Learning Outcomes
After reading this article, you will be able to explain the nature and significance of chancel repair liability, describe how and when to conduct chancel repair searches, identify the impact of registration on enforceability for both registered and unregistered land, and advise on practical steps such as indemnity insurance. You will also be able to apply these principles to SQE1-style problem questions.
SQE1 Syllabus
For SQE1, you are required to understand the role of chancel repair searches as part of pre-contract due diligence in property transactions. As you revise this topic, focus on:
- The legal basis and historical context of chancel repair liability
- The process and timing of chancel repair searches in conveyancing
- The effect of registration (or lack thereof) on enforceability in registered and unregistered land
- Practical steps for managing risk, including indemnity insurance
- How chancel repair liability interacts with other property interests and the importance of advising clients appropriately
Test Your Knowledge
Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.
- What is chancel repair liability, and when is it enforceable against a purchaser of registered land?
- How does the Land Registration Act 2002 affect the enforceability of chancel repair liability?
- What practical steps should a solicitor take if a chancel repair search reveals potential liability?
- When is indemnity insurance for chancel repair liability usually available?
Introduction
Chancel repair liability is a historic legal obligation that can require certain landowners to contribute to the cost of repairing the chancel of a parish church. For property lawyers, the risk of this liability unexpectedly binding a client makes chancel repair searches a key part of pre-contract due diligence. This article explains the legal background, the process of conducting searches, the impact of registration, and practical steps for managing risk in property transactions.
Chancel Repair Liability: Legal Background
Chancel repair liability dates back to medieval times and originally applied to land that was once owned by the rector of a parish church. The liability can still attach to land today, even if the current owner has no connection to the church or the original landholding.
Key Term: chancel repair liability
A legal obligation requiring certain landowners to contribute to the repair costs of the chancel (the eastern part) of a parish church.
The liability is unusual because it is not always apparent from the title documents and can arise even where the landowner has no actual notice. This makes it a potential trap for buyers and their solicitors.
Chancel Repair Searches in Conveyancing
A chancel repair search is a standard pre-contract search in many property transactions, especially where there is any doubt about the property's history or location. The search is usually carried out by a specialist provider and will indicate whether the property is within a parish where liability may exist.
Key Term: chancel repair search
A search conducted before exchange of contracts to identify whether a property may be subject to chancel repair liability.
The search result will typically state one of the following:
- No risk identified (the property is outside a liable parish)
- Potential risk (the property is within a parish where liability may exist)
- Confirmed liability (rare, but possible if liability is already registered)
If a search reveals potential risk, further investigation or indemnity insurance may be recommended.
Registration and Enforceability
The enforceability of chancel repair liability depends on whether the land is registered or unregistered, and whether the liability has been protected by registration.
Registered Land
Since 13 October 2013, chancel repair liability is only enforceable against a purchaser of registered land if it is protected by a notice on the Charges Register at HM Land Registry.
Key Term: notice (chancel repair liability)
An entry on the Charges Register of a registered title protecting chancel repair liability, making it enforceable against a purchaser for value.
If there is no notice and the property has been transferred for value after 13 October 2013, the liability will not bind the new owner. However, if a notice is entered before completion and registration, the liability will bind the purchaser.
Unregistered Land
In unregistered land, chancel repair liability remains an overriding interest until first registration. This means it can still bind a purchaser even if not registered, unless and until the land is registered and a transfer for value has occurred after 13 October 2013.
Key Term: overriding interest (chancel repair liability)
An interest that binds a purchaser of unregistered land even if not registered, including chancel repair liability until first registration.
Practical Effect
- If a notice is present on the Charges Register, the liability will bind the buyer.
- If no notice is present and there has been a transfer for value after 13 October 2013, the liability will not bind the buyer.
- In unregistered land, liability can still bind unless and until the land is registered and a transfer for value occurs.
Worked Example 1.1
A client is buying a registered freehold property. The chancel repair search reveals the property is in a parish with potential liability, but there is no notice on the Charges Register. The seller bought the property in 2015.
Answer: Because the property was transferred for value after 13 October 2013 and no notice has been entered, chancel repair liability will not bind the buyer.
Worked Example 1.2
A client is buying unregistered land. The chancel repair search reveals potential liability, but there is no entry in the title deeds. What is the risk?
Answer: In unregistered land, chancel repair liability can still bind the buyer as an overriding interest until first registration. The buyer should consider indemnity insurance.
Managing Chancel Repair Liability
If a chancel repair search reveals potential risk, the main options are:
- Further investigation: This may involve checking parish records or consulting the National Archives, but this is rarely conclusive or cost-effective.
- Indemnity insurance: Most buyers and lenders prefer to take out indemnity insurance to cover the risk of future claims.
Key Term: indemnity insurance
An insurance policy that protects the insured against financial loss if a claim for chancel repair liability is made after completion.
Indemnity insurance is usually inexpensive and can be arranged quickly. However, it is generally only available if no approach has been made to the Parochial Church Council (PCC) or if no claim has been made.
Exam Warning
If a solicitor or client contacts the PCC or makes an enquiry that puts the PCC on notice of the property's potential liability, indemnity insurance may become unavailable or much more expensive.
Revision Tip
For SQE1, remember that chancel repair liability can still bind unregistered land until first registration, and that registration of a notice is essential for enforceability against a purchaser of registered land after 13 October 2013.
Chancel Repair Liability and Other Property Interests
Chancel repair liability can affect the value and marketability of a property. Lenders may refuse to lend or require indemnity insurance if a risk is identified. The liability can also interact with other interests, such as leases or mortgages, and may be relevant when advising on title defects or when drafting special conditions in the contract.
Key Point Checklist
This article has covered the following key knowledge points:
- Chancel repair liability is a historic legal obligation to contribute to the repair of a parish church chancel.
- A chancel repair search is a standard pre-contract search to identify potential liability.
- For registered land, chancel repair liability is only enforceable against a purchaser for value if protected by a notice on the Charges Register after 13 October 2013.
- In unregistered land, chancel repair liability remains an overriding interest until first registration.
- Indemnity insurance is the main practical solution if a risk is identified, but is usually unavailable if the PCC has been approached.
- Solicitors should advise clients and lenders of any risk and arrange insurance where appropriate.
Key Terms and Concepts
- chancel repair liability
- chancel repair search
- notice (chancel repair liability)
- overriding interest (chancel repair liability)
- indemnity insurance
