Heritable Property – Title Conditions – Variation – Derelict site between flats in former hotel and seafront – Building height restrictions – Proposed 2-storey housing with outline planning permission – Effect of change of use, and division, of hotel building – Purpose of condition – Extent of impact on light of lower ground flat – Variation granted – Title Conditions (Scotland) Act 2003, Sections 98, 100

Heritable Property – Title Conditions – Variation – Compensation – Building height restriction – Proposed 2-storey housing – Substantial net adverse effect on light of benefited lower ground flat in neighbouring building – ‘Substantial loss or disadvantage’ – Effect on value – Competing opinions of valuers – Award of 5% of notional value of flat, i.e. £4,000 – Title Conditions (Scotland) Act, Section 90(6),(7)

Heritable Property – Title Conditions – Variation – Procedure – Amendment of application following decision granting opposed application but prior to final order – Applicants having indicated variation of plans but subsequently discovering variation unacceptable to planners – Amendment held competent and in circumstances allowed – Reconsideration of application, on basis that impact on respondent’s property worse – application granted with increase in compensation from 5% to 7% of notional value

Heritable Property – Title Conditions – Variation – Expenses – Variation granted subject to conditions and award of compensation – Application amended and reconsidered at further hearing, when variation again granted and compensation increased – Respondent’s application for expenses – Success in application for compensation – Parties’ conduct of proceedings – Respondent awarded fixed sum of expenses, primarily in respect of second hearing necessitated by amendment – Title Conditions (Scotland) Act 2003, Section 103

J & L Leisure Limited v Shaw
28 March, 1 August and 30 October 2006

In 1958 the owners of a hotel near the sea-front in an historic part of Dunbar sold a site with some single storey buildings between the hotel and the sea-front. Restrictions on the height of any buildings on the site were imposed. The site was used as an amusement arcade. The hotel was subsequently converted to flats. The amusement arcade fell into disuse and its buildings became dilapidated. Its owners wished to sell the site for housing on the basis of plans for two-storey housing for which outline planning permission had been conditionally granted. The owner of a lower ground flat in the former hotel building objected to variation of the title condition. He also sought compensation in the event of the application being granted. The applicants opposed compensation.

The Tribunal decided to grant the application, subject to plans which the applicants had indicated during the hearing could be amended by substituting a hipped roof for a full gable end beside the respondent’s flat. Compensation was awarded. Before the final order was made, however, the applicants sought to amend the application by reverting to the original plans because the planners had indicated that the introduction of the hipped roof would not be acceptable.

Held (1) granting the application, the applicants’ general case for two-storey housing development on this site clearly succeeded: to maintain the subjects as they were was unacceptable, and lower housing, as well as being uneconomic, might not be approved by the planners. The respondent’s particular situation had, however, to be considered: the change of use, and sub-division, of the hotel building did not alter the entitlement to enforce the building height restriction (although it might be a relevant factor if, following a sub-division, development greatly favoured the other divided units). On the evidence, there would be some adverse effect on the respondent’s flat, although that could be exaggerated as the attraction of the flat was already quite limited by its layout and an existing partial obstruction of natural light. On an examination of the terms of the title condition, its purpose was to preserve amenity and in particular sea views but also to protect the light. Weighing up the benefit and the burden, and considering the benefits and burdens which might result from modification of the applicants’ plans, it was reasonable to grant the application although it would adversely affect the respondent’s property to some extent.

(2) awarding compensation of £4,000, a finding of substantial adverse impact did not necessarily mean that there was any substantial effect on value, but, after weighing up the competing valuation opinions (in the form of written reports), the Tribunal considered that a hypothetical purchaser would appreciate that the subjects were likely to be developed and would have the height of development in mind. Knowledge of the variation of the condition would influence his bid. On the evidence, and for the purpose of measuring in a rough way the effect on value, a working figure of £80,000 could be taken as the value of the respondent’s flat and the effect could fairly and reasonably be assessed at 5% of that figure.

(3) allowing the application to amend, this was competent where the applicants had not indicated their consent to the award of compensation and the Tribunal’s final order had therefore not been made. Amendment at such a late stagewould not normally be granted, but in the particular case the Tribunal had in mind the lack of prejudice, in so far as the amendment was merely restoring the original proposals on which the application had been made and was not really presenting a new case, and also that it seemed to be in nobody’s interest to require the applicants to start their application afresh. Amendment was therefore allowed. Although the consideration of many of the factors was not changed, it was necessary to look again at the whole application, on the basis that a full gable end in close proximity to the respondent’s flat, in particular its sittingroom, was proposed. The impact on the light would be worse. Considering, again, all the factors, the same decision would be reached on the merits. On compensation, taking the same notional value as before, there was an increase in the effect on value, now assessed at 7%, i.e. £5,600.

(4) awarding the respondent (who was not legally represented, at least at the hearings) a fixed sum of £750 expenses, Section 103 of the Act required the Tribunal to consider the extent of success but the parties’ conduct of the proceedings could also be considered. The respondent had succeeded in his claim for compensation. Although he had lost on the merits following both hearings, the second hearing had been caused by the applicants’ fault and there was no criticism to be made of the respondent’s conduct. The award was primarily made in respect of the second hearing, which had been attended by the respondent’s valuer. (The applicants did not seek expenses.)

See full decision:  LTS/TC/2005/12 (Opinion) and LTS/TC/2005/12 (Note)