Real Estate Bulletin - Autumn 2017

A welcome from the editor...Welcome to the autumn edition of the Real Estate Bulletin.

This quarter, we look at how the Valuation Office treats cash machines and how failure to treat the dreaded Japanese Knotweed can lead to liability. We’ve some cases on easements, covering the extent of benefiting land, at what point you can or can’t enter your property from a driveway and what happens when an easement to commit a nuisance arises. We also look at assigning the benefit of a contract (or not), a refusal by the Court of Appeal to open the floodgates on discharging restrictive covenants and how de-listing an Asset of Community Value can occur. For landlords and tenants, we look at when a landlord can refuse consent to a change of use and the age-old question of is it a lease or is it a licence? The planning points cover Section 106 Agreements and a couple of cases about statutory maintenance notices.The Bulletin brings together highlights from our popular quarterly update training sessions, so if you are local to the East Midlands or pass through every now and again and would like details of our next event in December, please get in touch.

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CASE LAW UPDATE Business rates – Cash machines: Sainsbury’s Supermarkets Ltd v Sykes (Valuation Officer)Key points

• ATM sites are separate hereditaments for rating purposes
• Who is responsible for paying the rates depends on the location of the machines
• Contracts – assignment of benefits: General Nutrition Investment Co v Holland & Barrett International Ltd Key points
• Contracts are often transferred in a business context. There are various formalities for assignments; these will be set out in the contract itself but there may also be statutory requirements. In order for an assignment to be legally effective, Section 136 of the Law of Property Act 1925 must be complied with (in short, written notice should be given)Development – Assets of Community Value: New Barrow Ltd v Ribble Valley Borough Council (Community Right to Bid) Key points
• The Localism Act 2011 introduced a ‘community right to bid’ for local amenities such as village stores and pubs
• Community interest groups can apply for such amenities to be listed as assets of community value (ACV)If the owner of a building that has been listed as an ACV wants to sell it, it must give community interest groups time to bid for the property and raise the funds to buy it before selling on the open market
• Easements – extent of benefiting land: Gore v Naheed & AnotherKey points
• It was established back in 1904 that a right of way granted for the benefit of property A cannot be used, in substance, for the benefit of property B, because extending the access to property B imposes an additional burden, which is potentially outside the scope of the grant. However, if the use of property B is merely ancillary to the use of property A, the right may fall within the grant.
• Easements – right of way: Shaw v GroubyKey point
• The extent of an easement is determined by its physical extent, the purpose and manner of its use and any limitations on that use
• Easements – right to commit nuisance: Peires v Bickerton’s Aerodrome Ltd Key points
• Easements can arise by long user, known as prescription. Following the Supreme Court decision in Coventry v Lawrence, landowners can acquire prescriptive rights to commit a noise nuisance
• Remedies for aggrieved neighbours could be an injunction preventing the nuisance or, more usually, damages that reflect the diminution in value of the neighbour’s property Autumn 2016 bulletin.
• Readers may remember that P lived in large house adjacent to an aerodrome owned by BAL.P accepted that a certain level of noise would emanate from the aerodrome, but contended that the noise of helicopters carrying out a specific training operation at a spot close to the boundary with her property was excessive and unreasonable. P claimed that the noise was a nuisance and seriously affected her enjoyment of her property in respect of the garden and the major parts of the house. The main living room and bedrooms faced towards the aerodrome and the noise from the helicopters was very different from other activities, being extremely loud and continuing for what P argued were unacceptable periods. In addition, a potential buyer of the property (Tess Daly of Strictly Come Dancing fame) was apparently put off the purchase when she went out into the garden and heard the noise.BAL argued that the area where training was carried out was uniquely useful for that operation (it took place on a sloping area of land) and was only place where it could be carried out to meet the training requirements.P and BAL disagreed about frequency of training - BAL said the training activity took place on average 1.5 times a week for 15 minutes or so each time but P argued it was far more frequent, carried on for an unreasonable length of time, was unpredictable and was interfering with enjoyment of her property.BAL argued it had acquired a right to commit a nuisance by prescription as the helicopter activity commenced in the early 1960s. In the High Court, P was successful in getting an injunction that restricted the training operations to limited times during the week and to limited areas of the aerodrome and that’s where we left it last year.BAL then appealed. One of the defences raised by BAL in the High Court was that it had statutory immunity against nuisance claims caused by aircraft in flight (Section 76(1) of the Civil Aviation Act 1982 for any plane spotters out there). The High Court judge dismissed this defence on the basis that the training activities were not “flights” but the Court of Appeal disagreed with the judge’s interpretation of the Act.Practical implications:This seems to take us back to the Lawrence v Coventry position that damages are to be more readily awarded in lieu of an injunction in nuisance claims, although BAL succeeded due to the application of aviation law, which obviously wouldn’t save other operators of noisy businesses.Noise disturbance may result in substantial damages to reflect the capital diminution in value of neighbouring properties due to noise nuisance.

Environmental – nuisance – Japanese Knotweed: Williams v Network Rail Infrastructure Ltd and Waistell v Network Rail Infrastructure Ltd

Key points

Japanese Knotweed is highly invasive and its presence on or near to properties can render them unmortgageable and therefore potentially unsaleable Property owners need to take appropriate steps to stop Japanese Knotweed not only from encroaching onto adjoining properties but also to prevent its growth close to boundaries Development – discharge of restrictive covenant – Stafford Flowers v Linstone Chine Management Company Ltd Key points

Where land is burdened by restrictive covenants, a landowner can make an application for the covenant to be modified or discharged if certain criteria are satisfied

When considering such an application, the Tribunal may take account of whether granting the application will be the ‘thin end of the wedge’Each case will turn on its facts, but there is a growing body of caselaw that gives guidance to developers on how the Tribunal might approach individual applications

LANDLORD AND TENANT ROUND UP Assignment - buy-back clauses: TCG Pubs Ltd & Another v The Art or Mystery of the Girdlers of London Key points

• In certain sectors, it is common to see “buy back” or “offer back” clauses in leases
• These clauses require a tenant to offer the lease back to the landlord before seeking consent to assign the lease to another tenant
• TCG had triggered the buy back clause;
• TCG had made a valid application to assign; and
• AMG had unreasonably withheld consent by requiring a rent deposit from the proposed assignee.