When building on a plot – either bought, inherited or gifted – the role of a solicitor is a little more complex than it would be if you were just moving house. The advice from The Law Societies in NI and ROI is to talk to your solicitor as early as possible in the process to avoid any pitfalls.
The owner of the land is the owner of anything that will ever be built on the land, so the solicitor’s focus will be on ensuring that the person who is going to build the house actually owns the land on which it is being built and that it has all the necessary easements for use as a site.
To do so the solicitor must check the underlying title deeds for the site on which the property is being built.
For example, if a site is accessed by a lane that leads from a public road, the solicitor will want to be sure there is a proper right of way along that lane. If water supply needs to be brought from the public road across neighbouring fields, or up a lane that the site owner doesn’t own, there needs to be an easement – a formal deed that is put in place with the third-party landowners to allow that to happen.
Without all that being in place the house will not be marketable or saleable should you wish to sell a few years down the line. Nor will a lender be willing to offer a mortgage for the building finance.
It’s the solicitor’s responsibility to marry up and compare the conditions that were in the planning permission for the site, to make sure they can be accommodated within the title.
In NI, for example, often a planning permission will have specific conditions with the access arrangements to the site from a main road.
When a site is gifted by a parent to a child the recipient needs a solicitor to register the plot in their name and ensure all the easements are going to be in place before they start spending on the build.
A gift of a site is wonderful, but it’s not worth much unless it’s got all those necessary easements in place.
In addition to this, in ROI, a solicitor will advise on the tax consequences and the title, stamp the deed and register the deed with the Property Registration Authority of Ireland (PRAI). In NI a solicitor will complete any necessary Stamp Duty Land Tax Return and attend to registration in the Land Registry of NI.
If you are inheriting the site, the personal representative of the deceased landowner would normally execute a deed of assent, which your solicitor would then register with the PRAI (in ROI) or Land Registry (NI)
Financing the dream
If you are buying the site or building the dwelling with the assistance of a loan from a lender, there will be a mortgage process, which your solicitor will advise on. Once complete, they will also provide the certificate of title to the lending institution.
The solicitor will be involved in each drawdown stage of the stage payment process. For the final drawdown, in addition to the final stage payment certificate from the architect or surveyor, the solicitor will ensure the following documents are in order:
- The final certificate of compliance with planning permission;
- The final certificate of compliance with building regulations; or
- A certified copy certificate of compliance on completion together with evidence that same has been validated on BCMS (ROI) or Building Control Completion Certificate (NI); and
- A final declaration of identity (if required)
In ROI, solicitors will have a role in ‘local needs’ planning permission cases, where there is a requirement that an agreement be entered into with the local authority. A solicitor will also be required to certify certain items to Revenue where the Help to Buy tax relief is being claimed in relation to a self-build.
When things go wrong
If you have a dispute with the work carried out by a builder or other tradesperson you may need the services of a claims (or loss) assessor and/or a litigation solicitor. The role of the claims assessor role is to establish what the nature of the defect or damage is and what the cost is of putting it right. In other words, quantifying the claim and providing the evidence for you to back it up.
The solicitor will conduct the claim and prove by reference to the contract that there has been a breach of contract. If necessary, they will pursue the claim through the courts or perhaps, these days, through the alternative dispute resolution methods such as arbitration or mediation. That depends on the terms of the building contract, which may well specify which method is to be used in the resolution of dispute. But usually a solicitor will be engaged by both parties to help them conduct the dispute,
Not every dispute will come to a solicitor. If it can be resolved with the builder who is happy to put it right you might be able to resolve it yourself with a claims assessor who will help you quantify what the loss is.
This is agreed with the solicitor and the self-builder right at the start of the process. There may be a schedule of payments throughout the build/loan drawdown, or it might be an up-front fee, particularly where the solicitor’s involvement will be limited.
When a site is transferred without a mortgage, fees are generally paid on the transfer. This is because the stamping of the deed and its registration with the Land Registry (NI) or PRAI (ROI) requires payment by the solicitor to the relevant authorities. Where a site is transferred with a stage payment mortgage, the fee is generally paid on the first drawdown, as there are fees involved in the stamping and registration of the title and the mortgage.
Due to competition law rules, it is up to each solicitor to set their fees. Solicitors’ practices are just like any other businesses and are in direct competition with each other. You should shop around and ask for an estimate of their fees before they start. All solicitors are obliged under regulatory requirements to provide details of their fees in advance.
Alan Reid, solicitor and Chair of Conveyancing and Property Committee of The Law Society of Northern Ireland
Joe Thomas, solicitor and member of The Law Society of Ireland’s Conveyancing Committee