A Restriction on Title is a relatively common measure for those who want to protect their interests in a property – be it a parcel of land or a specific building.

Certain conditions are entered onto the title deeds and these must be fulfilled if a sale, transfer, gift or new mortgage (known as a ‘disposition’) is to go ahead.

In our area of work a common Restriction on Title relates to overage (clawback) agreements (see In Plain English: Overage). In this instance it would ensure the seller of the land is entitled to a percentage of any uplift in its value should the incoming buyer subsequently gain planning permission and decide to re-sell.

The Restriction on Title would state no disposition can be registered without written confirmation from the original owner that the overage agreement has been satisfied.

The 2003 Land Registration Rules set out 30 ‘standard form’ restrictions that are normally used, but in exceptional circumstances parties can also draft a ‘non-standard’ restriction.

To enter a restriction you must be the registered owner of the property; someone who is entitled to be registered as the proprietor, that is, the new buyer; a person with consent from the owner or future owner such as a solicitor; or someone with sufficient interest in the property, for example a charity commissioner for land held in charitable trusts.

If you are selling a property that has a Restriction on Title then you must ensure you can meet the conditions before the disposition takes place. If you are buying then your conveyancer must ensure all necessary steps have been complied with upon completion of sale.

Whatever the circumstances – whether you are thinking of getting a Restriction on Title added or having one removed – we would always recommend that you seek professional advice. Making the wrong decision could be detrimental to your long-term interests and may mean that you lose out on any potential benefit.

Further information

Contact Savills Development