Chancel repair indemnity - who pays?

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Us or our buyers?

Our buyers' solicitors have asked us to confirm that we will take money off the purchase price to cover this. It's a small amount of money but wouldn't it be down to them to pay? It's for their benefit not ours and the chancel repair search indicates a potential liability, nothing definite.

When we bought our house, we paid. So in our case, the buyer.

We paid when we bought, and when we came to sell the same house, made sure that the new buyers did too. Interestingly, our new house was closer to said church than the old one, but it didn't come up on the search!

However, we found out at the 11th hour that there was an issue with a disputed piece of land at the house, so we paid for the indemnity to protect the buyers. It was a deal breaker and we were desperate to get out of the place (hated it with a passion from the day we moved in), so we happily paid it.

We paid, as buyers. Surely it's an indemnity to protect the buyer as the future owners of the house?

We refused to pay for this for our buyers. As you say, it didn't make sense that we should have to pay, plus if we'd said yes to that they might have started trying it on with lots of other financial requests (which they did anyway, and we said no to all of them).

Don't pay for it. It's a scam.

If your buyers are stupid enough to be taken in by the scam then they should pay.

From what a solicitor friend of mine told me this whole thing will be obsolete next year anyway - so check with your solicitor

Nocake why do you say it's a scam? When I looked it up, the whole idea seemed quite mad to me too and the idea of us paying for it seemed even more ludicrous.

Fishfingers I saw something about it possible changing in Oct 2013. I'm surprised our solicitor has not advised us of this since the letter came via them.

IIRC, it is a genuine provision on certain old glebe properties, and it is something which (for historical reasons I cannot recall) is not necessarily mentioned on deeds. So the church can come up with legal documents which bring this liability,and there have been cases of new owners having to stump up.

This is not illegal, but the situation was ruled unfair. So the Church now has until October 2013 to register all properties for which it has this right, or the right expires.

The buyer should pay any insurance to cover this if they want it. You wouldn't pay insurances for other issues that might affect the property after you have sold up.

Things will change in 2013 but that's irrelevant to the position now, as it will only help people who buy after 2013

In most instances I have come across the buyer pays if they want the protection, but its a matter of negotiating strength really, as with anything like this.

The company that sell the insurance are the same company that provide the search information... conflict of interest... "yes, your house may have a liability so you should buy this insurance that we're selling!!!"

There has been one case where the church has claimed against a liability but this was specifically mentioned in the deeds of the property. Unfortunately this made big news so the company selling the insurance plaster it all over their website and scare people with it.

If a church did claim (and they wouldn't because the church hates this situation as much as anyone - basically it's stopping them making use of other sources of funding) it would be spread across numerous properties and the liability would be calculated according to a historic formula, meaning the liability would be a very small amount for each house.

Solicitors recommend the insurance because they're excessively cautious, scared of getting sued and they don't have to pay it so why should they care?

In our case the sellers paid for CI (well, the house predates the ancient church which was built on the original grounds) so we didn't want to take any chances. They also paid for several indemnity policies which our solictors insisted on, again, just to be sure.

I would say the buyer should pay as this is not a defect with the property nor the fault of the seller.

The case nocake mentions was one that was appealed to the High Court so the legal costs made up most of the headline-grabbing sum owed by the unfortunate couple involved. As far as I know, there's only one reported case and churches only have until June 2013 to register an interest in properties for chancel repair liability so I probably wouldn't bother with it but your mortgage lender may insist.

Sorry, it's October 2013 as Edith rightly says.

Our solicitors recommended a whole bunch of searches and indemnity insurances but a little bit of research will show which ones are worth having in your area. Don't assume everything the solicitor suggests is worth doing. They're covering their arses by recommending everything so a bit of work could save you a fair bit of cash.

When I sold my cottage I'm not sure whether the buyer paid - I know I didn't.

Thanks for your advice. I've advised our solicitors to advise our buyers' solicitors that the buyers should pay. I can't help but think that their solicitors are just trying to pull a fast one in hoping that we'll just think that it's a small amount of money in the grand scheme of things and pay up.