Chancel Repair Liability

[Fredsie]

I doubt the MOD would have worried much about incurring this liability, since being a public body they would be spending taxpayer's money rather than their own if asked to contribute! And of course once you've bought the property you've taken over any responsibility from them.

 

Certainly the real risk varies from place to place, but it's hard to know without doing the full Kew search, which can have serious consequences for your ability to get insurance. Is there a actually a church anywhere near you which could be the subject of repairs in the future? If not, the risk of your incurring a large liability would seem small, and it's likely all your ex-military neighbours would also be expected to chip in.

 

But really the trouble is, majsheridan, none of the above will much matter to your purchasers; they'll just want to be secure from any risk and I doubt they'll accept your arguments that there's little risk, even if the arguments are soundly based.

 

This is a topic which all conveyancers are well aware of now so every prospective buyer of your house will raise the same question. You may as well just respond that though you think liability is unlikely, you will deduct the cost of "in perpetuity" insurance from the asking price so that they carry no risk or extra cost. Compared with the price of a house, the typical premiums quoted earlier in this thread seem trivial.

[majsheridan]

Thanks guy for your views.

 

It seems to me that the insurance companies are making alot of money out of this whole thing and we have no way of avoiding the payment.

 

I either pay in the knowledge that my property may actually not be liable, or I don't pay the insurance.

 

If I don't pay then the purchaser's solicitor may press ahead with the full search, the cost of which is likely to be passed on to me.... (and is likely to exceed the cost of the insurance)

 

If the search comes back and shows that my land is liable then I will be un-insurable and the purchasers will likely pull out, and I will struggle to find new purchasers.

 

I personally feel that it is the purchasers choice as to whether or not they want this insurance, and don't see why I should pay for it!

 

As a matter of principle I may offer to reimburse the purchasers 50% of the policy upon receipt of proof that the policy has been taken out...

 

But then again Fredsie, it is probably easier to pay the whole thing as you say rather than risk delaying or loosing the sale!

[Fredsie]

That's it in a nutshell! It's a crazy situation which has allowed the insurance companies to create a racket which amounts to a licence to print money. (But then again, hasn't printing money become fashionable recently? )

Edited March 26, 2009 by Fredsie

[RH79]

Listen - Just insure against it. Dont dig to deeply. Take the insurance (like i have) and get on with your life. What is £50-70 against a bill of several thousands. It is surely a no brainer!

 

I asked my solicitor how many people did a full search and he said......... none! Dont sweat it

Edited March 26, 2009 by RH79
spelling error!

[JonCris]

RH correct for the sake of a couple hundred quid AND piece of mind it's a no brainer

 

Also if you look too deeply & discover you ARE liable you won't be able to get insurance and as your conveyancer is required to register the fact making your property even harder to sell

[Stuart Murray]

The land my house is built on is shown as common on the tythe map for the area (map dates from somewhere between 1836 and 1850). Can anyone help me ascertain whether or not common land is likely to have any chancel repair liability associated with it.

[pommymike]

I would try Google and search with the name of your County and Inclosure Awards or Enclosure Awards, try both spellings. This would reveal whether there are Enclosure Awards in your County.

 

If Common Land has been built on this may be because it ceased to be Common Land when an Enclosure Award was made.

 

Tithes could have been payable out of the Common Land until the Inclosure Commissioners awarded it to the lay rector (the person who collected the tithes) in lieu of tithe.

 

After that the income from corn, rents or whatever received from land allotted in lieu of tithe was supposed to be used by the lay rector to pay for the chancel repairs.

 

Enclosure Awards can be looked at in the County Archives at your County Council Offices or may be available on Archeological Societies' websites, or copies obtained from the National Archives.

[Stuart Murray]

Thanks pommymike. I shall try to find out more about any enclosure awards from the local records office. Meanwhile I have found the following note from 1845 relating to the village church: The glebe here is 92A. 1R. 9P., and the tithes have been commuted for £520 per annum. I am not sure what this means but it sounds like it could be useful?

[JonCris]

Be careful cos if you do establish your within the boundry & possibly subject to Chancel repair not only will you have to notify the Land Registry but you may be unable to obtain insurance - unless Pommy knows different of course

[pommymike]

In reply to Stuart's posting of 17 May, the 92 acres of glebe (and one rood - quarter of an acre) could be subject to chancel repair liability.

The tithes were commuted to an annual payment of £520 means they were converted into a tithe rentcharge - a fixed amount rather than one based on the value of each year's crop of corn. The Tithe Acts 1836 and 1839 provided for tithes to be converted into rentcharges throughout England and Wales.

James Derriman in his book explains the different types of glebe and the history from which it is clear that most former glebe land was sold by a clergyman who was relieved of liability by the 1923 or 1976 Measures, so there is no liability.

As the law is so uncertain, no-one can be expected to declare that your land is subject to liability.

If there is liability under section 31 of the Tithe Act 1936 because tithe rentcharges merged in the land out of which they were payable, the Land Registry will, if requested, note on the register the apportioned amount of the tithe rentcharge which was payable out of the land (as the chancel repair liability is limited to that amount).

(Patrick Milne of the Land Registry headquarters has confirmed this to me). Hopefully this should then mean the registration has no effect on your property value, as it is like any other very small rentcharge - insignficant.

[ocpsteve]

Just had this response from my solicitor with regard to the 2013 deadline for churches to register interests:

 

"2013 is a significant date as the Churches only have until this time to register their interest at the Land Registry. If they have not done so by this time then their right is unenforceable - however there is one critical exception to this. They are still able to register their interest after October 2013 whilst you are still the proprietor. "

 

Assuming she is correct that means only purchases of property after October 2013 will be protected by this deadline ...

 

So people who have owned property before October 2013 are still at the same risk.

 

I've read through this thread and not spotted this particular point mentioned.

 

Has anyone else come across this important exception to the 2013 deadline?

[pommymike]

After 12 October 2013 chancel repair liability will no longer be an overriding interest, which will mean it will not affect a buyer if it is not registered by that date. Chancel repair liability will still be capable of being registered against your title and it will affect you if you purchased before 13 October 2013. However I presume the Land Registry will cancel the entry when the property is sold after 12 October 2013 if the entry was not made before 13 October 2013.

[Illuminatus]

... If on the otherhand the buyer/seller searches more deeply into it & discovers for definite that you're on Glebe land then you won't be able to insure it & again you will not be required to inform the church, however you will be obliged to inform the Land Registry; which in effect is the same thing.

 

Hmm. I don't like the unavoidable conclusion to which my 'logical' analysis draws me... Replace 'buyer/seller' in JonCris's statement above with 'the church' and a number of very disquieting conclusions result. E.g.

 

The church's searches discover your liability, they register your land, it thereby become uninsurable, and (unless pommymike is correct) essentially valueless.

 

Or

 

The church does all the above but, instead of registering the liability, it sends you a letter explaining the circumstances and suggesting that your family's future financial security and indeed their eternal salvation could be assured for a small donation to the church roof fund...

 

Nah. Silly of me, that sort of thing went out in the middle ages along with the inquistition, opposition to contraceptives, belief in papal infallibility; erm.

 

I

[Ens]

HI

What worry me more if the value of the property after 2013, in case the church register my property.

So if I buy the chancel insurance now (perpeuity etc) , will this insurance cover the lost of market value of my property in future?

[JonCris]

As its insured against Chancel risk it won't lose value. That's the reason for insuring it

[deeplyblue]

Nah. Silly of me, that sort of thing went out in the middle ages along with the inquistition, opposition to contraceptives, belief in papal infallibility; erm.

 

I

Fascinating thing, Papal Infallibility. It only became official Catholic doctrine in 1870. Yup, whatever they believed in the Middle Ages, it was only formally adopted as dogma less than 150 years ago. In that sense it's newer than The Origin of Species, Clark Maxwell's realisation that light and electro-magnetism are a single phenomenon, The Communist Manifesto, the invention of the Periodic Table and a trans-Atlantic cable for telegraphy.

 

Welcome to the modern world.

 

db

[pommymike]

As I think has been mentioned before in other similar threads, the insurers do not not pay out if your property loses value because a notice of chancel repair liability is registered at the Land Registry. They only have to pay out if the church actually claims money needed for chancel repairs. However in that situation I would expect the insurers to try to compound the liability - under paragraph 52 of the Ecclesiastical Dilapidations Measure 1923 - to agree a final capital payment to discharge the liability in full and for ever, so that the notice can be cancelled. This is because once the PCC actually claims money, the insurers have to pay out for the loss of capital value as well as the cost of repairs for which you become liable.

 

As I have said before in various postings, no one seems to know of any actual claims made against individuals, apart from Andrew and Gail Wallbank. I know there are cathedrals and colleges which received compensation stock as they agreed to accept the continuing liability in 1936, when the tithe rentcharges were extinguished, instead of agreeing to the compensation stock being passed to the diocesan boards of finance, and they are regularly paying for repairs out of the funds allotted to them by the Government. Enquiries made by Mr Dennis Cameron, a Vice President of the Law Society, as he stated in a lecture, revealed that only 46 properties in England had notices of CRL registered against them, and that was last year, 5 years after it became possible to register the notices. The official guidance from Church House says that PCCs do not have to register claims if they think there are pastoral reasons not to do so, which obviously is the case and it is why they are not doing so. The Legal Office of the Church wrote to me to say that they intended do look at CRL in 2013 and decide what to do about it. As it is likely that there will be very few registrations, it is almost bound to conclude that the Church should legislate itself to relieve lay rectors of any further liability since this is a law which is clearly obsolete and unworkable.

 

In addition, section 21 of the Tithe Act 1936, which contains the crucial definition of the (extinguished) tithe rentcharges giving rise to liability, was repealed as "spent" in 2004 on the advice of the Law Commission.

 

This was either a diabolical liberty, or a blessing in disguise, depending on your view. It does mean that there is a defence to any claim based on merger of tithe rentcharges as section 31 of the Act can only operate by reference to the now repealed section 21. After a section has been repealed, it can no longer be read though it were still part of the Act.

[JonCris]

Thank you pommymike most informative as usual..... However:) as most conveyancers WILL do the search (if only to cover their own butts) the lay person/buyer will not understand the implications or the lack of risk & I doubt their conveyancer is going to give them any guarantees. Therefore the lack of confidence will stay play a part in the purchase

[lostprophet8305]

Hi - join the discussion beter late than never....

 

 

I looked this repair liability thing up and read that only 5200 (out of the 17000 CofE churches in England) have this right to claim and they are all 'pre-reformation' churches. So by that token if the church in your area was built after 1560ish you'll be OK.... Am I right in sayin this?

[pommymike]

Everywhere in England and Wales is in an ancient parish, and every parish had a pre-reformation church. Later parishes were subdivided and some of the ancient parish churches no longer exist, but you cannot assume that because you are now living in a parish where there is a modern church, you are not in the ancient parish of a pre-reformation church. If you solicitor does a chancel check search this will reveal whether the house is in an ancient parish or tithe district where there is potential chancel repair liability. It is true that the post-reformation churches are not entitled to claim for chancel repairs. This is because it was at the reformation that Henry VIII dissolved the monasteries and sold off their rectories (including the right to collect tithes) to lay rectors. If the original church of your ancient parish has been demolished, there is no problem.

[chrismbee]

Hi,

We have just come across this after a search on a house we are hoping to buy revealed a "potential" liability.

My initial concern about an apparent (to me) [problem] by insurance companies, who profit on fear, led me to read further - and this thread (and other, similar threads) have both worried and incensed me.

I am left with an important question: if the relavent PCC registers its interest (in the property) before the 12/10/2013 deadline, will this mean that (under current law) the property will always be liable? Crucially, would this also mean that, after any existing insurance policies have elapsed (eg. 25 years time), the property is effectively unsaleable?

[unclebulgaria67]

I have read that because of the change from 13/10/2013, it is more likely that claims will be made against this liability, before this date. Also in theory if the PCC does register its interest, the property could always be liable.

 

The policies I have seen charge a 'one-off' premium and the cover lasts in perpetuity, so I am not sure where you get the 25 year period from. If someone buys the house in 25 years time, they also should be able to take out an Insurance policy. So I cannot see that the house would be unsaleable.

 

Bearing in mind the change, from what I have read, it would perhaps be more of a gamble not to arrange the liability Insurance. Your solicitor should be able to shed some light on this and make the arrangements for you.

[chrismbee]

Hi,

Quite simply, the 25 year period is the one offered by the insurance details included by my solicitors, from ChancelSure.

I don't understand how you can say that any future owner could get insurance since, if the PCC has indeed registered before 12/10/2013, there will be a known liability which is effectively uninsurable.

Previous replies by JonCris and pommymike highlight the Government's lack of knowledge or desire to make sense of this ancient & ridiculous law.

All I want to know is if the new house will be saleable in the future, if the PCC does register by the 2013 deadline.

[unclebulgaria67]

There are other policies available which last in perpetuity.

 

If PCC's register before the relevant date, what does this mean exactly? Does it mean that they will definately claim against your property or they want to reserve the option? If it is the latter, then surely no change to the current position and if Insurance is available now, why would they not provide it. As long as the PCC has not sought to claim against your property, at the time you took out the Insurance, then I cannot see a problem.

 

Your best option is to take out Insurance, after doing a little research. Phone the companies and ask questions.

[unclebulgaria67]

Just to assist this is a link to the company I came across that provided cover in perpetuity. I don't know of this company and suggest that you conduct research/talk to your solicitor.

 

Policies & Pricing