The new law of real burdens

Community burdens

As mentioned in the March instalment of this article, real burdens imposed under a common scheme by a deed registered on or after the appointed day are to be known as community burdens if they are imposed on four or more units within the common scheme, under which circumstances each of the units is in relation to the burdens both the benefited property and the burdened property.

The majority of Part 2 of the 2003 Act is concerned with the ability to impose by way of community burdens detailed rules for the management of a community, and the power to appoint, dismiss and lay down the duties of a manager of a common scheme and to enforce common maintenance schemes and contributions to the cost of common works or repairs, all by a simple majority of the proprietors of the benefited and burdened units in the community.

Varying and discharging community burdens

As regards the variation or discharge of community burdens, section 33 provides that unless provision is made in the constitutive deed for variation or discharge granted by all or a specific number of the owners of the units in the scheme, a deed varying or discharging community burdens may be granted by a simple majority of the owners of the units in the community, except that where one owner such as a local authority owns a majority of the units the deed must also be granted by at least one other owner. Section 35 goes on to provide that where the constitutive deed is silent on the issue of who may or may not vary or discharge community burdens, they may be varied or discharged by deed executed by all of the owners of the affected units, that is those units in respect of which the burden is to be varied or discharged, and by all of the owners of the adjacent units, that is the owners of all properties situated within four metres of the affected units.

Extinction of non-community burdens

As regards extinction of real burdens in general as opposed to those imposed under a common scheme, section 15 provides that a real burden is discharged by the owner of the benefited property registering a deed against the burdened property specifying that the burden has been discharged in whole or in part. Section 16 deals with acquiescence in a breach of a real burden where (a) the burden has been breached in such a way that material expenditure has been incurred by the burdened proprietor, (b) any benefit arising from the expenditure would be substantially lost if the burden were to be enforced, and (c) the individual entitled to enforce the burden has an interest to enforce it in respect of the breach and either consents to the activity giving rise to the breach or being aware of it has not objected to its being carried on within a period of 12 weeks from the day on which the activity has been substantially completed. The burden is then extinguished but only to the extent of the breach. It should be stressed that acquiescence by the proprietor for the time being in a breach of a real burden is binding on that proprietor’s singular successors.

A new section 17 introduced by the Executive at stage 3 of the bill’s passage through Parliament usefully provides that where a real burden is breached and there is no person with an interest to enforce it in respect of the breach, the burden is to that extent extinguished and therefore unenforceable in future.

Prescription – only five years

As regards prescription the present position is that breach of a real burden prescribes on the expiry of the long negative prescription of 20 years. Section 18 of the Act provides that unless a relevant claim or acknowledgment is made within five years of the date of the breach, the burden is extinguished to the extent of that breach. Subsection (2) makes it clear that where the breach consists of a failure to comply with the requirements of a right of pre-emption, reversion or other option to acquire heritable property, that breach also prescribes after five years; and as regards a breach of a real burden which has taken place prior to the appointed day the burden is extinguished to the extent of the breach on the expiry of 20 years from the date of the breach or five years from the appointed day, whichever first occurs. Finally, on extinction of real burdens, section 19 makes it clear that a real burden is not extinguished where the same person becomes the owner of both the burdened and the benefited properties, with the result that the rights and obligations of the particular burden will again be enforceable when the two properties revert to separate ownership.

Termination of real burdens

Sections 20 et seq contain new provisions with regard to termination of real burdens and introduce the so-called “sunset rule”. Notwithstanding the basic proposition that real burdens subsist in perpetuity, section 20 provides the facility whereby a burdened proprietor or any other person against whom a real burden is enforceable where the burden was constituted not less than 100 years previously may, after intimation to the benefited proprietor or proprietors and any other burdened proprietors, execute and register a notice in terms of schedule 2 to the 2003 Act terminating the real burden. If the notice is unopposed, the real burden is extinguished on registration in the Sasine or Land Register. The provisions of section 20 do not apply to conservation burdens, maritime burdens, facility burdens or service burdens or to title conditions which are not subject to discharge by the Lands Tribunal for Scotland.

The ensuing sections contain elaborate provisions with regard to intimation of a proposal to execute and register a notice of termination, designed to ensure that any person having the right to enforce the burden is afforded the opportunity of opposing the notice. In addition, the “terminator” as the person serving the notice is called, has to declare on oath or affirmation before a notary public that all the information contained in the notice is true and that the provisions with regard to termination have been fully complied with, while section 23 requires the notice to be endorsed with a certificate from a member or the clerk to the Lands Tribunal confirming that either the notice has been unopposed before the Tribunal or that any application to the Tribunal has been withdrawn, before the terminator can proceed with registration of the notice. The effect of registration is to extinguish the real burden, either wholly or to the extent described in the notice.

Next month’s concluding instalment covers among other topics, servitudes and rights of pre-emption.