Property Law uk

Maintained by Gary Webber

Property transactions.

The editors of this section of the site are Peta Dollar, solicitor who works as a freelance lecturer, trainer and writer (peta@petadollar.co.uk) and Alex Troup, barrister at St John's Chambers Bristol.


There are three items this month: two cases and an article
  • A missing term was implied into an overage provision obliging the buyer to sell the houses once they had been built.

  • On the correct interpretation of an overage provision the sale of affordable housing units to a social housing provider was not a disposal for “other social/community purposes”.

  • Article on the new Electronic Communications Code by guest writer, Thekla Fellas.


Overage provision
Implied terms

Sparks v Biden
[2017] EWHC 1994 (Ch)

Summary

A buyer/developer had occupied one unit and let the others on short-term lettings, thus apparently avoiding an obligation to pay overage on the sale of the units. However, the court implied an obligation into the contract, obliging the buyer to market and sell each newly constructed house.

Facts

Mr Sparks (S) granted Mr Biden (B), an experienced developer, an option to purchase a piece of land which had the potential for residential development. The agreement required B to apply for and use all reasonable endeavours to obtain planning permission and, if the option was exercised, to proceed with the development as soon as practicable.

In addition to the sale price, the option agreement entitled S to an overage payment calculated according to a formula, with a total minimum payment. The obligation to pay overage arose on the sale of any of the newly constructed dwellings, with any outstanding balance of the minimum payment only becoming due on the sale of the final dwelling.

Planning permission was granted and B exercised the option and completed the purchase, subsequently constructing eight houses on the land. Instead of selling the houses, B occupied one house himself and let the remainder of all but one of them on short term tenancies. The overage provisions contained no obligation to market the houses ... THIS IS AN EXTRACT OF THE FULL TEXT. TO GET THE FULL TEXT, SEE BELOW

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