Refund of SDLT on Derelict property

Refund of SDLT on Derelict property

10:58 AM, 6th November 2020, About 4 years ago 6

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Hello, I purchased a property last year from my local council which had a covenant stating that the house had to be brought back into a habitable condition within 12 months. I had heard that if the property was not bought in a habitable condition and I had evidence to show its disrepair that SDLT was exempt.

I ran this past my solicitor, he said he had not encountered this situation before so could not advise.

I paid the SDLT on the purchase, then approached Gepp Solicitors in Chelmsford who contacted the HMRC and my SDLT was repaid, do I have a case against my first Solicitor?

Many thanks

Alex


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Ron H-W

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12:01 PM, 6th November 2020, About 4 years ago

If you had not already been aware of that SDLT exemption, then you might well have had a case for his failure to point out this aspect.
This would, of course, be limited to your actual loss: the reasonable fees of the second solicitors, LESS the additional fees that somebody in his position would reasonably have charged for ensuring it was done correctly.

HOWEVER, you were already aware of the exemption, and you asked him; he said he "could not advise".
This means that you were expected to take other measures - perhaps even "changing horses in mid-stream".

I really don't think you can have a case against somebody who simply recognises and states his own limitations, in what would appear to be a very professional manner.
(But it would, I think, not have been unreasonable to hope that he would take a bit of effort to find out - something that's a LOT easier now than it was a few decades ago!)

By the way, have you by now "brought the house back into a habitable condition"? Because time is running out - if it hasn't already!

Disclaimer: "IANAL"

Marcus Serene

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10:18 AM, 7th November 2020, About 4 years ago

Hi
The unfortunate fact here is few solicitors are aware of stamp exemption they normally use the fact that that are not tax advisers for not putting and x in the box, while this is a very straightforward issue it is not widely known that stamp is exempt on uninhabitable property and there’s no way any solicitor will be exposed to risk when they don’t have to
Frustrating as it is there are two options one pay the stamp and claim it back you can do this yourself it really is quite a simple process or make sure you have and keep a complete photo record of the issues and instruct the solicitor not to pay and you accept any comeback from SDLT

Edwin Cowper

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11:47 AM, 7th November 2020, About 4 years ago

If you are not mistaken about what your lawyer said, then you should claim your money back. If he didn't know, he should have found out. Is he really a lawyer? Its what lawyers do: advise their clients.
As a lawyer of over thirty years standing, I cannot imagine SDLT advice could be outside my advice area in a purchase, even if I had not had the problem before.
Report him to the Solicitors Regulation Authority for shoddy work. I expect they won't do anything, but at least you'll give him some well deserved aggro by having to deal with them.

Edwin Cowper

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11:51 AM, 7th November 2020, About 4 years ago

Reply to the comment left by Edwin Cowper at 07/11/2020 - 11:47
Further thought: he should have given you a client letter explaining the scope of his work. That may or may not help. I suspect that if he does not exclude advice on SDLT he will be liable for failing to advise. If the issue wasn't raised with him before you became his client, then in my view it will be part of his contract on express or implied terms to advise.

Edwin Cowper

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18:49 PM, 7th November 2020, About 4 years ago

Reply to the comment left by Marcus Serene at 07/11/2020 - 10:18
I completely disagree with your view. With the greatest respect, unless they in their contract and terms and conditions of acting exclude advice in this area, then its their job.

If they don't want to act as lawyers, but want money for old rope or no rope, they should go and do something else

Edwin Cowper

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18:53 PM, 7th November 2020, About 4 years ago

On reflection I should have said I have been a lawyer for over thirty years,

In recent years the standard yearly updating law course has covered SDLT and exemptions etc in GREAT detail. If the lawyer doesn't know those he is incompetent. And the client should take action.

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