Cathryn Pernstich takes a look at additional factors that can impact and delay on the construction of a development site, which was purchased with a planning permission already having been granted. It is the intention of the purchasing developer to implement that planning permission.
As highlighted in a previous issue of Property Matters, purchasing a parcel of land with the benefit of an existing planning permission can be attractive to a developer. It can have distinct advantages. There can, however, also be difficulties that arise and which, if not dealt with could lead to that existing planning permission being worthless or even unusable – meaning that money spent purchasing the site has been wasted.
There are two specific areas where this may happen:
- The use of the plans submitted in support of the planning permission obtained – these will be quite fundamental to the implementation of a planning permission, as these form the basis of what will be built on the land. It may be that changes need to be made to the plans to amend the planning design obtained.
The plans will have been prepared by someone – normally an architect. That party will have the copyright in those plans, which means only that party has the right to use or reproduce them. The original developer may have purchased the copyright in those plans, so can then freely use them for whatever purposes wanted. For you, as the new owner to be able to use those plans freely, the copyright in the plans must be passed to you. This should be done by a Copyright Licence being granted to you on completion of your purchase of the property. Once this happens, you can use the plans as you wish.
- The preparation of planning reports – to obtain planning permission (particularly on larger schemes) reports such as travel management, environmental risk assessment, design schemes etc may need to be prepared. These evidence to the Local Authority information in support of the application for the grant of a planning permission. In much the same way as with copyright in plans that have been prepared, the benefit of the reports should be passed to you on completion of your purchase of the property. This is because you may need to have those reports re-issued or amended. You also need to have the benefit of them as you will be relying on them to have given the required information to support the granting of the required planning permission.
In addition, and in both scenarios, any lender may also need to take the benefit of the plans and/or reports prepared. The lender may want this, so it too can rely on those papers in the event that it takes possession of the property.
The case of Signature Realty Limited – v – Fortis Developments Limited  EWHC 3583 (CH) highlighted the importance of this often overlooked part of purchasing a development site. Using the plans prepared by the original architect (which were available via the Local Authority’s website) Fortis made several changes to the designed and re-submitted the plans for planning approval. It did so without the consent of the original architect. The Court found a breach of copyright, which meant that the plans that had been prepared were not useable by Fortis. Fortis could not, therefore build out as it potentially wanted. Often seen as a side point, this case highlights the importance of having the necessary Intellectual Property Rights in place. Not having them could be a costly and fateful mistake.
If you have any questions or would like to discuss any of the issues raised in this blog, please feel free to contact Cathryn, a Senior Associate within our Commercial Property team. Cathryn is contactable by telephone on 01737 854521 or by email on [email protected]