Indemnity Insurance for Unadopted Road

the_wheels_have_fallen_of

Hi Everyone

I have several threads going on this forum regarding my situation regarding the house I am selling that we have just found out that the part of the road that I live on (extension to existing road). Buyers are being OK about it but wonder whether anyone has had experience of buying indemnity insurance for this type of thing? A friend of mine at work suggested this could be a viable option...

Thanks a lot :-)

ethank

Why is it unadopted? Are they still building?

Land_Registry

Indemnity insurance is often taken out to cover against the costs involved should an issue arise in the future which makes the risk(s) insured against a reality - you know that though I am sure.

Unsure though whether you want some guidance around the unadopted road aspect or whether you are asking whether such insurance is 'worth it'?

If the former then knowing who owns it (adoption is separate from ownership although the local authority can do both once a developer has built the road) and/or what obligations you are under, registered or otherwise will influence any choices you make.

If it is an extension to an existing road that suggests it was laid fairly recently so identifying the owner should be fairly easy as it will be registered - is that so and have you checked re ownership?

If it is registered but unadopted then do you have a right of way over it and/or any obligations to maintain it either on your own or with others? Presumably the indemnity insurance is being considered to cover one or both scenarios but you have not said as yet.

the_wheels_have_fallen_of

ethank wrote: »

Why is it unadopted? Are they still building?

This part of the road is unadopted because the builder went bust 6 months after completing the development and never paid the retention fee to get it adopted by our Council. This has only come to light when I've come to sell the property 8 years on and this is when my buyer's solicitor found this out on their searches ....

the_wheels_have_fallen_of

Land_Registry_representative wrote: »

Indemnity insurance is often taken out to cover against the costs involved should an issue arise in the future which makes the risk(s) insured against a reality - you know that though I am sure.

Unsure though whether you want some guidance around the unadopted road aspect or whether you are asking whether such insurance is 'worth it'?

If the former then knowing who owns it (adoption is separate from ownership although the local authority can do both once a developer has built the road) and/or what obligations you are under, registered or otherwise will influence any choices you make.

If it is an extension to an existing road that suggests it was laid fairly recently so identifying the owner should be fairly easy as it will be registered - is that so and have you checked re ownership?

If it is registered but unadopted then do you have a right of way over it and/or any obligations to maintain it either on your own or with others? Presumably the indemnity insurance is being considered to cover one or both scenarios but you have not said as yet.

Dear LandRegistryRepresentative

Thanks for taking the time to read and respond to my post. I have another thread in this same part of the forum going you might want to take a look at called "after 8 years I find my road is unadopted" - thats got absolute chapter and verse on what has happened here.

I contacted my original solicitor and they said that the road certainly on the original plans was due to be adopted. This never happened because the original builder went bust without paying the £500 retention fee. I dont know who actually owns the road - how do I go about finding that out ?

Also, will the Land Registry records actually show all of this information ?

Look forward to hearing from you

Land_Registry

On that basis I would suspect that the builder owns the road still and if they have gone bust then you would follow it through with regards corporate insolvency. Our online guidance explains how land/property might be dealt with in such circumstances

Historically a developer would build an estate, sell off the plots and then the estate roads would be adopted by the local authority.
In more recent times it has also become the norm for the developer to actually transfer the legal title to the council as well where appropriate.

If the road is simply adopted this carries with it certain obligations on the part of the local authority and they can explain what these are.

If it is also transferred then the local authority also becomes the legal owner.

As the road extension is a new one I would imagine that the land is registered and you can check either online or by post as per our online guidance
The online service is really aimed as postal addresses but you can check land using aerial imagery/plans. Invariably I recommend using the postal option and doing a search of the index map as mentioned in the guidance - I'd check with your solicitor though as they may have already confirmed this

The register will make no mention of the road's adoption or matters relevant to that process. They will all be held by the local authority.

I assume that the property has the necessary rights of way over the roads (new and old ones) as granted by the developer (if it has then another pointer to their owning it) as you focus is on the issue of non-adoption.

If it has not been adopted I assume therefore the buyers are concerned as to what responsibilities/liabilities they may have re the road and it/s upkeep etc

Others have posted on your other thread and I would imagine that you and your solicitor need to explore how either to put the retention back in place and if that does not satisfy the buyer provide them with indemnity insurance depending on what they require cover for.

I am not too sure that the legal ownership aspect will be that relevant at present if the company has gone bust. The local authority will have their own processes and requirements re adoption. Presumably there is no process to deal with adoption where the company has gone bust?

So if we go back to your original question around the indemnity insurance you should find numerous threads on here which refer. Your solicitor should be aware of companies which offer insurance as part of the conveyancing process as it is often the 'modern way' of covering sellers/buyers against the risks involved.

It is also often far cheaper than trying to investigate such matters in detail with no actual positive outcome.

the_wheels_have_fallen_of

Land_Registry_representative wrote: »

On that basis I would suspect that the builder owns the road still and if they have gone bust then you would follow it through with regards corporate insolvency. Our online guidance explains how land/property might be dealt with in such circumstances

Historically a developer would build an estate, sell off the plots and then the estate roads would be adopted by the local authority.
In more recent times it has also become the norm for the developer to actually transfer the legal title to the council as well where appropriate.

Thanks for your really thorough response - I've not

If the road is simply adopted this carries with it certain obligations on the part of the local authority and they can explain what these are.

If it is also transferred then the local authority also becomes the legal owner.

As the road extension is a new one I would imagine that the land is registered and you can check either online or by post as per our online guidance
The online service is really aimed as postal addresses but you can check land using aerial imagery/plans. Invariably I recommend using the postal option and doing a search of the index map as mentioned in the guidance - I'd check with your solicitor though as they may have already confirmed this

The register will make no mention of the road's adoption or matters relevant to that process. They will all be held by the local authority.

I assume that the property has the necessary rights of way over the roads (new and old ones) as granted by the developer (if it has then another pointer to their owning it) as you focus is on the issue of non-adoption.

If it has not been adopted I assume therefore the buyers are concerned as to what responsibilities/liabilities they may have re the road and it/s upkeep etc

Others have posted on your other thread and I would imagine that you and your solicitor need to explore how either to put the retention back in place and if that does not satisfy the buyer provide them with indemnity insurance depending on what they require cover for.

I am not too sure that the legal ownership aspect will be that relevant at present if the company has gone bust. The local authority will have their own processes and requirements re adoption. Presumably there is no process to deal with adoption where the company has gone bust?

So if we go back to your original question around the indemnity insurance you should find numerous threads on here which refer. Your solicitor should be aware of companies which offer insurance as part of the conveyancing process as it is often the 'modern way' of covering sellers/buyers against the risks involved.

It is also often far cheaper than trying to investigate such matters in detail with no actual positive outcome.

Hi There

Thanks for your really thorough and very helpful response. I will follow your advice. I havent been that happy with my solicitor here and in fact, I have so far, done all this work - it was my buyer themselves who alerted me to the fact that their conveyancer had found all this out.... Ill get the reports you suggest and keep you posted

THanks:T

Land_Registry

Whilst you can do a lot of the investigation yourself the key issue seems to be what is it that the buyer is asking for here as it is them you are trying to satisfy.

Whilst you could tackle it by thorough investigation and trying to allay those fears for which they want to be covered against it might be more prudent to simply try and find the cheapest cover for them and pay it?

Others will have a better knowledge of that than I but this is a money saving forum so that could get a wider focus than the legal issues involved?

the_wheels_have_fallen_of

Just to let everyone know that the Council have been to drill the cores in the road. They were slightly out of tolerance from their normal acceptable limits but have agreed to adopt the road !!

They are posting a Notice today for any objections/landowner etc (I think its Section 228 Notice ??) and if nobody objects, then the road will become adopted in 28 days.

There were a few minor alterations to the kerb that they wanted to complete and at first they wanted us to pay but have now said that they will pay for this from the Councillor Improvement Fund!

All in all, I think we have had a very lucky escape, considering the shambles we were in with it early January and the threat of my loss of buyer. Looks like the whole thing will have been sorted out in less than 12 weeks (with no help from my Conveyancing Solicitor either !!!!)

Thanks for all the contributions and help you've all given.

G_M

why start a new thread - lots of duplication of answers!

https://forums.moneysavingexpert.com/discussion/5151882

the_wheels_have_fallen_of

G_M wrote: »

why start a new thread - lots of duplication of answers!

https://forums.moneysavingexpert.com/discussion/5151882

its not a new thread... I had two threads going for different things!