ABG Property Newsletter – May 2012

National planning policy framework

The Department for Communities and Local Government has published a new national planning policy framework (“NPPF”) which came into force on 27th March 2012. The new framework consolidates over 1000 pages of previous planning guidance into a single 59 page document. The framework sets out the Government’s planning policies and how they are expected to be applied. Disappointingly, that technical guidance is described as an ‘interim measure pending a wider review of guidance to support planning policy’ – so more policy changes are anticipated.

At the heart of the policy is a presumption in favour of sustainable development. This presumption enshrines the broad principles for sustainable development put forward by international and national bodies. Sustainable development is defined as meeting the needs of the present without compromising the ability of future generations to meet their own needs. This could raise potential difficulties in applying the presumption where there is an overriding statutory requirement to protect the character of an area; for example conservation areas or in the Green Belt.

Alongside the NPPF, the Department has published technical guidance to planning authorities to ensure the effective implementation of the policy on development in areas at risk of flooding and in relation to mineral extraction. There is also a new planning policy document setting out new planning policies for traveller sites.

Ultimately, a change in planning policy by itself cannot solve the UK’s chronic housing shortage. So while the NPPF advocates a simpler planning system, achieving the Government’s aspirations for economic growth will still require early release of much more land for development, and accessibility to appropriate and affordable levels of finance.

Adverse possession of land

Under the adverse possession regime a “squatter” can apply to be registered as the proprietor of land if he can prove that he has been in adverse possession for 10 years ending on the date of the application.

A registered proprietor who has been served with notice of the squatter’s application can object and the application must be rejected unless the squatter can establish one of 3 conditions. One of these is that there has been a reasonable mistake regarding the boundaries and that the squatter has reasonably believed that he owned the disputed land for at least 10 years.

In a recent case the Court of Appeal ruled that, in determining if the squatter’s belief is reasonable, the squatter should not be imputed to have the knowledge of his solicitor or his agent since the knowledge of the squatter’s solicitor or agent is not the issue. It may be appropriate to consider whether the squatter should have raised questions of his solicitor or agent, but if there has been no challenge to the squatter’s adverse possession, there has been nothing to put the squatter on notice of a need to raise any point with his solicitor.

Waiver of lease obligation by grant of licence to alter

In a case considered by the Court of Appeal the tenant’s residential lease contained an obligation to keep the flat carpeted. However, the landlord granted the tenant permission to lay an oak floor and under floor heating. In these circumstances the Court held that, by granting the licence to alter, the landlord had waived the obligation to keep the flat carpeted.

This ruling was made in the context of a dispute between neighbours, which often arise deep passions. The Court suggested that very often mediation is the most sensible approach to resolving such disputes.

For landlords the case highlights that a landlord should consider whether it is impliedly releasing a tenant from complying with any obligations under a lease by granting permission for alterations. Other tenants may find themselves adversely affected in such circumstances and as a result the landlord may be in breach of his obligations in other leases, such as a covenant not to waive or release the obligations of other tenants.

Exercise of break clause in lease

The High Court has considered whether a tenant had to pay a quarter’s rent in order to exercise the right to terminate its lease under a break clause. The tenant was required to give 6 months’ notice and to pay the rents due under the lease up to the termination date. The tenant paid an annual rent which was payable in quarterly instalments.

The landlord had issued an invoice for the September quarter’s rent. The tenant replied that it had paid the rent due from 29th September to 12th October and asked the landlord to confirm that this sum was correct. The landlord did not respond.

Subsequently the landlord claimed that the tenant should have paid the full September quarter’s rent by the termination date. The High Court agreed with the landlord and held that the tenant had failed to terminate the lease. A full quarter’s rent fell due on the September quarter day and it was payable in advance. On the due date it was not certain that the lease would terminate on the termination date as the tenant might not comply with the other elements of the break clause.

This case demonstrates that it is advisable for a tenant to pay the full rent and any other sums due to ensure that a break clause is properly exercised. Once the lease has been properly terminated, the tenant should then seek to reclaim sums which it believes should not have been paid.

Sale of land is not a public works contract

The Public Contracts Regulations 2006 prescribe procedures for the procurement of goods, works or services by a contracting authority. The Regulations define a public works contract as a contract for the carrying out of works for a contracting authority or under which a contracting authority engages a person to procure by any means the carrying out for the contracting authority of a work corresponding to specified requirements. The Regulations include a specific exemption for contracts for the acquisition of land.

In a recent judicial review case the High Court ruled that a sale of land by Birmingham City Council to a well-known supermarket chain did not constitute a public works contract for the purposes of the Public Contracts Regulations. The supermarket was not subject to any legally binding obligation to conduct any development works in relation to the land even though it was sold in the context of plans for the redevelopment of a wider site and planning permission for the redevelopment included obligations relating to the replacement of community facilities currently provided on the land sold. The supermarket was not under any obligation to implement that planning permission and start the development works.

The judicial review challenge by a rival supermarket chain was dismissed by the Court.

 

The comments in this note are of a general nature only. Full advice should be sought on any specific problems.

Siobhan Goodacre
sgoodacre@abg-law.com
+44 (0)115 934 3325

Wendy Shaw
wshaw@abg-law.com
+44 (0)115 934 3303