Qualified Lawyers Transfer Scheme (QLTS) Property and Probate Practice Syllabus

Property and Probate Practice syllabus — full chapter and topic list

Expand any chapter to see its topics and sub-topics. This is the whole examinable outline for Property and Probate Practice in Qualified Lawyers Transfer Scheme (QLTS), not a summary of it.

1. 1

   Conveyancing Process

   4 topics

   • Stages of a freehold transaction
     • Pre-contract investigation and searches
     • Exchange of contracts
     • Completion and post-completion
   • Standard Conditions of Sale
   • Investigating title
     • Registered title and official copies
     • Reporting to client
   • Stamp Duty Land Tax and registration
2. 2

   Leasehold and Mortgages in Practice

   4 topics

   • Grant and assignment of leases
     • Licence to assign and covenants
   • Acting for lender and borrower
     • Conflict of interest issues
   • Leasehold enfranchisement overview
   • Remedies for breach of leasehold covenant
3. 3

   Wills and Estate Administration

   4 topics

   • Validity of wills
     • Formalities under the Wills Act 1837
     • Testamentary capacity and intention
   • Intestacy rules
   • Grants of representation
     • Probate and letters of administration
   • Administration of the estate and distribution
4. 4

   Inheritance Tax and Estate Planning

   4 topics

   • IHT charge and the death estate
   • Exemptions and reliefs
     • Nil rate band and transferable NRB
     • Business and agricultural property relief
   • Lifetime transfers and PETs
   • Personal representatives' liabilities

Property and Probate Practice flashcards for Qualified Lawyers Transfer Scheme (QLTS)

24 of 52 cards from the Property and Probate Practice deck — real questions with worked answers.

1. What are the three main stages of a typical freehold conveyancing transaction?

   (1) Pre-contract (investigating title, searches, drafting and approving the contract, raising enquiries); (2) Pre-completion (exchange of contracts, which creates a binding contract; pre-completion searches; preparing the transfer deed and requisitions); (3) Post-completion (completion, payment of SDLT, and registration of the buyer at HM Land Registry).

2. At what point in a conveyancing transaction does a binding contract come into existence, and what is the key consequence for risk?

   On exchange of contracts. From exchange, the contract is binding, the buyer becomes the equitable owner, and (under Standard Condition 5.1) risk in the property passes to the buyer, so the buyer should insure from exchange.

3. What is the difference between legal title and equitable title passing in a conveyancing transaction?

   Equitable (beneficial) ownership passes to the buyer on exchange of contracts (under a bare trust/estate contract). Legal title passes only on completion when the transfer deed (TR1) is executed and delivered, and is perfected by registration at HM Land Registry.

4. What is the purpose of pre-completion searches, and name the key one for registered freehold land?

   They protect the buyer against last-minute changes and confer a priority period. For registered land the key search is an OS1 search at HM Land Registry, giving a 30-working-day priority period within which the buyer must lodge their application for registration to take free of intervening entries.

5. What is the difference between the Standard Conditions of Sale (SCS) and the Standard Commercial Property Conditions (SCPC)?

   The SCS are the standard form of contract terms used for residential and simpler property transactions; the SCPC are designed for commercial property transactions (e.g. dealing with VAT, capital allowances and more complex tenancy/title matters). Both can be varied by special conditions.

6. Under the Standard Conditions of Sale, what is the standard rate and amount of the deposit, and when is it payable?

   A deposit of 10% of the purchase price is payable on exchange of contracts (SC 2.2). It is normally held by the seller's solicitor as stakeholder (SC 2.2.6), meaning it cannot be released to the seller until completion.

7. Under the Standard Conditions of Sale, what is the contractual completion time and the consequence of completing after it?

   Completion takes place on the contractual completion date with money to be received by 2:00 pm (SC 6.1.2). If the buyer's payment is received after 2:00 pm, completion is treated as taking place on the next working day for the purposes of compensation/interest (apportionment), so default interest may run.

8. Under the Standard Conditions of Sale, what is a 'notice to complete' and what is its effect?

   Where a party fails to complete on the completion date, the other party may serve a notice to complete (SC 6.8). This makes time of the essence and gives the defaulting party 10 working days (excluding the day of service) to complete; failure entitles the innocent party to terminate and exercise contractual remedies (e.g. forfeit/return deposit).

9. What does 'investigating title' involve for registered land, and what are the key documents examined?

   Examining the official copies of the register and the title plan from HM Land Registry. The register has three parts: the Property Register (describes the land and estate), the Proprietorship Register (names the registered proprietor, class of title and any restrictions), and the Charges Register (burdens such as mortgages, covenants and easements).

10. What are the classes of registered title and which is the best?

    Absolute (best — guaranteed by the state), Good leasehold (leasehold where the freehold title was not investigated), Possessory (based on adverse possession or lost deeds), and Qualified (subject to a specific defect noted by the registrar). Absolute freehold/leasehold is the most desirable.

11. When investigating an unregistered freehold title, what is the minimum period of title the seller must deduce, and what is the 'root of title'?

    A good root of title at least 15 years old must be shown (s.23 Law of Property Act 1969). The root document must deal with the whole legal and equitable interest, adequately describe the property, and cast no doubt on the title — typically a conveyance on sale or a legal mortgage.

12. What is the function of the Land Charges Department search (Form K15) in unregistered conveyancing?

    It searches against the names of estate owners during their periods of ownership to reveal registered land charges (e.g. Class C(iv) estate contracts, Class D(ii) restrictive covenants, Class F matrimonial home rights). Correctly registered land charges bind a buyer; the search confers a 15-working-day priority period.

13. How is Stamp Duty Land Tax (SDLT) calculated, and when must the return be filed and tax paid?

    SDLT is charged on the chargeable consideration for land transactions on a progressive 'slice' (banded) basis, with each portion of the price taxed at the rate for that band. An SDLT return (SDLT1) must be filed and the tax paid within 14 days of the effective date of the transaction (usually completion).

14. Write the formula for SDLT payable on a residential purchase where the price falls across multiple bands.

    $$\text{SDLT} = \sum_{i} (\text{amount in band } i) \times r_i$$ where $r_i$ is the SDLT rate applicable to band $i$. Each slice of the price is taxed only at the rate for that band, not the whole price at a single rate.

15. What is the surcharge for higher-rates/additional dwellings and for non-UK resident buyers under SDLT?

    An additional 3% surcharge applies on top of standard residential rates for purchases of additional dwellings (e.g. second homes/buy-to-let) above the threshold, and a further 2% surcharge applies to non-UK resident purchasers of residential property. These are added to each band's rate.

16. What is the difference between the 'grant' of a lease and the 'assignment' of a lease?

    A grant is the creation of a new lease by a landlord (freeholder or superior leaseholder) to a tenant for a term. An assignment is the transfer of an existing lease from the current tenant (assignor) to a new tenant (assignee) for the remainder of the term — no new lease is created.

17. What are the formality and registration requirements for granting a legal lease?

    A legal lease for more than 3 years must be made by deed (s.52 LPA 1925). A lease granted for more than 7 years (and assignments of leases with more than 7 years left) must be registered at HM Land Registry with its own title number; leases of 7 years or less generally take effect as overriding interests.

18. How does liability on leasehold covenants differ between 'old' (pre-1996) and 'new' (post-1995) tenancies?

    For old leases (pre-1 Jan 1996), the original tenant remains liable on the covenants for the whole term under privity of contract even after assigning. For new leases (Landlord and Tenant (Covenants) Act 1995), an outgoing tenant is automatically released on a lawful assignment, though a landlord may require an Authorised Guarantee Agreement (AGA) guaranteeing only the immediate assignee.

19. When acting on a residential mortgage, in what circumstances may a solicitor act for both the lender and the borrower, and why is this generally permitted?

    A solicitor may act for both where there is no conflict (or significant risk of conflict) of interest — common in standard residential purchases because lender and borrower share the substantial common interest of completing the purchase with good title. The solicitor must comply with the lender's instructions (often the UK Finance Mortgage Lenders' Handbook) and report any issues affecting the security.

20. What is a solicitor's duty of disclosure to a lender client, and what must they report?

    The solicitor must report anything that may affect the lender's decision to lend or the value/marketability of the security — e.g. a discount/incentive on the price, a discrepancy in the purchase price, a sub-sale, gifted deposits, or any title defect. Failure can amount to negligence or breach of trust/warranty.

21. What steps must be taken on completion of a mortgage to perfect the lender's security?

    The mortgage deed is executed by the borrower before completion; on completion the loan is advanced. Post-completion the charge must be registered: at HM Land Registry (entered in the Charges Register) and, if the borrower is a company, at Companies House within 21 days of creation to be valid against a liquidator/administrator.

22. What is leasehold enfranchisement and which statutes principally govern it?

    Enfranchisement is the statutory right of qualifying long leaseholders to acquire a greater interest in their property. For houses, the Leasehold Reform Act 1967 gives a right to buy the freehold or an extended lease; for flats, the Leasehold Reform, Housing and Urban Development Act 1993 gives a right of collective enfranchisement (buying the freehold of the building) and an individual right to a lease extension.

23. Under the Leasehold Reform, Housing and Urban Development Act 1993, what is the individual statutory lease extension entitlement for a qualifying flat tenant?

    A qualifying tenant of a flat under a long lease is entitled to a new lease of the flat at a peppercorn (nil) ground rent for the unexpired term plus an additional 90 years, on payment of a premium calculated under the Act.

24. What are the qualifying conditions for collective enfranchisement of a block of flats under the 1993 Act?

    The building must contain at least 2 flats held by qualifying tenants; at least two-thirds of the flats must be let to qualifying tenants (long leaseholders); no more than 25% of the internal floor area may be in non-residential use; and the participating tenants must hold at least 50% of the total flats in the building.

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