Squash those squatters: how to regain possession of your development site

Author: Rhian Arrenberg, Professional Support Lawyer, Real Estate Dispute Resolution, London

A key concern for anyone involved in the development of land will be the landowner's ability to secure vacant possession of the development site in order for work to start.   Once occupational tenancies are terminated, development sites and units within them can often be left empty.  These can then become prime targets for squatters.   We have seen a recent increase in protesters and travellers occupying high profile development sites either in order to disrupt progress of the development, or simply as a place to live or work until moved on (in the case of travellers). The recent criminalisation of squatting in residential premises has driven squatters towards commercial sites, and typical development sites offering empty retail, office and industrial premises can be attractive to squatters particularly where there is a lack of security and ease of entry.

Whilst prevention is always better than cure (we will write soon on preventing squatters occupying in the first place), developers are likely to own a number of empty properties at any one time, and even with good security, it is no easy task to keep watch on the properties at all times, especially because well-practiced squatters will adopt a covert approach. By the time illegal occupation is discovered, the occupiers may be greater in number, occupying a larger part of the premises than before.

So, what can be done about squatters?  In this post we discuss methods which can be used.

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Clearing a development site – using Torts Act notices

Author: Matt Leggett, Associate, Real Estate, London

Piecing together a large or complex development site inevitably involves dealing with tenants and occupiers in order to obtain vacant possession. On vacating the site, those tenants and occupiers often leave things behind. Depending on the nature of the site, this can include office equipment, stock, furniture, light or heavy machinery, vehicles and vehicle parts or scrap materials.

Can these items be thrown away? Can they be sold?

Unless the items are obviously abandoned worthless rubbish (i.e. refuse), the answer is usually no. First of all, there may be a question as to who actually owned those items – it may not be the tenant, especially if dealing with items that may be owned by a third party e.g. under a hire purchase agreement. If there is any doubt, then this may need investigating and if a third party tries to claim the items then it is sensible to seek proof of ownership, to protect against any argument by the tenant or occupier that you have given items away incorrectly.  

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The Great Repeal Bill: What will this mean for environmental legislation?

Authors: Julie Vaughan, Senior Associate, Environment and Helena Thompson, Associate, Planning and Environment, London

On 2 October 2016, Prime Minister Theresa May announced at the Conservative Party's annual conference that all existing EU law – and therefore, environmental law – will be kept when the UK leaves the EU.  A "Great Repeal Bill" will be announced in the next Queen's Speech, to repeal the European Communities Act 1972 ("ECA") with effect from our exit of the EU. The ECA gives effect to EU law within the UK, provides for its supremacy over UK law where the two conflict, and provides the enabling powers to make secondary legislation to implement EU Directives. May has stated that when the ECA is repealed, all EU law will no longer have effect in the UK, and the existing EU law will be converted into domestic law ("Converted EU Legislation").

It wasn't clear from May's speech exactly how EU law will be converted. Directly applicable EU law (i.e. EU Regulations) could be deemed, rewritten, or copied into, primary legislation; and UK secondary legalisation implementing EU Directives will be saved by various means.  However, the intent is that all EU environmental law will in some manner continue to have effect in the UK. May stated that Parliament will be able to amend, repeal or improve the Converted EU Legislation, and David Davis added that the Great Repeal Bill would include powers for ministers to make some changes by secondary legislation, causing alarm in some quarters that substantive changes could be made without full Parliamentary scrutiny. However, the power to make environmental legislation is devolved to the regions – Scotland, Wales and Northern Ireland – and it is unclear how the Great Repeal Bill will deal with the devolved powers.

Important questions remain unanswered (discussed below in this post):

1. How will we interpret Converted EU Legislation?

2. How will references to EU legislation, guidance or bodies be dealt with in the Converted EU Legislation?

3. Are we stuck with EU legislation at the point of Brexit?

 

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Important Information for Property Investors: Proposed extension of the ‘no-scheme’ principle for compulsory purchase compensation, to include relevant transport projects from 8 September 2016

Authors: Alexandra Rhodes, Senior Associate, Planning and Matthew White, Partner and Head of Planning, London

In September the Department for Communities and Local Government ('DCLG') and HM Treasury issued the Government's response to its consultation carried out earlier this year on further reform of the compulsory purchase system.

A core principle of compulsory purchase compensation is that land should be acquired at market value in the absence of the scheme underlying the compulsory purchase. Since the principle was first established in the Pointe Gourde decision, over a century of case law has sought to clarify the basis upon which the land valuation in these circumstances is calculated, based around the 'no-scheme' world.

The proposed reforms include:

(a) clarification of the 'no-scheme' land valuation principle for compulsory purchase compensation; and

(b) extension of what constitutes the 'scheme' to include 'relevant transport projects', subject to safeguards to ensure a direct link to the scheme.

The extension of the 'scheme' to transport infrastructure projects only is proposed because these projects are seen to have the most discernible impact on land values.

This blog entry looks at the proposed changes relating to the 'no scheme world' definition, and the potential impact on landowners. Importantly, the new rules (if passed) would apply to land acquired on or after 8 September 2016.

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Compensation for closure of a dangerous structure

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Author: Michael Mendelblat, Professional Support Lawyer, Construction and Engineering, London

In this post, we examine the Supreme Court decision in the case of Hastings Borough Council v Manolete Partners Plc on 27 July 2016.  The court considered whether a local authority was liable to pay compensation where it had taken emergency action under the Building Act 1984 to close a building which was in a dangerous state (Hastings Pier). 

Anyone who sustains damage as a result of the closure can claim compensation for their loss under the 1984 Act in relation to a matter as to which he is not himself in default.  The court decided that, on the facts of the case, a leaseholder was not in default as it was not legally responsible for the state of the building or the events which triggered the council's action. Therefore the local authority was liable to pay compensation.

However, the court also decided that "default" did not simply refer to default under the Building Act under which the council had acted.  The case is discussed in more detail below.

1.The facts

2. The Appeal

3. Conclusion

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More on the new power to override easements and other rights: Section 203 of the Housing and Planning Act 2016

Author: Matthew White, Partner and Head of Planning, London

In the September edition of 'Property in Practice', the Law Society's Property magazine, Matthew White, partner and head of planning at HSF, examines the new power to override easements and other rights under section 203 of the Housing and Planning Act 2016, and explains the circumstances in which it might be used by property lawyers and others in the development world.  This power has replaced the power under s237 of the Town and Country Planning Act 1990, with effect from 13 July 2016. 

Click on the link below to read the article.

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A new “right to a community”? Decision by the Secretary of State not to confirm the CPO for Aylesbury Estate

Authors: Matthew White, Partner and Head of Planning, Real Estate, London and Lucy Morton, Professional Support Lawyer, Planning, Real Estate, London

On 16 September 2016, the Secretary of State for Communities and Local Government, Sajid Javid, decided not to confirm Southwark Council's compulsory purchase order (CPO) for an area of the Aylesbury Estate.  This is an unexpected decision by Sajid Javid and has been described as "bizarre" by Southwark Council.  There are reports in the press that the Council intends to challenge the decision in the High Court, because they say it jeopardises the entire housing-led regeneration of the Aylesbury Estate.

Javid's decision agreed with the Inspector's recommendation following a CPO inquiry in October 2015.  The CPO would have facilitated the redevelopment of the third parcel of land on the Aylesbury Estate, including demolishing the existing residential units and providing mixed tenure residential development and associated landscaping. 

The decision not to confirm the CPO gives more weight to human rights and community issues than we have seen in previous decisions on CPOs.  This effectively raises residents' expectations that they will be able to remain in their community, and the considerations outlined by Javid are now likely to be a significant factor in future CPOs.  The decision also demonstrates some of the tensions involved for the Government when they promise to prioritise housing and regeneration.

1. Background

2. Secretary of State's Decision

3. Comment

 

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High Court upholds local authority approach towards securing best value and avoiding the procurement regulations when disposing of land for redevelopment

Author: Adrian Brown, Of Counsel, Competition, Regulation and Trade, Brussels

A recent High Court ruling has clarified the extent of a local authority's obligations to obtain best consideration and to comply with public procurement regulations when it enters into a development agreement with a developer for the regeneration of land.  The case of R (on the application of Faraday Development Ltd) v West Berkshire Council and St Modwen Developments Limited concerned a development agreement entered into between West Berkshire Council and St Modwen to regenerate an area of industrial land in Newbury that was owned mostly by the Council.  St Modwen was chosen as the development partner pursuant to a competitive tender but not one that was conducted under the Public Contracts Regulations 2015. 

An unsuccessful bidder in the tender process, Faraday Development Ltd, brought a challenge against the Council by way of judicial review.  It alleged that the Council had failed in its obligations, first, to obtain best consideration for the disposal of its land under section 123 of the Local Government Act 1972 (LGA) and, second, to comply with the Public Contracts Regulations 2015 (PCR).   In a judgment laid down on 26 August 2016, the High Court found in favour of the Council and dismissed both aspects of Faraday's claim. 

The case provides some reassurance to local authorities and their development partners, with the court taking a pragmatic, flexible approach towards the authority's obligation to secure best value when disposing of land intended for redevelopment.

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The end of pre-commencement conditions or just wishful thinking?

Author: Charlotte Dyer, Senior Associate, Planning, London

After months of hard work preparing a planning application and engaging in discussions with the local planning authority and other statutory bodies, planning permission has finally been granted.  The team members reach for the Champagne in celebration that work will finally be able to get underway on site, when a party pooper (often the lawyer) solemnly reminds everyone about the weeks or months of further hard work needed to discharge pre-commencement conditions before the first spade can hit the ground.  For some projects, the lengthy delay caused in discharging pre-commencement conditions can result in hugely increased costs, meaning that the project falls at the first hurdle.

Now the government has stepped in to save the day by prohibiting the imposition of pre-commencement conditions on planning permission for development in England without the agreement of the applicant.  Why, you might ask, has no one ever thought of this before? 

This blog entry explains the changes, as currently proposed, and considers whether the government's proposed solution heralds the end of multiple pre-commencement conditions holding up the start of construction or whether the reality is likely to fall someway short of that.  

1. What is the current position on the imposition of planning conditions?   

2. What statutory changes have been proposed?   

3. Why is DCLG consulting on these changes?

4. How would these changes apply in practice?

5. Conclusions?

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Development – a dampener on dilapidations claims?

Author: Julia Tobbell, Senior Associate, Real Estate Dispute Resolution, London

Whilst a developer is in the early stages of planning and finance, it may be happy to leave the current tenants in situ to generate a little extra income before the development starts (provided it can remove the tenants when the time comes!).  If that is the case, the parties will follow the usual end of lease procedure in the months running up to the termination date.  In practical terms, this means ensuring that the tenant is making arrangements to vacate and setting out the landlord's claim for dilapidations.  This blog entry addresses the approach developers can take to these claims for dilapidations.

The usual position, upon lease termination, is that the tenant owes the landlord damages in respect of any breaches of its repairing covenants (which can include reinstatement, redecoration, removal of fixtures and so on).  There are a complex series of rules which govern the quantum of damages payable, but in many cases the damages will equate to the actual cost that the landlord will incur in carrying out the works necessary to bring the premises back up to the required standard.  

However, a developer who is planning on demolishing the premises patently has no intention of carrying out any such works.   It would therefore be unfair to expect a tenant to pay in full for the cost of the works when they will never be carried out and, indeed, the premises may shortly cease to exist.  Parliament has long since recognised this potential injustice and addressed it in section 18(1) Landlord and Tenant Act 1927.  The provision contains two 'limbs':

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