Neil Cadwallader Property Law

Competition law and land agreements

2010-10-18T11:01:00.000+01:00

An OFT consultation papers is out today on the effect on land agreements of the revocation of the Land Agreements Exclusion Order. With effect from 6th April 2011 the prohibition of anti-competitive agreements in Chapter 1 of the Competition Act 1998 will apply to land agreements.

Restrictive user covenants in shopping centres, for example, will have to be considered (and reconsidered from time to time) in the light of this change.

The consultation paper is about the OFT's draft guidance on the application of the law in this field.

Exchange Chambers Property Law Seminar

2010-09-06T10:22:00.000+01:00

I hope many of you will be able to come to our 1 day Property Seminar at the Lowry Hotel in Manchester on 23rd September.

Our speakers include Edward Cousins, Adjudicator to HM Land Registry, and members of Chambers including Anthony Elleray QC, Mark Cawson QC, Bill Hanbury, Stephen connolly, Guy Vickers and myself. I will be in the Chair.

The topics to be covered include conveyancers' negligence and fraud, negligent valuation, recent security issues, keeping the tenant on the hook, land estoppels, Land Regsitry Adjudication and rectification and real property.

For more details contact me or email stapley@exchangechambers.co.uk. It should be a great conference!

Mediation panel

2010-02-03T14:53:00.001Z

I am pleased to have accepted an invitation to join the panel of mediators at Consensus Mediation.

Land Registry Adjudicator

2008-11-26T12:14:00.003Z

I am happy to say that I have been appointed a part-time Deputy Adjudicator to HM Land Registry. This work should be very interesting.

Agreement for a lease

2008-11-21T07:54:00.002Z

The Privy Council has published a new decision on the creation of an agreement for a lease: FBO 2000 (Antigua) Ltd v Vere Cornwall Bird Jr [2008] All ER (D) 175. I haven't seen the opinions yet, but the Lexis summary suggests it offers nothing terribly new: it was held that the Antigua government had reached a sufficiently firm agreement for a lease where the essential terms of the transaction, i.e. the parties, the land, the term, and the rent had all been agreed.

I will be quite interested to see what they have to say about the degree of significance to be attached to the fact that the claimant had had entered into occupation and undertaken building works.

Land Registry adjudication decisions

2008-11-19T09:21:00.003Z

There is a useful free site (part of the Tribunals Service website) which reports decisions of Land Registry adjudicators. It only reports them if

(1) they contain a statement of law or practice that is of general interest, and may be of assistance to other parties using the website or
(2) they decide points of law which have not, so far as the Adjudicator has been able to ascertain, been the subject of any other decision or
(3) they are in some other way of general importance.

It offers unrivalled access to current thinking in this important jurisdiction, but it is rather hidden away, so here is the address: http://www.ahmlr.gov.uk/Public/Search30May.aspx. I hope you find it interesting.

Landlord seeking to sue company in administration

2008-11-19T08:38:00.002Z

Sunberry Properties Ltd v Innovate Logistics [2008] EWCA Civ 1261, CA (reported on LEXIS today) is a useful reminder of how not to approach an application for permission to bring proceedings regarding the breach of a lease where the prospective defendant is in administration.

The point of the administration was to do better for the company's creditors as a whole than if the company were wound up right away. It was up to the claimant to show that it was inequitable not to be able to sue. The court had to balance the legitimate interests of the landlord and those of the other creditors. Here, it had to compare the landlord’s loss if it could not sue, with the other creditors’ losses if it could. But it was very important not to interfere more than strictly necessary with the landlord’s proprietary interests. Even so, if the other creditors would suffer substantially greater loss, or loss out of all proportion to the benefit, that might outweigh the landlord’s loss.

Here the judge had gone wrong in several ways.

He had criticised the administrators on a misunderstanding.
He had wrongly thought the purpose of the administration would not be impeded by proceedings, on the footing that it had already been achieved on the sale of the business; but one of the main purposes of administration was still to collect the book debts.
He had not done the balancing exercise properly: the administration needed the company to occupy the property.

Procedural irregularity in adjudication

2008-11-18T07:50:00.001Z

In Spragg v Whittle His Honour Judge Raynor QC sitting as High Court Judge of the Chancery division, heard an appeal from the decision of a Land Registry adjudicator on 17th November 2008 argued on both sides by litigants in person.

The adjudicator had let one of the parties raise and give evidence on a claim for adverse possession for the first time at the hearing itself.

The Judge held this to be a procedural irregularity, since the other party had not had full notice of the case being raised, or an opportunity to consider putting his own evidence in on the point (although they had been able to cross-examine on it) before the adjudicator made his decision.

A new adjudication was ordered to be undertaken.

Spirerose - CPO compensation

2008-11-17T09:07:00.000Z

EGi reports a Court of Appeal ruling that compulsory purchase compensation for a City of London site should be calculated on the basis of the site's full value with planning permission, not merely a percentage to reflect the probability of the permission being granted. The Lands Tribunal decision was upheld.

The Court of Appeal expressly said, however, that there is no anomaly in giving just a hope value in cases where there would have been a possibility, but less than a probability, of planning permission.

The case is Spirerose Ltd (in administration) v Transport for London [2008] EWCA Civ 1230.

Paul Hamlyn Foundation awards

2008-11-14T13:24:00.002Z

A little off topic, but I cannot not mention that I have just returned from yesterday's award ceremony at RIBA in London at which my friend and favourite contemporary composer, Emily Howard, has received a substantial award. For those interested, her website is at http://www.emilyhoward.com/

Recorder

2008-11-11T07:56:00.002Z

I am pleased to announce that I have been appointed a Recorder dealing with Chancery matters on the North Eastern Circuit.

Enforcing part of an arbitration award

2008-10-22T14:03:00.001+01:00

The Court of Appeal has held in IPCO (Nigeria) Ltd v Nigerian National Petroleum Corporation [2008] All ER (D) 197 that a judge in an enforcing court in relation to a Convention arbitration is entitled to enforce part of the award – it was not a case of all or nothing.

By s. 100 Arbitration Act 1996, a New York Convention award shall be recognised as binding on the persons as between whom it was made and may accordingly be relied on by those persons ... in any legal proceedings in England and Wales or Northern Ireland'. 'Award' should be construed to mean the 'award or part of it'.

e-disclosure

2008-10-14T08:50:00.000+01:00

The Chartered Institute of Arbitrators launched its new Protocol on E-Disclosure in Arbitration on 2nd October.

It offers a sensible template for dealing with disclosure in cases where there are large numbers of electronic dcuments.

The protocol may be found at: http://www.arbitrators.org/institute/CIArb_e-protocol_b.pdf

Today's the day for residential estate agents

2008-10-01T11:45:00.002+01:00

As from today every residential estate agency has to join an approved ombudsman scheme or face a fine.

So far the OFT has approved two schemes: one is operated by the Ombudsman for Estate Agents Company Ltd; the other by the Surveyors Ombudsman Service. A scheme by the Register of Estate Agents is on the way.

Edge Lane CPO goes through

2008-09-30T16:36:00.000+01:00

The Compulsory Purchase Order for the Edge Lane West regeneration scheme in Liverpool, which was initially refused in 2006, has been confirmed.

The development will provide hundreds of new homes (I like the old ones) , an “urban boulevard” (not sure about that) and retail and business space, but involves the demolition of a large number of houses on the main route to the M62.

Mixed reactions

2008-09-03T11:33:00.002+01:00

Critics of the government plans to kick-start property recovery include the Federation of Master Builders, the National Federation of Builders, the Intermediary Mortgage Lenders Association, the Council of Mortgage Lenders, and Capital Economics.

However, share prices in house builders rose markedly on the announcement, including those of Taylor Wimpey, Persimmon, Bovis and Mapeley.

Not quite what was intended, I suspect.

Government housing support package

2008-09-02T17:12:00.000+01:00

EGi reports that from tomorrow, the government is to suspend stamp duty for all homes costing less than £175,000.

For those on incomes less than £60,000, the new HomeBuy Direct scheme will offer first time buyers a free loan for up to 30% of the value of the home for up to five years. This is to be partly funded by the developers.

There are also proposals for a mortgage rescue scheme, and funding to help to help 6,000 vulnerable homeowners facing social housing providers to provide more social houses over the next 18 months.

There will also be help for sale and leaseback schemes.

Non-compensatory damages again

2008-09-01T09:22:00.001+01:00

This is pretty interesting.

In Field Common Ltd v Elmbridge Borough Council [2008] All ER (D) 141 the local authority owned an industrial estate, and by resurfacing not only its right of way, but other land of the claimant without consent, had encouraged its tenants to trespass on that land, so as to have permitted that trespass and become liable for damages for it.

The point of interest is that the Court held that the claimant was entitled to compensation in respect of the benefits that the landlord had enjoyed as a result of the tenants' trespass, as if they were an enjoyment of the land itself. That was held to be a permissible extension to the exception to the general rule that damages in tort were compensatory (I am still not sure there is an exception, personally).

In this case, it meant that damages should be awarded on the basis of a hypothetical negotiation of a licence to encroach: that approach best reflected justice as between the parties.

Broken teeth

2008-08-26T08:03:00.001+01:00

Since April this year, the owners of empty property have had to pay full business rates. Offices and shops used to get 50% relief, and industrial property was exempt.

It turns out that all 19 of England’s urban regeneration companies sent a letter to the government in May 2007 outlining concerns over the empty property tax, but those concerns were dismissed.

Now they have given up on quiet diplomacy and gone public.

EGi quotes the Chairman of the URC Chief Executive Committee and chief executive of the Leicester Regeneration Co, John Nicholls, as saying that: “In areas of market weakness, where projects are by definition marginal, this will increase the requirement for public funding to make development happen.

The credit crunch has meant that a lot of sites assembled by residential developers are not being taken forward but are being demolished to avoid the tax. Swathes of Leicester are starting to look like broken teeth.”

Buy to let professionalism

2008-08-18T08:07:00.001+01:00

Speaking of professionalism, the British Property Federation reckons that “The public has the right to have confidence in property professionals and it is about time that we delivered this. This will make the industry more professional, which will only encourage greater respect from the government and investors.”

This was is response to The Law Commission’s final recommendations on buy–to–let reform, which recommend making landlords join accreditation schemes, professional associations or use lettings agents; and providing a procedure for tenants to complain to these organisations or a central regulator.

I wonder if it is necessarily right that in a democratised lettings market, we really need to protect tenants more than we need to free the hands of landlords or potential landlords. Maybe it’s just my holiday mood.

Estate agents' redress scheme

2008-08-18T07:51:00.002+01:00

Under the Consumer Estate Agents and Redress Act 2007 the Secretary of State may require (by a redress scheme Order) those engaged in estate agency work in respect of residential property to be members of an approved redress scheme. The redress schemes need to be approved by the OFT.

The Secretary of State made a redress scheme Order on 1 July 2008. It will come in to force on 1 October 2008.

The OFT reports that it is has approved the application of the Ombudsman Service Limited to operate the Surveyors Ombudsman Service (SOS) as an approved estate agents redress scheme. It is the second to receive OFT approval ahead of 1 October 2008, when it becomes compulsory for all estate agents dealing with residential property in the UK to join such a scheme.

I suppose this could be regarded as a mark of professional status, in a sort of a way.

Bellway results due out

2008-08-13T09:33:00.002+01:00

Bellway is due to release its trading statement tomorrow. It'll be interesting to see what the figures look like. Times are tough for companies in the sector, but Goldman Sachs published a note on Monday saying Bellway is “one of the least likely to need a rights issue or face financial distress".

Testing evidence

2008-06-04T08:46:00.001+01:00

The case of Transview Properties Ltd v City Site Properties Ltd [2008] EWHC 1221 (Ch), a decision of Briggs J reported on Lawtel, contains a useful reminder of a useful dictum. He described it as a paradigm case for applying the following dictum of Lord Goff
in Grace Shipping v. Sharp & Co [1987] 1 Lloyd’s Law Rep. 207 at 215-6.

“And it is not to be forgotten that, in the present case, the Judge was faced with the task of assessing the evidence of witnesses about telephone conversations which had taken place over five years before. In such a case, memories may very well be unreliable; and it is of crucial importance for the Judge to have regard to the contemporary documents and to the overall probabilities. In this connection, their Lordships wish to endorse a passage from a judgment of one of their number in Armagas Ltd v. Mundogas S.A. (The Ocean Frost), [1985] 1 Lloyd’s Rep. 1, when he said at p. 57:−
“Speaking from my own experience, I have found it essential in cases of fraud, when considering the credibility of witnesses, always to test their veracity by reference to the objective facts proved independently of their testimony, in particular by reference to the documents in the case, and also to pay particular regard to their motives and to the overall probabilities. It is frequently very difficult to tell whether a witness is telling the truth or not; and where there is a conflict of evidence such as there was in the present case, reference to the objective facts and documents, to the witnesses’ motives, and to the overall probabilities, can be of very great assistance to a Judge in ascertaining the truth.”

That observation is, in their Lordships’ opinion, equally apposite in a case where the evidence of the witnesses is likely to be unreliable; and it is to be remembered that in commercial cases, such as the present, there is usually a substantial body of
contemporary documentary evidence.”

In that context he was impressed by a witness described in the following terms.

“Although like the other main witnesses his evidence was a mixture of reconstruction and original recollection, he took considerable trouble to distinguish precisely between the two, to an extent which I found convincing and reliable.”

That is so important, and so infrequently done.

Exchange Chambers Property Law Conference

2008-06-02T08:50:00.001+01:00

Exchange Chambers’ Property Law Conference is taking place at the Lowry Hotel, Manchester on Thursday 5th June 2008.

It is accredited with 5 CPD hours.

The topics to be covered are:

Dealing with tenant default
Insolvency
Property valuation in a fluctuating market
Developers’ toolkit
Case law & legislation update
Professional negligence
Dilapidations
Mortgage default

If you would like to attend, please contact campbell@exchangechambers.co.uk.

Spinningfields filling

2008-06-02T08:39:00.000+01:00

EGi reports that the General Medical Council is considering taking 50,000 square feet at 3 Hardman Street in Manchester’s Spinningfields. It is also looking at 40 Spring Gardens and Belvedere, however.

Barclaycard is also returning to its original plan of taking 80,000 square feet in the same building, occupying half and sub-letting the remainder.

Other prospective tenants include Bank of New York Mellon, Pinsent Masons and Regus.

Off-loading leases

2008-05-27T08:56:00.001+01:00

The CBI/GVA Grimley Corporate Real Estate Survey was published last week. Among its findings are that 20% of businesses are planning to reduce their property space. It was only 12% six months ago.

That is not surprising in current conditions. Rents in FTSE 200 companies amount to 25% of profits, the report says.

In good times, however, property costs are not high on the agenda. Now they are becoming important. The report found that by the end of February 2008, construction companies suffered an 80% increase in operating lease liabilities and property provisions as a percentage of the value of their business, for example.

The trouble is that it is not easy reducing property costs where you have the long inflexible leases with upward only rent reviews which are still pretty much the norm.

I think we are going to see increasingly desperate attempts to get out of them – and that may mean an increase in property litigation.

Rising defaults expected

2008-05-27T08:40:00.000+01:00

Research published by Investec Private Bank on Friday shows that nearly 90% of property professionals expect defaults on commercial property to increase in the next 12 months – but believe that banks will continue to lend to property investors and developers.

The wisdom of crowds. Though apparently as many as 4% think that banks will stop lending altogether!

Co-op to stay central

2008-05-21T08:57:00.000+01:00

Co-operative Group, one of Manchester’s largest employers, is to stay within Manchester City Centre after all, when it relocates its offices. Previously it had been looking for a new location across Greater Manchester, although it never ruled out staying in the centre. It wants to leave its present site at Corporation Street on the grounds of cost, Egi reports today.

Court dress

2008-05-13T08:58:00.000+01:00

The judiciary’s new robes are out. They went on show at the Royal Courts of Justice yesterday, The Lawyer reports. For civil work, no wigs, no wing collars, no bands. Just a long black gown, with coloured flashes on the breast to indicate rank. Suitable for any figure...

I think I rather like them. See them on your Judges from 1st October.

Apology

2008-05-02T07:26:00.003+01:00

Things have been unusually busy the last few days and I apologise to regular readers for not having been able to update this blog for some days. Normal service will be resumed shortly.

Printworks works

2008-04-21T16:49:00.000+01:00

Davis Coffer Lyons and Tushingham Moore have been appointed to re-position The Printworks in Manchester, EGi reports. Resolution bought the leisure scheme last year. Talks have started with bowling, club and restaurant operators, and there will some restructuring.

Amount of security for costs against receivers

2008-04-21T09:37:00.002+01:00

A company in administrative receivership, acting by its receivers, sued for specific performance of a contract for sale and failed because all its terms were not in writing. The successful defendant knew all along the company was insolvent, but had not made an application for security for costs because he knew substantial sums had been realised in the receivership, and thought his costs would be paid out of monies held by the receivers.

When he realized the truth he applied for an order that receivers should pay (under s. 51(3) Supreme Court Act 1981). The Court declined.

1. Making a third party costs order required some exceptional circumstance, and there weren’t any
2. No-one said the receivers had acted improperly or unreasonably
3. Neither they nor the bank had funded or substantially controlled the proceedings or was to benefit from them
4. Since the company was not being wound up the receivers were its agents, and it alone was responsible for their acts
5. The defendant could have sought security for costs.

His appeal was dismissed. The Judge’s reasoning was correct. Aiden Shipping Co Ltd v Interbulk Ltd, The Vimeira (No 2) [1986] 2 All ER 409 considered. There was no justification for creating a rule that receivers should be personally responsible for the costs of a successful party, and it an order were made in this case, it would have to be made in virtually all such cases.
Usefully, the court observed that where the receiver has the money, the court should be robust and (in appropriate cases) order security for the full amount of standard costs expected.

The case is reported by LexisNexis and is called Dolphin Quays Developments Ltd v Mills [2008] EWCA Civ 385.

Personal note

2008-04-18T10:20:00.002+01:00

I am pleased to say that yesterday I passed the peer interview of the Chartered Institute of Arbitrators and (subject to the formalities) have become a Fellow of the Institute. Coupled with my status as a Registered Mediator with CEDR, this makes a good combination of ADR qualifications and skills to go with my litigation practice at the Bar.

Arbitral appeal

2008-04-16T08:48:00.000+01:00

In Royal and Sun Alliance v BAE Systems [2008] All ER (D) 189, the Court of Appeal has held that the effect of s. 69(2) Arbitration Act 1996 is that permission to appeal is not required if the parties to the arbitration have agreed that an appeal on a point of law could be brought.

It is not a question of contracting out of a statutory requirement: s. 69 only requires leave where the parties have not agreed that there can be an appeal on a point of law.

Fastest house price fall

2008-04-15T10:19:00.002+01:00

78.5% more surveyors said house prices fell in March than that they increased, according to the RICS. It was 65.7% last month. House prices are said to be falling at their fastest rate since records began 30 years ago.

I wonder if Gordon Brown's talks with mortgage lenders today will make much difference.

Knight Frank

2008-04-15T10:02:00.000+01:00

Andy Finch, previously of Hambro Countrywide and DTZ Residential, among others, has joined Knight Frank's residential division in its Manchester office as partner and head of residential sales.

Hammonds promotions

2008-04-15T09:58:00.003+01:00

In its record beaking round of promotions, Hammonds has made 19 associates up to partners, including 3 in Manchester, of whom one, Stelios Coutsavlis, is a property practitioner. In fact, property did rather well over all, The Lawyer reports.

Eddisons buys Erinaceous

2008-04-15T09:30:00.000+01:00

Most of Erinaceous, which went in to administration yesterday, has been bought by Leeds-based Eddisons for £1, EGi reports.

Eddisons has acquired the assets of the property management, facilities management and landlord and tenant teams, and transfer is intended to be seamless.

Ironically, there was a time when Erinaceous was interested in buying Eddisons.

Erinaceous in administration

2008-04-14T16:16:00.000+01:00

Egi reports that Erinaceous, the commercial and residential facilities management company, has been forced into administration. It has appointed James Tucker and Myles Halley, both partners in KPMG, with immediate effect. Its shares were suspended from trading this morning pending the announcement.

The Residential Management division and Property Maintenance division are excluded from the administration and continue to trade as normal.

Liverpool One overruns

2008-04-14T09:54:00.001+01:00

The Telegraph reports that Grosvenor is expected to make further financial provisions as a result of cost overruns for its Liverpool One project in results due out today. £140m provisions were made last year.

Metquarter buoyant

2008-04-11T14:34:00.001+01:00

The Metquarter in Liverpool is buoyant ahead of the first phase opening of Grosvenor’s Liverpool One scheme on 29th May, EGi reports.

There is a 26% increase in like-for-like sales in February this year; and footfall is up 10%.

That will please the owners, Alanis Capital and Anglo Irish Bank, and speaks well of the developers, Milligan.

Consultation on radical land law shake-up

2008-04-08T09:48:00.001+01:00

The Law Commission is consulting on reforms to the law of covenants, easements and profits. The paper does not however examine rights to light or rights of support specifically, despite practitioners' concerns.

The Commission's provisional view is that comprehensive reform is long overdue. It wants to modernise and simplify the law, and so far as practicable make for consistency within and between the three types of right.

The paper asks whether the requirement that an easement have a dominant tenement is necessary; and it considers the "ouster principle" (concerning parking rights in particular) in the light of Moncrieff v Jamieson [2007] UKHL 42 [2007] 1 WLR 2620. It refers to the complexity involved in having 3 different systems (common law, by lost modern grant and under the Prescription Act 1832), and different ways of acquiring them (express grant or reservation, prescription and implication). It considers the difficulties over abandonment.

As to covenants, the fact that the burden of positive covenants cannot run, and the technical nature of the requirements passing of the burden of negative ones (never mind the benefit) cause problems.

Section 84(1) Law of Property Act 1925 allows the Lands Tribunal to discharge and modify restrictive covenants: the Commission provisionally proposes it should also allow the discharge and modification of easements, profits and land obligations. Responses are sought before 30 June. See www.lawcom.gov.uk.

No rectification for legal mistakes

2008-04-07T10:19:00.001+01:00

Rectification is not available to make a binding contract where the parties had expressly agreed to leave some terms out, but had made a mistake as to the legal effect of doing so.

The Appellant agreed to sell leasehold premises to the Respondent. The first document set out R’s agreement to pay the price. R was concerned that it did not set out the apportionment of that price between the lease, the fixtures and fittings and goodwill, or set out what was to be done about trading stock, so a second document was drawn up which did that.

There was a dispute over completion, and A registered a unilateral notice, which R applied to cancel.

The adjudicator held that the first document had not contained all the terms agreed, and fell foul of s.2 Law of Property (Miscellaneous Provisions) Act 1989; but it could not be rectified as it there had been no mistake as to the terms it was to contain. So A had no contract and his unilateral notice had to be cancelled.

On appeal, the Court held that rectification was not available where the parties had executed the document they intended to execute and the mistake was as to the legal consequences of that document; so the appeal failed. The case is Ali Oun v Ashfaq Ahmad [2008] EWHC 545 (Ch).

EPC joy

2008-04-07T10:01:00.000+01:00

Yesterday new regulations took effect requiring Energy Performance Certificates (“EPCs”) to be obtained. EPCs are valid for 10 years once issued. They come with a recommendation report which suggests improvements for energy performance.

Construction sale or rent of large commercial buildings comes first. Smaller ones come under the regulations on 1st July 2008. Everything else including dwellings (but subject to certain exceptions) comes under them on 1st October 2008.

If a building is being built, it is the person carrying out the work who must obtain the EPC. If it is being sold or let it is up to the seller or landlord.

The EPC has to be given to the prospective buyer or tenant free of charge; though it may cost a good deal to obtain, depending on the size of the building.

UK big boys

2008-04-07T09:48:00.001+01:00

The Times today reports a rumour that Aldar, based in Abu Dhabi, is looking at Hammerson, Land Securities and British Land. Aldar has confirmed that it is looking at the UK. The suggestion is that Hammerson may be the best fit.

Chesterfield ground

2008-04-03T09:18:00.001+01:00

EGi reports that Chesterfield Football Club, Tesco, and Wilson Bowden Developments have submitted a planning application for a 22-acre mixed-use development which will include a new football ground a the former Demaglass manufacturing site. If permission is granted, construction is scheduled to start in early 2009.

Punch M & B

2008-03-31T09:55:00.002+01:00

Punch Taverns' merger with Mitchells and Butlers is off -- the proposal has been withdrawn, according to the FT.

However, Punch is still considering proposals to do a deal alongside third parties, and there has been interest from private equity.

Deposit discretion

2008-03-27T08:27:00.002Z

Continuing a bit of a run of cases on the return of deposits and s.49(2) Law of Property Act 1925, Lawtel reports that Floyd J has held in Chief Ajibola Anthony Aribisala v St James Homes (Grosvenor Dock) Ltd [2008] EWHC 456 (Ch) that in exercising the discretion it was relevant how close the purchaser had got to completing, and what alternatives he had suggested and how they compared with performance of the contractual terms.

If he could not perform or offer any alternative he would normally lose the deposit: Omar v El- Wakil [2001] EWCA Civ 1090.

Just because the vendor had not proved any loss did not mean the deposit should be returned.

The financial impact on the vendor was relevant, but just because the value of the property had increased in the meantime it did not mean the deposit should be returned: Tennaro v Majorarch [2003] EWHC 2601.

In this case,
· the deposit was only 10%
· it was not in fact a large proportion of the purchaser’s assets
· he knew he had to raise the finance by the completion date or risk losing the deposit, but he did not apply for extra funds until after the completion date
· his efforts to raise the money were only made after the deposit had been forfeited,
· he never offered the vendor terms as good as it could get elsewhere
· the vendor’s profit on re-sale was relevant, but not enough on its own.

Confidentiality and arbitration

2008-03-26T08:35:00.001Z

An important Court of Appeal case on confidentiality in arbitration: Emmott v Michael Wilson Partners Ltd [2008] EWCA Civ 184.

Confidentiality of arbitrations and arbitration materials is a “substantive rule of arbitration law” and the Court will guard it with vigour.

There are established exceptions, however:
· Where the parties consent
· Where disclosure is necessary for the protection of the legitimate interests of an arbitrating party
· Where the court permits it; and
· where the interests of justice require it.

In this case, the Court of Appeal concluded that the last exception applied to the interests of justice in other jurisdictions as well as England.

Allegations of fraud had been made in various jurisdictions, including New South Wales and the British Virgin Islands. There was also an arbitration in London. The fraud claim was also made in the arbitration, but then abandoned. The Court allowed disclosure of certain documents from the arbitration in order to prevent the Courts in other jurisdictions from being misled about the fraud claim.

The court also stated that the correct forum for raising issues over confidentiality in the arbitration will usually be the arbitration itself; and the Court should be involved only a stranger to the arbitration is involved, or the arbitration had come to an end.

Peel buys Pinewood

2008-03-25T11:29:00.001Z

The Financial Times reported last week that Peel Holdings doubled its stake in Pinewood Shepperton to over 20%.

There is talk of a potential bid to take Pinewood private when the price is right.

JJB takes space in SEGRO park

2008-03-25T11:22:00.000Z

EGi reports that JJB Sports is taking a 100,000 sq ft unit at SEGRO’s Heywood Distribution Park in Greater Manchester on a one-year lease.

The space is needed for temporary storage of older products being removed from shelves for onward transfer into “clearance stores”, as part of a revamping operation.

King Sturge, which is joint agent with Savills on the scheme, sorted the whole thing out within a short timescale.

Bellway profit figures

2008-03-25T10:54:00.001Z

The Times reports that Bellway is expected to announce interim pre-tax profits of £94m tomorrow. The figure was £107.8m last time, reflecting the downturn in house sales.

Possession and right to buy alternative accommodation

2008-03-17T08:13:00.001Z

It is not unreasonable to make a possession order against a secure tenant who has been offered otherwise suitable alternative accommodation because she would lose her right to buy her current home, where she would have the right to buy the alternative accommodation instead: Manchester City Council v Dawn Benjamin [2008] EWCA Civ 189.

Exchange Chambers Property Law Conference

2008-03-14T09:03:00.001Z

Exchange Chambers
would like to invite Solicitors & Surveyors to a
Property Law Conference

“Sharing the Pain, Keeping the Gain”
At the Lowry Hotel, Manchester on Thursday 5th June 2008
Accredited with 5 CPD hours

Topics to be covered:
Dealing with tenant default
Insolvency - recovery in adversity
Property valuation in a fluctuating market - what are we paying for?
Developers’ toolkit - can we build it? Yes we can!
Case law & legislation update - where are we now?
Professional negligence - watching the watchers

Dilapidations - delivering best outcomes
Mortgage default - where’s my money?

Contact
campbell@exchangechambers.co.uk

Land bank levy proposal

2008-03-12T09:57:00.001Z

The Royal Town Planning Institute has called for a land bank levy to be introduced in the budget this week to stop developers “manipulating” the property market. It is to discourage developers from putting off building schemes for which they already have planning permission until the market offers larger returns.

It says there is enough land banked for 225,000 new homes, but number of homes being started by developers in January fell by 39%. Reference was apparently made to ‘cynical manipulation’ of the market.

I say nationalise and redistribute. We’ve seen it work so well elsewhere.

Bank of Ireland appointment in northwest

2008-03-11T12:42:00.001Z

The former regional head of property finance at the Bank of Ireland, Ciaran McGivern, has been promoted to regional director for the North West, based in both Liverpool and Manchester, EGi reports today.

Man U v al Qaeda

2008-03-11T07:46:00.002Z

We live in very odd times.

EGi reports that Manchester United football club is negotiating the purchase of the 65-year lease of the 26-acre Manchester International Freight Terminal at Trafford Park at £10.7m, not for development purposes, nor for commercial rents, but to prevent Al Qaeda launching mortars into a stadium full of 77,000 fans.

Is this folie de grandeur, or is something else going on? Or is this just how things are now?

David Wilson Homes in Bridgewater Place

2008-03-07T08:52:00.000Z

EGi reports today that David Wilson Homes has taken 12,500 sq ft in the second phase of MEPC’s 250,000 sq ft Bridgewater Place element of the Birchwood Park scheme, Warrington. WHR and King Sturge are the letting agents.

Tactical first refusal

2008-03-06T08:29:00.001Z

This case has to do with the tactical use of the tenant’s right of first refusal.

The landlord transferred away a number of garages in a separate block, an equipment room, a caretaker's office and an electricity sub-station, together with certain easements and appurtenant rights.

Then he granted a lease of the airspace about the roof of the main building, the light well, the basement rooms and a small area at the rear of the building. That was with a view to the development of the roof space by building more flats.

The flat tenants did not want more flats and tried to exercise their right of first refusal.
The Court held that although "appurtenances" was to be given a wide meaning, the tenants' rights only applied to land which was enjoyed with the actual building itself: Denetower v Toop [1991] 1 WLR 945.

Not all the property transferred was appurtenant to the main building, so it was outside the Act.
All the property under the lease fell within the Act, though, so the tenants were entitled to first refusal on that, thus thwarting the landlord’s plans.

The case was Dartmouth Court Blackheath v Berisworth [2008] EWHC 350 (Ch).

Refinancing gloom

2008-03-04T09:40:00.003Z

The Telegraph reports Susan Geddes, head of estate finance at Abbey, as saying that about one fifth of the UK’s £200bn property loan book is due to be refinanced in the current year.

She predicts that some banks would have to reject refinancing requests, even from well-established property investors, and that, as lenders reduce their exposure to property, refinancing may not be easy for anyone.

Pretty vacant

2008-03-04T07:48:00.001Z

April Fool's Day brings in the government’s changes to empty property rates.

From that date, factories and warehouses are liable to full rates if they have been vacant for six months. Other vacant properties will pay full rates after three months.

Limitation and transactions at an undervalue

2008-02-29T08:25:00.002Z

Section 32 Limitation Act 1981 can save a claim to set aside a transaction at an undervalue which would be statute barred under the general 12-year limitation period for such claims: Giles v Rhind [2008] EWCA Civ 118, CA.

Section 423 Insolvency Act 1986 says the Court can make an order to restore the position where a person has entered into a transaction at an undervalue in certain circumstances.

The normal limitation period for such claims is 12 years. But section 32 says that if any fact relevant to the plaintiff's right of action has been deliberately concealed from him by the defendant, time does not start running until the plaintiff has discovered the concealment or could with reasonable diligence have discovered it. And deliberate commission of a breach of duty when it is unlikely to be discovered for some time amounts to deliberate concealment of the facts involved in that breach of duty.

Here, there was a deed purporting to split the equity in a property 80:20 between husband and wife. That meant only 20% was available to the husband’s creditor. The creditor sought to set it aside as a transaction at an undervalue. He was outside the ordinary limitation period, so he relied on s.32.

The trouble was, s.32 does not actually impose any duties; and there was no active concealment.

The Court got round the problem. It said that though ‘breach of duty' in s 32 did not include just any legal wrongdoing, and there had to be a legal wrongdoing that could be raised in an action, s.423 did give a right to relief which could be raised in an action, and that was enough. And 'concealed just referred to something that was actually hidden from view, so active concealment was not required.

The creditor won. He often does. The case will go wider than insolvency though.

Liverpool Manchester Maglev

2008-02-27T12:23:00.002Z

UK Ultraspeed will announce in Milan today that the Mersey Partnership has provided funding to develop its plans for a high-speed magnetic levitation rail link between Liverpool and Manchester, according to the FT.

A lovely idea, especially given that the estimated journey time, according to UK Ultraspeed’s Wikipedia entry, is 10 minutes.

SDLT on SPVs

2008-02-26T16:24:00.002Z

Simon Hardwick, partner at Halliwells solicitors, is reported as suspecting that the government may be using a recent consultation exercise on the proposal to charge 4% SDLT on disposals of shares in special purpose vehicles holding residential assets of £1m and over as a stalking horse for doing the same to SPVs holding commercial property.

The thinking is that the revenue from SPVs with residential holdings would pretty small; but if the charge applied to commercial property SPVs, it could seriously affect the whole sector.

I can’t imagine a sneaky tax grab from this Government, though, can you?

Casino losses

2008-02-26T09:25:00.001Z

Manchester’s supercasino is a dead duck, the culture secretary is expected to announce today.

16 new large casinos in Great Yarmouth, Kingston-upon-Hull, Middlesbrough, Leeds, Newham, Milton Keynes, Solihull and Southampton will get the go ahead.

So will small casinos in Bath and Somerset, Dumfries and Galloway, East Lindsey, in Lincolnshire, Luton, Swansea, Scarborough, Torbay and Wolverhampton.

Manchester and Blackpool will have to be consoled by regeneration packages; but Manchester City Council is reserving its legal position, so there could be trouble ahead.

Mortgage fraud and civil recovery

2008-02-25T07:55:00.003Z

Against the background of the recent announcement that the FSA would be targeting mortgage fraud, it is interesting to see how the Court approaches it.

In Olubitan v Director of the Assets Recovery Agency [2008] EWCA Civ 104, the Court of Appeal was dealing wit an appeal against a civil recovery order against two properties. The allegation was that the unlawful conduct of A1 and A2 was mortgage fraud, conspiracy to defraud and money laundering, leading to the purchase of property, or creating the funds from which property was purchased. A1 pleaded guilty on a concession for the purpose of sentence only that he had only joined the conspiracy on the day of his arrest. A civil recovery order was made over one property bought in the name of A1, which was let out, on the basis that no evidence of a lawful source of the funds used to purchase it; and over another (where he lived with A2 and their children), on the basis that A2 had obtained a mortgage in respect of the second property by fraud and that A1 was the source of funds which A2 had contributed to its purchase.

It was held on appeal that
(1) The director did not have to allege the commission of any specific criminal offence, provided there was enough detail of the particular kind or kinds of unlawful conduct relied on
(2) The director was not the same as the Crown as prosecutor, so he was not bound by the prosecution concession
(3) The Court need not find a direct link with any offence, but only a causal connection with criminal conduct of the kinds relied on.
(4) In relation to the second property, Parliament did not intend that, where a property was acquired partly with untainted money and partly with tainted money, the purchaser should be deprived of the portion of the value of the property derived from untainted money.
(5) The argument that mortgage fraud did not result in recoverable property at all, because the fraudster never obtained any property in the purchase money (which passed to the vendor on completion) was wrong: it did not matter if the mortgage moneys did not actually pass through the hands of the borrower.

To my mind these last two points are the interesting ones, and I note that Carnwarth LJ dissented in part.

Commercial property environment code

2008-02-22T10:29:00.001Z

According to today’s FT, an environment code addressed to the harm caused by commercial property is to be launched on Tuesday at City Hall.

The code, which is intended to provide a single international benchmark to assess the impact of buildings on the environment, is being launched by Investment Property Databank, CB Richard Ellis and Bureau Veritas, and has the support of the CBI, the RICS, Barclays and BP.

Limitation in favour of the Crown

2008-02-21T08:33:00.002Z

In Roberts v Crown Estate Commissioners [2008] EWCA Civ 98, the Claimant bought the Lordship of Magor and on that basis asserted title over parts of the adjoining foreshore and bed of the tidal estuary of the River Severn on its Welsh side, claiming that the manor’s paper title dated back to the law applicable in the Marches of Wales following the conquest of the Principality of Wales by Edward I in 1282. The Crown Estate Commissioners asserted that the Crown owned the foreshore and river bed by ancient prerogative right, alternatively by adverse possession.

Adverse possession was tried as a preliminary issue on the assumption the Claimant had paper
title. At first instance the Court accepted that the Crown, had the same rights as its subjects under the Limitation Act 1980, and that the nature of the possession was irrelevant. The Crown won and the Claimant appealed.

He said the Crown could not acquire title by adverse possession against a subject except where its original entry on to the subject's land, by its servants or agents, was lawful: because the Crown could not commit a wrong against one of its subjects, it could not base a claim to title by adverse possession on its dispossession of the subject's land. That was the corollary of the principle that a subject could not bring an action for ejectment claiming that the Crown had disseised him of his land. He argued this was based on a fundamental constitutional principle, which the last 400 years of statutes of limitation, and the Crown Proceedings Act 1947, had not removed.

The Court of Appeal dismissed the appeal. The Limitation Acts had been made for purposes which applied as much to the Crown as to its subjects. Even if the position might have been different at some remote period (which would be surprising, because the Crown was usually treated as a favoured litigant), modern Limitations Acts had put the matter beyond doubt.

Wrather buys Arkwright House

2008-02-20T17:19:00.000Z

Wrather Group has bought Arkwright House on Parsonage Gardens, off Deansgate in Manchester for £18.5m. It is expected fully to refurbish the building with a view to rental uplifts.

Personal note

2008-02-20T14:44:00.004Z

I am pleased to say I have just learned I have passed the award writing examination of the Chartered Institute of Arbitrators and will be eligible for Fellowship of the Institute after a successful interview.

Construction to be SWaMPed

2008-02-20T08:37:00.001Z

The amended version of the Site Waste Management Plans Regulations 2008, which will require a SWMP for works involving construction, demolition or excavation above £300,000 should be out shortly, and are expected to be brought into force on 6th April 2008 under the Clean Neighbourhoods and Environment Act 2005. The Regulations will relate only to England.

The maximum penalty for non-compliance will now be £50,000 and there will not be custodial penalties. Reporting requirements will be reduced from what was originally proposed, or removed entirely.

There will be an amnesty for projects where construction work is planned before 6th April 2008 and commences before 1st July 2008.

Terrace Hill arrives in the north west

2008-02-19T07:44:00.001Z

Following a competitive tendering process, Stockport Council has appointed the Terrace Hill property group for its first development in the north west, a new high-quality 270,000 sq ft business park at the former Gorsey Bank housing estate in Cheadle Heath in Greater Manchester.

Jones Lang LaSalle advised.

Terrace Hill arrives in the north west

2008-02-19T07:11:00.000Z

Following a competitive tendering process, Stockport Council has appointed the Terrace Hill property group for its first development in the north west, a new high-quality 270,000 sq ft business park at the former Gorsey Bank housing estate near Cheadle Hulme in Greater Manchester.

Jones Lang LaSalle advised.

The Quarter

2008-02-19T06:55:00.001Z

The Quarter, on Liverpool’s waterfront, a joint venture development of Vermont Developments and Ethel Austin, is to have a 173-room Ramada hotel, operated by Corinthia Hotels of Malta.

Energy efficiency and the two-tier market

2008-02-15T16:50:00.003Z

Jones Lang LaSalle have put out what sounds like a fascinating report on the effect of the implementation of the EU’s Energy Performance of Buildings Directive (EPBD) in 2009. The EPBD aims substantially to reduce emissions by increasing the energy efficiency of buildings.

Buildings over 5 years old will be particularly affected. Owners will have to work out what needs to be done (which may be different in different countries) and refurbish or sell. That is going to take planning. Further, Jones Lang LaSalle think a two tier market may develop, distinguishing energy efficient buildings from those with poor ratings.

Last November Jones Lang LaSalle bought privately-held Upstream, a British firm that advises clients how to develop and operate their businesses in a more environmentally friendly manner.

Developer sought

2008-02-15T16:31:00.000Z

Egi reports that English Partnerships and Liverpool Vision are seeking developers for two Liverpool waterfront sites, either side of the main entrance to the 36-acre Kings Waterfront site, to the south of the Albert Dock.

One site overlooks Wapping Dock and has outline planning permission for 37 flats with a 5,500 sq ft commercial unit. The other overlooks Queens Dock and has outline permission for a 105,000 sq ft commercial building, though hotel use would also be considered.

Liverpool Tribeca

2008-02-14T17:37:00.000Z

The development of Liverpool continues apace, with the announcement of Urban Splash’s plans for a 5-acre mixed-use development on Great George Street in the city centre, which it has named Tribeca. It is to be Liverpool’s largest city centre residential scheme so far.

New York in Manchester

2008-02-14T11:49:00.001Z

The Bank of New York Mellon is looking to expand in Manchester.

It has shortlisted 40 Spring Gardens, Belvedere on Booth Street, and 3 Hardman Street at Spinningfields.

Adverse possession is ordinary

2008-02-14T11:25:00.001Z

A mortgagee in exclusive possession of mortgaged property for more than 12 years after the limitation period began to run, was in 'adverse possession' of it for the purposes of the 1980 Act. The Court of Appeal held in Ashe v National Westminster Bank [2008] EWCA Civ 55 that what counts as adverse for these purposes does not depend on the nature of the possession but the capacity of the person in possession.

The bank argued that J A Pye (Oxford) Ltd v Graham [2002] 3 All ER 865 meant that 'adverse possession', meant possession ‘as of wrong’, or without right, or without the consent of the true owner. It said that time did not begin to run against a mortgagee unless and until the mortgagor's right to possession had terminated or the mortgagor was in possession without the mortgagee’s consent (e.g. when the mortgagee demanded possession or started possession proceedings).

The Court disagreed. It held that ordinary possession of land was adverse possession. The mortgagee’s possession was referable to his own registered legal title to the property, not the bank's title to the property. The true nature of the transaction was that the legal charge was given as security and the mortgagee was to remain in possession of the property which was, in substance, his.

The bank's right of action to recover the property arose on the granting of the legal charge. The right was treated as having accrued afresh when a payment in respect of it was made. Here, the bank’s right of action had accrued over 12 years ago. The mortgagee’s continued possession of the property with the apparent permission of the bank did not prevent him from being a person against whom the right had accrued. Nor did it prevent time from running in his favour. The bank's claim was statute-barred.

Punch merger

2008-02-14T10:51:00.000Z

The papers report today that QVT has raised its stake in Punch to 7 % in the hope of derailing the proposed merger with Mitchells and Butlers.

Unintended secure tenancy

2008-02-14T10:45:00.000Z

The Court of Appeal has held that a licence of one dwelling which both parties intended to be temporary, pending the outcome of possession proceedings in relation to other premises, had nonetheless created a secure tenancy within s.79 Housing Act 1985. The case is Langridge v Mansfield District Council [2008] All ER (D) 180 (Feb).

Premises are whole block

2008-02-07T12:12:00.000Z

The House of Lords has held that "any premises in which the flat is contained" in the Leasehold Reform, Housing and Urban Development Act 1993 s.47(2)(b) means an objectively recognisable physical space.

Here, the whole block of flats was the premises. If a visitor were asked what were the premises in which the flat was contained, he would say the block, and would not further sub-divide the space.

In a single block of flats with several entrances leading to separate staircases, the visitor might also say a block rather than the whole building. It would depend on the facts in each case.

Majorstake Ltd v Curtis [2008] UKHL 10.

Village green: old law new evidence

2008-02-07T12:06:00.000Z

The process under s.14 Commons Registration Act 1965 is a review of what should have been done, in the light of the information available to the court - not an appeal - and new evidence may be admitted.

But a panel hearing an application made under the Commons Registration Act 1965 s.13 should have applied the definition of town or village green applicable under the law at the time of his application, not as it became after the hearing but before the panel made its decision: the presumption against retrospectivity applies.

Betterment Properties (Weymouth) Ltd v Dorset County Council [2008] EWCA Civ 22, CA

Waiver of forfeiture

2008-02-07T11:58:00.000Z

Although an unqualified demand for future rent would operate as a waiver of the right to forfeit a lease, if the letters make it clear that it is only on payment of the rent that the landlord will accept the tenancy as continuing, they do not waive the right.

Relief against forfeiture was refused on the ground, principally, that there had been wilful bad behaviour, and the tenant had sought to make himself unamenable to the order of the court or any enforcement process: Greenwood Reversions Ltd v World Environment Foundation [2008] EWCA Civ 47, CA.

Zip sale

2008-02-06T16:12:00.000Z

EGi reports that YKK, the zip manufacturer, has sold its 180,000 sq ft factory building at Whitehouse Vale Industrial Estate, Runcorn, Cheshire, to local investor Regal Estates for around £3m. There will be a £2m refurbishment. Davies Harrison advised YKK, and will be letting the new scheme.

Important House of Lords case on adverse possession

2008-02-05T09:03:00.000Z

There has been an important House of Lords case on adverse possession on 29th January: Ofulue v Bossert [2008] EWCA Civ 7 . These are the main points.

1.The ECHR had held in JA Pye (Oxford) v UK that the Limitation Act provisions on adverse possession complied with the European convention. Special circumstances would be required to justify departing form that decision: R (on the application of Ullah) v Special Adjudicator [2004] 2 AC 323. There were none: especially where the claimants had slept on their right in any event.

2.An adverse possessor only has to show that he has possession without consent and intends to possess: JA Pye (Oxford) v Graham [2003] 1 AC 419. A person wrongly believing he is a tenant might do so.

3.Proceedings for possession only stop time running for the purpose of those proceedings.

4.To stop time running, an acknowledgment of title has to be an acknowledgment of the relevant title: here, of the true owner’s having the better right to possession.

5.An acknowledgment which would otherwise have been effective to stop time running could not be relied upon if it amounted to an offer to resolve an ongoing dispute and was therefore made without prejudice.

So - forget Human Rights challenges in this area; be careful over disputed tenancies; make sure you pursue your possession proceedings to their conclusion; construe any acknowledgments closely; and don’t be too sure that an offer to purchase made once there is a dispute can be relied on.

All good fun.

Lost deposit and public policy

2008-02-04T10:37:00.000Z

You cannot contract out of your right to relieve against forfeiture of your deposit under s.49(2) Law of Property Act 1925: Aribisala v St James Homes (Grosvenor Dock) Ltd [2007] EWHC 1694 (Ch D).

Section 49(2) confers a jurisdiction on the Court not a right on the parties under the contract. Public policy was engaged and the parties could not contract out.

Just because Parliament had expressly prohibited contracting out in s 146(12) Law of Property Act, it did not mean that, because it had not done so in this one, the parties could contractually exclude it, it was held.

Fair enough. It makes you wonder, though, whether there is any reason why the parties should not be able to bind themselves what to do with the deposit moneys after relief against forfeiture is granted (like pay them back – making an application for relief rather pointless) – so this may have been just a drafting problem really.

Punch / M and B

2008-02-04T10:19:00.000Z

All the papers report today that Punch Taverns has made an all-share offer for Mitchells and Butlers and is expected to make an announcement to the Stock Exchange today under pressure from the Takeover Panel.

Commercial right to buy? House of Lords

2008-02-04T08:34:00.000Z

Do commercial tenants now have the right to buy the freehold?

The effect of a recent House of Lords case may be that some do.

Under the Leasehold Reform Act 1967, a long leaseholder of a house is entitled to acquire the freehold. To amount to a house, premises must be: designed or adapted for living in; and reasonably called a house.

It was held in this case that if the premises were built to be lived in, then even they had later been adapted for mixed, they could still be a “house”. And even they had become so dilapidated that they were incapable of beneficial occupation, they could still be a house.

This may make quite a difference to what I at any rate had previously thought. There are a lot of commercial premises out there which started life as houses.

Boss Holdings v Grosvenor West End Properties [2008] UKHL 5 is the case. My thanks to Cameron McKenna for drawing it to my attention.

Right to buy - service contracts

2008-02-04T08:18:00.000Z

A Court of Appeal case on the exclusion in the Housing Act 1985 Sch.1 para.2(1) from the right to buy legislation for premises occupied in connection with employment: Wragg v Surrey County Council [2008] EWCA Civ 19.

The employees were countryside rangers. It was a condition of their service that they would occupy a property to be provided by the local authority for the better performance of their duties.

The statutory exception contains two separate conditions: that the contract of employment required the employee to occupy the property; and that the requirement was for the better performance of his duties.

The first condition looked only to the terms of the contract.

The second condition raised an issue of fact outside the contract. “For" was to be read as "to enable": the essential question was whether the occupation of the property was both intended to promote, and was in fact reasonably capable of promoting, the better performance of the employee's duties.

"Better" meant that the question was whether the requirement to occupy the house was for the better performance of the employee's duties, as compared with the position if there was no requirement to occupy: it need not be necessary.

The exception applied and the employees did not have the right to buy.

Tenant parking

2008-01-24T08:09:00.000Z

A letter, pending preparation of a new lease, which offered to allow parking for a maximum of 30 minutes, and was accepted and supported by consideration, gave rise to a licence – if the space was clear – to park there, and no more: Picture Warehouse v Cornhill Investments [2008] All ER (D) 133 (Jan).

UK Land & Property in Manchester

2008-01-23T16:30:00.000Z

UK Land & Property, a Liverpool company, has bought its first major property in central Manchester, 76 King Street, from Scottish Widows for over £15m.

Argent for Elisabeth House

2008-01-23T16:28:00.000Z

Argent has been selected by Greater Manchester Property Venture Fund to develop Elisabeth House in St Peter’s Square, Manchester, working to provide up to 350,000 sq in one of the most valuable sites in Manchester.

GVA Grimley advised the pension fund.

Highcross promotion

2008-01-23T12:00:00.000Z

EGi reports that Richard Pellatt, who heads the Northern office of Highcross in Manchester, has been promoted to director.

Variable service charges

2008-01-23T09:19:00.000Z

There is a fascinating decision on variable service charges and the jurisdiction of the leasehold valuation tribunal: Home Group Ltd v Lewis Lands Tribunal (Judge Huskinson) 3/1/2008.
A leasehold valuation tribunal does not have jurisdiction on service charges where the service charge does not vary in accordance with the relevant costs, and accordingly is not a service charge within s. 18 Landlord and Tenant Act 1985.

These were assured non-shorthold tenancy agreements. The rent constituted the net rent and service charge, and could be increased or decreased once a year. The service charge element was calculated by estimating the costs of providing the services for the year - once the overall service charge figure had been set, it did not vary with the actual costs during the year.

So if the actual expenditure exceeded the service charge the landlord absorbed the shortfall; and if the actual expenditure was less, it retained the difference: there was no balancing charge.

It was held that for this reason the sum payable did not vary in accordance with the relevant costs.If the ability to increase the rent on the basis of annual estimated expenditure meant that the service charge was variable, it was hard to see how any relevant tenancy could escape s.18(1), which would make s.14(4) of the Act pointless.

Liverpool Football Club refinancing

2008-01-23T08:49:00.000Z

The FT (www.ft.com) reported yesterday that the US owners of Liverpool Football Club, Tom Hicks and George Gillett, are hoping to finalise a £350m refinancing package with RBS and Wachovia which will include the money for a new stadium.

Luqman seeks compassionate leave

2008-01-22T17:59:00.000Z

Shaid Luqman, who was jailed in 2007 for contempt of court for his failure to assist in the investigation of Lexi’s administrator KPMG into the collapse of Lexi Holdings, is seeking compassionate leave from prison for 5 days to help his wife move out of their Cheshire house, which is being repossessed, EGi reports.

News on local searches

2008-01-22T08:11:00.000Z

The Department for Communities and Local Government has produced guidance on good practice for local authorities (as well as personal searchers) in conducting personal searches of the Local Land Charges Register and of other records.

It refers to the Office of Fair Trading recommendation that local authorities should make available all the unrefined information they hold for Local Enquiries searches on competitive terms.

It also provides an overview of the relevant legislation and the duties of local authorities

It can be found at: http://www.communities.gov.uk/documents/housing/pdf/personalsearchguide.

There is also a joint consultation by the same Department and the Ministry of Justice on proposals for the future of the system including charging structures, and electronic delivery. That is at http://www.communities.gov.uk/documents/housing/pdf/propertysearchesconsultation.

Lawyers and mortgage fraud

2008-01-22T08:06:00.000Z

The current New Law Journal (N.L.J. (2008) Vol.158 No.7304 p. 83) contains an article by two members of Beachcrofts touching on the vulnerability of lawyers to claims by property lenders; the slowdown in the property market; and reports of an upsurge in mortgage fraud.

This is topical stuff, and confirms expectations that the slowdown would expose some of the less salubrious practices in the market’s previous exuberance.

Heatons expands property

2008-01-17T15:25:00.000Z

Heatons property department in Manchester has expanded to include Michael Gouldbourn and Malcolm Glynn from DLA Piper, Raazia Ibrahim from Beachcroft and Simon Baxter from George Davies, LegalMoves (www.legalmoves.co.uk) reports.