Sunday October 13, 2013
In order to make the land register and land ownership more transparent, the LRA 2002 provided that chancel repair liability’s status as an overriding interest would end at midnight on 12 October 2013. However, such liability will not simply disappear.
A chancel repair liability is the requirement for an owner of land to pay for the repair of the chancel (the part of the church containing the altar and the choir) of an Anglican parish church. Whether a property is affected depends on the history of the land or the area it is in - properties that are liable can be located anywhere within the medieval historic parish boundary.
Prior to 13 October 2013, chancel repair liability was an “overriding interest” which automatically bound purchasers of affected land under the Land Registration Act 2002 (the LRA 2002). When purchasing commercial or residential property it was standard industry practice for solicitors to carry out a search to ascertain whether a property had a potential chancel repair liability. If a risk was identified, it was typically dealt with by taking out chancel repair indemnity insurance.
A new owner who buys the property after 13 October 2013 will buy it free of chancel repair liability if that interest was not protected by a notice registered at the Land Registry prior to the sale, and indemnity insurance will therefore not be required.
There are exceptions, however - property transferred after 12 October 2013 for nil consideration (for example, a gift or inheritance) may still be subject to chancel repair liability, even where no notice has been entered on the register. In these cases chancel repair indemnity insurance is still likely to be appropriate.
Notice can still be registered after 13 October 2013 (for a fee) if there has been no change in ownership since that date and purchasers should therefore be alive to the potential risk of registration of a notice between exchange and completion of a purchase.
If you have any queries or concerns regarding chancel repair liability please contact Annie Scrimshaw.