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Property Law Journal: 11 February 2013
John Starr

When is a contractor under an obligation to warn of a dangerous or defective design? John Starr examines recent case law on the issue

In ‘A word of warning for project managers’ by Lauren Thomson (PLJ299, 5 November 2012, p10), we saw how, in the case of The Trustees of Ampleforth Abbey Trust v Turner & Townsend Project Management Ltd [2012], a project manager was found to be liable to the client in damages for his failure to procure an executed building contract from the contractor. The striking thing in that case was that, from commencement to completion, the works were carried out by the contractor under letters of intent that the project manager arranged for the client to issue from time to time. The intended building contract mentioned in the letters of intent was only executed long after the works had been completed and, even then, on terms agreed at mediation that excluded any entitlement on the part of the client to liquidated damages for delay. The client claimed against the project manager damages for professional negligence. It alleged that, if the project manager had acted with the care and skill reasonably to be expected, it would have procured the contractor’s execution of the building contract before the works were completed and that, in those circumstances, the contractor would have been liable to pay liquidated damages for delay and the client would have achieved a more advantageous outcome of the dispute with the contractor. The court found the project manager liable for considerable damages.

Jason Towell discusses the government’s recent announcement that it intends to bring in permitted development rights for a change of use from offices to residential

In late January the Department for Communities and Local Government (DCLG) announced the intention to bring into force permitted development rights enabling a change of use from B1(a) offices to C3 residential without express planning permission. This follows a period of uncertainty when it was unclear whether government thinking was that this was a good or a bad idea. The government clearly now thinks it is a good idea with the new permitted development rights to be brought into force in Spring 2013. The new permitted development rights allowing the change of use without express planning permission will initially be for a limited period of three years.

Raymond Cooper highlights the potential problems with including an indemnity covenant in a lease that provides a remedy for breach of the tenants’ own covenants

A covenant by a tenant under a lease to indemnify the landlord should (if included at all) be limited to third-party liabilities incurred by the landlord as a result of the tenant’s failure to comply with specifically identified existing liabilities. It should not provide another remedy for the landlord, alternative to the landlord’s right to damages, for breach of the tenant’s own covenants.

Nabarro LLP

Rob Bruce reviews the impact of the CIL to date

The first community infrastructure levies (CIL) have been in effect for a little over a year. Therefore, it seems appropriate to review the impact of CIL over the past 12 months. Developers, landowners, planning authorities and others will be interested in progress so far:

Jon Dickins rounds up recent case law on the vexed issue of interpreting break clauses

Life is full of uncertainty and, in a competitive commercial property market, tenants want as much flexibility as possible in their leases.

Brabners LLP

Rachel Watkin assesses the practicalities of alienation provisions and AGAs in the current economic climate

Blockbusters, Jessops, JJB Sports, HMV, Peacocks… it seems like barely a few weeks go by without yet another high street retailer getting into financial difficulties. Of course, the business itself hitting a rocky patch does not mean that any particular retail unit or shop is not profitable in itself, or that the lease or premises is not desirable to a new tenant. In the current economic climate we are often seeing businesses, perhaps in financial difficulties, or those who simply wish to offload a few of their shops to rationalise their business, wishing to extract themselves from leases of premises.

A recent decision has extended a landlord’s duty to consult on proposed works. David Haines and Tanya Pinto explore the implications

It has long been established that landlords of residential premises (or mixed use premises) must ensure that they comply with the terms of the residential leases and with legislation governing service charges. Any failure to comply with lease terms and the relevant legislation will prejudice a landlord’s ability to fully recover service charge expenditure from lessees.