What are the ramifications for a solicitor who does not comply with Law Society Formula B undertakings and/or did not hold their client's part of the contract at the point of exchange? If the contract later comes into dispute does an action lie with that solicitor or their firm?

In property transactions, a sale contract becomes legally binding on exchange of contracts. It is common practice for exchange to take place by telephone in accordance with the Law Society's Formulae for exchanging contracts by telephone (the Formulae):

1. •

   formula A, where the seller’s solicitor holds both parts of the contract

2. •

   formula B, where each solicitor is holding their own clients signed contract, or

3. •

   formula C, where there is a chain of transactions

Use of the Formulae automatically includes an undertaking by each solicitor to forward the other their client’s part of the contract on the day of exchange, by first class post, document exchange or personal delivery, see Practice Note: Transferring commercial property—a practical guide — Exchange.

Depending on the status of the person who provided with the undertaking,