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serious difficulty. He instanced several cases in
which he had made pre-contract enquiries as to
whether any such matters existed and which the
answer revealed the existence of an easement that
would have seriously frustrated the purchaser's
intended development of the property. As a result
the sale fell through. Tn another case the answer
was that no such matters existed and the contract
was signed on that understanding. It subsequently
turned out that a right of way existed which was
a serious obstacle to intended development. For
tunately the matter was resolved after consider
able difficulty.
Counsel who settled
the standard conditions
commented
that the standard condition about
easements only protects the vendor from having
to conduct inquiries as to the possible existence
of easements of which he is not aware. In the case
of those of which he is aware he must disclose
them and furnish any information relating thereto
in his possession. Here again, the condition, is of
considerable antiquity. Member also referred to
the clause in the standard conditions which says
that the last receipt for rent shall be conclusive
evidence of the performance of leasehold cone-
nants affecting
the property being
sold and
pointed out that the Conveyancing and Law or
Property Act 1881 only makes the last receipt
prima facie evidence. He thought that it would
be more equitable that the standard conditions
should follow the terms of the conveyancing acts.
Counsel to whom the matter was referred poin
ted out that the last receipt condition in the stan
dard conditions has been in existence for at least
one hundred years and is in universal use and
that its validity has been judicially upheld. He
pointed out that the conditions of sale are in
tended to prevent the vendor from being put to
unnecessary and possibly serious expense at the
hands of a persistent or even vindictive purchaser
and are primarily designed for sale by auction but
equally necessary in the vast majority of moderate
sized private sales. In large sales the purchaser
will be in a position to refuse to accept any
conditions which, in the circumstances, a solicitor
advises him not to accept. He may of course lose
the purchase but in such a case it becomes a
matter of bargaining on each side.
The main advantage to standard conditions is
that
their contents become universally known
throughout the profession. Any variations in the
printed form can be immediately detected and
negotiated between the solicitors for the parties.
For convenience it is suggested in the printed
notes at the head of the conditions that altera
tions should not be made in the printed text but
should be incorporated in the appropriate sche
dule at the end where there is ample room for
amendments and additions.
PROFESSIONAL INDEMNITY INSURANCE
An award of £25,000 to a victim of a road
accident or a £100,000 property transaction are
now so common, that it will merit only two or
three paragraphs on the inside page of the daily
papers. The significent aspect of such news for
the solicitor is that the value of the claims and
property with which he is dealing is constantly
rising. At the same time the law increases
in
complexity and however careful the Solicitor may
be there is no guarantee that once in his pro
fessional career he will not make a mistake. While
most Solicitors carry professional indemnity in
surance in many cases the amount insured is woe
fully inadequate. The amount up to which cover
should be taken depends on the circumstances of
the individual practice, but bearing in mind the
high damages awarded every day in the High
Court and the increase in value of property few
practices can afford to be covered to less than
£20,000.
If you feel that you are covered sufficiently as
to amount you might wish to adjust the scope of
your cover. The following are some risks which
the basic professional indemnity policy will not
cover but which for an additional premium can be
covered by an extension of the policy.
(a)
Libel and Slander
In Groom v. Crocker (1938) 2 All E.R. 394,
the plaintiff collided with a lorry belonging to X
in such circumstances that X was clearly at fault.
X
lodged £100
in Court which
the plaintiff
accepted. The plaintiff's brother was a passenger
in the car at the time and was injured and brought
an action against his brother and X. The insurers
agreed between
themselves
that
the brother's
claim and another claim should be shared bet
ween themselves; to effect this it was necessary
for the plaintiff's solicitor, Crocker, to admit that
at the time the plaintiff was driving negligently
and this he duly did. When the Plaintiff heard of
this he sued his Solicitor
for
libel and was
awarded £1,000 damages.
It is possible that a Solicitor could incur serious
liability in this way. Several forms of libel and
slander cover are available. The extension
is
normally given for a percentage additional pre-
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