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Allotments De-listed as an Asset of Community Value to make way for Development

A tribunal held in the case of New Barrow v Ribble Valley Borough Council that the land listed as an asset of community value (ACV) and used as allotments should be delisted to allow the land to be used as part of a development for new houses.

Land can be registered as an ACV if its use is for the wellbeing or social interest of the local community, and there is a realistic prospect of this use continuing. Planning permission was given to New Barrow for the development of 504 new homes in 2014. The council listed the allotments as an ACV in 2016 after the allotment holders had received termination notices.

Replies to Commercial Property Standard Enquiries (CPSEs)

Replying to commercial property standard enquiries can be frustrating, time consuming and feel purposeless. CPSEs are designed to cover many different scenarios, so there are often questions that do not apply to a given transaction. It is important, however, to take care answering each question and not to provide routine responses as this can have consequences for the seller – read below to find out why.

Why were CPSEs introduced?

Sellers will usually be asked the same enquiries in all transactions, with numerous non-standard questions being asked from different firms of solicitors. CPSEs were introduced in 2002 to help speed up commercial property transactions and streamline the enquiry process. Responding to CPSEs aims to ensure that the buyer has all the information about the property before proceeding with the purchase.

Keeping Your Options Open

With a surge in development being seen across the UK and following the release of the government’s Housing white paper setting out plans to boost the supply of new homes in England, it is perhaps no coincidence that lately we have experienced an increase in the number of enquiries received in relation to land option agreements.

A land option agreement is a contract in which a potential purchaser or developer of land pays the landowner a non-refundable sum of money in return for a legally binding right (but not an obligation) to buy the land on or before a certain date or after certain conditions are met (such as the grant of planning permission).

What does the Snap Election mean for the UK housing market?

Last week Theresa May called for a snap General Election, and her surprise announcement affected markets worldwide. This raises questions as to how the upcoming elections on 8th June affect the UK property industry.

May’s call for a snap election in 2017 will mark the third consecutive year where the British public have been required to vote, following the EU referendum last year and a General Election in May 2016. Homeowners across the UK will be concerned with how instability in the political arena could affect the value of their property. This has also prompted mixed reactions from experts in the industry. Whilst welcoming the potential for a clear government mandate to deliver Brexit, the election could cause a short-term delay in market activity.

Minimum Energy Efficiency Standards Set to Change

There is less than a year to go before changes are brought in which will affect the ability of landlords to let properties with an energy performance certificate (EPC) rating of F and G. From 1 April 2018, landlords of commercial properties will be unable to grant a new lease of such a property, subject to some exemptions and exclusions. Further changes will be brought in on 1 April 2023 where landlords of commercial properties will have to comply with these regulations for existing leases.

Since they were first introduced in 2008, EPC assessments have become much more accurate and the efficiency requirements of properties have been significantly enhanced. There is therefore a risk that the 47% of properties which are currently rated D and E may drop to F or even G and will be caught by these new regulations.

Will Planning Fix Our “broken” Housing Market?

If you ask any house builder about its experience with local authorities and the existing planning system, the chances are that you will get a negative response!

In short, the government’s recent long-awaited Housing White Paper sets out the government’s plans to fix England’s “broken” housing market to intensify house-building by shifting away from the longstanding focus on mass home ownership and towards recognising longer term renting as a genuine alternative to buying a house. It is aimed at reforming the current planning system, rather than overturning it, by encouraging house-builders to build and local planning authorities to permit them, or require them in certain circumstances, to build. It has also proposed a number of incentives to release brownfield land for development, increase housing in urban areas and better utilisation of space where house building is undertaken.

Business Rates

There has been much debate about the changes to business rates that will be coming into force on 1st April 2017. The government announced in the budget that there will be a small package of business rates relief for smaller firms and pubs and also a local authority discretionary fund for hardship to soften the blow. However, many small business owners are still unhappy with the changes as many will see their business rates increase.

Will a Gate Obstructing a Private Right of Way Always Be Actionable in Law?

If there has been a substantial interference with a private right of way then this is actionable in law. The recent case of Kingsgate Development Projects Ltd v Jordan and another [2017] gave further guidance on what amounts to a substantial interference.

In this case, Mr and Mrs Jordan purchased a property over which there was a right of way in favour of the neighbouring property, Kingsgate Farm. When Mr and Mrs Jordan bought the property there was an electric gate at the entrance to the right of way and further along the right of way there was a further gate that was unlocked.

Can You Exclude Reliance on Replies to Pre-Contract Enquiries in a Commercial Property Transaction?

In the case of First Tower Trustees Ltd and another v CDS (Superstores International) Ltd [2017], First Tower, the landlord, proposed to grant a lease of a warehouse to CDS.

As part of the transaction, First Tower completed replies to pre-contract enquiries in which it stated it was not aware of any notices relating to environmental problems and that it has not been notified of any actual, alleged or potential preaches of environmental law but that CDS should satisfy itself. The replies to pre-contract enquiries confirmed that First Tower would notify CDS if it became aware prior to completion that any reply was incorrect.

A Warning to Companies – Sentencing for Environmental Offences

A mushroom packaging company in Evesham was recently prosecuted by the Environment Agency (EA), following reports of pollution of a stream in April and May 2015.

The EA visited the brook on 24 April 2015 and discovered that it was heavily polluted with organic matter, turning black with a foul odour and resulting in low levels of oxygen. As a result many frogs and other invertebrates downstream had been killed by the pollution.

What Will the Impending Business Rates Revaluation Mean for the High Street?

The last revaluation of business rates took place in April 2010 with rates liability calculated at that time on the basis of rental values from April 2008. The usual five-year revaluation pattern would have meant a further revaluation in 2015 (on the back of 2013 rental values), however this was pushed back by two years by the Government citing concerns about the ability of many businesses at that time to cope with potentially “large tax hikes”.

Vacant possession de-mystified

It is a common requirement for a tenant to give up premises with ‘vacant possession’ in order to validly exercise a break option in a lease.  There can be serious financial implications for a tenant who fails to comply, but do most tenants (or indeed landlords) really understand what it entails?

What a relief…

All but the most extraordinary commercial lease will contain a forfeiture provision allowing the landlord to re-enter the property and treat the lease as terminated on the occurrence of certain events (usually non-payment of rent, breach of covenant and possibly insolvency of the tenant). At first glance the remedy of forfeiture can seem draconian as any minor divergence by the tenant from the terms of lease could theoretically result in its termination.

The fickle laws of supply and demand

As the students sample the delights (or otherwise) of freshers week, student accommodation investment specialist, The Mistoria Group, has fanfared the expansion in the North West student population which, they say, has triggered a jump in demand for high quality, shared accommodation.  Their figures claim student demand has risen by 48% year on year, whilst investor demand has soared, 55% year on year.

Defaults under the wider law will not defeat a compensation claim against a local authority following emergency action under the Building Act, but may affect the level of compensation awarded

Local authorities may take emergency action under the Building Act where they consider buildings to be unsafe.  If they do so, people who have suffered damage because of the emergency action may be entitled to compensation from the local authority for the damage caused.  Under the legislation, compensation may only be claimed in relation to a matter as to which those people have not themselves “been in default”.  The Supreme Court decided in the case of Hastings Borough Council v Manolete Partners plc [2016] UKSC 50 last week that the phrase “in default” relates back to the matter which triggered the local authority to take emergency action, not to the general state of the building in question or to the person’s obligations in the wider law.  It went on to find, however, that breaches of responsibility under the wider law will be matters which an arbitrator may take into account when calculating the amount of compensation and may reduce the sum to nil if they are of sufficient importance.

Mark Gillies joins Myerson’s Commercial Property team

Altrincham commercial law firm, Myerson, is delighted to announce that Mark Gillies has joined the firm as a Partner in its Commercial Property department.

Mark joins Myerson from national firm Laytons, where he had been Head of Property in the Manchester office for over 8 years. Mark specialises in property finance and secured lending and has considerable expertise in advising on commercial property acquisitions and disposals.

Finance Bill 2016 – proposed amendments to higher rates of SDLT for additional residential properties.

The higher rates of SDLT for additional residential properties were introduced by the Finance Bill 2006, which was published on 19th May 2016. Subsequently, on 28th June 2016, the government has proposed additional amendments to the bill, including those related to higher rates of SDLT for additional residential properties. The government is proposing to amend the Finance Bill (which is due to gain Royal Assent in autumn 2016) to exclude annexes from the supplemental 3% charge. The changes insert an additional condition into the requirements for the purchase by an individual with 2 or more dwellings to constitute a higher rate transaction. They provide that at least 2 of the dwellings must not be subsidiary to another of the purchase dwellings. It is proposed that a building is subsidiary if the following are satisfied:-

Post-Brexit, is commercial property still a good investment?

Since the economy came out of the doldrums of the last recession, the value of commercial property has been on the up.  Despite the lack of available mortgage funding, investors have been keen to take advantage of the returns which commercial property has had to offer, particularly since interest rates have made leaving cash in the bank an unattractive option.

Annual Property BBQ

On Thursday 7th July we held our annual ‘Property BBQ’ in the gardens of our offices on Regent Road in Altrincham.  The event was hosted by our property team and was attended by many of our property clients along with some of the North West’s leading property experts including estate agents, surveyors and financial advisors.

The law is an ass…is it true?

This was touted as fact by Charles Dickins as far back as 1838 but it’s a question which many property lawyers have had to start asking themselves when faced with the recent High Court decision in the case of EMI Group Ltd v O & H Q1 Ltd which relates to the validity of the assignment of a lease by a tenant to its guarantor.

Section 106 Obligations – Affordable Housing

We act for a wide spectrum of residential property developers, both small and large scale, but the section 106 obligations in relation to affordable housing can have an impact on whether smaller scale development is financially viable. Government planning policy in relation to affordable housing requirements for small sites is likely to change shortly.

The difficulties of surrendering a lease without a formal Deed of Surrender

The ways in which a lease can be surrendered were brought to attention in the recent case of Padwick Properties Ltd v Punj Lloyd Ltd [2016]EWHC 502(Ch), where the court considered whether it was possible for a surrender by operation of law to take place where one of the parties discharges itself of its obligations under the lease. It was held that this was not enough; both parties must have acted unequivocally.

VAT – zero-rated residential conversions

In light of the increase in opportunities to convert buildings to residential use without express planning permission, HM Revenue and Customs has published a statement which sets out its position on the VAT treatment of the conversion of a non-residential building into a dwelling pursuant to permitted development rights.

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Grosvenor House, 20 Barrington Road, Altrincham, Cheshire, WA14 1HB

Tel: +44 (0)161 941 4000

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