The Gazette 1986

GAZETTE

JANUARY/FEBRUARY 1986

Practice Notes

Closing a Sale by Post

A sale of property is normally completed by the Pur-

chaser's Solicitor attending the Vendor's Solicitors

office. On occasions the Purchaser's Solicitor will elect

to close by post. While disclaiming responsibility for

any adverse consequences of this practice, the Convey-

ancing Committee suggests that, if the sale is to be

closed by post, the Vendor's Solicitor can reasonably

insist that the sale should be closed in the manner herein

set out. The closing procedure, which shall be described

as the 1986 Code of Practice for closing sales by post,

shall apply only where both Vendor's and Purchaser's

solicitors have previously agreed to its operation.

The sale shall be closed in the following manner:

(a) The Purchaser's Solicitor shall not later than four

days prior to the closing date send to the Vendor's Sol-

icitor a list of closing requirements (in accordance with

the replies to Requisitions on Title and subsequent cor-

respondence).

(b) When the Vendor's Solicitor is immediately able to

satisfy or meet these closing requirements, notice shall

be given (and where applicable mortgage redemption

figures shall be furnished) to the Purchaser's Solicitor

who shall then (save in the circumstances in paragraph

(c)> send to the Vendor's Solicitor a Bank Draft for the

balance of the purchase money or the balance due on

the Apportionment Account (if any).

that the Vendor's mortgage is not to be redeemed prior

to closing, the Purchaser's Solicitor should furnish to

the Vendor's Solicitor two separate Bank Drafts, firstly

for the amount required to redeem the Mortgage and

secondly for the balance of the purchase monies. This

shall imply an undertaking by the Vendor's Solicitor to

forthwith discharge the Mortgage debt to the Vendor's

Mortgagee and to furnish as soon as is reasonably pos-

sible to the Purchaser's Solicitor proper evidence of such

discharge and such release of Mortgage stamped and if

registerable in the Registry of Deeds, duly registered, as

may be appropriate.

(d) The Vendor's Solicitor will agree (without charge) to

act as agent for the Purchaser's Solicitor with a view to

receiving the Deed of Assurance oontaining the Receipt

clause. This is with a view to the Purchaser's Solicitor

getting a good receipt for payment of the purchase

monies pursuant to the provisions of Section 56 of the

Conveyancing and Law of Property Act 1881.

(e) Completion will be deemed to have taken place when

the Vendor's Solicitor has received the balance purchase

money outstanding and is at the same time in a position

to furnish to the Purchaser's Solicitor the deeds and

other items outstanding to close in accordance with the

Vendor's Solicitors replies to the Requisitions on title

and subsequent correspondence, in a position to satis-

factorily explain all acts appearing on the Searches (if

any) submitted by the Purchaser's Solicitor to the

Vendor's Solicitor for explanation, and in a position to

hand over or otherwise make available the keys of the

property. The Vendor's Solicitor should confirm by

telephone or telex to the Purchaser's Solicitor that com-

pletion has taken place and thereupon the Vendor's

Solicitors shall be entitled to release to the Vendor the

purchase monies.

( 0 After completion and until posting or other dispatch,

the Vendor's Solicitor holds the documents of title and

other items to close as Agent for the Purchaser's Solicitor,

(g) As soon as possible after completion, the Vendor's

Solicitor shall send to the Purchaser's Solicitor by reg-

istered post or as agreed the documents and other items

and the keys (or an authority to the Auctioneers to

release these) if they have not been made available on a

telephone or telex instruction after completion is deemed

to have taken place. The documents and items are sent

by registered post or as agreed at the sole risk of the

Purchaser's Solicitor.

VAT on Management Charges f or Of f i ce and

Shop Properties

The Irish Auctioneers and Valuers Institute have kindly

supplied a copy of a letter clarifying the position with

regard to the above, which may be of interest to members.

Dear Sir,

I refer to our recent discussion and confirm that, having

regard to the special features of the application of VAT

to property, the Revenue Commissioners are prepared,

as a concession,

to agree to the following arrangements

for the transmission to VAT-registered lessees of a

deduction for VAT charged on these goods and services.

(1) A landlord who is not registered for VAT and who is

not obliged to register may seek the agreement of

his Inspector of Taxes (VAT) to become registered

by concession. The application should be made by

letter to the Inspector and should give the address(es)

of the property(ies), a list of the registered tenants,

the accounting year/s and quote the registered VAT

number of the landlord, if already registered. On

being satisfied regarding the circumstances of the case

the Inspector will register the landlord. A landlord

whom and Inspector agrees to register will be allocated

a VAT number which will enable the landlord to issue

to his registered lessees

once a year,

directly or

through his management agents, invoices bearing this

number and showing VAT, where appropriate. Such

invoices will enable the registered lessees to take a

deduction for the VAT invoiced, subject to the usual

conditions.

(2) Landlords who are registered for VAT in accordance

with the procedure described above will have the

same obligations as persons who are obliged to be

registered. They will, therefore, be obliged to keep

records in sufficient detail to enable their VAT

returns to be checked and validated. In the following

instances their obligations will be somewhat modified,

(i)

Invoices

The landlords will not by obliged to issue invoices

showing VAT as they receive payments from

their lessees. Only

one

invoice showing VAT

should be issued to the lessee and this at the

end of the landlord's accounting year. Any

difficulties in this regard )e.g. changes in VAT

rates during the year, end of an accounting year

not coinciding with the end of a VAT taxable

period) will be settled by the Inspector.