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Wrong to RTB

By J

I see that the Master of the Rolls has just issued a practice direction in respect of (what appears to be) many tens (if not hundreds?) of negligence claims arising out of RTB sales (see here).

Reading between the lines, a firm called Tandem Law (see here) appear to have brought lots of claims for negligence against solicitors who acted in RTB claims. It looks like there is said to be something dodgy about how mortgages were arranged. Now the cases are all being pulled together for Sales J to try and deal with.

Does anyone know anything more about this? It sounds like quite a big deal…

J is a barrister. He considers housing law to be the single greatest kind of law known to humankind and finds it very odd that so few people share this view.


  1. Martin Madden

    Speaking as someone who worked (and works) in Right to Buy at the time that most of these cases will probably come from, there has always been a risk that this would happen – mortgage companies were often tied to solicitors in the case of certain “non-high street” lenders.

    One has to pity Sales J who now appears to have the uneviable task of sorting out the resulting mess…

  2. J

    I’m still confused though – without giving any specifics of individual cases (or otherwise defaming anyone) – what is being alleged? That lenders and solicitors had some improper relationship? But what is the cause of action? What is the loss?

    • Martin Madden

      I suppose my best guess at the moment would be something along the lines that the claimants (presumably Right to Buy purchasers) are claiming that their mortgage provider tied them to an unsuitable legal representative as part of the process – how that leads to any quantifiable loss is beyond me.

      What did happen (quite a lot before 2008) was that an certain LA housing estate would be “canvassed” by certain “non-high street” lenders and a batch of RTB1s submitted (25-50 sometimes more in big cities).
      These applications would basically proceed on the basis that the lender would provide the mortgage and would also introduce you to the solicitor (almost always not based anywhere near you), who would provide your legal representation.

      Maybe that’s the argument – that there was some of of “improper relationship” between lender and solicitor which disadvantaged their mutual client?

      [I’ve tried to keep this comment to your requirements, but if it needs editing/deleting in any way, please do so.]

      • Giles Peaker

        That seems to be a part of it. Although I share your mystification as to quantifiable loss.

  3. stewie

    This is what tandem law are claiming

    “At the start of the buying process, a marketing company or a broker would visit the tenant and offer to arrange a mortgage, including the introduction to a lender and a firm of conveyancing solicitors; for this service, and for “managing” the tenant’s right to buy, the marketing company or broker would typically charge a fee of between £2,000 and £3,000.

    There may have been other unethical ‘add-ons’ in the form of Title insurance, life and critical illness insurance, PPI and solicitors’ costs. These extra costs are at the heart of the Right to Buy litigation because they were outside the approved purpose as provided under the Housing Act 1985.

    The marketing company or broker would often add these charges onto the mortgage amount and deduct them from the mortgage monies advanced when the tenant was unable to fund these extra costs from their own pocket. The effect of borrowing to cover these extra costs was that the costs were subject to interest charges for the length of the term of the mortgage…………..”

    • Giles Peaker

      Yes, I saw that. Just deeply unclear how that adds up to a professional negligence claim against the conveyancing solicitors, which appears to be what is going on.

  4. Martin Madden

    Reading Tandem’s comments they appear to have cast the net somewhat wider than just the conveyancing solicitors.

    “….inappropriate advice on their ‘Right to Buy’ mortgage. We have a team of experienced legal professionals who assist clients in bringing claims against brokers, solicitors or lenders.”

    So is the argument that by all being tied together there was some sort of mega negligence claim because the solicitors were necessarily possibly not acting in the best interests of the purchaser?

    if that’s all wrong, I can only say in my defence that I’ve got no legal training and am purely surmising from my professional experience of how Right to Buy works.


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