Notes on all SGS exercises and solutions, exam tips and guide to answering exam style questions based on practice exams. These notes helped me achieve a high distinction in advanced commercial property.
Acquisition & Development
Solutions to Identified Development Issues
If the title contains restrictive covenants:
(1) Raise queries with the seller’s solicitors to confirm whether the seller has ever had any issues with the
Restrictive restrictive covenants and whether any appropriate approval was obtained in respect of any potential breaches;
Covenants and
(2) If there are any current past breaches or future intended breaches, consider obtaining restrictive covenant
indemnity insurance; OR
(3) Consider negotiating with PWB for deed of release of restrictive covenant; OR
(4) Upper lands tribunal.
A positive covenant does not automatically bind any successive owners of the property. However, if the official
Positive copies contain an indemnity covenant then by virtue of SCPC 7.6.5 the purchaser of the property will be bound to
Covenants give an indemnity covenant upon purchase and, therefore, will be bound by the positive covenant.
Raise a CPSE with the seller’s solicitors to query whether the positive covenant has been complied with.
Right of Way
If there is a third party which has a right of way over the property which is being purchased by the client, you could
approach that party and request that they enter into a deed of release in respect of the right of way.
Rights Alternatively, you could seek to negotiate a new right of way with the third party so that it does not disrupt the
benefitting development or the client’s use of the land once construction is complete.
Third Parties Right of free passage of services through pipes and to construct pipes
If such rights exist on the property title:
(1) Raise a CPSE with the seller’s solicitor to see who has benefit of them and to see whether such rights have
been exercised whilst the seller has owned the property; and
(2) Once identified, consider approaching the benefitting third party for a deed of release of these rights – this
option should only be exercised if the rights will interfere with the proposals for the development or the use of
the development once completed as it will have time and cost implications.
If there is a tenant on the property and they are still in occupation (query with seller’s solicitors), they may have
security of tenure and be entitled to a new lease under the 1954 Act. If so:
Leases (1) Landlord will need to serve s.25 LTA 1954 notice to terminate the lease relying on ground (f) as there is an
affecting the intention to redevelop;
Property (2) This notice can be served once the contractual expiry date of the lease has passed;
(3) Compensation will be payable if the lease is terminated due to ground (f) which would need to be factored into
the development cost.
The official copies may make reference to a pre-emption agreement in favour of an entity. If this is the case and
Pre-emption this is still in force, the seller will be obliged to offer to sell the property to that entity first before the client is
Agreement able to purchase it.
(1) Ask the seller’s solicitors to provide a copy of the agreement and to confirm that it is no longer enforceable;
(2) If no longer enforceable, notice of the pre-emption agreement should be removed from register.
Charges If there is a charge on the charges register in favour of a lender, you should ask the seller’s solicitors to confirm that
the charge will be discharged on completion.
SDLT is payable on the purchase price of the property.
If the property is opted to tax and it is agreed that the purchaser will pay VAT on the purchase price, then SDLT will
SDLT be payable on: (i) the purchase price AND (ii) the amount of VAT to be paid.
SDLT must be paid within 14 days of completion of the effective date, which can either be completion or the date
upon which the purchaser takes possession of the property (if earlier than completion).
Buyer will be unable to complete their purchase of the property without a SDLT 5 form confirming receipt of SDLT.
, There are two different means by which a right to light can be acquired:
Rights to Light (1) Express deed or (2) Prescription.
Express Deed
A right to light may have been expressly granted to a neighbouring property by deed. This would need to be
checked in the property register of the neighbouring property but may also be revealed in the charges register
of the property the client wants to purchase.
Prescription
• The neighbours may obtain a right to light through prescription if a specific aperture (window) in their building
has enjoyed 20 years’ continuous exposure to light.
• Therefore, it must be determined how long the relevant building at the neighbouring property has been
standing for. Queries should be raised with a surveyor.
• If the building has been standing for less than 20 years, specific steps can be taken to ensure that the
neighbour does not acquire a right to light by prescription in the future (LON).
Light Obstruction Notice – ONLY RELEVANT FOR PRESCRIPTION
If there is no evidence that a right to light has been expressly created by a deed, the client should serve a light
obstruction notice (LON) which would need to be registered as a local land charge, to prevent a right to light
being acquired by prescription.
The lifecycle of a LON is as follows:
(a) The LON would be served on the owner of the neighbouring property;
(b) An application would be made to the Upper Tribunal (Lands Chamber) for a definitive certificate of for
registration of a LON (and for a temporary certificate in the case of an emergency); and
(c) The LON would be registered as a local land charge.
Timing & effectiveness of LON
• The neighbours have one year to object to the LON. If no objections are received within one year of
registration of the LON, the neighbour is deemed to have acquiesced to the light obstruction which would
extinguish any right to light acquired by prescription.
• Therefore, for the LON to be effective, it must be in place for one year (from the date of registration) before
the neighbour’s property reaches 20 years continuous exposure to light. The latest date the LON could be
registered as a local land charge is when the neighbouring property has enjoyed exactly 19 years and 1
day of continuous exposure to light. If the LON is registered after this date, the neighbour would be able to
show 20 years’ prescriptive right to light, which would give them the right to object to the LON by going to
court on the grounds of an actionable interference with the right to light.
Remedies for Breach
• Regan v Paul Properties & HKRUK II v Heaney both provided that if rights to light been infringed, the courts
are prepared to order an injunction for the offending building to be removed rather than a simple payment
of damages.
• However, Coventry (t/a RDC Promotions) v Lawrence stated that more discretion should be exercised as it
may not be appropriate to grant an injunction if the developer had acted fairly. An injunction will be an
appropriate remedy if the injury caused to the person with the benefit to the right to light cannot be fairly
compensated by money.
• If damages are awarded they should relate to the loss of amenity and diminution in value of the land with the
benefit of the right to light.
• Ottercroft Ltd v Scandia Care provided that an injunction was a necessary remedy where the developer
erected a staircase which caused a minor infringement of a right to light but in doing so had broken an
undertaking they had given not to construct the staircase.
Potential Solutions
A developer may resolve any issues with neighbouring properties rights to light in the following ways:
• Negotiating a deed of release of light;
• Redesigning the development;
• Taking out right to light insurance;
• Buying the property which has the benefit of the right to light; and
• With the involvement of a specified authority (defined in s.205 HPA) pursuant to the Housing & Planning Act
2016 (HPA), using the power to override easements and other rights under s.203 HPA which removes the risk
of an injunction. Instead, the person with the benefit of the right to light is entitled to compensation
calculated in accordance with s.204 HPA.
, Stopping-up Order
The CON29 search should be checked to determine whether the roads which are currently on the development site
Reconfiguration are publicly adopted highways. If so, then a stopping up order must be obtained before the roads can be
of Roads - reconfigured.
Stopping up of To obtain a stopping up order, the statutory procedures under the following must be followed:
a Public (1) S.116 Highways Act 1980; or
Highway (2) Part X TCPA 1990.
Both are time consuming and costly. Multiple notices need to be displayed and served on various parties and there
is the possibility of objections being raised and challenged being made.
Any contract for purchase should be made conditional on the stopping-up order being obtained and any time
limits for challenge having expired.
New Roads
• It is possible for the local authority to agree to adopt any new roads built by the developers by entering
into a section 38 agreement with them. Pursuant to this agreement, the developers will have to ensure that the
roads are built to an adoptable standard and will have to maintain the roads for a certain period before they are
formally adopted by the local highway authority.
• If the development is to be leased to any tenants, the tenants would want to make sure that a bond (a
deposit given to the local authority by the developer) is in place so that if the landlord fails to meet the costs of
making the road up to the adoptable standard, this deposit can be used instead of the tenants having to make
any payments.
• If any roads built by the developer are sub-standard the local authority can choose to undertake works to bring
them up to standard and seek to recover the costs of doing so from any frontagers (which will likely be the
developer).
• If the developers do not want the roads to become public highways, they will have to ensure that they are
not inadvertently dedicated as highways, which can be done by the public establishing 20 years’ continuous
use without interruption. This can be resolved by erecting a sign stating that there is no intention of the
landowner to dedicate the land as a public highway.
The CON29 search would confirm whether there are any public rights of way affecting the property.
Reconfiguration If so, the route of the public rights of way would need to be altered and this can be done through negotiations with
of Public Rights the seller and obtaining a public path diversion order under s.119 Highways Act.
of Way This is time consuming and costly as numerous notices must be displayed and served on parties and there is a
possibility of objections being raised and challenged being made.
If a diversion order is needed, the sale contract should be made conditional on the order being obtained and
any time limits for challenge having expired.
Any land which does not fall within the title plan to the property will need to be subject to a SIM search. This will
establish whether the land is registered or unregistered.
Registered Land
Adverse Requirements are:
Possession • Uninterrupted possession for 10 years or more. Can be continuous occupation by different occupiers; and
• That the adverse possessor (usually the seller) intended to possess the land adversely (i.e. that they were not
in occupation under licence or agreement).
To obtain adverse possession, possessor will need to apply to the land registry with the following documents:
• Statutory declaration that they have been in possession for 10 years, which will extinguish current owner’s
title to the land;
• Photos and plan which evidence that they have been in such possession.
The land registry will notify the registered proprietor and any mortgagee who will have 3 months to oppose the
application.
If the application is not opposed, the adverse possessor will be registered as the registered proprietor with the
same class of title as the previous registered proprietor (absolute title)
If the application is opposed, the adverse possessor’s application will be rejected unless one of three conditions
are shown: (i) Proprietary estoppel, (ii) that the adverse possessor is otherwise entitled to the land or (iii) that there
is a mistaken belief about boundary demarcation.
If the application is opposed, the adverse possessor may make a subsequent application after 2 years if it
remained in occupation and at this point its application MUST be granted.
, Unregistered Land
Requirements are:
Adverse • Uninterrupted possession for a minimum of 12 years. This can be continuous occupation by different
Possession occupiers; and
• That the adverse possessor (usually the seller) intended to possess the land adversely (i.e. that they were
not in occupation under licence or agreement).
To obtain adverse possession, possessor will need to apply to the land registry with the following documents:
• Statutory declaration that they have been in possession for 12 years, which will extinguish current owner’s title
to the land;
• Photos and plan which evidence that they have been in such possession.
If successful, the possessor will be granted possessory title initially which can be upgraded to absolute title after 12
years.
The remedies available to landowners of commercial properly regarding squatters are limited:
(1) Negotiate with the squatters;
(2) Issue proceedings to regain possession of the land from the squatters either by seeking:
(i) An emergency interim possession order (complex and costly order); or
Squatter’s
(ii) Obtaining a possession order under CPR Part 55 (more common).
rights
Client will need to submit application for possession supported by detailed witness statement at County Court with
jurisdiction for the land in question.
Court papers must be served on the squatters personally. This can be done by handing them to adult squatters
or attaching them to the site entrance.
Once a court order is obtained, bailiffs must be instructed to remove the squatters.
A landowner retains control of the airspace to a height “necessary for ordinary use and enjoyment of the
land” – Bernstein v Skyviews & General Limited.
Ownership of airspace may be asserted through an action in trespass or nuisance and there is no need to prove
loss to establish a trespass. It may be possible to obtain an injunction to prohibit such trespass.
Therefore, if the jib of a crane will swing over adjoining land, the permission of the adjoining landowners is
Crane Oversail
required and a crane oversail licence will be needed. These will need to be negotiated which will take time.
If the crane will oversail a tenanted building and the tenants have leased the roofspace of the building, their
permission will also be needed.
If the crane will oversail the public highway, permission will also be needed from the local highway authority.
Mines and minerals which are excepted from the registration of the title to the property are owned by a third
party.
Rights Therefore, damage, removal or interference with these rights by, for example – digging foundations or the piling
excepted from process, could amount to trespass, which can lead to a liability for damages or an injunction to stop work.
Registration Solutions:
(M&M) (1) Carry out a survey to establish the scope of and extent of mines or minerals below ground and see if
development proposals interfere with these;
(2) Ask seller’s solicitors if they know the identity of the party owning the mines and minerals and whether anyone
has sought to extract mines and minerals in the past;
(3) Carry out a SIM to see if can establish ownership;
(4) Consider the possibility of obtaining indemnity insurance.
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