Works in default

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..

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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

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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

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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
• Whats the law now? What has changed?
• The Licensing Act 2003 S4(2)(c) The prevention of
  public nuisance

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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

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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

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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

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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)

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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 cant appeal.

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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

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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?

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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)

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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

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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.

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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)

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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!

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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!

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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

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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

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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!

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How to use WID

• Fifth step - preparing the demand
• One shot as you cant 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

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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 lt25k, small claims
  lt10k)
• 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

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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

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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

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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

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