Creating real burdens in developments

As those who attended one of the series of conveyancing conferences held jointly with the Society in November will recall, the Keeper has noted that real burdens are still regularly created in dispositions rather than in deeds of conditions.

The Keeper believes that there are significant advantages for all parties in creating real burdens in a deed of conditions if the intention is that the real burdens should be mutually enforceable by all proprietors. His view on this has been shaped particularly by examining the issues surrounding the creation of real burdens by means of dispositions of individual properties in developments.

The Keeper has listed the following advantages of using a deed of conditions for developments:

• No need to dual register the dispositions
  Using a deed of conditions is likely to save registration fees of £600 for a development of six houses, and £2,310 for a development of 12.
• Creates real burdens at the outset
  Using a deed of conditions eliminates the risk of subsequent applications being rejected for lack of dual registration. If real burdens are set out in dispositions, any intention to create mutually enforceable real burdens may not be realised if any of the dispositions are rejected, submitted for registration in the “wrong” order or fail to create valid real burdens for any other reason.
• Can also be used to create servitudes in terms of s 75(2) Title Conditions (Scotland) Act 2003
  A deed of conditions can be used to specify servitudes that will then be created upon registration of subsequent dispositions of the relevant plots.
• Drafting of dispositions simplified
  Using a deed of conditions is likely to avoid the need to set out real burdens or servitudes in dispositions. Consequently, there will be no need to make sure plots previously sold are correctly nominated as benefited properties nor any need to include provisions regarding enforcement rights in terms of s 12 of the Title Conditions (Scotland) Act 2003.
• Uniform and easy to understand title sheets
  Using a deed of conditions will result in title sheets showing a single entry for the deed of conditions, rather than entries for the dispositions of all other parts of the development.

The Keeper hopes that this article will be useful to the profession.

Further details on these issues can be found on the Registers of Scotland website: www.ros.gov.uk/registration/burdensindevelopments.html

If you require any additional information regarding deeds of conditions please do not hesitate to contact Derek Hand on 0131 528 3832, or email him at [email protected]