This new legislation imposes a legal obligation on Vendors to discharge any water charges due on a property prior to the closing of a sale. Furthermore, it creates a new step in the conveyancing process which a Solicitor will now have a duty to fulfil.
Section 48(2)(a) of The Act requires the owner of a property, in the event of a sale, to pay to Irish Water any charges due under the Water Services (No. 2) Act, 2013 (if not already paid). This includes charges payable where an owner has failed to notify Irish Water of the occupier or tenant of a property as the liable person. Additionally, Section 48(2)(b) provides that the owner of a property, as a Vendor, must provide his/her Solicitor with a Certificate of Discharge from Irish Water confirming that there is no liability outstanding prior to them completing any sale. Alternatively, if a Vendor is not the liable person they can provide the Solicitor acting in the sale with a Statement from Irish Water to this effect confirming no liability.
The obligations arising under Section 48 will make it necessary for Solicitors acting in a sale to notify their Clients at the initial stage of instructions of the obligation they will have to Irish Water. If these obligations are not complied with, it will cause difficulty for the Solicitor who will have to withhold money from the proceeds of sale until payment is made. Section 48(3) of The Act states that in the event that the above Certificate or Statement is not provided before the completion of a sale then a Solicitor must request from their Client an account statement from Irish Water setting out the charges due on the property. If a Vendor refuses to provide this, then under Section 48(4) of The Act a Solicitor must request directly from Irish Water an account statement detailing the charges due in advance of completing any sale. The Solicitor then has an obligation under Section 48(5) of The Act to withhold from the net proceeds of sale sufficient funds to discharge the amount due to Irish Water under the account statement received. This payment must be made to Irish Water by a Solicitor within twenty days of completion of a sale. Irish Water must then provide a receipt for payment which shall be considered full and final settlement of any obligations imposed on a Vendor’s Solicitor.
The charges due to Irish Water under The Act are only payable after all mortgages and liabilities relating to the sale have been discharged. In the event that there are no net proceeds of sale then no payment is required to be made to Irish Water and a Solicitor must write to Irish Water within twenty working days notifying them of this. Irish Water should acknowledge this notification which again will be considered full and final settlement of any obligation placed on a Vendor’s Solicitor.
Irish Water have confirmed that they will aim to issue all Certificates, Statements, account statements and receipts required within five working days of any requests received provided all of the necessary information has been provided. In this regard the following should be submitted with all requests to Irish Water:
Requests can be made by phone, post or email directly to Irish Water however documents will only be issued from them by way of post for reasons relating to data protection.
It is important to note that the above obligations lie solely with a Vendor and their Solicitor and any liability due does not rest with or affect the property in sale. As such no liability will pass to a Purchaser or their Solicitor.
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