Climate Contract Playbook Edition 3
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The statements are designed to be used for leasehold and freehold transactions for both commercial and residential buildings. If leasehold acquisition, then we expect the drafter will suggest that resilience questions are directed to the landlord.
Notes for users
Additional provisions to add to a report on title: Interpretation 1.1
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. Scope of the Review and Limitation of Liability 3.1 [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.] Climate Change Risks The Property could be subject to the following risks in the future as a result of the impacts of Cli-mate Change and the transition to a net zero emissions economy. These risks could affect the fu-ture value as well as the ability to obtain future borrowing against the property and policies of in-surance. 4.1 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. You may also like to discuss with your surveyor how the Property could be made more resilient to the effects of Climate Change. Transition Risks The 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
4.2
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 etc. 4.3 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.
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