Evans: Voluntary guidance
Solicitors should advise clients in property transactions on the potential liability they face from “climate risks”, the Law Society has said.
They should also explain to clients that one way to find out about climate risks was to commission a climate risk search and they should record the client’s decision on this.
The society said the practice note on climate change and property transactions launched this week built on the climate change guidance it issued in 2023.
This said climate-related issues may be “valid considerations” for law firms in deciding whether to act for potential clients.
In the latest guidance, the society said conveyancers should, subject to client instructions, “advise on the legal implications of potential liability or legal risks” from climate change arising from physical risks, such as flooding, or transition risks, relating to the UK’s transition to net zero by 2050.
Solicitors to adopt a “proportionate approach” to the issue and commissioning a climate risk search was “one way to find out more information about how climate risks may impact the property”.
They provided a “relatively easy way for busy solicitors and their clients to understand these risks at a basic level” but might not be suitable for all clients and properties.
Solicitors should explain that they were “not qualified” to advise on the technical, practical and financial consequences which flowed from the search results.
If a climate risk search obtained for a buyer raised concerns and the solicitor was also acting for their lender, they should seek instructions from the lender on whether they wished to proceed.
Solicitors should set out the scope of the advice and services they were providing on the legal implications of climate risks in a letter or terms of engagement at the start of the transaction.
“Alternatively, you can set out the scope of advice and services in the report on title. The advantage of including this in the report on title is that the advice will reflect the issues that have been identified as the transaction has progressed.”
The society said it was important that solicitors “reiterate to the client” that they were not qualified to advise on the physical risks of climate change and clients should seek advice from qualified professionals such as building surveyors.
A Law Society spokesperson said the practice note was developed in response to a call from members for greater clarity on how climate risk affected their conveyancing practices, together with guidance on how to advise clients.
It followed an “extensive consultation process” which began in September last year and included roundtables and discussions with conveyancers, industry bodies, local law societies and conveyancing associations.
“Our consultation results showed that most respondents felt unable to confidently discuss climate risks with their clients and would be interested in more training or resources.”
Mark Evans, vice-president of the Law Society, added: “We have ensured that the new practice note is positioned as voluntary guidance that seeks to assist the profession in dealing with a new challenge on which they had little clarity in how to deal with.
“The new practice note includes practical guidance to support solicitors to navigate this important and complex topic.”
Mr Evans said this included draft wording for a report on title that limited the liability of solicitors.
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