Leading environmental QC issues climate change advice
Conveyancers owe a duty to clients to provide information and warning on climate change risks which may adversely affect the property being purchased.
That message is part of the latest legal climate risk advice that environmental analytics business Groundsure has received from Stephen Tromans QC, who is widely recognised among the leading practitioners of environmental law in the UK.
Tromans emphasised that the attitude of lenders to climate change risks is critical. He said conveyancers acting for lenders owe a duty to pass on to them information which may affect their security. He stated that if the lender requires an assessment of climate change risk in the letter of instruction, this is a contractual responsibility for conveyancers.
Tromans pointed out that a conveyancer’s duty depends on the nature and sophistication of the client, and that it will be higher for residential clients than experienced commercial clients. Given that climate risks are much more likely to be apparent to a conveyancer than to a borrower, Tromans said a conveyancer should be aware of these risks and should, as part of their retainer, take steps to warn their clients and advise on steps to respond to the risk.
Read more: Groundsure launches new module to evaluate climate change risks to a property.
He warned that failure by the conveyancer to follow these practices may result in damages claims for professional negligence, increased insurance premiums, and possible reputational damage.
The barrister also argued that while conveyancers can exclude climate risk from the retainer, this would be a very unattractive course to take given the client’s fully informed consent would be required. This, he added, would also necessitate a full and clear explanation of climate risk, including physical damage, possible future risks on insurance, acceptability of the property as lending security, and effects on market value.
Tromans’ guidance suggested that the emergence of search tools — such as Groundsure’s ClimateIndex — mean there is a clear practical step which conveyancers can take to advise their client regarding climate risks.
“This important intervention marks a watershed moment in ensuring clients are protected through their legal advisors on the potential forward impact of climate change on the property transaction,” Dan Montagnani (pictured), chief executive at Groundsure remarked.
“It’s time for lenders to update their conveyancing guidance. They need to request that their panel conveyancers follow this advice. There is no question in my mind that this impacts their TCF compliance.”
