Standard Terms of Business

As soon as the Person Giving Security (PGS) transfers the Security Sum to our client account the contract is formed and we will only release funds in accordance with our Standard Terms of Business. By transferring money to us the PGS agrees to be bound by our Standard Terms of Business below.

Standard Terms of Business

Definitions Party Wall etc. Act 1996 Licence Building Contract Bond Court Order Rent Deposit
Regulations The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017
The Company Security for Expenses Limited registered at Companies House, Cardiff (company number 10113125)
Customers Any person or entity using our Service or named in a Transaction Schedule including but not restricted to the PGS, parties, surveyors, Contract Administrator and Adjoining Owners.
The Act Party Wall etc. Act 1996
PWA Party Wall etc. Act 1996
Owner A “building owner” or “adjoining owner” as defined in Section 20 of the Act. The person or entity granting the Licence (usually referred to as the “owner of neighbouring land”)
Adjoining Occupier An occupier of adjoining property as defined in Section 20 of the Act
Licensee The person or entity to whom the Licence is granted
Contractor The person or entity named as the Contractor in the Building Contract
Employer The person or entity named as the Employer in the Building Contract
Contract Administrator (CA) The person named in the building contract with authority to direct payment from the Security Sum to the Contractor or Sub-Contractor
Parties The building owner(s) and the adjoining owner(s) under the Act The parties named in the Licence The Employer and the Contractor or Sub-Contractor The parties named in the Bond The parties named in the Order The parties named in the Lease
Surveyors The surveyor(s) appointed or selected in accordance with Section 10 of the Act The surveyors or other persons or entities named in the Licence.
Person Giving Security (PGS) The owner, person or entity providing the money to be held by the Company as Security
Licence The Licence agreed by the Parties as submitted to the Company
Building Contract The form of contract for building works entered into by the Employer with the Contractor or by a Contractor with a Sub-Contractor
Security Sum The sum deposited with us as Security for Expenses under the Act The sum deposited with us as Security The sum deposited with us as Security under the Building Contract The sum deposited with us as Security
Security Agreement The conditions agreed between the parties or awarded by the surveyors under which Security for Expenses is to be released The conditions under which the Security Sum is to be released which may be set out in the Licence The conditions under which the Security Sum is to be released as set out in the Building Contract The conditions under which the Security Sum is to be released as set out in the Bond The conditions under which the Security Sum is to be released as set out in the Order The conditions under which the Security Sum is to be released as set out in the Lease
Transaction The deposit of the Security Sum with the Company and the disbursement by the Company of the Security Sum as and when directed
Risk-free Transaction (RFT) A Transaction in which the Security Sum is returned in full to the originating account
The Service The service offered by the Company by which it holds money “in escrow” on behalf of the Parties and releases it in accordance with the Release Mechanism
Transaction Schedule The schedule prepared by the Company setting out details of the Transaction including the PGS, parties, surveyors, CA, Security Sum and any variations to the Company’s Standard Terms of Business
CDD Customer due diligence in accordance with The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017
Release Mechanism Receipt by the Company of the Company’s release form signed by the parties, any two of the surveyors, the third surveyor alone or an order of the Court. Receipt by the Company of the Company’s release form signed by the parties or their surveyors or an order of the Court. Receipt by the Company of a Certificate for Payment issued by the CA under the Building Contract. As defined in the Variations on the Transaction Schedule form part of the Company’s offer.
Terms of Business The standard Terms under which the Company provides the Service and which form the basis of the contract between the Company and the PGS and which are posted on the Company’s website.
Agreement The contract between the Company and the PGS for the provision of the Service effected by the PGS transferring funds to the Company’s client account and paying the setting up fee.
HMLR Her Majesty’s Land Registry

In using the Service, Customers agree to the following Terms:

  1. General
    1. The Company is not responsible for confirming the lawfulness of any appointments and selections of Surveyors or other consultants involved in the transaction process. In using the Service, Customers confirm their acceptance that all such appointments are valid and if made under the Act cannot be rescinded.
    2. A Security Agreement will usually include conditions that must be met before the Security Sum can be released. Any such conditions are outside the control of the Company and are a matter between the Parties and/or the Surveyors.
    3. Where the PGS is a “consumer” meaning any individual acting for purposes which are outside any business he may carry on, the Service comes under The Financial Services (Distance Marketing) Regulations 2004. In such cases the right to cancel under Regulation 9 will apply and Security for Expenses will only be effective 14 days after the Security Sum and fees have been received, accepted and fully processed by the Company.
    4. All Security Agreements must be in English.
    5. The Security Sum will be held in one of the Company’s segregated Client Accounts and will not be mixed with the Company’s own money.
    6. If Government authorities or similar bodies request that the Security Sum is withheld pending Money Laundering or Anti-Terrorism checks or make other requests of a comparable nature or if the Company suspects that these activities may be taking place the Company may delay payment until such checks are completed and the Company bears no liability for such delays.
    7. The Company will communicate with Customers by displaying information on its website and by email. The Company is not obliged to communicate using any other method of communication.
    8. English law applies to this contract.
    9. A person who is not a party to this Agreement has no rights under the Contracts (Rights of Third Parties) Act 1999 to rely upon or enforce any term of this Agreement.
    10. All interest accruing to Security Sum held in the Company’s segregated client accounts will be paid to UNICEF or such other charity that the shareholders shall decide and details published on the Company website. Any negative interest applied to the Security Sum by the bank holding the funds will be deducted from the Security Sum.
    11. If: (a) we reasonably suspect that the PGS has given us false information; or (b) we reasonably suspect that the account is being used for an illegal purpose; or (c) the PGS behaves in an unreasonably threatening or violent manner towards our staff, then we may withhold funds which are due to be returned to the PGS and take reasonable steps to comply with the law and for the protection of our staff. We may deduct reasonable expenses incurred in so doing from the amounts due to be returned to the PGS.
    12. The Parties will be responsible for all losses caused by any fraudulent activity on their part or that of any person acting with their authority.
    13. We will not be liable to the Parties for any breach of or failure to perform our obligations where that breach or failure is due to abnormal circumstances beyond our control, and despite our reasonable efforts to rectify the situation.
    14. In the event of failure of the banking system the Company will only be liable to the PGS for the amount recovered from the Company’s bank.
    15. If any part of these Terms & Conditions proves to be unenforceable it will not affect the validity of the remaining Terms & Conditions. Any relaxation by us of any of the Terms & Conditions from time to time does not affect our right to enforce the Terms & Conditions strictly at any time.
  2. Obligations of the Parties, Surveyors, Adjoining Occupiers and Contract Administrators
    1. The Parties, Surveyors, Adjoining Occupiers and Contract Administrators agree that the personal details they submit to the Company will be accurate and correct and will update these details to keep them accurate.
    2. It is the responsibility of the Parties or the Surveyors or the Contract Administrator to ensure that the conditions of the Security Agreement have been met and that the instructions for the release of the Security Sum are correct. The Company will act strictly in accordance with the instructions received.
    3. The bank account details that are registered with the Company must be the personal bank account details of the Customer and not those of any other third party.
    4. If the Security Sum is returned to the PGS by the Company in error or due to fraud the PGS agrees to return such sum to the Company on its request.
    5. We may record telephone calls with any Customer to ensure that we provide a good service and that we follow instructions correctly.
    6. Our records will be evidence of our dealings in connection with our Service. Customers agree not to object to the admission of our records as evidence in any legal proceedings on the grounds that such records are not originals, are not in writing or are documents produced by a computer.
  3. Fees
    1. Fees must be paid into the Company’s current account separately from the Security Sum before Security for Expenses will be confirmed as being effective or any payments will be made out of the Security Sum.
    2. Any outstanding fees due to the Company may be deducted from any sum directed to be returned to the PGS.
    3. The Company will not make any deductions in respect of fees from money directed to be paid to any Third Party except in cases where that Third Party is the result of a change of name or bank account of the PGS.
  4. Payment
    1. The Company may reject funds paid into its client account if those funds are not paid from the bank account registered with the Company or if not paid with the correct reference as instructed by the Company or if not for the exact amount instructed. A fee will be deducted from any returned funds.
    2. Payments into the Company’s client account must be made from a United Kingdom bank account.
    3. Payments from the Company’s client account will only be made into United Kingdom bank accounts.
    4. By using the Service, the Parties confirm that an Award made under the PWA directing the release of the Security Sum is an instruction to the Company that will be executed fourteen days after the date the Award is received by the Company unless either Party gives notice to the Company that an appeal to the County Court has been made under Section 10(17) and provides a copy of the Notice of Appeal.
    5. We aim to make payment by instructing our bank to transfer funds within three working days of completion of our procedures.
    6. When we are directed to release the Security Sum in full to the originating account this will usually be done without further formalities.
    7. When we are directed to release funds or make a payment to a third party we will make an initial transfer of £10.00. On confirmation of safe receipt we will transfer the balance.
    8. When we are directed to release the Security Sum to any Third Party we need to undertake customer due diligence (CDD) as required by The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017. The Company is not responsible or liable for any delay caused by the due diligence process.
    9. When we are directed to release the Security Sum to any Third Party a further fee is payable. CDD may be carried out pending receipt of the additional fee at the discretion of the Company.
    10. The Parties may agree or the Surveyors may determine that an Adjoining Owner shall be cleared in advance to receive funds in which case we will carry out CDD on receipt of the appropriate fee.
    11. The Company will only release the Security Sum in accordance with the Release Mechanism as defined in the schedule of definitions. unless varied in the Transaction Schedule. The Security Sum will only be paid into bank accounts validated by the Company and not into any other account.
    12. Receipt of funds by the Company will be treated as occurring when funds are irrevocably cleared in our account and our fee has been paid.
    13. We use a secure online service for signing security release forms. Depending on who is to authorise release, either the parties or the surveyors will receive an email from us via Signable with a link to a secure site where the release form can be signed.
    14. It takes longer to confirm the source of funds when payment is made by BACS, CHAPS or other intermediary banking services. When payment is made by such means the PGS must provide a Confirmation Statement from their bank confirming details of the payment.
    15. Once payment of the Security Sum is made to the Company it will only be released by the appropriate Release Mechanism.
    16. The Company may delay or refuse release of the Security Sum if: (a) we reasonably suspect fraudulent activity may be involved; or (b) instructions are unclear, incomplete or not in the required form; or (c) to do so might be contrary to a law, regulation, code or other duty which applies to us; or (d) we have any other valid reason for not acting on received instructions. If we refuse to make a payment we will notify you by email or any other suitable form of communication and, if possible, give our reasons for doing so.
    17. The Company will not be liable for any loss suffered in respect of a payment that has not been authorised or which has been incorrectly paid unless we are notified without undue delay and not later than 3 months after the date of the payment. This Condition will not apply if we have failed to provide information about the payment.
    18. In the event of the PGS becoming insolvent or struck off the register at Companies House the Security Sum will be released as and when directed in accordance with the Release Mechanism to the legally appointed receiver or administrator and the Company’s Third Party CDD fee will be deducted from the balance to be returned.
  5. Information
    1. The Company will hold information on its Customers in accordance with UK Data Protection law for the legitimate purpose of providing the Service.
    2. Any personal information provided to us will be used to discharge our obligations under the Payment Services Regulations 2017, The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 and other relevant legislation and may be disclosed to third parties for those purposes.
    3. Information comprises all the details we hold about any Customer and may include information obtained from third parties. We may use and share information to help us: (a) assess financial risks, (b) recover debt, (c) prevent and detect crime, (d) understand our customers’ requirements, (e) develop and test products and services.
    4. We do not disclose information to anyone except: (a) where we have permission; or (b) where we are required or permitted to do so by law; or (c) to fraud prevention agencies and other companies that provide a service to us; or (d) where we may transfer rights and obligations under this agreement.
    5. As required by HMRC, information will not be erased for six years from the date that the Transaction account is closed. Until that time a Customer has no right to erasure of data held.
  6. Prevention of Fraud, Money Laundering, Terrorist Financing, etc.
    1. As a registered Money Service Business, we are required to carry out certain checks as part of crime prevention measures. We may contact Customers by post, telephone (including mobile phone), email or we may leave a message asking them to call us. We may ask them to contact us or to pay a token amount to us by bank transfer from their registered bank account to confirm their identity. If they do not respond to us in a timely manner, we may (a) assume that the Transaction has not been authorised in which case it will not proceed or (b) proceed with the instruction based on the directions received.
    2. We may take whatever action we consider appropriate to meet any obligations relating to the prevention of crime, money laundering and terrorist activity and the provision of financial and other services to persons who may be subject to sanctions. This may include, but is not limited to, investigating and intercepting payments into and out of the Company and investigating the source of or intended recipient of funds. It may also include making enquiries to establish whether a person is subject to sanctions or is politically exposed. Exceptionally, this may delay the execution of directions or the receipt of cleared funds but, where possible, we will indicate the reasons for and likely length of any delay. If we are not satisfied that a payment in or out of the Company is lawful, we may refuse to deal with it.
    3. We shall not be responsible for any loss or delay incurred as a result of us taking the actions set out in this section.
  7. Complaints
    1. If we do not deliver the standard of service you expect, or if you think we have made a mistake, please let us know by emailing [email protected]. Our complaints handling procedure complies with Regulation 101 of the Payment Services Regulations 2017.
    2. We will investigate the situation and try to put matters right without delay. Where appropriate we will also take steps to prevent a recurrence. You may also be able to refer your complaint to the Financial Ombudsman Service at South Quay Plaza, 183 Marsh Wall, London E14 9SR.
  8. Disputes Between Parties
    1. The dispute process detailed in this section does not relate to a dispute between a PGS and the Company. A dispute between a PGS and the Company will be dealt under the complaints procedure above.
    2. The PWA requires that in the event of a dispute between the Parties over the release of the Security Sum then the dispute resolution process set out in Section 10 of the Act shall be engaged and the Company will not be under any obligation to release any part of the Security Sum until properly directed by the Surveyors or the Court.
    3. Disputes between Parties are not under the control of the Company. In using our Service, Customers understand and accept that the Company is duty bound to follow the payment instructions of the Surveyors if a dispute has arisen between the Parties.
    4. The Company is not responsible for the actions, decision, conduct or payment of the PGS, the Parties, Surveyors, Contract Administrator or any other person not employed or authorised by the Company.

30 December 2020

 

Revisions
2019-07-02 Clause 4.9 amended
2020-12-30
Clauses 1.1, 1.3, 1.10, 1.15, 3.1, 3.3, 4.4, 4.8, 4.9, 4.11, 4.17, 5.1, 5.3, 8.1 and 8.2 amended

Clauses 4.13 and 4.18 replaced