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Chancel Repair Liability - What risk?
The history of chancel repair liability is ancient and complex. It relates to the historic responsibility for upkeep of a church being divided between the rector and the parishioners. The parishioners had a duty to repair the nave while the rector had a responsibility to repair the chancel end. Parishioners’ responsibilities were transferred by legislation to the church and do not pose a problem, however when the lands of the rector became divided by sale into private ownership the responsibility to repair the chancel would have passed also.
In 1983 the Law Commission noted that chancel repair liabilities apply to approximately 5,200 parishes. An important aspect to note is that the land need not necessarily be adjacent to an identifiable church.
A recent case has highlighted the problem. In the case PCC of Aston Cantlow and others v Wallbank (2003) (House of Lords) the owners of a property were held liable for chancel repairs to their local parish church exceeding £95,000.00. When VAT, interest and legal fees are added Mr and Mrs Wallbank owe almost £500,000.00. The House of Lords did highlight in their judgement the unfair nature of the liability calling upon the Law Commission to repeal the laws surrounding this ancient problem.
Legislation is now in place requiring Parochial Church Councils to register chancel repair liability against affected property before 13th October 2013. Any liabilities that are not recorded against a property will be unenforceable after that date.
In the meantime we can offer a ‘Chancel Check’ service by a web-based company who provide a quick data check. Where the result of the check establishes a potential for liability there is the option of an insurance policy which will cost approximately £60 for 25 years of cover up to £250,000.00. Allowing a little more time and expense a formal Chancel Repair Search can be commissioned at a cost of approximately £150.00. One issue to highlight is that if you discover that an actual liability exists you will not be able to insure against the risk of ‘ potential liability’.
The ruling does not mean that a person facing financial difficulties can avoid creditors by simply placing assets in someone else’s name. However it does show that a declaration of trust made in good faith can help to protect a family’s financial security.
Please contact Roger Stone at Chichester or Sarah Evans at Selsey for more information.