Sophie Louise Hicks v 89 Holland Park (Management) Ltd

JurisdictionEngland & Wales
JudgePelling
Judgment Date29 April 2021
Neutral Citation[2021] EWHC 930 (Comm)
Date29 April 2021
Docket NumberCase No: LM-2021-000011
CourtQueen's Bench Division (Commercial Court)

[2021] EWHC 930 (Comm)

IN THE HIGH COURT OF JUSTICE

BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES

LONDON CIRCUIT COMMERCIAL COURT

Royal Courts of Justice, Rolls Building,

Fetter Lane, London, EC4A 1NL

Before:

HIS HONOUR JUDGE Pelling QC

SITTING AS A JUDGE OF THE HIGH COURT

Case No: LM-2021-000011

Between:
Sophie Louise Hicks
Claimant
and
89 Holland Park (Management) Limited
Defendant

Mr Philip Rainey QC and Mr Mark Sefton QC (instructed by Mishcon de Reya) for the Claimant

Mr John McGhee QC and Mr James Hanham (instructed by Gowling WLG (UK) LLP) for the Defendant

Hearing dates: 23 – 24 March 2021

Approved Judgment

I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.

HIS HONOUR JUDGE Pelling QC, SITTING AS A JUDGE OF THE HIGH COURT

HH Judge Pelling QC:

Introduction

1

The defendant is the owner of the freehold of 89 Holland Park, London W11 (“89HP”), the footprint plan of which is shown hatched in black at the top of the plan (“Plan”) at Paragraph 2 of my earlier judgment in these proceedings handed down on 4 June 2019 (“2019 Judgment”). The claimant is the freehold owner of the irregular quadrilaterally shaped site shown on the Plan located immediately to the south of 89HP (“Site”). The Plan is reproduced below for convenience.

2

In these proceedings, the claimant, as covenantor under covenants contained in clauses 2(b) and 3 of a Deed made between the predecessors in title of the claimant and defendant dated 10 July 1968 (“the 1968 Deed”), the full text of which is set out in both my earlier judgment and below, seeks declarations to the effect that the defendant as covenantee has unreasonably refused its approval of her plans drawings or specifications for the redevelopment of the Site under both covenants. The defendant denies that it has unreasonably refused such consent under either covenant.

3

By the 2019 Judgment, I held that the claimant's claim in respect of the defendant's refusal under clause 2(b) of the 1968 Deed succeeded because the defendant's refusal of consent on the grounds of aesthetics, trees and temporary loss of amenity was unreasonable since they did not affect the defendant's property rights (which were limited to loss of capital or rental value) and thus could not be relied on and the refusal on structural grounds was unreasonable in fact. The claimant's claim in respect of clause 3 failed. I dismissed the defendant's counterclaim concerning sums it sought to recover in respect of the cost of considering the claimant's applications.

4

The defendant appealed on the grounds that in law the defendant was able to take account of the property interests of the lessees of the flats at 89HP and that the decision on structural issues was inconsistent with the conclusions I had reached on clause 3. There was no appeal against my dismissal of the defendant's counterclaim. In the result, the appeal succeeded on the first ground but failed on the second and the Court of Appeal directed that the claim be remitted to me to determine whether in fact the refusal on aesthetics, loss of trees and temporary loss of amenity was reasonable. This is the trial of those issues. The trial proceeded by way of submission by reference to the evidence as it was in 2019.

Relevant Background

5

I can take the background to the issues that remain to be determined from the 2019 judgment. It is relevant for present purposes that the buildings shown on the Plan to the southwest of 89HP and west of the Site (“Woodsford Square”) are houses constructed in the 1970s. The building shown on the Plan hatched in black at the bottom of the Plan is Abbotsbury House, a 10 storey brown brick clad block of flats built in the 1960s. Abbotsbury House is located about 30 metres to the south of 89 HP. The crown of the trees relevant to this dispute are shown as they were in 2019 on the Plan outlined in red and are numbered. I refer to the trees individually by those numbers to the extent necessary below.

6

The defendant did not appeal my findings at paragraphs 3–4 and 20 (i) (ii) and (iii) of the 2019 Judgment and I proceed in this judgment on the basis of my findings that:

“89HP is a large detached Victorian building forming the end of a row of such buildings. It is divided into five flats, each held under a long lease of 999 years duration. The garden to the west and rear of 89HP forms part of the lower ground floor flat lease. Each of the flats' long leaseholders is a shareholder (or in the case of joint long leaseholders are jointly a shareholder) of a share in the defendant. The defendant retains possession of the internal common parts and external structure of 89HP but is otherwise interested in 89HP only as reversioner.

Abbotsbury House dominates the skyline to the south of 89 HP and the Site. As well as being much higher than 89HP, that building extends west beyond the rear building line of 89HP and the buildings similar to it located to the north of 89HP. Its lower stories are partially masked during the summer months by self-sown sycamore trees shown on the Plan marked 1 – 10. Tree 10 plays a relatively minor role in the masking process. Trees 1–10 are located on land forming part of the Abbotsbury House title. During the winter months, when the trees are not in leaf, the masking effect is limited, as was apparent on my view of the Site and 89HP at the start of the trial. Trees 11–13 are also self-sown sycamore trees that perform a similar (and similarly limited) function in relation to Woodsford Square…” and that:

“The Site in its present form is, as Mr. Rainey QC and Mr. Sefton QC put it in para. 26 of their opening submissions, “ … a piece of weed-choked waste ground …”. As long ago as 1996, the Site was described in a report to the LPA that led to an ultimately abortive compulsory acquisition scheme as having been “ …in a derelict and unkempt state for over 20 years and is an eyesore …”. The only material change was that on 23–24 February 2012 the claimant undertook some ground cover clearance. However, as recently as 10 April 2013, the local authority wrote to the claimant requiring her to tidy up the Site. Following my visit to the Site at the start of the trial, I concluded that notwithstanding the work done in February 2012, the LPA's 1996 description applies with equal force today as it did in 1996;

89HP is overlooked by (a) Abbotsbury House, a 10 storey brick clad block of flats located about 30 metres from the southern flank of 89HP and (b) to a lesser extent by the Woodsford Square houses;

… from the moment when it was created, the Site was always intended to be developed. It was never intended to be an open space or garden whether for the benefit of 89HP or otherwise”

7

The Site has had a long and complex history. At paragraph 6 of the 2019 Judgment I found that:

“Originally, both the Site and 89HP were in common ownership. By 1965, Brigadier W.B. Radford (“BR”), the then freehold owner of 89HP and the Site, had converted 89HP into five flats with caretakers' accommodation in the basement. Each flat was let out on short contractual or statutory tenancies. By a transfer dated 10 December 1965, BR transferred the Site to Ms F.E.D.D. De Froberville (“MDF”). By that transfer (“1965 Transfer”) MDF agreed within 2 years to build on the Site a building for which BR had obtained planning permission. MDF did not comply with this obligation and, on 10 July 1968, the obligations created by the 1965 Transfer were varied by the 1968 Deed. The 1968 Deed defined BR as being the “ Adjoining Owner” and MDF as the “ Building Owner”. In so far as is material, the 1968 Deed provided that:

“1. [MDF] hereby covenants with [BR] that she will complete the development of the [Site] … not later than the expiry of 18 months after the date hereof.

2 (a) In lieu of the drawings referred to in [the 1965 Transfer] [BR] hereby approves the general layout drawing no. 163/13 dated April 1968 prepared by Holmes and Gill.

(b) [MDF] shall make no applications to the appropriate planning authority nor apply for any other necessary permissions from the local or any other body or authority in respect of any plans drawings or specifications which have not previously been approved by [BR] PROIVIDED ALWAYS that if [BR] shall approve the same but [MDF] shall be required to modify or amend the same by the Planning Authority or any other authority or if [MDF] shall herself desire to amend the same then no further application shall be made by her to any such Authority unless the revised or amended drawings and specifications have first been approved by [BR]

3 No work shall be commenced upon the [Site] before the definitive plans drawings and specifications of the said buildings have first been approved by [BR] or his surveyor. …”

As in the 2019 Judgment, in this judgment I refer to the covenants relevant to this dispute (being clauses 2(b) and 3 of the 1968 Deed) collectively as the “ covenants”. I refer to each respectively as “ clause 2(b)” and “ clause 3” and to each of the individuals referred to in paragraph 6 of the 2019 judgment using the same abbreviations.

8

Various planning permissions were sought and obtained for the Site while it was in the ownership of MDF but in the end nothing was built and the Site was sold by MDF to a Ms Lange, who retained the Site without building on it down to the date of her death – see paragraph 8 of the 2019 Judgment.

9

In 2019, Mr. Marc Jonas (“MJ”) was the long lessee of Flat 2, which is the upper ground floor flat. Dr Michael McKie (“MM”) and Ms Maria Letemendia (“ML”) were the joint lessees of Flat 3 on the first floor of 89 HP. Each of MM, MJ and ML were the directors of the defendant at all times material to this dispute. MJ and ML gave evidence on behalf of the defendant at the trial...

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