The following paragraphs are partly a repetition of some of the above paragraphs, in connection with unauthorised works. They are meant to provide general guidance only. Further advice may be necessary from your legal adviser and the Planning / Building Control Departments of your Local Authority.
Most works carried out to a residential property (including change of use) will require some statutory consents to be obtained from the Local Authority (Building Control and Planning Departments). Works that change the external appearance of a property usually require planning consent (eg loft / basement conversions and extensions). They will also require Building Control approvals. Internal works to a property will usually require Building Control approvals (eg chimney breast removals, removal of internal walls to create a through lounge or the installation of an under-stairs cloakroom), although in certain cases, planning consents may also be required.
Planning consents are designed to control the use and development of land and buildings in the best interests of the general public. Building Control approvals are designed to ensure that construction works comply with the minimum standards laid down by the relevant Building Regulations. These requirements are further complicated by Permitted Development rights, whereby certain works may be permitted without planning consents, subject to certain strict criteria being satisfied. Properties that are listed or are located in Conservation Areas, will be subject to special planning consents (and in certain cases Building Control approvals). These restrictions are designed to protect the appearance and character of the buildings and their surrounds.
Where building works have been carried out without obtaining the necessary statutory consents from the Local Authority, they are referred to as unauthorised works. The subject structures (eg extensions) or works (eg chimney breast removals) can be removed or be modified by the Local Authority, using enforcement powers granted to them by planning and Building Control legislation.
The problem for a buyer of a house or flat is to determine if any works have been carried out to the property that would have required statutory consents and whether or not these consents have in fact been obtained. It is usually the responsibility of a Surveyor to determine if any works have been carried out to a property (typically during a survey inspection) that would have required statutory consents. It is then the responsibility of the buyers legal adviser to determine if the statutory consents have been obtained or not (as informed by the Surveyor).
Whereas the construction of very visible structures or modifications (eg extensions or loft conversions) often have all the necessary statutory consents, it is very common for internal works / modifications, not to have all the necessary statutory consents, especially Building Control approvals (eg removal of chimney breasts or an internal wall). While most internal works will not require planning consents, almost all internal works will require Building Control approvals. This is to ensure that the works are compliant with the Building Regulations and that (where necessary) they have been supervised by the Local Authority (or a private contractor working on their behalf), who will then issue the relevant legal documentation, confirming compliance (eg a Completion Certificate).
Unfortunately, many builders seem to be unaware of the need for Building Control approvals (or deliberately mislead customers for their own convenience). The same can also be said for the need for Party Wall Agreements, where works are being carried out to a party wall between adjoining properties.
Once unauthorised works have been discovered, it is common for the vendors legal adviser to propose that an Indemnity Insurance Policy be put in place to cover the risks associated with one or more unauthorised works (paid for by the vendor). These are supposed to protect the buyer from the risks of any unauthorised works. They are usually proposed at the very end of the conveyancing process, in what often appears to be a deliberate attempt to pressurise the buyer into agreement with their use, at what is usually a very stressful time.
The problem with these Indemnity Insurance Policies, is that they are very limited in scope and will only cover against the risk of enforcement action being taken by the Local Authority, in respect of the unauthorised work / s. As most of the unauthorised works are of an internal nature, they are not readily visible and so the likelihood of enforcement action been taken is usually low.
The main risk of any unauthorised works is that they may not comply with the minimum standards of the relevant Building Regulations and as such they may be sub-standard and dangerous to both the occupants of a building and members of the public. As Surveyors are not allowed (in normal circumstances) to open up or expose works that are suspected of being unauthorised, they are not able to make a determination as to whether or not the works are to a satisfactory standard or would comply with the relevant Building Regulations. In many cases, it will be found upon further investigation (including exposure works) and inspection by the Local Authority, that the unauthorised works are to a satisfactory standard and retrospective consents are then provided by the Local Authority (by prior arrangement and payment of a fee, with a builder on site to expose and make good after).
Where unauthorised works have been confirmed, the buyer should NOT rely on Indemnity Insurance Policies. Instead the buyer should seek permission from the vendor to carry out sufficient exposure works (by a competent builder) to allow the unauthorised works to be inspected by the Local Authority Building Control officer (or a competent agent acting on their behalf – by prior arrangement and payment of a fee). The inspecting officer will either confirm the works are to a satisfactory standard (and will grant retrospective consent) or will require partial modification works or complete replacement. Where modification or replacement works are required, estimates can then be obtained for these works, prior to a legal commitment to purchase. The purchase price can then be re-negotiated to reflect the likely future costs of carrying out the necessary works. Any further investigations / inspections / obtaining estimates for modification / replacement works, should be carried out by the buyer, in consultation with the vendor. It is not wise to rely on the vendor or his / her agents to act on your behalf in dealing with these matters, due to the obvious conflicts of interest that can arise, along with the possibility of unsuitable contractual arrangements.
In most cases however, the vendor will not be willing to allow damaging exposure works to be carried out (even where a builder is on hand to make good afterwards). In this case the buyer has two options. He / she can either withdraw from the purchase based on the possible risks / costs from the unauthorised works (which may turn out to be unfounded), or he / she can proceed with the purchase. In the latter case, it is likely that the buyer would try to negotiate some reduction in the purchase price to reflect the risks associated with the unauthorised works. When the purchase is complete, they can then carry out the exposure works and have the unauthorised works inspected by the Local Authority to check for compliance with the Building Regulations. However, if substantial modification / replacement works are then found to be necessary, these could prove to be very costly and the buyer will have missed his / her opportunity of negotiating a suitable discount from the purchase price, to compensate for the later costs of compliance.