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#10250 - Sale Of Part - Property Law and Practice

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The Contract provides for the term The Transfer imposes the term
  • Define all the terms accurately

  • Red for the “Property

  • Blue for the “Retained Land

  • Easements and covenants are included by:

    • Special condition

    • By reference to the attached Transfer

  • Use Form TP01

  • In Box 12, new easements and covenants can be created as needed

Mortgages
  • Where the original land is subject to a mortgage and seller wants to dispose of part

  • He must obtain lender’s consent in Form DS3 and a certificate of non-crystallisation if there’s also a floating charge

  • Lender may want all or some of the proceeds to go towards discharging the mortgage

  • Buyer will want an undertaking from the seller to discharge the mortgage

Implied Easements on Sale of Part in favour of buyer 1,2,3 & 4

p410

  1. Necessity

    • Easements to buyer and seller

    • If without it no use can be made of the land

  2. Common Intention

    • Easements to buyer and seller

    • Where the parties would have thought of it during sale

  3. s.62 LPA 1925

    • Easements to buyer only

    • Must be diversity of occupation at the time of the conveyance

    • It creates a new easement by implying words into conveyance to ensure that everything enjoyed with the land passes to the buyer on sale

    • So, a licence to cross a field will become an easement on sale of part

  4. Wheeldon v Burrows

    • Easements to buyer only

    • It will be implied where the right us

      1. Continuous and apparent (e.g. a path, a drain, easily spottable); and

      2. Necessary for the reasonable enjoyment of the land; and

      3. Was being used as a “quasi-easement” by the seller for the benefit of the Part being sold at the time of the conveyance

Expressly Excluding Implied Easements

  • Exclude all: “The Transfer Deed will contain a declaration that it will only operate to grant those easements expressly referred to and will not operate or be construed to imply the grant of other easements” p410

  • Exclude easements of light and air: “There is not included in the sale of part any easement of light and air which would or might interfere with or restrict the free use of the Retained Land for building or any other purpose. The Transfer to the Buyer must expressly exclude those rights” [note: SCPC 3.3 excludes implied light and air easements] p411

Grant Specific Easements

Consider granting or reserving specific easements for:

  1. Right of way (foot and vehicles / times and purposes / specify its extent)

  2. Right for normal services to reach property (phones, drains, water)

  3. Rights of access for maintenance for above

  4. Right of light and air

  5. Think about maintenance, repair and replacement are dealt with

Covenants

p412

  • This is so the seller can protect his Retained Land

  • These must be expressly created

Possible Easements the Seller will Consider:

  • Restrictions on building (e.g. only with seller’s consent, approval of plans)

  • Restrictions on use (e.g. only use for a retail shop selling clothes)

  • To erect and/or maintain a boundary wall or fence

  • Not to cause a nuisance to seller of neighbours

  • Contribute to maintenance of shared facilities (e.g. drains and rights of way)

  • Ensure restrictive covenants will run with the land

  • Positive covenants are not enforceable against successors (but note Halsall mutual benefit)

Drafting a covenant

  1. Who: has to perform

  2. When: do they have to do it and how often and when it can be exercised

  3. How: are they do it and by what specifications

  4. Where: is it to be done, such as where is the boundary and where is it not

  5. Unless: the consent from the seller is required to approve plans

Completion
Registered Unregistered
  • The covenants listed in TP01 will automatically be registered against new title number

  • The dealing has to be registered with Form AP1 and a copy of the transfer containing the covenants within the 30 working days priority period

  • Compulsory first registration is triggered

  • New restrictive covenants will automatically be entered against the new title of the part being sold

  • They are IAREs

  • The seller should retain a note of the restrictive covenants against the buyer

Look at the Official Copy to see any problems, such as:

  1. Mining Entry:

    1. Possible subsidence

    2. Potential right to the minerals underneath

    3. Structural issues

      • Do a coal mining search

  2. Extra name on the title:

    1. Who are they? If only one is selling the property, you won’t take good title

    2. Is there a need to find the missing person or obtain a death certificate?

      • Raise requisitions with the other seller

  3. Two mortgages:

    1. Make sure the property is not being sold subject to an existing mortgage

    2. Ensure it will be discharged by DS3

    3. Get an undertaking from the seller’s solicitor

  4. Restrictive covenants to use:

    1. Tell the buyer anyway, even if it’s not a problem

  5. Positive covenant of maintenance:

    1. Are there discrepancies within the plan?

      • Chancel repair

      • Flood risk

      • Environmental agency for maintenance of river banks

      • CON29R to check that roads are publicly maintained

      • Is contamination an issue?

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