Clarke and Son News

In Fidler V Secretary of State for Communities and Local Government [2010] EWHC 143 (Admin), a landowner built a house without obtaining planning permission and concealed it behind bales of straw covered with tarpaulin.  After four years, the landowner removed the straw bales and the tarpaulin to reveal the house.  Within a year of the bales being removed, the local planning authority issued an enforcement notice requiring the landowner to demolish the house.

The landowner claimed that the property was immune from planning enforcement action because more than four years had passed since the building operations were substantially completed.

The High Court held that the erection and removal of the bales and tarpaulin were not building operations in their own right.  However, the landowner had always intended to remove the bales and tarpaulin so, as a matter of fact and degree, their removal was part of the building operations when the totality of the operations as originally contemplated and intended was considered. The property was not immune from planning enforcement action.

At first glance, the decision that taking down a wall of straw bales amounts to building operations appears to be surprising. However, it is a good illustration of the holistic approach take by the House of Lords in Sage v Secretary of State for the Environment, Transport and the Regions [2003] UKHL 22 and makes it clear that the meaning of “building operations” for the purposes of section 171B of the Town and Country Planning Act 1990 (TCPA 1990) is wider than the definition set out in section 55 of the TCPA 1990.

For advice and assistance relating to developments please contact Charles Marchant-White or Chris Lockley on Tel: 01256 320 555.

Zurich Insurance plc has confirmed that Zurich Building Guarantee has decided to withdraw from the new home warranty and building control markets. It will honour its existing commitments to its customers, but is closed to new business.

Zurich has confirmed that its decision took effect from 30 September 2009, but the decision has not been widely publicised by Zurich or widely reported. This is an important development in the market for new home warranty products, as Zurich were one of the main providers of those products.

If you are a residential property developer, you will no longer be able to obtain the Zurich Building Guarantee for new sites.  If you are purchasing a new residential property, or a property which has been converted, where a Zurich Building Guarantee is on offer, Zurich has confirmed that it will issue policies and certificates in the normal way, as sites and properties already registered with it are commenced and completed.

For further information on Moving Home, Mortgage and Property Services, contact Paul Cowdery on Tel: 01256 320 555.

You will no doubt be well aware of the main provisions of the Chancellor’s pre-budget report. However the following are of particular significance:

• VAT is to return to 17.5% from 15% from 1st January 2010.  The 15% rate can still be used for services provided up to 31st December 2009.  When we are preparing our bills for you we will, where appropriate, provide apportioned accounts.

• The increase in the Stamp duty land tax threshold on residential properties from £125,000 to £175,000 will come to an end on 31st December 2009. The critical date is the completion date of the transaction which is normally (although not always) the date on which the purchase money for the property is paid and the buyer moves in.

Please note this office will close at 5pm on Wednesday 23rd December 2009 and re-opens on Monday 4th January, 2009 at 9am. The last date we would recommend for completion of a property purchase would be Tuesday 22nd December 2009.

For more information on moving home, mortgage and property services, please contact Paul Cowdery on Tel: 01256 320 555.

Falling house prices may seem like something of a memory, at least for some.  The Nationwide index showed a seventh consecutive monthly rise in November, by 0.5%, taking the price of an average house to £162, 764.  This is 2.7% higher than this time last year and means prices are back where they were in early 2006.  But improvement in the housing market is not uniform across the UK.  According to Hometrack, the strong growth in sales and prices is concentrated predominantly in London and the South East.  Buyer demand does appear to be softening though, which could mean the upward pressure on prices may weaken in the months ahead.*

 Paul Cowdery, Partner & Head of Conveyancing comments:

“Although the market has been stronger than anticipated in the past six months, the feedback we have from most local agents for the year ahead suggests that there is still a large amount of caution as to prospects for the housing market generally and for price stability in the year ahead.  What is causing concern is the impact of a number of uncertainties (e.g. the election, unemployment, the extent of tighter credit controls) which will come into play.  At Clarke & Son, we are continuing to focus our efforts on reviewing the title and supporting paperwork promptly to ensure everything is satisfactory and then moving transactions forward as smoothly as possible to exchange and completion once we are satisfied and our clients are happy to proceed.”

For more information on moving home, mortgage and property services, please contact Paul Cowdery on Tel: 01256 320 555.

*Source: The Chief Economists Weekly Brief from the Royal Bank of Scotland

You may recall that the 2009 Budget announced that the temporary increase in the SDLT threshold to £175,000 for residential properties would continue until 31st December 2009, instead of ending on 2nd September 2009.

In September 2008, the SDLT threshold for land transactions consisting entirely of residential property, increased from £125,000 to £175,000. The revised threshold applies to transactions that have an effective date* (normally completion) between 3rd September 2008 and 2nd September 2009 inclusive. The effect of this temporary increase was to exclude residential transactions for chargeable consideration of up to (and including) £175,000 from a charge to SDLT. The change to the threshold was referred to as an SDLT “holiday”.

The Government announced that the ‘holiday’ would not end on 2nd September 2009, but would instead continue until 31st December 2009. The SDLT threshold will return to £125,000 for transactions with an effective date of 1st January 2010 or later.

As matters stand there is no proposal to extent the SDLT holiday but this may come up for consideration again in the pre-budget review in October or November.

For more information on buying and selling your home, please contact Paul Cowdery on Tel: 01256 320 555

*The effective date of a land transaction is the date of completion. The effective date may, however, be brought forward where there is substantial performance.

On 21 April 2009, the Prime Minister, Gordon Brown, announced the launch of the UK Homeowners Mortgage Support Scheme (HMS), which is now available to borrowers.

The Scheme is designed to give homeowners suffering from a temporary loss of income breathing space. Eligible borrowers will be able to reduce their monthly mortgage interest payments for up to two years without being at risk of losing their home during that time.

The Lenders participating in the Scheme are: Lloyds Bank Group (which includes Halifax and Bank of Scotland), Northern Rock, the Royal Bank of Scotland (which includes NatWest and Ulster Bank), Bradford and Bingley, Cumberland Building Society, and the National Australia Bank Group (which includes Clydesdale and Yorkshire Bank).

A number of other banks, building societies and specialist lenders have also confirmed that they will offer their customers HMS as soon as possible. These are Bank of Ireland (which includes Bristol and West), GMAC, GE Money, Kensington Mortgages, the Post Office and Standard Life Bank.

Lenders offering HMS will have the security of a Government guarantee if the borrower defaults.

At the same time, four other high street lenders, Barclays (including First Plus), HSBC, Nationwide and Santander (including Abbey and Alliance and Leicester) have all confirmed today they will offer comparable arrangements to HMS to their customers, while opting not to take up the Government guarantee. Customers of these institutions experiencing a reduction in income and willing to make regular monthly payments will receive a similar level of support and be encouraged to seek independent money advice.

Borrowers who are interested in applying for Homeowners Mortgage Support, or finding out about comparable arrangements should contact their lender in their first instance to check their eligibility.

For lenders offering HMS with the Government guarantee, the borrower must:

• Have bought their home before 1st December 2008;
• Be an owner-occupier - the scheme is not open to buy-to-let or investment properties
• Have an outstanding mortgage of less than £400,000 and savings of less than £16,000.
• Have a regular household income and should be able to make a minimum contribution of 30 per cent of the total interest payment
• Have talked through other options with their lender and have been making regular payments for at least five months.
• Have sought independent money advice.

The Government will continue to work with smaller lenders to encourage them to either offer the Scheme to their customers, or put comparable arrangements in place.

For more information on Buying and Selling your Home or Re-Mortgaging, please contact Paul Cowdery on Tel: 01256 320 555

It is becoming clear that after April 6th, one of the key issues determining whether a property may be marketed will be the return of the completed Property Information Questionnaire. These forms must be filled out by the seller and returned to the HIP provider before a property may be marketed. 

Current legal position

It is apparent that some HIP providers are trying to convince sellers to pay for documents to be refreshed in HIPs that are a year old. However, searches and title information only need to be refreshed if a property is taken off the market a year after it was first marketed and then remarketed again.

The Partnership, a supplier of Home Information Packs, has produced a helpful summary sheet which summarises the current legal position and can be downloaded from; http://www.thepartnershiplimited.com

If you would like more information on Home Information Packs and the legal aspects of buying and selling your home, please contact Paul Cowdery on Tel: 01256 320 555.

In view of the continuing poor economic data, the Monetary Policy Committee faces a difficult decision when it meets this week. The view has been expressed that the Bank Rate will be kept on hold at 1%, and that the Bank of England will instead press ahead with asset purchases to bring down the cost of borrowing for households and firms, boosting the money supply in the process.

If you would like help on any legal aspect of re-mortgaging or on buying or selling your home, please contact Paul Cowdery on Tel: 01256 320 555.

On 20 February 2009, the Government published the final agreed design of the Homeowners Mortgage Support Scheme (the scheme).

The scheme aims to help homeowners remain in their homes for longer if they suffer a loss of income and temporarily cannot afford their mortgage repayments.

The establishment of the scheme was announced in December 2008. Since then, the Government has been working with lenders, trade associations and money advice agencies to finalise the scheme. The scheme design now sets out the key elements, including eligibility criteria, risk-sharing arrangements and duration.

The Government is now working with lenders to agree the final scheme documentation. It plans to make the scheme available to householders in April 2009, and will publish further details of the scheme when they are available.

If you would like help on any legal aspect of re-mortgaging or on buying or selling your home, please contact Paul Cowdery on Tel: 01256 320 555.

With effect from 1 April 2009, landlords and employers should check that anyone carrying out work on gas appliances or flues is registered under the new Gas Safe Register. CORGI registration will no longer carry any statutory force. There is no grace period.

In the commercial sector, failure to check that an installer is registered under the Gas Safe Scheme may mean a breach of the Building Regulations 2000 and Regulation 3 of the Gas Safety (Installation and Use) Regulations 1998.

In the residential sector, as well as a breach of the Building Regulations 2000, residential landlords (including those in the social housing sector) will breach Regulation 36 of the Gas Safety (Installation and Use) Regulations 1998 if their regular gas appliance checks are carried out by a person who is not registered on the Gas Safe Register.

This change in the regulatory regime will not only be of importance to Employers but also Landlords, Tenants as well as their agents, advisors and property managers.

If you would like advice on renting out a residential property, please contact Paul Cowdery on Tel: 01256 320 555.

If you would like advice on renting out commercial property, please contact Charles Marchant-White on Tel: 01256 320 555.