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Developers: agree your development rights with care!

28 March 2014

A recent Court of Appeal decision [1] is welcome news for developers who encounter tricky situations with neighbouring land owners. It illustrates the court's practical approach to dealing with the lack of specific easements in a property transfer.

Enjoyment only!

A plot of land comprising part of the former garden of a larger house was sold at auction. There was a clear intention between the parties that the plot would be used for residential development.

A transfer of part was entered into, which included a right of way over a parcel of retained land "for all purposes connected with the use and enjoyment of the property but not for any other purpose".

There was no right included for laying services under the same retained land. In fact, the transfer expressly excluded the grant of other easements.

Would the court imply drainage rights?

The developer proceeded to dig up the retained land to lay services to connect into the mains running under the public highway. The owner of the retained land objected, arguing that there was no easement enabling the developer to do this.

The Court of Appeal held that an easement should be implied, as the land had been sold as a residential building plot and the parties must have intended that an easement of drainage would have been included. Therefore, it held that there was an implied right to install and make connections to the standard utilities.

Ensure your intentions are expressly included in all transfer documents

It is notoriously difficult to establish an easement of necessity, but perhaps this case will make it easier in the future. However, to reduce conflict the best (and most cost effective) approach will always be to expressly include all necessary easements in a transfer before commencing development!

[1] Donovan and another v Rana and another (2014)