DIOCESE OF GUILDFORD NOTES OF GUIDANCE by the Registrar of the Diocese CHANCEL REPAIR LIABILITY Introduction In many parishes, a person or a body other than the PCC has the responsibility to keep the chancel of the parish church in good repair. This responsibility is called ‘chancel repair liability’ (CRL), and the person or body with the responsibility is called the “lay rector”. This results from the history of legal rights and responsibilities that are special to each individual parish. Although some of the recent publicity about CRL has been unfavourable, it is not always understood that CRL does have a historical rationale and is not an arbitrary charge. CRL means that others may pay for repairs that would otherwise fall on the PCC. Therefore it is an important asset for any PCC in a parish where CRL applies. As trustees, the churchwardens and other members of the PCC have an obligation to safeguard the PCC’s assets. That includes ensuring that the PCC retains the ability to recover the cost of future chancel repair under CRL wherever possible. However, the provisions of the Land Registration Act 2002 (“LRA”) mean that unless steps are taken by the PCC to ascertain and protect the rights that the law gives the PCC this potentially valuable right to recover the cost of chancel repairs will be lost forever. It is estimated that there are in excess of 5,000 parishes that benefit from CRL. This note explains more about CRL, and gives guidance about identifying the persons or bodies which might carry relevant responsibility in respect of your parish. 1. What is CRL? The liability to contribute to the cost of chancel repairs does not affect every parish, or every landowner. The position today is that some parishes have a lay rector, who has a legal obligation to meet the cost of repairs to the church chancel. This liability has existed since long before the Reformation. It arose as the result of ownership of glebe land by the rector of a parish or his entitlement to tithes. Where there is a lay rector, depending on the particular circumstances, the liability today for the repair of a specific chancel may or may not be attached to land. Chancel repair liability attaches to land which has been “rectorial” property at some stage in the past. This included glebe land and tithes, which were property held by the rector of a parish to support himself and out of which he was to discharge his liabilities, including his liability to keep the chancel of his church in repair. In many cases this type of property passed into lay ownership following the dissolution of the monasteries by Henry VIII in the 16th century. Other property became rectorial property, or property to which chancel repair liability attached, later on, sometimes through an award made under an Enclosure Act, or through compositions of liabilities to pay tithes under the Tithe Act 1836 or later Tithe Acts, or through the operation of the Tithe Act 1936, which extinguished various classes of tithe rentcharge. Importantly, in some cases the ownership of land which former rectors held as a benefit of their office still carries with it the burden of repairing the chancel: this is the case for land-based CRL. In essence, if the land to which the liability attaches can be identified, the burden to fund the chancel repair can be enforced against the owner or indeed owners if the land has subsequently been split into different ownerships. Where CRL attaches to land it is today what lawyers call an “overriding interest”. This means that the liability passes automatically with the land, so that when the land is sold or passes to a new owner, the liability is binding on the new owner of the land. In a recent, well-publicised case in 2003 (Aston Cantlow and Wilmcote PCC v Wallbank) the House of Lords affirmed that a PCC could take proceedings to recover the cost of chancel repairs from a lay rector. In other cases the liability does not relate to land, and the provisions of the LRA do not apply. Such a non-land-based CRL cannot be registered at the Land Registry; the lay rectors will continue to be liable for the cost of chancel repairs unless and until a Government repeals chancel repair liability. CRL applies to “substantial repair without ornament” (Aston Cantlow Judgment). It is regarded as extending to more than ensuring that the chancel is kept wind and watertight. The extent of the obligation depends on the particular circumstances. Perhaps essential fixtures and services are required to be maintained; but there is no obligation to repair decorative fittings eg stained glass, ornamental items, furniture or to pay for the ‘improvement’ of the chancel. 2. Who is subject to CRL? Today, CRL continues in the case of some ecclesiastical corporations (notably the Church Commissioners), certain universities and colleges and other corporate bodies as well as private persons (commonly known as lay rectors). It is possible for the CRL in respect of a church to be shared between two or more lay rectors (eg the Church Commissioners and a private individual). In some instances, CRL has been commuted: it is possible for a lay rector to “buy out” chancel repair liability with a one-off commuted payment. In such circumstances the funds are invested by the DBF to be used in case of the chancel requiring repairs in the future. Further information is available from the Diocesan Office. If, following an investigation into the existence of CRL, it is possible to identify a lay rector it may be appropriate to encourage the lay rector to "buy out" the liability by making a one-off commuted payment. This would benefit the PCC in providing a degree of certainty regarding the existence of capital monies to fund future chancel repairs and may also benefit the affected landowner in releasing their land from any further liability that may deter potential purchasers of that land in the future. If the payment of a commuted sum is considered to be appropriate, the PCC must take legal advice from the Registrar about the statutory procedures that need to be followed and the valuations etc that will need to be obtained. 3. What changes are introduced by the Land Registration Act 2002? Under the LRA, chancel repairs will no longer be regarded as overriding interests (that is to say, binding upon an owner of land irrespective of whether this burden is registered on the title of the land). The Land Registration Act 2002 (Transitional Provisions) (No.2) Order 2003 provides that chancel repair liability will continue to be an overriding interest for a limited period expiring on 13 October 2013. After that period, the part of the CRL which is a land-based liability will only be binding on a purchaser of land if the liability itself is registered at the Land Registry. In short, if after 13 October 2013, a purchaser buys land against which CRL is not registered, the purchaser will take free of the liability; the PCC will have lost the legal right to recover the cost of chancel repairs from the lay rector. The LRA applies to land-based CRL only. 4. Do all Churches have a lay rector? No. Churches built after 1840 on land on which a church had not been previously built will not have a lay rector. However, some caution needs to be exercised: many churches have been built and re-built several times over, and it is often not possible to identify a single date when the church was built. As a general rule, chancel repair liability affects churches built before 1840 or that have been rebuilt after 1836 on the site of an earlier church. There are many instances of a church being rebuilt in the 19th century on a former, sometimes medieval, church site. It is important to ascertain whether the church was in existence at the time of the commutation of tithes under the Tithe Commutation Act 1836. In most cases chancel repair liability arose where tithes were commuted to corn rents or allotments of land. This process ended in 1836 when such tithes as had not previously been commuted were either merged in land or commuted to tithe rent charge. Accordingly, any church not in existence at the time of this Act (or built since then on the site of such a church) is unlikely to have a lay rector responsible for chancel repair liability. 5. What action should a PCC take? Firstly, and very importantly, as a charity the PCC has a duty to safeguard its assets. CRL is an “asset” and the PCC is obliged to protect the valuable rights that the benefit of CRL confers on it, whether or not it has exercised the rights in the past. The actions that a PCC should take will depend upon whether the PCC is aware of CRL and the land to which it attaches, or whether it is unaware whether there is a lay rector with potential liability. Action if land with CRL can be readily identified If the PCC believes that a liability for chancel repairs attaches to any land, it should seek advice from its solicitors about registering at the Land Registry a caution against first registration of the land (if the land affected by the liability is unregistered) or registering a notice (if the title to the land is already registered), in order to alert a prospective purchaser to the liability. If this registration is not completed the result will be that the right to recover the cost of chancel repairs will be lost in the event of the transfer of the land after 13 October 2013 to a purchaser without notice of the liability.