Paragraph 4 Access to local authority records

The results of the search included in the search report required by regulation 8(k) (local enquiries) may fail to answer the enquiries set out in Part 2 of Schedule 7, in the following circumstances—

(a)

the first point of marketing falls before 1st April 2008 (except where a further first point of marketing arises under regulation 3(4) or Part 5);

(b)

a record from which the answer or result could be deduced is held by a local authority;

(c)

that local authority has a policy of not allowing other persons to inspect such records;

(d)

a local authority is not requested to provide the search report;

(e)

any enquiries not answered are the subject of a contract of insurance against the liabilities that if they had been answered, they would have affected—

(i)

an actual buyer’s decision to buy the property; or

(ii)

the price an actual or potential buyer would be prepared to pay for it,

and result in financial loss;

(f)

such a contract of insurance is effected by, and to be carried out by persons so authorised for the purposes of the Financial Services and Markets Act 2000;

(g)

any liability for financial loss arising under paragraph (e) will be met by financial compensation to be paid by a person (other than the persons described in paragraph 6(a)(i) to (iii)) who is—

(i)

a party to the contract of insurance; or

(ii)

another person involved in the sale of the property; and

(h)

such financial compensation is paid by a person mentioned in sub-paragraph (f) if any person mentioned in sub-paragraph (g) fails to pay it (or no longer exists and has no successor); and

(i)

the search report—

(i)

contains a description of the terms and effect of the insurance described in this paragraph; and

(ii)

identifies which enquiries have not been answered and in respect of which the insurance has been obtained.