What is it: Deed of Variation relating to Property

What is a Deed of Variation?

A Deed of Variation is a legally binding document used to amend specific terms in an existing property document. It can apply to a range of documents, including transfers, deeds and leases. These documents often contain obligations or restrictions that may only become apparent later, for example when an obligation falls due or a restriction prevents a party from taking a particular action. In those circumstances, the parties may need to enter into a Deed of Variation so the original terms better reflect their current needs.

Who drafts a Deed of Variation?

A Deed of Variation is usually prepared by a solicitor or licensed conveyancer. Template forms are available, but the drafting can be simple or complex depending on the variation required. Careful legal drafting is important to ensure the changes accurately reflect the parties’ intentions and do not unintentionally affect their rights or obligations. The parties should also understand the impact of the variation, as it may make the original position more or less restrictive.

What does a Deed of Variation cost?

There is no fixed cost for a Deed of Variation. The cost will depend on the complexity of the changes being made. Some variations may also require supporting documents, such as a revised plan if the original plan is found to be inaccurate. In that case, the parties may need to contribute to the cost of preparing the new plan as well as the legal fees for the Deed of Variation. The cost of preparing a plan or other supporting document is usually a third-party cost rather than a solicitor’s fee.

Who pays for the Deed of Variation?

In most cases, each party to a Deed of Variation pays its own legal fees. However, if one party requests the variation and is the only party benefiting from it, that party may be expected to pay the other party’s legal fees. For example, if a transfer deed restricts the transferee from doing something and the transferee later asks for that restriction to be removed or relaxed, the transferor may ask the transferee to cover their legal costs, as the transferor receives no real benefit from the change.

Does a Deed of Variation need to be Registered?

Whether a Deed of Variation needs to be registered depends on whether the original document is registered with HM Land Registry. If the original document, such as a lease, is registered, the Deed of Variation should usually be filed with HM Land Registry so it is clear that the original document has been amended. The original document will normally remain available in its original form, allowing the position before and after the variation to be identified. A manuscript note is also often added to the cover page of the original document to confirm that it has been varied. This note usually records the date of the Deed of Variation and the parties to it, helping to identify the document that made the changes and the provisions affected.

If you would like help preparing or entering into a Deed of Variation, please contact our Real Estate Team, who would be happy to assist.

This article is part of our “What Is It” series where we consider various property documentation and explain what it is and when it is used, find more in the series here.