Existing clients of ours who have bought or sold land in the last 15 years or so, may be familiar with the concept of Chancel Repair Liability.
Chancel Repair Liability is a liability where property owners are subject to or are obliged to contribute towards the repair to the Chancel of Churches in the vicinity. Although this liability dates back many centuries, it was originally introduced for large land owners to contribute towards the local parish church. Since the introduction of this ancient law, it is likely that these large areas of land have been divided up and therefore this liability could affect the property which you are buying.
It is important therefore, that if your property is subject to Chancel Repair Liability that you are aware of the risks.
There was a fundamental change in the law in October 2013 in how Parochial Church Councils could enforce Chancel Repair Liability against land owners. Prior to this change in the law, the liability was enforceable by the church even if the property owner was unaware of it and the liability was not registered at the Land Registry.
After October 2013, the position changed and the right to demand repair costs was only enforceable against a property owner, if that liability was registered at the Land Registry against the individual property owner’s title. If the land was unregistered, the liability could be registered by way of a caution.
The common way with dealing with such a liability was that purchasers of properties prior to 2013 would have taken out Indemnity Insurance which is effectively an insurance policy covering against any possible liability to contribute toward the repairs of the local Church or any decrease in value as a result of any perceived liability which would affect the value of the property when changing hands.
Changes to the Land Registry’s system will therefore help buyers in the future but it has not completely eradicated the risk. It is important to note that Chancel Repair Liability has not been abolished, nor does the fact that a Church has not registered a Liability by 2013 mean that they will lose the right to apply for registration. The right will only be lost once the property with a registered title changes hands at full market value or when an unregistered property is first registered.
Conveyancing solicitors will continue to advise upon Chancel Repair Liability searches and where appropriate, indemnity insurance arranged with properties which are currently unregistered or which have not been transferred for full market value since October 2013.
If the title to a property reveals that the property is definitely subject to a Chancel Repair Liability, indemnity insurance can be still obtained against any future demands or reductions in value.
For further information with regard to this or any other concerns you may have when buying or selling a property, please contact our Property Department on 01267 237441 or email@example.com.