Inner House case concerning a planning appeal relating to a site on Seafield Road in Blackburn. Hallam applied for planning permission in principle for the construction of a residential development of approximately 120 houses. West Lothian Council refused planning permission for the development and an appeal to the Scottish Ministers by Hallam was also refused by the reporter appointed to determine it.  Hallam appealed to the Court of Session against the reporter’s decision.

There were two main issues at the centre of the appeal:

• whether there was a deficiency in the supply of land for new housing and whether the proposed development would help make good any such deficiency; and
• whether there was adequate school accommodation for children from the proposed development.

The reporter had found that the supply of effective housing land in West Lothian and in the area local to the appeal site was “adequate to meet current market demand for new houses” and thus the proposed development was not justified in terms of maintaining a five years’ supply of effective housing land.   The reporter also concluded that there was a lack of education capacity at Bathgate Academy and St Kentigern’s Academy to accommodate children from the proposed development meaning that the development did not comply with the relevant strategic development plan.

The Inner House found that the reporter had been entitled to conclude that insufficient capacity was available in local secondary schools to support the proposed development and, consequently, that planning permission for the development would not comply with the strategic development plan. That conclusion had been sufficient to allow the reporter to refuse Hallam’s appeal. However, the Inner House also noted that the reporter’s conclusion with regard to the supply of housing land had been erroneous and that the court would have allowed the appeal if it had not been for the lack of education provision.

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.

Background
This is an Inner House case concerning a dispute over property at Rigside in Lanarkshire. Mr McAllister had occupied the land since at least June 2006 (using it for pallet storage and lorry parking). However, Douglas & Angus Estates and Mr Carmichael argued that they were common owners of the property and that Mr McAllister was in occupation of the property without title. Whilst Mr McAllister did not claim to have title to the property himself he argued that the estate and Mr Carmichael did not own the property either (and thus had no title to sue).

The question for the court was whether a party (in this case the estate and Mr Carmichael) requires to establish a title to land where a second party, whom he is trying to remove (in this case Mr McAllister), does not have title but claims that the land may be owned by a third party (in this case, the statutory successors to Lanark County Council).

Arguments
It was accepted that, where the party being removed denies the title of the party seeking removal without arguing that he himself has title, the party seeking removal only requires to show a prima face title[1]. However, Mr McAllister contended that there is an exception to that rule where the party being removed argues that there is a competing title in favour of a third party[2]. In this case, although he did not produce a competing title, he pointed to a reference to the disputed property in his own title (of a neighbouring property) which stated that, at the time of the deed, the disputed property was thought to be owned by Lanark County Council (which, if true, would have precluded the estate and Mr Carmichael from owning the property in terms of their titles).

Decision
However, although the Inner House accepted that, if Mr McAllister had shown a competing title, the estate and Mr Carmichael would have had to establish a title to the disputed property in order to seek Mr McAllister’s removal from it, in this case, the statement in Mr McAllister’s title to the effect that the disputed property was thought to be owned by Lanark County Council was not the equivalent of a competing title. As such, the estate and Mr Carmichael only had to show a prima face title in order to pursue the action.

The court noted that what exactly may be regarded as an ex facie valid title would depend on its particular terms. And, in this case, although the descriptions in the title deeds were vague and unclear, it could not be said that the deed on which both the estate’s and Mr Carmichael’s titles relied did not include the disputed property. Consequently, the estate and Mr Carmichael (or one or other of them) had an ex facie title sufficient to allow them to pursue the action against Mr McAllister.

In those circumstances the Inner House upheld the previous decision of the Sheriff Principal granting decree in favour of the estate and Mr Carmichael and dismissing Mr McAllister’s defences as irrelevant.

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.

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[1] Ie a title that, “at first sight” or “on the face of it”, appears to be valid.

[2] Lock v Taylor 1976 SLT 238.

Background
This is an Outer House case in which Mr Aronson sought rectification of the Register. Mr Aronson had bought a property (on Dean Street in Kilmarnock) from the Bank of Scotland which was exercising a power of sale under a standard security following a repossession.

The property previously belonged to Mr Alexander who, in addition to granting the standard security in favour of the Bank of Scotland, had subsequently granted three further securities in favour of two other creditors. When Mr Alexander fell into arrears, the Bank of Scotland obtained a warrant to repossess and sell the property[1] (in May 2010) and subsequently disponed the property to Mr Aronson (in February 2011).  At the time of the repossession proceedings it was common for creditors to repossess and sell property without first following the calling up procedure and, in this case, the Bank had not served a calling up notice. However, in November 2010 the Supreme Court[2] decided that in any case where a creditor seeks repayment of a debt, failing which, the sale of the security subjects, it must first serve a calling up notice and thereafter wait two months before repossessing the property.

Mr Aaronson submitted an application to register the disposition in the Land Register in March 2011. In terms of the (Form 2) application, Mr Aronson required to indicate whether the necessary statutory procedures had been followed in relation to the Bank’s power of sale and, as a result of the Supreme Court’s decision noted above and the failure to follow the calling up procedure, Mr Aronson indicated that the necessary procedures had not been complied with.

When the Keeper registered the disposition, she excluded indemnity in respect of Mr Aronson’s title and, although the standard security in favour of the Bank of Scotland did not appear in the Charges Section of the Title Sheet, the three securities in favour of the other two creditors did[3].

In terms of the relevant legislation[4], where a creditor grants a disposition in exercise of a power of sale, the property is disburdened of that security and all other securities ranking equally with it or behind it. Mr Aronson sought to have the register rectified so as to delete the three remaining securities. The Keeper maintained that the register was not inaccurate as the property had not been disburdened of the standard securities on the basis that there had been no sale of the property in terms of the legislation as the Bank had not followed the correct procedure.

Decision
Lord Doherty rejected the Keeper’s argument and found that the register was inaccurate. There had been a sale by the bank, within the meaning of the legislation and, as such, the property had been disburdened of the securities.

As to a contention by the Keeper that, allowing the property to be disburdened of the securities where the correct procedures with regards to repossession and sale had not been followed, was to allow the Bank to benefit from its own wrong and was contrary to public interest, Lord Doherty said the following:

 “While I do not rule out entirely the possibility that the circumstances of some sales might be so contrary to public policy that Parliament might be taken to have intended to exclude them from the ambit of s. 26, I am very clear that the circumstances of the sale by the Bank to the pursuer do not fall within any such category.  In treating the loan default as a default in terms of standard condition 9(1)(b), and in proceeding down the s. 24 route, the Bank acted in good faith and in accordance with what was then understood (by the courts, conveyancers, and financial institutions and their advisers) to be a lawful route to sale.  There was no deception or bad faith.  There was no intention to depart from or undermine the proper procedures for sale…  …In such circumstances I see no scope for giving any weight to the canon of construction that a party should not be permitted to benefit from his own wrong.  I am equally clear that there is no justification for giving “sale” in s. 26(1) a strained construction in order to avoid the natural construction producing serious damage to the public interest.  On the contrary, in my view the natural and ordinary meaning relied upon by the pursuer serves the public interest.  On the other hand, deserving persons such as the pursuer would be prejudiced by the strained construction which the first defender suggests.  That strained construction is also one which runs counter to the presumption that a statutory provision should be construed so as not to produce injustice.”

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.

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[1] Under s24 of the Conveyancing and Feudal Reform (Scotland) Act 1970.

[2] Royal Bank of Scotland plc (Respondent) v Francis John Wilson and another, [2010] UKSC 50.

[3] Notes were appended to the entries excluding indemnity both in respect of any loss arising from rectification of the register to delete the standard securities or from the property being found not to have been disburdened of the above standard security.

[4] S26(1) of the 1970 Act.

Outer House case concerning an alleged contract relating to the purchase of a local authority flat at Partick Bridge Street in Glasgow in 1989.

Mr Khosprowpour claimed that he had loaned £8k to Mrs Mackay for the purchase of her flat and that the parties had entered a contract by which Mrs Mackay would remain in the property for the rest of her life without repaying the loan but that Mrs Mackay would make a will transferring it to Mr Khosprowpour on her death. Mrs Mackay also granted a standard security (securing all sums due and which may become due) in favour of Mr Khosprowpour in 1991.

Although Mr Khosprowpour said that Mrs Mackay had originally granted a will passing the property to him, she later executed a new will directing that her executors pay the sale proceeds of the flat to her children (who included Mr Khosprowpour’s former wife).

Mr Khosprowpour sought damages for breach of contract. Mrs Mackay’s executor argued that, as a contract relating to heritage[1], the contract required to be constituted by probative writing (i.e. signed and witnessed) and was consequently not enforceable. On the other hand, Mr Khosprowpour argued that the contract did not relate to heritage but instead was an innominate or unusual contract and, as such, could be proved prout de jure (by any means known to law). Even if that were not the case, Mr Khosprowpour argued that, by virtue of his payment of the funds and Mrs Mackay’s execution of the first will, Mrs Mackay was personally barred[2] from relying on the lack of formalities to resile from the agreement. Conversely, Mrs Mackay’s executor argued the fact that the Standard Security was granted in security of sums due rather than an obligation to include a provision in the will suggested that payment of the funds and execution of the first will were not unequivocally referable to an obligation requiring her to leave the title to the flat to Mr Khosprowpour in her will.

After considering the authorities[3], Lord Turnbull found that the contract related to heritage and, as such, required formal writing for its constitution. However, it was found that Mr Khosprowpour had set out a stateable case regarding personal bar and a proof was allowed to consider whether it could be established.

The full judgement is available from Scottish Courts here.

(NB: see appeal to Inner House here.)

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

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[1] As the alleged contract took place in 1989, the Requirements of Writing (Scotland) Act 1995 did not apply and the situation was governed by the pre-1995 Act common law rules on the requirements of writing.

[2] By virtue of the common law rule of rei interventus (where there are important actings by the party seeking to rely on the agreement which are known to and permitted by the other party and which are unequivocally referable to the purported contract.)

[3] In particular McEleveen v McQuillan’s Executrix 1997 SLT (Sh Ct) 46.

Background
Outer House case in which Northern Rock sought damages from the solicitor of one of its customers. Headway Caledonian Ltd borrowed sums from Northern Rock to finance the purchase of a Business Park in Hamilton. In return it granted a standard security in favour of Northern Rock. Some years later, Headway’s solicitor sent a draft discharge of the standard security to Northern Rock requesting that it sign and return the document. In the accompanying email, the solicitor stated that the company intended to sell the subjects and redeem the loan. However, that information was incorrect as Headway only intended to sell part of the subjects and to redeem part of the loan. (The reason for the error was unknown.)

Northern Rock (which had not instructed solicitors to act on its behalf in the transaction) relied on the email and granted the discharge of the standard security. The solicitor then registered it in the Land Register. As a result the loan became unsecured. Headway then became insolvent and the Northern Rock raised an action for damages against the solicitor and her firm in respect of its losses.

The solicitor argued that the lender was a third party to whom she did not owe a duty of care.

Lord Doherty agreed with that argument.

Decision
Whilst a solicitor on one side of a conveyancing transaction will not normally owe a duty to the party on the other side, the law will imply a duty in exceptional circumstances.

The crucial considerations this case were (i) whether it was reasonable in the circumstances for Northern Rock to rely upon the misstatements without checking them by seeking clarification from the solicitor and/or looking at their file; and (ii) whether it ought to have been foreseeable by the solicitor that Northern Rock might reasonably rely upon the misstatements without checking them, and thereby suffer loss.

In favour of the view that there was the requisite foreseeability and reasonable reliance were that the email (i) contained no disclaimer; (ii) had a degree of urgency in its tone; (iii) was communicated directly to Northern Rock, rather than to professional advisers; and (iv) that it came from a solicitor (a trustworthy source).

On the other hand, being a commercial bank, Northern Rock were in no sense vulnerable or dependent. They had the ability to obtain legal advice if they required it. Ultimately though, the critical information had been factual and concerned matters that could have been checked very easily and very quickly by Northern Rock.

Lord Doherty also took into account the fact that the erroneous information in the email conflicted with what had previously been agreed between Headway Caledonian and Northern Rock and that in some respects the email had been vague and ambiguous and, as such, “cried out for further clarification”.

The full judgement is available from Scottish Courts here.

(NB: see appeal to the Inner House here. See also the decision of Lord Woolman allowing the Proof here.)

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

I thought I should wait a few days before commenting on the ‘Report of the Smith Commission for further devolution of powers’.  I am glad I did given what was contained in the UK Government’s Autumn Statement.

I will though start with the Smith Commission.  How do I sum up it up in a few words?  Probably easier to start by saying what it is not.  It is not ‘devo max’, nor ‘devo plus’ nor ‘home rule’. So what is it?  I often refer to the Scotland Act 2012 as ‘Calman minus’. The Smith Commission does though go further than what was recommended by the Calman Commission but not nearly as far as what I have already said it is not.  I will come back to this point near the end of this article.

This article primarily looks at the fiscal side of Smith and in particular the tax aspects.  The welfare provisions are though interesting, again Smith could easily have gone a lot further, but it does mean that the Scottish Parliament is likely to, not certain to, have enhanced welfare powers albeit from a very low starting point.  I suspect we will soon start to hear the first rumblings concerning the creation of the welfare equivalent of Revenue Scotland.

Now to Smith.

In short, after two commissions and three Scotland Acts the Scottish Parliament will still not have complete control of one the five major taxes, may have control of six minor taxes (out of over 20 minor taxes, charges, revenues and duties) and control of the Crown Estate. If nothing else, this makes you wonder how many Commissions and Scotland Acts it will take before the Scottish Parliament will have control of one of the five major taxes.

One of the main recommendations made by Smith concerns income tax.  This is from Smith:

“Income Tax will remain a shared tax and both the UK and Scottish Parliaments will share control of Income Tax. MPs representing constituencies across the whole of the UK will continue to decide the UK’s Budget, including Income Tax. Within this framework, the Scottish Parliament will have the power to set the rates of Income Tax and the thresholds at which these are paid for the non-savings and non-dividend income of Scottish taxpayers (as defined by the Scotland Acts). As part of this, there will be no restrictions on the thresholds or rates the Scottish Parliament can set.”

I suspect we will hear a lot more about “English votes for English laws” when the next Scotland Bill is introduced and in particular when income tax is debated. This recommendation is more an example of ‘power retained’ than ‘power devolved’ given all that has been retained by Westminster.  See below:

“All other aspects of Income Tax will remain reserved to the UK Parliament, including the imposition of the annual charge to Income Tax, the personal allowance, the taxation of savings and dividend income, the ability to introduce and amend tax reliefs and the definition of income.”  

Calman did of course recommended that 50% of income tax on savings and distributions was to have been assigned to the Scottish Parliament. Why 50%. No explanation was given.

“In line with the approach taken for the Scottish rate of Income Tax, the Scottish Government will reimburse the UK Government for additional costs arising as a result of the implementation and administration of the Income Tax powers described above.”

The costs associated with the Scottish Rate of Income Tax have been estimated at approximately £50m.  See following report.

So taking Smith at its highest which tax powers will the Scottish Parliament have:

• Income partial control only – Scotland Act 1998, Calman, Scotland Act 2012 and Smith
• Council tax – Scotland Act 1998
• Business rates – Scotland Act 1998
• Land and Buildings Transaction Tax (from 1 April 2015) – Calman and Scotland Act 2012
• Scottish Landfill Tax (from 1 April 2015) – Calman and Scotland Act 2012
• Air Passenger Duty – Calman and Smith
• Aggregates Levy – Calman and Smith
• Crown Estate – Smith
• VAT assignation of the first 10 percentage points of the standard rate – Smith

As noted above, Calman also recommended that control of air passenger duty and aggregates levy should be devolved over four years ago.

As with income tax and indeed all newly devolved taxes, the Scottish Government has to reimburse the UK Government for any costs incurred in ‘switching off’ APD and “aggregates levy” in Scotland.

The VAT recommendation has been pretty much ignored and begs the question why not simply assign all VAT revenue? This makes as much sense as when Calman recommended devolving 50% of income tax on savings and distributions.

The Crown Estate is in some ways the most important fiscal recommendation and is long overdue.

So what have ‘they’ said ‘no’ to again?

The ‘big 5’

• Income tax still primarily a UK tax
• VAT
• National insurance contributions
• Corporation tax
• North Sea revenue

Other minor taxes, charges, revenues and duties

• Fuel duties (various)
• Capital gains tax
• Inheritance tax
• Stamp duty on shares and Stamp Duty Reserve Tax
• Tobacco duties (various)
• Alcohol duties (various)
• Betting and gaming duties (various)   
• Insurance premium tax
• Climate change levy
• Vehicle excise duty  
• Bank levy
• Licence fee receipts
• National lottery

As to headline figures, this means that the Scottish Parliament will only have control (not complete control) of approximately 30% of tax revenues and 25% of welfare spending.  That said, it is not just the number of taxes and how much revenue they raise but also how they interact with other taxes and matters already under the control of the Scottish Parliament.

For example, Westminster could have already and relatively easily devolved substantial tax powers to the Scottish Parliament but has failed to do so.  A number of taxes are closely associated with the responsibilities already devolved to the Scottish Parliament which would have given the Scottish Parliament a substantial number of economic levers and the chance to develop policy more effectively.

Below are some examples:

• Property law is devolved but SDLT (not until 2015) and capital gains tax are not.
• Succession law is devolved but inheritance tax is not.
• Environmental law is devolved but not all the environmental taxes are.
• Health is devolved but alcohol and tobacco duties are not.
• Transport is devolved but transport related taxes are not.

My own submission to Smith can be found here.  Given the timescales involved, and the political realities surrounding which powers could be included, I suspect that almost every submission was ignored.

Looking ahead.  Nothing is of course certain.  Calman proposed six new tax powers and only three made it into the Scotland Act 2012.  Will the Smith Commission proposals suffer the same fate?

This is something I wrote a couple of years ago.

“A template can be seen from Calman, what might be called the “Calman doctrine”.  Make a huge fuss about having someone look at the issue, take your time, offer as little as possible, exaggerate any problems, minimise or ignore any advantages and ensure HMRC and HM Treasury remain in control.”

The opposition to these modest proposals has already begun.  UKIP want it stopped entirely.  Many in the Labour party are unhappy with the income tax proposal.

Smith also offers no resolution on why the Scottish Police and Fire and Rescue services have to account for VAT. It may though have inadvertently solved another thorny issue and which concerns the UK Treasury’s refusal to transfer attendance allowance funding to the Scottish Parliament since the Scottish Parliament introduced Free Personal and Nursing Care. Control of Attendance Allowance is one of the welfare powers that might be devolved to the Scottish Parliament.

Then there is the UK Government’s Autumn Statement.

George Osborne copied a great deal of the Scottish Government’s proposed Land and Buildings Transaction Tax in his reform of Stamp Duty Land Tax. This was surprising given that the Conservatives had previously attacked the approach taken by the Scottish Government. The main reason for Osborne’s change of direction is I suspect the forthcoming UK General Election and in particular Labour’s ‘mansion tax’ proposal for England and Wales.

Osborne is also proposing that corporation tax, at least in part, is devolved to Northern Ireland, control of business rates is devolved to Wales and a ‘Sovereign Wealth Fund’ is created for the ‘North of England’.  The irony of many of these points will not be lost on those who followed closely what was being said in the independence referendum.

Some things are though certain.  The ‘vow’ such as it was not delivered.  The argument being put forward, and in particular by the Conservative party, is that if you believe in the pooling of resources throughout the UK then this is the ‘maximum’ amount of devolution that is possible within the UK.  Not surprisingly this ‘explanation’ was not put forward when Gordon Brown suddenly entered the referendum debate.

Is this the end of the devolution process?

The main ‘NO’ parties felt a line had been drawn after the Scotland Act 1998 and the reconvening of the Scottish Parliament.  The general feeling was that whilst tinkering with the devolved powers was acceptable nothing of any real substance would change.

That changed in 2007 with the election of the SNP government.  That in turn resulted in the Calman Commission. That again was meant to be a line in the sand. The UK Government felt confident enough to not even bother to include all of the powers recommended for devolving by Calman in the Scotland Act 2012.  The election of a majority SNP government and the independence referendum resulted in the ‘vow’ and the Smith Commission.

What does this tell us?  Quite simply if Westminster feels the need to create a new line in the sand it will.

Background
Inner House case relating to a development at Rubislaw Quarry in Aberdeen. The developers sought the co-operation of those with interests (proprietors/tenants) in nearby office blocks (who were concerned that the new development would have a detrimental effect on the value of their properties) with respect to access to the development site. An agreement was entered into between the developers and the proprietors/tenants which included a restriction on the net lettable office space within the new development. The court action involved successors to the original parties to the agreement.

Arguments
The developers sought declarator that the relevant clause:

1. allowed the total amount of office space in the development to exceed the restriction (i.e. they argued that the restriction did not apply to owner occupied or vacant office space); and
2. was not a real burden and, as such, bound only the original parties to the agreement and not their successors.

Decision
Those arguments were rejected both in the Outer House and again on appeal to the Inner House.

Meaning of the clause
Taking account of the commercial purpose of the clause and the overall commercial context in which that agreement operated, the court found that the intention was to provide for a maximum floor area which was capable of being let for office use.

Whether binding on successors
Whether the burden was real (i.e. binding on successors) depended on whether the restriction on office space was:

1. purely a trading condition, designed solely to protect the personal commercial interests of those  interested in the offices; or
2. whether it, in addition to any personal benefit, also conveyed a material benefit on the properties themselves.

The proximity of the development to the offices was an important consideration (without physical proximity there can be no real burden). Not only were the properties adjacent to one another, it was intended that they should share the same access road.  The proprietors/tenants were seeking protection against reductions in rental values arising from the introduction of additional competition within the neighbourhood. The restriction therefore benefited the offices as commercial properties by protecting their rental value. The court also found that the clause did not result in an unreasonable restraint of trade noting that it had been negotiated as part of commercial agreement between the parties (there being no suggestion that there was any disparity in the parties’ bargaining power) which indicated that it was reasonable as between the parties. The clause merely restricted the amount of office space that could be constructed and did not prohibit use of the property as office space. Further, the court noted that there was no suggestion that the extent of the actual restriction imposed was in any way unreasonable or disproportionate in the context of the whole of the Rubislaw developments.

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.

Background
Sheriff Court case concerning common property owned by a husband and wife.

The parties had entered a minute of agreement which provided that:

1. part of the subjects be sold and the proceeds divided between the parties subject to  a deduction of £4k from Mr Fraser’s share which would be paid to Mrs Fraser; and
2. Mr and Mrs Fraser would seek to obtain planning permission for development of the remainder of the property before selling it with the proceeds being divided equally.

Mrs Fraser sought declarator that she was entitled to insist on an action of sale of the first part of property and payment of £4K to her from Mr Fraser (per the minute of agreement[1]) and that she was also entitled to insist on an action of division of the remainder of the property (contrary to the minute of agreement).

Arguments
Mrs Fraser argued that the right to division (or division and sale) of the property could be taken as of right[2]. Thus, with respect to the payment of £4k, she was not arguing for enforcement of the minute of agreement but rather, (as Mr Fraser indicated) appears to have been arguing that payment was an aspect of the division and sale.

Mr Fraser argued that, where the parties have contracted as to how a property is to be divided or sold, it is not open to them to insist on an action of division and sale.

Decision
After considering the authorities[3], the sheriff dismissed Mrs Fraser’s action:

“Far from excluding the right to have the bonds of common ownership broken the minute of agreement provides the method by which that will be achieved.  But, by contracting in this way the parties have ousted the jurisdiction of the court to order division or sale and division.  Whilst the contract remains in force neither party is entitled to resort to the court.”

 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.

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[1] However, note comments in the next paragraph.

[2] When dealing with common property, parties have an absolute right to insist on an action for division and sale: see, for example, Gordon Collins v. Carol Anne Sweeney, 13 March 2014

[3] Grant v The Governors of George Heriot’s Trust and Others 1906 13 S.L.T. 986, Morrison v Kirk 1911 (2) S.L.T. 355 and Upper Crathes Fishings Limited v Bailey’s Executors 1991 S.L.T. 747.

Sheriff Court case in which Mr McWatters sought the revocation or suspension of a Demolition Order over his flat on Bruce Street in Port Glasgow.

Background
When Mr McWatters bought the flat, in September 2011, it was already subject to a Closing Order. Then, in August 2012, the Council made a Demolition Order in respect of the whole building of which Mr McWatters’ flat formed part (as part of wider regeneration plans for the area).

Closing Orders, which prohibit the use of a house for human habitation, can be made by a local authority[1] where the authority is satisfied that any house (forming part of a larger building) does not meet a tolerable standard[2] and that it ought to be demolished. The owner of the house is then able to offer an undertaking[3] to the local authority that it will bring the house up to a tolerable standard. The local authority can then (if it accepts the undertaking) issue a suspension order suspending the Closing Order or, alternatively, it can issue a Demolition Order. After a Demolition Order has been granted, it can only be revoked if the whole building is brought up to standard.

In this case Mr McWatters argued that he had given undertakings to the Council to bring the whole building up to a tolerable standard and that they had unreasonably refused the undertakings.

Decision
However, the sheriff found that Mr McWatters’ plans for bringing the property up to standard were lacking in detail and costings, and despite the fact that the Demolition Order could only be revoked if the whole building were to be brought up to tolerable standard, he had failed to prove that he had the authority of the other owners in the building authorising him to proceed with a renovation at an open-ended cost on their behalf. As such, Mr McWatters had failed to show that he is was a position financially or practically to complete a renovation of the whole building and his plans were found not only to be wholly lacking in specification and detail but also wholly lacking in credibility.

The sheriff also found that McWatters failed to provide a good reason for interfering with the Council’s decision to demolish the property in support of their regeneration plan, noting in particular that Mr McWatters had failed to take steps to bring his own flat up to standard between purchasing it in September 2011 and the granting of the Demolition Order in August 2012 and that he had also failed to bring the whole building up to standard during the period after the granting of the Demolition Order when he claimed to have the authority of the other owners to do so.

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.

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[1] Under s114 of The Housing (Scotland) Act 1987.

[2] For the local authority to proceed by way of a Closing Order there must also be other houses in the building which do meet the tolerable standard.

[3] Under s117 of the 1987 Act.

Outer House case in which Mrs Shepherd sought damages from Travelodge following an injury sustained after slipping and falling following a diesel spill in Travelodge’s car park (situated near Dreghorn Services in Edinburgh).

Mr and Mrs Shepherd were motorcyclists and met other members of the Dunedin Chapter of the Harley Davidson Motor Cycle Club in the Travelodge car park (between 8.30 and 8.45) prior to riding to Staffordshire for an event. Before the bikers arrived there had been a diesel spill in the car park.

A manageress at Travelodge was informed of the spill sometime between 8.15 and 8.30. She logged a job with Travelodge’s maintenance company (in order to have the spill cleaned up) then phoned Travelodge’s health and safety manager and her divisional manager. On the advice of the health and safety manager, the manageress cordoned off the car park and put notices up saying that the car park was closed and advising that there had been spillage.

The bikers left the car park about 9am then stopped at Glencorse Barracks where Mrs Shepherd slipped and fell. The Court found, on the balance of probabilities, that the accident had been caused by diesel picked up by Mrs Shepherd on her boots at the Travelodge car park.

Mrs Shepherd argued that Travelodge were liable for the accident as they:

1. had breached their duty of care due in terms of s2 of the Occupiers Liability (Scotland) Act 1960;
2. had breached their common law duty of care; and
3. were vicariously liable for a breach of duty by the manageress.

Lord Boyd found that the accident had been foreseeable and the fact that it had happened some distance away from the original spill did not matter. In coming to this conclusion he noted that it was important that Mrs Shepherd had slipped as a result of diesel on the sole of her own boots and that it may have been different (i.e. not foreseeable) if she had slipped on diesel transferred to Glencorse on the soles of the boots of the other bikers.

 Lord Boyd also found that there was a duty of care both at common law and under the 1960 Act, noting that Travelodge were occupiers of the car park to which the public had access. That duty conferred an obligation on Travelodge to have a sign posted[1] at the entrance to the car park either closing the car park or at the very least warning people entering the car park of the danger.  The obligation would also extend to advising people who already had cars in the car park of the danger of slipping on the diesel. Travelodge had put up signs in this case, fulfilling the obligation and meeting the duty of care.

As to the actions of the manageress, Lord Boyd found that arguments to the effect that she should have acted more quickly were potentially problematic. From the evidence, the time frame between the Manageress finding out about the spillage and Mr and Mrs Shepherd arriving at the car park may be as little as a few minutes or, at the longest, half an hour. It was suggested that she may have sought the advice from the health and safety manager and carried out her instructions before contacting the maintenance company but Lord Boyd was not satisfied[2], on the balance of probabilities, that even if she had done so, the car park would have been closed before Mr and Mrs Shepherd arrived.

 As a result, Lord Boyd found in favour of Travelodge.

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.

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[1] Although the diesel was visible in the wet by means of the distinctive rainbow effect in the water, Lord Boyd did not consider that it would be so obvious to a motorist, motor cyclist or pedestrian that there was no need to put up any sign. As such, the circumstances of this case were very different to those in Leonard v Loch Lomond & Trossachs National Park Authority.

[2] It was noted that the suggestion was made with the benefit of hindsight and it was difficult to say that the manageress was in breach of her duty of care by arranging for the spill to be cleaned up as a priority.