MUDs pre-contract enquiries for second-hand houses - new guidelines
The Conveyancing Committee has reviewed the existing conveyancing practice in relation to Multi-Unit Developments (MUDs) Pre-Contract Enquiries and has today issued a new set of MUDs Pre-Contract Enquiries for second-hand houses in managed developments.
Sale of houses in a managed development
The Committee is of the opinion that it should be possible for a vendor to provide replies to the MUDs Pre-Contract Enquiries in relation to all material issues that are likely to arise in connection with a housing development.
The Committee suggests that before solicitors seek replies to the MUDs Pre-Contract Enquiries from an OMC or its managing agent that they should explore the possibility of getting the vendor to reply to the MUDs Pre-Contract Enquiries.
Director’s Reports
The Directors of every OMC are under a Statutory obligation by virtue of Section 17 of the MUDs Act to furnish each member of the OMC with a Report ten days before each annual meeting which includes statements of:
- the income and expenditure relating to the period covered by the report;
- the assets and liabilities of the OMC;
- the:
(i) funds standing to the credit of the sinking fund, and (ii) details of the amount of the annual contribution to the sinking fund and the basis on which such contribution is calculated; - the amount of the annual service charge and basis of such charge;
- the projected or agreed annual service charge relating to the current period;
- any planned expenditure on the refurbishment, improvement or maintenance of a non recurring nature which is intended to carry out in the current period;
- the insured value of the development, the amount of the premium, the name of the insurance company and a summary of the principal risks covered;
- in general terms, the fire safety equipment installed in the development and the arrangements in place for its maintenance, and
- full disclosure of any contracts between the OMC and a director or shadow director.
A vendor who has, or can obtain a copy, of the Report under Section 17 should be able to provide replies which a purchaser and a purchaser’s solicitor may find acceptable.
Apart from what may be contained in a Section 17 Report a vendor may be aware of planned expenditure on the refurbishment, improvement or maintenance of a non-recurring nature which the OMC intends to carry out in a subsequent period and details of such works should be provided.
If the Directors’ Report does not contain all the information that it is obliged to provide under the MUDs Act the vendor should not have to pay any fee to obtain any missing details.
Purchaser’s solicitors should continue to ensure that service charge is paid or apportioned to the date of completion of the sale.
The Conveyancing Committee understands the need for an OMC and its Managing Agents to get the name and contact details of a purchaser of a house in a Managed Development. Owners of a unit in a development to which the MUDs Act applies are obliged under Section 8 (3) of the Act to provide the OMC with, inter alia, details of their name and address, particulars of the names of any tenants or habitual occupiers, and other contact particulars the OMC may reasonably request. To avoid ongoing enquiries to their vendor clients, vendor’s solicitors should ask purchasers to complete a reasonable Owner’s Contact Detail form and to provide this directly to the OMC or its Managing Agent on or immediately after completion of the sale.
The Law Society Requisitions on Title (2019 Revised Edition) are under review by the Conveyancing Committee at present. The new edition of the Requisitions on Title will include the Pre-Contract Enquiries for second-hand houses in Managed Developments issued with this Practice Note. Pending the issue of the latest Requisitions on Title solicitors should use these Pre-Contract Enquiries for second-hand houses in Managed Developments.
Precedent download
Solicitors are permitted to use precedent documents for their own internal purposes as part of their legal practice. Other than for the purposes of and subject to the conditions prescribed in the Copyright and Related Rights Act 2000 (as amended), this document (or any part of it) may not be reproduced, published, stored, distributed or transmitted by any means, in any form, without the prior permission of the Law Society of Ireland.
