The Court of Appeal has decided that solicitors acting for sellers of property should share responsibility with solicitors acting for buyers in cases where clients lose money because of fraudulent ‘sellers’.


In both cases decided by the Court recently, a scam artist had pretended to be the owner of a high value London property.  Each fraudster found a genuine buyer and instructed solicitors.   Everything appeared normal – except that the sellers were not the genuine owners.  The transactions went ahead and, because of the value of the properties, the unsuspecting buyers lost more than a million pounds each.


The sellers’ solicitors in each case had failed to properly check the identity of their client and that they were actually the owners of the property.  However, initially, the High Court held that the buyers’ solicitor should pay compensation to the buyers even though they did everything solicitors would normally do to make sure that the sellers were the genuine owners.   The Court of Appeal has now partially overturned that decision and ordered that the seller’s solicitor should also pay compensation to the buyer.


There still remains a great deal of uncertainty about who will be responsible for verifying a sellers identity and making sure the seller is the genuine owner of the property.  You should therefore expect any good solicitor to ask you lots of questions, whether you are buying or selling, to make sure that everyone in the transaction is genuine and using traceable money.


Nalders Solicitors have systems in place to prevent property fraud. There are however some simple steps you can take to prevent yourself becoming a victim:


  1. Always double check solicitor’s bank account details over the telephone before sending funds. Do NOT rely on emailed copies of bank details.
  2. If you are buying a property that is empty or has a tenant in it, tell your solicitor – they will want to ask further questions of the seller’s solicitors to make sure that the seller is the owner of the property.
  3. Set up property alerts with the Land Registry.   Property Alert is an award winning free property monitoring service aimed at anyone who feels a registered property could be at risk from fraud.  Once you have signed up to the service, you will receive email alerts when certain activity occurs on your monitored properties, allowing you to take action if necessary.
  4. If you don’t live at your property consider asking the Land Registry to put a restriction on the title which will require a solicitor to provide further certificates confirming they have verified your identity before the property is sold.


If you are buying or selling and want to use a solicitor who takes their obligations to keep your money or your property safe, then give Nalders a call at any of our 8 offices across the county.

Truro | Farley House

Tel: 01872 241414, Fax: (01872) 242424

St Austell

Tel: 01726 879333, Fax: (01726) 67401
Tel: 01326 313441, Fax: (01326) 315971
Tel: 01637 871414, Fax: (01637) 879414

Truro | Lemon Street

Tel: 01872 241414, Fax: (01872) 271019
Tel: 01209 714278, Fax: (01209) 710437
Tel: 01326 574001, Fax: (01326) 564547
Tel: 01736 364014, Fax: (01736) 364054

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