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Boundary agreements
Definition
The general understanding in relation to boundary agreements has been that if the parties are merely seeking to define a boundary that is not clear no specific formalities are required to make the agreement binding. On the other hand, if the parties are exchanging land then it is necessary to comply with the requirements of s2 of the Law of Property (Miscellaneous Provisions) Act 1989; i.e. be in writing etc. This is based on the decision in Neilson v Poole (1969) 20 P&CR 909 decided in relation to formalities under the LPA 1925. In that case Megarry J said this:Now a boundary agreement may constitute a contract to convey land. The parties may agree that in return for a concession by A in one place, straightening the line of division, B will make a concession in another place; and the agreement may thus be one for the conveyance of land. But there is another type of boundary agreement. This does not more than identify on the ground what the documents describe in words or delineate on plans. Nothing is transferred, at any rate consciously; the agreement is to identify and not to convey. In such a case, I do not see how the agreement can be said to constitute a contract to convey land. In general, I think that a boundary agreement will be presumed to fall into this latter category. There may of course be cases in which it is uncertain or doubtful whether a boundary agreement will convey any land. Thus, the configuration of the boundary may suggest that land will be conveyed, without demonstrating this beyond doubt. In such a case I would hold the agreement not registrable A contract merely to demarcate and confirm is not a contract to convey. (GWs emphasis). Thus, there is a clear distinction between the two types of agreement. Or at least there was until this case where the CA has now held that the principle in Neilson v Poole case applies to the conscious exchange of very small pieces of land:In this case .. Mr Rigolli consciously thought that he was giving up a small triangle of land round the cherry treeEven so, the area of land disposed of by both parties was of a very small amount. It would be unrealistic to require the parties to execute a transfer of the land given up by Mr Rigolli. In both cases the land would also be quite difficult to define without the disproportionate expense of a survey. Further, to make the validity of a boundary agreement dependent on the preparation and execution of a written contract would be contrary to the important public policy of upholding boundary agreements so powerfully identified by Megarry J In those circumstances I do not consider that Parliament, which after all enacted section 2 against the background of Neilson v Poole, could have intended the section to apply to transfers of land pursuant to boundary agreements of Megarry Js latter type (demarcating agreements) simply because a trivial transfer or transfers of land were consciously involved. (para 32). As Megarry J put it, a boundary agreement is an act of peace, quieting strife and averting litigation. If section 2(1) applies where trivial transfers of land are consciously involved, the expense to the parties will also be disproportionate to the value of the land involved, the expense to the parties will also be disproportionate to the value of the land involved. Accordingly, in my judgment, it can in this case be properly concluded that s2 does not apply to trivial dispositions of land consciously made pursuant to an informal boundary agreement of the demarcating kind. (Arden LJ). This decision is obviously wrong CA or not and is inconsistent with the passages in Neilson v Poole that the court sought to apply. If two parties are consciously exchanging land it is quite clear that s2 of the 1989 Act applies however small the area of land transferred.
In the alternative Arden LJ held that there was an estoppel giving rise to a constructive trust, which disapplies s2 by virtue of s2(5) see Yaxley v Gotts [2000] Ch 162. In any particular case there might well be an estoppel but this will not necessarily bind purchasers.
I suggest that parties settling boundary disputes continue to ensure that the agreement is in writing, in full compliance with s2, and that notice of it is registered with the Land Registry. We may one day find that this case is overruled.
Joyce v Rigolli [2004] EWCA Civ 79.
Article:Marking Your Territory. By Mike Harwood Discussion of the case(154 New Law Journal 406).
Consent order - giving effect to the order on the ground
The parties compromised a boundary dispute and the agreement was embodied in a consent order. A plan was annexed to the order. Unfortunately, when the surveyors sought to give practical effect to the agreement on the ground there was a disagreement in relation to one point on the boundary. One of the parties argued that this made the agreement void and her contention was upheld by the judge. The argument was rejected in the CA.28. Mr Laurence was asked in the course of his submissions if he could cite any case in which a consent order of the court had ever been declared to have been void on the ground of uncertainty: but he was unable to say that that had ever happened. In theory it is, I suppose, possible, just as a consent order may be set aside for misrepresentation or fraud or for mistake. However, given that the court is always on hand to lend its assistance in the working out of its orders or in their clarification, it cannot be a mere difficulty in interpretation or execution that can undo what with due formality has been entered as an order of the court in settlement of litigation before it.
30. Parties are always disagreeing about the contracts which they make. They take those arguments, if necessary, to the courts, or to arbitration, for their resolution: and sometimes the resolution is very difficult indeed to arrive at. That is equally true of disputes as to the meaning of contracts and of disputes as to the application of contracts to the facts and of disputes as to the proper understanding of the facts. None of that makes a contract uncertain. For that to occur and it very rarely occurs it has to be legally or practically impossible to give to the parties' agreement any sensible content.
39. The applicable legal motto is: that is certain which can be rendered certain (id certum est quod certum reddi potest). What would to my mind be a complete injustice would be, just because of the difficulty about the precise position of the boundary line in immediate juxtaposition with the telegraph pole, to conclude that the parties had completely failed on the grounds of uncertainty to settle their litigation at all, although that is what they plainly intended to do and what they did in fact do with the aid of a detailed consent order and plan.
40. As for Mr Justice McCombe's conclusion that the consent order was uncertain because it needed further agreement in order to be implemented, I respectfully disagree. The most that could be said is that its implementation, in this matter of the telegraph pole, threw up a relatively small practical problem of detail which in turn involved a problem of interpretation. . it is only in the absence of agreement as to essential terms that a contract is in danger of failing for uncertainty because further agreement is required. The world is otherwise full of perfectly sound contracts which require further agreement for the purpose of their implementation. Furthermore, if problems of interpreting plans for the purpose of identifying boundaries were to lead to the failure of contracts, then plans would have to be as large as the area of land in issue. Comment: The consent order was upheld but the case shows the importance of ensuring that any agreement that is made is workable on the ground.
Scammell v Dicker [2005] EWCA CIV 405.
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