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What is a Flying Freehold?
2021-11-15

  There are two main types of land ownership: freehold and leasehold. Freehold means that the person fully owns all the land and buildings on a piece of land. For example, houses are usually freehold property. On the other hand, you have leasehold property rights. This is where you own the property for a period of time and pay rent to the landlord (usually the freehold owner).

  In this article, we will mainly introduce another concept called "flying freehold." This means that part of the freehold property extends above or below the adjacent or adjacent property.

What is a flying freehold?

  Flying freehold is an English legal term used to describe freeholds that are suspended above or below another freehold. Common situations include rooms located above shared passages in semi-detached houses, or extending to balconies of neighboring properties. For example, rooms or balconies are located above shared passages or protrude from adjacent parts of property or land. Flying freeholds are the most common, where an older large building has been converted into many smaller freehold properties. In England and Wales, freeholds are usually divided vertically, so two freeholds do not overlap. Flying freehold occurs when one freehold is overhanging or projected onto another. Flying freehold usually exists in old properties, usually above arches that allow access between properties, or in cellars under encroachment on another property. However, in other cases there may be flying freeholds-a property built on a steep hillside may be on top of another property to provide support, a balcony may protrude on someone else’s land, or a multi-storey building may have been divided, but the configuration room prevents completely vertical division.

What are the practical issues with flying freehold?

  Both parts of the flying freehold property shall be entitled to the support or protection of the other party, and the right to enter the property of the other party for repair and maintenance. Flying freehold rights rarely benefit from appropriate rights, either because the original means of transport did not contain such rights, or because the obligation has been lost over time.

  Obligations are usually lost because although the benefits or burdens of restrictive contracts can be transferred to future owners when the land associated with the contract is sold, the burdens of active contracts cannot. In order to perpetuate active obligations (for example, the active obligation to maintain property maintenance for the benefit of adjacent flight freedom holders), each purchaser needs to sign a contract to comply with and fulfill the active obligation. Over time, this chain often breaks, and for flying freehold property, the property may lose the right to support, access, or repair.

  If there are not enough rights, it will be difficult for the transferor to prove that the property has good and marketable ownership. This may cause the concern of lenders, who may choose not to use the property as collateral to lend, or only do so if the flying freehold does not exceed a predetermined percentage of the building's floor area (usually 15%).

Practical example

  There is a passage between the two properties owned by Property A on the ground floor, and the first floor of Property B extends to the passage.

  Room A has not repaired the passage, and room B needs to be repaired due to ground subsidence.

  Without the owner’s consent, Property B has no right to erect scaffolding or perform repairs on Property A. The owner of Property A asked for a fee of £10,000 to allow access to Property A and agree to repairs.

  The structure of Building B, the integrity of the aisle arch, and the safety of people using the aisle are all threatened.

What steps can be taken to resolve the issue of flying freehold?

  * Indemnity insurance policy

  People generally think that the easiest way is to obtain defect title compensation insurance. The policy will cover any loss of value due to lack of maintenance or repairs to adjacent property. It will also cover any expenses incurred by the owner of the flying freehold when it brings a legal action against the neighboring owner.

  However, the insurance policy itself cannot make up for the defects in the property rights. Before successfully filing a claim, the owner must have exhausted all reasonable steps to arrange with the owner of the adjacent property or obtain a contribution to the maintenance or repair of the property.

  Developer purchasers also need to be aware that insurance policies usually contain exclusion clauses that prevent any structural changes or changes in use, so if you plan to redevelop the property, insurance will not be a viable option.

  * Mutual easement contracts and covenants

  This choice can only be made with the cooperation of neighboring landowners, so it is important to determine at an early stage who the other free owner is and whether it is willing to cooperate.

  The owners of both parties sign a mutual easement contract and contract, grant the necessary support and protection rights, repair and maintain each other's property, and stipulate that both parties are obliged to keep their property repaired and insured, and restore the original damage in the following cases of.

  By requiring each subsequent purchaser of the property to sign a contract to comply with and fulfill the obligations contained in the contract, it is the key to ensure that any active obligations contained in the contract are binding on the heirs of ownership. This obligation can be protected by restricting the registered ownership of the two properties to ensure that no sales can be registered without the consent of another free holder or free holder’s lawyer. Although in theory, this seems to be a direct solution to ensure the permanent existence of the active obligations contained in mutual easements and contracts, in practice, from other free holders or their lawyers.

  * Conversion to lease structure

  The revised ownership structure may take some time to implement, so it needs to be negotiated in a timely manner in order to realize any potential sales or purchases within the agreed time frame.

  Under this solution, both freeholds are transferred to one of the existing owners. Then grant a 999-year lease to another owner of its property. Long-term leases contain necessary rights and contracts, and are automatically binding on any purchaser of leasehold rights, without a series of contracts or ownership restrictions.

  * Rely on the 1992 Adjacent Land Law (the law)

  If all other methods fail, the bill may be a useful tool, but similar to the insurance route, there is still a long way to go to correct the problem. This is a long and expensive process and there is no guarantee of success.

  The bill allows the court to grant temporary access to other people’s land for basic protection projects. Orders will only be issued for work that requires protection, repair or maintenance rather than improvement of the property. If other owners of the property will interfere or interfere with their land to the following extent, it is unreasonable for the order to be refused to place an order.

  It is important to consider the impact of flying freehold rights early in the transaction. If not managed properly, flying freehold rights can destroy property by inhibiting necessary repairs and maintenance, and ultimately prevent development. Many financial institutions are unwilling to use assets with any freehold elements as collateral, so it is important to take measures as early as possible to assess whether the ownership defects can be remedied.