This search is commissioned to reveal whether or not the property you are proposing to purchase may be affected by a potential “chancel repair” obligation to a Parish Church. Such obligations stem from mediaeval times where land, previously owned by the Church to fund the local rector, had been sold and the new owner took on the repairing obligation attached to that land. Any property located within the boundaries of a Parish where such a liability exists could be “caught”. The penalty is financial in that it involves having to pay whatever amount might be required from time to time for the upkeep and repair of the chancel of the relevant mediaeval parish church. It is often the case that more than one property shares this liability which makes it even more difficult to quantify any potential financial burden.
There was a famous case, (Aston Cantlow v Wallbank) where the Church sought payment from the owners of the rectorial land (it was part of a property called Glebe Farm) to repair the chancel of the local mediaeval Church. The owners of the rectorial land refused to pay and what was originally a £6,000 repair bill in 1991 increased to £190,000 plus VAT and legal fees of well over £400,000 by 2007 as the structure slowly disintegrated.
Where the search reveals an entry, it shows that the property is located within a parish that could charge for repairs to the chancel. It does not show whether or not the actual subject property is located on land that has this responsibility but does indicate a certain level of risk.
You have a number of options open to you should the search reveal that it is, indeed, located in a “risk parish”.
a) Choose not to take any action as the risk is judged to be so low as to not be relevant. If a mortgage is involved the lender will however an indemnity insurance policy to be taken.
b) Take out indemnity insurance to cover the possible costs of repair. The premiums for these policies are currently very reasonable
and are one-off payments at the outset, not annual premiums.
c) Carry out a full search of the National Archive records to find out if the subject property is responsible for these repair costs. Such a search shows whether liability exists indemnity insurance cover would then be more expensive.
Once a full search has revealed that there is a liability this interest has to be noted on the title to the property and cannot then be removed. The law in connection with the noting of these interests changed in October 2013 and a sale for value of the property in any title once that sale is registered at the Land Registry, will mean that the Church will have lost the right to successfully register the interest against the title to the property. However, HM Land Registry’s guidance states they will accept an application to register a notice to protect a former chancel liability repair without checking whether the registered title has been transferred for value since 13 October 2013. Consequently, it is still possible for a notice or caution relating to chancel repair liability to be registered against the Property. Although chancel repair liability entries may be fewer in number, the potential risk to you as a buyer (however remote) still exists and we would therefore consider it worthwhile to obtain an indemnity policy.
You do, of course, have the choice of not proceeding with the purchase of the property if the full search reveals a liability. However, most purchasers take the view that indemnity insurance cover is the way forward. You should bear in mind that the policy only pays out in the event of a demand for a contribution to chancel repair and only up to the level of indemnity you purchase – usually the purchase price of the property. Most policies have escalator clauses so that the level of indemnity increases over a period of time. However, these clauses are not linked to any index that relates to property prices or the potential liability to chancel repair.
This document is for general information only and is not intended to provide legal advice. Dixon Ward accept no liability in connection with any loss suffered as a result of reliance on the information contained in this factsheet.
