Royal Bank of Scotland Conveyancing Panel Information

We can't comment specifically on Royal Bank of Scotland. Many major lenders are now introducing ‘file auditing’ as standard practice in relation to completed matters. This raises questions of confidentiality in relation to the buyer client and the purpose to which the results of such audits will be put. The starting point is to remember that the file does not belong to your firm, it belongs to the ‘client’. But, of course, we will normally have two clients – the buyer and the lender - and you will owe a duty of confidentiality to each. So basically, you have to separate the file and just send the lender the parts solely relating to themselves. But, of course, as this will basically be correspondence with the lender, mortgage instructions etc.

Check with your COLP but a firm should not send the complete conveyancing file without the buyer client’s express consent – and if she is in dispute with the lender he is hardly likely to agree. However, if the lender can establish a prima facie case of fraud, then you may be under an obligation to disclose the whole file.

The emerging convention is that lenders are including an authority to disclose in loan application forms to counter this problem. Mortgage Express v Sawali, [2010] EWHC 3054 (Ch) indicates that such provisions are valid. Please click here for more information about that case.

What you should do largely depends on the reason that your firm has been removed off the Royal Bank of Scotland conveyancing panel. The top 3 reasons are as follows:

1. lack of transactions
2. the lawyer is a sole practitioner
3. as part of the HSBC panel reduction.

In these three circumstances it is unlikely that you would expected to take any action. Disclosure and other compliance considerations are more likely to be relevant if the reason for removal is due to breaches of lender requirements or allegations of fraud or negligence. Whether the reasoning should trigger a disclosable 'material' breach will depend on the firm and the circumstances around possible failures to comply with the SRA Authorisation Rules, and the SRA will judge each case on its own merits. Factors such as the detriment or risk of detriment to clients, the scale of the issue and overall impact on the firm will need to be considered in deciding whether a failure is 'material'. As the compliance officer you will need systems to identify patterns of breaches. Even if you don't consider there to be regulatory implications the firms COFA should give some thought to whether she/he needs to take any action as result of being removed from the Royal Bank of Scotland conveyancing panel.

You have a number of obligations in this regard which are to followed if you wish to comply with your lender client’s instructions as set out in the UK Finance Lenders’ Handbook. (I) You must take reasonable steps to verify that there are no discrepancies between the description of the property as valued and the title and other documents which a reasonably competent conveyancer should obtain, and, if there are, you must tell Royal Bank of Scotland immediately. Second, You should take reasonable steps to verify that the assumptions stated by the valuer about the title (for example, its tenure, easements, boundaries and restrictions on its use) in the valuation and as stated in Royal Bank of Scotland’s mortgage offer are correct. If they are not, please let Royal Bank of Scotland know as soon as possible as it will be necessary for Royal Bank of Scotland to check with the valuer whether the valuation needs to be revised. Royal Bank of Scotland conveyancing panel solicitors are not expected to assume the role of valuer. Royal Bank of Scotland are simply trying to ensure that the valuer has valued the property based on correct information. (III) Royal Bank of Scotland recommend that you should advise the borrower that there may be defects in the property which are not revealed by the inspection carried out by their valuer and there may be omissions or inaccuracies in the report which do not matter to them as a lender but which would matter to the borrower. Royal Bank of Scotland recommend that, if we send a copy of a valuation report that Royal Bank of Scotland have obtained, you should also advise the borrower that the borrower should not rely on the report in deciding whether to proceed with the purchase and that he obtains his own more detailed report on the condition and value of the property, based on a fuller inspection such as a homebuyers report or comprehensive survey. If you do not receive a copy of the valuation you can always ask for a copy of one from Royal Bank of Scotland or the borrower. You still need to comply with the UK Finance Lenders’ Handbook Requirement relating to valuation reports even if you don't receive one directly. Failure to comply not only runs the risk of facing a claim by the lender but also being removed from the Royal Bank of Scotland conveyancing panel

With banks and conveyancing firms working so closely together it is surprising that there has not been greater demand for the introduction of a bit of transparency regarding not just the figures for the Royal Bank of Scotland conveyancing panel but for all lender panel listings

CQS accreditation is no guarantee to lender panel acceptance. Nevertheless the CML have indicated that it is likely to become a prerequisite for firms wishing to remain on their panels. Some Lenders now use the scheme as the starting point for Panel membership as is the case with Santander.

You would be advised to communicate with Royal Bank of Scotland to obtain standard documents. The CML Handbook has an express question for lenders to cite who to contact to obtain standard documents. Royal Bank of Scotland in their Part 2’s state: Please remember to quote your Royal Bank of Scotland conveyancing panel reference.