Back
Effective 1 June, we have a new address: 34 Imperial Square, Cheltenham, Gloucestershire GL50 1QZ
Get in Touch Menu

Health warning for occupiers

08 July 2010

A recent High Court decision has confirmed that owners or occupiers of land adjoining a development site cannot enforce the provisions of a section 106 agreement between a local authority and a developer, even if the developer’s planning obligations will affect their adjacent land.  A Willans Commercial Property Partner reports.

The Facts

  • The case (Milebush Properties Limited v Tameside Metropolitan Borough Council) concerned a section 106 agreement, entered into between Tameside Council and a developer.
  • It granted the claimant, Milebush Properties, a right of way over part of the developer’s land. The developer’s successor refused to abide by the terms (which were set out in the section 106 agreement) and instead, tried to impose new conditions over Milebush’s right of way. Milebush objected and asked the court for the right of way to be granted in accordance with the provisions of the section 106 agreement.
  • Unfortunately for Milebush, the High Court said that, although they were classed as the beneficiary of the right of way provisions, they were not a party to the 106 agreement itself and so had no right to enforce its terms.

Comments

  • This decision upholds the general principle of privity of contract in that only parties to a contract can enforce it.
  • What Milebush should have done was to insist that a directly enforceable contract be put in place with the developer at the outset, setting out the exact terms of the grant of the right of way. If that had been done, the contract with Milebush would have been binding on the developer’s successor and any breach would have afforded Milebush the opportunity to take action to enforce their rights.
  • Anyone who owns or occupies land adjoining a development site has the potential to run into similar circumstances. A directly enforceable contract binding on the developer assures land owners or occupiers that their interests have been accounted for and that they will have the option to take legal action at a later stage if the worst happens.

 

If you need clear and pragmatic legal advice, we’re here to help so please get in touch.

Contact us

Contact
Nigel Whittaker BA (Hons)
Partner
View profile
Related services
Share this article
Resources to help

Related articles

Why sole director companies should check articles of association

Corporate

A recent case has highlighted the importance of ensuring a company is incorporated with carefully drafted articles of association, if there is only one director. All limited companies must have…

Helen Howes LLM
Solicitor

Top tips for improving wellbeing in the workplace

Employment

A recent CIPD Health and Wellbeing at work survey has reported that most organisations are taking additional measures to support employee health and wellbeing, in response to COVID-19. Three quarters…

Jenny Hawrot LLB (Hons)
Partner

SCCs: New rules governing cross-border data transfers and data exchanges from the EU and EEA

GDPR & data protection

This September brings change to the use of standard contractual clauses (SCCs) governing data transfers from the EU and EEA. In June this year, the European Commission published two sets…

Kym Fletcher LLB (Hons) Euro
Consultant, solicitor
Contact us