If parties to a boundary dispute enter into a compromise the agreement settling the dispute will not be binding if it falls foul of the provisions of s2 of the Law of Property (Miscellaneous Provisions) Act 1989, which sets out the legal requirements in relation to dispositions of land. That section is in the following terms:
(1) A contract for the sale or other disposition of an interest in land can only be made in writing and only be incorporating all the terms which the parties have expressly agreed in one document or, where contracts are exchanged, in each.On this page we discuss when a boundary agreement will be binding; and how to make sure that it is so binding.
(2) The terms may be incorporated in a document either by being set out in it or by reference to some other document.
(3) The document incorporating the terms or, where contracts are exchanged, one of the documents incorporating them (but not necessarily the same one) must be signed by or on behalf of each party to the contract.
(5) … nothing in this section affects the creation or operation of resulting, implied or constructive trusts.
Two types of boundary agreement
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 1989 Act; 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 Law of Property Act 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 no more than identify on the ground what the documents describe in words or delineate on plans. Nothing is transferred, at any rate consc ... THIS IS AN EXTRACT OF THE FULL TEXT. TO GET THE FULL TEXT, SEE BELOW
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