Developing a site - beware of legal obstacles

The key to a successful development is choosing the right site.  Even when you think you have found the perfect place at the right price, there are plenty of things that could get in the way and make your development more expensive or even impossible.  Some are obvious if you know what to look for.  Others will only come to light from formal searches and a title investigation.  A good commercial property lawyer will spot any pitfalls and advise you on the best way to get round them. 

It is vital to pay attention to detail when evaluating a potential development site. The earlier you do this, the better. This will give you the chance to negotiate a release or possibly reduce your bid if you think it will cost extra to deal with obstacles to development. 

In this blog we identify some key risks. 

Rights of way 

The first thing to look out for are signs that someone may have a right of way, over any part of the site, which could prevent you building in a way that interferes with them.  Roadways, paths and gates that lead from one piece of land to another by crossing your site should come under scrutiny.  Your solicitor will check the title documents for any formally granted rights of way and will also ask the seller if they are aware of anyone using the land as an access route, as part of the pre-contract enquiry process.   

Not all rights of way will be formally documented and a particular risk is where people (individuals or the general public) have been using a route informally and without permission for a long time.  If this sort of use continues for more than 20 years, a legal right of way may arise.  Landowners often try to prevent this by erecting signs stating that land is private and that no access is allowed, but these do not always work.  If your solicitor thinks there are enforceable rights of way over the site, they may be able to negotiate a release or agree a diversion but you will probably have to offer a financial incentive to those with rights. 

Pipes and cables 

Another key issue for development is to check for pipes and cables crossing the site.  These could prevent you building on parts of the plot or force you to carry out work in specific ways that may cost more.  Overhead cables will be obvious but it can be harder to spot any which run underground.  Your solicitor can carry out a utilities search for things owned by public utility providers.  If there are any, you will have to comply with statutory rules preventing you building in a way that would obstruct access or cause damage or interference.  There may also be health and safety issues in relation to any high voltage electricity cables.  There could be privately owned pipes underground with something similar to a right of way allowing neighbouring landowners to use them for drainage.  Like rights of way, you may be able to agree a diversion or release in return for payment. 

Rights of light 

Rights of light could be an issue if your development is close to existing buildings and might reduce the amount of light to any windows in them.  This is a complex area of law, so if you think there could be a problem you should ask your solicitor for detailed advice.  Again, the usual solution is to pay for a release but this is not always possible.  Do not be tempted to go ahead in the hope that nobody will complain.  The courts have sometimes ordered developers to take down completed buildings that infringed rights of light and are likely to be tougher if they think you have not acted fairly. 

Restrictive covenants 

One of the things your solicitor will look out for when they review the title documents for your proposed site is any restrictions on how the land may be used.  These could impose a complete ban on specific uses or they might limit the number and type of buildings you could erect.  Sometimes they will prevent a particular use or type of development unless you get consent from a named person.  The extent to which restrictive covenants could get in the way of development plans depends in part on how old they are and how likely it is that there is anyone still around who has the benefit and is likely to enforce.  For older covenants, insurance can be a useful solution but it really depends on the specific circumstances, so this is another issue you should discuss with your solicitor.  

Ransom strips 

Ransom strips can be one of the hardest problems to spot, but they can completely scupper an otherwise successful development.  A ransom strip is a section of land carved out of a plot being sold and retained by the seller.  It will usually be quite small, which can make it hard to spot, and will often be chosen strategically to give its owner leverage over whoever wants to develop the larger site.  This might be to extract a fee or possibly to get a better bargaining position over an issue like rights of way.  A Worcestershire newspaper recently reported on a concrete barrier erected on a ransom strip in the middle of a newly built housing estate, effectively cutting the development in half and caused great inconvenience to some homeowners.  The best way to spot a ransom strip is to look carefully at all the title plans and compare them with any plans drawn up for your proposed development, checking for any gaps.  Your solicitor will be able to help with this but you may also need to involve a surveyor. 

How we can help 

Not all obstacles will be obvious from a site visit, so you need an experienced property lawyer to help unearth any issues in the title or in search results.  We are here to explain anything we discover and help you find practical commercial solutions, so your development can go ahead. 

For further information, please contact a legal adviser in our commercial property team at any of our offices – York, Selby, Malton or Pickering.   

This article is for general information only and does not constitute legal or professional advice. Please note that the law may have changed since this article was published.