The Vacant Former Workshop and the Missing EPC
You are instructed to market a 340 sq m single-storey former joinery workshop on a 0.4-acre site. The freehold owner, a retired sole trader, has not traded from it for 14 months. The building is unheated, has single-glazed metal-framed windows and a flat roof with no insulation. There is no EPC on the register. The owner says: 'It's commercial, so it doesn't need one - that's only for houses.' A local developer has offered £285,000, subject to contract, and wants to exchange within five weeks to secure a planning application window. Your agency agreement is sole agency at 2% plus VAT. The owner is keen to accept the offer this week and tells you to 'just get the memorandum moving'.
You have not yet issued particulars, and the developer's solicitor has asked for 'the usual pack' including the EPC.
1. Explain whether the property requires an EPC and what the practical consequences are for marketing and for the proposed five-week exchange.
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The owner is wrong. The EPC requirement under the Energy Performance of Buildings Regulations applies to buildings sold or let, not only to dwellings. A building is exempt only in narrow cases - principally buildings due to be demolished (with relevant planning/listed consent and demolition to begin within a set period), places of worship, temporary buildings used for under two years, and certain low-energy-demand buildings (e.g. stand-alone buildings under 50 sq m). A 340 sq m workshop fits none of these.
So an EPC must be commissioned before marketing and the valid certificate must be available before the property is marketed to the buyer. As agent you should not publish particulars or represent the property as available until the EPC is in hand; the duty sits on the seller but the agent's marketing exposes the breach.
Practical timetable: a commercial EPC on an unheated, single-glazed, uninsulated workshop will likely produce a low rating (possibly E, F or G). Survey and lodgement typically take 5–10 working days. A poor rating does not legally prevent the sale, but it will (a) be a disclosure the buyer's solicitor will chase, (b) trigger the MEES/minimum standards question if the buyer intends to let, and (c) may invite a price renegotiation. Advise the owner now, in writing, that marketing cannot proceed compliantly without it and that the five-week exchange is achievable only if the EPC is instructed immediately. Do not 'just move the memorandum' - flag the risk to the owner and record the advice.
2. The owner refuses to pay for an EPC and says the developer 'won't care'. What is your position as instructed agent?
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You cannot market a property that legally requires an EPC without one. Options: (1) decline to market until the EPC is commissioned, explaining the regulatory exposure; (2) if the owner still refuses, consider whether you can continue to act at all - continuing to market would put you in a position of facilitating a breach and would misrepresent the property's compliance status to the buyer.
The correct professional step is a written record of the advice, a clear statement that you will not publish particulars until the EPC is available, and a note that the owner accepts the risk. If the owner persists, the safest course is to terminate or suspend the sole agency rather than market non-compliantly. Note that the buyer's solicitor will almost certainly require the EPC in the pack, so the owner's refusal is likely to stall the transaction anyway. The commission (2% + VAT on £285,000 = £5,700 + VAT = £6,840) does not justify marketing in breach.