We have recently seen a bill from one of our “competitors” – a conveyancing practice that only deals online. We have acquired a former client of theirs and have been asked to investigate, clarify and resolve problems with the apportionments of rent and service charge and arrears that should have been paid by the seller when the client bought the property.
Apart from the fact that the competitor did not ensure the seller paid his liabilities so the buyer was not landed with them, we found the bill astonishing. The transaction was the purchase of a leasehold flat at a price of £350,000. Our fee for that work would be £1,595 (including the £500 we charge for the extra work involved in leasehold transactions) plus £35 per same-day funds transfer plus VAT on each – a total of £1,956.
The other firm quoted a “headline” figure of £950 + VAT, but then came the add-ons –
- £750 + VAT for the leasehold aspects – as against our £500 + VAT
- £12 + VAT for an anti-money laundering check – this is essential work and an overhead, and should not be charged in addition
- £45 + VAT for storing the file after completion – which conveyancers are obliged to do anyway: another overhead charged as an addition
- £20 + VAT for arranging a chancel repairs indemnity insurance policy – on top of the premium for that policy
- £20 + VAT for registering the client’s purchase at the Land Registry – an essential part of the transaction, not a true extra
- £99 + VAT for registering a fraud restriction against the title – despite the fact that this can easily be done as part of the essential registration
- £10 + VAT for sending formal notice of the change of ownership to the landlord – another extra, despite charging extra for the leasehold work
- £75 + VAT for submitting the Land Transaction Return for SDLT purposes – another essential part of the process, not an optional extra
- £125 + VAT “SIM fee” – we assume this is an exorbitant charge for carrying out a search of the Land Registry’ index map, though the Land Registry’s own £3 fee for this was not included, so we wonder whether such a search was carried out
- £45 + VAT for a same-day funds transfer – on a par with our £35 + VAT, really
In all, the other firm charged £2,629.20 including VAT, compared to our £1,956, which is £673.20 more, despite the headline fee of £950.
It pays to check exactly what is included and what is extra when getting legal costs estimates.
29 August 2017