Rural Law: Toby Pound on forthcoming changes in chancel repair liability

Toby Pound of Barker Gotelee

Toby Pound of Barker Gotelee - Credit: Archant

DID you know that if you own freehold property in England or Wales you could be liable to pay a contribution to the repair of your local parish church?

Most clients who instruct us to act for them on property purchases have never heard of chancel repair liability and are astonished that they might become liable for a hefty contribution.

In 2003, a Mr and Mrs Wallbank, who owned a small farm in Warwickshire, received a bill requesting a contribution of more than £90,000 to help with the repairs of the chancel of St John the Baptist Church, Aston Cantlow. They challenged the church’s right to collect such a sum from them but, after a legal battle which ended in the House of Lords, they lost, incurring legal bills of more than £350,000.

So what is chancel repair liability? Its roots can be found in pre-Reformation England. Traditionally, churches were ministered either by a vicar who received a stipend (salary) or by a rector who collected tithes from the parishioners. The rectors of around 5,200 churches were liable for repairing the chancel while the parishioners were liable for the rest of the church.

When Henry VIII dissolved the monasteries in 1535, the land owned by the rectors was sold but the liability to repair the chancel went with it. Nearly 500 years later, that liability still exists.

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Since the Wallbank case, solicitors or conveyancers acting for freehold buyers will invariably make a chancel repair search to establish whether the property is in a parish which is known to have a potential liability. Insurance can then be taken out to indemnify against any future demands.

It is very unlikely that liability will show up on the Land Registry entries for a property, because very few churches have been able or willing to establish individual liability or take the steps required to register the liability against freehold properties.

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The absence of any entry on the Land Register does not necessarily absolve a property from liability because chancel repair liability is treated as an “overriding interest”, still binding on owners of that property even though it does not show on the register.

This, however, will change on October 13, 2013. After that date, if the liability is not actually shown on the Land Registry entries, it will no longer bind future owners of the property, although existing owners will still be potentially liable.

Some churches are taking steps to register liability against individual properties before the deadline but in many parishes it is likely that the liability will steadily fall away.

: : Toby Pound is a partner and head of the property team at law firm Barker Gotelee.

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