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Property transactions by charities

29 February 2012

The Charities Act 2011 (CA 2011) comes into force on 14 March 2012. The Act repeals the Charities Act 1993 (CA 1993) and part of the 2006 Act. As a result there will be an impact on dispositions to and by charities and the statements they may be required to give in transfers and other documents.

Land Registry is not proposing to amend the Land Registration Rules 2003 (LRR 2003).

As a result of the transitional provisions and savings in schedule 8 of the CA 2011 Land Registry do not believe that:

  1. the repeal of sections 37(7) and 39(1) and (1A) of the CA 1993, under which certain rules in the LRR 2003 were made, affects the validity of those rules
  2. the references in the LRR 2003 to provisions in the CA 1993 need to be changed

Paragraph 1 of part 1 of schedule 8 to the CA 2011 provides for continuity of the law despite the repeals (including that of the CA 1993), which will be made by CA 2011. In addition paragraph 3(1) of schedule 8, provides:

'A reference, express or implied, in any enactment, instrument or document to a provision repealed by this Act is, subject to its context, to be read as being or including a reference to the corresponding provision of this Act, in relation to times, circumstances or purposes in relation to which that provision has effect'.

The practical difference will be that the statements prescribed by LRR 2003 to be contained in dispositions in favour of a charity (rule 179) and by a charity (rule 180) refer (other than in the case of an exempt charity) to sections in the CA 1993 could refer to the corresponding provision in CA 2011.

The standard forms of restriction prescribed in schedule 4 to the LRR 2003 (forms E and F) also refer to sections of the CA 1993 that have corresponding provisions in the CA 2011.

As Land Registry is not proposing to amend the LRR 2003, those completing transfers etc on or after commencement of the 2011 Act can continue to refer to the existing provisions in CA 1993. However, Land Registry says it will be encouraging customers to refer to the corresponding provisions in the CA 2011, rather than those in the CA 1993, when using the prescribed statements. It considers that such practice is permissible on the basis of paragraph 2 of part 1 of schedule 8. Land Registry say that it is their intention from 14 March 2012 that standard forms of restriction forms E and F will contain the corresponding provisions in the CA 2011 when being entered in the register.

When general amendments are next put forward for the LRR 2003 it will propose that the references are changed to the relevant provisions in the CA 2011. Land Registry is updating its practice guide 14 on charities and advise that this will be republished shortly.