Land-sale overage

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In the context of land sales, overage (also called “claw back”) is used to describe a sum of money in addition to the original sale price which a seller of land may be entitled to receive following completion if and when the buyer complies with agreed conditions.

Example

A typical scenario would be: On completion, a Buyer pays a given price for a piece of land and the Seller is aware of the Buyer’s intention to develop the land. Overage provisions are negotiated into the contract of sale to ensure that once planning is obtained, the Seller receives a proportion of the increase in the value of the land.