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Dentistry business: Checking every detail
9th Jan 2012
There is no denying that the process of buying and selling a dental practice involves a significant amount of paperwork and you should be wary of being caught out by the small things.
A specialist dental solicitor will guide you through the process, which will involve everything from checking associate agreements to reviewing X-ray test certificates and checking that the plans at the Land Registry accord with the practice you think you are buying.
A recent example involved a practice spread over two floors, with the upper floor including a room above a public passageway leading to a rear courtyard.
Unfortunately, the documents at the Land Registry missed off the room above the passageway. This meant that the selling dentist simply didn't have legal ownership of this room.
The dentist buying the practice understandably believed he was buying the room in question, which was being used by the practice as a surgery. However, technically speaking this was not part of the property being sold.
The situation was resolved using the rules of adverse possession (commonly known as squatters' rights) and assigning these rights to this room to the buyer.
This allowed the buyer to acquire a right to use this room and a right to register a title to that room at the Land Registry.
Any unknown rights of third parties against the room were insured against with a one off payment insurance policy.
However, the claim was further complicated due to the fact that there was a passageway running beneath the room which was used by members of the public.
Clearly, the selling dentist didn't own the passageway beneath the room but consideration had to be made as to what was and what was not owned – for example, what about the beams on the underside of the room that offered it support and what rights were available to carry out repairs.
Without a full and expert check of all of the documentation associated with a practice this anomaly would not have been picked up and the buying dentist would have paid for a room that legally was not the seller's to sell!
Author
Nicola Chappell
Goodman LegalNicola joined the commercial property department in 2005 as a legal clerk. She qualified as a solicitor in 2008 and was appointed as a director in 2011. She now specialises in the sale and purchase of dental practices dealing particularly with the property aspects of business acquisitions and the smooth progress of exchange of contracts and completion. Goodman Legal, lawyers for Dentists, has many years’ experience in providing legal services to dentists setting up their own practices and buying and selling practices. For more information, call Ray Goodman on 0151 707 0090 or email rng@goodmanlegal.co.uk.
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