Property litigation weekly update - 26 March 2021
We had the anniversary of the first lockdown this week but we have also hit another (happier) milestone! It has been one year since the first edition of our Property Litigation bulletin. Each week we have been providing our readers with property updates, positive news and various insights from across Trowers & Hamlins.
We have produced 47 issues and around 40 of our fantastic national team have contributed. If you would like to see the faces of those behind the bulletin, please click here.
We hope our readers continue to find the bulletin informative and that you enjoy this week's anniversary edition. To celebrate, we have included a bumper selection of positive news stories!
Extension of moratorium on use of statutory demands and winding-up petitions
The government yesterday announced an extension until 30 June 2021 to the moratorium on the use of statutory demands and winding-up petitions to protect companies from creditor enforcement action due to debts related to coronavirus. This is in line with the extensions we reported earlier this month to the moratorium against forfeiture and the changes to the Commercial Rent Arrears Recovery (CRAR) procedure. To view the bulletin we reported this in, please click here.
In addition, the government has extended to 30 June 2021 the provision allowing small suppliers the ability to suspend supply to a business in insolvency. Regulations in the Corporate Insolvency and Governance Act 2020 would otherwise outlaw all termination clauses where a business enters an insolvency procedure.
The relaxation of the rules relating to entry into the new moratorium insolvency procedure will also remain in place until 30 September 2021.
Shared ownership leaseholders qualify for Right to Manage
The Commonhold and Leasehold Reform Act 2002 provides the right for certain residential leaseholders to acquire the management of their block of flats. Leaseholders do not have to pay a premium and are entitled to exercise this right even if there is no fault in the present management. However, there had previously been uncertainty as to whether shared ownership leaseholders qualified for this Right to Manage.
The recent case of Avon Ground Rents Ltd v Canary Gateway (Block A) RTM Company Ltd & Anor (2020) UKUT 358 (LC) has provided further clarification on the point, confirming that shared ownership leaseholders qualify for the right even where they have a less than 100% share. This was decided on the basis that shared owners have a lease of more than 21 years, being one of the other qualifying gateways under the legislation. The case also confirmed that a housing association owning a number of socially rented residential flats under a headlease, also qualified for the right to manage and must be served with the notice of invitation to participate in the right to manage.
The Law Commission's recent proposals to reform the Right to Manage are based on the objective of expanding the right to more properties. This decision echoes those intentions (albeit the ruling was based purely on principles of statutory interpretation). It could also have wider implications as to whether shared ownership leaseholders qualify for lease extensions or collective enfranchisement under the Leasehold Reform, Housing and Urban Development Act 1993, because the 1993 Act contains the same gateway provisions.
Passageways and adverse possession: Amirtharaja and another v White and another  EWHC 330
This case is a reminder of the essential elements required to prove adverse possession, namely actual possession and an intention to possess the land to the exclusion of the owner. The High Court ruled that merely adding a locked gate to a passageway did not amount to an intention to possess since the locked gate, in this case, was to control access rather than to exclude the owner.
In this case, a dispute arose over ownership of a passageway situated between two commercial units owned by the Appellants and located at the rear of the Respondents' garden. The County Court had previously declared that the Respondents were entitled to be registered as owners of the Passageway, in place of the Appellants, by reason of their adverse possession. Reliance was placed on a 2017 statutory declaration and evidence provided by the previous owner of the Respondents' property, who was a close friend of the Respondents, and which was prepared after the dispute as to ownership of the passageway arose.
On appeal, the High Court overturned the decision of the County Court on the basis that the necessary intention to possess had not been proved. It was considered that the evidence suggested that the intention was only to protect a right of way rather than to possess the passageway. The Judge also held that too much weight had been given to the 2017 statutory declaration above an earlier statutory declaration and evidence at the time of first registration, highlighting the importance of contemporaneous evidence over potentially 'self-serving' declarations made for the purpose of proceedings.
Energy Efficiency Standards for non domestic private rented buildings
In 2015 the Government introduced minimum energy performance standards (MEES) to improve energy performance for the worst performing buildings. Following this, in 2019, the Government consulted on proposals that would improve energy performance of non domestic private rented buildings. The consultation set out a long term trajectory requiring all non domestic rented buildings to meet an Energy Performance Certificate B by 2030 in order to reduce emissions and drive clean growth for the future. The consultation estimated to improve the efficiency of around one million non domestic buildings.
The government has now issued a consultation, ending on 9 June 2021, which considers ways to implement the EPC B option and how to improve the compliance and enforcement process.
The government proposes there should be;
- Phased implementation of the EPC B by 2030 requirement, with EPC C by 2027 set as an interim milestone;
- The introduction of two- year compliance windows;
- A move away from enforcement at the point of letting.
The government has proposed that this overall framework will be supported by various enforcement reforms.
Insight from our colleagues around the firm
- Podcast: Electronic Communications Code: Considerations for Site Providers
- Webinar: Private residential development briefing – The future of residential in cities - A re-assessment?
- Webinar: Sustainability and Net Zero 2050 – where to start?
- Affordable housing – pressures; innovations and impacts
- Report: Positioning cities for inclusive growth
Positive news stories
While Covid-19 continues to dominate news headlines across the globe, there have still been some uplifting stories:
- An arctic walrus has been spotted at the bottom of a Welsh cliff, just days after it was seen off the coast of Ireland. View the full story here.
- Chimpanzees at two Czech zoos are, like the rest of us, staying in contact via Zoom. View the full story here.
- The Bank of England has voiced some cautious optimism about the UK economic outlook in the wake of the sharp fall in coronavirus infections and the rapid rollout of COVID-19 vaccines. View the full story here.
- The famous Robert Capa photo that brings new life to a tenement and its residents. View the full story here.