indemnity inshurance

dr.hristoskov

HI
I had made an offer of a property and was accepted. The property itself has two extensions, one used as a utility room and other used as a summer room. The vendors made the extensions 25 years ago and according to them they have a planning permission for that. Unfortunately they haven’t legalized building plan for these extensions. The offer was made on condition that the vendors will be responsible for the lawfulness of the extensions into the building plan and to cover all costs.
I had a call from the estate agent who has insured me that just the indemnity insurance will be fine.
What is indemnity insurance? Is it the same as to legalised building plan including the two extensions?
Thanks for your replay

Richard_Webster

the extensions would have had to have complied with Building Regulations in force at the time they were built. If nobody can produce any evidence that they did comply then in theory (very, very much in theory) the local Council could take enforcement action by way of injunction in the Civil Courts in respect of the work (and to do that they would have (a) have nothing better to do and (b) be able to prove that the work did not comply).

An indemnity policy will pay out in the exceedingly unlikely event of such enforcement action being taken.

It does not pay out if the extensions were badly built and not in accordance with the regulations and someone suffers loss as a result.

In practice Councils only take action in respect of work that doesn't comply that is less than a year old, unless I suppose there was some really serious public safety issue involved, like with a football ground or theatre. Most Councils don't do that very much at all - I worked in the legal department at Southampton City Council years ago and the 12 yaers I was there we had maybe 3 or 4 building reg cases.

I'd be really interested to know if anyone anywhere knows of a case where a Council has applied to the Civil Courts for an injunction in respect of ordinary residential property because of a contravention that is more than a year old. I think it would hit the national press if they did. Has anyone heard of it actually happening?

Doozergirl

Indemnity insurance covers you in the instance that Building Control put an enforcement notice on the structure.

The chance of that actually happening after 25 years is pretty much zero. Whatever is there must be structurally sound or it wouldn't be standing. Also, nothing built 25 years ago would meet current regs so they're hardly going to go around trying to get things to meet a standard which itself is obsolete, they have enough work to do with current building work.

The indemnity insurance will be fine.

EDIT: Richard got there before me

dr.hristoskov

thanks for your explanations