Broker Guide to Missives

Broker Guide to Missives


When a buyer is submitting an application to purchase a property in England they will go through the usual processes of exchanging contracts; in Scotland the first stage in the conveyance of a property is called ‘missives’.

A missive is a document in letter form exchanged between the seller and purchaser of a property, usually written by their respective solicitors as agents. Missives are made up of a formal offer, qualified acceptance and other letters which are exchanged leading to the contract for sale.

Concluded missives are then agreed with a fixed date of entry which both parties are expected to work towards. Once the missives are concluded, paperwork for the legal transfer of the property is completed and the purchaser has a contractual, i.e. personal right to demand that the seller perform his/her obligation to convey the property.

Missives start with the submission of an offer on behalf of the purchaser for the property. This is followed by a qualified acceptance as the seller will normally wish to amend some of the conditions in the offer or include conditions of their own. This is effectively a counter-offer and it is up to the purchaser to accept or reject the amendments/conditions or to walk away from the transaction. Such letters will continue to be exchanged until such time as the purchaser and seller finally reach agreement. Once the contract is concluded there is in place a legally binding and enforceable contract. If the purchaser fails to implement the agreed terms they will be liable for substantial damages, so no offer should be submitted until both parties are willing to be legally bound and satisfied that the relevant finances are in place for the purchase.

Kyle Peddie, Chief Executive of Your Conveyancer, explains more about the process to B&C…

An offer for heritable property in Scotland must be in writing; there is no binding or enforceable contract until an offer, or a qualified acceptance of an offer, is met with by a straight acceptance in writing.

The offer, any qualified acceptances and the final acceptance is together called “the missives”. When the final agreement is reached the missives are said to be concluded and there then exists a legally binding contract. Until this point both the seller and the purchaser can withdraw from negotiations without warning, reason or penalty. When missives are concluded, either party can sue the other in the event of a breach or failure to carry out his or her part of the bargain.

One of the greatest advantages of the Scottish system in the past was the speed with which missives were concluded, which gave both the purchaser and the seller certainty at an early stage, including a specific completion date. Up to the 1970s, missives comprised around five clauses. However, cases and other developments in the law made the process more complicated. Offers expanded greatly in size and complexity which slowed the process. It was rarely possible or wise to give an unconditional acceptance of an offer resulting in solicitors and their clients having to go through the painful process of offer and numerous qualified acceptances before missives were concluded.

As a result of this, in an effort to speed up the process, most of the regional solicitor bodies in Scotland have now introduced a standard style of missives for their region which reflect the position that most solicitors in their region, and probably further afield, would accept. The aim is to conclude the missives with either a straight acceptance of the offer or not more than one qualified acceptance before a final acceptance is agreed within one week.

However, it has to be recognised that if an offer is submitted in the standard style it is now quite conceivable that the purchaser’s solicitor could receive a straight acceptance, thereby concluding the contract. Accordingly, purchasing clients will have to be completely ‘upfront’ with the seller, stating whether their offer is subject to survey, a loan or conclusion of missives for the sale of their own property. Complete frankness is required as a purchaser may find himself bound to a contract thinking the old method would allow him more time. From a seller’s point of view there will be now greater transparency regarding the purchaser’s position.

In Scotland, missives are concluded at an early stage conditional upon several matters such as survey, satisfactory title, clear searches and loan. The purchaser and seller can only withdraw from the contract in the event that any of these conditions are not satisfactorily resolved. This gives both parties certainty at an early stage enabling them, for example, to arrange bridging facilities earlier. In contrast, the position in England and Wales is that contracts are not exchanged until all of these matters have been satisfactorily resolved, resulting in uncertainty regarding a completion date and in either party being in a position to withdraw without penalty, literally until the last minute. This results in long chains of contracts that haven’t been exchanged and the issue of ‘gazumping’ and more recently ‘gazundering’ and of course a complete lack of certainty for both parties.

Standard missives assist a more straightforward conclusion of missives with few of the inherent delays that were involved under the old system. Speed and ease of conclusion of missives and clauses with which both the solicitor and the client can become familiar are enormous benefits. These standard missives are the tool to make this a reality.

Leave a comment