Legal News

Original news Eason and another v Wong [2017] EWHC 209 ( Ch), [2017] All ER ( D) 196 ( Mar) The Chancery Division determined that investors who had contracted to acquire long leases of student flats and paid deposits held an enforceable equitable lien over the land comprising the subject of each individual bargain once the seller failed to progress the development. The court further ruled that enforcement of an equitable lien does not depend on the pre‑existence of the legal estate in the property; it is sufficient that the vendor agreed to create a legal estate out of an existing legal estate and that the estate to be created is identifiable. What was the background to the case? A company incorporated as a special purpose vehicle to purchase and develop a site for student accommodation entered into off‑plan contracts with a number of...

Original news Camelot Property Management Ltd and another company v Roynon [2017] Lexis Citation 28 What issues did this case raise? Why is it significant? The claim was issued by Camelot Property Management Limited and Camelot Guardian Management Limited (together, Camelot). Camelot is an organisation established to assist with the security of vacant property and to safeguard empty premises. They were engaged by Bristol City Council to protect a former, and at that time vacant, elderly care home in Bristol from vandalism and unlawful occupation. Camelot permitted Mr Greg Roynon to occupy part of the premises. Camelot maintained that his presence was solely as a property guardian and was strictly in line with an agreement between them which they contended was, and which on its face appeared to be, a licence. Camelot served notice terminating that licence, yet Mr Roynon declined to vacate the...

Original news Crown Estate Commissioners v Wakley and another [2016] Lexis Citation 697, [2016] All ER ( D) 132 ( Dec). The Chancery Division fixed damages on the defendants’ counterclaim at £1,586,366.60 for misrepresentations and breaches of contract. It was further determined that the defendants could apply that sum by way of set-off against what they owed the claimant in unpaid rent, reducing their liability for arrears accordingly. Why is this decision of importance? The significant level of damages awarded to the tenant (£1.75m) is a clear warning to property professionals: information supplied by sellers and landlords to buyers and tenants must be carefully researched, so they do not expose themselves to claims for negligent misrepresentation. The ruling also underscores that the quantum of damages can be substantial even in the absence of any deliberate intention to defraud or deceive, highlighting the risk where...

Original news Fast Drinks Ltd v Cetyl International Group Inc [2016] EWHC 3501 ( QB). The newly released transcript of this notable ex tempore ruling has now appeared. On appeal, the question was whether the sub‑tenant, Fast Drinks, could properly make a section 26 request for a new tenancy naming 1 July 2015 as the start date, even though the contractual term would otherwise have ended on 15 January 2016. The dispute centred on timing under section 26, given a later contractual expiry in mid‑ January 2016 instead. What are the practical implications of this case? The decision cautions landlords holding break options that a break operated lawfully brings only the contractual term of the headlease and any sub‑leases to an end. But any statutory continuation tenancy or tenancies persist unless and until a Landlord and Tenant Act 1954 section 25 notice is served, citing one of the...

Original news Newman v Clarke [2016] EWHC 2959 ( Ch) In December 1996 Mr Clarke established an accumulation and maintenance settlement. Mrs Newman and Mrs Clarke were two of the three initial trustees. In April 1997, Mrs Newman and her husband granted a lease of a residential property to Mr Clarke. That lease qualified for enfranchisement under the Leasehold Reform Act 1967 ( LRA 1967). On 19 June 1997, Mr and Mrs Newman sold their freehold reversion in the property to the original trustees of the settlement. On 25 June 1997, Mr Clarke took the place of the third of the original trustees as a trustee of the settlement. On 12 September 1997, the original trustees conveyed the freehold reversion in the property to Mrs Newman, Mrs Marks and Mr Clarke to hold upon the terms of the settlement. On 7 January 1998, they were...

Original news Baker and another v Craggs [2016] EWHC 3250 ( Ch) The proprietors of a parcel of land (servient land) first conveyed it to Mr Craggs, and later purported to bestow a right of way over it in the Bakers’ favour within a transfer to them of different land (dominant land). Registration of the servient land was materially delayed because the plan was defective, ultimately with the consequence that the right of way was entered on the register before the transfer to Mr Craggs was registered. The central question was whether the grant of the right of way was effective. In short, the timing of registration determined priority between the competing interests. What are the practical implications of this case? The court considered that the grant appeared to result from conveyancing slips. Nevertheless, had the transfer of the servient land been registered within the...

Practical implications This ruling is notable for its observations on the need for dishonesty under LA 1980, s 21(1). It is settled that dishonesty is required for LA 1980, s 21(1)(a)—no limitation where a trustee commits a fraudulent breach of trust. Yet, although the court appeared to imply that dishonesty is also demanded for LA 1980, s 21(1)(b)—no limitation on recovering trust property from a trustee who holds it or has converted it to his own use— Smith J nevertheless concluded that LA 1980, s 21(1)(b) was satisfied, notwithstanding the absence of dishonesty on the evidence. The decision likewise indicates that, where there is a single active director who has committed undisclosed breaches of fiduciary duty, they owe a continuing obligation to disclose those breaches while they remain a director; and whilst the non-disclosure persists, those breaches are likely to be regarded as...

Original news Avon Ground Rents v 51 Earls Court Square RTM Company [2016] UKUT 0022 ( LC) What was the issue involved? The dispute centred solely on whether 51 Earls Court Square RTM Company Limited (the company) qualified as an RTM company within the meaning of the Commonhold and Leasehold Reform Act 2002 ( CLRA 2002) for these purposes. If so, all parties accepted that it could obtain the right to manage the building at 51 Earls Court Square (the building), the property that gives the company its name. If not, the notice seeking the right to manage, served by the company on 8 January 2015, would be ineffective and of no legal consequence. The question hinged exclusively on construing the company’s articles of association, namely what the incorporators precisely intended and understood by defining 'the premises' as ' Flat 1–13, 51 Earls Court...

Sainsbury’s Supermarkets Ltd v Bristol Rovers (1883) Ltd [2015] EWHC 2002 ( Ch), [2015] All ER ( D) 145 ( Jul) The Chancery Division determined that Sainsbury’s was entitled to terminate a conditional contract to purchase the defendant’s stadium, as a condition precedent—requiring Sainsbury’s to obtain an acceptable planning permission for a store to redevelop the ground as a supermarket—had not been satisfied. What was the background to the case? In March 2011, Sainsbury’s entered into a conditional agreement to acquire the Memorial Stadium, Bristol, from Bristol Rovers Football Club for £30m. At the same time, the club concluded an agreement with the University of the West of England ( UWE) to develop a new stadium. The intention was for Sainsbury’s to build a new supermarket on the Memorial Stadium site. The club would apply the purchase price to finance the new stadium project with UWE, to which it...

Original news Trustees of the Alice Ellen Cooper- Dean Charitable Foundation v Greensleeves Owners Limited [2015] UKUT 0320 ( LC). The UT affirmed the Leasehold Valuation Tribunal ( LVT) decision that a ‘two-stage’ enfranchisement resulted in no payment being due to the freeholder. What were the facts? The position can be broken down into three stages. Stage one The property was split into eight residential flats. Each flat lease provided for an initial ground rent of £300, with a review scheduled for late 2015. At the same time, a headlease was granted to a third party management company unconnected with the landlord. Under that headlease, the freeholder’s initial ground rent was £2,400, also subject to review in late 2015. Stage two In 2011, six of the flat tenants sought and obtained lease extensions under the Leasehold Reform, Housing and Urban Development Act 1993 ( LRHUDA 1993). As a...

Original news Wood v Waddington [2015] EWCA Civ 538 The core question was whether Mr and Mrs Wood possessed rights of way over land owned by Mr Waddington. The Woods relied on four alternative grounds: that the rights were conferred by an express grant that they passed by virtue of s 62 of the Law of Property Act 1925 that they arose under the rule in Wheeldon v Burrows (1879) 12 Ch D 31, [1874–80] All ER Rep 669 that they were implied from the parties’ common intention that the conveyed land would be used in a definite and particular manner The High Court had earlier found the Woods were not entitled to any of the rights claimed. They appealed to the Court of Appeal. What were the facts of the case? As successors in title to the previous proprietors, the Woods asserted two rights: to go across a parcel of land to reach a...

Original news Hastings Borough Council v Braear Developments [2015] UKUT 0145 ( LC) The property was a five-storey Victorian mid-terrace house, converted into five self-contained flats held on long leases. The right to manage was taken over by an RTM company, which then applied to the local housing authority for a grant to fund repairs to the common parts of the building. Approval was granted on the basis that the works would be completed within 12 months; however, the RTM company did not finish within the permitted 12-month period, so the grant was cancelled. The grant application brought the poor condition of the external staircase to the authority’s attention, and the authority served an emergency prohibition order, preventing any use of the staircase. In answer to that notice, the owner of the only two occupied flats on the upper floors carried out limited...

Why are the protocols being amended? In his Final Report on Civil Litigation Costs ( January 2010), Lord Justice Jackson proposed retaining the pre-action protocols, while introducing targeted changes to improve how they work and to keep pre-action costs proportionate. He also advised creating a specific protocol for debt claims where a business pursues an individual. In response, a CPRC sub-committee was established to review and recommend any necessary amendments to the pre-action protocols. Although the sub-committee is still considering drafts of some protocols, several have been issued and, subject to ministerial sign-off, are expected to commence on 6 April 2015. Below is a summary of the protocols being revised and the stage each has reached, with links to the latest drafts where available. We will provide further updates as the CPRC publishes more material and will revise our Practice Notes once the...

Original news Windemere Marina Village v Wild [2014] UKUT 0163 ( LC) The landlord of a marina development – a mixed scheme on the banks of Windermere – appealed an LVT determination that replaced the apportionment of service costs payable by tenants of 26 dwellings with the tribunal’s own division, displacing the split previously set by the landlord’s appointed surveyor. Permission to appeal was granted because the question raised a point of principle with potentially wide reach. Under the lease of a dwelling at the marina, the tenant is required to contribute a fair share of service expenses, that share to be fixed by the Lessor’s surveyor for the time being, whose decision is stated to be final and binding. The central issue was whether statute renders void an agreement making the landlord’s surveyor’s assessment of the service charge...

Original news Coventry and others v Lawrence and another [2014] UKSC 13, [2014] All ER ( D) 245 ( Feb) In February 1975, planning permission was issued to build a stadium in rural Suffolk. That consent authorised use for speedway racing and related facilities for a period of ten years, and in 1985 it was thereafter made permanent. Stock car and banger racing began at the stadium in 1984; after a decade of such activity, Mr Waters obtained a certificate of lawfulness of existing use or development. To the rear of the stadium lay a motocross circuit, operated under a temporary personal planning consent, which was later renewed on a permanent footing. In January 2006 the proprietors, Katherine Lawrence and Raymond Shields, took up residence at Fenland, a residential property situated close to the stadium and the track. In 2008 they commenced...