BRIEFING ON THE CHANCEL REPAIRS BILL 2015 (Michael Hall-LDLA-Solicitor)

BRIEFING ON THE CHANCEL REPAIRS BILL 2015

The abolition of Chancel Repair Liability ('CRL') was proposed by the General Synod of the Church of England in 1982. The report of its Standing Committee under the Archbishop of

Canterbury Robert Runcie, was accepted by the Synod. Accordingly the Law Commission in 1985 duly reported recommending the General Synod's decision, and the report was submitted to Parliament. Unaccountably, Parliament then ignored the recommendations.

We now have the opportunity to put this right.

By this Bill Parliament will enact the proposal of the General Synod of the Church of England, and the Law Commission's recommendation.

The Bill is likely to be scheduled for a second reading shortly. 11 March is a possible date. It is in accordance with Liberal Democrat principles as the preamble to our Constitution states we are against all forms of entrenched privilege. The late Lord Avebury introduced the Bill in the Lords last year. It will tidy up the law of property in England, and simplify property transactions, by getting rid of the CRL attached to the ownership of land.

Lord Avebury asked a question on this subject in the Grand Committee on 15 January 2015, which Lord Ashton of Hyde, answered on behalf of the Coalition Government. Lord Ashton of Hyde suggested that CRL could not be abolished without the Government compensating PCCs for the loss of a property right. Column GC287.  However Lord Avebury pointed out the generous support that the Government already provides to Churches through schemes such as the Listed Places of Worship Scheme (whereby VAT on church repairs is remitted). 

The compensation stock which the Government provided for the extinguishment of tithe rentcharges under the Tithe Act 1936, should also be mentioned here, as it very largely  compensated the churches for the loss of a source of income for chancel repairs.  Tithes are no longer regarded as a legitimate imposition, so neither should CRL be, derived from the system of tithe. There is no legitimate expectation that CRL will never be abolished, since abolition was proposed by the Church itself 34 years ago. Neither the Synod nor the Law

Commission thought there should be any more compensation paid.

 

The right to receive payments in the future under legislation is not a right protected by Article 1 of the 1st Protocol of the ECHR.  James v UK shows that there is a margin of appreciation under which it is recognised that national parliaments are entitled to reform the law in the public Interest without always paying full compensation to anyone affected by such reforms.   There are, therefore, strong arguments for saying that no more compensation is necessary or appropriate. 

Lord Ashton also said that, since 13 October 2013 (when CRL ceased to be an overriding interest) it has been readily discoverable by inspecting the register of title. This is not correct, as the Land Registry continues to register notices of CRL by unilateral notice on application made by the PCC. The Land Registry does not regard this as an 'alteration of the register'. This was made clear in the Land Registry's publication Landnet 38

'Alterations of the register' are governed by section 65 and Schedule 4 of the Land Registration Act 2002. Unilateral notices are registered under section 34; the Land Registry argues therefore that Schedule 4 does not apply to the registration of a unilateral notice, so the consent of the registered proprietor is not required, nor is it necessary for the Church to produce evidence of the existence of the right, or to prove that its claim has priority over the estate of the owner. It can be argued that this is unfair. It is certainly contrary to the view of Lord Ashton of Hyde, that the buyer of property now need not be concerned about the possibility of unregistered claims to CRL.

It means that someone can purchase a property after 12 October 2013 when there is no notice of CRL on the register and then find that the Land Registry registers one unilaterally without his consent. So that fact that CRL is no longer an overriding interest has made no difference. Only by going to the First Tier Tribunal to argue the point, that the right is not binding on his estate, can he get the notice cancelled.

Most people would consider this reform to be in the general public interest. Parliament should also consider the human rights of the property owners, whose titles are blighted by notices of CRL. Three Lords Justices in the Court of Appeal in the Aston Cantlow case held that CRL was an unfair tax and contrary to the human rights of the affected property owners.

There is no specific statutory authority for the Land Registry to register of notices of CRL. The right to claim money from property owners is probably not in itself an interest in their land.  The Land Registry assumes it is. The Law Society has expressed doubts on this.

The General Synod's 1982 decision in principle, to support phasing out of CRL, has been ignored by the Archbishops' Council. They supported the case of Aston Cantlow PCC against Andrew and Gail Wallbank, mainly in order to establish that the Church of England is not a public authority for the purposes of the Human Rights Act 1998, and so can claim 'victim status' if its human rights are infringed.

Law Lords they did not make any other decision on the legal issues relating to CRL. They said that the law of CRL was an anachronism and that it was for Parliament and not the courts to consider reform. That is also the position of the Church. The General Secretary of the General Synod (until recently William Fittall) consistently advised that this is a matter for Parliament, and not the General Synod, to legislate on, and he has never disputed the right of Parliament to reform the law in the public interest.

Tithes were the ancient 'tenths' of the cereal and other crops which the owners of titheable land had to hand over to the Rector of each parish. They no longer exist, but back in Anglo Saxon times tithe was accepted as a religious duty. An obligation of the Rector, attached to the tithe, was to maintain the chancel of the Church. The tithes, and the CRL liability on them, passed to lay rectors when the monasteries were dissolved under Henry VIII.

The Tithe Act 1936 transferred almost all CRL to Parochial Church Councils ('PCCs') when the Government issued compensation stock, for the extinguishment of the tithe rentcharges. An amount of stock estimated to cover the future cost of maintaining the Chancel was then paid to the Diocesan Boards of Finance. However, no compensation stock was paid in the case of land in which tithe rentcharges had merged (because the tithe paying landowner and the tithe owner were the same person, and he remained liable for CRL). That was an insignificant proportion of the whole, and made very little difference to the amount of compensation stock issued. That compensation stock was worth a huge amount of money, and it was paid for by means of a Treasury levy, tithe redemption annuity, which was paid by farmers and other owners of formerly tithed land, between 1936 and 1977.

An exception was made where the tithe rentcharge owner was an institution such as the Dean and Chapter of a Cathedral, the Church Commissioners or an Oxbridge College, whereby the compensation stock was paid to that institution. They have been paying for CRL ever since, and this Bill does not seek to abolish that form of liability.

Generally, where the tithe owner and the tithe payer were the same person, the tithe merged in the land and the liability was transferred from the tithe rentcharge to the land itself. This was unfair as those former title owners remain liable when everyone else has been released from liability by 1977 - though they did not have to pay tithe redemption annuities, they could be made to pay for chancel repairs, even to this day. CRL also exists where land was allotted to a lay rector in lieu of tithe under an Inclosure Award. There is no statute confirming that Inclosure Award liability still exists. The liability is solely based on supposed ancient custom, and customs, like fashions, change over the years.

In the well known case of Aston Cantlow PCC v Wallbank, the Law Lords decided only that the human rights argument put forward by the Wallbanks did not hold water. The Wallbanks lived in the Montgomeryshire constituency of Alex Carlile MP, now Lord Carlile of Berriew, who referred their case to the Law Commission. Charles Harpum, a Law Commissioner, wrote to him to say the Law Commission view was that abolition of CRL would not infringe the human rights of the Church. There is no protection under the ECHR for a statutory right to receive money, which Parliament may decide to bring to an end.

The Bill only abolishes the liability of property owners, great and small, who may unwittingly become liable when they purchase a particular house or field.

The much resented levy of tithe was got rid of in response to public pressure, long ago, in the same way as church rates. In today's mainly secular society, when the right of the many religions and religious denominations to equal treatment under the law is recognised, it is an anomaly that CRL, a remnant of the system of tithes, still exists. No religious group other than the Church of England has the right to sue property owners for chancel repair costs.

The Bill is based on the one appended to the Law Commission Report of 1985, which was made in response to the General Synod, which voted unanimously in 1982 to phase out CRL.

The Bishop of Derby spoke, in the debate in the Grand Committee on 15 January last year, of the need for yet more compensation; but the Churches have had another 34 years, since the Synod took its decision in favour of phasing out, to collect CRL payments from property owners - yet it appears that very little indeed has been collected.

Lord Avebury only heard from a few property owners who had been asked to pay to compound their liability. There have been only two reported cases since 1936 when anyone has been sued for CRL. But over 1,800 notices of CRL remain registered blighting property titles, for no good reason.

Members of PCCs understand that it would not go down well in the parish to make such claims, and so have mostly let CRL go by default.

Baroness Wilcox mentioned in the Grand Committee, the Land Registration Act 2002 was supposed to remove the 'conveyancing trap', by removing CRL's 'overriding' status; but the Land Registry has not changed its procedure  - it will register notices of CRL unilaterally, without the agreement of the property owner, whenever it receives an application from a PCC. The 2002 Act no longer provides any clear legal justification for this procedure.

CRL is based on the custom, but the Chancel Repairs Act 1932 transferred enforcement from the ecclesiastical courts to the county courts. For the first time CRL was treated as a debt like any other, rather than merely a customary payment, enforceable by the ecclesiastical court's admonition.

No compensation was then paid to property owners for the new debt liability imposed on them, and so it has not been an invariable rule or convention that the Government pays compensation whenever the law is changed in a way that affects a citizen's finances (contrary to the suggestion of the Bishop of Derby). If that were so, the administration of the nation's affairs would become impossible, and most of the laws which Parliament passes, could not be passed.

 

Michael Hall

Solicitor

3 March 2016