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Registering real property charge documents under COVID19: guidance for lenders

View profile for Sally Bradshaw
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The current situation, where we are all social distancing, clearly presents a number of challenges for lenders looking to register real property charges with the Land Registry. And the absence of any change to the time limits for registrations only exacerbates things. But hope is not lost and there are some potential workarounds for lenders to consider.

Challenge 1: The proprietor of the property must sign the charge and their signature must be witnessed

There are obvious difficulties in getting documents signed with a witness presently. Among these are the lack of availability of an independent witness and how the person seeking the benefit of a charge verifies that the statutory requirements for the validity of the charge have been fulfilled. It may be possible for two individuals representing a limited company to validly sign a charge on behalf of a company without meeting to do so by executing the charge as a deed in counterparts. It is harder for a company with a sole director or an unlimited partnership to do so.

Challenge 2: A witness’ signature needs to be verified and certified

There is material risk to lenders if a witness is not independent so they will want safeguards that the witness does see and attest the signature of a signatory. However, that does not stop unscrupulous collusion between the witness and the signatory where the witness is not independent. There are, however, ways to minimise such issues using tools and processes through which lenders can seek to overcome this risk amidst a lockdown.

You cannot obviate the legal requirements to ensure validity of documents but you can seek to protect yourself from later challenge over them.

For further guidance on registering real property charges under COVID-19, do get in touch with Sally Bradshaw.

For further guidance on how you can ensure valid execution of deeds and other documents, please get in touch with Chris Willison.