Why is indemnity insurance not enough to cover the loft conversion we built?

Our house sale is in danger of falling through because we didn't get a building regulations certificate for the loft conversion we put in. We've offered the buyers indemnity insurance but they say it's not enough. Are they right?
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Question: My husband and I sold a flat two years ago without building regulations approval for a wall we removed between the kitchen and sitting room. We provided the buyers with indemnity insurance and the sale went through smoothly. Now we are selling again and our buyers’ solicitor is saying building regulations consent should have been granted for our loft conversion.

We offered the buyers indemnity insurance, like last time, but they say that’s not enough and are threatening to pull out. Our conveyancer can’t see the problem and claims the buyers are just being difficult. Can you explain? 

Answer: It is not surprising that your buyers’ solicitors have advised them not to accept an indemnity policy. A loft conversion, depending on the extent of the works, will often require both planning and building regulations approval. 

Even if it wasn’t necessary to get planning permission — which only means that plans are legal and comply with the law — building regulations approval certainly would be required. Without it, your buyers do not know whether the conversion has been carried out properly and safely, or, for example, if there are appropriate means of escape in case of fire or another emergency. 

 An indemnity policy will provide insurance cover for action which may be taken by building control for breach of building regulations, but it will not ensure the safety of the conversion. Speak to your solicitor  and to a surveyor to find out about applying retrospectively for a building regulations certificate.

If you have a question for Fiona McNulty, please email legalsolutions@standard.co.uk  or write to Legal Solutions, Homes & Property, London Evening Standard, 2 Derry Street, W8 5EE. We regret that questions cannot be answered individually but we will try to feature them here. Fiona McNulty is a partner in the residential property, farms and estates team at Withy King LLP (withyking.co.uk).

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These answers can only be a very brief commentary on the issues raised and should not be relied on as legal advice. No liability is accepted for such reliance. If you have similar issues, you should obtain advice from a solicitor. 

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