The FPA develops new interactive website

By Mary Dhonau, OBE

With the future availability of flood insurance hanging in the balance, there is now a much greater need for home owners and businesses to think about protecting their own properties. Being flooded is an appalling experience and taking moves to mitigate against the many months of misery and business interruption that flooding brings with it, is surely a sensible option!

Many people are totally baffled and just don’t know where to begin to protect their own properties (apart from using a humble and inefficient sandbag). The Flood Protection Association (FPA), a non- commercial trade body which represents the flood protection manufactures and promotes best practice and innovation within the industry, would be a good first port of call!

The Flood Protection Association has developed an interactive website for both domestic and commercial use. The user can simply hover the mouse over any part of a property where water can enter (e.g. an airbrick – where an astonishing 5,000 litres of water an hour can enter a property) and immediately be guided to a selection of approved companies who specialise in supplying protection for that area. Most of the FPA members have a Kitemark, which is a stringent testing regime that tests flood products to a set criterion.

It is essential before attempting to protect a property that a property level survey is undertaken to assess where the water comes from.  After all, it is no good protecting the doorway of a property if the water comes from underneath! The FPA has suitably qualified members able to undertake such surveys. 

The interactive website also gives information about flood risk and sources of flooding and has a direct link to members own websites. Please do visit http://thefpa.org.uk/ for further information. 

The changing world of probate research. Fraser & Fraser celebrates 90 years at the top of its profession.

By Johanna Lines, Marketing & Business Development Manager, Fraser and Fraser

May 2013 marks an important milestone in Fraser & Fraser’s long history.  As we celebrate our 90^th year, it seems fitting to take a look back at how our business has evolved to meet the ever changing needs of this industry while at the same time continuing to deliver the high standards demanded by the legal professionals we support.

In 1923, Gertrude Christensen, great aunt of today’s working partners, took the ambitious step of founding her own firm. Due to her experience, employed as an Outdoor Clerk carrying out genealogical research for a law firm, she was confident that through using her tried and tested methods, she had the expertise needed to support lawyers in their work. In 1969, a new partnership was formed with her nephews, Nathan and Simon Fraser, at the helm. Under their management, Fraser & Fraser continued to lead the way in probate research in the face of an ever changing society. Increasing divorce rates, emigration, immigration and population growth all made searching for missing beneficiaries more of a challenge, and together they grew the firm’s expertise to overcome these obstacles.

Since 2007, the firm has been managed by the latest generation of Frasers: Andrew, Charles and Neil.  Like previous generations, these current partners are forward thinking and share their family’s passion for research, but they also bring with them the technical knowledge needed in looking for new and innovative research solutions. These solutions mean that we can research more effectively at greater speed than ever before, and this technology is just one of the ways we ensure we stay ahead of the competition.

There is no doubt that the internet and increased media coverage have contributed to revolutionising the world of genealogy. TV programmes such as Heir Hunters and genealogy websites that allow users to research their own family trees are extremely popular. This technology is essential in helping us to reduce costs, speed up the search process and increase communication, but these factors have also led to an increase in small, amateur probate research firms arriving on the scene. Experience has shown us how important it is for solicitors to be able to choose a firm that they can trust and have confidence in.

We have built up a network of European offices and relationships with other leading genealogists worldwide, which we continue to grow and advance to this day, with the aim of enhancing both the service we provide and the reach of our research. In developing our now vast portfolio of services we have worked with specialist firms such as Landmark and property companies. These services help us to better support our clients by ensuring we are able to support in all aspects of estate administration and not only the research for which we are best recognised.

Despite many changes in this field over the last 90 years, some things have stayed the same. We have upheld the Fraser family’s vision by offering dedicated support to probate professionals in the UK and overseas and we continue to grow, but the firm still remains in the hands of the family that started it up in 1923. At the grand age of 90, Fraser & Fraser are proud to say that we continue with the same values and aims forged by Gertrude all those years ago: to be and always be a trusted and reliable partner to the legal profession.

For more information about Fraser & Fraser and our services, visit our website: www.fraserandfraser.co.uk

Or contact us to discuss how we can help you:

Email: legal@fraserandfraser.co.uk          Tel: 020 7832 1430

In his fourth blog, Andy Lucas, Managing Director of Property Assure, continues his look at the effect of spring and the largest trigger of subsidence – trees and vegetation.

In our last blog we looked at how trees and vegetation influence subsidence.  As we rapidly approach the key growing period we will look at risk mitigation and the impact of legislation and ownership.

Where there has been previous subsidence or the property is in a high subsidence risk area we need to consider the extent and type of trees where the building sits in their zone of influence.   If extensive or of concern it is advisable to consult an arboriculturalist.  Some key considerations are:
• If the trees are too close and were planted after the building was built they should be relocated.
• If the trees are too close and were planted before the building was built they could be managed by pollarding and crown thinning.  They should not be removed without specialist advice as this could cause uplift of the ground (i.e. heave) which can result in structural damage.

If the property owner is considering planting young trees this needs planning as although they will not extract sufficient moisture initially to present a risk, this may readily change as it grows. It is a common myth that a new home cannot be affected by subsidence for this reason.

There are, however, further considerations.

A tree with a Tree Preservation Order (TPO) or in a Conservation Area can never be removed or altered without consent from the relevant Local Authority.  It is recommended to check with the Local Authority and establish if there are any such restrictions during the purchase process – if this is the case it is pertinent to understand how the trees can be managed to mitigate risk.

In addition the property may be affected by trees that are not within the owner’s property boundaries.  This either involves a neighbour or the Local Authority.  There are a number of Case Studies (Russell vs. London Borough of Barnet 1984) which set a legal precedent - the key driver is tree owner’s awareness of nuisance.  Local Authorities, for example, are deemed to have the necessary technical knowledge regarding trees and their effect on property.  Even so mitigation in respect of Local Authority trees can be problematic as the removal of trees is contentious and residents regularly challenge their removal.  They require a considered response with an amount of information to be provided.  

So the first step is to understand the subsidence risk and then take into consideration any trees within the zone of influence.  It is important that such risks are taken into consideration before the onset of any new growing season, so the risk (or associated costs of risk management and repair) is realised and managed from the outset.   If numerous trees exist on a property then specific arboricultural advice may be required.

Visit www.subsidencesupport.co.uk for more guidance and advice on Subsidence.
Andy Lucas Managing Director at Property Assure Ltd

Part 2A – A year on

By Professor Paul Nathanail University of Nottingham; Land Quality Management ltd

In April 2012 the second revision to the statutory guidance underpinning Part 2A of the Environmental Protection Act 1990 in England and Wales came into effect.  As well as finally allowing changes made by the Water Act 2003 to the provisions for protecting controlled waters to come into effect, the guidance updated the definition of what constitutes a ‘significant possibility of significant harm to human health (SPOSH).

Following decades of uncertainty for the contaminated land management sector about the meaning of 'unacceptable intake', Defra and the Welsh Government replaced the one phrase with a narrative definition of what constitutes statutory contaminated land. Land is placed into four categories: categories 1 & 2 represent a SPOSH; land in category 4 poses a sufficiently low level of risk not to warrant remedial action, while land in category 3 poses a level of risk that is neither so low nor sufficiently high to merit regulatory intervention under Part 2A.

The new guidance, coupled with updated planning guidance in both England (National Planning Policy Framework, March 2012) and Wales (Planning Policy Guidance, November 2012), has led to both regulators and practitioners to review their approach to risk assessment.  While the Part 2A changes are intended to encourage Local Authorities to focus their ever-scarcer resources on the sites likely to be posing the very highest risks, the changes to planning guidance reiterate the need for developers to demonstrably ensure sites are safe for their intended use. The context in both cases was desired to encourage sustainable reuse of land and avoid unnecessary remediation.  The key to delivering both in a cost effective manner is a sound conceptual site model where full use is made of available information about a site's history and ground conditions.

The guidance has been accompanied by a series of Defra-commissioned research projects and a renewed interest in training regulators and practitioners after a couple of years of anticipation and expectation. All in all the changes represent a stimulus to the sector that will stand it in good stead over the next few years of difficult economic conditions where the right decisions will need to be made promptly.  Those developers and regulators who appreciate the value of robust and reliable information to underpin their risk assessments will be ideally placed to benefit from the changes.

Professor Paul Nathanail combines research and teaching at the University of Nottingham with being managing director of Land Quality Management ltd.

Simplification of CRC - what's happening and when

By Victoria Joy, Consultant

The 2,100-odd participants in the CRC Energy Efficiency Scheme have been waiting for the outcome of the simplification exercise announced soon after the last General Election.  The rules of the scheme, which is mandatory for public and private sector organisations that consume electricity above a threshold level, are notoriously complex and the incoming government promised to do something about them.  The first major change was to turn the CRC into a quasi-tax that cost participants £675 million in 2011/12 through a £12 per tonne charge on their emissions of carbon dioxide, but the next set of changes should be more welcome.

The government consulted on CRC simplification last year and published its response to the consultation exercise shortly before Christmas.  Now, draftlegislation has been laid before Parliament and the devolved administrations with the intention that it will come into force by June.  Most of the revisions will not be made until the next phase of the scheme which starts in April next year, but some changes are planned to take effect immediately and will affect the reporting of 2012/13 data this summer - assuming the draft legislation reaches the statute book in time and without significant amendment.  Chief amongst these early changes is a reduction in the number of fuels caught by the scheme from 29 to just two: gas used for heating and electricity.  But, thanks to the abolition of the 90% rule, all non-core heating gas and electricity supplies will now have to be reported, subject to a 2% de minimis for gas.

Many CRC participants already use Landmark's Carbon Counter to help them manage and report on their organisation's energy consumption.  Sign up for one of our webinars in which the simplification changes and the role that Carbon Counter can play will be explained.  

Environmental concerns – what do lenders need to know?

 By Mark Milner, CEO of Landmark Information Group

With the recent high profile floods and the increasing number of brownfield site developments, there is an argument that environmental risks should be considered before a mortgage offer is made. Mark Milner, CEO of Landmark Information Group, discusses the issues

Over recent months, the topic of flood risk has been high on the agenda due to the successive bouts of rain that have brought widespread disruption and, for many homeowners, devastation.

During 2012, we witnessed the wettest spring on record, followed by additional rain in July, September, October and December, which brought weather warnings and flood alerts to regions across the country.

While flooding is particularly prominent in everyone’s minds at present, it is just one of many ‘environmental’ risks that are today facing homeowners, purchasers, and of course, the lending community.

Environmental concerns, such as flood risk, land contamination, pollution or subsidence could have adverse effects on the value or saleability of the home in question, or at its worst, even impact on whether a property is considered suitable for mortgage security.

One example of this recently featured on the BBC’s One Show, which highlighted the impact of abandoned coal mines on residential property values and mortgage lending. It reported how some homes are today unsuitable for mortgage security due to their proximity to disused shafts, which is having a knock-on effect for those looking to sell or buy properties within at-risk zones.

In fact, according to the Coal Authority, 7.7 million properties are located across coalfields, of which two million may face risk of potential problems as a result of previous mining.

Separately, a study by LV= revealed that over the next decade approximately half a million homes are set to be constructed on brownfield land that could pose future flood or contamination risk to homeowners, illustrating that this is an issue we are likely to see more of in the future.

Valuation process

With this in mind, we believe that the time is right for mortgage lenders to consider incorporating environmental risk-based due diligence into the existing valuation appraisal process. Currently, the valuation process doesn’t necessarily include due diligence regarding environmental concerns, and any risks may only be unearthed later on when the conveyancing process is fully underway.

From the surveyor’s point of view, they will only incorporate environmental information into a valuation report if they have personal knowledge that such issues exist. It is, however, not a standard requirement. Instead, the valuation is a simple physical inspection of a property, which confirms to the lender that the property’s value is sufficient security to cover the mortgage that has been applied for.

With such recent high profile floods and the increasing number of brownfield site developments, it creates an argument that environmental risks should be considered before a mortgage offer is made.

We believe there is scope, and a number of potential advantages, to integrating electronic environmental data within the existing valuation process, upfront. This could include flooding and coal mine reports as well as contaminated land studies.

When you look at the scale of the problem, specifically regarding contamination, it has been identified that more than half a million homes in the UK are located in proximity to current or former producers of toxic waste and more than 400,000 homes have been built on former landfill sites*.

As for flooding, the facts speak for themselves: according to the Environment Agency, at least five million people live in flood risk areas in England and Wales. On average, reports of flooding are now twice as frequent as they were 100 years ago, and property, land and assets which are ‘at risk’ equate to the value of £214 billion**.

Environmental reports

Currently, as part of the home buying process, environmental reports would be accessed at the conveyancing stage. Therefore, any potential hazards associated with the property may not be clearly identified until late in the home buying process.

A recent survey from Landmark Information Group raised some interesting points on this very matter however, as it identified that while 80 per cent of UK homeowners stated they would not buy a house that was at risk of flood, only 42 per cent of people actually investigated their flood risk before buying their home. It also found that 55 per cent of buyers expect their solicitor to investigate a property’s flood risk automatically as part of the conveyancing process.

This certainly raises alarm-bells that not enough due diligence is being undertaken prior to the completion of a property sale and so not only are homebuyers at risk of unearthing potential issues once they have moved into the property, but also mortgage lenders are at risk of accepting as security on a property whose future valuation could be compromised by such factors.

Ultimately, a property may tick all the boxes in terms of its nature and structural condition, however, lenders could be unaware that they are lending on a property that has been built on top of historical industrial works and a plethora of contaminants are waiting to be unearthed in the property’s back garden.

We believe that both lenders and insurers will have greater peace of mind and security if environmental information is automatically provided up front to chartered surveyors as part of the mortgage valuation instruction, as well as incorporated into automated valuation models for the cases that are managed via this route.

Electronic desktop reports could be fed directly into the existing process and could include everything from flooding reports and contaminated land studies, through to bespoke data extracts that trigger enhanced due-diligence workflow.

Localised data

Ultimately, we believe that by enabling surveyors to automatically receive localised, intelligent data that provides both historical and current information on a property and its immediate area, more accurate valuations can be passed to mortgage lenders for processing.

For example, if a property has been identified as being on contaminated land, it is the owner that is responsible for all associated clean-up costs. Therefore, if reports outlining such risks are provided as part of the valuation, a lender can review the affect this may have on the value of the asset and adjust loan-to-value parameters for a given product accordingly.

This will ultimately deliver a more detailed, dependable and informed valuation on which lenders can base their mortgage offer and means they should not be caught out by a property’s unknown history or unapparent environmental risks.

*Homecheck Professional Contamination Report http://www.homecheckpro.co.uk

**Homecheck Professional Flood Report http://www.homecheckflood.co.uk/flood_risks.html

Birmingham Law Society Legal Awards

Tony Rollason,our man on the ground, provides his account of the evening


We extend our congratulations to Sydney Mitchell LLP who won the Law Firm of the Year (5-15 partners category) that Landmark sponsored at the recent Birmingham Law Society Legal Awards.  Sydney Mitchell LLP, commercial & residential property and wills & probate specialists, previously won the award in 2008 and 2011. Sydney Mitchell specialist teams include commercial property and their private client teams include residential property and wills and probate.

The Birmingham Law Society Legal Awards, attended by over 500 legal professionals, took place at the ICC Birmingham. The host for the evening was ITV weather presenter Emma Jesson and the speaker Baroness Helena Kennedy QC a leading Human Rights Lawyer.

In the other award categories Eversheds LLP was named law firm of the year (16 partners or more), beating off competition from Gateley LLP, Irwin Mitchell Solicitors, Mills & Reeve LLP and SGH Martineau LLP.  The award for Law Firm of the Year (Sole Practitioner to 4 partners) was awarded to Jayne Willetts & Co Solicitors.

In the individual categories, Olwen Dutton of Bevan Brittan LLP won partner of the year, while Clive Garner, partner at Irwin Mitchell Solicitors, won international lawyer of the year.  James Dixon,  barrister at No5 Chambers, was awarded the title of pro bono lawyer of the year, with Adam Fisher of Wragge & Co LLP, winning assistant/associate solicitor of the year, and Michael Vale of Sydney Mitchell LLP picking up chartered legal executive of the year.

In the final two categories, Tariq Sadiq from St Philips Chambers won barrister of the year and Abisola Latunji of SGH Martineau LLP was named trainee solicitor of the year.  There was also special recognition for Peter Wiseman, who was awarded the Birmingham Law Society lifetime achievement award.

And The Survey Says…

Latest research from the Royal Institute of Chartered Surveyors (RICS) has highlighted a worrying trend with regards to consumers’ knowledge and use of building surveys when purchasing a property. 

The research identified that almost one third of home buyers fail to commission a survey prior to completion, and of those, a fifth result in owning a home that they would not have purchased, had they have been fully aware of the property’s true condition.

It was also identified that whilst almost one third of home buyers are not commissioning a survey when buying a property, 94% agreed that it was an important thing to do.

If buyers are purchasing homes without the foresight offered by a building survey, it could lead to subsequent financial pressures if they are then faced with urgent repairs or maintenance that they hadn’t accounted for. On average, the RICS research found that remedial work costs an average of £5,750.

To highlight the risk at the other extreme, a well-publicised example focuses on Ridgemont House, which is situated on the cliff tops of Torquay.  In 2010, the 1930’s property was purchased for £154,000 at auction via a telephone bid. The purchaser did not undertake a viewing or commission any structural reports or surveys, even though the auction particulars stated that the property was “severely structurally damaged” and potentially “beyond economic repair”.

In a matter of days of the new owner moving in, a landslide meant the property was dangerously close to the cliff edge and so not safe to live in. This month, following months of legal battles between the buyer and seller, the latest reports confirm that the property has succumbed to the elements, with another landslip pulling a majority of the home in to the sea below.

While this is a rather extreme case, it does illustrate the need to continue educating consumers as to what surveys are available to them when purchasing a property, and the benefits of commissioning them.   It is also important to stress that the valuation survey is for the benefit of the mortgage lender, in order to confirm that the property is worth the value of the loan’s security, and does not in any way provide structural or condition-based information to the buyer.

At the end of the day, it pays to carry out a survey on what is likely to be the most expensive purchase you will ever make.

A helpful guide from Which? that outlines the range of Surveys available can be found here:

http://www.which.co.uk/money/mortgages-and-property/guides/how-to-buy-a-house/house-surveys-explained/

Cloud Computing: What does it mean for financial services?

Part 1

The rapid shift in attitude towards cloud computing continues with the financial services industry being no exception. Cloud adoption remains one of the top priorities for CIOs, so our Cloud Computing blog series explores why financial services and related businesses have not fully adopted cloud offerings for their mainstream applications and services thus far:

Why Cloud?

From a technical perspective, cloud platforms automatically assemble, connect, configure and reconfigure virtualised and logical technology resources to accomplish business goals.

From a business perspective, it eliminates constraints relating to where physical IT resources are located or what specific technologies they employ. This enables the low-cost creation and deployment of new business services on previously unthinkable timescales.

Organisations that need to focus on efficiency and drive their growth strategy by becoming more flexible and agile, developing new markets, channels and products need this kind of flexible and cost effective technology enabler in order to remain competitive in this highly dynamic market sector.  Being first to market can often be the real differentiator and the adoption of cloud platforms is one tool available to financial services businesses, which can assist in this endeavour.

A private Data Centre is more secure, or is it?

The words ‘Public Cloud’ are often used these days, what does that mean to financial services CIOs?  It means, open, available, accessible, uncontrolled and insecure.  The word ‘Private Cloud’ means closed, unavailable, inaccessible, controlled and secure.  Let’s try to dissect the real differences here.

Data Centre infrastructure located within a private or co-location Data Centre is controlled by physical and logical security and access is via a controlled physical entrance or firewall controlled networks.  Often privately owned Data Centre facilities have weak or limited security measures, albeit dedicated co-location facilities typically have improved measures despite the shared nature of their offerings.

In contrast the larger public cloud-computing providers have dedicated, highly secure and expansive facilities globally placed where client access to such are extremely limited and controlled.  For the financial services sector, such controls lend themselves extremely well to adoption confidence:

•             Global footprints

•             Highly secure and controlled access (customer access to the actual compute floors is limited if available at all)

•             Designed, built and operated with scale and efficiency at the forefront

•             Transparent and auditable operational practices

In reality this means the key cloud operators such as Microsoft, Amazon, Rackspace, and Salesforce have physical and secure Data Centre facilities as well as operational practices that cannot be easily matched without prohibitive levels of investment.

Do probate professionals understand the HMRC declarations within IHT forms

Gerard Faulds is a founding Director of Landmark Financial Asset Search. Today he asks the question ‘Do probate professionals understand the HMRC declarations within IHT forms?’

The supporting exploratory notes provided by HMRC to assist in the accurate completion of IHT forms are 84 pages long. How frequently do you refresh yourself as to their contents?

You may regularly complete IHT 205 and 400 forms but do you read and understand some of the statements and declarations which you are agreeing with?

The IHT forms and exploratory notes do not say “based on the papers provided to you, did the deceased have….” The following are specific questions from the IHT 205 and 400 Forms:

“Did the deceased have any provision for retirement other than the state pension?”

What if the deceased paid into a pension scheme for many years but had stopped making payments into the plan and was not already drawing a pension from the scheme?

“Did the deceased pay premiums on life insurance policies...?

What if the deceased paid a single Life premium many years ago? How would you know?

Your recently nominated COLP will play a pivotal role in ensuring that firms and ABS’s throughout England and Wales have appropriate systems and controls in place to enable them to manage business risks.

A Landmark Financial Asset Search enables probate professionals (and their clients) to have greater confidence that lost and forgotten financial assets have been sought as well as known assets and are distributed in accordance with the latest will.

Gerard has a background in Financial Services having been a Senior Executive or Director of a number of the institutions who work with us and who value the service they provide in reuniting assets with their rightful owners. His understanding of the industry has enabled us to develop the FAS search facility to become a critical tool for probate professionals as they manage their probate case risks.