AW Group Ltd v Taylor Walton (A Firm)
| Jurisdiction | England & Wales |
| Judge | Judge Hodge QC,Judge Hodge |
| Judgment Date | 29 July 2013 |
| Neutral Citation | [2013] EWHC 2610 (Ch) |
| Docket Number | Claim No. HC11C 03360 |
| Court | Chancery Division |
| Date | 29 July 2013 |
[2013] EWHC 2610 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Rolls Building
Fetter Lane
London
EC4A 1NL
His Honour Judge Hodge QC
Sitting as a Judge of the High Court
Claim No. HC11C 03360
Counsel for the Claimant: Mr Geraint Jones & Miss Laura McGinty (instructed under the Direct Public Access Scheme)
Counsel for the Defendants: Mr Neil Hext (instructed by Bond Dickinson, Bristol)
APPROVED JUDGMENT
Monday, 29 July 2013
(11.00 am)
APPROVED JUDGMENT
This judgment in the case of AW Group Limited (as claimant) v Taylor Walton (as defendants), HC11C03360, is divided into nine chapters as follows: (1) introduction, (2) the purchase of Packhorse Place, (3) the trial, (4) breach of duty, (5) causation, (6) loss and damage, (7) contributory negligence, (8) interest, and (9) disposal. But I should make it clear at the outset of this judgment that, although it is structured in this way for clarity of exposition, the contents of each separate chapter have informed the contents of the judgment as a whole.
Chapter 1: Introduction.
By claim form issued on 29 September 2011 the claimant, AW Group Limited, claims damages for professional negligence (namely, breach of contract, negligence and/or breach of fiduciary duty) by the defendant firm of solicitors, Taylor Walton, when acting as the claimant's solicitor in connection with a conveyancing transaction whereby the claimant acquired title to the property known as Packhorse Place and situated at Watling Street, Kensworth in the County of Bedford in November 2005.
The defendant firm was instructed to investigate the title to Packhorse Place, to include ensuring that all necessary planning consents were in place and/or that the title to the property was otherwise free from encumbrances. It is said that it failed to do so and/or failed to advise that planning experts be retained to deal with planning matters. It is said that, in reliance upon the defendant's advice, the claimant exchanged contracts and completed the purchase of Packhorse Place on or about 2 November 2005 and, as a result, that it has suffered loss and damage, including diminution in the value of the property.
The claimant alleges principally that Packhorse Place did not have the necessary planning consents to permit it to park HGV lorries on an area to the rear of the property. It says that had it known of this restriction, it would not have gone ahead with the purchase.
The claimant invites the court to find the following facts as proved: (1) that the defendant was aware of the claimant's intentions for the Packhorse Place site prior to completion in November 2005 and/or that the defendant failed to take adequate instructions in this regard; (2) that the defendant was, or should have been, aware that the Packhorse Place site lacked planning permission for the claimant's intended activities prior to the completion of the property on 2 November 2005; (3) that the defendant failed to advise the claimant on the planning status of the site, adequately or at all, prior to completion of the purchase of the property; and (4) that had the claimant been made aware of the planning status of the site, it would not have proceeded with the purchase.
The claimant claims the difference between what it paid for the property and what it alleges it was actually worth, together with some further losses that it alleges that it has suffered. The defendant denies breach of duty; but it also says (1) that the claimant would have gone ahead with the purchase in any event, even if it had been advised of the matters that it alleges that it was not; and (2) that if that be wrong, the claimant is entitled only to the difference in price attributable to the absence of the relevant planning permissions. In the context of this last point, the defendant contends that the claimant paid substantially more for the property than it would have been worth even had it had the relevant planning consents.
For about 12 years before the events in question in these proceedings the claimant (known, until it changed its name to AW Group Limited on 4 August 2005, as Luton Truck Stop Limited) was the owner of premises at Chaul End Lane to the east of Luton, very close to the M1 motorway. The claimant ran a truck stop from this site, providing parking spaces for about 100 heavy goods vehicles, a restaurant and bar, and overnight accommodation for the truck drivers. There were also various buildings on the site, both offices and warehouse buildings. Some of these buildings were used by the claimant and/or its associated companies, AW Transport Limited and AW Commercial Repairs Limited, whilst others were let out to third parties. AW Transport apparently carried out a haulage business, while AW Commercial Repairs had a business repairing commercial vehicles.
At some point in the late 1990s or early 2000s it became apparent to the claimant that Chaul End had the potential for development into a retail site. A number of bids were made for it over the years and, on 22 November 2002, the claimant accepted an offer from a company called Real Estate Properties Limited for Real Estate to seek planning permission for development on the site and to take an option to purchase it for £6.2 million. That option was capable of exercise on six months' notice. Planning permission was, in the event, granted in about November 2004; and, on 28 April 2005, the option was exercised and the claimant became obliged to vacate the site by 31 October 2005. In the event, the claimant managed to negotiate a licence to continue to occupy the site until 21 November 2005.
The exercise of the option created an impetus for the claimant to identify alternative real property investments. A decision was taken that the claimant would not search for a site simply to replicate all of its activities at Chaul End. The extent to which it intended to continue those activities is a matter that was explored in the evidence before me. However, it is not disputed that the claimant ended up replacing Chaul End, at least in part, with property that represented pure investment. So, in May 2005, it identified an office block in the centre of Luton, known as Dominion House, which it agreed to purchase for £3.5 million. The view of the valuer instructed on behalf the claimant's funder (National Westminster Bank, or "NatWest"), Miss Jean Howe, was that Dominion House was "a bit of a steal". Contracts for the purchase of Dominion House by the claimant were exchanged on 23 June 2005.
Packhorse Place was identified as the other site that the claimant could purchase in about July 2005. The claimant agreed to purchase this site for £2.8 million. Before any enquiries were made about the property by solicitors acting for the claimant, it put down a deposit of £140,000 that was to be returnable if the sale failed to go through "by [the seller] only". That was done on 15 July 2005.
It is an important part of the defendant's case on causation that the £140,000 deposit meant that the claimant was committed to the transaction from the start. Had it pulled out on discovering the planning issues that it alleges it was not advised about, it is said by the defendant that the claimant would have lost that money. The defendant contends that this, coupled with the absolute need for the claimant to vacate Chaul End by 21 November without penalty, and by 5 December 2005 if it was not to lose as much as half a million pounds, would have represented a compelling reason for the claimant to keep to the deal involving the purchase of Packhorse Place even if there was some element of planning risk.
Packhorse Place is an industrial estate situated behind a petrol station on the A5 to the south west of Luton and to the south east of Dunstable and about 3 miles to the north of junction 9 of the M1. Its location is shown in a map at bundle B5, page 366. On the estate there are seven separate buildings. The general lay-out of the site can be seen on the plan at B4–310. Some of these units were occupied at the time of purchase while some were vacant.
Unit 1 was an industrial building vacated by its occupier on the sale of the estate to the claimant. As part of the purchase transaction, the claimant split that unit into three, identified as units 1A, 1B and 1C, although the precise identities of these units does appear to have varied from time to time during the course of the transaction. One of those three sub-divided units within unit 1 was to be occupied by one of the claimant's existing tenants at Chaul End, VIP Services/Plasmakers Limited (unit 1A), whilst a new tenant, Creative Concepts (Europe) Limited, was to occupy unit 1B. In the event, unit 1C was let to AW Transport Limited.
Unit 2 was an office building to the south east of the site. It was occupied by a pre-existing tenant called Alpha Security Limited which had two years remaining of a five year lease. Unit 3, to the south west of unit 2, was a warehouse-type building, also let on an existing four year lease to a company called Gigasat Limited. Unit 4, in the middle of the site, was vacant and was also a warehouse-type building. In the event, it was let to AW Transport Limited upon the purchase of the site although, in fact, it was intended to be occupied by AW Commercial Repairs Limited for the purposes of its commercial vehicle repairing business.
Unit 5, on the other side of the site, was another warehouse-type building which was also vacant. It was let on purchase of the site to AW Commercial Repairs Limited although this was for occupation by a third party, TG Tyres...
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