Developer & Property Insights

This Bill is making its way through Parliament and, in its current form, may make some amendments to the Register of Overseas Entities established by the Economic Crime (Transparency and Enforcement) Act 2022.

If a counter party in a transaction (for example, a seller) is an overseas entity then the provisions of this Act will be engaged.

In Great Jackson St Estates Ltd v Manchester City Council [2023], an application to modify or discharge restrictions on development of two redundant warehouses was rejected as the degree of control the restrictive covenants gave to the freeholder secured a practical benefit and substantial advantage which would be affected if the restrictions were modified.

This case could be relevant when considering the interpretation of restrictive covenants in leases in so far as they impact use.

In Radcliffe Investment Properties Ltd v Meeson [2023], leaseholders were not responsible for the cost of a waking watch in a block of flats where the reason for the fire safety defect was the landlord’s failure to comply with the necessary annual review of the fire risk assessment and so costs were not reasonably incurred.

This may be relevant on review of compliance with fire safety requirements for blocks of flats.

In Dunlop v Romanoff [2023], a 2018 conveyance was rejected by the Land Registry because of a discrepancy between the plan (which excluded the relevant land) and the written description of the property (which included it).  The Upper Tribunal held that where the written wording was precise and clear but inconsistent with the plan, the plan did not necessarily prevail.  In this case the court could look at extrinsic evidence which was in favour of the wording in the schedule to the conveyance.  This interpretation was legitimate and necessary to read the plan as if it included the relevant land.

This may be helpful if discrepancies arise between descriptions used in conveyances but also flags the importance of reviewing property descriptions carefully before proceeding with transactions.

The Bill would reform the residential rental market in England by replacing fixed term assured tenancies and assured shorthold tenancies with periodic assured tenancies. The Bill also proposes to abolish section 21 “no fault” evictions but widen the grounds for possession under section 8 and Schedule 2 of the Housing Act 1988.

If you need to obtain vacant possession of property let on residential assured shorthold tenancies this could be relevant, however the Bill is in its early stages so developments should be monitored.

In Vodafone Ltd v Potting Shed Bar and Gardens Ltd [2023], the Court of Appeal reversed the decision of the Upper Tribunal to hold that the parties which are currently entitled to the benefit and burden of a Code Agreement can exercise the rights in Part 5 of the 2017 Electronic Communications Code to renew or terminate the arrangement.

This could be relevant for sites with telecoms apparatus in situ.

In Eastpoint Block A RTM Company Ltd v Otubaga [2023], the Court of Appeal held that a right to manage company could apply for a determination that a flat leaseholder is in breach of covenant (by using their property for business and causing nuisance to others) under section 168(4) of the Commonhold and Leasehold Reform Act 2002.  The facts were not decided, only the right to apply.

This could be relevant in blocks if there is a RTM company which wishes to enforce against an individual leaseholder.

In Lazari Properties 2 Ltd v SoS [2023], the court held that a condition in a planning permission limiting the extent of the property which could be used for class A2 and A3 to safeguard the retail function and character of a shopping centre meant that the claimant could not freely move between use classes, even though the Town and Country Planning (Use Classes) Order 1987 had since been amended to subsume both use classes within the wider class E.  In the context of the permission granted, A2 and A3 could not now mean any use within class E.

The case is relevant to the impact of the 2020 changes to the Town and Country Planning (Use Classes) Order 1987 and interpretation of planning permissions.  In this case, the interpretation of the planning permission at the date of grant was relevant.

The government guidance on conservation covenants had been updated to reflect DEFRA’s launch of the application process to apply to become a responsible body and the DEFRA guidance on the criteria for selection.

As a conservation covenant binds successors in title and secures the land for conservation purposes, if you acquire a site which is bound by a conservation covenant, this could affect the development potential of the site.

In URS Corporation Ltd v BDW Trading Ltd [2023], defective design work was discovered after practical completion on a development by developers BDW.  By that time, BDW had sold all flats and so had no proprietary interest.  BDW issued a claim in tort for professional negligence as the design consultants’, URS, contractual limitation period had expired, as had any collateral warranties and the six-year limitation period under the Defective Premises Act 1972.  BDW sought to amend pleadings following the Building Safety Act 2022 to include a previously time barred claim under section 1 of the DPA 1972 (as the limitation period had extended from 6 years to 15 years) and section 1 of the Civil Liability (Contribution) Act 1978.  The Court of Appeal unanimously dismissed the consultant’s appeal and allowed the developer’s claim to continue alongside the new DPA claim.

The Court of Appeal clarified that the cause of action in tort starts to run from practical completion and as the developer had a proprietary interest at the time, they had a potential claim.  It was irrelevant that the developer had no obligation towards the current residents.

There was nothing to prevent a claim under the DPA being added to the ongoing proceedings.  Even though the residents had not yet brought a claim, under the Contribution Act 1978 the flow of loss from the developer’s liability under the DPA would flow to the duty owed by the consultants.

The case shows that developers can bring claims under the DPA against professionals whose work is substandard.  This is in line with the purpose of the BSA and the aim for the cost of remediation to be passed on to those who are responsible.