Lawyer Accuses Pack Providers of 'Hijacking' the HIP

The HIP Reform Group’ draft proposal for Reform – ‘New Year, New Start’ (CLICK HERE), has it is pleasing to report, prompted positive comment and support.

The proposal that advocates the early engagement and instruction of an ‘Advisor’ and for information and documents to be available for delivery to the buyer within 28 days of the first day of marketing, has received widespread coverage, and apart from some expected negative commentary, mainly from anonymous sources, the idea seems to be hitting the right buttons.

One response that is perhaps worthy of particular note is from a conveyancer who took the time to write into the solicitors’ periodical – The Law Society Gazette (CLICK HERE).

The contributor beginning with a reference to Grant Shapps intention to abolish home information packs opened his letter by saying:

‘……….we must encourage the seller to instruct solicitors early in the selling process, which is still not happening despite the good intentions behind the HIP. Ideally the solicitor needs to get on with the ‘completion-ready’ pack before a buyer is found'.

He added:

‘We need to educate the public to understand the process and to instruct lawyers when the house goes on the market. We know of course that sellers are reluctant to incur costs before a buyer is found, so it will be an uphill struggle to change attitudes’

There are all good points and all very much in line with the theme of the HRG proposal. It is, as most supporters of the HIP will tell you, important to promote full and early disclosure of information and documents, as well as greater transparency for the consumer. The ‘smoke and mirrors’ surrounding the home selling and buying process serves no purpose, other than self interest, and must be removed.

The Property Information Questionnaire introduced back in April 2009 was a step in the right direction that clearly encourages the seller to be more involved in the process and to ask questions about procedure that were perhaps not asked too frequently beforehand.

Many consumers still find it difficult to ask their lawyer questions, some fearing it will add to the cost, whilst others find their lawyer unapproachable or too busy. Many lawyers run large caseloads in an effort to make their conveyancing practices profitable, and therefore do not have the time to engage with their clients as much as they would like.

Energy Assessors often say they are asked about the selling and buying process and to explain the purpose of the home information pack. Once explained and with a better understanding the seller acknowledges the benefit of delivery of upfront information and goes away feeling more involved.

Back to the letter and the part where the correspondent accuses pack providers and other involved in the industry of ‘hijacking’ the HIP. He claims:

‘HIPs were certainly hijacked by interested parties. These people were not lawyers and, as we now know, HIPs were introduced with little regard for the views of the legal profession. Sadly the product fails to serve anyone in the conveyancing process other than those who hijacked it. Only the energy certificate should be required at the marketing stage, although even that is of little value’.

Sorry, but this makes little sense. The legal profession was, and remains, better placed than most to adopt and run with the home information pack and use it as what has clearly been shown, by many other lawyers, to be a powerful and effective marketing tool.

Apart from the EPC, the HIP comprises of legal documents and information. Who better to deliver this than a lawyer!

Many lawyers like myself toured the Country before and after the introduction of the HIP, speaking to large groups of lawyers and stressing the importance of embracing the HIP and making it the number one priority in future business planning.

Did they listen? No they did not, well the majority did not, dismissing the HIP at the time as a requirement that would never work, and generally as an unwelcomed change.

Those who did listen have despite the recession done very well and have preserved and increased their conveyancing caseloads.

One of the main problems was the failure of the Law Society to get behind the HIP and to encourage solicitors across the country to seize the opportunity. Unfortunately the Law Society is not the quickest body on the block and is often more influenced and driven by politics than its membership.

In its defence, and for me to defend the Law Society it a rare occurrence, there is it seems quite a large amount of apathy within the legal profession. This was illustrated quite vividly in steps taken by the Law Society in the latter part of last year when it issued a Consultation Paper – ‘Improving Residential Conveyancing (CLICK HERE) inviting its members to comment on such proposals as a ‘Completion Pack’.

Bearing in mind there are over 12,000 plus solicitors practicing in this country how many responses do you estimate they received? Was it 6,000, or 3,000? Wrong! There were only 354 responses!

The Results of the Survey was even more surprising with the majority of those responding saying they did not see there was a problem with the process and that there was little that could be done to improve it.

Commenting on the timeliness of the exchange of information it was noted

‘…. around three quarters of respondents (74%) did not believe that this could be improved. Just over two thirds of respondents (69%) strongly disagreed’ or ‘disagreed’ that an agreed protocol would make conveyancing more efficient. Half of respondents disagreed that an electronic infrastructure for document exchange would speed up transactions’.

In conclusion it is hard to see any justification in the accusation of ‘hijacking’. The HIP was introduced in 2004 with the promulgation of the Housing Act. This left plenty of the time for conveyancing lawyers to plan and prepare so as to be first in the queue, and well ahead of the ‘interested parties’. Just because the majority failed to act, invest time and money and take the risks as many others have, it is hardly a basis for valid complaint. There was no hijack, it was more akin to a horse race where the favourite horse failed to leave the starting stalls.

Related Article: A Review of the Law Society’s Consultation Paper: CLICK HERE