Does section 45 FA 2003 require there to be two separate contracts i.e. one between A and B and a second between B and C?

Home Forums Patrick Cannon Does section 45 FA 2003 require there to be two separate contracts i.e. one between A and B and a second between B and C?

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    Julia
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    Does section 45 FA 2003 require there to be two separate contracts i.e. one between A and B and a second between B and C? I have a scenario whereby a sale and purchase agreement provides that A sells the whole of a Site to B and then B sells part of the Site to C. Does the fact of this being stated in one single document jeopardise the subsale relief?

    #574 Reply
    Patrick
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    Julia, a sub-sale of part is within the sub-sale rules (see s45(5) FA 2003) and this can be in one document if you wish but do ensure that as a matter of drafting the two sale contracts are distinct from one another.

    #575 Reply
    Julia
    Guest

    Thanks Patrick. The contract currently has a clause x.1 which says A will sell whole to B and clause x.2 which says B will sell part to C. Both are conditional upon the same conditions being satisfied. In principle, does this sound like a scenario that would qualify for relief under s.45? Many thanks

    #576 Reply
    Patrick
    Guest

    Yes it does. To state the obvious it would be prudent to ensure that the flow of funds through the solicitor’s accounts reflects the payment from C to B and then from B to A ie separate accounts and avoid C paying A direct to preserve the integrity of the sale of whole from A to B and observe the accounts rules.

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