W:
www.universitybusiness.co.uk | T: @UB_UK
FOR DISPOSAL OR DEVELOPMENT
Chancel repair: is there latent liability? Can it be insured? Party walls: are works to party walls required, including works within 3m of neighbouring structures, or 6m depending on foundation depth? Public highways/rights of way: consider the need for stopping-up or diversion. Nature conservation: are there protected plant or animal species, eg bats? Underground unknowns: are there potential contamination, flooding, ground stability or archaeological issues? Is there a risk of underground structures, apparatus or voids which mean additional cost and delay? Town or Village Green: is there a risk of registration? The underlying legislation is a powerful weapon for those seeking to delay development. Excluded mines and minerals: what is the conveyancing history? Is this a constraint to development?
and prioritise any action. [See Box]. Charity law constraints: Check that the university has the relevant powers of sale in its constitution and identify any procedural requirements to facilitate the sale, and factor their resolution into timescales. Other ownership constraints: was the land originally acquired by a local authority or government department under statutory powers – eg CPO? There may be additional procedures to follow before sale. Planning constraints: review existing planning permissions and statutory agreements; identify listed buildings/ features. Is the property in a conservation area? Are there tree preservation orders?
And more…. Rights of light: might the development infringe a third party's right to light? Can it be designed to respect the right without loss of value?
Preparing the sale data pack An essential part of the process of engaging with bidders and maximising competition is ensuring the availability of and easy access to comprehensive information about the site and constraints on development. Information should be made available in a variety of formats to suit bidders – hard copy, on disc or via a secure electronic data room. See the inset for recommended components of the pack.
The broader picture The decision to sell is only the start of the process. Decisions are also needed about the timing, terms and method of disposal, issues of governance, finance and VAT, and compliance with charity and procurement law. The more the university can reduce uncertainty and risk in relation to the site, the greater the prospect of engaging bidders and maximising value. UBUUBB
Rachel Stott, Senior Associate and Tim Smithers, Consultant Solicitor are from 0117 314 5284 or at
rstott@vwv.co.uk. Tim can be contacted on 0117 314 5311 or at
tsmithers@vwv.co.uk.
Easements and restrictive covenants: an approach to risk management
1. If the site is burdened by easements (eg rights of access, entry, parking, services or light) or restrictive covenants, development and future use may amount to an actionable interference or breach.
2. If so, the risks include: Potential for an injunction, preventing or delaying development or preventing future use.
Liability for damages for infringement or breach of covenant.
Uncertainty deterring buyers or making consequently depressing values.
3. The recommended risk assessment process is:
3.1 Establish the facts: prescriptive rights (the latter two may not be apparent from the title). Research the precise meaning of restrictive covenants.
infringement or breach (eg employ a specialist rights of light surveyor).
3.2 Assess enforceability. Has the easement been released as a matter land now in common ownership)? Perhaps a restrictive covenant burden the site.
3.3 If enforceable, assess the likelihood of an injunction or level of damages.
3.4 Is statutory help available? Eg an application to Lands Tribunal to discharge/modify restrictive covenants; does the covenant breach anti-competition legislation?
is now a housing estate with 50
3.6 Consider indemnity insurance, obtain quotes and review conditions.
3.7 Consider negotiation with the (but doing so may make the risk uninsurable).
4. Consider whether the university may achieve better value by managing a risk about which it has a degree of perception of that risk.
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