Why property developers need not fear ransom strips

By James Coppinger (pictured),head of construction and engineering and partner at Buckles Solicitors

Discovering someone owns a small piece of land, which could hinder a property development or add additional costs, will undoubtedly cause property developers to break into a cold sweat. However, so-called “ransom strips” do not have to be the major headache many perceive them to be.

Typically, a ransom strip is a small piece of land retained by the owner when a larger piece of land is sold. This small parcel of land often sits on the boundary of the sold land, usually between the public highway and the plot of land recently sold.

To develop the site – either to commence development, construct temporary access roads or for those wishing to use the property – a right of way across the ransom strip must be granted and that is where problems can arise, either by accident or design.

The most obvious complication is a potential trespassing charge every time the strip is crossed without the necessary permission from the strip’s owner.

WHAT DEFINES A RANSOM STRIP?

When considering whether a plot of land is affected by a ransom strip, the first consideration is whether a ransom strip really exists. This requires a closer examination of the boundary lines to understand if they have been accurately established.

Many plans are described as being for identification purposes only and when this is the case, the description of the land will prevail. But if the description is inadequate, courts may assess the plan to determine the parties’ intentions.

If the plot is described as “more particularly delineated or described on the plan”, the plan will prevail to the extent of any discrepancy.

This is important for developers, as generally courts will recognise when a potential ransom strip has been created by boundary errors and is negligible, understanding there was no intention on the part of the seller to create a ransom strip.

Ransom strips do not need to be large and can be less than a metre wide, yet still cause a significant problem for a developer and offer a potentially large “windfall” for the owner of the strip.

The Court of Appeal has ruled the dimensions entered onto a plan were not as accurate as a line drawn on a plan, so it is important to consider whether actual dimensions are sufficiently accurate. If a plan was based on an Ordnance Survey map, then the map rules will usually take precedence.

IS PAYMENT THE ONLY OPTION?

Before paying for rights of way, there are other potential solutions available to developers, including an ad medium filum rule, which assumes the boundary of land abutting a roadway extends up to the halfway point of the road width. When this rule is successfully applied, it prevents developers from having to pay for the necessary rights.

The “hedge to hedge” presumption must also be considered when it comes to the roadways, which presumes a highway extends to the whole width of the space between fences on either side.

Council actions must also be considered, as the gap between the highway and land it borders could also include a grass verge, which the council may determine is part of the highway. If the council is actively maintaining the grass verge, the suspected ransom strip could be part of the public highway.

It is easy to understand why ransom strips are viewed as potentially serious legal headaches, but in reality, they are not always the deal-breaking issue they may appear to be on first viewing.

When a landowner sells land, some will retain a small piece, hoping it later becomes a ransom strip that may prevent a developer unfettered access to their newly acquired site – some landowners will happily wait years for their windfall to be realised.

Instead of letting the issue escalate into something problematical and expensive, developers should consult an experienced commercial property lawyer for advice on how best to resolve the issue, without being held to ransom.