article
Securing services for development land
27th May 2009
Persuading neighbours to cooperate in adjoining development has
never been easy; a recent High Court decision has made it harder.
Vicky Camfield of Browne Jacobson LLP explores the impact of that
decision…
Commonly, when buying land for development purposes, developers
(and their solicitors) will make sure that all necessary easements
are reserved across their neighbours’ land to access and service
the development site. Is that enough to guarantee that a new house
or office building will have all of the services it needs to
function and that its owners or tenants can get to and from it? In
William Old International Limited v Arya (2009) Judge Pelling QC
said not.
In that case the developers, William Old International, had
bought land from their neighbours and constructed a new office
building. The transfer of the development site contained an
easement which enabled the developers to lay service media across
their neighbours’ land for the purposes of connecting services to
the new office building. The neighbouring land was sold. William
Old’s relationship with their new neighbours was strained but they
did agree on the route of new service media which William Old then
constructed on the neighbouring land.
When the time came to connect an electricity supply to the new
office building the supplier, EDF, insisted that the neighbours
should enter into an easement with EDF to permit EDF to connect the
new office building to the mains electricity supply across the
neighbours’ land. The neighbours refused.
At the High Court, William Old argued that the neighbours were
derogating from the original grant of the easement to lay service
media by refusing to enter into an easement in favour of EDF. Judge
Pelling disagreed; the doctrine of non derogation from the grant of
an easement is essentially negative in nature and cannot impose a
duty to take any positive action – in this case, grant an easement
to EDF.
It is worth mentioning that electricity suppliers are entitled
to invoke a statutory procedure contained in the Electricity Act
1989 under which an appropriate way leave can be obtained from the
Secretary of State upon payment of suitable compensation to the
affected landowner. So an unwilling neighbour need not be an
insurmountable obstacle to the supply of services to a new
development. Ironically, given how lengthy and expensive litigation
can be, in the William Old case, EDF did not pursue its statutory
power to secure a way leave because the developers, William Old,
were concerned about how long the statutory process would take and
did not want to underwrite any compensation which EDF may agree
with its neighbours!
Whenever third party cooperation is needed to carry out a
development so that the development can be accessed or serviced, it
is critical to make sure that all those third parties are legally
committed to take the positive steps which are needed. That means
remembering to include a positive obligation on the sellers who
will be keeping land adjoining a development site to enter into
agreements with all relevant authorities and services suppliers and
making sure that obligation is secured against future owners of the
neighbouring land. As well as learning how important it is to
maintain good relationships with neighbours, William Old
International Limited found out the hard way that it is vital to
buy development land well and with all necessary third party
cooperation secured; without that, unexpected cost or delay is
pretty much guaranteed!
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