Beware of Hidden Property Perils

Are you thinking of transferring part of your land to a neighbouring landowner or perhaps selling part of it to a developer? If so, beware! All is not what it seems. Whilst this may sound straightforward, selling part of your land can bring about some tricky legal issues if you’re not careful.

Ultimately, without diligence and care, you could face serious problems when selling your retained land in the future. So, what do we mean? What should you be concerned about? What horrors lurk in the world of property law that could cause your worst fears to become reality?
 

Reserve Your Rights or Face a Grave Mistake

If you sell off part of your land, then care and attention needs to be given to the form of a transfer deed, namely, consider what rights you need to reserve over the land being sold off to benefit your retained land left.  If you sell the land off that your retained land uses as access, then it is essential that you reserve an express right in the transfer deed to allow your retained land to continue to use the accessway sold off.  Similarly, if your retained land uses and connects to services which are under or over the land being sold off, again, you need to reserve a right for your retained land to continue to connect to and use those services. There are also other very important rights that need to be considered. 

Don’t Let Your Land Become a Ghostly Trap

Once the parcel of land is sold off and the transfer is completed, and if you do not reserve the relevant rights of access and services, then your retained land could be effectively landlocked, and you may have created a very wicked and unwelcome ransom situation.

Escaping the Curse: Negotiating with the New Owner

So, what happens if you get this wrong? If you sell the land off that your retained land uses as access or services, the only way for you to get those rights back would be to negotiate with the new owner of the land sold off to enter a Deed of Easement or Deed of Grant. This deed, once completed, would grant the rights you need for your retained land, but beware, the downside is that the new owner of the land does not have to enter such deed in the first place and will most likely look to charge you a premium for grant of these rights and for you to pay their legal costs. What should have been a straightforward sale of part could very well become your worst nightmare!

Spellbinding Clauses You Shouldn’t Ignore

Other matters that need to be addressed in the transfer deed include whether the new owner requires rights over your retained land, whether they must contribute towards the maintenance and repair of any shared accessways or services, whether there is a suitable mechanism in place to enforce payment for these items, whether you wish to impose restrictions on the new owner’s use of the land, or whether you want to claw back a portion of any future sale proceeds if they develop and sell the land. 

Protect Your Land from Future Terrors

When selling part or all of your land, seeking legal advice to ensure all these issues are considered before proceeding is essential. Careful planning will help protect the value and marketability of your retained land and secure your interest in any future developments on the land sold.

The Protectors of Peril Are Here to Help

But fear not; all is not lost! If you’re considering selling off part of your land and wish to avoid any nightmares, the “Protectors of Peril” - our helpful and friendly Commercial Real Estate lawyers here at Birkett Long - are ready to help. We can advise you on all the potential horrors mentioned above. Please contact us if you need any help with these property demons, and of course, Happy Halloween!