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I
am delighted to present a further Bill in the Executive's wide-ranging programme
on land reform. This Bill is called the Title Conditions Bill. It is associated
with the Abolition of Feudal Tenure etc. (Scotland) Act, which was passed by the
Scottish Parliament in June 2000. Since the feudal system is about to give way
to a system of simple, outright ownership, the time is right for reform of the
general law on conditions affecting land. Together, the two pieces of legislation
will provide a modern and simplified framework for property ownership in Scotland.
What are title conditions? This may sound like a very technical term, but in fact it describes a very simple concept, and one which affects all householders. Those of us who own houses or other forms of property will almost certainly have some kind of conditions attached to our ownership. We may be restricted as to how we can alter our property - for instance we may not be allowed to erect a building in the garden. We may be restricted as to how we can use our property - for instance we may not be allowed to use a house to run a business, or we may not be allowed to keep more than one pet. We may be obliged to do something to our property - for instance to keep it in good repair. We may be obliged to let other people have access to our property - for instance if they need to cross it to get access to their own property. These conditions will be set out in the legal documents, or titles, which prove our ownership of the property. They are title conditions.
The general law on title conditions is common law. It has built up as a result of decisions taken in the courts on individual cases, and then been interpreted and applied more generally. The Scottish Law Commission have studied the state of the law, and has concluded that it is unclear and confusing. They have therefore recommended that the law on title conditions should be clarified, and set out in a new statutory law. The draft Bill which is attached to this Consultation Paper has been drawn up by the Commission. It restates the current law in a clear, codified form. In places, where the common law is uncertain or unsatisfactory, it proposes reforms or enhancements of the law. The Consultation Paper draws attention to issues raised by the draft Bill. The Executive would welcome views on these issues before finalising its own policy proposals for legislation.
The general effect of the Bill will not be to change the social structure of Scotland, but to move to a modern and simplified system of property ownership. This is a reform from which all householders will benefit. It will make the process of conveyancing simpler, and will make life easier for those buying or selling property and for those who wish to alter the conditions binding their ownership of property.
I should like to pay tribute to the diligent and exhaustive work which the Scottish Law Commission have carried out in reviewing the law relating to title conditions and in suggesting modernising reforms. Scotland is well served by its Law Commission and it is a source of great satisfaction to me that the Scottish Parliament now provides a legislative avenue by which the Commission's recommended reforms may be implemented.
I look forward to receiving comments on the draft Bill.
Jim Wallace, MSP
Comments
on the draft Bill should be sent by 23 July 2001 to:
Iain Hockenhull
Title Conditions (Scotland) Bill team
Civil Law Division
Scottish Executive
Justice Department
Spur V/1
Saughton House
Broomhouse Drive
EDINBURGH EH11 3XD
Telephone 0131-244 8228
Fax 0131-244 2195
E-mail
iain.hockenhull@scotland.gsi.gov.uk
As usual, copies of replies received will be made available to the public on request, unless respondents state that all or part of their response is confidential.
All comments received on these proposals will be carefully considered, and will help the Scottish Executive to prepare the Bill to be introduced to Parliament.
1. Title conditions are conditions which apply to land ownership. In this context 'land' means land and the buildings which stand on it. Title conditions affect most land in private ownership, as, when a plot of land or an individual house is sold, the seller may place conditions in the title to the land. For instance, the purchaser might have to contribute to the cost of a service; or he might have to maintain the property; or he might be forbidden from carrying out certain activities on the property. These are title conditions. This private regulation of land ownership is parallel to and separate from the public regulation of land ownership which operates through planning and environmental legislation.
2. The purpose of this Consultation Paper is to set out the Executive's plans for the reform of the law on title conditions, and to invite views on it. A draft Bill is attached at Annex C, which is the second volume of this Consultation Paper. It has been prepared by the Scottish Law Commission, a statutory body which is charged with promoting reform of the law of Scotland. The draft Bill was published by the Commission in October 2000, as part of their Report on Real Burdens (Scot Law Com No 181). Both the Report and the draft Bill are available at http://www.scotlawcom.gov.uk
3. Before the Commission published their Report, they issued a Discussion Paper (Discussion Paper No 106) in October 1998, on which they held a wide consultation exercise. The Commission's Report gave a very thorough account of the reasoning behind the draft Bill. This Consultation Paper does not duplicate that. It does, however, reproduce the Commission's detailed notes on the effect of each section of the Bill. These are interleaved with the relevant sections of the Bill in Annex C.
4. The Executive intends to introduce the Commission's Bill. There are, however, a number of provisions where the Executive has some reservations about what is proposed, or which it regards as controversial. These issues are highlighted in this Consultation Paper and the Executive would particularly welcome views on them. The points for discussion are given in the Paper in purple boxes. They are also reproduced at the end of the Paper in Annex A. The subject matter of the Paper is highly technical, and different parts of it will be of interest to different sectors. Please do not feel obliged to answer all the questions. The Executive will also, of course, take account of any other more general comments which you wish to make.
Vocabulary and basic rules of the common law
5. The contents of the Bill are highly technical. A glossary is attached at the end of the Consultation Paper at Annex B. But the reader may find it helpful to have a brief explanation here of the main terms which are used in the Paper.
6. A title condition is a condition which applies to land ownership. The most common type of title condition is a real burden. Other types of title condition include servitudes and conditions in long leases. The draft Bill is primarily concerned with the law of real burdens. A real burden restricts the owner's use of his land, or obliges him to do something. One important type of real burden is a facility burden, which obliges the owner to maintain or contribute to the maintenance of a common facility, for example the common parts of a tenement. Service burdens are concerned with the provision of services such as water to other land.
7. While not a term which appears in the Bill, the term amenity burden is a convenient label for other burdens. Amenity burdens include burdens which may restrict the uses of the property, for instance by stipulating that it may not be used for keeping more than one animal, or that it can only be used as a dwelling-house. Amenity burdens might provide that only a single-storey house could be built on the land, or that individual houses must all conform to a standard pattern.
8. The burdens which bind the owners of a property are set out in deeds which are recorded in the Register of Sasines or registered in the Land Register. These registers are maintained by the Keeper of the Registers and are open to public inspection. The burdens regulate the way property is used and the obligations they impose are conditions of ownership. The owner of the property is the outright owner - but he has accepted that he owns it subject to conditions. When he sells the property, the burdens will still apply to it. In theory, burdens are perpetual. They run with the land.
9. The law of real burdens is clear that a burden is to benefit land rather than a person. For a condition on land to be a real burden, it must benefit other land. Thus there must be two plots of land and one plot must benefit from the burden placed on the other. The first plot is called the benefited property and the second is called the burdened property.
10. If the owner of a property does not observe his title conditions, that is not a matter for the police or public authorities. But there will usually be someone who can take action to make him keep to his conditions. That person is the owner of the benefited land. He is the benefited proprietor. He has enforcement rights. In order to enforce the burden, the benefited proprietor must have title to enforce - in other words it must be apparent (expressly or implicitly) from the deed creating the burden that he has the right to enforce the burden. But the common law is clear that he must also have interest to enforce - in other words his property must genuinely benefit from the burden. Otherwise he cannot enforce it.
11. Sometimes the owner of the burdened property (the burdened proprietor) will wish to get rid of the burden or to vary it: this is called a discharge or a variation. He can do that in two ways. He can apply to a special court known as the Lands Tribunal for Scotland for a discharge or variation of the burden. Or he can ask the benefited proprietor, who, if he agrees, will grant a minute of waiver. Sometimes benefited proprietors charge a fee for this. If the burdened proprietor ignores the burden, and acts in contravention of it without permission, this is known as a breach.
Main purposes of the Bill
12. The draft Bill has two main objectives. The first is to achieve greater clarity in the law. The second is to reduce the number of outdated burdens by making it easier to discharge or vary them. This will make it possible to update the property registers over time and to achieve greater clarity about the burdens and enforcement rights applying to owners. The Bill creates a regime for the way in which land will be held in the future, and also makes transitional arrangements for burdens and rights which exist at present.
13. The draft Bill has 11 Parts. This Consultation Paper is therefore divided into chapters - one for each Part of the draft Bill, apart from Part 11 which is in a single chapter with Part 10. There is also a chapter on the effect that the Bill will have on sheltered housing, and one on the relationship of the Bill to the Abolition of Feudal Tenure etc. (Scotland) Act 2000, which is referred to in this Paper as the 2000 Act.
14. The abolition of feudal tenure will have a profound effect on the way in which property is held in Scotland. The vast majority of land is held at present under feudal tenure and many real burdens were created in feudal deeds. Although the 2000 Act has been passed, much of it has not yet been commenced. Most feudal burdens will disappear along with the feudal system, but the 2000 Act allows some feudal burdens to be saved. They will be assimilated into the law of real burdens, and it is desirable that this assimilation forms a single process along with the reform of the law on title conditions. Once the Title Conditions Bill has been enacted, it and the remaining parts of the 2000 Act will be commenced simultaneously on a date which is referred to as the appointed day. This will result in a significant clarification of the law and the removal of outdated burdens. To allow time for transitional arrangements to be put in place, the appointed day is likely to be about 2 years after the Title Conditions Bill is enacted.
Contents of the Bill
15. Part 1 of the Bill codifies the existing law and introduces some changes such as a 'sunset rule' (with the option of preservation) for burdens over 100 years old. It sets out how to create a real burden, what its contents may be, and how it may be terminated. These rules apply to existing burdens as well as burdens to be created in the future.
16. Part 2 deals with burdens which apply to communities in the sense of groups of properties which have a common scheme of burdens. There are many types of community - communities exist in modern housing schemes and in Victorian terraces and Georgian developments; in tenements and in sheltered housing complexes. There are also non-residential communities in commercial developments such as business parks. These communities will have common or similar burdens which apply to all the units within them, and which can be mutually enforced. Part 2 coins a new term - community burdens - for burdens of this type, and sets out the rules for existing and new community burdens.
17. Part 3 sets out the rules for conservation and maritime burdens. The concept of conservation and maritime burdens was introduced in the 2000 Act. They are types of burden that are of public benefit.
18. Some burdens do not specify who has enforcement rights. However, because of the way in which the title deeds have been drawn up, the rights have been created by implication. Part 4 abolishes implied enforcement rights subject to a preservation procedure, and prohibits their creation in future. Some of these implied rights of enforcement can be preserved - with the condition that in future the benefited property would have to be specified. Part 4 also recreates implied rights of enforcement in common schemes subject to a distance qualification.
19. Part 5 is a miscellaneous Part which deals with a variety of different issues. Amongst the most important is the power to create a new legal category of burden in future. This is a manager burden, which would allow a property developer to keep control of a group of properties while he is developing them, and for a limited period afterwards.
20. Part 6 of the Bill outlines a model development management scheme. This scheme is based upon the Management Scheme B contained in the Law Commission's Report on the Law of the Tenement (Scot Law Com No 162). The scheme provides an example of good practice intended for developers, and is optional. The scheme is not confined to tenements, and can be adapted for use in other developments with shared facilities.
21. Part 7 is about a different type of title condition - the servitude. Servitudes are a special class of title condition which generally give the owner of the benefited property the right to have access or otherwise make use of the burdened property. The Bill does not undertake a review of the law on servitudes, but it does realign the boundary between servitudes and real burdens. In the future, it will be a much simpler task to identify whether a particular obligation is a servitude or a burden. Servitudes created in writing will not have to belong to the existing fixed list.
22. Part 8 deals with technical aspects of the law relating to rights to acquire property. The rules for pre-emption are modified, and the procedure is streamlined to operate more efficiently. New provisions are made for rights of reversion arising under the School Sites Act 1841.
23. Part 9 sets out rules for the Lands Tribunal. These restate the existing rules and also make some changes. The jurisdiction of the Tribunal is extended to allow it to consider the validity and enforceability of burdens. There is a special provision for the variation or discharge of community burdens, and provision for the granting of unopposed applications for discharge or renewal of burdens.
24. Part 10 outlines certain miscellaneous provisions, the most important of which concerns the effect on title conditions of compulsory purchase or the acquisition by agreement of land by an authority which could have used compulsory purchase powers. Part 10 also amends the existing legislation on the ranking of standard securities.
25. Part 11 lists the various savings and transitional arrangements pertaining to the draft Bill, and the interpretation, short title and commencement provisions.
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