Where a developer is acquiring land, whether that be a greenfield site or a brown field site there are a number of title issues that the developer may encounter during the legal due diligence. I have set out below a few of the common issues that we see and possible solutions to them.
Unregistered Land: the Land Registry terrier very often, particularly on large rural areas, has small areas of unregistered land where a third party owner cannot be identified. Where this unregistered land falls on a crucial part of the proposed development (i.e where the access will be located) the developer may need to acquire title to the Property. This could be achieved in the following ways:
- An application is made to the Land Registry to determine the boundary line: the boundaries shown on the Land Registry map are general boundaries and are not the precise boundaries. If the unregistered land the result of an error on the boundary mapping the Land Registry will update it when determining the precise boundary line;
- Hedge and ditch rule: where the unregistered land appears to be a historic ditch there is a rebuttable presumption that the hedge and ditch are in the ownership of the land on the site that the hedge is planted. Therefore, unless there are documents rebutting the presumption showing that ownership of the ditch actually falls the other way the Land Registry would update the register to include the ditch in the title of the land where the hedge is planted;
- Adverse possession claim: where the land has been occupied by the seller and used to the exclusion of all others for a period of 12 or more years an application may be made to the Land Registry for adverse possession of the relevant unregistered land;
- Ad medium filum rule: where the unregistered land is a ditch (without a hedge) or an access way (i.e footpath, track or road) there is rebuttable presumption that the owner of the property adjoining the relevant access or ditch owns to the mid-point and an application can be made to the Land Registry for the unregistered access or ditch to be registered to the owner of the land either side.
Restrictive covenants: Restrictive covenants can be an issue for development where the development would be in breach of the relevant covenant. There are a number of points to consider in relation to restrictive covenants, including the risk that it is enforced and whether or not it would be possible to have it released. Where a restrictive covenant is historic and the beneficiary of the covenant cannot be identified the risk that is it enforced is would be fairly low and title indemnity insurance would be available at relatively low costs to cover against any losses in the event that the restrictive covenant is enforced. Where a restrictive covenant has been created more recently, and it is clear who has the benefit of it, title indemnity insurance is either going to be very expensive or unavailable and therefore it is likely the only commercial route is an express release or variation of the covenant with the party with the benefit of it.
Wayleaves: Often utilities providers secure rights for their equipment to be laid over third party land with a wayleave. Service media within a site will often need to be moved and relocated as part of the development but where the right for the service media to be laid in the land is by a wayleave this agreement is personal to the landowner who made the original agreement and it can be terminated by a new owner by serving notice.
This a brief over view of a few title issues that may arise when acquiring land for development, I will explore more during my next article for the PDF and in the meantime if anyone has any specific questions or thoughts please do contact me.
Anna Clifford Senior Associate
t 03300 452855
m 07743 919284