“Build Build
Build” is the latest three-word mantra from the Johnson regime being drilled into
the heads of a population emerging from lockdown.
New PDR
In support
of this policy the government has announced new rules allowing blocks of flats
to be extended upwards by two storeys to create new homes without the need for
planning permission, to come into force on 1 August 2020.
This is
being done by a change to the Permitted Development Rights (PDR) being
introduced by the Town and Country
Planning (Permitted Development and Miscellaneous Amendments) (England) (Coronavirus)
Regulations 2020. However, the change has nothing to do with coronavirus and
is not temporary.
Current PDR
are contained in the Permitted
Development Rights (England) Order 2015 and enable certain changes of use
without the requirement to obtain full planning permission. For example, one of
the established PDR allows the conversion of offices to residential.
The 2015 Order
is being changed to allow an additional two floors of new flats to be
constructed on existing purpose-built detached blocks of flats under a new
Class A of Part 20.
The new PDR
includes carrying out the necessary engineering operations to support the new
floors; the right to replace or add roof-based plant and equipment; the
construction of safe access; and the construction of storage, waste and other
ancillary facilities.
Restrictions
However, the
following restrictions apply:
·
The
building must have no less than three above ground floors;
·
it
must have been constructed after 1 July 1948 but before 5 March 2018;
·
there
are restrictions on the height of each new floor, and on the relative and
maximum heights of the building, so that the extended building must not exceed
30 metres in height; and
·
the
rights are not available if the building is in a conservation area, National Park
or site of special scientific interest, if the building is listed, or if it is
within 3km of an aerodrome. There are some other hazard-related restrictions.
The
reference to 1 July 1948 might appear arbitrary but it’s been chosen because it
reflects the date when the Town and Country Planning Act 1947 – the first planning
legislation - came into force granting planning title to all pre-existing
buildings and uses. The other date – 5 March 2018 – reflects the date when it
was announced that the government would consult on the right to build upwards.
Prior
Approval
The PDR is
not automatic.
Before exercising
the PDR, a developer must apply to the local planning authority for prior
approval.
The prior
approval process is not meant to replicate the hurdles a developer would have
had to overcome to obtain full planning permission. Instead, the planning
authority has a more limited number of planning considerations to take into
account. Nevertheless, these could still prove difficult to satisfy. They
include the building’s external appearance; impact on the amenity of the
building and neighbouring properties; overlooking; privacy; and loss of light.
If prior
approval is not given, a developer has a right of appeal.
CIL
If a
Community Infrastructure Levy charging scheme is in place, then CIL will apply
to these conversions. However, a local authority cannot impose further charges
under section 106 agreements.
Rights of
Light
The new PDR
will be welcomed by developers but carrying out conversions of this nature is
never going to be straightforward. There are other legal issues that must be
considered before floors can be added to buildings.
Any rights
of light that may have been acquired by neighbouring buildings must be reviewed
carefully, and in build-up areas a rights of light survey is advisable.
In a recent
case (Beaumont
Business Centres Ltd v Florala Properties Ltd [2020] EWHC 550 (Ch))
the high court granted an injunction ordering a developer to take down part of
a completed development that was deemed to infringe the rights of light of a
neighbouring building.
Restrictive
Covenants
The title to
the building should be examined to see whether there are any restrictive covenants
that prohibit increasing the height of the building.
Existing
Leases at the Building
This is
another area where things can get very complicated and where third parties
could potentially frustrate the development.
If the
remainder of the building is let, the precise areas demised by any current
leases of the upper floors must be examined before undertaking any development
and before granting any development leases.
In a recent
case (R. (on the application of HCP (Hendon) Ltd) v Chief Land Registrar [2020] EWHC 1278 (Admin)) the High
Court ruled that existing leases of the flats on the upper floors included the
roof and roof space of the building. The building owner had granted to a
developer a development lease of airspace for the construction of an additional
floor, which included the roof and roof space. As the roof and roof space were
already demised to the upper flats, the development lease was deemed to be
concurrent with those leases of the flats, meaning it was subject to those
leases. As a result, the developer was unable to take possession of the roof
and roof space and comply with its obligation in the development lease to
construct an additional floor.
In this
case, the developer had relied on the short description of the existing flats noted
on the register – “as to the parts tinted blue on the title plan only the
first floor maisonette is included in the title”. Had the developer ordered
copies of the leases themselves, it would have discovered that the more
detailed description of the demise given in the leases of the upper flats (which
is what actually determines the extent of the demise, rather than the brief
description given on the registered title) showed that the roof and roof space
had already been demised under the existing leases.
Airspace
Presumptions
Leases
themselves are not always clear on what is included in the demise, or they may
be silent as to the airspace. In many cases the leases will be “internal only”
and will exclude the structure and roof of the building, in which case the
building owner is free to carry out development in the absence of any other
restrictions in the leases (there may well be some however and so the whole of
the leases must be read carefully).
What are the
legal presumptions where there is a lease of the whole building or leases of parts
of the building that include the structure but are silent on the airspace?
If the lease is of the whole building, the general rule is that the
demise includes the airspace above it, unless the lease expressly excludes it.
That is also normally the case if the lease is of the upper portion of
the whole building including the roof (again unless the lease expressly
excludes the airspace).
However, there are no clear presumptions relating to divisions of
individual parts of a building, and if a building is divided up vertically, for
example in a mansion block where the roof is over several flats next to each
other and is not demised to one tenant, the individual demises are unlikely to
be deemed to include the airspace in the absence of any express wording.
So, there’s a distinction between a top floor flat where the demise
includes the whole of the roof against a demise that includes only part of the
roof.
In Ralph Kline Limited v Metropolitan and
County Holdings Limited [2018] EWCH 64 (Ch) the High Court held
that on a proper construction of a lease of a whole building, the demised
premises included airspace to the extent that is required for the ordinary use
and enjoyment of the premises. The facts are too complex to recite here, but
the case report provides a useful analysis of the case law to date.
Rights
Reserved in Existing Leases
As a
landlord, the building owner must always comply with its covenant for quiet
enjoyment in any existing leases and adhere to the principle of non-derogation
from grant.
A covenant
for quiet enjoyment overlaps with a landlord's implied obligation not to
derogate from its grant. The principle is based on the rule of common honesty:
a person cannot give with one hand and take away with the other. In the context
of leases, it is usually relied on to stop a landlord from doing something that
would prevent the tenant from enjoying the property leased to it.
The building
owner must also ensure it has adequate rights reserved under all the existing
leases in the building to be able to carry out the works.
In Timothy Taylor Ltd v Mayfair House Corporation & Anr
[2016] EWHC 1075 (Ch) the
High Court ruled that the reservation of a landlord's right to build should be
construed as entitling the landlord to carry out the works in question,
provided that the landlord takes “all reasonable steps” to minimise disturbance
to the tenant.
When seeking
to carry out works, even when exercising an express right to do so under
existing leases, to try and minimise disruption and the risk of any disputes a
building owner should aim to:
·
liaise
with tenants when the works are being planned, in order to discuss the nature
and extent of the works and to develop an appropriate strategy for minimising
the impact of those works on the tenants;
·
design
and procure the works so as not to impact on the tenant’s use of the property
negatively, where practicable;
·
where
the works may cause more than minor disruption to tenants, consider offering a
reduced rent for the duration of the works (or some other form of
compensation);
·
ensure
that the project manager/contractor/site team responsible for supervising the
works comply with any agreement reached with tenants aimed at minimising
disruption; and
·
provide
tenants with regular updates about the progress of the works and give them an
opportunity to discuss any practical problems arising from the works.
There may be
plant and equipment located on the roof that benefits the existing tenants,
such as air conditioning, satellite dishes and aerials. This will need to be
relocated whilst the development is carried out and possibly re-sited on the
new roof on completion.
Telecoms
Equipment
If there is
telecommunications equipment on the roof of the building let to telecoms
companies, the building owner will need to negotiate with the telecoms companies
for the temporary removal and relocation of the equipment and the eventual re-siting
of the equipment on the new roof after the development has been completed. The
telecoms companies will have rights under the Electronic Communications Code
which must be considered.
What next?
In view of
the hurdles to be overcome in the prior approval process and the many other
factors to be considered, including those I’ve outlined above, I wonder what
the uptake of this new PDR will be and how many homes will ultimately be
generated by it.
The existing
PDR allowing the conversion of offices to residential is also being amended.
There has
been controversy over the way the existing PDR has been used and the quality of
accommodation that has in some instances been created (including even in some
cases windowless flats). The government has amended the PDR so that now the
prior approval by the planning authority must also include consideration of the
adequacy of natural light in all habitable rooms in the new homes.
It’s not
clear how a planning officer will determine what may or may not amount to
adequate natural light. Will expert (and costly) light assessments be required?
It is likely
too that further PDR easing will be introduced to encourage the conversion of
more offices and also retail space to residential.
In other
planning news, as a temporary measure in response to Covid-19, the government
announced on 22 June that all planning permissions which were due to expire
between 23 March and 31 December 2020 would be extended until 1 April 2021.
Generally,
the Prime Minister wants to unleash what he calls the most radical reform of
the planning system since the Second World War. There wasn’t any planning law
then, so this could be… interesting…
UPDATE 23/9/20 - A legal challenge by way of judicial review has been
made to the changes to the GDPO and the changes to
the Use Classes Order. The High Court
(Holgate J), has directed that this action will be heard in a
“rolled-up” hearing in the
first half of October. There is a possibility this could go all the way
to the Supreme Court. Changes of use carried out in the meantime
pursuant to the new Use Classes Order will remain valid as if the
relevant statutory instruments are quashed it will not have
retrospective effect.
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