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What is Included in an Auction Legal Pack?

Friday June 16, 2023

An auction legal pack is a set of documents that contain information that a potential buyer will want to know about a property before bidding. 

Failing to both examine and understand the contents of a legal pack is a risk for buyers at auction and may result in substantial financial losses. Keep reading to find out what’s included in an auction legal pack and why you need to review it.

 

Is an auction pack a legal requirement?

While auction legal packs can be extremely beneficial to any potential bidders, there is no legal requirement for the vendor to produce a comprehensive legal pack. There will always be a legal pack for a property in auction, but the contents of it will vary for each and every property. There is no legal requirement that the auction legal pack contain specific documents. 

A Seller should provide a comprehensive auction legal pack as they will give more comfort and confidence to a buyer the more information that is disclosed. That said, a Seller is unlikely to include in an auction pack a document which discloses negative issues affecting a property. 

A Buyer should always be wary of an auction legal pack that contains very few documents. 

Can a property be sold at auction without a legal pack?

Yes, theoretically a property can be sold at auction without a comprehensive legal pack – the property can be “sold as seen”, but this is unlikely. 

An auction legal pack will contain something called “Special Conditions”. These are specific conditions drafted by the Seller’s solicitor in relation to the property to be sold. A property in auction will always need a set of Special Conditions, so there should always be an auction legal pack which at the very least contains these conditions.

The Special Conditions form part of the contract between the Buyer and the Seller and set out the terms upon which the Property will be sold. 

 

Who prepares the legal pack for an auction?

The auction legal pack is usually prepared by a Seller’s solicitor. 

What is included in an auction legal pack?

The auction legal pack is a compilation of important documents relating to the property being sold, and it will usually include some or all of the following:

• Special Conditions:
  Most auctioneers will follow the Royal Institute of Chartered Surveyors 4th edition Common Auction Conditions. These are standard terms and conditions for auctions and how the property is to be sold.
  
  The Special Conditions tie in the Common Auction Conditions and set out the terms upon which the particular Property is to be sold and so are specific to the transaction.
  
  They will state, for instance, whether the property to be sold is vacant or occupied. They will also state such things as whether or not VAT applies to the purchase price, the time period between the auction and completion of the transaction and payments due in addition to the purchase price.
• Land Registry Official Copies (also known as a “title deed”):
  This is a copy of the Register held by the Land Registry which will confirm the current registered owner, whether or not there are any covenants or rights affecting or beneficial to the property and whether or not there are any mortgages registered against the property.
  
• Land Registry Title Plan:
  This document should show the registered boundaries of the property.
• Official Copy Deeds and Documents:
  If documents are referred to on the Land Registry Title as containing rights or covenants, they should be included in the auction legal pack
• Conveyancing Searches:
  These searches contain a range of information related to the property’s immediate and surrounding area. The main searches include a local authority search, environmental report, water, drainage search, coal mining report and a chancel search. 
  
  Other searches may also be appropriate depending on where the property is located. Our solicitors will be able to advise you what searches are appropriate for the particular area and nature of the property.
• Energy Performance Certificate (EPC):
  Having an up-to-date EPC in place is a legal requirement when selling a property.
• Replies to Enquiries:
  There are several forms completed by the seller as part of the initial stages of the conveyancing process which answer questions about the Property. These forms will differ depending on whether the property is a residential or business property. The appropriate residential forms are:
          
  • Property Information Form: This contains a range of information regarding boundaries, disputes, claims, notices, proposals, environmental matters and so on. 
    
  • Fixture & Contents Form: This identifies what physical items will be included as part of the sale. 
    
  • Leasehold Information Form: This form is completed when selling a leasehold property. The questions confirm what’s included in the lease documentation. 

The appropriate business property forms are Commercial Property Standard Enquiries:

• General Pre-contract Enquiries for All Commercial Property Transactions (CPSE.1): this is a long list of questions relating to the property and includes information on issues such as planning, disputes, occupiers and Value Added Tax.
• Supplemental Pre-contract enquiries for Property Subject to Tenancies for Commercial use (CPSE.2): these questions relate to the occupier(s) of the property
• Other Commercial Property Standard Enquiries may also be included such as CPSE.3, CPSE.4, CPSE.5, CPSE.6 and CPSE.7

Tenancy Information:
An auction legal pack should contain copies of any leases or tenancy agreements for occupiers of the property. In addition, if there are any other documents (such as a Licence to Assign or Sublet) these documents should also be included. 

How can I access an auction legal pack?

Usually, auction legal packs will be available to all prospective buyers through the auctioneers website. 

Usually, each Lot is listed separately. You can access the auction legal pack by clicking on the Lot Number, and that will take you to the pack. Some auctions will allow you to register for updates. This is worthwhile doing as they will generally notify you as and when an auction pack or an additional document is uploaded. 

Do be prepared as some auctioneers require you to make a payment before they will release an auction legal pack. This is usually a nominal fee, but does mean it can take longer to obtain a copy of the auction legal pack. 

At AFG Law, we are specialists at reviewing and creating auction legal packs. If you wish to sell your property or land at auction, or you wish to buy a property at auction, get in touch with our experienced team of solicitors to see how we can help you.