A DocuSign from Heaven

We’ve received great feedback from our clients and key contacts since introducing DocuSign to our processes back in May. 
Some of you will have seen prior updates touting our use of this wonderful tool, bragging of our innovation and market-leading approach. With hindsight we should have taken a more typical lawyer approach and caveated our comments: describing DocuSign as innovative is a bit like Homer Simpson telling Marge the internet is on computers now. 
Speed and efficiency 
Ok, so DocuSign is not that innovative. We maintain, however, that in the legal world it is. While this may be a somewhat sad indictment of the legal industry’s sluggishness to embrace change, we celebrate the step forward. Most importantly (and for those of you already in the 21st Century, unsurprisingly) we have already seen great improvements to the efficiency and speed of transactions for our clients. 
At present we use DocuSign for contract exchanges and anticipate the ability for clients to execute completion documents (technical term: Deeds (which carry a different legal status) electronically very soon. Any new clients exchanging off plan now should be able to execute their completion Deeds electronically by the time of completion. 
Although in operation since 2020, now seems an appropriate opportunity to celebrate by way of official announcement other ways technology is making the legal process less cumbersome: certification of Identity documents by video call and via client’s mobile apps are now permanent features of our processes. 

certification of Identity documents by video call and via client’s mobile apps are now permanent features of our processes.  

Why so long?

We were recently asked when promoting our use of DocuSign, why the legal industry can be so reluctant to embrace change? For those interested: we believe it’s because our industry is centuries old, incredibly risk-averse and an extremely mature market where no player wants to be the first to move. In any event, PCB is now catching up with the wider business world and we hope you will welcome us to the 21st Century. 

Return to Hong Kong

It’s been 3 years since my last visit to Hong Kong. Even now typing those words, and despite having lost count of the number of times I’ve said them in the last few weeks, I still find them hard to believe.

Those of you who know us well will recall the frequency of our visits to this revered city before the pandemic grounded the whole world. Many of you will have accompanied us on our travels or hosted us there.

Visiting after such a long time is a stark reminder not just of how much Hong Kong has changed, but also the world. In the spirit of positivity, I won’t dwell on the RATs and masked faces Hong Kong is still contending with. What I will say is that my visit over the last 8 days felt like a real turning point.

It was an encouraging and well-timed trip. The buzz there was reminiscent of my Singapore trip back in April and May- that “things are finally heading in the right direction” sense of optimism we’ve all experienced at one place and time or another.

UK property was out in full force, especially London, and congratulations to London Square for the grand opening of their office in Exchange Square. A bold move and a signal of strength for the whole industry.

Special thanks must go to Mount Anvil, Asia Bankers Club, Regal Homes and Samuel Chan for involving us in their launches this past weekend; both posting decent results going into the weekend despite prevailing headwinds . I feel proud to be part of an industry where the UK continues to shine (in stark contrast to our counterparts in Westminster).

My personal highlight has to be meeting our team (pictured) on the ground in Hong Kong for the first time. Most of us are now used to the notion of working closely but remotely with colleagues without ever actually meeting them. It’s a surreal but triumphant moment when you eventually do.

Further details on the growing team and our association with local firm Henry Yu and Associates to follow.

It felt great to be back.

Mortgage Correction – a Call for Calm

Not for the first time, there are plenty of inaccuracies and misinformation circulating in the Press, this time regarding mortgage products, which we feel it’s important and hopefully helpful to address.

A clear distinction must be made between the term ‘mortgage offer’ and ‘mortgage product’ in order to understand what has happened in the mortgage market this week and avoid unnecessary panic.
Mortgage Product:
Mortgage loans marketed by lenders on a variety of terms, which potential borrowers are encouraged to apply for, and for which they will need to establish some level of eligibility either directly with the lender or often through a mortgage broker.

Mortgage Offer:
Confirmation of acceptance of a borrower to use and rely upon a particular Mortgage Product in order to fund a particular property purchase, once the application process has been completed and thorough eligibility checks are undertaken and approved.
What we’ve seen this week is disruption in the Mortgage Products available for potential borrowers to apply for. As far as we are aware lenders are not withdrawing Mortgage Offers which have already been issued and which Borrowers are looking to rely upon for imminent purchases.

Mortgage Products change all the time and it is not surprising to see a lot of change when interest rates are moving.

In the context of this unsurprising disruption, a lot of media outlets are incorrectly (and irresponsibly) referring to Mortgage Offers being pulled on mass. This is unnecessarily spooking borrowers who have already found a property, been approved for mortgages, and are hopeful of concluding their purchase very soon.

Is it possible for lenders to withdraw Mortgage Offers?

Technically yes, but only in accordance with the terms of the offer, which usually refer to a change of circumstances of the borrower or a problem with the property in question. Borrowers with Mortgage Offers are encouraged to check their Mortgage Offers and consult with their mortgage broker and/or solicitor for clarity.

(Please note an Offer in Principle is not a final Mortgage Offer – this is usually available at a much earlier stage and would not in any market conditions be relied upon to exchange contracts).

UK Stamp Duty News in a Nutshell

The UK’s recently appointed Chancellor, Kwasi Kwarteng, has this morning announced changes to the rates of Stamp Duty Land Tax payable in England and Northern Ireland. In a nutshell:

  • The nil rate band has increased to £250,000 (from £125,000);
  • The nil rate band for First Time Buyers has increased to £425,000 (from £300,000);
  • The property value on which First Time Buyer relief may be claimed has increased to £625,000 (from £500,000).

A straightforward increase on the existing tax-free framework which all purchasers will benefit from and first-time buyers in particular.

Whatever one’s political views or take on the property market, this will no doubt provide a boost to momentum and sentiment in the whirlwind of headwinds and tailwinds we have all experienced over the last few years. 

Based on previous changes to stamp duty rates, we expect this change also to apply to contracts that have already exchanged (buyers should check with their solicitor for confirmation). Hopefully good news for our existing clients, especially those who have exchanged off-plan.

Embarking on Birmingham

After the announcement of our new premises in Oxford Circus, last week saw PCB with very much a national focus. We always receive a friendly reception when we visit what are fast becoming two of our favourite cities: Birmingham and Manchester.

We’ll provide more details on Manchester- the mind-blowing transformation of Deansgate and the planned regeneration of an entire Valley (as well as an exciting launch in Liverpool)- in a later update. This week the spotlight is firmly on Birmingham, and we are delighted to welcome Yasmin Chohan to the firm, our primary contact on the ground there.

Yasmin has a wealth of experience as a Legal Executive, serving Birmingham and the surrounding regions for 8 years. Supporting Yasmin is Angela Lakha, a key player in our new build team who will be working from both London and Birmingham.

We have received overwhelming support from our network, both old and new, as we embark on establishing a permanent base in Birmingham. Special thanks go to Galliard Homes, One Global and St Joseph for their warm welcome. We look forward to enhancing the assistance we provide our existing client base there as well as forming new relations.

In other news, the response to our more digital approach has been unanimously well received and we’ll be providing more details on those in our next update.

Welcome to Wigmore Street

Since our celebrated merger with Benson Mazure last Spring, and further boosted by strong organic growth, we’ve been bulging at the seams in Baker Street and are proud to announce the opening of PCB’s new W1 London premises at Cavendish Court, 11-15 Wigmore Street.

Besides a sad farewell to Baker Street and Sherlock Holmes, change has been a plenty at PCB, much like the world at large. We’ve said farewell to Melvin Berwald, original founding Partner of the firm, and Judith Fishman, long-serving Managing Partner. We look forward to bearing tribute to their lasting legacies in the coming months.

Another Senior Partner who has been no stranger to change in his long career is Anthony Levy, previously Senior Managing Partner at Benson Mazure, and now tremendously valued consultant at PCB. Mr Levy’s is an incredible story we look forward to regaling you with.

PCB Expansion

Join us as we embark on Birmingham, a new focus for PCB, and build on our long-standing foundations in Hong Kong with two permanent hires and office space there.

The Mothership in London continues to grow too, with our newly built new-build team of next-gen lawyers including our latest trainee, Amy To.

Tech Innovation

We’re excited to announce we are now using DocuSign, dramatically reducing our client-side admin to the click of a mouse: an absolute game-changer. Further detail and more PCB innovations to follow.

On the Horizon

Over the next weeks and months, we plan to bring you up to speed on these changes, where PCB’s at and where we’re headed. It’s an exciting time for us as we progress on a journey of expansion and growth, with your legal needs at its centre.

So welcome to Wigmore Street, we hope to host you here soon and watch this space for further details on all of the above and more.

EXCLUSION CLAUSES- Be clear and unambiguous

The Court of Appeal have recently reached their decision  in Persimmon Homes v. Ove Arup Partners. In the High Court decision it was held that Ove Arup could rely on an exclusion clause they inserted in their appointment letter to avoid liability for asbestos. Persimmon Homes appealed arguing that the exclusion clause did not work to exclude liability for negligence. The wording of the exclusion clause was “liability for any claim in relation to asbestos is excluded”. The Court of Appeal upheld the High Court’s decision and said the exclusion clause was all embracing. Interestingly, the Court of Appeal also commented on the contra proferentum rule of construing documents. This rule says that if there is ambiguity in a document then it is construed against the seller or landlord (as the case may be). The Court of Appeal said that this rule would now very rarely be invoked – especially where the parties were of equal bargaining strength.

MIND THE (Registration) GAP

Stodday Land Limited and Ripway Properties v. W M Pye – this is a Court decision this month on the “registration gap” issue.  A buyer completed the purchase of a property, applied to the Land Registry to register the Transfer and then served a notice to quit on the tenant.  The Court held that the notice was invalid as the buyer was not yet registered at the Land Registry as the proprietor of the property.

This is therefore a further reminder as to how the law operates on this issue and reinforces the importance of applications being submitted to the Land Registry promptly after completion of a purchase.  The case also follows the 2001 Court of Appeal decision in Brown & Root v. Sun Alliance where an original tenant assigned the Lease to a group company.  There was a break clause in the Lease that was personal to the original tenant.  Some time after the assignment, it was decided that the tenant no longer wanted to continue with the Lease and the original tenant served the break notice.  The landlord argued that the notice was ineffective as the Lease had been assigned to the group company.  The Court held that the original tenant was entitled to serve the break notice since the assignment to the group company was never registered at the Land Registry.

If that particular decision was to be litigated again today, S.28 of the Landlord and Tenant (Covenants) Act 1995 may well assist the landlord.  The section states that an “assignment” includes an equitable assignment.  There are a few possible ways around this issue where a property is being purchased and it is known that notices may need to be served shortly after completion of that purchase.  When the contract is being negotiated, a clause could be inserted whereby the buyer acts as the seller’s agent in serving notices or otherwise the seller agrees to act in accordance with the reasonable requirements of the buyer (at the buyer’s cost) during the “registration gap”.

This information is published for general information and should not be relied upon without legal or other professional advice.

AST’s – make sure you create the perfect ending

It is now just over a year since the law changed as to how a landlord can validly end an Assured Shorthold Tenancy. A timely reminder then on this important topic. A S.21 Notice (Housing Act 1988) must be served on the tenant to end the tenancy where the tenant is not in breach of any of its obligations. If the tenant is in breach, a landlord has a choice of serving a notice under S.8 or S.21. For the purpose of this note, we are only focusing on S.21 notices. The end date specified in the S.21 notice will either be the expiry of the tenancy agreement or an earlier landlord’s break date. A minimum of two months’ notice must be given.

The important point to note is that for AST’s completed on or after 1 October 2015, a S.21 notice will not be valid unless the tenant has been given:

  • An energy performance certificate
  • A gas safety certificate
  • A “How to rent” booklet

To avoid future disputes, tenants should be issued with the above papers at the start of their tenancies.

Landlords routinely used to serve S.21 Notices at the outset of the tenancy – just in case they forgot to do this towards the end of the tenancy. It is now no longer possible to serve a S.21 notice within the first 4 months of the start of a tenancy – unless that tenancy started before 1 October 2015.

If you need to start possession proceedings if a tenant fails to vacate, landlords must now do this within 6 months of serving the S.21 notice otherwise the notice lapses.

There are other changes too – for example dealing with tenants who have made certain complaints – but the above requirements comprise most of the key changes introduced last year.

Landlords, or managing agents on their behalf, must ensure everything outlined in this note is done correctly otherwise they may find tenants can lawfully outstay their welcome.

This information is published for general information and should not be relied upon without legal or other professional advice.

IHT for Non-Doms (residential property)

We have not seen the economic downturn predicted immediately after the Brexit decision but the pound lost significant value following the referendum result on 24 June 2016. Whilst the currency markets have been predicting further reductions in value of sterling before it begins to stabilise, recently the pound has started to regain some value – perhaps because there was an overreaction or because the US dollar is reflecting its own weakness ahead of the upcoming American elections.

So far the UK has not triggered Article 50 to begin the negotiations to set our exit terms from the EU – so there must inevitably be a continuing period of uncertainty.

In the property market there are price reductions especially at the top end of the market, but there is also evidence at the lower and middle end that a lack of supply of homes is helping to maintain values.

As expected, the Government still intends to bring residential property held in an offshore structure by non doms within the scope of Inheritance tax. This will apply with effect from 6 April 2017 and the Government’s latest consultation paper published last month is available at:- https://www.gov.uk/government/consultations/reforms-to-the-taxation-of-non-domiciles-further-consultation/reforms-to-the-taxation-of-non-domiciles-further-consultation

It is worth noting that commercial property is not caught by these proposals. Similarly only residential property was targeted when Capital Gains Tax for non-residents became payable for the first in April 2015.

The stock market appears to be reasonably sound – anecdotally helped by the lower pound. Everyone should be back from their summer holidays now and it will be interesting to see if the value of sterling and softer prices help kick start the market.


This information is published for general information and should not be relied upon without legal or other professional advice.