Legal News

Clark Hill Ltd v HMRC [2018] UKFTT 111 ( TC) What are the practical implications of this case? The ruling features noteworthy judicial comments, expressed obiter, addressing the complex question of how VAT applies where a contract is novated. The dispute centred on the VAT time of supply (the tax point) for a property disposal in which the initial purchaser had paid a deposit, yet the agreement was later novated, with completion occurring between the original vendor and a different purchaser. In a scenario without novation, the operation of the time of supply provisions in section 6 of the Value Added Tax Act 1994 ( VATA 1994) is that a deposit paid to the seller or the seller’s agent establishes a tax point. That approach is troublesome when novation intervenes, because the deposit is made under one contract while completion proceeds under another. The...

R (on the application of Mott) v Environment Agency [2018] UKSC 10, [2018] All ER ( D) 77 ( Feb) What are the practical implications of the decision? This case illustrates how the courts address the concept of a ‘fair balance’ in a human rights setting. Striking that balance requires weighing the general interests of the community against the protection of an individual’s fundamental rights; the balance is not achieved where the person affected is made to carry an individual and excessive burden. What was the background to the appeal? The respondent held a leasehold interest in a salmon fishery in the Severn Estuary, which he had run as his full-time occupation for almost four decades. After the Salmon Freshwater Fisheries Act 1975 was amended with effect from 2011, the appellant was able to issue fishing licences with conditions that capped the number of fish taken. To...

Southern Gas Networks plc v Thames Water Utilities Ltd [2018] EWCA Civ 33, [2018] All ER ( D) 132 ( Jan) What are the practical implications of this case? The key takeaway for advisers to suppliers is that common law causes of action may endure alongside the detailed statutory scheme governing undertakers. That remains so even when a dedicated statutory liability clause exists that could yield a remedy on identical facts. Whether the common law persists is ultimately a matter of construing the specific provisions in play. Clauses that negate exoneration can assist, but they are not essential. The court’s reasoning draws on a well-established line of dicta: mere differences between the statute and the common law do not suffice; to displace the common law, the court must identify an ‘inconsistency’ or ‘incompatibility’ between them. For instance, if the common law would confer a more...

Original news Farrar v Leongreen Ltd [2017] EWCA Civ 2211, [2018] All ER ( D) 13 ( Jan) As the landlord’s second suit advanced a distinct cause of action from the earlier possession claim, the award of mesne profits was not rendered unlawful by estoppel or any comparable doctrine. The Court of Appeal ( Civil Division) therefore dismissed the tenant’s appeal, leaving intact the mesne profits ordered for trespass. What is the significance of this case? Handed down just before Christmas 2017, the ruling in Farrar v Leongreen Ltd confirmed that a property owner may issue separate proceedings: one for possession and another for mesne profits. What is the background to the case? On 21 November 2012, Leongreen Ltd obtained a long leasehold in a flat at Artillery Mansions, Victoria Street, London from a connected company. At that point, Mr Farrar, a former business associate of the...

What are the practical implications of this case? Zurich Insurance Plc v Nightscene Ltd [2017] Lexis Citation 445. This ruling is significant, first and foremost, for its analysis of the application of the rule in Shah [2001] EWCA Civ 527 to Deeds executed by companies. Those acquainted with Shah will remember that it addressed the effectiveness of a Deed executed by private individuals. They contended the Deed was ineffective because their signatures had not been attested at the time of signing, so the requirements of s1 of the Law of Property ( Miscellaneous Provisions) Act 1989 ( LP( MP) A 1989) were not fulfilled. The court rejected that case, holding the individuals were estopped from denying the Deed’s validity, essentially because it appeared, on its face, to have been duly executed when it reached the receiving party. This decision logically confirms that the Shah...

Original news R (on the application of Bishop) v Westminster Council [2017] EWHC 3102 ( Admin) What is the significance of the decision for authorities and developers? This ruling stands as a clear caution to developers and local planning authorities ( LPAs) to strictly observe the procedural rules governing planning applications. The court condemned the developer for recklessly submitting the wrong ownership certificate and other errors on the application form, which together were misleading and deprived an interested party of the chance to make representations on the proposal. Beyond placing any planning permission obtained through misleading statements at risk of being set aside, it is a criminal offence to issue an ownership certificate that you know is false or misleading, or to do so recklessly. Sound practice is to carry out a Land Registry search of the site before lodging an...

What is the significance of this case? Why is it important for practitioners? On 10 August 2017, at a hearing at Highbury Corner Magistrates’ Court, Green Live admitted two offences contrary to the Consumer Protection from Unfair Trading Regulations 2008, SI 2008/1277 (the Regulations). The prosecution concerned the issuing of supposed ‘licences to occupy’ when the arrangements were in fact tenancies. Thought to be the first matter of its kind in the UK, its significance lies in showing that local authorities can, and will, act where agents or landlords attempt to evade obligations to afford tenants security of tenure and to protect deposits. While tenants have long resisted possession claims and pursued statutory penalties for failures to safeguard deposits, this case makes clear that landlords and agents engaging in such conduct risk criminal prosecution as well as civil...

Original news Watt v Dignan and others [2017] EWCA Civ 1390 The central question was whether the Dignans held enforceable easements to use the toilet facilities within unit 27 on an industrial estate. Unit 27 belonged to Mr Watt. It was accepted that these rights had been granted to the Dignans’ predecessors in title, as owners of units 26A and 29, by two conveyances dated 27 September 1985 and 16 April 1987. The further issue was whether they were now prevented by estoppel from asserting those rights. The Recorder at first instance found that they were not, and Mr Watt appealed to the Court of Appeal. What are the practical implications of this case? Although the decision is fact specific, it offers helpful reminders for Property Disputes practitioners about the lines of argument advanced, the fall-out where a case different from that pleaded is pursued, and the...

What crisis is the UK currently facing in terms of housing? Anyone paying even minimal attention recognises the shortage of truly affordable homes. Aspiring first-time buyers struggle ever more to step onto the property ladder, rents continue to rocket, and homelessness is climbing. Earlier in 2017, trade union campaigners and community figures issued an open letter demanding more social housing and condemning the ‘severe harm’ caused by ‘precarious, unaffordable, substandard’ homes. They sensibly stressed that building genuinely affordable dwellings is essential, and that this hinges on sustained government funding and resolve. In May 2017, Inside Housing reported that fewer than half of Right to Buy replacements qualify as social housing. Inside Housing further noted that Sheffield Hallam University, for the Consortium of Associations in the South East, warned that government proposals to cap housing benefit at Local Housing Allowance levels would exclude 84% of young...

Original news Dean v Secretary of State for Business, Energy and Industrial Strategy [2017] EWHC 1998 ( Admin); [2017] All ER ( D) 72 ( Aug). The Planning Court concluded that the grant of a PEDL under section 3 of the Petroleum Act 1998 ( PA 1998) was not entirely constrained by the statutory licensing code, so the Secretary of State could agree to alter the licence terms. Consequently, it rejected the claimant’s case that the deed varying the licence was ultra vires, and dismissed his application for judicial review. What was the background to the case? In 2008 the defendant issued a PEDL conferring exclusive rights on the licensees to search, drill for and recover hydrocarbons within a defined geographic area. The licence period was split into three stages: a stage for the licensee to undertake the agreed works programme of seismic and...

Original news Saw ( SW) 2010 Ltd and another v Wilson and others (as joint administrators of Property Edge Lettings Ltd) and another [2017] EWCA Civ 1001 What was the background to the appeal? In December 2007, SAW ( SW) 2010 Limited ( AW), one of the appellants and both a shareholder in and creditor of Property Edge Lettings Limited (the company), granted the company a long lease of a residential apartment block in Exeter known as Bartholomew House. On 18 December 2007, Capital Homes Loans Limited ( CHL) advanced a £1.25m buy-to-let loan to the company, secured by six fixed charges, in materially the same form, over each flat within Bartholomew House (the CHL charge). The CHL charge also imposed a fixed charge over rental income from the flats and a floating charge over the remainder of the company’s...

Original news In NRAM v Evans [2015] EWHC 1543 ( Ch), the court directed the rectification of an inadvertent discharge of a mortgage. The proceedings centred on whether a 2005 loan, advanced by NRAM’s predecessor to Mr and Mrs Evans, was secured over their property. The key issue was whether a 2004 charge, which had secured an earlier loan to the borrowers, who were subsequently made bankrupt, was effective to cover the 2005 advance. The High Court held that, on its terms, the 2004 charge did secure the 2005 loan against the property. The mortgage conditions attaching to the 2004 charge were sufficiently broad and unambiguous to include the 2005 borrowing. Upon the borrowers’ bankruptcy, their estate vested in the Official Receiver as trustee, but remained subject to the bank’s charge. It was also found that the bank had made a distinct mistake by...

Original news Minerva ( Wandsworth) Ltd v Greenland Ram ( London) Ltd [2017] EWHC 1457 ( Ch), [2017] All ER ( D) 154 ( Jun) The Chancery Division found that the defendant company unlawfully blocked the claimant’s continuation of a construction scheme by declining to enter the requisite agreement with the local authority that would have permitted it to advance. The claimant was entitled to make its planning application at the time it did, and the defendant’s conduct amounted to a contractual breach by stopping the works from proceeding. What is the background to the case? Minerva ( Wandsworth) Ltd obtained planning consent to redevelop the Ram Brewery site in Wandsworth, South West London, featuring a 34‑storey residential tower, and entered into a section 106 Town and Country Planning Act 1990 agreement obliging the delivery of affordable housing within the scheme. Minerva then sold the site to...

Original news Parkes v Wilkes [2017] EWHC 1556 ( Ch) The claimant and the defendant were each leaseholders of separate flats in the same building. By collective enfranchisement under the Leasehold Reform, Housing and Urban Development Act 1993, they acquired the freehold from Regis Group Ltd. At the same time, they executed a trust deed over the freehold, naming themselves as the two trustees and the sole beneficiaries. The deed was straightforward, stating that they held the property on trust for one another as tenants in common in equal shares. Seven years later, the claimant asked the defendant to agree a 999-year extension of her lease at a peppercorn rent. No agreement followed. The claimant then sought, but failed to obtain, an order under the Trusts of Land and Appointment of Trustees Act 1996 to grant a 999-year lease of her flat for no...

Original news Taylor v Taylor [2017] EWHC 1080 ( Ch) In June 2012, a father, Mark, and his son, Boyd, acquired a transfer of a modest hotel with a campsite, together by way of conveyance. It was undisputed between both sides that this made them joint tenants at law at the time. The conveyance concerned part only of a wider tract of land within a larger holding. In May 2013, Mark served a notice to sever the joint tenancy which, on its very face, converted the beneficial joint tenancy (assuming that was its nature) into a tenancy in common in equal proportions. Nonetheless, Mark asserted a four-fifths share of the beneficial interest, citing his larger contribution to the purchase price. By contrast, Boyd maintained he was due one-half of the beneficial interest, on the basis of a promise to that effect and his...

Original news JCAM Commercial Real Estate Property XV Ltd v Davis Haulage Ltd [2017] EWCA Civ 267, [2017] All ER ( D) 62 ( Apr) The Court of Appeal ( Civil Division) upheld the property owner’s challenge to a High Court ruling that had declined to take off the court record a copy of a notice of intention ( No I) to appoint an administrator. The court examined the effect of paragraphs 44(4) and 28(2) of Schedule B1 to the Insolvency Act 1986. What, then, should practitioners draw from this? The ruling makes clear that lodging an No I where there is nobody to serve, or where there is no firm decision to proceed to an appointment, purely to obtain the moratorium, can no longer be relied upon. Merely contemplating an administration if other avenues fall away does not suffice....

Original news London Borough of Southwark v Akhtar [2017] UKUT 150 ( LC) This ruling addresses whether notices connected to service charges were valid and properly served. One notice was given under a lease clause obliging the landlord to supply the tenant with a reasonable advance estimate of the service charge before each service charge year began (the lease notice). The tenant was required to settle that estimate by four equal instalments on 1 April, 1 July, 1 October and 1 January. Notices issued under section 20B of the Landlord and Tenant Act 1985 (section 20B notices), covering the same works as the lease notice, were likewise contested on the footing that they had not been served on the tenant and so were ineffective. What are the practical lessons from this decision? The safest course is plainly to adhere to the lease process. Failure to do so...

Original news Port of London Authority v Paul Mendoza [2017] UKUT 0146 ( TCC). The owner of a houseboat failed to prove title by adverse possession over part of the River Thames’ bed and foreshore. What are the practical implications of this case? The ruling underscores how challenging it is to obtain adverse possession of a river bed simply by leaving a boat moored there. That conduct is inherently ambiguous and does not, by itself, signal to the world an intention to exclude others from the land. The Upper Tribunal confirmed there is no authority that mere mooring, without more, constitutes both factual possession and adequate evidence of intention to possess. By contrast, there is clear authority that the self‑serving assertions of an alleged adverse possessor about intention must be treated with caution and supported by other evidence. Where intention is to be inferred from...

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...