Lands Tribunal for Scotland

OPINION

Sheena Borthwick Toomey and Alan Toomey (Applicants)
v
Wilson Smith and Claire Hall (Respondents)

Land at Pumpherston Road, Mid Calder, Livingston

Introduction

[1] This is an application for discharge of title conditions under s.90(1)(a)(i) of the Title Conditions (Scotland) Act 2003 (“the 2003 Act”). The applicants are owners of the burdened property. The conditions restrict the use of the land to grazing and prevent development for other uses without the consent of the owners of benefited property. In the event of consent being granted there is a clawback provision for development value to be paid to the benefited proprietors. There is also a pre-emption clause. The respondents are owners of the benefited property.

Procedure

[2] The applicants were represented by Messrs T C Young, solicitors, Glasgow. The respondents represented themselves. Parties agreed to the application being determined by means of written submission. We held a site visit on 7 October 2019.

[3] During the proceedings it appeared to the Tribunal that the pre-emption clause might no longer be valid by operation of statute. We asked parties for a response on this matter. In this respect we would allow the application to proceed as an application under s.90(1)(a)(ii) of the 2003 Act.

Title Conditions

[4] The burdened property is held under the Land Register title number MID93440. It was first registered in the land register in 2006. Burdens Entry 2 refers to a disposition by Lindsay Gerald Borthwick and Mrs Sheena Borthwick in favour of Ian Wells and another recorded GRS (Midlothian) 14 March 1995 of the burdened property. The title includes the following burdens:

“(One) the subjects shall be used for the grazing of livestock or as open ground only and for no other purpose whatsoever without the prior written consent of us or our successors in title as proprietors of the dwellinghouse known as Calderbank Dairy, Pumpherston Road, Mid Calder tinted blue on the Title Plan,

(Two) In addition and without prejudice to the terms of Clause (One) no buildings or other erections save a field shelter and loose boxes shall be erected on the subjects without the prior written consent of us or our foresaids as proprietors of the said dwellinghouse known as Calderbank Dairy, aforesaid (hereinafter referred to as “us/we or our foresaids”) and we or our foresaids shall be entitled to refuse such consent but in the event of such consent being granted it will only be given in exchange for the payment by our disponees or their successors as proprietors of the subjects (hereinafter referred to as “our said disponees and/or their foresaids”) of a sum equivalent to the open market value of the subjects taking account of the proposed development thereon at that time with the benefit of such consent under deduction of the price paid by our said disponees to us or our foresaids as such price shall be index linked according to the General Index of Retail Prices as published by the Department of Trade and Industry or any similar Index published in substitution therefor. In the event of the parties failing to agree the sum to be paid by our said disponees or their foresaids to us or our foresaids such sum shall be determined by an Arbiter to be mutually chosen or failing agreement to be chosen by the then Chairman of the Royal Institute of Chartered Surveyors (Scottish Branch) whose determination shall be binding on and whose costs shall be borne equally by the parties.

(Three) it shall not be in the power of our said disponees or their foresaids or those having power of sale over the subjects or any part thereof to sell the subjects or any part thereof to any person (except under statutory authority or compulsion) until they have first offered in writing to sell the same to us or our foresaids at such price and on such other conditions as any other person shall have offered to purchase the same and we or our foresaids shall be bound to intimate in writing acceptance or refusal of such offer within twenty one days of the Offer having been received by us or our foresaids. Declaring that the right of pre-emption hereinbefore created shall apply only in the case of a proposed sale at arm’s length to a third party by our said disponees or their foresaids and that our said disponees or their foresaids may transfer the ownership of the subjects by means of inter vivos or mortis causa gift or under the Law of Intestate Succession in Scotland in which cases the right of pre-emption shall not apply.”

[5] There is a Note on the title sheet at the end of Burdens Entry 2 stating that Calderbank Dairy is now known at 14 Pumpherston Road, Mid Calder. The respondents own 14 Pumpherston Road in terms of title MID4990.

Legislation

The Title Conditions (Scotland) Act 2003 (“the 2003 Act”) provides:

18 Negative prescription

(1) …if–

(a) a real burden is breached to any extent; and

(b) during the period of five years beginning with the breach neither–

(i) a relevant claim; nor

(ii) a relevant acknowledgement,

is made,

then, subject to subsection (2) below, the burden shall, to the extent of the breach, be extinguished on the expiry of that period.

(2) … where, in relation to a real burden which consists of–

(a) a right of pre-emption,…; or

(b) any other type of option to acquire the burdened property,

the owner of the burdened property fails to comply with an obligation to convey (or, as the case may be, to offer to convey) the property (or part of the property) and paragraph (b) of subsection (1) above is satisfied, the burden shall be extinguished in relation to the property (or part) on the expiry of the period mentioned in the said paragraph (b).

(3) Sections 9 and 10 of the Prescription and Limitation (Scotland) Act 1973 (c.52) (which define the expressions “relevant claim” and “relevant acknowledgement” for the purposes of sections 6, 7 and 8A of that Act) shall apply for the purposes of subsections (1) and (2) above as those sections apply for the purposes of sections 6, 7 and 8A of that Act but subject to the following modifications–

82 Application and interpretation of sections 83 and 84

Sections 83 and 84 of this Act apply to any subsisting right of pre-emption constituted as a title condition which–

(b) was created in a deed executed after 1st September 1974,

84 Extinction following offer to sell

(1) If in relation to a right of pre-emption to which this section applies–

(a) an event specified in the constitutive deed as an event on the occurrence of which such right may be exercised occurs; and

(b) the owner of the burdened property makes, in accordance with subsections (2) to (6) below, an offer to sell that property (or, as the case may be, part of that property) to the holder of such right,

then such right shall, in relation to that property (or part), be extinguished…”

The section proceeds to describe the procedure for the offer to sell to be made by the owner of the burdened property.

Background Facts and Circumstances

[6] The applicants acquired the burdened property (“the subjects”) in 2006, at which time the title conditions appeared in the title sheet. The consideration is stated to be £25,000. The subjects had previously been sold in 1995, apparently by the first applicant and another for £3,500 to third parties. She, along with the second applicant accordingly acquired it back in 2006. As we understood it, the applicants live in Ochiltree, Ayrshire, remote from the subjects.

[7] The subjects are a low-lying field of rough pasture extending to 3 hectares bounded to the west by Linhouse Water. The Linhouse Water is a small river running into the River Almond. The ground steeply rises to the southeast and northeast where there is a treebelt, also within the title boundary. The field has not been upkept and there is a derelict and vandalised field shelter.

[8] The subjects are accessed by steps and a footpath running from a bridge to the north. It is also accessed by the same footpath from Main Street to the south. The footpath runs through the subjects but, according to the title description, is not included in the property section of the title. The footpath is part of a connection between two parts of the Almondell and Calderwood Country Park. The footpath is used by the public. The subjects lie adjacent or very close to the country park, but are not included within its boundary. The bridge is part of the country park. The subjects lie within a conservation area.

[9] The respondents acquired the benefited property, namely 14 Pumpherston Road, in January 2019. It is a former dairy which has been converted into a house. It is built on a slope of ground running down towards the Linhouse Water on the opposite side to the subjects. At one time the dairy subjects would have looked on to the burdened subjects.

[10] There are now three houses in a row lying between the benefited property and the burdened subjects. These are numbers 16, 18 and 20 Pumpherston Road. We understood that these properties are built on land formerly belonging to the dairy. According to the application they were built between 1996 and 1998, i.e. after the creation of the title conditions. The effect of this construction is that very little of the burdened subjects will now be seen from the benefited property.

[11] As we understood it, the benefited property and surrounding land had at one time belonged to the first applicant and another, although was no longer in their ownership in 2006 when they acquired the burdened property.

Submissions for applicants

[12] The applicants hope to be able to develop the burdened subjects in the future for housing. There is no specific proposal at present. The burdened subjects are not allocated for development in the current local development plan. The ground however is located within a housing market area where there is a continuing requirement for land to be added to the housing land supply. The applicants wish the comfort of knowing that the title conditions would not be an impediment in bringing forward proposals for future residential development. It was denied there had been a previous application for discharge.

[13] Turning to factor (f) of s.100, the first two title conditions are user restrictions. They are not an absolute prohibition on development. The primary purpose would be to secure for the owner of the benefited property a financial benefit attributable to development value arising from a proposed alternative use. Another purpose may have been to protect the physical amenity of the burdened property. The purpose of the third condition is less apparent but potentially ensures an element of future control over the long-term use of the burdened land for the protection of the amenity of the burdened property.

[14] With reference to factor (a), since the title conditions were created, an access road and three substantial houses and gardens were built behind the benefited property. The benefited property looks on to these properties whose construction has impacted upon the setting and amenity of the benefited property. Discharge of the title conditions would not cause any material detriment to the amenity of the benefited property. The benefited property has changed hands several times since the creation of the title conditions.

[15] With reference to factor (b) the benefit conferred by the conditions is very much reduced, if not negligible. Any interest which the original vendors of the burdened property had in benefiting from an uplift in value was personal to those vendors. The price paid by subsequent owners of the benefited property would have been unaffected by the existence of the title conditions. The value of the benefited property would not be materially affected by the discharge of the conditions. Whatever amenity was protected by the conditions has been lost by the subsequent development. The owner of the benefited property would not have an enforceable interest in the title conditions since they would not suffer any material detriment to the value or enjoyment or ownership of, or right in, the benefited property through a failure to comply with the conditions.

[16] On the other hand in terms of factor (c) the title conditions amounted to a serious impediment upon the applicants’ right of enjoyment of the burdened subjects since the opportunity to develop property is a normal incident of the right of ownership. Turning to factor (e) the title conditions are 24 years old and development pressures have increased over time.

[17] It was submitted that even if the land was not conducive to development, there would be no prejudice to the respondents by a discharge. The existence of the country park and conservation area might be relevant planning matters but were not relevant to the matter of a discharge.

[18] Turning to the pre-emption clause the purpose was uncertain and will have diminished given passage of time. With reference to the validity question, it was accepted that there had been at least one transaction since the imposition of the condition. It was not submitted that the procedures under s.84 had been complied with, but that the burden had been extinguished in terms of s.18(2) of the 2003 Act by negative prescription, there having been no relevant claim within 5 years of the sale to the applicants. The applicants submitted it would be “cleaner” for the burden to be discharged and thus removed from the title sheet.

Submissions for respondents

[19] These were very limited. It was stated that there had been a previous unsuccessful application for discharge. The condition of the land was not conducive to development. The land was part of the wider Almondell and Calderwood Country Park. It was in a conservation area. No attempt was made to address the s.100 factors or the validity question of the pre-emption clause.

Discussion by Tribunal

Pre-emption clause

[20] We start with the pre-emption clause (Three). The papers indicate, on the face of it, that an event specified in s.84 and the deed had occurred, namely an arm’s length sale at a time when the clause was in effect. That would normally trigger the s.84 mechanism leading to a sale to the benefited proprietor, failing which extinction of the burden. The applicants buying the land in 2006 do not suggest that the s.84 procedures were carried out, but rather that any right of the benefited proprietor to challenge the sale would have prescribed in terms of s.18(2) within five years of an assumed breach from that time. There has been no relevant claim. The result of s.18(2) is that the burden is extinguished altogether.

[21] It seems to us that absent submissions to the contrary, this point is well founded. S.18 of the 2003 Act adopts certain sections of the Prescription and Limitation (Scotland) Act 1973, but not any of the provisions which might apply for extending time while a creditor was unaware of the breach: e.g. s.11 for the purposes of s.6. So on the face of it, the five year period mentioned in s.18(1) is strict.

[22] It follows that in our opinion the clause has been extinguished. We shall make a declaration to this effect in terms of s.90(1)(a)(ii).

Discharge under s.98 and s.100

[23] Turning to Clauses (One) and (Two) and the s.100 factors we are inclined to think that the main purpose (factor (f)) of the restrictions was amenity related. The provision requiring to pay development value as the price of consent from the benefited proprietor, if valid, would tend to deter development. Thus a good deal of control over amenity would be secured to the benefited proprietor. There has been a material change in circumstances in the neighbourhood (factor (a)) by the construction of three new houses between the benefited property and the subjects. Prior to that there would have been open views from the benefited property into the subjects, comprising the water, meadow and trees. These views no longer exist. The field appears to have been used for grazing horses or ponies in the past, but this use has been abandoned. The benefit (factor (b)) is now restricted, since the new houses will almost entirely restrict the view. The residual amenity as now exists is, at its highest, indirect, i.e. one would have to walk as a member of the public some distance from the benefited property to the bridge and path to enjoy a view of the subjects from a different angle. In this connection we do not find the fact that the subjects are close to the country park to be significant. Nor do we find the fact the subjects lie within a conservation area to be directly relevant, although it might be fair to say in general terms that visual amenity provided by the field is implicitly recognised by the conservation area designation.

[24] The burden impedes enjoyment of the benefited property (factor (c)) in that the owners of the subjects do not have a clean title and cannot develop the land. There does not appear to be any immediate intention to develop, and we understood there to be no relevant allocation in the local plan. While the topography and restricted access to the subjects may well make development challenging, the evidence does not allow us to conclude that development would be undeliverable in the future.

[25] The title conditions are 24 years old which, all else being equal, in terms of factor (e) is not particularly significant. There is no planning consent or similar in terms of factor (g). There is no expressed willingness to offer compensation in terms of factor (h), but nor are any substantive grounds for compensation put forward. We were not given any details of a supposed previous application for discharge, and must discount this issue.

Conclusion on discharge

[26] Drawing the threads together we think there has been a significant change in circumstances whereby the purpose and benefit of the burdens are very much diminished, to the point that any benefit is indirect and somewhat remote to the benefited property. The impeding of enjoyment of the subjects is, if not immediate, potentially quite significant in that at some time in the future the owners will be restricted from developing them if it transpires development is possible. The foregoing are the most significant matters in our opinion, and tend to weigh in favour of a discharge. In these circumstances we consider it would be reasonable to discharge the conditions.

[27] We have not attempted the above analysis in respect of the pre-emption clause (Three). Our impression is that the weighting of factors could be rather different, since an owner of the benefited property might well wish the option to buy the subjects in the neighbourhood for their own purposes and uses such as recreation. As it transpires this matter does not arise in the light of our earlier findings.

Decision

[28] Accordingly we discharge title conditions (One) and (Two) of Burdens Entry 2. We find that condition (Three), having been extinguished, is no longer valid.