Commercial Property

Do you think that when the company was created anyone thought of the similarity in the name to a certain John Le Carre character. At least this company and the DCLG are fighting out there differences in the full glare of the courts and not in the labyrinthine realm of the Circus.

Pickles is, as they say, dead but will not lie down. He has announced that the Government will introduce legislation to push on with the abolition of the Regional Strategies. He has also announced that taking that into consideration the planners and the Inspectorate should bear his comments in mind.  See his letter of the 10th November to Chief Planning Officers.

I was recently at an interesting discussion on the potential use of mediation on town and country planning matters. The initial reaction, of the majority of the town and country planners, both in the private sector and the public sector, was that the idea was interesting but that they could not see how that process would easily fit into the system.

That issue is not the main point of this blog which is Cala. What Pickles hopes is that the professionals will ignore Cala and forget regional Strategies. From what I gathered that is unlikely to happen. Several of those present had appeals going on where the submissions had been drafted excluding reference to the Strategies and where that there is now a frantic rewrite. Whilst I can understand what Pickles is driving at it is strange, to a lawyer, to suggest that people should forget what the law says because the law should change.  What happens if the law does not change or the government changes its mind on its planning reforms? That would be good as  for the majority of what they propose but I doubt will happen.  Apart from that, I think a lot of people will want to revert to the regional Strategies because, for all their faults, a lot of the planning fraternity think they are better than what is proposed.

I went on holiday in September with the promise from various clients that their land deals were progressing and came back two weeks later bronzed by the Marrakesh sun, refreshed and having honed my negotiating skills by haggling over taxi prices and the like to find what?
Not a lot. The clients are all nervous and certainly sitting on their hands. The banks are out trying to lend, as long as there is absolutely no risk and they have security that is not only belt and braces but also the trousers as well.

So what does a commercial property lawyer do? He turns to his second string of planning advice. There is still work in this area particularly relating to certificates of lawful use and enforcement issues. Certificates of lawful use seem to be an area which is now much considered. Why one asks oneself?  I suspect it is because the planning process is in such a muddle, with thanks to Mr Pickles, that people are turning to the idea of getting some basic position secure so that they can then try and move to their real objective knowing that the local planning authority cannot take away the base position. A certificate of lawful use is relatively easy to obtain, provided that the applicant completes all the necessary boxes and forms. The case is one of fact and not subject to the vagaries of the views of planning officers and the planning committee. Has the use been continuous for 4 or 10 years?  If so, the certificate must be granted.

I know there have been some high profile cases involving secret development which have fallen foul of the procedure but these are rare and, from what I read, deserved to fail .

Sometime ago I was involved in a refinancing package between two companies which were in common ownership.   Company A lent company B money and as part of a cost saving exercise,  the loan, although recorded in both companies records, was never protected by a formal charge registered at the Land Registry and at Companies House.

Latterly company A has given a guarantee to Barclays Bank in respect of a loan by that bank to company C.   That guarantee is protected by a debenture and charge over company A’s assets. For a variety of reasons, not least the attitude of Barclays,  company B wants to protect its position by having a charge over the assets of company A.

I have had to advise that the only way company B’s position can be protected against Barclays bank is for that bank to agree to postpone its protection. The client is going into negotiations with Barclays, I anticipate more in hope than in expectation.

At the time of the original loan there was good reason to spend as little money as possible and the companies remain in the same ownership, so that the common management knows exactly the financial position.  However,  the story does demonstrate that cost savings can lead to a future adverse position unless those involved remember what happened in the past.