Buying a Property with a Party Wall Agreement

Shilpa Mathuradas

Introduction to buying a house with a party wall agreement

Buying a property can already be stressful, but finding out that the person selling the house has been served with a party wall notice or has served a party wall notice can add to a buyer’s concerns.

Assessing any existing party wall agreements is crucial to avoid potential legal issues. So if you are faced with this situation, what should you do?

Whether you are buying from a building owner or an adjoining owner, it is important to ensure that:

1. You or your conveyancer make appropriate enquiries of the seller;
2. You or your conveyancer consider the distribution of payments that may arise after the property is sold;
3. Your conveyancer considers what happens where any rights are accrued under the Party Wall Act 1996.

If you purchase a property from a building owner, your solicitors should inquire about the party walls. A distinction should be made about historical party wall issues and where inquiries reveal recent works.

Your solicitors should look at the Award and any related correspondence in this case. You will want to know that the building owner has complied with its obligations under the Award.

What is a Party Wall Agreement?

A Party Wall Agreement is a legally binding document that outlines the terms and conditions for any building work that affects a shared wall between two properties.

The Party Wall Agreement typically includes details on how the building works will be carried out, such as acceptable working hours, how the Party Wall will be accessed, and any other necessary agreements relating to the work. This document is crucial in preventing disputes and ensuring that the building work proceeds smoothly and legally.

Understanding Party Walls

Party Walls are shared walls that separate adjoining properties, commonly found in semi-detached or terraced houses. These walls can also include garden walls built over or along a boundary. Understanding what constitutes a Party Wall is essential when planning any building work, as it determines whether a Party Wall Agreement is required.

If you’re planning to carry out building work on or near a shared wall, it’s vital to identify whether the wall is a Party Wall. If it is, you will need to serve a Party Wall Notice and potentially enter into a Party Wall Agreement to ensure that all legal requirements are met and to avoid any disputes with your neighbours.

The Party Wall Act 1996

The Party Wall Act 1996 governs the process of serving a Party Wall Notice and creating a Party Wall Award. This Act applies to properties in England and Wales and aims to prevent building work that could compromise the structural integrity of any shared wall between adjoining properties.

Under the Act, building owners must provide a Party Wall Notice to all adjoining neighbours before starting any building work that affects a Party Wall. If the neighbours agree to the proposed works, both parties will sign a Party Wall Agreement.

However, if the neighbours disagree or fail to respond to the Party Wall Notice, a Party Wall Surveyor will be appointed to draw up a Party Wall Award.

This award outlines the terms under which the building work can proceed, ensuring that the interests of both the building owner and the adjoining owners are protected.

Does a party wall award transfer to the new adjoining owner?

As a buyer, you cannot rely on an Award already entered into by the building owner. A party wall award is personal to the original parties. There is no mechanism within the Party Wall Act 1996 for assigning and transferring the benefit of any rights derived by serving a party wall notice. This applies to adjoining owners as well.

As a buyer of a building owner’s interest, you can serve a party wall notice at the exchange of contract and before completion as you are considered an owner if you are someone with the benefit of a purchase contract. If it is known that a building owner is selling, it is possible to serve a notice jointly so any Award is relevant to all the parties and can take account of future owners.

Possessing a contract to sell the building owner’s land allows the buyer to act as a building owner, enabling them to serve party wall notices related to upcoming works.

Where an adjoining owner has consented to the works, the Act is silent on whether a new owner can rely on the written consent given to the previous owner. In such circumstances, it would be sensible to assume that the consent is not transferrable and seek consent again or serve a fresh notice on the new adjoining owner.

As the party wall award is personal to the parties, if a party wall surveyor orders that the compensation is payable, he can only order that this is paid by the building owner named in the Award.

It is, therefore, important that as a building owner selling a property, you seek an appropriate indemnity from the new owner. Equally, as an adjoining owner who might receive some compensation, you will want to agree on how this compensation will be apportioned between the outgoing and incoming adjoining owners.

The issues when selling or buying a property where party wall issues arise are complex largely because the Act does not address the transfer of property within its provisions. It is important to seek advice from a solicitor on these issues.

How long does a party wall agreement last?

Does a party wall agreement expire? The Party Wall Act ensures that any building work affecting a shared wall is conducted legally and with proper consent.

Usually, an award contains a provision that it will become null and void if works do not commence within 12 months from the date of service of the Award on the building owner. If works are not commenced per the award within 12 months, then an Award can become null and void.

The Limitation Act 1980 would apply to actions taken in reliance on an award. For instance, a 6-year Limitation period would apply to any actions to recover monies due under an award.

Concerned about party wall agreements when buying a house?

Contact us today for expert legal advice to navigate this complex area and confidently secure your property purchase. Understanding the implications of party structures is crucial for avoiding disputes and ensuring compliance with the Party Wall Act.

It is also important to consider the potential costs, including party wall surveyor’s fees, which may arise during the process.

To speak with one of our property dispute solicitors, contact us by:

• Filling in our online enquiry form; or
• Calling us on 020 7485 8811