THE Church of England is facing a bill which could run into millions of pounds after it lost a legal battle over selling redundant church schools and keeping the proceeds.

The historic judgment in the House of Lords came after two brothers who specialise in genealogical research challenged the Canterbury Diocese over its sale of a primary school near Maidstone. Simon and Nathan Fraser acted on a legal technicality dating from an obscure 19th-century law.

Under the 1841 School Sites Act, landowners were encouraged to grant land to the Church for education, with the proviso that, if the usage changed, possession would revert to their descendants. When the Canterbury Diocese sold St Philip’s school near Maidstone in 1995, it used the £120,000 proceeds towards a middle school on the Isle of Sheppey.

The Fraser brothers tracked down the 18 living descendants and bought up the interests in the case from a number of them. A public notice put up before the school was due to close, in accordance with the law, had alerted the brothers to the potential cash windfall.

Now their investment has been rewarded, as the diocese has been told it acted illegally and must recover and redistribute the cash to the descendants of Jane Mercer and Lewis Wigan. As the land recently sold on for £400,000, there could now be further legal argument as to how much the beneficiaries must receive.

Mercer and Wigan were the two people who, in 1866, gave the land to the Church “for the education of children and adults of the labouring, manufacturing and other poorer classes in the Ecclesiastical District of St Philip Maidstone”.

The partners have a further backlog of 17 cases of church schools, all built on land donated to the Church for the purpose of education, but subsequently closed down. In each case the Church has refused to return the land to the descendants of the original donor and in many of the cases, the schools have already been sold and redeveloped. There could be hundreds of such cases around the country.

The School Sites Act was passed to encourage grants of land under one acre for specified educational purposes. The law stipulates that such grants contain an automatic reversion to the grantor or his successors should the school close. The Act was strengthened by the Reverter of Sites Act 1987, on which the St Philip’s case hinged.

The ruling affects any school closed since 1987 and built on land donated originally under the 1841 School Sites Act.

The High Court initially backed the right of the Frasers to mount a claim on the basis that when the school closed the land should revert to the beneficiaries of the original donors. The Court of Appeal reversed that ruling but the Law Lords have now reinstated it.

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