Common Area Liability

Common Area Liability
What is Liability/ Fidelity Insurance for the Homeowner’s Master Policy and all common areas?

Buying my first home in a master-planned community. The commitment letter from the loan processor has listed a condition that I provide “evidence of Liability/Fidelity Insurance for the Homeoener’s Master Policy and all common areas.” When I searched the internet, this insurance looked like something condo associations have to purchase? Is this something additional I have to purchase above Homeowner’s insurance? How much will it cost?

Some “master planned” properties are part of an association that charges a monthly assocation fee. Sometimes, this fee will include your portion of the master insurance policy for the association. If you share a wall or a roof, it’s almost guaranteed that you have a master policy. If you have a single family home that is not attached to any other home, your association dues might only cover lawn care/snow removal/common area maintenance.

The liability clause protects the assocation from lawsuits if someone slips on their sidewalks, etc… Fidelity protects you in case of fraud or embezzlement by your association managers. Every association would have this by default, as no one would lend on their properties without it, so don’t worry, it’s not something you have to worry about.

You should be receiving a copy of the assocation documents, so you can review them. You should certainly ask your agent for help.

But really, I’ve almost never made my client go get their insurance binder themselves. I ask you to get me the contact info, and I go do it myself. So that’s a little weird. I’d get the HOA number, and make them get it. They need to provide the insurer with their own mortgage loss payee clause and loan number anyway, stuff you shouldn’t have to do.

One final, very important note: If you are covered under a master policy, your personal property is NOT covered. Not even your kitchen cupboards and appliances. Only the structure. You need to get yourself an HO-6 policy. It’s similar to a renter’s policy, in that it insures your personal property in a home where they aren’t covering the structure. Getting this from the agent you have your car insurance with is a good idea, as you’ll often save money on the car insurance to offset 50% or more of the cost of the HO-6. For my HO-6, it was only about $250 for the whole year. And I saved about $150 annually off my car insurance, so it really was less than $10 per month. Don’t forget to get it!!!!!!

PS the bank won’t require the HO-6. They don’t sound like they’d even have mentioned it to you. But for your own sake, don’t skip it. You can’t control it if your neighbors burn your place down.

First Floor Condo, 55 and over – Margate Florida

Chancel Repair Liability: You Just Can’t Enough Of It

Some of you may have read my previous posts on Chancel Repair Liability, Chancel Repair Liability Updated and King Henry VIII’s Conveyancing legacy.

I have been amazed at the interest generated which range from Chancel Repair Liability Insurers to the Wall Street.

I am particularly indebted to fellow solicitor Neil McCormick from Frome, who has given me the benefit of his learned insights.

I have drawn together some of the input and feedback, and expanded and fine tuned my previous articles to give a better insight on the common instances and practicalities of Chancel Repair Liability in modern Conveyancing practice.

1. Can you be more specific and describe what is a Chancel:

The Chancel is the roughly the area including the altar and the choir stalls, which accounts for pretty much the east end of the Church, or 25% of the total area of the Church.

2. How does Chancel Repair Liability arise?

a) Ownership of Glebe Land (that is ancient land set aside, from which the income was used to upkeep of the parish church)

b) Ownership of Land acquired in lieu of tithes under local Enclosure Acts

c) Ownership of tithes created by local Enclosure Acts

d) Ownership of tithes created by the Tithe Acts 1836

3 Is it confined to Pre Reformation Churches?

The legal obligation to maintain the Chancel was a trade off for receiving income from glebe lands or tithe dating back to around 900 AD.

Henry VIII when he dissolved (or privatised as we would say now) the monasteries, allowed for the first time that the right to this income no longer was confined to a church institution but could be a lay person, the so called Lay Rectors.

4 What is estimate of properties which might be afected by Chancel Repair Liability?

As many as 5200 parishes may be the subject of the Liability

5 What are the most recent Acts which govern the law in relation to Chancel Repairs?

The 1932 Chancel Repair Act transferred jurisdiction from the Ecclesiastical Courts to the County Court.

The main issues are contained in the 1936 Tithes Act

6 What if my property is unregistered at the Land Registry

If your property is unregistered and specific reference is contained in your title deeds to the Chancel Repair liability, the liability will be noted on your title at the time of first registration, even if this occurs after 2013, the cut off date for registered properties

7 Will my house be the only one liable?

In all cases the liability will be joint and several. So your property could be singled out by the PCC.

It would then be for you to seek recompense from others similarly liable

8 Has anyone had to pay up recently to repair the Chancel of their local church?

Yes. The unfortunate Wallbanks ended up selling their farmhouse Glebe Farm, to pay for the repair of the Chancel to St. John the Baptist Church in Aston Cantlow, Warwickshire. The cost of the repairs was estimated at

About the Author

Paul Hajek has been a lawyer for 26 years He has been managing partner of Clutton Cox Solicitors in Chipping Sodbury, Bristol for the last 23 years. His company website is
www.cluttoncox.co.uk
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