Greenhalgh & Co is a firm of Chartered Building Surveyors that practice in the Northwest of England
The firm was founded in May 1987 and specialises in structural movement and loss of value due to various problems, such as subsidence, proximity of mining, flooding and the like.
We also provide expert witness reports on many aspects of buildings and their valuation.
News March 2016 (EPC and business rates)
From 1 April 2018:
additional hurdles will have to be overcome in order to let commercial
property. From that date, where the letting prohibition contained in
regulation 27 applies and the property has an EPC rating of F or G, a
landlord should not grant certain types of tenancies of that property unless it
can demonstrate that either:
(a) an exemption applies and that exemption
has been registered in the PRS Exemptions Register;
(b) there are no “relevant energy
efficiency improvements” that can be made or it has undertaken “relevant energy
efficiency improvements” to the property.
From 1 April 2023: a
landlord should not continue to let out such properties unless either (a) or
(b) above applies.
Beyond 2023: the MEES Regulations do not
provide for a future trajectory for the minimum level of energy efficiency but
it is likely that the 'E' rating will be reduced in order to meet the UK’s
legally binding carbon targets. What we do know is that the Secretary of
State must review the operation and effect of the MEES Regulations after five
years, ie in 2020 (reg 4).
It is possible that in the future the above
regulations may be further amended and the bar set higher regarding energy
The position regarding business rates is unclear.
Rateable value is defined (Sch. 6. para 2.
(1) 1988 Act) as:
Rent at which it is estimated the
hereditament might reasonably be expected to let from year to year if the
tenant undertook to pay all usual tenant’s rates and taxes and to bear the cost
of the repairs and insurance and other expenses (if any) necessary to maintain
the hereditament in a state to command that rent.
If a commercial property has an EPC below ‘E’ on 1stApril 2018 then the amount of rent it could expect would be zero. The question is…………. does that make the
rateable value zero?
Then there is the issue of repair.
The rating hypothesis contains an
assumption for the purposes of valuing premises that the premises are in
repair. The reason for this is obvious; it prevents rate-payers from
engineering a reduction in their rates by simply allowing their property to
fall into disrepair.
Repair work only becomes necessary
once the premises concerned are “out of repair”. The word “repair” has been
defined as the rectifying of damage or deterioration, that is: “the putting
back into good condition of something that, having been in good condition, has
fallen into bad condition” (per Lord Evershed M.R. in Day v. Harland and Wolff
Ltd.  2 All E.R. 387), or: “making good damage so as to leave the subject
so far as possible as though it had not been damaged” (per Atkin L.J. in
Galthorpe v. McOscar  (Digest).
These definitions of repair have
recently been cited with approval by the Court of Appeal in Quick v. Taff-Ely
District Council  (Digest) and Post Office v. Aquarius Properties Ltd.
(1987) (Digest). For the operation of the “old” law see Sotheby v. Grundy 
Accordingly, it can be said that premises
are not “out of repair” unless they have been damaged or have deteriorated from
an earlier physical condition.
Therefore one would have to
conclude that failure to improve a property regarding insulation and such like,
would make it ‘out of repair’ for a property to keep its rateable value intact. If this is not the case, then the rateable value would presumably beome zero
News July 2015
Fracking and shallow coal workings
On the 28th July
2014, the Energy Minister, Matthew Hancock, invited applications
for Licences in the 14th Landward Licensing Round.
Interestingly in the blocks of land offered; areas such as Bolton,
Westhoughton and Wigan were included, along with many other
past coal mining areas of course.
This in itself is not surprising, as they offer the potential
for the extraction of gas from shale.
What is surprising is that these very same areas have a significant
amount of shallow coal workings.
If one compares The Coal Authority Interactive map viewer
with the 14th Onshore Licensing Round map, one can see that there are large
areas which are classed as Development High Risk Areas.
A development high risk area is defined as: a part of the
coal mining reporting area which contains one or more recorded coal mining
related features which have the potential for instability or a degree of risk
to the surface from the legacy of coal mining operations. The combination of
features included in this composite area includes mine entries; shallow coal
workings (recorded and probable); recorded coal mining related hazards;
recorded mine gas sites; fissures and breaklines and previous surface mining sites.
During hydraulic fracturing, the microseismic events are
generally less than magnitude minus two (-2) or minus three (-3) on the Richter
scale.1 A study of hydraulic fracturing-related seismic activity in
England found that the combination of geological factors necessary to create a
higher-than-normal seismic event was “extremely rare” and such events would be
limited “to around magnitude 3 on the Richter scale as a ‘worst-case scenario.”2.
So should that worry us?
The answer is:
Probably ‘No’ in area which is not an ‘Instability High Risk Area’
Probably ‘Yes’ in area which
is an ‘Instability High Risk Area’
Up to press we have been unable to establish whether ‘Fracking’
is to be carried out in, or close to, Development High Risk Areas.