What Happens When There is a Change of Ownership at An Adjoining Property?

Question

We obtained planning and buildings regulation approvals to convert our loft and build a ground floor extension to the rear of our property 4 years ago.

In June 2006 we entered into party wall act agreements with both our neighbours as we would be performing works to both sides of our property and to both party walls.  We advised both neighbours that work would be done over a long period and detailed each work on the notice/agreements.  Both neighbours agreed in writing and works progressed.

One neighbour subsequently sold his property.  We tried to contact the new owner in October 2009 to advise that we would be progressing with our ground floor extension (the loft conversion was then complete).  We left a message and heard no further.  We were in the belief that the existing party wall act agreement remained valid.

We have now received a call from the new owner advising that our agreement with the previous owner is invalid, asking for works to cease and providing the name of her surveyor.  She states that she has some water damage in her kitchen.  The excavation work is complete and the walls have been built.  We are due to insert steel beams this week.

Having spoken to her surveyor he advised that our agreement is invalid because:-

All individual works in the agreement should have started within one year of the date of the agreement; and we should have drawn up a new party wall act agreement with the new owner. Is this correct?

He advised us to cease work, which we have done, and that we should put in place a new party wall act agreement.

We are happy to start negotiations to put a new agreement in place if required.  I understand that this would only cover future works on the party wall, i.e. placing steel and one/two courses of bricks to be laid.  Is there a set agreement we should use for this?

In respect of the damage she alleges to her kitchen, how should we proceed?  Her roof is already in a bad state of repair.  Surely if we enter into negotiations re the new party wall agreement the surveyor should only be assessing the impact of future work?  I have been in touch with our insurance company and they have advised that she would need to prove we caused damage and she should go through her household insurance.  Is this correct?  With the appointment of the surveyor under the new negotiations to put in place an agreement cover an award for any damage previously caused?  We don’t know how to progress this.

Answer

The Act does not state specifically what happens when there is a change of ownership at an adjoining property although the prevailing view amongst surveyors is that the incoming owner is bound by the Award.

The Act does state that notices served under section 3 or 6 expire after 12 months. That has been complicated slightly by some old case law (Leadbetter V Marylebone Corporation) where the judge decided that the time limit should only apply when the adjoining owner has consented – not when there was a dispute and an award has been agreed and served on the owners.

As you can see there are a lot of grey areas in the Act. Three and a half years is a long time between notice and starting the work and any schedules taken at the time would be out of date now. I would recommend having a new award prepared.

You are correct in saying that the new award can only cover work yet to be completed – there is generally no provision in the Act for retrospective notices or awards (again there is a piece of case law that contradicts that position although it was for a specific situation that would not apply here).

Regarding the damage, that should not be dealt with in the new award as it is pre-existing. Your neighbour’s surveyor may become involved in attributing blame for that damage but that would be under a client/surveyor rather than an appointing owner/party wall surveyor relationship. You would of course have a duty to repair any damage that can be shown to be caused by you work.