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Injury Prevention Week 17-21 August 2020

As Lanyon Bowdler is an Association of Personal Injury Lawyers (APIL) accredited firm, I was pleased to hear that APIL had decided to expand their Injury Prevention awareness campaign to a full week, 17 - 21 August. With schools going back in the coming weeks across the country due to the easing of lockdown, I have carefully been thinking about road safety, in particular concerning children.

All of these considerations gave me pause for thought. I have been involved in many cases over my years in the personal injury department at Lanyon Bowdler and have seen many child pedestrians injured by drivers not paying attention or driving too fast.

The Highway Code Rule 204 states that: “The most vulnerable road users are pedestrians, cyclists, motorcyclists and horse riders. It is particularly important to be aware of children, older and disabled people, and learner and inexperienced drivers and riders”.

Children are especially at risk during school pick up and leaving times, given their uniforms are generally of dark colour making them less visible when walking to or from school. A child is certainly less likely to be seen immediately by a driver than an adult would be.

Accidents involving pedestrians can cause injuries ranging from something minor to something more serious, leaving them with permanent physical and/or cognitive impairments and on occasion can be fatal. The Department for Transport conducted a review on child casualties in 2015 and concluded that children under 16 are the most vulnerable road users. This is due to them not being experienced and as well educated about using the road as most adults.

The charity, Brake, has also carried out research and in 2018 found that of 456 pedestrian deaths that year in the UK, 48 were children.

When faced with a personal injury claim, a Court will usually take the view that a vehicle is a lethal weapon, putting a high burden upon any driver when considering any reason they may put forward such as “they came from nowhere”. A Judge is often likely to take this as evidence that the driver was not sufficiently paying attention.

Even if a driver is found to be at fault insurers often allege contributory negligence against the pedestrian. Courts have to take into account the degree of blameworthiness and the contribution the negligence makes to the accident and injuries. A Court will assess the facts of each case to determine apportionment of liability between the parties. This is not easy to do between a child and a driver. This is where the burden is greater upon a driver of a “lethal weapon”.

Children are not adults and may not have the same level of self-control as an adult in dangerous situations. Case law indicates the level of contributory negligence increases as they get older.

Since no two cases are the same, this can be where the difficulty arises. Even though a Judge may find the defendant negligent for not keeping a proper lookout, they will also take into account the child’s age and actions, and apportion some blame to them as the Judge may be of the opinion that the child should have been aware of the dangers of crossing the road.

With the easing of lockdown I would urge parents to spend time during the remainder of the holidays in ensuring their precious little ones are up to speed on road safety by learning or being reminded of the Green Cross Code. I certainly will be. Prevention is better than cure as they say!

Proposed Changes to the Planning System

At present the world of planning and development is at the forefront of government reforms. There is an ongoing consultation into many changes within the planning system. This consultation seeks input into proposed changes to the planning system, including: changes to the standard method for assessing local housing needs, securing of first homes through developer contributions, temporarily lifting the small sites threshold and extending the current Permission in Principle to major development. In the coming months, it is likely that major changes will be considered and that many of these will be implemented.

To prepare for these changes, it is useful to understand why they are necessary.

Why Are Changes Being Proposed?

Firstly, the planning system that we follow today was put in place in 1947. This means that our guidelines were put in place only 2 years after the Second World War. Since then, many changes have happened externally, and although it has been reformed many times, the basic system has not, in the government’s view, been updated to reflect the years of development.

Secondly, the system now works best for large investors and companies, and is often impenetrable for those without the resources to manage a costly process. To implement a simpler framework would allow for a better support system and a more fair and competitive market. With a greater diversity of developers, England is likely to house a stronger foundation for the planning communities.

Since 2010 the government has introduced planning reforms to improve the outdated system. In 2010 only 17% of local authorities had local plans in place and now 91% of local authorities have plans. These changes have helped to shape the consultation that is currently ongoing and the viewpoint of many individuals and developers countrywide.

What Are the Proposed Changes?

Currently, planning decisions are discretionary rather than rules-based. Almost all decisions to grant planning permission are decided on a case-by-case basis. Given the number of applications that are being received daily in 2020, compared to the number in 1947, it is evident that this process needs to change. It is being proposed that a clear set of rules would be much more suitable for this process.

Secondly, it has been proposed to extend the current Permission in Principle to major development so that landowners and developers have a fast route to secure the principle of development for housing on sites without having to work up detailed plans first. This aims to speed up the planning process, encourage building and development during these uncertain times, as well as into the future, and to create a fairer system.

Furthermore, one of the most prominent proposals is the simplification of Local Plans, to focus on identifying land under three categories. These three areas are: ‘Growth’ areas suitable for substantial development, ‘Renewal’ areas suitable for some development and ‘Protected’ areas where development is restricted. The main aim of this proposal is to reduce the time it takes to secure planning permission. By having a simplified process in place, with an easier application process, it will be much less time consuming, for both the applicant and the local authority.

Subsequently, the plans refer to the local planning authorities being given greater responsibilities in terms of identifying sub-areas in their ‘Growth’ areas for self- and custom-build homes, so that more people can build their own homes.

As well as the above, temporarily lifting the small sites threshold below which developers do not need to contribute to affordable housing, will ensure adequate affordable homes are being built across the country.

What Changes Are Soon to Come into Force?

In the meantime, there is a lot of talk surrounding the planning sector at current and one of the main upcoming changes centres around how the planning system will work for commercial premises. From 1 September 2020 there will be a new Class E group, which will replace the following classes:

  • Class A1 - shops;
  • Class A2 - financial and professional services;
  • Class A3 - restaurants and cafes; and
  • Class B1 - business.

This will mean that planning permission will not be required for a change of use of premises within this new use class.

Given the current climate and the changes that have come about due to the Coronavirus Pandemic, many businesses and premises will perhaps become redundant and undesirable. Amending the rules in relation to planning consents is a first step to tackling the challenges that many commercial premises owners, and others, will face.

Help and advice

If you would like any guidance or advice on matters relating to any of the above, or otherwise, please do not hesitate to contact our property and planning departments at Lanyon Bowdler for more information.

Job Retention Bonus

On 31 July 2020, HMRC published a policy paper providing further details on the Job Retention Bonus (JRB), originally announced by the Chancellor on 8 July 2020.

The policy paper confirms that the JRB will be a taxable one-off payment of £1,000 for every employee who an employer previously claimed for, correctly, under the Coronavirus Job Retention Scheme (CJRS) and who remains continuously employed until 31 January 2021.

Employers may claim a JRB in respect of employees who transferred to them where either TUPE applies (or would have applied but for the previous employer's compulsory liquidation) or the PAYE business succession rules apply, only if the transferring employees were successfully claimed for under the CJRS by that employer (as opposed to only by the previous employer).

Employers will be able to claim for employees who:

  • Were furloughed and had a CJRS claim submitted for them that meets all relevant CJRS eligibility criteria.
  • Have been continuously employed by the employer from the most recent CJRS claim in respect of that employee to 31 January 2021.
  • Have been paid at least £520 a month on average between 1 November 2020 and 31 January 2021 (a total of at least £1,560 over the three months).
  • Have up-to-date Real Time Information (RTI) records for the period up to 31 January 2021.
  • Are not serving a notice period that started before 1 February 2021.

Subject to these criteria, employers can claim a JRB for all employees including office holders, company directors and agency workers (including those employed by umbrella companies).

Employers will be able to claim the JRB from February 2021 through a government website.

The policy paper states that more details of the process will be published in guidance by the end of September 2020. In the meantime, employers should ensure that their employee records are up-to-date, and that they correctly report their employees' details through RTI. Employers should also make sure their CJRS claims have been accurately submitted and any necessary amendments have been notified to HMRC.

Full Redundancy & Notice Pay for Furloughed Employees

The Department for Business, Energy & Industrial Strategy announced this morning that it is to change the law to ensure that all furloughed employees receive statutory redundancy pay and statutory notice pay calculated by reference to their normal pay, rather than a reduced furlough rate.

The changes will also apply to the calculation of:

  • statutory remuneration for time off to look for employment or arrange training;
  • compensation for failure to provide written reasons for dismissal;
  • basic awards for unfair dismissal and
  • compensation for failure to comply with an order for reinstatement or re-engagement.

The new rules are to be effective from tomorrow, 31 July. The full statutory instrument is here.

All of the above payments are calculated by reference to “a week’s pay”, as defined under employment legislation.

In very basic terms, a week’s pay in the case of employees who are salaried or otherwise normally entitled to fixed basic pay is a normal week’s pay as if they were working full hours (so 100% of normal pay), whereas in the case employees with fluctuating hours/earnings (and no core, normal minimum pay), it is based on the average of their pay during the last 12 weeks during which at any time they worked.

Prior to the introduction of flexible furlough, the average pay of the latter group would be affected by furlough only to the extent that furlough commenced or ended part way through a week within the 12 week reference period, as entire weeks spent on furlough would not affect the average pay calculation. However, since the advent of flexible furlough from 1 July, there has been more scope for the calculation to be adversely affected.

Under the new rules, for the purpose of calculating a week’s pay, time spent on furlough is to be treated as time spent working at the full rate of pay.

The statutory minimum notice periods that employees are entitled to in the event of dismissal (other than in the event of gross misconduct or some other fundamental breach of contract ) is, after the first month of employment, 1 week until the employee has been employed for 2 years, then a week for each complete year of service up to a maximum of 12 weeks. Employee’s are entitled to be paid not less than “a week’s pay” for each week of statutory minimum notice unless their contractual notice is at least a week longer than the statutory minimum.

For example, an employee with 12 or more complete years’ service who is entitled to 12 weeks’ notice will be entitled to full pay for the duration of their notice period, even if they are furloughed. However, this entitlement will not apply if their contractual notice entitlement is 3 months – in which event they will be entitled only to any reduced furlough pay.

Virus Isolation Period Extended from 7 to 10 Days But Shielding to End in England

The UK chief medical officer has announced that those with officially recognised symptoms of coronavirus, or who have otherwise tested positive for the virus, should now self-isolate for 10 days.

The updated NHS advice regarding self-isolation is here. This includes advice as to when isolation should be extended beyond the 10-day period from when symptoms first appeared.

It is recommended that those experiencing symptoms should be tested within 5 days. Of course, if a test is negative the person need no longer self-isolate. As a reminder, where this results in an employee missing fewer than 4 days of work, they will not be entitled to statutory sick pay (SSP). For further details of the special rules relating to SSP in the context of coronavirus, click here.

With effect from 1 August, the public health advice in England that those who are clinically extremely vulnerable to the coronavirus should shield will end, but advice in relation to shielding in Wales will remain in place at least until 16 August.

Brain Injury & the Impact of Coronavirus - Finding Support in Challenging Times

From the beginning of the coronavirus pandemic there has been drastic social change at an incredibly fast pace. Everyone, without exception, has faced their own struggles and it is clear that we are all still learning how to adapt to the ‘new normal’. There are certain groups of people however who are experiencing greater hardship than others. Amongst those are individuals with an acquired brain injury.

In response to the government’s guidance on managing the spread of coronavirus, many individuals made the decision to self-isolate and those, who are clinically extremely vulnerable, were advised to shield. Whilst these measures were put in place for the safety of all involved, self-isolation can have a detrimental effect on a person’s mental and physical wellbeing. Being confined to your home for long periods of time can cause feelings of loneliness, anxiety and frustration. In addition, the need to adjust behaviours and adhere to new rules and regulations can be a challenge.

For individuals who rely on practical or social support from carers and friends, the loss of assistance with essential activities such as shopping and cooking, placed them at a greater risk than the remainder of the population. It has been, and continues to be, a time of anxiety for them and their families.

According to a new study published by the charity Headway, more than half of brain injury survivors have lost access to rehabilitation services as a result of lockdown measures. The study showed that 64% of those living with the long-term effects of a brain injury reported a deterioration in their mental health as a result of the measures implemented to control the spread of coronavirus.

Headway UK provides a valuable source of up to date information and advice for individuals with an acquired brain injury and their families. Although a number of Headway groups and branches have had to suspend many of their face-to-face services in accordance with the government’s advice, they are going to great lengths to ensure that help remains available to those who rely on their services.

Headway’s helpline is open to anyone who requires support or information relating to brain injury and can offer reassurance and a friendly voice. These resources can be found online at Headway.org.uk.

Quarantine and Employment

The Government has stipulated that all those travelling into the UK from Spain, including the Balearic and Canary Islands, from 26 July onwards must self-isolate for 14 days. It has also warned that such measures might be applied from time to time in relation to any other country to which a requirement to “quarantine” does not currently apply if its rate of COVID-19 infection increases sufficiently.

What, then, are the options for employers in relation to employees who will are prevented from returning to work when due at the end of their annual leave?

Working from home

In any event, the advice of Public Health England remains until 1 August that people who can work from home should continue to do so; and from that date, whilst it will be at the discretion of employers as to how staff can continue working safely, working from home will be one way to do this; and in Wales the public health advice is to continue to be that workers are only allowed to return to the work place if it is not reasonably practicable for them to work from home.

However, the requirement to self-isolate on returning from abroad will mean that any children in a household will not be able to receive external childcare, and particularly where there are younger children, that could interfere with the ability to work from home of some employees who would otherwise be able to do so unimpeded.

As has been the case during the closure of schools and nurseries and other interruptions to childcare arrangements during the virus outbreak, employees with childcare responsibilities might be able to overcome this in whole or in part by agreeing with their employers to alter their working patterns for the 14-day period so that they can alternate childcare duties with a partner and/or do some work when their children are in bed.

Sick leave

When an employee cannot work because they are self-isolating due to a test and trace direction or a member of their household having displayed officially recognised symptoms of COVID-19, they will be deemed to be incapacitated and, if they otherwise qualify, they will be entitled to statutory sick pay (“SSP”).

However, the mere requirement to self-isolate following a return to the UK will not constitute deemed incapacity under the amended rules relating to SSP.

For the amended rules relating to SSP in connection with the coronavirus, click here.

Furlough

Furlough under the CJRS will only be a possible option if an employee has already been furloughed for at least 3 continuous weeks by 30 June, or returned from maternity leave or military mobilisation after 10 June.

Employers should exercise caution before furloughing an employee who is required to quarantine as, depending on the circumstances, this might constitute an abuse of the CJRS and, if challenged by HMRC, for example in the event of an audit, could result in not only a requirement to repay monies paid to employees, but also penalties.

Clearly, if an employer can demonstrate that the employee would have been furloughed after their return from holiday in any event, to implement that will not be an abuse.

Otherwise, if an employer has other employees on furlough, it might consider placing an employee who is required to quarantine on furlough in place of another employee: this surely couldn’t be seen to be an abuse of the CJRS as the total number of employees on furlough would remain unchanged.

Holiday

An employer might agree that an employee can take annual leave that would have been available to take later in the holiday year and/or in the next holiday year to cover all or part of the quarantine period.

If holiday is to be brought forward from the next holiday year, the employer should ensure that the employee still has not less than the statutory minimum 5.6 weeks holiday (28 days for a full time work) during the next year. That might be achieved, in some cases, where an employee has a contractual holiday entitlement of in excess of 5.6 weeks, by bringing forward holiday during the next year as well.

A well drafted employment contract will ensure that if the employment ends at a point where the employee has taken more holiday than they have accrued, the value of the excess holiday pay received will be repayable, including that it will be deductible from any monies outstanding to the employee. Where a contract does not provide for this, it would be prudent for the employer to agree in writing, as a condition of bringing holiday forward, that this will be the case.

Discretionary pay

Some employers might be prepared to make discretionary payments to employees for all or part of a quarantine period. This is a commercial decision for any employer – but before doing that, we would encourage them to consider the potential disgruntlement that might be caused to other employees who have exercised caution and decided against holidaying abroad, only to see their colleagues who did not do the same receive extra paid leave.

Non-payment

The bottom line is that if and to the extent an employee who is required to self-isolate on returning from abroad cannot work, absent any special arrangements agreed by the employer as per the above, the employee will not be entitled to be paid.

Video Witnessing of Wills to be Lawful..... Temporarily

Since 1837 the law has said that, for it to be valid, a Will must be executed in the presence of two witnesses. The witnesses have always had to be physically with the testator at the time the Will is signed. Since the start of the COVID-19 pandemic concerns have been expressed by many about the difficulty of fulfilling those requirements in a time of lockdown.

Until this weekend, there has been no announcement about any actual change in the law in this area. However, on 25 July, the government confirmed that Wills that are executed in the presence of witnesses who are not physically present but are present virtually through a live video linked (using software such as Zoom or FaceTime) will be deemed lawful.

This is historic. However, there are some important conditions and caveats and points to note:

  • Most importantly, the changes will be temporary and will remain in place until 31 January 2022 (or as long as deemed necessary). After that, things will return to how they have been before: two witnesses physically present at the time the Testator signs.
  • The law has not yet changed. The change is expected to be made by an amendment to the 1837 Wills Act by way of a Statutory Instrument in September 2020.
  • However, the intention is that these measures will be backdated to 31 January 2020 - the date of the first confirmed coronavirus case in the UK. This means that any Will correctly witnessed through video technology from that date onwards will be legally accepted (whilst this legislative change remains in place).
  • The vital safeguard of requiring two witnesses remains in place.
  • As has always been the case, the witnesses must be aged 18 or over, independent, cannot benefit under the terms of the Will (and nor can their spouse/registered civil partner) and should not be family members.
  • Electronic signatures will not be permitted.
  • Counterpart Will documentation will not be permitted.
  • Any video link used must be a live link and should (preferably) be recorded.
  • The government say that use of video technology for witnessing Wills should remain a last resort. Having read the government’s guidance, it seems there are some difficult and potentially time consuming (but also time constrained) hoops to jump through to get your Will executed in this manner. So I do not think any reasonable person would want to go down this route to execute their Will unless absolutely necessary.

People must continue to get their Wills witnessed the way in which we are all familiar - i.e. with the two independent witnesses being physically present - where it is safe to do so. We should remember that Wills witnessed through a window (where there is a clear line of sight) are already considered valid.

All in all, this seems to be a sensible offer by the government of a temporary work around to a problem that has bedevilled Will practitioners since the pandemic lockdown began.

There will be an outbreak (possibly viral but unlikely to be pandemic) of comment among Will practitioners in various online discussion forums following this announcement. On the whole, one would expect the response to be positive.

The line we take is that which the government recommends: that we will explore the use of online video witnessing as a last resort, where it is not possible either for us to supervise the Wills by being physically present, or where we are able to ensure our clients can arrange their own witnesses to witness the Wills by being physically present and socially distant.

CJRS & Notice Pay

We have been asked regularly since the inception of the CJRS whether employees who are furloughed can be made redundant and, if so, whether a grant can be claimed under the scheme to cover their notice periods. The answers have always been, and still are, “yes” and “yes” – despite some speculation in the press and on social media to the contrary.

HMRC updated its guidance on 17 July to expressly state to employers "You can continue to claim for a furloughed employee who is serving a statutory or contractual notice period, however grants cannot be used to substitute redundancy payments."

To be clear, grants under the CJRS cannot be used to fund payments made in lieu of notice: an employee must remain employed and on furlough if the grant is to be claimed in respect of notice pay.

There has been some criticism in the press, including over this past weekend, of employers claiming grants in respect of notice pay, and some larger employers have been moved to state publicly that they will not do so. Other employers who have used, or will be using, the scheme for this purpose have made the point that if they were not to do so, more jobs would be caused to be at risk. Regardless, the fact is that the scheme permits this.

I note that in some of the press reporting on this point, it refers to employers who claim a grant for notice pay having to pay employees in full for their notice periods, notwithstanding that they can only claim a grant for 80% (reducing to 70% in September and 60% in October), subject to the applicable cap (currently £2,500 per month). This is an oversimplification. Where an employee’s pay has been lawfully reduced whilst they are on furlough, a statutory obligation to pay them in full only applies in respect of the statutory minimum element of their notice period, and then only if the contractual notice period is not at least a week longer than the statutory minimum.

The statutory minimum notice period is nil until an employee has been continuously employed for a month, a week until the employee has been employed for 2 years, and then one week for each complete year of service up to a maximum of 12 weeks.

Therefore, if an employee with a contractual notice entitlement of 1 month is made redundant after 4 years whilst furloughed on 80% pay, they will be entitled to full pay for the first 4 weeks of their notice period (because the contractual notice period is longer than the statutory minimum notice period, but by less than a week).

In contrast, if the employee was being made redundant after having been employed for only 3 full years, they would not be entitled to full pay for any part of their notice period because the contractual notice period would exceed the statutory minimum period by over a week.

Shareholder & Partnership Housekeeping During COVID-19

During these unprecedented times, it is best to stay proactive and forward thinking. Over the last couple of months, we have noticed an influx of companies aiming to do exactly that. There are many ways to help make your company become future-proof; making these steps could prove vital for the future of your company.

The first important question to ask is, “does your company have a shareholders’ agreement?”. If not, and there are things that you would like to have in writing and agreed by the shareholders of your company, then why not use this time to get one drawn up? With business being quiet for most companies, there has never been a better opportunity to make this happen. Shareholders’ agreements can cover anything you want them to and are advantageous, as they do not have to be filed at Companies House. This means that anything agreed between the shareholders can be kept confidential whilst remaining legally binding.

Secondly, “are you wanting to prepare for the future and protect you company?”. If so, then have you considered having a cross option agreement drafted? This would help to ensure the smooth running of your company in the event of the death of a shareholder.

A cross option agreement is drawn up alongside individual life insurance policies, which combine to protect the interests in the shares on the death of the shareholder. For the option holders drafted into the agreement, they will be provided with ‘put and call options’. This means that the seller (the deceased shareholder) will be given a ‘put option’ to sell the shares held for a set price, on death, to the remaining option holders. Then, these remaining option holders will be given the right to buy, for the set price, through a ‘call option’.

Having such a cross option agreement in place can be vital when it comes to succession planning. We recommend that you consider entering into such an agreement in order to protect your interests and the long term success of your company.

Finally, “are you working within a partnership with no formal partnership agreement?”. If this sounds like you, then a formal partnership agreement can be beneficial for many reasons. The key reason being that partnerships governed by statute alone are constantly at risk of ceasing to exist. This is because, by law, if any partner to a partnership dies or becomes bankrupt, the partnership is automatically dissolved. Having a partnership agreement in place can deal with these possible scenarios, as well as others, in order to protect the interests of the partnership.

All three of the above agreements can help put you in a more secure position as a shareholder or partner, as well as providing certainty for the future of your company. If you have any questions or would like help preparing for the future, please get in touch with the corporate and commercial department for more information.

COVID-19 Pandemic & Loneliness

Whilst the global coronavirus pandemic has brought a host of new experiences such as working from home and online socialising, it has also brought its challenges and increased loneliness of many people.

We all feel lonely sometimes but the pandemic has intensified these feelings of loneliness amongst many of us especially during the weeks of lockdown and social distancing. From not being able to hug our family and friends to having to isolate for weeks on end; these are only some of the struggles that we have all had (and continue) to face during the pandemic.

So, how could Omega help to battle the loneliness that this time is bringing?

Omega is a small but passionate end of life charity based in Shrewsbury and works across the UK, with a strong presence in the West Midlands. They work hard to raise standards in end of life care by supporting caregivers over the age of 75 looking after someone with a terminal illness, people who are themselves end of life, and those who have been bereaved.

In 2012, Omega launched their befriending service, Chatterbox Action Against Loneliness. This programme is a free, confidential, short-term telephone befriending programme. It is designed to support those who are lonely and isolated due to their caring role, bereavement, age, or life-limiting and end of life challenges.

People are carefully matched with a dedicated volunteer Befriender who will make a weekly phone call throughout the programme to talk about the things that matter to you. Chatterbox offers additional emotional support and help with finding services, information and social groups etc.

Omega’s other services also include their ‘A Letter from Louise’ pen pal service. This is a free pen pal correspondence service that matches volunteer pen pal writers with clients, of any age, for regular friendly conversations and sharing of stories. Clients are carefully matched with someone of similar interest who they can write to and will also receive a hand-written, thoughtful letter. If clients don’t feel they can write back, they can send newspaper or magazine articles that interest them, photographs, or simply receive these special letters with no obligation to reply.

For more information on the Chatterbox programme, please contact the Chatterbox team on 01743 245 088 or email them at chatterbox@omega.uk.net.

Alternatively, for more information on the Pen Pal Service, please contact Carol Moody on 01743 245 088 or email her at aletterfromlouise@omega.uk.net.

Option Agreements - A Move Towards Strategic Land & Things to Consider

With COVID-19 impacting on the way we work and do business, it is not surprising that we are seeing an increase in demand for strategic land opportunities. More and more landowners are being approached by developers wanting to take an Option over their land and we have set out below some points to consider.

In simple terms, what is an Option Agreement?

In return for a usually non-refundable sum, the landowner grants the developer an option to purchase their land subject to them obtaining planning permission.

The attractiveness of an Option Agreement

Option Agreements can be attractive from both the landowner and the developer’s perspective.

From a Landowner’s perspective

  • A landowner can achieve a much higher price for the land than they would do selling at its agricultural value if planning permission is obtained.
  • A landowner may also continue to use the land up until the developer chooses to exercise the Option.

From a Developer’s perspective

  • An Option Agreement affords greater flexibility in terms of whether they would like to purchase the land in future.
  • The initial option sum payable to the landowner is often a fraction of the full purchase price and therefore a significant amount of money is not being parted with up front.

Things to consider

  • TIME – is there adequate time for the developer to obtain planning permission? Extensions to option period for appeals?
  • LAND – what is the extent of the land to be transferred – will a plan need to be drawn up and is sale by phases likely?
  • TITLE – does the registered title cause any issues?
  • PRICE – will this be fixed or based on a % of market value?
  • TAX – what tax implications are involved?
  • RETAINED LAND – unlocking for future development
  • CONSTRAINTS- restricting land dealings during option period
  • PROMOTION – land promoted into local plan for future development

We would advise that you always seek legal assistance when proceeding with an Option Agreement due to their complex nature. For further information, please contact us and I will be happy to assist.

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