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Subdivisions: a chip off the old block

This article was written by Tom Appleton.

Subdividing land is the legal process for converting one land title to two or more land titles.  The surveyor will take control of the early stages, while the latter part of the process typically has a more legal focus and is driven by the lawyer.  While the surveyor will often be a client’s first point of contact, it will be useful if some form of initial planning discussion is held between the client, surveyor and lawyer before the subdivision is commenced.

Key aspects that should be discussed during the preliminary stages include:

  1. Local council requirements: Each council has a District Plan, which among other things will set out permitted allotment sizes and dimensions, rules around building locations and the supply of services (water, telecommunications and sewage) to name just a few considerations.
  2. Title constraints: A review of the underlying title will identify any easements, covenants or encumbrances that might act as an obstacle to the subdivision. Crucially this will identify any aspects of the subdivision that might require a neighbours consent. If not identified early and a neighbour later refuses consent, it can be costly to find an alternative.
  3. Costs: further investigation may reveal that the costs of subdividing a parcel of land make for an uneconomical return. Costs will include council application fees, physical site works, professional fees (surveyor, lawyer, engineer etc.) and development contributions payable to the council.

Once the preliminary matters have been ironed out and a person has decided to proceed, the next step is to apply to the council for a resource consent to obtain approval to the proposed subdivision. The surveyor is usually responsible for preparing a scheme plan and drafting the resource consent application for submission to the council. In complex subdivisions a lawyer or specialist planner may be involved in drafting the application. The council will then review the application, it will raise any concerns or issues that are relevant that have not already been covered, and these will need to be satisfactorily addressed before the consent can be granted.  It is important to take time to try and submit a comprehensive consent that meets the client’s needs from the outset because once a consent has been granted, it can be costly both in terms of time and money to apply to vary it.

After the council has issued the resource consent, the subdivider can arrange for its contractors to start on the physical site works. These can include installation of services including drainage, water, sewage and electricity infrastructure, as well as access ways to the individual lot boundaries. The surveyor will also carry out the formal plotting of the subdivision and prepare a Land Transfer Plan (LT Plan). The LT plan will include a record of all easement areas, roads or reserves, covenants and notices which are required under the conditions of the resource consent.

Once the surveyor has prepared the LT Plan, the lawyer will be able to start work on the legal documentation for creation of the new titles. This will include the preparation of the easements, covenants, notices and any other documents required under the resource consent. The lawyer will liaise with any affected parties to negotiate the appropriate terms of and prepare the documentation for registration. Parties involved often include the council, service providers (telecommunications, gas, power companies) and neighbours.

When the LT Plan has been finalised and the physical site works completed, the surveyor will apply to the council for certification that the requirements of the Resource Consent have been met. If the lawyer and surveyor have co-ordinated their efforts, the legal documentation should be finalised at approximately the same time as the council’s certifications issue. The lawyer will then submit the title documents with Land Information New Zealand (LINZ) for processing, while the surveyor submits the LT Plan to LINZ.  After a period of a few weeks new titles for the subdivided land will issue.

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