Legal News

Lexham Securities Ltd and another v Earlsfort Capital Partners Ltd and others [2023] EWHC 909 ( Ch) What are the practical implications of this case? This decision confirms that a mortgagor may still exercise the equity of redemption even after a receiver has concluded a contract on their behalf. Historically, it has been accepted that the equity of redemption is, for a period, put on hold between the making of a sale contract by the mortgagee and the subsequent completion of that contract (see Property and Bloodstock Ltd v Emerton [1968] Ch. 94). The situation is, in practice, different where the sale contract is made by a receiver. Although the receiver is appointed by the mortgagee, the receiver acts as the owner/mortgagor’s agent, not the mortgagee’s. That almost invariably follows from the provisions of the original loan agreement; agreed at the outset, at a time when the...

Bastholm and others v Peveril Securities ( Dalton Park Retail) Ltd and others [2023] EWHC 438 ( Ch) Background The dispute concerned a demand for overage under a Payment Deed connected to the creation of a large designer outlet and retail centre at Dalton Park, County Durham. The Deed identified the ‘ Seller’ as five named individuals and set out a valuation process by expert determination, to be initiated by an application to the Royal Institution of Chartered Surveyors ( RICS). In 2014, those five applied to RICS seeking the appointment of an expert to assess the value of development said to have occurred in 2002. By that time, one of the five had been adjudged bankrupt and later discharged, and his Trustee in Bankruptcy was not included in the approach to RICS. The first defendant, who owned the relevant land, contended that the...

Hambling and another v Wakerly and another [2023] EWHC 343 ( Ch) What are the practical implications of this case? Despite the atypical and unconventional phrasing of the right of way in this dispute, the ruling remains of real guidance. It demonstrates how limited a role on-the-ground and locational realities may ultimately play in construing an easement where, on a strictly textual reading, the clause is considered adequately precise and definitive, so that practicality yields to the clarity of the written grant, as the text requires. What are the principles involved? The settled approach to interpreting a grant of an express easement requires the language to be evaluated against the matrix of facts and circumstances known, or taken to be known, to the original parties at the date of creation. Those surrounding matters may encompass the physical state and configuration of the land when the grant was made, and the...

How to witness and attest a deed under the Law of Property ( Miscellaneous Provisions) Act 1989 ( Euro Securities & Finance v Barrett) Euro Securities & Finance Ltd v Barrett and others [2023] EWHC 51 ( Ch) What are the practical implications of this case? The safest route to prevent disputes over a deed’s validity is: all principal signatories execute at the same time and in the same location; any witness should be a non-party to the deed and observe the signatures physically, in person; and each witness should attest, separately, every signature they observed, doing so straightaway while remaining in the signatories’ presence. Each of these points ought to be documented in writing. That said, the judge in Euro Securities considered that the LP( MP) A 1989 may afford parties greater latitude. Although much of the discussion was obiter, in essence the judge...

Fearn v The Trustees of the Tate Gallery [2023] UKSC 4 What are the practical implications of this case? The Supreme Court has confirmed that visual intrusion can constitute a nuisance, though simple overlooking on its own does not. While eye-catching, the ruling is unlikely to trigger a deluge of neighbour disputes about being watched. The court contemplated that only a marked and sustained degree of visual interference would cross the threshold. As Leggatt LJ explained at [103], instances where land is put to an unusual use that causes visual intrusion of sufficient duration and intensity to found a nuisance claim are expected to be uncommon. It also remains the law that merely putting up a building or structure that looks over another parcel of land, without more, does not amount to a nuisance. Regarding grievances from occupants of highly glazed, tall...

Leon v Kensington Mortgage Company Ltd [2023] EWHC 121 ( Ch) What are the practical implications of this case? This decision offers reassurance to those who guarantee corporate borrowings. The court held that when an individual acts as surety for a company and elects to discharge the debt, the subsequent dissolution of that company does not bar the surety from stepping into the benefit of any security that was taken for the debt. Had the court ruled the opposite—that dissolution deprives the surety of access to the security—it would have placed sureties in an invidious position: anyone guaranteeing a company’s obligations would run a material risk that, if the company were later dissolved, the surety could be compelled to satisfy the liability yet be unable to recoup their outlay even where the company’s indebtedness had been secured against property. Such a result could have had...

Withers v HMRC [2022] UKFTT 433 ( TC) The landholding comprised a dwelling with a self-contained annexe and gardens and grounds of circa 10 acres, together with a further circa 20 acres. Part of the additional land was used for grazing, and part was entered into a rewilding scheme. The grazing area had been used in that way continuously for 20 years, although a formal written grazing agreement—which did curtail the taxpayer’s use of the land in certain respects—was only adopted in 2019. Pursuant to that agreement, a local farmer grazed his sheep on the land in return for a nominal rent and the farmer’s ongoing upkeep of the land. The rewilding land was subject to stringent conditions limiting the taxpayer’s access and use, and imposed duties on the taxpayer to control pests and to refrain from grazing livestock on the specified land. In both...

Dee and another v Secretary of State for Levelling Up, Housing and Communities and another [2022] EWHC 2166 ( Admin) What are the practical implications of this case? This ruling underlines that proving an error of law was immaterial, and that the same outcome would have followed absent the mistake, is a significant hurdle. Although the Simplex defence is driven by the facts and turns on the language of the decision when read in the round, the requirement to establish that the result ‘would have’ been the same renders it an onerous task for any defendant. The judgment also illustrates that the challenge intensifies where the legal error is a failure by the decision-maker to have regard to a matter in exercising planning judgement, because the court will be reluctant to speculate on how consideration of a particular factor might have influenced that planning...

Re Wotherspoon (in bankruptcy); Hinton (as trustee in bankruptcy of John Wotherspoon) v Gillian Wotherspoon [2022] EWHC 2083 ( Ch), [2022] All ER ( D) 67 ( Aug) What are the practical implications of this case? It is axiomatic that, in nearly every claim, the claimant or applicant bears the burden of proof. That principle equally applies to office-holders pursuing antecedent transaction claims. Pre-bankruptcy dealings between a would-be bankrupt and a spouse or close associate may tempt an office-holder to infer an improper motive and press a claim. This decision squarely reminds insolvency practitioners and lawyers that, even if the recipient’s or bankrupt’s account seems doubtful, there must still be contemporaneous material from which the case can be proved. That is especially significant under IA 1986, s 423, where an improper purpose must be demonstrated and not merely presumed in light of the...

Oceanfill Ltd v Nuffield Health and Cannons Group Ltd [2022] EWHC 2178 ( Ch) What are the practical implications of this case? This decision may offer reassurance to commercial landlords anxious about tenants attempting to cram down landlord claims under the new CA 2006, Pt 26A, especially after the High Court sanctioned the Virgin Active plan. Under Pt 26A—specifically CA 2006, s 901G—the court can approve a plan even where not all creditor classes support it, via a cross-class cram-down, provided at least one class has agreed and that no member would fare worse under the relevant alternative (ie the most likely outcome if the plan were not approved). For landlords holding AGAs—and it is worth reviewing historic title documents, as the AGA here dated back around twenty years—it is reassuring that such guarantees are not automatically stripped of value in exactly the...

Mayor and Burgesses of the Tower Hamlets London Borough Council v Khan [2022] EWCA Civ 831 What are the practical implications of this case? Lease agreements often include provisions enabling landlords to reclaim legal costs incurred ‘in contemplation of’ or ‘incidental to’ forfeiture proceedings. Attempts to recover rent and service charge arrears are frequently brought in forums where costs are generally not recoverable, such as the FTT and the County Court Small Claims Track. Landlords therefore lean on these provisions to assert that costs are contractually recoverable because proceedings to recover rent/service charge arrears were issued ‘in contemplation of’ or ‘incidental to’ prospective forfeiture proceedings. The Court of Appeal’s decision curtails the range of what will be treated as ‘incidental to the preparation and service’ of a section 146 notice, yet gives no guidance on what costs are incurred ‘in...

What are the practical implications of this case? This was a renewed bid for permission to pursue a judicial review of Manchester City Council’s decision to grant planning permission for replacing a car park with a 55‑storey tower including student accommodation. As with all rulings at the permission stage, the judgment does not create a precedent: the court was simply deciding whether any ground met the arguability threshold for the claim to proceed to a substantive hearing. Even so, it raises notable points on deliverability and consultation. Deliverability: the court held that the presence of private rights that may need to be bought out—such as rights of light, a right of way over the development land or, as here, a right to park in the car park—does not render a scheme undeliverable. These are questions of commercial practicality and do not undermine...

The Tower One St George Wharf Ltd v HMRC [2022] UKFTT 154 ( TC) A corporate group was progressing a site for residential use as a development project. The concluding phase involved a 50‑storey tower, which they planned to place into a special purpose vehicle ( SPV) to ring‑fence exposure to risk and potential liabilities, and to secure greater financial flexibility for the project as a whole. After consulting their tax advisers, the group executed a sequence of transactions on the very same day intended to step up the tax cost of the scheme, so the SPV would be treated as acquiring it at market value, with no tax liabilities arising along the chain overall. In outline, the company that owned the property granted a 999‑year lease to another group entity, B64. The shares in B64 were then purchased by......

Hyman and another v HMRC [2022] EWCA Civ 185 Under section 116 of the Finance Act 2003 ( FA 2003), any land which is, or comprises part of, the gardens and grounds of a dwelling is regarded as being residential property and is charged to SDLT at the residential rates. The taxpayers were seeking to argue that land acquired with a dwelling did not constitute part of that property’s garden or grounds, so that buying the dwelling together with the land should be classed as mixed-use property (and benefit from the lower non-residential SDLT rates). They further maintained that land can qualify as garden or grounds of a dwelling only where the land is required for the reasonable enjoyment of the......

On 15 December 2021, the government presented to Parliament regulations to implement the proposals set out in the Consultation response: EV Charge points in Residential and Non-residential Buildings (for more information on the proposals, see: Consultation outcome on electric vehicle charge points in buildings published, LNB News 22/11/2021 81). The Regulations, SI 2021/1392, set out the specifics developers and other stakeholders require to comply with the new obligations. In this legal update, we address key questions about the new regulations and their application. When do the Regulations come into force? The Regulations will come into effect on 15 June 2022. What about developments in progress as at 15 June 2022—will they be subject to the new requirements? The Regulations contain transitional provisions. They will not apply in relation to building work where a building notice or an initial notice has been provided to, or full plans have been...

R (on the application of Sav Development Ltd) v London Borough of Tower Hamlets [2021] EWHC 3211 ( Admin) What are the practical implications of this case? This judgment illustrates and confirms that: where justified, local policy may diverge from national policy for local authorities, when such a course is contemplated during plan-making, thorough evidence gathering is essential a conflict between policies can only exist where there are two policies there is no inconsistency between a document containing a specific policy on a topic and another that is silent on that topic this approach applies to both section 38(5) of the Planning and Compulsory Purchase Act 2004 ( PCPA 2004) and the Town and Country Planning ( Local Planning) ( England) Regulations 2012, SI 2012/767, reg 8(3) planning policy should be read on its face, unless there is a...

Mars Capital Finance Ltd v Hussain and others [2021] EWHC 2416 ( Ch) What are the practical implications of this case? This ruling underlines that, after a transfer of land has been entered on the register, any prior defects in the enforceability of the underlying contract for that transfer cease to matter. Accordingly, earlier formal shortcomings cannot be used to unsettle a completed, registered disposition. That principle is clear and decisive here. In addition—though not essential to the outcome—the judge endorsed the position that sections 43 and 44 of the Companies Act 2006 permit three mechanisms for a company to enter a written contract (by the company or on its behalf). This contrasts with the interpretation that, for the purposes of the Law of Property ( Miscellaneous Provisions) Act 1989, only two methods exist, and it departs from Lewison J’s approach in Redcard Ltd v...

Jalili v Bury Council 20210617 What are the practical implications of this case? Recent years have seen a sharp rise in tenants pursuing housing disrepair claims against social landlords. How these cases are allocated to a track is somewhat atypical. Under CPR 26.6(b), such proceedings go to the small claims track where there is an application for an order obliging the landlord to carry out remedial works and ‘the cost of the repairs or other work to the premises is estimated to be not more than £1,000’ together with ‘the value of any other claim for damages is not more than £1,000’. Consequently, if specific performance is sought, the case moves to the fast track if either the estimated repair cost or the damages claim exceeds £1,000. Failing that, the fast track only applies where the damages claim exceeds £10,000. The majority of...

Ladson Preston Ltd and AKA Developments Greenfield Ltd v HMRC [2021] UKFTT 251 ( TC) Both Ladson Preston Ltd ( Ladson) and AKA Developments Greenfield Ltd ( AKA) purchased property benefiting from planning permission for multiple residential units. As at the effective date of each transaction, no dwelling had yet been erected. The taxpayers contended that the presence of that consent was enough to satisfy the statutory wording of paragraph 7(2)(b) of Schedule 6B to the Finance Act 2003 ( FA 2003). Under that provision, a building qualifies as a dwelling for the purposes of multiple dwellings relief ( MDR) if it is in the course of construction or is being adapted for such occupation. AKA had additionally carried out early-stage site works and argued that those operations—specifically the drilling of boreholes—meant the dwellings were already in the process of being built. The cases...

Rock Ferry Waterfront Trust v Pennistone Holdings Ltd [2021] EWCA Civ 1029 What are the practical implications of this case? The circumstances of this case may seem, to some at least, somewhat unusual. Yet they are the kind of facts that are liable to arise in practice more often than might first appear. From the judgment two key principles can be drawn: firstly, where a company not incorporated under the laws of England and Wales is dissolved at a time when it owns property situated in England and Wales, section 1012 of the Companies Act 2006 (the bona vacantia provisions) does not apply. Nonetheless, the company’s incorporation in another jurisdiction does not prevent English law from governing what then happens to the land. Under English law, the land escheats to the Crown and the freehold previously vested in the dissolved company is...