The Supreme Court has rejected the appeal by campaigners against the Aberdeen bypass.

The decision is available here.

The press summary is available here.

A BBC report on the decision can be found here.

Outer House case considering an appeal by North Lanarkshire Council under s239 of the Town and Country Planning (Scotland) Act 1997.  It concerns a planning application by Shore Energy in respect of a waste management and renewable energy plant at Carnbroe near Coatbridge. The Council refused permission for the plant despite a recommendation by planning officials that the proposal be accepted. However, Shore Energy appealed to the Scottish Ministers against the refusal of planning permission. After an inquiry, reporters appointed by the Scottish Government granted planning permission subject to conditions. The Council then appealed to the court under s239.

The crux of the dispute was the relative weight given to local planning and environmental considerations, on the one hand, and national environmental objectives on the other. The Council’s reasons for rejecting the proposals indicate that priority had been given to local considerations whereas the reporters’ decision had treated the national need as a material consideration and regarded local considerations as subordinate to it.

Lord Stewart noted that national policy had evolved after the planning application had been made and that a new policy was launched (without consultation as a “revised annex” to the Scotland’s Zero Waste Plan, 2010) the day before the inquiry. However, no issue was raised about the lawfulness of the policy. The matter for the court was whether the reporters’ understanding and application of the policy was sound and whether they had departed from it. In refusing the Council’s appeal Lord Stewart said:

“The meaning assigned to the new policy by the reporters as I understand it is that the need assessment area is, or at least that one of the relevant need assessment areas is, Scotland as a whole. The policy is quite capable of bearing this meaning. It was entirely reasonable for the reporters to treat national need as a material consideration and, in this case, as the determining consideration subject to any site-specific objections.”

 The full judgement is available from Scottish Courts here.

(See appeal to the Inner House here.)

All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.

Sheriff Court case in which Northern Rock sought declarator that Mr Fowlie was in default and that it was entitled to sell[1] a property subject to a standard security without following the procedure set out in s24(1B) of the Conveyancing and Feudal Reform (Scotland) Act 1970 as the property was unoccupied.

In granting the declarator,Sheriff Mann agreed with the decision of Sheriff Braid in Accord Mortgages Limited v Edwards  in which it was noted that s24 applies only where the subjects are being used for residential purposes and found that, where the subjects are unoccupied, they cannot be said to be being used for residential purposes.

In this case, Northern Rock had lodged both a Field Agent Report and Sheriff Officer Report which concluded that the property in question was unoccupied. Sheriff Mann observed that, as s24 requires the service of notice on the debtor of their right to make representations to the court, if the notice were not served, then a debtor may choose not to oppose an action in ignorance of that right.  As a result, the Sheriff concluded that creditors should not be allowed to raise proceedings by way of declarator by ordinary cause unless they are in a position to demonstrate that, prima facie, the subjects are unoccupied. Here, the Field Agent Report and Sheriff Officer Report had been an appropriate way for the creditor to show this.

The full judgement is available from Scottish Courts here.

All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.

Outer House case considering a motion for recall of inhibitions served on Cordelt Limited and Mako Property Limited by Playfair Limited. Mako and Cordelt argued that the inhibitions prevented them showing clear searches to purchasers in implement of  contracts to sell properties in Edinburgh.

An important issue for the court was whether s160 of the Bankruptcy and Diligence (Scotland) Act 2007 changed the law regarding the effect of an inhibition on a pre-existing contract to convey property. Under the prior law it was clear that an inhibition did not prevent the transfer of property in implementation of a contract that pre-dated the inhibition. After detailed consideration of the 2007 Act and Scottish Law Commission’s Report on Diligence, Lord Hodge found that the law had not changed in this respect. He also noted that if (and he doubted that it had) advice from Registers of Scotland had indicated otherwise then he would respectfully disagree with that advice. Although s160 defines a breach of the inhibition as occurring when a debtor delivers a deed conveying property over which the inhibition has effect, it does not strike at a deed in implement of a pre-existing obligation.

“I conclude that an inhibition does not strike at a transaction which the inhibited person is bound to carry out as a result of a pre-inhibition obligation. The reforms of the 2007 Act did not create a statutory code which excluded that common law characteristic of the diligence. Had the 2007 Act had that effect it would have created a diligence which forced the inhibited person either to breach the inhibition or break his contract. That would not have been good law reform”

The full judgement is available from Scottish Courts here.

All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.

Decision of the Lands Valuation Appeal Court regarding an appeal by the assessor against a decision of the Dundee Valuation Appeal Committee. (After noting that strict adherence with the legislation would create a situation that was inequitable and unfair) the Committee had allowed 49 appeals by Land Securities and others against the valuation of shops in the Overgate Centre in Dundee on the basis that a fall in the retail rental values caused by the recession (agreed to have happened on 1 April 2009) amounted to a material change in circumstances after the valuation date. The valuation date was 1 April 2008 and took effect two years later on 1 April 2010.

The issue for the court was whether a material change of circumstances which had occurred during the 2005 roll at a date (agreed to be 1 April 2009) after the valuation date for the 2010 roll should be reflected in the 2010 roll. The ratepayers did not argue that the values entered on the 2010 roll should be reduced due to a supervening material change of circumstances. Instead their contention was that the values should not have been entered into the roll in the first place.

 This argument did not find favour with the court. The Lord President said:

 “In my opinion, this argument is fallacious. It overlooks the basis on which a revaluation is carried out. It confuses the date at which a value has to be struck with the date on which it will come into force. The fundamental principle on which a revaluation is carried out is that all of the lands and heritages entered in the new roll are valued to a common base. With one exception, there is no warrant in the legislation for the assessor’s adjusting tone date[1] valuations in respect of changes in value that occur between the tone date and the revaluation date. Inevitably, there will be increases and decreases in the values of various groups or classes of lands and heritages during that period; but for there to be consistency in the roll it is essential that all lands and heritages in the new roll must be valued as at one fixed date. The exception is the power given to the assessor in section 1(6)(c) of the 1975 Act (supra) to take account of a material change of circumstances in the period after the roll has been made up and before it has come into force.”

Appeals can be made under s 3(2) and 3(4) of the Local Government (Scotland) Act 1975. The right of appeal under section 3(4) extends to a material change of circumstances occurring between the date of delivery of the roll and the date on which the roll comes into force. It does not apply to a material change of circumstances occurring before the entry was made.

Section 3(2) also provides a general right of appeal against a new entry. It would have been open to the ratepayers to appeal under section 3(2) (within the 6 month time limit) in respect of a material change of circumstances occurring after the date of delivery of the roll. That did not assist the ratepayers in this case. The change of circumstances on which they relied had affected values by 1 April 2009 and there was no suggestion that the 2010 roll had been made up by that date.

The court allowed the assessor’s appeal and recalled the decision of the Committee.

The full judgement is available from Scottish Courts here.

A similar decision was reached in respect of properties at the Mercat Shopping Centre in Kirkcaldy in The Assessor for Fife v. Mercat Kirkcaldy Limited and others. The full text of that judgement is available here.

All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.

Judicial Review of the City of Edinburgh Council’s decision to appropriate part of Portobello Park to build a new Portobello High School.

In the Outer House Lady Dorrian had dismissed a petition for Judicial Review by the Portobello Park Action Group Association. The Action Group argued that it was unlawful for the Council to appropriate the park land which is common good land. Lady Dorrian dismissed the petition on the basis it was barred by mora, taciturnity and acquiescence (i.e. the Action Group had delayed their action, failed to speak out and impliedly accepted the position.) As the petition had been barred, Lady Dorrian did not have to decide on the lawfulness of the Council’s decision, however, she indicated that, if she had been required to do so, she would have found in favour of the Council. Her reasoning was that, whilst the Council’s power to alienate common good land is limited, its power to appropriate such land is unfettered, meaning that its Children and Families Department  could appropriate the park land from its Services for the Community department.

The Inner House has now allowed an appeal of the Outer House decision.

Mora, taciturnity and acquiescence
Lady Dorrian had found that (although it was unclear exactly when the decision to appropriate the park had been reached) “at the very latest” the decision had been made in March 2010. As the Action Group did not bring the case until July 2011 there had been considerable delay which was indicative of taciturnity and acquiescence. On the other hand, the Inner House held that the Action Group was, at the very least, entitled to wait until planning permission had been granted (which occurred in February 2011) before resorting to litigation. It was observed that, if planning permission had been refused, the dispute would have been at best premature and at worst academic and pointless. The Inner House also considered the Action Group’s behaviour, noting:

“The regular statements over the years of the Association’s reasons for their opposition can scarcely be characterised as “taciturnity”. Moreover, bearing in mind the conduct, letters, e-mails, and deputations noted in the chronology in paragraph above, we are unable to accept that there were circumstances entitling the reasonable observer to draw any inference that the Association had at any stage acquiesced in the Council’s proposed intention to construct a new school on Portobello Park. On the contrary …there was a steady and unwavering opposition for the clearly articulated reason that the ground in question was inalienable common good land.”

Appropriation and alienation
After considering the Council’s powers of appropriation and disposal of land contained in sections 73 to 75 of the Local Government (Scotland) Act 1973, the Inner House found:

 “..we are, with great respect, unable to support the Lord Ordinary’s reasoning and conclusions in this area. To our mind there is no question of a local authority’s right to appropriate inalienable common good land (such as the southern section of Portobello Park) being unfettered. On the contrary, the true position would appear to be that, for so long as inalienable common good land remains within the ownership of a local authority, Parliament must be taken to have intended all pre-existing fiduciary obligations, and corresponding community rights, to remain extant and enforceable. It would indeed be an extraordinary situation if, by the mere expedient of appropriating inalienable common good land to some function other than parks and recreation, a local authority could at a stroke free itself from all common law restraints and, having done so, perhaps also facilitate onward disposal without any need to obtain the sanction of the court under section 75(2). In the absence of clear authority requiring us to affirm such an apparently unreasonable state of affairs, we are not persuaded that we should go down that line. We therefore hold that, for present purposes, the Council can lay claim to no statutory power of appropriation under the 1973 Act.”

The full judgement is available from Scottish Courts here.

All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.

Outer House case considering whether a rating authority was entitled to levy rates on the owner of a newly erected and unoccupied building without first having served a completion notice (under schedule 3 to the Local Government (Scotland) Act 1966) on the owner.

Cosmopolitan and Almondvale argued that demands for rates at office premises in Bellshill were illegal as the Council had not served a completion notice on them to establish a deemed date of completion of the office. As such they sought repayment of £289k on the grounds of unjustified enrichment.

However, Lord Hodge held that the action by Cosmopolitan and Almondvale was irrelevant. He found that the language in the 1966 Act did not indicate that the completion notice procedure was intended to be the only method by which the owner and rating authority could establish the date of completion of a building. There was also no policy reason for adopting such an approach.

Taken together, s24 of the 1966 Act and regulation 2 of the Non-Domestic Rating (Unoccupied Property) (Scotland) Regulations 1994 require the levying of rates on all relevant buildings which have been unoccupied for a continuous period of more than three months. In order to be classified as unoccupied for rating purposes a newly erected building must be complete in the sense that it is capable of occupation. The date of completion of a building is a question of fact and is one which the rating authority and the owner can agree upon or contest in litigation. The completion notice procedure provides an additional mechanism by which a rating authority can establish an undisputed deemed date of completion.

The full judgement is available from Scottish Courts here.

All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.

Two Inner House cases in which Cheshire Mortgage and Blemain Finance were the victims of a mortgage fraud and sought to sue the solicitors instructed by the fraudsters  (the banks had instructed separate solicitors) for breach of warranty of authority.

In each case the fraudsters had pretended to be persons owning property which they were seeking to use as security for a loan (of £355,000 in one case and £203,000 in the other).  They had been able to produce evidence of their identity in the form of utility bills and driving licences to their solicitors and to the banks.  In both cases the fraudsters had approached the bank (directly in one case and via a broker in the other) before instructing their solicitors.

The banks argued that, in each case, the solicitors warranted that they had the authority of the individuals who owned the properties over which standard securities were purportedly granted. The solicitors recognised the doctrine of a solicitor giving an implied warranty of authority. However, they contended that it does not go as far as giving a warranty of the identity of the person for whom they act, nor does it include any warranty as to whether he is or is not the owner or occupier of any particular property. In effect the solicitors said that they warranted only that they had authority from persons who were already known to the banks and with whom the banks were already dealing.

Outer house
In the Outer House Lord Glennie found in favour of the solicitors. The circumstances in which the solicitors came to transaction were of particular importance. By the time the solicitors became involved, the banks knew who they were (or who they thought they were) dealing with. They had already made the decision to lend to those individuals. The solicitors had been instructed (by the fraudsters) for the limited purpose of drawing up the loan and security documentation and liaising with the banks’ solicitors.

In one of the cases there was also discussion as to whether the solicitors were liable to the bank in terms of the letter of obligation they had granted. The bank argued that they suffered loss as a result of the solicitors’ failure to procure the title deeds recording the security in terms of the solicitors undertaking. However, Lord Glennie again agreed with the solicitors’ arguments on this point:

1. the letter of obligation was collateral to the principal transaction between the bank and the borrowers and could not be enforced if that principal transaction was void; and
2. in any event, the bank could show no damages flowing from the failure by the solicitor to produce a title encumbered with the Standard Security, since the Standard Security referred to in the letter of obligation was itself void.

 The Inner House refused an appeal of Lord Glennie’s decision.

Inner House –agent’s authority
An agent’s warranty authority is of limited scope. Whilst an agent will impliedly warrant that he has authority to act on his client’s behalf it does not follow that he warrants the identity of his client nor the client’s title to the property in question. Although it would be open to the agent to expressly warrant these things, it is almost inconceivable that the agent would agree to this. The court should not readily impose upon a person rendering professional services an absolute, unqualified obligation amounting, in effect, to a guarantee of his client’s identity and title. Where the risks are commercial risks involved in lending to a person who may not be all he claims to be, there is no reason why the risks should be transferred from a commercial firm to a professional firm such as a firm of solicitors.

Inner House –letter of obligation
The Inner House agreed that the letter of obligation was collateral to the void security transaction (and consequently unenforceable). Also (although it may simply have been another way of expressing the same thing) the Inner House agreed that the bank could show no loss since the obligation to which the letter was ancillary was void.

The full judgement is available from Scottish Courts here.

All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.

Case from Manchester Crown Court concerning the prosecution of a letting agent and building owner for failing to carry out an asbestos assessment at Brownlow Mill on Tennyson Street in Bolton.

Several small businesses rent units at the mill and, after a contractor had raised concerns that asbestos insulation boards had been ripped out of unoccupied floors of the building, inspectors discovered that asbestos was also present in parts of the building occupied by the tenants.

Although the letting agent had raised the issue of a lack of an asbestos assessment in 2006, they did not follow it up and no asbestos survey was carried out.

The letting agent and the owner both pled guilty to a breach of the Health and Safety at Work Act 1974 in respect of their failure to ensure the safety of the people at the mill. The owners had also breached the Control of Asbestos Regulations 2006 by failing to properly assess the risks of asbestos at the site.

The letting agents were fined £15,000 (and ordered to pay costs of £11,011). The owner was fined £40,000 (with costs of £8,969).

The press release from the Health and Safety Executive is available here.