Ransom strips

The inspiration for this short post was a recent discussion with a colleague. The colleague no longer practices property law but did so some years ago. He had rarely come across a ransom strip situation whereas I have quite commonly. A ransom strip is a small piece of land, generally strategically retained when a larger

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The inspiration for this short post was a recent discussion with a colleague.

The colleague no longer practices property law but did so some years ago. He had rarely come across a ransom strip situation whereas I have quite commonly.

A ransom strip is a small piece of land, generally strategically retained when a larger plot is sold.

It’s worth remembering that it is perfectly lawful to charge what appears to be a completely disproportionate amount to sell the ransom strip retained at a later date. The word “ransom” may suggest wrongdoing but there is none in this situation, it’s commercial reality.

Thinking of retaining a small piece of land, which may only be a few feet wide or long, or even less, requires foresight and savvy advice.

If you are selling a plot of land, whether it is already built on or not, and it is fairly sizeable, it is worth considering retaining a small part. This is of course subject to negotiation with the buyer, who is almost certainly not thinking at that stage of developing it. It may be several transactions, perhaps years or decades later, that your ransom strip becomes valuable.

How a ransom strip becomes valuable

A ransom strip will generally become valuable when a developer of the land you originally sold some time ago wants to build on it. It may be vital for that proposed development for access or other reasons.

Beware the possibility of your ransom strip losing it’s value

It is all too easy to forget about a small parcel of retained land after you have sold off the main part. If years elapse, it is possible that the land retained might be used, on a daily basis, for access, and that rights might be acquired over that land in that way, which could, in theory, reduce or undermine your ability to strictly enforce your rights. If possible, it is worth considering ways to prevent this such as physical features to avoid inadvertent rights of way.

Buying a property – concerns about existence of a ransom strip

If you are buying land or a property and you spot, on physical inspection, a small part of the plot or strip of land which seems to be separate from what you are buying and from adjacent properties, your lawyer ought to check. If you plan on developing, the need is even more urgent. The way to check, if the position is unclear, is via an Index Map Search – see more on this in this helpful Land Registry blog post.

Prime example of the benefit of a commercial, experienced lawyer

It’s probably a moot point as to whether it would be negligent for a lawyer advising a seller of a piece of land to always advise on the possibility of retaining a ransom strip. The point is that a commercial, savvy, experienced lawyer acting for a seller, in the right circumstances, will have the foresight to potentially spot the opportunity for development of that land later.

James Swede
James Swede

If you need advice on this issue or any other aspect of property law, I am happy to help.

Conveyancing • James Swede • Property law • Uncategorized

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