Commercial Property Update – August 2023

Posted: 2nd August 2023

Key Dates

4th July – As mentioned in July’s update, the Responsible Actors Scheme Regulations was made. Originally earmarked for the end of summer 2023, this came into effect on 4th July 2023.

25th July – On 25th July the Government announced the opening of the Cladding Safety Scheme (CSS). The CSS is available for residential buildings over 11 metres tall outside London and between 11 and 18 metres inside London. It will cover the reasonable costs of addressing life-safety fire risks associated with cladding and external wall systems where recommended in a Fire Risk Appraisal of External Walls.

Formality Updates

Companies House

Companies house recently published guidance on how it will enforce powers in relation to the registration of overseas entities.

Enforcing compliance – Where compliance is not achieved through help and advice, Companies House will take a consistent and proportionate approach to enforcement, including, where necessary, imposing restrictions on properties, issuing civil financial penalties and prosecution of criminal activity. When considering the most appropriate method of enforcement, Companies House will take account of and balance the risk posed to people and the economy, the seriousness of the breach, the impact on the economy, people or the integrity of the register, the cost and benefit of taking enforcement action and whether it is in the public interest. Resources will be prioritised according to intelligence, focusing on offences where there has been persistent, repeated and wilful non-compliance.

Warning notices – The Registrar may issue a warning notice if they suspect an offence has been committed. This will include details of the grounds for suspecting an offence has been committed, give the recipient at least 28 days (beginning on the day after the date of the notice) to make written representations (by post or emailing [email protected]) and warn that a penalty may be issued if contact is not made within the specified period, or if the representations provided are not accepted.

Determining financial penalties – The amount of a financial penalty will be assessed by reference to the culpability and the harm involved in each case. Factors relevant to culpability include evidence of intent and previous penalties or conduct. For offences relating to the register, the value of an entity’s property portfolio will be used as an estimate of the size of harm. The value of each property will be estimated based on data including council tax bands, business rateable value, and the House Price Index, to give a low, medium or high penalty rate for each property. The total penalty will reflect the value of the whole property portfolio. The Registrar will also consider any aggravating or mitigating factors that may make the offence more or less serious, including any information provided to the Registrar after issuing a warning notice. A financial penalty may be varied or revoked after issue.

Land Registry

The Land Registry has updated Practice Guide 24: Private trusts of land to clarify that a Form B restriction is appropriate only where the disposition creating the trust of land limits the trustees’ powers, not to simply give notice of a trust.

Recent Cases

URS Corporation Ltd v BDW Trading Ltd [2003] EWCA Civ 772

The Court of Appeal held that a developer had a valid cause of action in tort against a design consultant for alleged defects in two residential tower blocks.

In the News

Marks and Spencer’s have been in a battle with the Secretary of State. M&S recently unveiled plans to demolish their iconic Oxford Street Store and rebuild the store and build new offices. Last year, Michael Gove ordered a public enquiry into the plan. Climate change campaigners argued that 40,000 tons of C02 would be released into the atmosphere if the project were to go ahead.

This month a decision was made. Despite a recommendation from inspectors to improve the plans, the Secretary of State refused permission for M&S to develop the store. M&S have described this as a shortsighted act of self-sabotage and they are now considering the store’s future on the iconic shopping street.