Buying a Property with a Party Wall Agreement

Introduction to buying a house with a party wall agreement

Buying a property can already be a stressful process but finding out that the vendor has been served with a party wall notice or has served a party wall notice can add to a buyer’s concerns. 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 considers 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 are purchasing a property from a building owner your solicitors should raise enquiries specifically about the party walls. A distinction should be made about historical party wall issues and where enquiries reveal recent works in which case your solicitors should look at the Award and any related correspondence. You will want to know that the building owner has complied with its obligations under the Award.

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

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 also.

As a buyer of a building owner’s interest, it is possible for you to 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 contract for purchase. It is possible if it is known that a building owner is selling to serve a notice jointly so any Award is made relevant to all the parties and can take account of future owners.

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 as above 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 makes an order 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, that 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 is to be apportioned between the outgoing adjoining owner and the incoming adjoining owner.

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 and it is important to seek advice from a solicitor on these issues.

How long is a party wall award valid for?

Does a party wall agreement expire? 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 so if works are not commenced in accordance with the award within 12 months then an Award can become null and void. In terms of actions taken in reliance on the terms of an award, the Limitation Act 1980 would apply so for instance in any actions to recover monies due under an award a 6 year limitation period will apply.

Concerned about party wall agreements when buying a house?

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