Which Law Society Formula would be used when the seller has a related purchase in a chain transaction?

• A. Formula A
• B. Formula B
• C. Formula D
• D. Formula C

Answer: (D)

When dealing with a chain, fixed rules (Formulae) govern how sale proceeds, purchase funds, and mortgages flow between links so the whole chain can complete smoothly. If the seller is also buying in the chain—a related purchase—the formula used is the one that specifically accounts for funding that linked purchase while still making sure there are enough funds to complete the other legs. Formula C is designed for this exact scenario: it sets out how much of the seller’s sale proceeds can be released to fund their own purchase and how any remaining funds are allocated to continue the chain. This avoids diverting funds away from a purchase that depends on the sale, and it prevents shortfalls in other parts of the chain. The other formulas apply to different chain configurations where the seller’s purchase isn’t tied in the same way, so they wouldn’t be correct for a seller with a related purchase.