Climate clause

Report on Title – Climate Change Clauses

Marni's Clause

Where climate change risk searches are unavailable, standard climate change statements should be added to a report on title to make buyers aware of the future risks that may affect the property.

This is a net zero clause

This clause aligns with Paris Agreement goals, Race to Zero requirements and the Oxford Principles for Net Zero Aligned Carbon Offsetting. For tools and support to use this clause, use our toolkit or join one of our events.

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Why use this?

To improve transparency and reporting about the physical, transition and future liability risks of climate change for properties in the UK.

Disclaimer - please read

The clauses on this website (and published in our Climate Contract Playbook) have been prepared in good faith on a pro bono basis and are free to download and use. The clauses have been drafted and edited by a variety of lawyers and, as such, the approaches to drafting may not conform to any particular drafting norms. We acknowledge this as a consequence of the collaborative drafting process.

The clauses on this website (and published in our Climate Contract Playbook) are provided on an ‘as is’ basis and without any representation or warranty as to accuracy or that the clauses will achieve the relevant climate goal or any other outcome.

This website (and the Climate Contract Playbook) does not comprise, constitute or provide personal, specific or individual recommendations or advice of any kind, and does not contain legal or financial advice. The clauses are precedents for legal professionals to use, amend and negotiate using their professional skill and judgement and at their own risk.

While care has been taken in the drafting of these clauses, neither The Chancery Lane Project nor any of its contributors owe a duty of care to any party in relation to their preparation and do not accept any liability for any errors or omissions, nor for any loss incurred by any person relying on or using these clauses or any other person. Users should use their own professional judgement in the application of these clauses to any particular circumstance or jurisdiction or seek independent legal advice.

At present, all the clauses are based on the laws of England and Wales. We encourage the conversion of these precedent clauses for use in other jurisdictions.

The clause

Additional provisions to add to a report on title

1. Interpretation

The following terms are used in this report:

Climate Change: the long-term and material changes in global or regional weather patterns including, temperature, humidity, precipitation, or wind.

2. Scope of the Review and Limitation of Liability

[No searches are available to clarify the risks to the Property from Climate Change and] we have not sought advice from Climate Change scientists or consultants specialising in climate risk analysis. We have generally summarised the general risks to the Property from Climate Change based on the Bank of England risk analysis but have not taken any steps to verify these risks and express no opinion on the likelihood of their occurrence.

[Note: Property searches are likely to become increasingly available for climate risks to properties, at differing levels of granularity.]

3. Climate Change Risks

The Property could be subject to the following risks in the future as a result of the impacts of Climate Change and the transition to a net zero emissions economy. These risks could affect the future value as well as the ability to obtain future borrowing against the property and policies of insurance.

3.1 Physical Risks – According to the Bank of England, Climate Change “means we may face more frequent or severe weather events like flooding, droughts and storms” and gradual onset changes. As such you should consider whether such events could interrupt your intended use of the Property. For example, it may be more likely that the risks identified in your Flood Risk Report will occur as a result of Climate Change [or even that flooding not shown in that report may be likely]. You may also like to discuss with your surveyor how the Property could be made more resilient to the effects of Climate Change, including heatwaves, drought and energy blackouts.

3.2 Transition Risks – UK government policy has set a target to achieve net zero emissions by 2050. The Property has an Energy Performance Certificate Rating of [    ]. It may be that as a result of policy changes required to achieve net zero you will be required by law to invest in improving the energy efficiency of the Property such as using additional insulation, installing solar panels and battery storage, installing an electric vehicle charging point, swapping gas boilers or wood-burning stoves for heat exchange pumps and taking steps to avoid embedded carbon within the materials of the property when repairing and renovating.

3.3 Future Liability Risk – If you are buying the Property as an investor or business you should report the potential Physical and Transitional Risks to your investors, shareholders or funders so that you have adequately disclosed the Climate Change related financial risks to them.

Glossary references: Climate Change

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