Chancery Lane chapel – church can seek compensation

Tuesday, November 3rd, 2015

The Christchurch High Court has ruled the church can ask the Crown to compensate it for the loss of a 999-year lease on the old Holy Cross Chapel in Chancery Lane.

The church had been paying a nominal rent of $1 a year to the owner of the Chancery Lane block, RFD Investments.

The sole director of the company, now in receivership and liquidation, was property developer David Henderson.

The Chancery Lane chapel was damaged but not destroyed in the Canterbury earthquakes.

RFD gave the church $193,000, as a portion of the $9m that Vero paid it as indemnity insurance for the Chancery Lane block.

In late 2012, the Crown compulsorily acquired RFD’s Chancery Lane complex for just over $9m.

The church had valued its leasehold at $9.5m and wanted the Crown to pay it the difference.

Lawyers for RFD’s receivers said the church’s “interest was limited” to a share of indemnity insurance.

Justice Nicholas Davidson found the indemnity insurance payout to RFD reflected the Crown’s notice of intention to acquire the Chancery Lane site and spelt the end of RFD’s occupancy.

But, he said, the church’s leasehold interest “remained in existence and is compensatable”.

A court win for RFD could have blocked a church claim of up to $9 million from the Crown.

Property and development manager Keith Beal said the church wanted only to establish an inner-city chapel that was as large and well-located as the previous one.

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