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Legal Updates Solicitors Journal Planning Act 2008 - click here for more information Green Leases? The expression ‘Green Leases’ is being mentioned in property circles with increasing frequency. A ‘Green Lease’ is a lease with provisions requiring or encouraging the landlord and tenant to reduce the environmental impact of the property they own or rent. This is a relatively new concept both in the United Kingdom and around the world and has financial consequences which need to be carefully considered as they can have a potentially adverse impact on the parties. Read more... DCLG Consultation Paper "Greater Flexibilty for Planning Permissions" The Government has recently published the above consultation paper to consider whether to introduce a mechanism for extending the time limits for implementation of existing planning permissions and to consider how to implement the procedure for making non material amendments introduced by Section 190 of the Planning Act 2008. It also considers changes to the procedures for applications under Section 73 of the 1990 Planning Act by way of amendment to conditions attached to an existing consent. The consultation period ends on the 13 August 2009 with the intention that the majority of the proposals (subject to the outcome of the consultation exercise) might come into effect from 1 October 2009. Read more... Planning Costs Circular The latest Planning costs circular 03/2009 (the Circular) supersedes the previous cost circular 8/93 and relates to the costs regime in planning appeals and other planning proceedings under the Planning Acts. Read more... The procedure under which all appeals will be determined (written representations, hearings or public inquiry) will be decided by the Planning Inspectorate (by reference to a series of published criteria) thus removing the previous ability of either the Appellant or the LPA to opt for a hearing or public inquiry. Read more... A new Olympic event? 2012 is not just a key date because of the Olympics; it is also the Land Registry’s target date for getting all the land in England and Wales registered. Currently only around 65% of such land is registered so there is still some way to go. Registration is usually only triggered by a sale or charge but the Land Registry will introduce compulsory registration for all remaining parcels of unregistered land in 2012. However, they want people to act sooner and voluntarily register their land - offering a 25% fee discount to try to tempt you! Read more… Top (re)-Gear The overriding objective of most landlords is to improve the investment value of their property. One of the main goals for occupiers is to keep their costs to a minimum, particularly in the short term. In this challenging market, there appear to be very few opportunities for both parties to achieve these objectives. However, an increasing number of tenants are considering 're-gearing' their leases. This can potentially go some way to achieving both of these respective objectives. Read more… Tenant’s Insolvency – Landlord’s Options in Troubled Times With company administrations up 50% in the last year, landlords are anxious to know what they can do if their tenant is next. Under the Insolvency Act 1986 a petition for administration gives rise to a statutory moratorium, which prevents Landlords from pursuing their usual remedies for rent arrears or breaches of covenant. Forfeiture proceedings or any attempt to distrain are permitted only with leave of the court or the consent of the administrator. An additional problem for landlords is that, despite the lease provisions, someone other than the tenant or an approved assignee/undertenant may be allowed to take occupation of the premises without the landlord being given any opportunity to vet them, to object or to place appropriate conditions on their consent. Whilst a tenant going into administration is problematic for landlords, due to the statutory moratorium, the general trend highlighted by some recent cases does give landlords something to be positive about. Furthermore, with prompt investigation of the purposes of the administration and the question of whether there really is a genuine need for a third party company to continue in occupation, a landlord could utilise this general trend in negotiations with the administrator or the third party to boost their position and reach an acceptable compromise. This is especially important in the current climate, as landlords do not want to forfeit leases, since there are few high quality prospective tenants queuing at their doors. Read more… A dead dog? - The demise of CORGI registration From 1 April 2009, CORGI registration will no longer have statutory force. Anyone carrying out work on gas appliances or flues will need to be registered under the new Gas Safe Scheme (“GSS”). A failure to check that an installer is registered under the GSS may amount to a breach of the Building Regulations 2000 and the Gas Safety (Installation and Use) Regulations 1998. In addition, residential landlords should ensure that any regular appliance checks and maintenance are carried out by a GSS registered person to avoid a statutory breach. Use it, don’t lose it - How to Retain Planning Consent If you own land with the benefit of planning permission but, maybe due to market conditions, don’t want to carry out any development now, how can you preserve the consent and ensure it remains effective. This is a particularly tricky area of the law!! Planning consent must be implemented within three years from the date it was granted (unless expressly stated otherwise). It is implemented by the carrying out of a “material operation”. Previously there was some doubt as to whether such works could be carried out simply to keep a consent alive with no intention to actually carry out the development, but recent case law has held that the intention of the person carrying out the work is irrelevant provided the work has been done in accordance with the planning permission. Read more… Watch out for consents needed for transactions with councils On 1 April 2009, the district councils of Cornwall, Durham, Northumberland, Shropshire and Wiltshire and district and county councils in Cheshire will be wound up and dissolved. Their functions, assets and liabilities will be transferred to new unitary councils. In Bedfordshire, from 1 April 2009, Mid Beds DC and South Beds DC will merge with elements of Beds County Council to create Central Bedfordshire Council. The remainder of the county will then be covered by the unitary authorities of Bedford Borough and Luton Borough Councils and Bedfordshire County Council will cease to exist. Directions have been issued which detail the procedure for district councils entering into property transactions prior to dissolution. This procedure generally requires that prior approval is sought. Those entering into a transaction with one of these councils should ensure that any necessary consent has been obtained and produced to them and a copy of it should be retained for future reference. Parking problems A tenant’s rights of renewal under a protected lease do not extend to the renewal of a parking right contained in a supplementary licence. Making money out of thin air! It is commonly assumed that the owner of land owns from the core of the earth up to the heavens but technological advances in aerospace have shattered this view. Airspace is divided into upper and lower strata. Land owners can own the air in the lower stratum but not the higher. Read more… Free parking! The right to park can now exist as an easement so it is no longer necessary to demand that any parking space is included within the demise or the property to be transferred, as a result of the Scottish case of Moncrieff v Jamieson 2007 which applies to the English law on easements. No relief! As of 1 April last year, commercial properties have only been able to benefit from empty rates relief for the first 3 months (6 months for industrial properties) of being empty, after which, full rates become payable. There are exceptions – property held by charities being used for the charity’s purposes, property held by companies in receivership or administration and listed buildings. If the property is un-lettable and incapable of beneficial occupation due to a statutory breach, it is also exempt from empty rates. In the meantime - Interim occupation Where a tenant enters into occupation of premises in anticipation of a new lease completing, what is the status of their occupation? In such a case, the tenant is usually deemed to occupy as a tenant at will or as a licensee. What is better? Both options have their pitfalls for the landlord. The tenant at will could inadvertently acquire statutory protection as a result of the payment of rent converting the tenancy to a periodic one. There is a risk that the tenant’s occupation under a licence could be construed as being under a lease, again attracting the security of tenure of the 1954 Act. Certainly where there is a stand-alone licence authorising exclusive occupancy for a specific term, the case of Street v Mountford would apply and the licence would be construed as a lease regardless of its label. However, as a result of Essex Plan Ltd v Broadminster [1988] 43 EG 84, a proper distinction should be drawn between such a stand-alone arrangement and a licence which authorises occupation as part of a bigger scheme. That said, the line is by no means a clear one! Car parking regulations This case looked at the reasonableness of regulations which controlled parking on an industrial estate. Its outcome is of interest to managing agents and to tenants on estates who wish to challenge parking regulations imposed upon them which they feel are unreasonable. The Court of Appeal held that the question of whether or not a particular regulation was reasonable depended on its terms and not how those terms had come to be arrived at. Forfeiture provisions – some briefs! 1. What can give rise to forfeiture?
2. What potential problems arise for a lender?
3. What steps can be taken to help persuade a lender to accept a lease as security?
For further information please contact Stephen Kay Forfeiture of deposit A and J entered into 2 contracts for the sale of two leasehold properties for a combined price of £2.16m with a 10% deposit. Each contract incorporated standard conditions of sale (4th ed), save that condition 7.5.2 was amended by words purporting to dis-apply s49(2) LPA 1925 which provided that “in any action for the return of a deposit, the court may, if it thinks fit, order the repayment of any deposit.” Unsurprisingly, the Court decided you couldn’t exclude their power by “contracting out”. In any event however, a seller can still sue a buyer and claim damages for loss resulting from the failure to complete. This could cover the difference between the contractual price and the price for which the seller eventually sells together with any additional expenses on the subsequent sale. Read more… Notice to Complete – ready, willing and able? A purchaser sought to recover a substantial deposit because the seller was not ready to complete the transaction and the seller had re-sold the property at a profit anyway so suffered no loss. It was held that where a purchaser is not actually taking steps to complete, a seller is allowed some latitude. Not all documents have to be ready. They are entitled to some time to deal with administrative matters. The buyer argued that the Court should exercise its discretion (under s 49 (2) LPA 1925) to recover their deposit because the seller had made a nice profit on re-sale. However, the Judge made clear that they would only exercise their discretion to recover the deposit in exceptional cases. It would create great uncertainty if recovery of the deposit was dependent on what happened on a re-sale. (Midill (97PL) Limited-v- Park Lane Estates Limited and Gomba [2008] EWHC 18 (Ch), [2008] 03 EG 178 (CS)) The case also went to Appeal where the decision was upheld by the Court of Appeal, Lord Justice Carnwath concluding that,
(Midill (97PL) Limited and (1) Park Lane Estates Limited (2) Gomba International Investments Limited [2008] EWCA Civ 1227) Human rights arguments are increasingly being used in property and planning cases Adverse possession JA Pye (Oxford) v UK 2005 – fact that squatter could obtain land by 12 years uninterrupted possession, without permission of owner, with the requisite intention was exceptionally severe and violated art 1 of protocol 1 to the Convention. It is arguable that the post LRA 2002 rules are HR friendly on basis that paper owner has opportunity to object to the squatter’s claim. However, there is still a question mark over unregistered land. Planning Travellers’ caravans – Couple of cases – Council refused to grant pp to travellers. With appeals pending, Council gave notice of its intention to remove caravans pursuant to s178 of the T&C Planning Act 1990. Travellers argued that action was disproportionate and violated art 8 (respect for private and family life) – ct held council’s decision unlawful as they hadn’t taken account of the likelihood of the appeals being successful and the timescale for the matter to be resolved. Forfeiture and Chancel Repair It is likely that forfeiture will be challenged on HR grounds before long. Some people have even tried to challenge the ability of church to enforce chancel repair on HR grounds! |
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