The Royal Parks Ltd v Bluebird Boats Ltd
| Jurisdiction | England & Wales |
| Judge | Mrs Justice O'Farrell DBE,Mrs Justice O'Farrell |
| Judgment Date | 11 August 2021 |
| Neutral Citation | [2021] EWHC 2278 (TCC) |
| Docket Number | Case No: HT-2020-000453 |
| Court | Queen's Bench Division (Technology and Construction Court) |
[2021] EWHC 2278 (TCC)
Mrs Justice O'Farrell DBE
Case No: HT-2020-000453
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
TECHNOLOGY AND CONSTRUCTION COURT (QBD)
Royal Courts of Justice
Rolls Building, London, EC4Y 1NL
Ms Camilla Chorfi (instructed by Bates Wells) for the Claimants
Mr Kevin Leigh (instructed by RIAA Barker Gillette (UK) LLP) for the Defendant
Hearing dates: 4 th & 5 th May 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.
This is the expedited trial of a dispute concerning the ownership of a boathouse and jetties (“the Boathouse”) located on the north west side of the Serpentine Lake, Hyde Park, London.
The freehold land known as Hyde Park is owned by the Crown. The First Claimant is a charity incorporated on 19 February 2016 at the instigation of the Second Claimant to assume the functions previously carried out by one of its executive agencies, the Royal Parks Agency, including the management of Hyde Park.
Since 1998, the Defendant has operated boating facilities at the Serpentine for the public.
By a concession contract dated 17 December 2004, made between the Second Claimant and the Defendant (“the Contract”), the Defendant agreed to replace the existing boathouse and jetties with the Boathouse and to provide boating services at the Serpentine Lake.
The original contract period of fifteen years was extended by agreement of the parties to 10 November 2020 but thereafter the Contract expired. The Defendant's concession has not been renewed, although it has been extended on an interim basis pending resolution of a challenge in separate proceedings by way of judicial review.
In these proceedings, the Claimants seek declaratory relief as to the ownership of the Boathouse, together with orders to restrain the Defendant from continuing to trade from the Boathouse and from removing the Boathouse from Hyde Park.
The Claimants' case is that the Boathouse is part of Hyde Park; it was constructed to form part of the land and belongs to the Crown. The Defendant has no right to remove the Boathouse on expiry of its interim concession rights in October 2021.
The Defendant's case is that it retained ownership of the Boathouse which remained a chattel and was not a fixture to the land; alternatively the Claimants are estopped from denying the Defendants' ownership of that part of the Boathouse that can be removed. It was designed so that it could be assembled in parts at the lakeside and subsequently dismantled. The Boathouse was a substantial capital investment for the Defendant and was intended to be removeable in the event the concession ended by effluxion of time or otherwise.
Background to the dispute
By a contract made on 1 April 1998, the Second Claimant granted the Defendant a concession for operating a boating service on the Serpentine Lake from the boat house and jetties then located at the lakeside.
In about 2002, the Claimants took the decision to re-tender the concession. Mr McErlean, former employee of the Royal Parks Agency, explained in his witness statement that the intention was to provide enhanced boating facilities that would generate income for the Claimants and for the operator. It was recognised that the existing boathouse and infrastructure required investment. As a result, applicants were required to include within their bids provision for replacing the existing boathouse and jetties at their own cost.
The Specification of Requirements document provided that the concession holder would be required to operate a boating service on the Serpentine. The concession holder would also be required, at his expense, to replace the existing boathouse and jetties, and to maintain them throughout the term of the concession. The Contract duration would be a minimum of ten years but subject to the investment proposals from the tenderer.
Paragraph 5.1.1 of the Specification provided that the price for a ten year concession was replacement of the existing boathouse and jetties i.e. that was the minimum level of capital investment required from the Defendant.
Paragraph 6.1.1 of the Specification stated that factors relevant to the Claimants' assessment of the tenders included the level of capital investment, the terms of the offer and the percentage share of gross profits that would be paid to the Claimants.
On 30 January 2004 the Defendant made its initial tender submission. On 8 June 2004 the Second Claimant invited the Defendant to re-submit the tender in accordance with specification and tender documents sent to the Defendant by email.
On 12 July 2004 the Defendant re-submitted its tender, including the following option:
“The present boathouse, nearing the end of its useful aesthetic life, will be replaced.
The new boathouse will be relocated nearer to the water's edge by 1 metre. This will allow the pavement to be reclaimed for pedestrians.
The kiosk AND ice-cream unit will be re-housed in the new boathouse's north-eastern corner, allowing Serpentine Road to be cleared.
Ernie Colicci has indicated his willingness to relocate to this new location if he wins the new mobile catering contract, and will pay a nominal rent to BlueBird. BlueBird will remain solely responsible for the entire building.
A new jetty will be floated on the south side of the new boathouse.
The existing jetties will be re-furbished with new decking timber, ‘D’ fenders and trim.
A new ferry and ferry service will run to a new jetty located near the Diana Memorial Fountain.”
The financial offer made by the Defendant was for a contract term of 15 years. Payments to the Claimants would comprise ten percent of gross annual turnover in respect of the boating service and five percent in respect of retail sales, with a minimum guaranteed income of £85,000.
Expenditure models produced by the Defendant showed indicative capital costs of £573,625 for the new building and £89,000 for the new jetties if they were extended; alternatively, £429,875 for the building and £76,000 for the new jetties, if a simpler design were used.
By letter dated 4 November 2004 the Defendant clarified that, if awarded the contract, the capital investment in the Hyde Park project would include £430,000 in respect of replacement of the existing boathouse and £76,000 in respect of the new/refurbished jetties. The financial schedules attached to the letter showed depreciation of the Defendant's capital investment over a period of 15 years to £0.
By letter dated 17 December 2004 the Claimants awarded the Defendant the Contract pursuant to which the Defendant would provide boating services at Hyde Park and Greenwich Park, stating:
“1. On behalf of the Secretary of State for Culture, Media and Sport, I accept your offer to provide the above services on the basis of your tender submitted on 12 July 2004 and varied as follows:
(i) You will invest the amounts detailed in your letter of 4 November 2004 (Scott/Pennington) to the timetable shown, unless otherwise agreed with the Authority. …
(iv) You will pay the Authority 10% of net [sic] turnover for the boating operation but will guarantee a minimum payment of £85K per annum…
2. This letter, your tender submission (as varied by the above) together with the following documents, will form a binding contract between the Secretary of State and your Company.
Schedule 1 – Specification of Requirements
Schedule 2 – Conditions of Contract (as varied)
Schedule 3 – Tender Submissions and Price Schedule dated 12 July 2004 (as varied)…”
The Contract Period commenced on 17 December 2004, with a term of 15 years, expiring on 30 November 2019.
By a licence dated 10 October 2007, the Second Claimant granted the Defendant permission for the demolition of the old boathouse and the initial preparation work for the construction of the new boathouse (“the Demolition Licence”).
By a further licence dated 22 February 2008, the Second Claimant granted the Defendant permission to carry out the works to construct the Boathouse (“the Construction Licence”).
Practical completion of the Boathouse was achieved on 9 September 2008.
By an agreement dated 14 January 2009, the parties agreed to vary the terms of the Contract, including a concession for the Defendant to sell additional items from the Boathouse and provision for events giving rise to compensation (“the Variation Agreement”).
By a further agreement set out in the Claimants' letter dated 19 March 2019, signed by the parties, they agreed to extend the duration of the Contract from 30 November 2019 to 10 November 2020 and to increase the percentage of gross turnover payable by the Defendant from ten percent to fifteen percent.
Proceedings
In 2020 the Defendant sought to renew the concession beyond November 2020 but the Claimants refused to do so. The Defendant issued a claim for judicial review, seeking to quash the First Claimant's decision not to extend the concession and requiring it to retake its decision, together with an injunction requiring the First Claimant to allow the Defendant to continue trading from the Boathouse.
On 9 December 2020 the Claimants issued these proceedings, seeking the following declarations:
i) the Defendant does not own the Boathouse;
ii) the...
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