Commercial Property Law Update

Louise Cheung

Following a recent CPD training on Commercial Property Law, I thought it would be prudent to give an update on Commercial Property law affecting practice in development transactions. The training was well attended at the Hilton, Watford on 11th June 2015 by both lawyers and surveyors and garnered some lively debate about recent Property case law.

Here is a summary of my selection of interesting updates to case law:

  • Rights to Light: Salvage Wharf v G & S Brough [2010] Ch 11
  • Restrictive Covenants: Cosmichome ltd v Southampton CC [2013] EWHC 1378
  • Abandonment of Easements: Dwyer v Westminster City Council [2014] EWCA Civ 153

Rights of Light

‘Good Neighbour’ agreements are often entered into between the owners of neighbouring properties when a right of light easement affects development work. Requisite insurance is made to cover the risk of a claim against the obstruction of the right of light. The agreement between the dominant and servient tenement owners allows for the waiver or release of rights of light. This legal agreement thus prevents a light obstruction notice from the servient owner as the document represents consent to the loss of this right of light.

The courts identify that there are two types of clauses to this effect leading to the loss of the right to light; (1) A clause that deals with the position as it exists at the date of the agreement (2) A clause that deals with the position as it might happen in the future. (Salvage Wharf v G & S Brough [2010] Ch 11)

In terms of the Court deciding whether an injunction or damages is suitable for an infringement of the right of light, the Shelfer test (Shelfer v City of London Electric Lighting Company [1895] 1 Ch 287) remains key. This has led to unusual decisions where the court has decided to grant mandatory injunctions requiring developers to demolish floors, despite less than a 1% loss of light and the costs of demolishing costing up to £2.5m, even though the value of the loss of light had been valued at far less. (HKRUK II (CHC) Ltd v Marcus Alexander Heaney [2010] ALL ER (D) 101).

Also note that the Custom of London gives special rules relating to properties on the footprint of foundations of a building which has been demolished in the City of London. There is a right to build to any height irrespective of custom law prescription. A Deed of Release of Rights to Light and Air has been produced by the City of London Law Society, but has not yet appeared on PLC.

Restrictive Covenants

Courts have recently looked at the ways in which local authorities have attempted to use restrictive covenants to enforce overage, if planning permission is obtained to enhance the value of the land. Local Authorities have tried and failed to use restrictive covenants for this purpose. Restrictive covenants have an amenity value and this use of a covenant to enforce overage does not. Accordingly, the burden of the covenant did not run with the land.  (Cosmichome ltd v Southampton CC [2013] EWHC 1378)

 

Abandonment of Easements

The non-use of an express right of way for 40 years was found insufficient to justify a finding of an abandonment of an easement. (Dwyer v Westminster City Council [2014] EWCA Civ 153)

Thank you to Hertfordshire County Council and Professional Conferences for allowing me to attend and contribute to the day.

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