Chancel Repair Liability?
What is it?
Chancel repair liability is an ancient interest, and according to The National Archives, potentially benefits some 5,200 pre-Reformation churches in England and Wales. It allows the Parochial Church Council (PCC) to require owners of former rectorial land (which does not need not be in close proximity to a church building) to meet the cost of repairing the church chancel. It does not matter that the land may have been divided into many freeholds – each part of the land is potentially liable for the whole amount – and the liability passes with the land, regardless of whether the owner of the land knows of the liability or not.
Chancel repair liability is classified in law as an ‘overriding interest’ and therefore did not always appear in the title deeds to a property. PCCs are now however proactively identifying and registering land that is subject to a chancel repair liability before the 13 October 2013, as after this date chancel repair liability will only bind new owners of registered land if it is protected by an entry in the title to the property.
There have been numerous calls over the years for chancel repair liability to be abolished but it appears that the Government had no plans to abolish it or to introduce a scheme for its redemption. For the time being, chancel repair liability is here to stay.
How does it affect me?
As mentioned above, if chancel repair liability is established the owner or occupier of property may be called upon to contribute towards the costs of repairing the church chancel. The House of Lords decision in Parochial Church Council of the Parish of Aston Cantlow and Wilmcote with Billesley, Warwickshire v Wallbank in 2003 highlights the potential costs and liabilities to landowners. The facts of the case are detailed but the outcome of the case was that Mr and Mrs Wallbank were liable to pay almost £200,000 to put a church chancel into substantial repair and a similar sum again in legal costs in challenging the liability over a 17-year period.
The formal record which sets out the proportionate liability of all owners in a parish required to contribute to the repair of the church chancel is called the Record of Ascertainments. A search in the records of ascertainment will help to identify the likelihood of liability in respect of a given property as well as the proportion of the total cost to be paid in respect of each liable property. The actual amount to be paid cannot be known until repairs are carried out and their cost established but it is important to be aware that the potential liability is not limited to the value of a property.
What can I do?
A simple check to see whether a property is near a medieval church alone is not sufficient and it is not safe to assume that properties in urban areas will necessarily be free from any chancel repair liability.
Any purchaser or tenant of property should, before it becomes contractually obliged to buy property or take a lease, have their solicitor check the title deeds, the Land Registry and current landowners for information as to chancel repair liability. Internet searches are now available from companies such as Chancel Check, which for a cost of less than £20 provide an indication as to whether or not a property is situated in a parish that continues to have potential, theoretical chancel repair liability.
If an initial chancel repair search reveals that there is a risk, a purchaser or tenant can take out indemnity insurance (for a one-off premium) against the risk of a PCC seeking to recover the cost of repairs, or they can obtain a full search from The National Archives. A full search costs in the region of £100 and provides a more definitive reply as to whether a particular property has a liability. If a full search does reveal a liability, a purchaser or occupier can still approach insurers to obtain an indemnity insurance policy covering the costs of repairs but, given the known risks the policy premium will be higher.
It will often be a condition of any insurance policy that no contact has been made with the PCC alerting them to the potential liability and therefore parties should keep this in mind when conducting their investigations.
Your comment raises an important issue and highlights the need to ensure that any insurance policy that is put in place is ‘fit for purpose’ and does protect against the risk.
Regards
Owen
If you insure now for a 25 year term and liability is registered against your property before next October, do you see the fact that the insurance has an expiry date as something that will have a negative impact on what you can sell the house for in say 5 or 10 years time? In perpetuity insurance seems to me to be the only way of really protecting yourself from this, but so many fixed term policies are sold at only a small saving in cost, and I wonder if I’m missing something in seeing these as an imperfect solution to the problem.
Thanks
Except where liability has been legally apportioned between owners under legistlation, the courts have established that liability is “several”, meaning that the owner of a property which is subject to a liability is severally liable for the whole of the liability (records of ascertainment show what the total proportionate liability will be). If for example a parcel of land is subject to a liability, irrespective of the number of plots the parcel is divided into, the owner of one of the plots is potentially liable for the whole cost. It is possible that in these circumstances the parish council with the benefit of the chancel repair liability could choose to enforce against any one of the plot owners. However the owner that is liable could in these circumstances seek to recover the cost from other owners who ought to have also been found liable.
I found the information on your site helpful but have a question.
I understand that the actual bill for these repairs depends on the size of the original repair bill before it is aportioned to the various owners liable to pay a share, but how is it calculated? Does the proportion depend on the acreage of the property, ie the size of the footprint of the house & garden etc in relation to the total acreage of all who are liable. Ie, is the calculation made by dividing the total repair bill by the liable owners according to their propery size?
Hope you can clear tat point for me.
Regards
George
There is no way of telling what the actual amount payable will be if your property is subject to chancel repair liability: this will depend on the actual costs of repairing the church chancel. A search of the Records of Ascertainment at National Archives will however reveal the proportionate liability for the area and from this it should be possible to calculate the proportion of the repair costs that will need to be paid.
Given the uncertainty surrounding the potential costs, many purchasers will take out (and if buying with a mortgage the lender will insist upon) legal title indemnity insurance. Legal title indemnity insurance is an insurance policy which covers the owner of the property (and depending on the wording of the policy their lender and future owners) against any ‘loss’ suffered as a result of a payment or contribution in respect of chancel repair being demanded. The definition of ‘loss’ will vary from insurer to insurer. The insurance policy involves a single one-off premium payment and can provide cover for a period of 25 years or ‘in perpetuity’. The cost of the insurance policy varies depending on the insurer, the level of cover desired and the type of investigations undertaken into the chancel repair liability (i.e. full liability search at National Archives or short area search alone). As there are a number of variables, the cost of insurance can vary from £60 – £600.
Regards
I am about to purchace the property at 18 morpeth Ave, Borehamwood,WD6 4BN and would like to know what type of funds would be involved in terms of £ if i am involved in “Chancel repair Liability”?