Our real estate experts bring you the latest property law issues and provide action points to help you and your organisation.
The truth, the whole truth and nothing but the truth
A short but important directive which the defendant in Morrell & Anr v Stewart & Anr [2015] EWHC 962 (Ch) rather overlooked when filling in the information required by the Sellers Property Information Form (SPIF) on the sale of its property and business.
Just why is it so important to be accurate when completing your SPIF?
Key points
- Any material which is misleading or inaccurate can amount to a misrepresentation
- If the court finds that your answers are fraudulent or misleading you could be liable to pay damages to the aggrieved party - and they may be significant
- Even a well drafted contract cannot save you
- And if the boot is on the other foot - make sure that your claim for damages is properly set out - or you could lose out
Background
The claimant (Buyer) bought property, land and a business (kennels and a cattery) from the defendant (Seller).
The Buyer did not have a survey of the property carried out on the basis of the Seller's replies given to questions raised in the SPIF. These replies reassured them that in terms of the condition of the property, there was nothing with which they needed to be concerned. The events that followed illustrated that their trust was unfortunately misplaced.
What did the Seller do wrong?
The house and some of the kennels drained into a septic tank. After the Buyers had moved into the property, they quickly realised that an overflow from the tank was allowing effluent to flow into a dyke on adjacent land, from which it was pumped away. The Buyers had an unpleasant surprise when they were told by the Environment Agency (EA) that the discharge was unlawful and had to stop. Crucially, they were also told that the Sellers had been given a similar warning before the property had changed hands.
Unsurprisingly, the Buyers revisited both the contract and the replies given in the SPIF.
The Seller had confirmed in those replies that there was no documentation relating to any works at the property as, they said, there had been no works undertaken. Similarly, in response to a question specifically asking for information about re-plumbing or recent drainage, the Seller stated that "there ha[d] been no re-plumbing work or testing of the drainage" during their ownership. This reply clearly failed to disclose:
- the defective drainage;
- the requirements of the EA; and
- the work that the Sellers had, in fact, commissioned to try to resolve the problem.
In the business sale agreement, the Sellers gave contractual warranties to the effect that:
- the replies to enquiries given in the SPIF were true in all material respects;
- they had complied with all statutory regulations, legislation and requirements in connection with the running of the business; and
- they had not received any prosecution or warning in relation to any contravention.
The Buyer brought claims for misrepresentation and breach of contract.
What did the Seller say?
The Sellers argued that their replies had been given in good faith. What they said was that they did not think that they needed to disclose the correspondence or meetings with the EA, as they had commissioned works to be carried out to resolve the issues the EA had with the system. In addition, whilst meetings with the EA had taken place, at the time the SPIF was completed, no letter had yet been received by them.
In addition, they tried to rely on provisions incorporated into the contract for the sale and purchase of the property, which said that the Buyer accepted the property in its physical state at the date of exchange of the contract.
What did the court think?
The court was not impressed!
The Seller's defence was not accepted: honest answers to the questions raised would still have required disclosure of the work that had been done, as well as the fact that an EA requirement had been notified to them. In addition, anything which had occurred since the SPIF was completed should have been notified to the Buyer if it had an impact on the original replies given.
Examining the correspondence and taking account of the meetings the Seller had with the EA, the court concluded that the Seller's statements had been made knowing that they were untrue. It was entirely irrelevant that they thought the issue had been dealt with. They were therefore guilty of fraudulent misrepresentation.
Following consideration of the business sale agreement, the court also found that the Sellers were in breach of contract, having given warranties which were 'plainly untrue'.
In relation to the contract provision which purported to exclude liability on the basis that the Buyer accepted the property 'as was', the court said that while that provision might have the effect of excluding a remedy in contract for any defective condition, it did not exclude a remedy in misrepresentation for having induced entry into that contract in the first place.
How was the matter resolved?
The Buyer sought by way of damages the cost of rectifying the drainage problem, by providing a suitable system of waste treatment sufficient to cope with the waste of all the kennels and the cattery, which would satisfy the requirements of the EA. The amount they claimed was £262,350 - a significant proportion of the original purchase price of £320,000.
Unfortunately for the Buyer, but rather less so for the Seller, the basis upon which the damages were sought was flawed and appropriate evidence, directly addressing the correct principles for assessment, was not produced. Ultimately, the court awarded £33,000, highlighting the need for proper pleading of damages and the dangers of parties representing themselves, (as was the case here, despite having taken legal advice earlier in the proceedings).
Comment
Misrepresenting facts in replies to enquiries can be costly. How can you avoid putting a foot wrong?
- When you are giving replies based on your personal experience of a property, even if there is a potential or historic problem, it will be cheaper in the long run to disclose all information requested - whether or not you have already put the problem right.
- When you are completing replies on behalf of your company, make sure you check any company records, and/or those of managing agents, including any acquisition reports and surveys, to ensure that the information you give is complete.
- Avoid saying "not as far as I am aware" - the Buyer may take this as an implied warranty that you have in fact made reasonable enquiries.
- If you are not sure whether information is relevant or not ask your solicitor for advice.
Acting on your own behalf can be tempting, but where large sums are at stake, professional advice should be sought.
Minimum Energy Efficiency Regulations (MEES) - coming, ready or not
Do you own and let out or propose to let out non-domestic* buildings, in England or Wales, with an Energy Performance Certificate (EPC) rating of F or G under the Energy Performance of Buildings Regulations? If so, the MEES Regulations will apply to you and if you have not already started to review your portfolio, now is a good time to do so.
Key points
- Minimum energy rating standards will be imposed on property to be let
- Non-compliance will render letting unlawful
- Landlords face both financial and reputational penalties for breach
- Exemptions may apply
- Higher rating requirements may apply in the future
(*The Regulations also apply to domestic property but how they will be applied in the domestic arena is beyond the scope of this article.)
The Regulations - what they say
After 1 April 2018 landlords of energy inefficient non-domestic private properties will not be able to grant a new tenancy until:
- The requisite energy efficiency improvements have been made; or
- The landlord can show that the Regulations do not apply; or
- The building is exempt from the Regulations.
Significantly, in addition, a landlord may not continue to let any property after 1 April 2023 where the energy performance of the building is deemed to be similarly 'sub-standard'.
Energy performance is sub-standard where the valid EPC (one issued within the last 10 years and which must be the most recent EPC for the property) indicates energy performance below band E.
So, if a building is within bands F or G, you will have a problem in the not too distant future because to be able to let, or continue to let your properties on the requisite dates, you will need to bring energy performance up to at least a band E rating.
Why does it matter to landlords?
The financial implications of compliance with the Regulations could be significant. If your portfolio is carrying sub-standard buildings, possible consequences include:
- Capital outlay: the cost of bringing your buildings up to the required energy performance level;
- Negative impact on rent reviews if the property cannot be sublet;
- Properties becoming less marketable if they are seen as energy inefficient;
- Restricted financing and lending options as lenders look to more sustainable options.
Exemptions
The Regulations will not apply where:
- There are no relevant energy efficiency improvements that can be made.
- An E rating has not been achieved despite all cost-effective works having been carried out (as a guide, if the cost of works is less than the likely energy cost saving over seven years, it will be deemed to be cost-effective).
- Third party consents are necessary (such as mortgagee, tenant, superior landlord or planning consent) and such consent cannot be obtained or only obtained subject to conditions with which it would be unreasonable to expect the landlord to comply.
- Improvement works will result in a net material decrease in a property's capital or rental value (this is currently 5% and the landlord will be required to provide a report in evidence prepared by an independent surveyor).
In addition, there are some buildings which will be excluded from the regime altogether. The Regulations will not apply to buildings which do not require an EPC, such as listed buildings or lettings for less than six months or for 99 years or more.
Getting ready for the Regulations - reviewing your portfolio
It's a good time to start planning for the 2018 and 2023 deadlines. Review your portfolio and identify:
- Any properties with an EPC rating of F or G;
- Which properties (lawfully) do not have EPCs - these may not have to comply, at least initially;
- Any properties with EPC ratings just above the 'E' threshold - stricter assessment criteria in the future may mean that the next EPC won't make the grade.
In addition, consider:
- Forthcoming lease expiries (including break options) to identify the likely trigger point for possible improvement works;
- The impact on lease terms with your legal advisers.
If you don't comply?
If you let, or continue to let, sub-standard properties after the respective deadlines, the government is taking a two-pronged approach in applying sanctions:
- Publication of details of non-compliance in the PRS Exemptions Register (the 'Publication Penalty'); and
- Financial penalties - with fines ranging from £5000 to £150,000 (see table below).
Comment
Although there has been some speculation as to how MEES might operate in the absence of the, now defunct, Green Deal and while undoubtedly there must remain a question mark over the future of MEES for domestic properties, as far as commercial properties are concerned it would be unwise to think that the Regulations will not be operable. Commercial landlords need to be planning now for the 2018 and 2023 deadlines if they are to avoid expensive and potentially damaging sanctions.
Non-domestic rates and occupation of separate floors of a building
Key points
- An occupier carried on its business in premises located on two separate floors in the same building
- The occupier sought to have the two floors treated as a single unit for business rating purposes
- The Supreme Court held that the primary test was geographical, although functional interdependence may sometimes be a factor
- Non-contiguous premises that do not directly intercommunicate, even in the same building, will generally constitute two distinct taxable properties
- In the present case the two floors were separate units for business rating purposes
Background
Woolway v Mazars [2015] UKSC 53 concerned the assessment of business rates in respect of premises where the ratepayer company (Mazars) occupied the non-common areas of the second and sixth floors of a multi-let building under separate leases, with those two floors communicable via an internal lift in the common parts.
The original rating position
Where different parts of an office building are occupied by the same occupier, ordinary valuation practice is generally to enter them as a single unit if they are contiguous (i.e. physically adjacent to each other), but as separate units if they are not. In accordance with this practice, the non-common parts of the two floors occupied by the company were entered in the 2005 rating list as separate rateable units.
History of the proceedings
In 2010, the company successfully applied to the Valuation Tribunal to merge the two floors into a single rating unit, on the basis that while physically separate, they were functionally inter-dependent; in doing so, an allowance for fragmentation of 5% was made. On an appeal by the Valuation Officer, the Upper Tribunal affirmed the decision as to merger but disallowed the fragmentation allowance.
That decision was upheld by the Court of Appeal.
In assessing the rating status of the property, the Court of Appeal held that the correct approach was to treat different floors in common occupation as one single rateable unit, regardless of whether or not all the floors adjoined each other. On the facts the company's occupation of its two floors, albeit physically separated, could not legitimately be distinguished on practical grounds or in terms of the value of the occupation. What was important was to have regard to the practical realities of occupation in a modern office block and the physical relationship between the floors.
In reaching its conclusion, the court rejected the suggested use of a standard formula which would require the floors of a building to form a contiguous physical "cube" and adopted instead a more flexible approach, based on what it regarded as common sense.
While the importance of a geographical test (i.e. that the premises were contained within a single building) was acknowledged, the court considered that the object of such a test would be defeated by disaggregating premises held for a common purpose within the same identifiable building, albeit on separated floors.
The Supreme Court did not agree and reversed the Tribunal's decision.
The tests to be applied
The Supreme Court considered two principles that could be applied in establishing whether premises formed a single unit - geographical (whether the premises are such as to constitute a single unit on a plan) and functional (the use to which the premises may be put).
The court concluded that
- the primary test is geographical - i.e. that the spaces enjoy some characteristic of unity such as contiguity and/or direct intercommunication; but
- two geographically distinct spaces may yet be treated as a single rating unit on functional grounds, where the use of one space is necessary to the effectual enjoyment of the other; and
- such interdependence is established not on the ratepayer's business needs, but on the objectively ascertainable character of the spaces
These principles had to be applied to the facts in a common sense (as opposed to a mechanical) way.
What did the Supreme Court decide?
The Supreme Court considered that the Upper Tribunal had erred in the approach that it took, in coming to the conclusion that the two floors could be treated as one rating unit. In deciding that common occupation for business purposes was sufficient for the two floors to form one rating unit, the Tribunal had neither applied the geographical test, nor the functional test.
While correctly treating as irrelevant the way in which the occupier chose to use the premises together, the Tribunal had also considered that the geographical test should not be applied where separate premises were located in the same building.
Rejecting this approach, the Supreme Court considered that the Tribunal had made an arbitrary distinction between horizontal and vertical separation, unsupported by principle. Leaving one floor of a building and having to use common parts/lifts (over which the company did not enjoy possession) in order to access premises in another part of the building was no different (geographically or functionally) from where a ratepayer leaves a building it occupies and crosses a road (not in its ownership) to another building that it also occupies.
Where spaces in the same building are not contiguous and do not directly intercommunicate, this indicates that the same occupier has two distinct taxable properties, in the same way as if they were on opposite sides of the street.
Accordingly, the premises demised to the company on floors 2 and 6 were to be entered in the rating lists as two separate rating units.
In practice
Unless it can be established that one space is necessary to the effectual enjoyment of the other, businesses occupying separate floors in the same building are likely to find themselves faced with separate rating assessments for each floor.
Depending on the particular circumstances, whether 'split' occupation in this type of situation is treated as a single, rather than two separate, rateable units, may have a significant impact upon the total business rates payable. This decision has financial ramifications for businesses with 'split' occupations in the same building, who may not be able to benefit from fragmentation allowances to reduce their total rates bill.
Although not something the court was called upon to rule in this case, at least one of the judges was of the view that the same result would have been reached even had the two floors been on adjacent floors: the key factor was that the only access between the two floors was through the public part of the building.
Securing relief from forfeiture of a lease
Key points
- The purpose of a re-entry right is security for covenant performance
- Forfeiture is to protect against non-compliance, not an additional penalty for breach
- Relief is likely to be granted where breach remedied and landlord's costs covered
- Wilful breach may not necessarily preclude relief
- Disproportionate loss of value is a relevant factor, but not determinative
Background
Where a tenant is in breach of its covenant obligations, a landlord may re-enter and take possession of the premises and forfeit the lease, on the terms of a forfeiture provision contained in the lease. Forfeiture determines the lease, but the tenant has a right to apply to the court for relief from forfeiture.
The court has a general equitable jurisdiction to grant relief against forfeiture in respect of non-payment of rent; forfeiture for any other breaches are governed by statute (s.146 LPA 1925). Whether relief is granted in any particular circumstances is at the court's discretion
Two recent cases provide useful pointers as to the basis upon which the court might exercise its discretion to grant relief from forfeiture of a lease.
Putting things right: proportionality
In Magnic Ltd v Ul-Hassan & Anor, [2015] EWCA Civ 224 as a result of a takeaway business having been operated at the premises in breach of the lease terms, the landlords forfeited the lease and sought an order for possession against the tenants. A consent order was made requiring remedial action by the tenants and providing that failure to comply would result in the tenants' application for relief from forfeiture being dismissed.
Subsequently, the tenants applied to court for permission to appeal, including a request for an extension of the February 2011 deadline for them to cease trading contained in the original order. The judge granted permission to appeal and made an interim order staying the original order pending such appeal, which was ultimately heard and dismissed on 31 May 2011.
The tenants continued to trade until the appeal dismissal, and the landlord sought to enforce the original possession order on the basis that the requirement to cease trading by February 2011 had not been complied with.
The tenant's solicitors had taken the view that the stay of execution pending appeal was sufficient to extend the February 2011 deadline; the landlord's solicitors contended that a variation of the original order was required to extend the deadline and that the stay simply postponed possession until the appeal had been disposed of, whereupon they were entitled to possession on the terms of the original order.
Notwithstanding arguments that in the absence of relief from forfeiture the landlord would obtain a substantial windfall and the tenant would suffer "catastrophic" loss, compared with little or no prejudice to the landlord if relief were granted, the District Judge declined to grant the tenants further relief.
He considered that the order required trading to cease by the February deadline and that continuance of trading thereafter had been a deliberate decision by the tenants. The possibility of a windfall was something that arose in every forfeiture action and could not therefore be viewed as a significant factor.
The Court of Appeal held that the judge had mischaracterised the situation. The tenants' failure to comply with the condition in the possession order to cease trading had not been deliberate, in the sense that they had been acting under the honest, but mistaken, belief that the time for compliance had been extended by reason of the stay of execution. It was not the tenants' fault that the stay was ineffective to vary the deadline in the original order and their failure to recognise this was excusable. They had not deliberately or consciously disregarded the terms on which relief had been originally granted.
The court considered that it would be disproportionate and unjust for the tenants to be deprived of their property for a legal error of this kind.
A balancing exercise: conduct is not the only factor
In Freifeld & Another v West Kensington Court Ltd [2015] EWCA Civ 806, although a tenant was aware that it required its landlord's consent to do so, it had granted an underlease without obtaining such consent. In the light of the tenant's attitude towards compliance with their lease obligations and their conduct generally, the judge at first instance had refused to grant the tenants relief from forfeiture when the landlord sought to forfeit the lease.
Although the judge considered that he had to take into account that refusing relief may be disproportionate in view of the substantial windfall that would accrue to the landlord as a result of forfeiture, the conduct of the tenants had been such that they faced a "vertiginous but not necessarily impossible climb to the summit of relief" and that having failed even to make preparations "to leave base-camp" in order to do so, relief from forfeiture should not be granted.
In response to this judgment, the tenants sought to rectify matters by procuring a surrender of the unlawful underlease and to take steps to address other matters complained of, including nuisance and noise at the premises.
A new application for relief was made, proposed to be conditional upon the tenants securing an assignment of their lease to a third party within six months, failing which they would surrender their lease. Although concerned at the level of financial benefit accruing to the landlord on forfeiture, the judge refused this new application on the basis that there was no injustice, given the previous unsatisfactory conduct of the tenants.
The Court of Appeal considered that the judge had taken the wrong approach in suggesting that the tenant faced a "vertiginous" climb to reach a point where discretion to grant relief could be given: what the court should be concerned with was that damage suffered by the landlord was made good.
The court held that it was established and accepted that even in the case of deliberate breach, relief may still be granted; it is not necessary to establish special circumstances. Wilfulness of breach is a relevant and (depending on the circumstances) may be a significant consideration but where there is wilful breach it is not the case that relief can only be granted in exceptional circumstances.
In addition, the value of the leasehold interest to be forfeited is also a relevant consideration. Where there is a substantial capital value, the court is entitled to find that it would be disproportionate and unjust for the lease to be forfeited. In assessing this, the tenant's conduct is not relevant to the question of the windfall.
The value of the interest which the landlord may gain as a result of the lease being forfeit was a separate factor to be considered first on its own merits and only then balanced against the tenant's conduct. The estimated value of the head lease here was between £1 million and £2 million.
The Court of Appeal held that the judge at first instance had misdirected himself on these issues and that his decision to decline to order relief from forfeiture could not stand.
Instead, to free the landlord from the prospect of a continuing relationship with an unsatisfactory tenant, the court allowed the tenant's appeal on terms that there should be relief from forfeiture for the purposes of, and conditional upon, sale of the head lease within six months. If the tenants failed to achieve the sale within this timeframe, forfeiture would take effect.
In practice
Whether relief from forfeiture will be granted is always fact-specific and will depend on the circumstances in any particular case, including the conduct of the parties. It is a balancing exercise, taking into account all the relevant circumstances.
Some useful pointers can, however, be drawn from these recent cases:
- the basic purpose of a right of re-entry is to provide the landlord with some security for covenant performance by the tenant
- forfeiture should not operate as an additional penalty for breach, but rather as an ultimate sanction protecting the reversionary interest against unremedied breaches and to secure compliance
- even highly unsatisfactory conduct by the tenant may not necessarily preclude relief and must be weighed in the balance with other relevant factors
- relief can still be granted even though a breach is deliberate and special or exceptional circumstances do not necessarily have to be shown
- if the breach is put right and the landlord's costs are covered, relief from forfeiture is likely to be granted in most cases
However, tenants should not assume that relief from forfeiture is in any way a given. In view of the serious ramifications of a lease being forfeited, tenants should take care to comply with their lease obligations at all times, to avoid finding themselves in the difficult, and perhaps disastrous, position of losing their (possibly highly valuable) leasehold interest.
Restoring a legal charge removed from the register in error
Key points
- Various borrowings secured on a property were recorded in separate bank accounts
- A failure in the bank's internal systems led to outstanding borrowings being overlooked when a discharge was requested
- An e-DS1 form of discharge was provided in the mistaken belief that borrowings had been repaid
- The court exercised its discretion to order re-registration of the lender as proprietor of the charge
- The register was rectified notwithstanding that shortcomings in the bank's systems had contributed to the mistake
Background
In NRAM Plc v Evans & Anor [2015] EWHC 1543 (Ch), borrowers had secured a loan from the bank in 2004 to purchase a property and had executed a charge in favour of the bank, to secure that loan. The charge was also expressed to secure further advances. The borrowers had substantial unsecured borrowings with the bank in other accounts.
Following revised loan arrangements made with the bank in 2005, a new loan was made to the borrowers (which included both the original loan and other borrowings). The 2004 loan was redeemed and all the borrowings consolidated under a new account number.
In 2014, the borrowers instructed solicitors (who it appears had only been given details of the original 2004 loan account) to write to the bank, asking for a DS1 form of discharge in respect of the 2004 loan, on the basis that the loan had been redeemed in 2005 and that the charge should therefore be removed from the register of title for the property.
Correcting the mistake
Due to administrative shortcomings at the bank, the 2004 and 2005 loans had not been linked on the bank's systems, and not appreciating that there was the further (2005) loan still outstanding, the bank provided an e-DS1 to the Land Registry. The entry in respect of the bank's charge was removed from the register of title.
When the mistake subsequently came to light, the bank contacted the solicitors, who stated that they were unaware of the 2005 loan. A unilateral notice was registered against the title to the property to protect the bank's continuing interest.
The court held that the terms of the 2004 charge secured the subsequent 2005 loan. The bank was entitled to have the register of title rectified in its favour and to be re-registered as proprietor of that charge.
However, because the borrowers were in possession as registered proprietors, the register could only be rectified (under s.64/Schedule 4 LRA 2002) where they had contributed to the error through lack of proper care. The court held that the borrowers had contributed to the error as their solicitor's letter requesting discharge referred only to the original 2004 loan and not to the subsequent borrowing which continued to be covered by the charge.
The e-DS1 had been issued not merely inadvertently but, because the bank had made a specific error, in the mistaken belief that the full borrowing secured by the charge had been redeemed. That error had been induced by the borrowers' solicitors' letter.
The inadvertent issue of the e-DS1 had serious consequences in terms of the bank's loss of security. In the circumstances, it was the judge's view that it would be unconscionable for the mistake to be left uncorrected, notwithstanding the bank's lack of care.
In practice
The bank had been careless in not linking the two loans in their systems which led to their failing to appreciate that monies were still secured on the property. However, whether or not to order rectification is at the discretion of the court; and carelessness on the part of the party making the voluntary disposition (here, the discharge) does not of itself prevent such discretion being exercised in its favour.
The bank succeeded in this case but it does not follow that a different set of facts would lead to the same result.
Before issuing discharges, lenders need to be sure that all outstanding monies secured have been repaid. The bank in this case subsequently revised its procedures to ensure that separate loans made at different times secured by the same charge would be clearly linked on its systems.
Equally, those acting for borrowers need to ensure that all relevant lending is properly identified when seeking a discharge.
Planning
National policy on affordable housing requirements quashed
In West Berkshire District Council and Reading Borough Council v Department for Communities and Local Government [2015] EWHC 2222 (Admin), the High Court considered the decision to alter national policy by way of ministerial statement.
The change was to amend the policy relating to s106 planning obligations by introducing exemptions to the need to provide affordable housing for small sites and to allow for a credit to be given where a vacant building is brought back into use. The credit would allow for the floorspace of the building to be off-set against the affordable housing requirement.
On a judicial review sought by the two local authorities, the court found that the decision to change the policy in that way was unlawful. As a result, a large section of the Guidance on s106 obligations was removed within 48 hours of the judgment being given.
The local authorities' main concern was that the exemption for small sites and the vacant building credit would affect the deliverability of affordable housing which would cause the Councils' housing land supply figures to be incorrect.
An application has been made to the Court of Appeal for leave to appeal the decision and for the matter to be expedited. Papers have been submitted and although the matter was originally listed for hearing before 27 October, that date has just been amended to 15 December.
Is it true that the six week time limit for Judicial Review and statutory challenge is strict?
A statutory challenge for planning matters must be brought within six weeks from the date on which the grounds to make the claim arose.
In Wood v Secretary of State for Communities and Local Government and another [2015] EWHC 2368 (Admin), the High Court considered whether it was fair to allow the claimant an extension of time and permission to amend the grounds of his appeal.
The case arose from an enforcement action brought by the Broads Authority. The recipient (W) appealed the issue of the notice and the inspector allowed the appeal in part.
In November 2014 W applied for judicial review (without legal representation) within the six week period but failed to file the papers relating to a statutory challenge under the planning acts. W lodged the grounds of his claim in February 2014 and on 20 March 2015 W filed an application to appeal under the statutory challenge provision of the planning act. W needed the permission of the court to bring the statutory challenge out of time and to amend his grounds of claim.
BA argued that an extension of time would prejudice the public interest in the swift enforcement of planning control. However the court held that there was no significant prejudice and recognised that W was not making an attempt to introduce a late claim or new ground.
Sustainable drainage principles and pre-existing flood risk
In Menston Action Group, R (on the application of) v City of Bradford Metropolitan District Council [2015] EWHC 2292 (Admin), a local action group sought to challenge the decision of the authority to discharge a condition on a planning permission.
The condition required the submission of a surface water drainage scheme based on sustainable drainage principles. The scheme was to include details of how a specified run-off rate would be dealt with.
The group contended that the scheme did not meet sustainable drainage principles, that the authority had misunderstood the condition and in particular, that the authority failed to satisfy itself that the scheme would not make the pre-development flooding situation worse and also had a duty to consider the potential of the scheme to alleviate existing flooding.
The court found that the authority had reached a decision which it was entitled to make and was "well within the scope of reasonable decisions that any local planning authority could reach".
The court rejected the claimant's argument that there is a positive obligation on the part of a developer to consider making improvements. The judgment states:-
"It is clear from the policy advice that there is no basis for imposing what might be an open-ended obligation on the developer to remedy a pre-existing problem in any of the policy that was contemporaneous at the time of either the grant of consent or the discharge of the condition. Only if a pre-existing problem was exacerbated by the development would it be right to impose some liability on a developer and, even then, only such liability that would relate to the degree of exacerbation created by the proposed development so that the test of fairly and reasonably related was met"
NOTE: The Action Group has lodged an application for leave to appeal and a protective costs order. The application is awaiting a judicial decision on the papers but if granted is listed to be heard before 2 November 2015
Newts!
A newt initiative has been published by Natural England which it claims could enhance the population of newts and reduce delays to major building projects.
A pilot project is to be launched to make the licensing system for great crested newts (GCN) more straightforward.
Currently, developers on sites with GCN are required to carry out a survey and assessment before applying to Natural England for a licence to move the GCN before development can commence. This is costly and causes delays because the survey can only be carried out during the GCN active season between February and October.
The pilot project with Woking Borough Council this autumn will involve survey work to establish size location and connectivity of local GCN populations. A new survey technique of testing pond water for newt DNA has already been carried out. The information will be used to produce a conservation plan identifying areas where development will have the least effect on GCN, and will specify where new habitat will be created to ensure a healthy population.
The Council will create the new habitat, so that where development will result in habitat loss, the habitat gains will already exist
However, the publication states that where there are areas of high conservation value for GCN, developers are likely to seek to avoid those areas. This is likely to be of concern to developers with land banks containing a significant GCN population.