What are ransom strips?
Small strips or other areas of land — “ransom strips” — can be the key to development. This may occur if land suitable for development cannot be reached directly from the public highway, or through existing private rights of way. (See our Background notes on Highways law and on Private rights of way law.) Access must be obtained over land belonging to another landowner. The development thus cannot take place without the agreement of the other landowner, either by selling the strip of land in question, or (more commonly) granting a right of way over it.
Such situations may arise by accident. But they may also arise deliberately. In a new housing estate, for example the developer may set aside small strips, or other areas of land, at the boundaries of the new estate. Crossing these areas without the agreement of the developer will be unlawful, because it will be a trespass. In this way, developers can give themselves the right to profit from any future development beyond the boundaries of the existing estate. Depending upon the layout of the estate, it is of course entirely possible that there will be accidental ransom strips. The purchaser of a new house will in effect be in possession of a ransom strip if a small part of her land will need to be crossed in order for further development to take place.
The size of ransom strips is of no particular significance in itself. (In one recent case the strip was only about 250mm wide.) Nor does it have to be fenced off, or marked with a notice. However, if the strip is very small there is a risk that people will be unaware of it, and pass to and fro over, it eventually creating a private right of way by prescription.
As between private parties, the owner of a ransom strip is under no obligation to grant rights of way in order for development to take place. Indeed, the whole point of the ransom strip may be to protect the landowner in question from development which would impact upon the amenity enjoyed by his own land.
Valuation and ransom strips
Land with development potential will increase greatly in value if the necessary access can be obtain over a ransom strip.
There is no way of determining precisely what the payment for access should be if this is purely a matter for negotiation between the parties. If the owner of the ransom strip is too ambitious, the developer may decline to pay, and the owner of the strip will receive nothing
However, there will be situations in which courts and tribunals have to take a view of the issue. This will occur if, for example, if:
• A ransom strip is being compulsorily purchased, in order for development to take place
• A court has been asked to grant an injunction, to prevent or stop trespassing on a ransom strip, but has decided instead to award compensation.
In such cases, the view has sometimes been expressed that the “deal must feel right”. That is sometimes understood as meaning that the amount should be about a third of the net profit flowing from the development which will take place when access is obtained. This approach is a useful guide to parties engaged in private negotiations.
Help from Property Law Advice
For the sorts of issues which arise in practice, and on which we can offer advice, please see our Ransom strips page. If you’d like a quick response, to see whether we can help, please see our Initial enquiry page.
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