The recent case of Loxleigh Investments Ltd v Dartford Borough Council  EWHC 1274 (Ch) highlighted the importance of clear language in transfer agreements. In the present case, the client was unable to satisfy the court that the trigger for exceeding the “detailed building permit” does not include the approval of the reserved materials after the granting of a master plan permit and the payment of the overrun by the developer. However, regardless of the seller`s initial motives, clauses of this type are relatively rare today. Buyers, of course, have never loved them. It didn`t matter much in the exhilarating days of the mid-sixties, when people were desperately trying to pay for everything vendors demanded, and more for every piece of land with development potential. At the time, you either accepted the clause as it was, or you paid the seller the exorbitant amount he had asked for to have it removed. It`s a whole different story today when properties with overflow or elevation clauses can be virtually unsellable. In fact, sellers who thought they were a good idea 4 or 5 years ago are now more willing to voluntarily abandon them if it means they can find a buyer. Home » Moving » Elevation Clauses and What to Do About Them The Elevation Clause is a contractual agreement between the original seller and the original buyer, so there are usually a number of conditions in the land registration document that insist that you cannot resell the property unless the same elevation clause is followed.
If this restriction is introduced, it may charge an additional transfer fee when selling the property, as the original owner`s lawyer will essentially have to approve the sale and create a separate contract for the new owner. Elevation clauses of previous owners usually only appear in land registry documents, so it`s important that you review them carefully before selling or buying them. It can cost as little as £3 to get a copy of the registration documents, so it`s worth investing in checking if a property has an elevation clause. So, if you`re about to buy or sell properties with a new over-the-top use agreement, what are the five key factors you need to consider? An overrun or “overrun” agreement is used when selling land or real estate that is likely to increase in value in the near future; an excellent example is when land is sold to developers. If overshoot conditions have been included in the contracts during a sale, the seller may be entitled to a profit share if the conditions are met. While 25-year settlements are common, 5- to 10-year overruns are more reasonable and realistic for both parties. Extremely long contracts can have a negative impact on the future sale of land, especially for those who intend to invest a lot of time and money in the development of the country, since buyers are naturally not willing to share the profits with a previous seller who apparently did nothing to earn it! An overrun can have any number of triggers for payment. Sellers often want the buoyancy payment to be made when the building permit is issued. But this can cause problems if you are a buyer. This can give you cash flow problems because you can`t predict exactly when or if permission will be granted. It can be very expensive to obtain a building permit and meet S106 agreements and infrastructure requirements. The buyer wants these fees to be deducted from the final payment of the increase.