Friday, 28 June 2013

The danger of double charges

PI insurers are still seeing a significant number of claims relating to mortgage redemption statements.

A leading insurer recently advised me of a case where the solicitor was completing the sale of his clients' property, on which he knew there were two charges. He had obtained statements on each charge, and on the day of completion he asked a junior colleague to phone the bank for a final figure. His colleague only saw one of the two statements on the file, and the solicitor had not warned her that there were two charges. When he was given the redemption figure, he did not check that the figure included both. He paid the bank the amount that his colleague had been told, and paid the balance to his client, you can guess the rest.

To avoid this type of problem you should use a system like COMPLETIONmonitor which can only be signed off by the lawyer. Alternatively, mark the file clearly to show what charges are on a property, together with account numbers. Where possible, get redemption figures in writing from the lender, and always check that all charges have been included. More importantly, do not delegate crucial tasks to a colleague without giving a full explanation of what is needed and without allowing time to check that they have understood your instructions.

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