This depends on the nature, scope and extent of the works, and their location. The more complex the works, the more they will interfere with the adjoining building and the more expensive the buildings are, the higher the Security for Expenses sum is likely to be.
Security for Expenses—both its type and amount—is typically agreed by the two owners.
However, if they cannot reach an agreement, the surveyors involved will resolve the matter by issuing an award under section 10 of the Party Wall Act.
Where major works are planned, such as digging out a basement, it makes sense that the adjoining owner should not have to worry about the building owner’s ability (or inability) to cover any potential losses. This concern is particularly relevant if the building owner is a limited company with unknown, minimal or no assets, or is an offshore entity.
We have seen all sorts of different values, including:
You can find out more about this in our article, "How Security for Expenses is Determined | Party Wall etc. Act 1996 Guide".
Private escrow accounts provide security, trust and transparency to ongoing or ad-hoc payment requirements.
Third-Party Managed Accounts (TPMA's) are a convenient way to manage complex, high-value or even routine payment operations.
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