Claim Case Study Scotland: Access Servitude right Background
Solution
The insured purchased a pub and hotel in April 2008. At the time of the purchase, the area surrounding the pub and hotel, lying between it and the public highway, did not form part of the seller’s title, and the policy was obtained to cover this lack of title. The sellers had used the area of land for many years to access the pub and hotel and as a car park for themselves and for their clients and visitors.
The insured was fortunate to have a policy for the lack of title with First Title. First Title established that, due to a lack of available evidence, it was not possible to establish a servitude right to use the car park for parking. First Title could not defend the insured’s position.
Challenge Some eight years later, the insured received a letter from the owners of the neighbouring land, stating that they were selling their property and included in the sale was the area of land the insured used as a car park. The letter stated that the insured must remove all their belongings from the car park within 30 days and cease to use it for any purpose.
Negotiations, therefore, commenced with the neighbours and their prospective purchasers and agreement was reached for the insured to retain three of the seven available parking spaces in exchange for £1. In order to determine the level of compensation for the insured for the loss of the four parking spaces, First Title obtained a professional valuation of the pub and hotel. The diminution in value was reported to be £20,000. A payment of this amount was made to the insured in settlement of the claim, and all legal expenses incurred were covered by the policy.
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