Commercial Property replies to enquiries
On almost every sale or lease of commercial property (whether that be offices, a shop, warehouse or farm etc.), the buyer’s solicitor will ask the seller’s solicitor to provide replies to a standard set of enquiries.In most cases, these are replies to general Commercial Property Standard Enquiries (CPSE), although there are different numbered versions of these standard enquiries, depending on the nature of the transaction.There are also additional sets of enquiries where the property is subject to one or more leases, and if the transaction involves the grant of a lease.Where the transaction involves agricultural land, a different set of enquiries more specifically dealing with agricultural land may be used.
The standard CPSE enquiries are updated from time to time but currently run to 34 pages.When acting for a seller/landlord, we will try to draft initial replies to the enquiries on behalf of our client.However, we then always need to send them to our client, to review and confirm that the enquiries given are correct and to provide replies where we are unable to answer them from the information we hold.
It would be fair to say that most clients receive a request to complete CPSE with a groan!They are time-consuming to complete, and many of the enquiries may not seem relevant to the particular transaction.However, all sellers/landlords need to be aware that the buyer/tenant is entitled to rely on the replies given, to assume they contain all relevant information of which the seller/landlord is aware, and to assume that the seller/landlord has made all necessary enquiries when completing the replies.They therefore need to be treated seriously and completed as fully as possible.If the seller fails to reply with information of which it is aware or gives a misleading reply, this could potentially give the recipient the right to terminate a contract and/or to be entitled to damages (depending on the circumstances and the nature of the information).
At the beginning of the CPSE there are various written statements, which include one that if the seller (or landlord) becomes aware of anything which may cause any given reply to be incorrect before exchange of contracts (or if there is no contract, before completion), then the seller (or landlord) must notify the buyer (or tenant) on becoming aware of any such thing.It is therefore important that you notify your solicitor if you become aware of any matters that may change any replies previously given.
In addition to replies to CPSE, the buyer/tenant’s solicitor are also likely to raise specific additional enquiries.However, you should not wait to see whether any specific replies are given – if you are aware of anything that you think may be relevant to the transaction, this should always be disclosed in the replies to CPSEs.
For further information please contact Victoria Sandberg.
Please note the contents of this blog are given for information only and must not be relied upon.Legal advice should always be sought in relation to specific circumstances.