Law Commission Consultation Paper No 211 CONSERVATION COVENANTS A Consultation Paper ii THE LAW COMMISSION – HOW WE CONSULT About the Law Commission: The Law Commission was set up by section 1 of the Law Commissions Act 1965 for the purpose of promoting the reform of the law. The Law Commissioners are: The Rt Hon Lord Justice Lloyd Jones, Chairman, Professor Elizabeth Cooke, David Hertzell, Professor David Ormerod QC and Frances Patterson QC. The Chief Executive is Elaine Lorimer. Topic of this consultation: This Consultation Paper examines the case for introducing “conservation covenants” into the law of England and Wales, and considers how a scheme of conservation covenants might be framed. A conservation covenant is a private agreement made by a landowner, for the purposes of conservation. We discuss the current law and set out a number of provisional proposals and options for reform on which we invite consultees’ views. Geographical scope: The Consultation Paper applies to the law of England and Wales. Impact assessment: In Chapter 9 of this Consultation Paper, consultees are asked also to comment on the likely costs and benefits of any changes provisionally proposed. Consultees’ responses will inform our final recommendations and a formal impact assessment document that will be published with our Report. Availability of materials: This Consultation is available on our website at: http://lawcommission.justice.gov.uk/consultations/conservation-covenants.htm. Duration of the consultation: We invite responses from 28 March 2013 to 21 June 2013. Comments may be sent: By email to: [email protected] or By post to: Luke Campbell, Law Commission, Steel House, 11 Tothill Street, London SW1H 9LJ Tel: 020 3334 0200 / Fax: 020 3334 0201 If you send your comments by post, it would be helpful if, whenever possible, you could send them to us electronically as well (for example, on CD or by email to the above address, in any commonly used format). After the consultation: In the light of the responses we receive, we will decide our final recommendations and present them to Government. iii Consultation Principles: The Law Commission follows the Consultation Principles set out by the Cabinet Office, which provide guidance on type and scale of consultation, duration, timing, accessibility and transparency. The Principles are available on the Cabinet Office website at: https://update.cabinetoffice.gov.uk/resource-library/consultation-principles-guidance. Freedom of Information statement Information provided in response to this consultation, including personal information, may be subject to publication or disclosure in accordance with the access to information regimes (such as the Freedom of Information Act 2000 and the Data Protection Act 1998 (DPA)). If you want information that you provide to be treated as confidential, please explain to us why you regard the information as confidential. If we receive a request for disclosure of the information we will take full account of your explanation, but we cannot give an assurance that confidentiality can be maintained in all circumstances. An automatic confidentiality disclaimer generated by your IT system will not, of itself, be regarded as binding on the Law Commission. The Law Commission will process your personal data in accordance with the DPA and in most circumstances this will mean that your personal data will not be disclosed to third parties. iv THE LAW COMMISSION CONSERVATION COVENANTS: A CONSULTATION PAPER CONTENTS Paragraph Page CHAPTER 1: INTRODUCTION 1 Introduction 1.1 1 Background to the project 1.9 2 Wales 1.13 4 Structure of this Consultation Paper 1.15 5 Chapter 2 1.15 5 Chapter 3 1.16 5 Chapter 4 1.17 5 Chapter 5 1.18 6 Chapter 6 1.19 6 Chapter 7 1.20 6 Chapter 8 1.21 6 Chapter 9 1.22 6 Chapter 10 1.23 6 CHAPTER 2: CURRENT LAW AND THE CASE FOR REFORM 7 Introduction 2.1 7 What is a conservation covenant? 2.5 7 The parties 2.6 8 Made for conservation purposes 2.7 8 Running with the burdened land 2.8 8 v Paragraph Page No need for benefited land 2.10 8 Negative and positive obligations 2.13 9 Potential uses for conservation covenants 2.17 10 As an alternative to acquisition of land by public or voluntary sector bodies 2.18 11 As a safeguard where voluntary sector or public bodies dispose of their land 2.19 11 As a guarantee for individuals who sell their land 2.21 12 As an alternative to a financial donation 2.23 12 Payment for conservation action 2.24 12 Offsetting schemes 2.25 13 Further scenarios 2.29 14 The current law 2.31 14 Freehold covenants 2.32 15 Workarounds 2.36 15 Planning law and biodiversity offsetting 2.48 18 Designation of land 2.55 20 The case for reform 2.67 23 General provisional proposal 2.72 24 CHAPTER 3: COMPARATIVE LAW 25 Introduction 3.1 25 Scotland 3.7 26 Historical background 3.8 26 The legislative scheme 3.11 27 Use of conservation burdens in practice 3.15 28 vi Paragraph Page USA 3.18 29 The Uniform Conservation Easement Act 1981 (“the UCEA”) and state laws based on it 3.19 29 Other state legislation 3.27 32 Use of conservation covenants in practice 3.31 33 Canada 3.35 34 Provincial legislation 3.36 34 Use of conservation covenants in practice 3.39 35 Australia 3.41 35 State and federal legislation 3.42 35 Use of conservation covenants in practice 3.46 36 Biodiversity offsetting in Australia 3.48 37 New Zealand 3.51 38 The legislative scheme 3.52 38 Use of conservation covenants in practice 3.56 39 Conclusion: Similarities and divergences 3.59 40 CHAPTER 4: KEY FEATURES OF A STATUTORY SCHEME 42 Introduction 4.1 42 Who should be able to create a conservation covenant? 4.3 42 Who should hold a conservation covenant? 4.9 43 The spectrum of covenant holders 4.9 43 Holders of conservation covenants in other jurisdictions 4.11 43 Holding a conservation covenant in England and Wales 4.18 46 What conservation objectives should be sufficient to justify the creation of a conservation covenant? 4.30 49 Public oversight of new conservation covenants 4.41 52 vii Paragraph Page CHAPTER 5: CREATION AND REGISTRATION 55 Introduction 5.1 55 The nature of a conservation covenant 5.2 55 Formal requirements for validity 5.9 56 Duration 5.11 56 Terms 5.15 57 Standard terms 5.21 59 Registration 5.24 59 Priority 5.33 61 CHAPTER 6: MANAGEMENT AND ENFORCEMENT 62 Introduction 6.1 62 Managing obligations 6.5 62 What sort of management might be undertaken? 6.5 62 Statutory or agreed management obligations 6.11 64 Enforcement of the landowner’s duties 6.16 65 Liability for a breach 6.18 66 Approaches to conservation covenant enforcement in other jurisdictions 6.21 66 Enforcement of conservation covenants in England and Wales 6.29 69 Enforcement of the responsible body’s duties under a conservation covenant 6.60 75 CHAPTER 7: MODIFICATION AND DISCHARGE 77 Introduction 7.1 77 Action by the parties 7.5 78 Unilateral release by the responsible body 7.5 78 By agreement 7.12 79 viii Paragraph Page The effect of merger 7.17 81 Adjudicated modification and discharge 7.21 81 Section 84(1) of the Law of Property Act 1925 7.22 82 Section 84(1) today 7.26 83 Our proposals in the Easements Report 7.40 87 The application of section 84(1) to statutory covenants 7.43 88 The Lands Chamber and conservation covenants 7.47 89 Declarations under section 84(2) of the Law of Property Act 1925 7.72 95 Modification under the planning system 7.75 95 CHAPTER 8: EXISTING STATUTORY COVENANTS 97 Introduction 8.1 97 Methods of modification and discharge 8.4 97 Statutory provisions which could be replaced by conservation covenants 8.5 98 Restrictive covenants made with the National Trust 8.6 98 Forestry dedication covenants 8.17 100 Other statutory covenants 8.26 103 CHAPTER 9: THE POTENTIAL ECONOMIC IMPACT OF CONSERVATION COVENANTS 104 Introduction 9.1 104 Likely costs and benefits 9.2 104 Scope and scale 9.2 104 Development and growth 9.8 105 Better and more effective conservation 9.12 106 Removing the need for existing workarounds 9.16 107 Changes to the value of land 9.21 108 ix Paragraph Page Management and enforcement 9.24 109 Transitional impact 9.29 109 Modifying or discharging a conservation covenant 9.37 110 Increasing engagement 9.44 112 Further impacts 9.46 112 CHAPTER 10: LIST OF PROVISIONAL PROPOSALS AND CONSULTATION QUESTIONS 113 APPENDIX A: STATUTORY COVENANTS IN ENGLAND AND WALES 124 APPENDIX B: STATUTORY PROVISIONS 145 x CHAPTER 1 INTRODUCTION INTRODUCTION 1.1 Green spaces and unique habitats, remarkable buildings, and historic places are valuable to us. They give us a sense of identity and community; they help us to be healthier; they broaden understanding of our social and cultural heritage; they provide opportunities for recreation and relaxation; and they contribute to our economy. Historically, protection of these places was undertaken by individuals, families, and later by voluntary organisations. More recently, though, the emphasis has shifted, and the state has taken on responsibility for them by creating regimes of special protection, such as Sites of Special Scientific Interest, and National Parks. 1.2 This project is about unlocking opportunities for individuals and conservation organisations to work together, using voluntary private agreements, to contribute to the cause of conservation. Our proposals therefore sit alongside, but are entirely different from, the mandatory public law mechanisms which already exist.1 1.3 How, then, can people make this contribution? At present, a number of complex and costly legal methods are available to protect land; they are not only inefficient, but have led to a piecemeal approach to private conservation of land in England and Wales.