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Works in default – the option that pays for itself? Tim Everett Chartered Fellow and Trustee, CIEH

Works in default – the option that pays for itself? Tim Everett Chartered Fellow and Trustee, CIEH. Introduction. Why I am here The objectives for the session The commitment The quid pro quo…. Outline. The two propositions The statutory law on WID Key case law Why use WID How to use WID

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Works in default – the option that pays for itself? Tim Everett Chartered Fellow and Trustee, CIEH

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  1. Works in default – the option that pays for itself?Tim EverettChartered Fellow and Trustee, CIEH

  2. Introduction • Why I am here • The objectives for the session • The commitment • The quid pro quo…..

  3. Outline • The two propositions • The statutory law on WID • Key case law • Why use WID • How to use WID • How to get your money back • Questions • Summary

  4. The two propositions • Proposition 1 • Law is like quantum mechanics… • Uncertainty rules - its all about probability • What is the law on anything – the four components • Statutes • Case law • What we think it means • What we would like it to mean

  5. The uncertainty principle!(slide not shown on day – see notes) • Statutory nuisance • PHA36 • Betts v Penge UDC 1942 • Salford v McNally 1976 • NCB v Thorne 1976 • EPA90 • What’s the law now? What has changed? • The Licensing Act 2003 S4(2)(c) The prevention of public nuisance

  6. The two propositions • Proposition 2 • Like battles, most legal actions are won and lost before a shot is fired • Getting into court as the reasonable party • Losing due to poor process is in your hands

  7. The statutory law on WID • Typical WID powers • If person required by the notice fails to execute the works within the time given the LA may themselves do so • Where notice not complied with LA may abate nuisance and do whatever necessary • The LA may themselves take the action in relation to the hazard required by an IN

  8. The statutory law on WID • Public Health Act 1936 and Building Act 1984 • PHA36 still alive, various things linked to Part XII. S107 BA virtually identical. For owners: • Expenses and interest from service of demand • Recoverable from owner for the time being • Charge on all estates and interests • Payment by instalments over 30 years • Council determines reasonable interest rate • Powers under LPA25 as if charge was a mortgage by deed, including sale, lease, receivership • For others: PHA36,61, BA84: simple contract debt

  9. The statutory law on WID • Environmental Protection Act 1990 • S81 (3) and (3A) powers to take steps/seize equipment • Original form, costs only reclaimable by simple contract debt proceedings • S81(A) reinserted PHA type powers to reclaim against owners • Charge on premises after demand operative (similar to HA powers)

  10. The statutory law on WID • Housing Act 2004 • S3 and Schedule 3 (see Part 3), enforcement of Improvement Notices • Para 6(3) brings in abortive costs • Charge on premises after demand operative • IN served on all with relevant interest, but demands on fewer parties • Power to redirect rent, action against profits • Appeals to RPT against notices and demands. Recipients of copies can’t appeal.

  11. The statutory law on WID • Town and Country Planning Act 1990 • S178 Enforcement notices, expenses are charge on the land from date works etc. completed* • S207 Replacement of trees, expenses not a charge on the land • S215 Amenities of the neighbourhood, as for S178* • *Regulations 14(2) and 14(3) of the Town and Country Planning General Regulations 1992 as amended

  12. The statutory law on WID • The Limitation Act 1980 • Section 5 simple contract 6 years from date action accrued (NB – this period can be reset if the debtor acknowledges the debt or makes a partial payment). • Section 20 money secured by a mortgage or charge 12 years from date of right to receive money accrued. No right to foreclose after that date. • But what about Section 9?

  13. The case law on WID* • West Ham Corp v Sharp 1907 • LA entitled to order for sale and appointment of receiver (private street works) • Paddington BC v Finucane 1928 • LA charge binds all estates and interests (housing) • Bristol CC v Virgin and others 1928 • LA has priority charge that binds all estates and interests (housing) • Graddage v Haringey LBC 1975 • A demand for WID expenses could be ignored as it was not signed by the right person (housing)

  14. The case law on WID • Westminster CC v Haymarket Publishing Ltd 1981 (CA) • LA charge takes precedence over mortgage and was a charge on all estates and interests in the land (rates) • Elliott v Brighton 1980 (CA) • Successful appeal against demand following automatic WID under mandatory HA notice • the council were not bound to carry out the work under s.10(1) but had a discretion to do so, which they were bound to exercise considering the individual circumstances of each case. Since they had failed to do so, they had acted ultra vires, and no demand for expenses could be made

  15. The case law on WID • Swansea CC v Glass 1992 • 6 years for claim ran from date works completed . LA cannot extend period by delaying serving the demand (housing). • Hackney LBC v Crown Estate Commissioners 1996 • Charges arising from works under London Building Acts and PDP led to vesting order for Council.

  16. The case law on WID • Sterling Homes (Midlands) Ltd v Birmingham CC 1996 • The original notice was invalid, so prosecution failed despite no appeal against the notice (noise) • R v Mansfield DC ex parte Ashfield Nominees Ltd 1998 • Challenge to notices by way of JR. Unsuccessful due to appeal rights against the notices (housing) • Kensington RBC v Khan 2002 • 12 years for seeking possession ran from date demand became operative. Again disapproved idea that LA can extend period (housing)

  17. The case law on WID • Swindon BC v Forefront Estates Ltd 2012 • Action to reclaim emergency expenses incurred by former DLO under S78 of the BA84 • Expenses recovered for preliminary inspections, highways management, security, consulting fees, scaffolding, roof removal works, road closures, as well as both LA officer and contractor fees. And VAT!

  18. Why use WID? • It may be a more effective sanction • It gets the job done – happy tenants and neighbours! • A conviction may still not lead to the works being done • It may be quicker than prosecuting • It may be easier than prosecuting • standard of proof, rules of evidence • It may be cheaper than prosecuting and you have more chance of getting your costs back! • You can always do both!

  19. How to use WID • The first step – can you do it? • Review the notice • Was it served correctly? • On the right person • By the right person • No need to appeal against a nullity • Can all the necessary works be specified? • The blocked drain example • The problems with equipment noise

  20. How to use WID • The second step - is WID a reasonable option? • What should you consider? • The likelihood the works will get done • The scale of the works • The impact on the occupiers and others • HRA98 Sch.1 Part 1 Article 8 • HRA98 Sch.1 Part 2 Article 1 • The views of those affected? • Delivery of statutory or policy objectives

  21. How to use WID • Third step - recording the decision(s) • Remember the Executive requirements • Fourth step - arranging the works • Letting the contracts select list or tender? (Contract SOs) • Making the arrangements • Supervising the works • Occupier/owner liaison • Keeping accurate time records!

  22. How to use WID • Fifth step - preparing the demand • One shot as you can’t add things later! • Making sure true hourly costs are used • Making sure you have all the evidence/records • Identifying the person(s) you have to serve demand/copy on • Notifying Local Land Charges

  23. How to use WID • Sixth step - getting the money back (no charge on premises) • Early decision on pursuing debt through civil courts if demand* not successful. • Action in court (Fast track <£25k, small claims <£10k) • If get CCJ • Bailiffs • Attachment of earnings • Third party debt order • Charging Order (interim and final orders have to be registered at Land Registry!) • Factoring the debts and write-offs

  24. How to use WID • Sixth step - getting the money back (automatic charge on premises) • Formal demand necessary including rights of appeal and effects of charge. • Serve demand on all relevant parties • Check LLC entry • set up alerts for possible signs of sale/transfer - avoiding a bfpfvwn! • Consider also pursuing through civil courts

  25. How to use WID • Getting the money back (automatic charge on premises) - continued • Additional powers • Sale and lease • Receivership • Foreclosure • If action deferred, at least annual monitoring • Time limits for action • Costs plus rolled up interest may end up being more than equity

  26. Summary • WID is a viable option in many cases • The process needs to be clear and documented and managed • There are several ways of getting your money back • The enforcement paradox

  27. Questions?

  28. Works in Works in default – the option that pays for itself?Tim EverettChartered Fellow and Trustee, CIEH

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