Overage

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Latest Property News

Section 106 insights—part three—common obligations and common pitfalls, particularly agreed carbon targets and contributions, employment and training obligations, and Grampian obligations

A trust of open land for the benefit of the public does not endure where a disposal of that land is made in breach of the rules about disposals (R (Day) v Shropshire Council)

Property weekly highlights—14 January 2021

The following Property news provides comprehensive and up to date legal information on Property weekly highlights—14 January 2021

Finance Bill 2020—new clauses published on 25 June 2020

The following Employment news provides comprehensive and up to date legal information on Finance Bill 2020—new clauses published on 25 June 2020

Featured Property content

The Standard Conditions of Sale (5th edition: 2018 revision)—a guide to the main provisions

The Standard Conditions of Sale (SCS), currently in their 5th edition (2018 revision), are a set of standard conditions which are commonly...

Constructive trusts

Millett LJ subdivided types of constructive trust into two categories, distinguishing between:•the constructive trust proper, where equity intervenes...

Resulting trusts

Resulting trusts represent one of the three types of trust which do not require to be declared or evidenced in writing. The others are constructive...

Benevolent funds

A benevolent fund is an institution, including a body of trustees, which holds funds on trust for the purpose of relieving poverty amongst a defined...

Practice notes

Quistclose trusts

What is a Quistclose trust?A Quistclose trust is an example of an ‘automatic’ resulting trust, ie a trust which arises where property is transferred...

9th Nov

Practice notes

Standard Commercial Property Conditions (Second Edition)

The second edition of the Standard Commercial Property Conditions came into force on 1 June 2004 and these conditions are incorporated into many...

9th Nov

Practice notes

Derogation from grant and the covenant for quiet enjoyment

The rule against derogation from grant applies in addition to any obligation of quiet enjoyment. It is not excluded by an express covenant for quiet...

9th Nov

Precedents

Specific clauses for transfers—indemnity covenant

Panel 11 (transfer of whole)/panel 12 (transfer of part)—Additional provisions1Definitions[Lease•the lease particulars of which are set out in...

9th Nov

Precedents

Rent authority letter—commercial property

[To be printed on Landlord’s letterheaded paper]Our Ref:Date:To: [insert name of Tenant]From: [insert name of previous Landlord] [of [insert address]...

9th Nov

Practice notes

Oversailing

TrespassTrespass is the unlawful presence of a person on land in the possession of another. The ownership of land includes the airspace above it....

9th Nov

Practice notes

Fixtures and fittings

When transferring an interest in land, any fixtures form part of the land and are transferred with it, unless there is express provision to the...

9th Nov

Precedents

Grant of a right for overhanging eaves

1 The Grantor grants to the Grantee the right for the Grantee and his successors in title as owners or occupiers for the time being of...

9th Nov

Practice notes

Concurrent and reversionary leases

There can be only one lease at a time giving a right to possession and occupation of property. Consequently, if a landlord subsequently grants a lease...

9th Nov

Precedents

Transfer of part

Transfer of partPrecedent transferAn adaptable Word version of the precedent form TP1 can be downloaded, saved or printed from this link:Drafting...

9th Nov

Practice notes

Rent suspension or cesser

Generally, the tenant remains liable for the rent even though the premises have become unusable. Consequently, leases normally contain a provision...

9th Nov

Practice notes

Insolvency—fixed charge receivership

Effect of appointmentA fixed charge receiver is appointed under a legal charge or mortgage and only has power to deal with and dispose of the charged...

9th Nov

Practice notes

Contract races

The Solicitors Regulation Authority’s (SRA) Handbook (SRA Handbook 2011) which contains the Solicitors Regulation Authority’s Code of Conduct (SRA...

9th Nov

In-house

Practice notes

Completion monies—the SCPCs

How should the money be transmitted?Most contracts relating to commercial property incorporate either the second or third editions of the Standard...

9th Nov

Practice notes

Conditional contracts—property

Contracts are often drafted on the basis that a condition or conditions must be satisfied before completion takes place (a condition precedent)....

9th Nov

Practice notes

Differences—joint insured and noting

Joint insuranceJoint insurance arises where two or more people insure separate insurable interests in the same property with the same insurer under a...

9th Nov

Most recent Overage content

Practice notes

VAT treatment of overage

This Practice Note is about the VAT implications of overage payments.Why does this matter?Very broadly, VAT will be due on overage if the original...

Produced in partnership with Martin Scammell 15th Jan

Practice notes

Overage—drafting points

Overage (sometimes known as clawback or deferred consideration) enables a seller to benefit from an uplift in the value of land (eg where planning...

15th Jan

Practice notes

Unpaid vendor’s lien

An unpaid vendor’s lien operates as a type of equitable charge giving the vendor full security in equity for payment of the agreed purchase price. It...

15th Jan

Practice notes

Overage—protecting entitlement

When a solicitor is instructed to draft and negotiate an agreement that includes receipt of overage payments, those instructions include an obligation...

15th Jan

Practice notes

Overage—advice to clients

Overage is a covenant or contractual obligation by the buyer to make an additional payment to the seller in the event that specified events occur. It...

15th Jan

Q&As

Where a purchaser (company) has entered into a legal charge as a way of securing overage sums, should this be registered at Companies House?

Part 25 of the Companies Act 2006 (CA 2006) governs the procedure for a company to register at Companies House a charge that it has created over its...

Produced in partnership with Chris Bryden of 4 King’s Bench Walk 8th Jan

Q&As

A client is in voluntary liquidation and has the benefit of an overage over some land. The liquidation should be finalised shortly. Can the benefit of the overage be assigned to a third party before its finalised?

In answering this Q&A, we have considered the power of a liquidator to deal with the company’s assets after the commencement of liquidation.Section...

Produced in partnership with Simon Passfield of Guildhall Chambers 8th Jan

Q&As

Two neighbouring properties (A and B) have mutual rights of way over a shared access which straddles either side of the shared boundary. The title of property A is subject to a restriction preventing registrations of ‘dispositions by the proprietor of the registered estate’. The restriction relates to arrangements securing an overage. The owners of both A and B are entering into a mutual deed of release. The owner of A wishes to register the deed against the respective titles to evidence the release. Will the release amount to a disposition to the extent that the existence of the restriction will prevent registration of the release against owner A’s title?

The Land Registry consider that such a deed of release would amount to a disposition. The Land Registry Practice Guide 62: easements at section 12.2.1...

Produced in partnership with Carl Fain of Tanfield Chambers 8th Jan

Q&As

Does a local authority have the power to secure overage by way of a legal charge where they are selling council land?

The sale of local authority land is governed by section 123 of the Local Government Act 1972 (LGA 1972). This provides:•subject to the following...

Produced in partnership with Kevin Leigh of No 5 Chambers 8th Jan

Q&As

When selling a piece of land over which there will be an overage provision, is it sufficient for the overage provisions to be contained in a rider to the sale contract which contains a non-merger clause, combined with a restriction on title, or should they be in a separate overage deed?

Overage (sometimes known as clawback or deferred consideration) enables a seller to benefit from an uplift in the value of land (eg where planning...

Produced in partnership with Helen Galley of XXIV Old Buildings 8th Jan

Q&As

Where there is a restriction on a seller’s title to protect overage owed by the seller and the seller gives full title guarantee in a transfer to a buyer, is the seller responsible for procuring the removal of the restriction, or merely a consent from the beneficiary of the restriction?

Full title guaranteeWhere a seller transfers the property with full title guarantee, one of the implied covenants for title is that the seller is...

Produced in partnership with Kevin Leigh of No 5 Chambers 8th Jan

Precedents

Application letter—deferral of SDLT on contingent or uncertain consideration

[To be printed on headed notepaper of applicant including full contact details]HMRCSDLT Deferment Applications[[insert relevant HMRC address]]United...

29th Nov

Q&As

Does the benefit of an overage payment, protected by a restriction in favour of the retained land registered at HM Land Registry, pass on death?

Does the benefit of an overage covenant run with the land?The payment of overage is a positive covenant and so it is possible for the benefit of it to...

29th Nov

Q&As

A client is buying registered freehold land where there are covenants contained in a previous Transfer noted on the title to the effect that no transfer is to be entered into without abiding by provisions of a schedule that relate to making overage payments and entering into a direct covenant with the original landowner. This is protected by a restriction on the title. My client does not want their land to be bound by the covenants but the seller's solicitor has agreed to obtain the removal of a the restriction but not a release from the covenants in so far as they affect the land. Will this be sufficient for my client's land not to be burdened by the overage payments or do I need a release of the covenants as well as the removal of the restriction?

Overage is essentially a contractual obligation or positive covenant to make a further payment and therefore issues arise concerning:•binding the...

29th Nov

Q&As

The terms of an overage deed state that the formula for calculating the overage due is 50% of the difference between (a) land value for that party benefitting from the planning permission at implementation and (b) the purchase price (or apportioned price for the part benefitting from the permission), index linked to RPI from date of purchase. Do the Lexis®PSL overage standard templates provide drafting notes/clauses for index linking and RPI? Would alternative indexes such as HM Land Registry House Price Index or the House Price Index published by the Office For National Statistics be more appropriate?

Overage is a covenant or contractual obligation by the buyer to make an additional payment to the seller if specified events occur. Where the overage...

29th Nov

Q&As

Does an obligation to pay overage in certain circumstances need to be for a specific period or is it possible to impose this obligation in perpetuity?

An overage is an obligation to pay a sum of money to the vendor of land, additional to that which is paid in consideration of the original transfer....

29th Nov

Q&As

Does a parish council (not being an eligible council under the Localism Act 2011) have the power, when agreeing to transfer council property to a developer, to secure deferred consideration by a taking a legal charge over the property?

We have assumed that the land in question is in England.Local authorities in England and Wales are corporate bodies created by statute of the UK...

29th Nov

Q&As

Acting for seller of land subject to untriggered overage provisions—what steps will I need to take to comply with the overage deed on sale and what is the SDLT liability?

Restriction and successor covenantThe question of how to comply with the overage deed will of course depend upon its provisions. However it is likely...

29th Nov

Q&As

Is it possible to assign the benefit of an overage provision in favour of a company to an individual when the company has now been dissolved? The overage provision is entered as a restrictive covenant in the title documents.

It is assumed that the company was dissolved by way of the voluntary striking off procedure or the Registrar of Companies’ powers to strike off a...

29th Nov

Q&As

If an overage provision within a deed executed in 1985 does not contain an overage period, is it still enforceable/valid?

The Perpetuities and Accumulations Act 2009 reformed and simplified the law on perpetuities. However, a deed executed pre 2010 falls to comply with...

29th Nov

Overage

View Property by content type:

Latest Property News

Section 106 insights—part three—common obligations and common pitfalls, particularly agreed carbon targets and contributions, employment and training obligations, and Grampian obligations

A trust of open land for the benefit of the public does not endure where a disposal of that land is made in breach of the rules about disposals (R (Day) v Shropshire Council)

Property weekly highlights—14 January 2021

Finance Bill 2020—new clauses published on 25 June 2020

Featured Property content

The Standard Conditions of Sale (5th edition: 2018 revision)—a guide to the main provisions

Constructive trusts

Resulting trusts

Benevolent funds

Most recent Overage content

Popular documents

The pari passu principle and collection remedies for the office-holder—the position under the Insolvency (England and Wales) Rules 2016

Non-UCITS retail schemes (NURS)

Recklessness in criminal cases

The equity of redemption

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