OPTIONAL CLAUSES
(for use with Offer to Sell (Vacant Possession)
and Offer to Sell (Investment Property))
Guidance Notes
The PSG has prepared a selection of optional clauses which are not necessarily appropriate in all
offers to sell, but which may be required from time to time, depending on the circumstances and type
of property.
We also suggest the appropriate place to insert each clause, if used, into the Offer to Sell (Vacant
Possession) and the Offer to Sell (Investment Property).
1 Deposit
The taking of a deposit at the conclusion of Missives is not particularly common in Scotland,
but there may be occasions when it is appropriate. An additional definition of "Deposit" will
need to be added to the Definitions Clause in the Offer.
The Clause provides for payment of a deposit and how such a deposit, and any interest
accrued on it, is to be treated by the parties.
2 Guarantee of Purchaser's Obligations
There may be occasions when it is considered appropriate by the Seller to take a guarantee
(for example, from a parent company) in respect of the Purchaser's obligations under the
Missives – principally payment of the Price. This clause provides a fairly simple form of
Guarantee, suitable for the usually relatively short period between conclusion of missives and
completion.
An additional definition of "Guarantor" will need to be added to the Definitions Clause in the
Offer.
You should also include a reference to this Clause in the supersession clause, and include a
reference to "Guarantor" in the Interpretation Clause 1.2.10.
3 Rights and Servitudes
Where the Seller is selling only a part of property that it owns, there will often be a
requirement to impose burdens on either or both of the part being sold and the part being
retained, and it is common for new servitudes to be required, also affecting either or both
properties.
This optional clause provides a template for setting out the various rights, burdens and
servitudes that may be necessary for both or either of the properties depending on the
circumstances, and which will in due course be incorporated into the Disposition (or other
document constituting real burdens and/or servitudes).
4 Service Contracts
The Property being sold may benefit from service contracts (e.g. in respect of lifts and
associated machinery), which it would be appropriate to pass on to the Purchaser. This
Clause makes provision in relation to the Service Contracts and their assignation to the
Purchaser.
Version 1
October 2008
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Additional definitions of "Service Contract(s)" and "Assignation of Service Contracts" will need
to be added to the Definitions Clause in the Offer to Sell – Vacant Possession, and a style of
Assignation of Service Contracts added to the Offer to Sell – Vacant Possession as a new
part of the Schedule. You should also include a reference to this Clause in the Supersession
Clause (Clause 19 of the Offer to Sell – Vacant Possession).
The Offer to Sell – Investment Property already incorporates appropriate wording in Clause
18 and Parts 14 and 15 of the Schedule dealing with the treatment of the existing service,
maintenance and/or management contracts.
5 Construction
For new or recently constructed buildings, the due diligence package should include relevant
construction documentation. Where that is the case, the approach which the PSG has
adopted is for matters relating to all of the construction documents, warranties, contracts
guarantees etc to be dealt with in the first instance within the Due Diligence Questionnaire. To
that end, Question 11 and Annexe 5 of the Due Diligence Questionnaire cover all the usual
due diligence observations and requisitions that would be raised in such circumstances for
review by the construction specialists acting for the Purchaser.
This optional clause provides for delivery of collateral warranties in relation to building
contracts and consultants' appointments, along with certified copies of the building contract(s)
and appointments, or assignations of collateral warranties if appropriate. As to the timing of
delivery of these documents, the Seller will usually need one month to procure fresh
warranties; if fresh warranties are to be provided and there is less than one month between
conclusion of missives and completion, an appropriate timescale post-completion should be
specified.
Depending on the nature of the works to which this clause relates, these can either be
specified in an additional part of the Schedule to the principal Offer, or the general reference
to all works carried out within the past ten years specified instead.
Where there are multiple contractors and consultants they should be listed, either in this
clause or in an additional part of the Schedule to the principal Offer.
The Seller is expected to provide a warranty that it has no other contractual rights in relation
to the design and construction of the Property that are capable of transfer. Depending on the
outcome of the Purchaser's due diligence examination of the documentation provided,
additional warranties or other comfort may be sought and should be added to this clause.
The construction documents should be included in the Disclosed Documents listed in Part 1
of the Schedule.
6 Family law and occupancy rights
In circumstances where there is a residential element in the Property (for example, a
caretaker's flat), then the relevant assurances or documentation require to be provided in
terms of Matrimonial Homes (Scotland) Act 1981; Family Law (Scotland) Act 1985 and Civil
Partnership Act 2004. This optional clause provides standard wording to be used in such
circumstances.
7 Company searches clause where the Property is still in the Register of Sasines
Where the Property being sold is still recorded in the Register of Sasines so that the
transaction will induce a first registration, it would be appropriate for the Purchaser's due
diligence to include a check against any other corporate owners of the Property during the
prescriptive period.
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This optional clause provides that the Seller will produce searches against other corporate
owners of the Property during the prescriptive period in appropriate terms.