September 17, 2018 Being a good Neighbour: Party Wall Escrow
No matter how carefully planned, how well executed, it is a brave builder that would guarantee that a project will run on time and without encountering at least one snag along the way. In the majority of instances those snags are minor and easily rectified but there are occasions when a more major problem crops up. And that can prove problematical, particularly if third parties such as neighbours may be affected by the work. That’s where The Party Wall Act 1996 comes into play.
Covering both party walls and party structures the Act “provides a framework for preventing and resolving disputes in relation to party walls, boundary walls and excavations near neighbouring buildings.” This includes providing appropriate notice, the options available in the event of a dispute and potential remedies available in the event of damage. Essentially, if works are going to impact a party wall or if excavations are going to happen within 3 or 6 meters of a neighbouring building, depending on the depth of the works or the proposed foundations, then the party intending to carry out the work must give notice of their intentions in accordance with the act.
The topic of party walls is one which is increasing in visibility, particularly as individuals and businesses seek to maximise the useable space within the footprint of their premises. This is placing an increasing responsibility on surveyors and others to ensure that the requirements of the act are adhered to when advising on property developments. In line with this professional bodies such as the Faculty of Party Wall Surveyors and the RICS provide advice and training in respect of party wall issues.
One of the provisions of the Party Wall Act sets out a pathway for affected neighbours to require security to be provided before work commences. Should there be a Security of Expenses option, the most usual approach is for funds to be deposited with an Escrow Agent. They will hold the monies in accordance with the Payment Services Regulations 2017 until the work is complete, at which time the funds will either be returned to the building owner or a sum paid over to the adjoining owner, as required.
Elemental CoSec Ltd provides a professional, bespoke and fully regulated escrow agent service. If you would like to know more about Party Wall Escrow take a look at our website or get in touch.