Private road transfer.

[Hughes 66]

My friend lives in a road which has become an asset as part of a liquidation.She has had a letter from a solictor asking if she is interested intaking a transfer of the road to prevent it becoming "bona vacantia".It says if this occurs then the road will become the property of the state in due course.The cost of the transfer would nil to her but she would have to pay a solictor for the transfer.There are 4 persons in the same road.Can any one explain the above in simple terms.Thanks.

[buildersmate]

You can read about bona vacantia here.
http://www.bonavacantia.gov.uk/output/companie s.aspx
The last paragraph is significant because it indicates that the Crown usually declines to take over 'onerous assets' - and quotes the private road situation as an example.
I suspect your friend is going to need paid-for legal advice, because it may not be in her best interests to have the asset (the land on which the road sits) transferred to her. You also mention that 3 other properties are impacted.
She is going to have to look at the wording of the easement (private right of way) that she has to access across this land, and any restriction (obligation to the freeholder - the company that the Crown is in the process of dissolving) to pay for maintenance of it.
What won't happen (IMO) is that the Crown offers to transfer the road to part of the public road network - and the road becomes adopted - which means maintained at public expense by the local authority.
The Crown can't take her legal right of access away - and no-one else is likely to want to buy the land.
What is the nature of the link between the private road and the company in liquidation? - is it a property developer, or the business premises of a bust company that just happens to be at the top of the road?

[Hughes 66]

Thanks for your answer.The road in question was /is owned by a property developer/builder who has gone bankrupt.He built the road off the main road.He stated on the purchese that the 4 purchasers of the property would be responsible for the maintainance of the road altho he would be the owner.the 4 ladies living on the property dont want to purchase the road in any sercumstances.What do they do now?

[buildersmate]

Hmm, difficult situation.
In the first instance I'd advise her to go back to the solicitor who advised her on the purchase of the property in the first place. That person should have checked out the proposed access arrangements and advised their client accordingly. OK, they may say they could not have forseen the developer doing out of business and that maybe true, but the whole business about having an access controlled by the third-party (but not the local authority, when the access is 'adopted') is a bad idea.
I'm intrigued, because property developers do not usually want to hold onto roads UNLESS they own or have an interest in a bit of land further down the access at the bottom, and they want to hold control of the access to be able to ensure the possibility of 'opening up' the land at the bottom down there later. Please comment on this - is it a possibility? Now if the bust developer does own land at the bottom already, it would be part of the same set of assets that the State is trying to deal with. In THAT case, I'd be suggesting that the Sate ought to selling the access road and the land at the end as a single parcel - thereby ensuring that any future developer who bought it ALSO held the requirement to deal with it properly.

[buildersmate]

Now I will deal with how developers usually deal with this issue. When planning permission is sought from the local authority, they enter into a 'Section 106 Agreement' with the authority. This involves them agreeing to construct the road up the minimum standards of the authority. At the end of the development, the final surface of the road is made-up, the council inspects, and it formally accepts the future maintenance liability on the road. Developers have to pay a lump sum agreed with the council for doing this, which is tied to the S106 Agreement. Because the councils have been caught before with developers going bust before the road is finally finished (it has to be the last thing done), they typically force the developer to deposit a cash bond with a third party such that they can get the road finished in the event that the developer defaults.
Now that is why I am intrigued as to what happened here - it seems the developer decided to keep the land. He could have done this for one of two reasons:
1) Save money in not having to enter into a S106 Agreement regarding the access - thereby making the houses cheaper to the purchasers (or more profit for him) - in which case why didn't the solicitor flag this to your friend on purchase?
2) He owns or has an interest (option to puchase perhaps) on land further down the track at the bottom (back to my post immediately above).
Sorry this is so long - I am trying to explain the background to how these things work so your friend can work out what to do.
She needs more information - because just taking on the 'bone vacantia' land may cause more troubles than it helps with. If the other 4 owners do not want to own this land, she would have to set up legal agreements with them such that the cost of maintenance is shared equally - this involves changing their land titles.

[Hughes 66]

Hello buildersmate,thanks for your further reply.I think your advice to go back to the house purchase solicitor is the way forward at the moment.I dont think there can be any more land other than the road in question as it is a t shaped road off the main road and dead ends left and right.I dont know if the other 3 ladies are interested what happens at the moment so lets see if the original solicitor comes up with anything.

[buildersmate]

This should be done for free. The basis of this enquiry should be 'Hey, the house purchase you provided me with the legal advice for has gotten messed up. Would you care to comment, Mr. Solicitor?