Precedents
| Author | Christopher Jessel |
| Pages | 247-271 |
Precedents
PRELIMINARY
The following precedents are supplied by way of illustration and, like all precedents, should be regarded as suggestions rather than as finished forms. Most of them have not been tested in litigation, and some of those that have been were not subjected to full scrutiny. These drafts are intended to illustrate points made in the text, not to supply full precedents for immediate use. Most practitioners will have their own style of drafting and will rely on their own experience. Each property is unique and will need its own terms.
Various standard and specialist precedent works contain detailed precedents covering the use of restrictions on the register and estate rentcharges in the context of service charges, restrictive and positive covenants, management companies and associated structures. Judgments in reported cases often set out relevant clauses in litigated documents. For forms of restriction, see the LRR 2003, Schedule 4 (as amended), which sets out the numerous variations in the forms. In case of doubt, any draft restrictions should be submitted to the Land Registry for approval, particularly if the wording does not fit one of the forms in the Rules.
There will need to be the usual boilerplate clauses for definitions, service of notices, etc. Care should be taken over any clause that references to a party include successors, particularly if any property might be divided in the future. Where a Land Registry form TP1 is used, the provisions will be contained in panel 12; otherwise, they may be in clauses in the body of the deed or in schedules. Where there is more than one individual as a party covenants may be joint and several.
The original transferor or the manager or both will take and retain duplicates of any transfer or other deed. If the dominant land is transferred any benefits should be assigned: if the original transfer is to be sent to the Land Registry and either retained by it or destroyed then the assignment should be either in a separate document from the transfer executed at the same time or in a duplicate transfer taken and retained by the transferee in order to prove title.
248 Positive Covenants and Freehold Land
P1 NEIGHBOUR COVENANT BY SERVIENT OWNER
The Transferee with the intention of binding the [relevant] part or parts of the Property [designated respectively by letters on the plan] and the Transferee’s successors in title into whoever’s hands that part or those parts of the Property may come and with the intention of benefiting [the Transferor’s property] [title number PQ1234] and each part of it capable of benefiting COVENANTS with the Transferor and the Transferor’s successors in title as follows:
To keep the wall between the letters A and B on the plan in good repair.
Within two months of the date of this Transfer to erect a two metre foot high close boarded wooden fence between points C and D on the plan and at all times thereafter to keep it in good repair and replace any damaged parts as soon as practicable.
That any person who opens the gate across the trackway at point E on the plan will shut it after use.
P2 ESTATE COVENANTS
P2.1 Developer’s covenant to do works, pay service charge, etc
The Transferor, so as to bind the parts of the Estate retained by the Transferor [but not so as to render itself personally liable after having parted with all interest in the Estate], covenants with the Transferee [and the Transferee’s successors in title] and separately with the Manager, for the benefit of the whole and every part of the Property to observe and perform the [following] obligations [set out in panel 12.X].
These obligations may include to do works, especially if the development is in course of construction, such as complete the building of estate roads to the standard required by the relevant highways authority and then have them adopted, also to pay service charge on unsold units.
P2.2 Manager’s covenants
The Manager covenants with the Transferor and [(subject to the payment of the Estate Rentcharge)] separately with the Transferee as follows:
1. to maintain, repair, cultivate and where necessary renew, light and cleanse the Common Parts and their facilities and equipment (if any);
Add other covenants as desired, to employ staff, to meet outgoings, etc.
2. to take all reasonable steps to enforce the covenants similar to those in [panels 12.X and Y] entered into by the owners of other properties on the Estate subject to the Transferee giving security for and an indemnity against the costs of enforcement.
P2.3 Developer’s covenant to pay service charge to manager
The Transferor, so as to benefit the Property and each and every part of it, and so as to bind any Unit from time to time vested in the Transferor, covenants with the Transferee to pay to the Manager a fair and reasonable proportion of any costs, expenses and outgoings attributable to such Unit incurred by the Manager in performing the Services for the Estate in respect of such Unit.
250 Positive Covenants and Freehold Land
P2.4 Developer’s covenant to pay service charge to manager and transfer common parts following last sale
(a) So long as any part of the land in the Estate is vested in the Transferor, the Transferor shall pay to the Manager such part of any costs and expenses incurred by the Manager in providing, procuring and performing the services set out in panel 12.X as shall be attributable to the land remaining vested in the Transferor.
(b) Within 6 months after completion of the sale of the last dwelling to be constructed on the Estate, the Transferor shall transfer the [Common Parts] to the Manager for £1.
P2.5 Positive covenant by original buyer of unit to observe regulations
The Transferee for itself and its successors in title covenants with the Transferor and its successors in title to observe and perform such regulations as the Transferor/Manager may issue from time to time and of which it shall serve notice on the proprietor for the time being of the Property.
P2.6 Restrictive covenant to support deed of covenant
The Transferee, so as to benefit the Estate [(except the Property)] and each and every part of it, covenants with the Transferor and with every person who is the registered proprietor from time to time of any part of the Estate (except the Property) not to dispose of the Property or any part of it (other than by way of mortgage or tenancy for a period not exceeding 7 years) except to a person who no later than the time of disposal (firstly) enters into and delivers a direct covenant with the Manager in the form of the deed of covenant set out at panel 12.X; and (secondly) has made a written application to the Manager to become a member of the Manager.
If the estate has been laid out in plots this may be adapted to form part of a building scheme. Although such clauses are in use, as they require action by a person, such a clause may take effect as a positive covenant.
Precedents 251
P2.7 Positive covenant to support deed of covenant
The Transferee covenants with the Transferor that [on any transfer of a legal estate in the Property or any part of it] or [on any disposition of the Property or any part of it (other than by way of mortgage or tenancy for a period not exceeding 7 years)] the person to whom such transfer is made will execute and deliver to the Manager a deed of covenant in the form set out in panel 12.X and an application for membership of the Manager and will pay on demand the Manager’s reasonable costs in respect of that deed of covenant and registration of membership.
P2.8 Restriction
When the Transferee applies for registration as proprietor of the Property the Transferee will also apply to the Chief Land Registrar for entry of a restriction on the register of the title of the Property in the form set out in panel 12.X and after completion of registration will supply to the Transferor/Manager evidence of registration of the restriction.
P2.9 Deed of covenant by first buyer of unit with manager
This is a separate deed where the developer sells the unit to the original buyer but takes no responsibility for maintenance and the manager is not a party to the transfer.
This Deed Of Covenant is made the [date]
Between
1 [The Manager] (the Manager); and
2 [Original unit holder] (the Owner).
This Deed witnesses:
1 In this Deed unless the context otherwise requires the following expressions have the following meanings.
Define service charge, annual expenditure, estate, services, common parts, insured risks, specified percentage, rate of interest and anything else necessary. The Covenant Deed is a deed in the form set out in Schedule X.
2 The Owner covenants with the Manager as follows:
2.1 To pay the Service Charge to the Manager in accordance with Schedule 1;
252 Positive Covenants and Freehold Land
2.2 To keep all buildings on the Property in good repair;
2.3 If any buildings fall into disrepair and if the Manager serves on the Owner a notice specifying the disrepair and requiring it to be remedied and if the disrepair is not remedied within a reasonable time then to permit the Manager to enter on the Property to remedy such breach and on demand to pay to the Manager as a debt the costs incurred by the Manager in remedying the breach and all associated expenses (including legal costs and surveyor’s fees) together with interest from the dates on which the expense was incurred by the Manager until payment by the Owner;
2.4 Forthwith to apply to become a member of the Manager;
2.5 Not to transfer the freehold estate in the Property or any part of it except to a person who before or at the time of such a transfer executes and delivers to the Manager the Covenant Deed and to pay the Manager’s reasonable costs in respect of the negotiation and completion of the Covenant Deed Provided that if that person does so execute and deliver and if payment is made then the Owner shall not be liable for breach of any...
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