted from an Ordnance Survey (OS) map drawn to scale. The land included in the title is typically highlighted in red (on top of the black).
Note that physical features – like hedges or fences – marking the boundary will be solid black. Anything unmarked will be dashed.
Any separate parcels of land included in the property’s title will be marked in green with a red border line.
There may also be other coloured markings which will correspond to the Title Register.
Whilst the results of conveyancing searches are legally required for a private treaty (open market) sale, there isn’t a legal obligation to furnish these for auction sales. We often recommend getting them as they can help buyers become more confident (and potentially bid higher).
You can find out more about the associated fees when confirming conveyancing quotes. It’s worth noting that most solicitors charge for searches at cost.
The most common searches found in auction legal packs include:
Most searches can be produced within a week or less. However, requests from local authorities (i.e the LLC1 and the CON29) can take several weeks and sometimes months.
For this reason, auction buyers often take out no search indemnity policies to cover any negative outcomes that may transpire.
Issued by the Law Society, Special Conditions of Sale sometimes feature in a legal pack and outline specific legal rights and obligations related to the transaction.These conditions may also include any financial matters that will affect the buyer after the completion date, such as issues with probate, the property’s title or ongoing / retrospective charges.
Other conditions of sale include details of the reimbursement of conveyancing costs by one party to the other – i.e. by the buyer to the seller.
Note that there are also Standard Commercial Property Conditions (SCPC) which cater more broadly to these types of transactions.
The auction pack should also contain the relevant Law Society forms. Most of these have an associated code beginning with “TA”.
The TA6 and TA10 are the two most important forms to read through.
Requires sellers to give truthful answers related to the presence and specifics of the property.
The questions relate to boundaries, disputes / complaints, notices / proposals, alterations / planning / building control, guarantees / warranties, insurance, environmental matters, easements/rights of way, presence of Japanese knotweed, parking, other charges, occupiers (confirmation that the property will be sold with vacant possession), services / utilities and other transactional information.
Requires sellers to give truthful (and legally binding) answers to what physical items included in the sale.
The sections of the form are: basic fittings, kitchen, bathroom, carpets, curtains / curtain rails, light fittings, fitted units, outdoor area, television / telephone, stock of fuel and other items.
If the property is leasehold, the legal pack should contain the following:
This is a bundle of documents that typically contains full contact details, Service Charge / Ground Rent statements, 3 years of management company accounts, major works plans, asbestos / fire safety certificates, buildings insurance policy / premium confirmations, notice / deed of covenant / freeholder fees, dispute / enfranchisement notices.
Requires sellers to give truthful answers related to the type of leasehold property, maintenance / service charges, payment reviews (including inflation-indexed increases), ownership / management, freeholder (landlord) contact details, notices, consents, complaints, alterations, enfranchisement, building safety.
Requires the freeholder / management company to provide truthful answers regarding legal representation, service charge / ground rent / insurance premium collection, day-to-day maintenance, company administration, transfer / registration, disputes / enfranchisement and other more general questions.
Also completed by the freeholder / management company this shorter document stipulates notice / deed of covenant fees, regular payments during ownership and any additional payments.
Whether your property is residential or commercial, the seller will need to include an Energy Performance Certificate EPC in its legal pack. An Energy Performance Certificate EPC is a report indicating the property’s energy efficiency.
Sellers may also include gas (CP12) and electrical (NICEIC / NAPIT) safety certification.
Leasehold property legal packs will also often contain fire safety certificates and certificates of compliance.
When selling tenanted properties at auction, buyers would often want to see relevant tenancy information within the legal pack. This may include:
There are a range of different documents to include in a legal pack for commercial properties.
The seller’s conveyancing solicitor must be instructed to compile an auction legal pack within the initial stages of preparation for auction. A decent conveyancer can compile the pack within a few days, assuming he/she has all the relevant information.
Ideally, it should be ready at least a week before the date upon which the property will be sold at auction.
In most cases, a legal pack will come at a cost of between £200 and £500 (these can be checked when seeking out conveyancing quotes).
Below are some things to be aware of…
Without the relevant details regarding the legal pack, buyers do not have sufficient details to make informed decisions. In such scenarios, with the ability to ask questions, most solicitors would advise against moving forward with the sale.
At the same time, there are some astute buyers who are able to make their own private investigations into the property and come across angles that others may not notice.
If the demand for the deposit on exchange of contracts is over 10% (as guided in most standard auction conditions), it’s worth undertaking some extra checks to see why the seller requires more initial funds.
Indeed, the seller should be satisfied with this level of deposit which almost always translates to the buyer completing on the sale.
If the buyer fails to complete on time, most auctions contracts (governed by RICS Common Auction Conditions) incorporate a 10-day notice period. It’s worth checking why this may be the case and there will be no associated penalties.
It’s fairly common for unmortgageable properties to appear at auction (as they often struggle to sell on the open market).
However, many auction buyers take on these properties to render them mortgageable. If the issues are expensive or potentially irreversible
Most special conditions are reasonably understandable or can be researched online with relative ease. There are also a number of property investment forums where you can ask question from those experienced at buying at auction. Should this not be the case, it may be worth consulting an independent solicitor / auction conveyancing expert.
Unspecified financial implications after the fall of the hammer can result in demands originally made by the seller being passed on to you. Examples include rental arrears, unpaid service charges (for leasehold properties)
Often related to easements, restrictive covenants and rights of way or incomplete works on shared land
It can be, however, the costs can mount up as you’re not always sure if you will actually win the auction.
Although the principle of caveat emptor (“buyer beware”) always applies, it’s sometimes worth Googling particular issues that you are unsure about.
There are also online property forums, LinkedIn Groups (such as our own) and networking communities where you pose questions / issues you’re concerned about. It’s more than likely that someone has faced the same issue that you have.
Much will come down to how much you’re willing to pay for the property. If you can make an assessment of the realistic risks and
Some clients who are facing mortgage arrears or other kinds of debt.
Once complete, a legal pack usually remains valid for six months. For this reason, if a seller decides to withdraw a property from auction, it is important that they keep track of the age of the pack. A new set of documentation will be required if another attempt is made outside of that half-year window.
Legal packs must be complete and available to auctioneers and buyers well in advance of auction day. This is a legal requirement, as, without a legal pack, potential buyers cannot be forewarned of any issues.
Depending on the auction company, a legal pack may be accepted three days prior to sale at the latest.
While most auctioneers will accept a pack featuring only the title deeds and special conditions of sale, this may not be sufficient for some – and may well discourage prospective buyers who might suspect that the seller has something to hide.
For this reason, it is within the best interest of the seller’s solicitor – and, indeed, the sellers themselves – to provide a full, truthful and comprehensive legal pack well in advance of auction day, or risk their property being withdrawn.
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