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Rates – revaluation

The business rates revaluation that came into force on 1 April 2017 has caused much controversy. In part, this is because RVs are based on the rent payable for the premises – and there have been significant rent increases in recent years (especially in London and the south-east). Revaluations are supposed to recur every five years, but the 2015 revaluation was delayed.

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Rates – refurbishment

The Supreme Court has handed down a judgment that will be welcomed by all commercial property developers. The court has reversed the previous CA decision and held that only nominal rates have to be paid when a building is being redeveloped.

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Local authorities – best price

Section 123 LGA 1972 requires an LA to sell land at the ‘best’ consideration. Similarly, s233 TCPA 1990 says the land must be sold for the ‘best price’. Under the 1972 Act, there is an exception if the undervalue element of the sale is no more than £2m, provided the disposal will contribute to economic, social or environmental wellbeing. In practical terms, this ‘wellbeing’ exception will nearly always apply – so the end result is that there is a general consent for disposals when the undervalue element is no more than £2m (that is not a significant amount in today’s property market).

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Japanese knotweed – private nuisance

In the March 2017 issue, we noted an important county court decision which held Network Rail liable after Japanese knotweed grew close to neighbouring terraced houses. The owners of the properties had been ‘trapped’ by knowledge of knotweed, and could not sell because banks and mortgagees would not grant mortgages on affected properties. It was held that Network Rail was liable in private nuisance and had to pay damages.

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Section 2 – contracts

It is well known that any contract for the sale of land must be in writing, and it must incorporate all the terms the parties have agreed. That document must then be signed by the parties (s2(1) Law of Property (Miscellaneous Provisions) Act 1989).

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Private right of way – erection of gates?

The obstruction of a private right of way must be ‘substantial’ to be actionable. But, an interference will not be ‘substantial’ if the right of way can be ‘practically and substantially exercised as conveniently’ as it was before ([Hutton 1860]).

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Deposit – return

Section 49 LPA 1925 says ‘the court may, if it thinks fit, order the repayment of any deposit’. But, the court is likely to take a hard approach. This is well illustrated by a recent case where, one week before completion, the seller was told by the buyer that he might be late completing because of delay in funds coming from Nigeria. The seller then made two offers to put back the date of completion, in return for a modest increase in price. That was not agreed, so when the completion date arose, notice to complete was served. Unfortunately, the funds did not come through until one day after the deadline, so the seller forfeited the buyer’s deposit of £430,000 – and then sold elsewhere for a profit.

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Rates – appeals

Many landowners (especially in London) can expect substantial increases in business rates as a result of the latest revaluation. If in doubt, it is important to appeal that revaluation as soon as possible.

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Rentcharges – beware

If a client buys a property subject to a rentcharge then be sure to give clear and emphatic advice about the importance of never allowing rentcharge payments to fall into arrears.

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Public rights – signage

There has been much emphasis in recent years on the importance of erecting signs to prevent rights of way arising by prescription. In particular, readers may remember the case of the Conservative Club whose forecourt was used by customers of an adjoining fish and chip shop; it was held that the clear sign (‘private carpark’) was sufficient to prevent a private right of way arising. (See Winterburn [2016] – noted in our July 2016 issue, p14).

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