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.
Assuming nobody comes to collect the items, the developer has become an 'involuntary bailee' of the items and owes certain duties to the ex-tenant/occupier, including the duty not to sell or destroy the goods. That rusty van with three wheels may actually be worth a great deal in the eyes of its owner, and just because it has been left behind when the occupier vacated the premises does not mean it can automatically be sold for scrap.
There is, though, a mechanism contained in the Torts (Interference with Goods) Act 1977 (the "Torts Act") which can be of help. If the process under the Torts Act is followed, a developer can, by serving a notice, require an ex-tenant/occupier to collect the goods, and inform them that failure to do so will result in the goods being sold.
The notice must:
- Specify the name and address of the person holding the goods
- Give sufficient details of the goods (photos can be helpful here)
- Give the location where the goods can be collected (they can be moved and stored somewhere else, so that site clearance can continue while the Torts Act notice period is running)
- Specify the date after which the goods will be sold (giving the owner a reasonable period, depending on the nature of the goods, to claim them – we often suggest two or three weeks)
- Specify any amounts (such as storage costs) which are payable by the owner in respect of the goods
If the date for collection passes without hearing from the owner, the items can be sold by the best method available (usually by auction). However, a key point to note is that even then, the proceeds of sale (less any costs incurred, such as storage costs) must be passed to, or held for, the owner.
Finally, where there was a lease in place, the tenant (having left behind the items at the end of the lease term) may be liable for damages for breach of any covenant to yield up the premises with vacant possession. This may at least in principle allow the landlord to claim the costs e.g. of removing and storing the items, or for valueless rubbish, simply the cost of disposal. However, this pre-supposes that the former tenant is worth pursuing for the money.
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