Cllr Alison Kelly asked a large number of Members Questions and had a considerable amount of formal and informal correspondence. This has temporarily transferred to a private site and, following any changes that may be appropriate, may re-appear here.
Enquiries from and replies to Councillor Alison Kelly concerning Overage. Latest on top.
15.1.18. AK to NJH and ex Cllr Gerry Harrison incl latter's email to AK and NJH of 15.1.18.
2.12.15. From Karen Swift to AK in reply to hers of 20.11.15
20.11.15 From AK to Max Lansman, Camden requesting 4 separate MEs
16.9.15. Camden (Andy Thomas) to AK (Phil Jones copied in along with 5 council officers),
Thanks Nick. I know the lawyers are keeping an eye on things. Not sure it is the best use of your time.
I have just sent you something on Sheldon but in the light of this from you of 15.7.18, can you let me know if it could be helpful if I continue to forward such information (usually notifications from Companies House on companies that are or have been associated with Findon) or should I desist!
Further to mine of 15.5.18 and your reply, Companies House have informed me that the Striking off Action has been discontinued for Sheldon Construction SRVC (London) ltd. The notice says “Cause has been shown why the above company should not be struck off the register and accordingly the Registrar is taking no further action under section 1000 of the Companies Act 2006 pursuant to the Notice dated 16/07/2018.”
Hi Nick, our officers tell me they have nothing to add to the previous emails.
Dear Alison
Findon Urban Lofts Ltd which was the main owner and developer of the Talacre flats has, according to Companies House on 17th [sic] July 2018 been dissolved.
The entry reads "17 July 2018 GAZ2(A) Final Gazette dissolved via voluntary strike-off. This document is being processed and will be available in 5 days". Today (13.7.18) the document appears on the registry and merely reads "DISSOLVED. 05901449 FINDON URBAN LOFTS LIMITED This Company was dissolved on 17/07/18.
The previous entry on the register followed a First Gazette notice for voluntary strike-off and read "07 Apr 2018 Voluntary strike-off action has been suspended".
If there is any possibility that this weakens our situation when endeavouring to recover Overage, it must be of concern?
Further to mine of 5th June, a posting at Companies House for Findon Homes (UK) Ltd states "Striking off action discontinued" and "Cause has been shown why the above company should not be struck off the register ..."
I have no means of knowing if it were Camden or other(s) who caused this to happen.
Lets hope the Overage will be paid soon. If it is owed by the freeholder(s) and they try to recover from the leaseholders - freeholders normally pass every cost on, rightly or wrongly, as far as I know, the original leaseholders and their solicitors were alerted to the development being problematic - that I can prove!
I see that on 5th June a 1st Gazette Notice (GAZ1) for striking off has appeared on the Companies House site for Findon Homes (UK) Ltd. The same happened exactly a year ago and it was followed by a notice stating that "Cause was shown ... so no further action taken".
Its last accounts were at 30.6.16 and showed a net asset value of £467k. Various filings in the last year have shown a change of director to Sureth Muppatti, Indian Nationality. Also, that one of Findon's age old nominees is a person with significant control.
I believe that until the Overage owed on Talacre is paid, no company that is remotely connected to what has happened there should be allowed to disappear.
Thank you and I welcome your passing what I said on to all the relevant departments.
Companies House has just filed that Sheldon’s compulsory strike off has been suspended which I assume means that someone, perhaps Camden, has objected.
I am not surprised at Camden’s response to you since as far as one knows, the Overage obligation rests with the freeholder who is a separate legal entity even though there may be common shareholders, side agreements and so on. However, my gut feel is that once a company disappears, any leverage that there might be is lessened and it would be a pity if one found later that that allowing it to disappear were something regretted – fear of the unknown, if you will.
Creek Road Ltd, one of Findon’s other six projects, was finally struck off last week. It was one of the two projects that Findon employed Lancsville to build and when Lancsville went bust, the site was dead for a long time. Construction was completed before Talacre was started. The unsecured creditors of Lancsville amounted to £29m and received nothing so there must be a lot of disgruntled people around.
One of the other spaces to watch, I think, is Citidwell whose striking off was discontinued on 1.6.16. A Findon person, Yotam Yinhal was shown as having significant control but he was replaced on 24.7.17 by a Mr Surish Mupparthi, Indian nationality. Last heard of, it had a net asset value of £200k. However, its main area of interest I believe, should be its totally inaccurate recording of traffic which appeared to have been accepted by Camden as justification for waiving Findon’s (now “anyone with an interest in the land” (I quote Camden’s legal dept) ie including the leaseholders) obligation to provide marshalling. That is something for which I had and hopefully still have, evidence in the event that some form of enquiry takes place into the behavior of the very individuals and parties.
What you say is all noted and thanks for your continuing interest .
I passed your e-mail to our property services , finance and legal officers to consider. They have informed me that based on the advice of Counsel they do not think the points you raise about Findon and Sheldon impact on potential recovery of overage –because these companies are not the focus of their investigations about overage.
Our officers are continuing their efforts and I am continuing to ask for updates about this on a regular basis.
All best wishes, Alison
PS Please note Nick - this is the best email address to use for me
On 8.5.18, A 1st Gazette notice for compulsory strike-off was issued for Sheldon Construction (SRVC) London Ltd. Strike off to occur in 2 months unless cause is shown to the contrary. Their last accounts showed a deficit of £2.3m, all owed to unnamed long-term creditor(s). Sheldon is a contracting company set up and controlled by Findon to take over the construction of two of Findon’s four other major housing projects when Lancsville Construction, a small but long standing construction company went bust with ordinary creditors receiving nothing. Sheldon were given the contract to build the Talacre development. (Nothing improper with that, and quite sensible for a developer and contractor to be the same). Its earlier directors included Assaf Laznik and Benjamin Pollock (son of David Pollock, founder of Greene and Co).
Findon’s involvement on paper appears to have changed in the last two years. On 18,3,16 Sheldon’s Registered Office moved from Spectrum House, Gordon House Road to 21 Bedford Sq, WC1. The former address has been common to several Findon related companies. The latter, less so. On 9.3.16, Yotam Yinhal, a Findon person resigned as director and an unknown, Mrs Sumaroka, a Ukrainian, became the only officer. She resigned 15.8.15 and Mr Kulak Oleksandr was appointed. On 24.4.17, the Confirmation Statement filed at Companies House, dated 15.2.17 shows Kulak Oleksandr, “Country/State usually resident: Ukraine” as controlling at least 75% of the company. Sheldon has an issued share capital of £1.
This is rather similar to what I wrote about on 27.2.18 re Findon, following which, for whatever reason, its striking off was suspended “as an objection has been received by the Registrar”. For the Talacre developments at least £3m is or should be owed for Overage. Until it is paid, there must be some uncertainty as to whether companies such as Sheldon, Findon and other connected companies should be allowed to become extinct.
Thanks Nick. I remind officers about every two months. They know I haven’t given up. And won’t.
I’ll discuss more fully after May 3.
Dear Alison
A further FOI response was received on the above in the last week. It reads –
Request;
“I refer to request dated 26.9.17. Ref: 21067024 [Previous response attached] and your response dated 23.10.17.
Please update me as to the current situation on the payment of “overage” due three years ago from the sale of Dalby Street and the Travellers site prior to the development of flats now called Princes Park on Prince of Wales Road.
In particular (a) Please inform me as to how much Camden was due, (b) how much has been paid and (c) the situation with regard to obtaining payment of any amount not yet recovered.
Further, please inform me as to whether you are objecting to Findon Urban Lofts Ltd application to be struck off the Companies Registry or if there is no possibility of that company having an ongoing liability for overage to Camden”.
Reply; The Council do not have anything definitive further to report. Officers (with the input of lawyers and inquiry agents) have been continuing their active efforts to resolve an extremely complex situation, both in terms of identifying quantum of any overage payable and the party by which it would be payable. Officers are not of the view that Findon Urban Lofts Ltd would have liability to pay any outstanding overage.
Also, on 7.4.18. Companies House recorded –
“Striking off action suspended Notice.
05901449 Findon Urban Lofts Limited
Action pursuant to Section 1003 of the Companies Act 2006 for the striking off and dissolution of the above company has been suspended as an objection has been received by the Registrar.”
The Striking off application was made by Nick Nicholas of Nicholas & Co, I can’t tell whom the Objection came from – I would like to think it is Camden eg on the grounds that they cannot be 100% sure that Findon aren’t liable. However, I was aware some years ago that many buyers of flats on Findon’s other projects were extremely dissatisfied.
Also (probably not important but how can one be sure some cunning game isn’t being played), On 8.4.18 Companies House informed me that an application has been submitted to have Findon Urban Lofts Plc No 05901449 struck off. No such company exists as FUL Plc’s name was changed to FUL Ltd some years ago. The same company Number (05901449) as for FUL Ltd is in the application but to date it doesn’t show on the Companies House register for that number.
A Land Registry search of NGL637463 shows the owner of 52 PoW Rd to be the same as it has been for many months, Hazlewood Properties Ltd of the BVI and c/o Nicholas & Co (solicitors well known to Camden). That search shows who are further down the chain ie 30 private flats on 125 year leases, 6 on 999 year leases, Medical Centre, 20 years, “affordable” flats 125 years.
The FOI response is encouraging in that it appears to be refreshingly frank (eg "inquiry agents"). What it does show up is something that has been apparent for ages. That either or both the land sale contract was badly drawn up or that it was badly carried out. For example, by allowing occupation of the private flats before the overage was paid.
I think the time may come when this deserves a wider audience. Before you became a Councillor and took such an active, and for me, welcome involvement, I frequently circulated all Councillors and a mailing list of about 100 people who had shown an interest (often by following up my leaflets on the Treetops counter). Response to wider circulation varied enormously with interest shown in unexpected places and vice versa.
Dear Alison
I see that today, Findon Urban Lofts Ltd has filed an application to be struck off the register of companies (or whatever the technical term is). The relevant page should be here.
I hope Camden will resist that happening while there is any possibility of any present or past shareholders or directors having any responsibility for Overage.
I hope you and Camden's legal dept agree and can act accordingly.
I last chased immediately before Christmas. Not giving up.
All best wishes
Alison
On 15 Jan 2018, Gerry Harrison wrote:
Hello Nick and Alison (or should it be Alison and Nick)?
Paul Braithwaite copied me into your correspondence, partly also to let me know he is off to Thailand, as intrepid as ever.
He also knows that when I was a councillor I was trying to keep at arm's length from certain shenanigans to do not so much with the Talacre site itself but the disgraceful development that took place beside the railway line, which meant the demolition of a travellers' site and some chicanery re the access road to the Talacre Centre. I was privately lobbied by the first developer who lived in Alma Street around the corner from my home in Inkerman Road. Jane Roberts and John Thane were aware of this. I thought it was all very fishy and told the developer to "hoppit" (it was a bit ruder than that!)
From the rainy Wild West of Ireland it is good to read of such battles still being fought, with concerned councillors and local activists tilting together against the windmills.
Best wishes to you both, Gerry
Dear Alison
It is now over 11 weeks since I last heard anything directly or otherwise from Camden on Talacre Overage
To follow this up, and hopefully put pressure on, I have been relying on my questions to you and FOIs submitted by others. I wonder if you are in a position to get an update on the situation? I last wrote to you on this on 17.11.17 but I don’t think you replied though I have been having computer problems.
Up until when you became a Councillor and were putting so much effort especially behind the scenes, I used to send updates on Talacre as and when it seemed appropriate to those who had shown an interest (initially people who had responded to the leaflets I put in the reception by Treetops). Also, to Councillors and others whom I had come across. In total about 150 with many responses, including from some unexpected Councillors and about a dozen circulations.
My list will be very out of date but nevertheless, I am wondering if the time hasn’t come to send an email out to these people. It only takes a very few people who take the trouble to look at the detail which I am confident is accurate, for there to be meaningful pressure and I believe the argument that more can be done behind the scenes may no longer be valid in this case?
I am able to provide very detailed chapter and verse to prove that either over £3m is owed or, that there has been incompetence or manipulation on the part of Council Officers and their advisors.
Anyone who is interested can find the information on the legal agreements on the sale of the land and the calculations and data used in them on the https://sites.google.com/site/talacrefacts/Home site.
Until recently I was able just to refer to www.talacrefacts.org.uk as I owned that domain name but in a fit of economy, I didn’t renew it by 1.1.18 and as you may see if you click on it, it has been snapped up by a site which seems to have no connection with Talacre anywhere. Curious!
My previous experience is that I would run the risk of threats to sue me for defamation, but I am prepared to run that risk – previously I heard no more following my replies to two letters from Carter Ruck and I was able to find a specialist solicitor/advocate to take on my case pro bono should it have been needed.
Dear Alison
Having heard very little via you for ages on the “Overage” situation, I arranged for an FOI request to be made the response to which I have only just seen as I have been away for several weeks.
I am sure there will be officers and others who promoted this project who are hoping this topic will go away so I do hope the interests of the public are being protected. Manifestly, the agreement should have prevented the private flats from being occupied until the amount of overage was established and paid. I just hope that behind the cloak of secrecy that Camden is able to claim, there is a determination not just to “learn lessons” but to collect the £3m odd from somewhere. Also, to hold to account those who have allowed this situation to occur.
I do hope that you, as a Councilor, are able to get more information than is provided in this response which follows-
“Date: 23 October 2017
Ref: 21067024
Dear Requester
Thank you for your request for information dated 26 September 2017 about “Overage" due two years ago from the sale of Dalby Street and the Travellers site. We have dealt with this under the Freedom of Information Act 2000 and/or the Environmental Information Regulations 2004
Response
The council holds the information requested and the answers to your questions are as follows:
Please inform me as to the current situation on the payment of "overage" due two years ago from the sale of Dalby Street and the Travellers site prior to the development of flats now called Princes Park on Prince of Wales Road. In particular, how much Camden was due and how much has been paid.
The current situation is still being assessed. The assessment is being carried out with the support of external legal, technical, and professional advice because of the complexities and the number of variables that need to be considered.
Also please provide me with the report of the independent external consultant who was appointed to advise on this.
All external advice forms part of an overall package of advice prepared by an external legal advisor and is exempt from release under the Act. .
Refusal notice section 42 - Legal Professional Privilege
Legal Professional Privilege (LPP) covers communications between lawyers and their clients for the purpose of obtaining legal advice. Section 42 ensures that the confidential relationship between lawyer and client is protected.
This exemption applies because
• A claim for legal professional privilege could be maintained in legal proceedings with respect to the Council's legal position regarding the report.
• The public interest is in favour of maintaining the exemption and outweighs the public interest in disclosure.
The public interest arguments for releasing this information are as follows
• It would improve the transparency of the decision making process
• It would allow the public to know the contents of the report
The public interest arguments for withholding the information are as follows
• The Council received the report in the context of it being part of a package of confidential legal advice
• Disclosure would have the potential to prejudice the Council's ability to defend or prosecute its legal interests, either directly, by unfairly exposing its legal position to challenge, or indirectly, by diminishing the reliance it could place on the advice having been fully considered and presented without risk of disclosure
• The package of legal advice was of a comprehensive nature and without it the quality of the Council's decision making would have been reduced since it would not have been fully informed of the legal issues and this would be contrary to the public interest
• It is in the public interest that the decisions taken by the Council are taken in a fully informed legal context
It is considered that the public interest in withholding the information outweighs the public interest in disclosing it.
Further Information: … STANDARD TEXT
Yours sincerely
Information and Records Management Team
By the way, in rereading previous correspondence, I see I used a word “unsarcastically” – it should have been “uncharacteristically” – I blame the spellchecker..
I hope you feel able to forward what follows to the competent officer in case it adds something of relevance to attempts that are being made to recover overage.
I monitor Findon’s filing at Companies House as I think it likely that they have a responsibility for overage albeit indirectly and therefore they may maintain they have no outstanding debts and liquidate themselves.
According to Findon’s 31.12.16 accounts which they have just filed at Companies House, they had funds of £6.8m mostly made up of amounts owed to the company of over £6m. That £6m almost certainly includes at least £3.5m owed by Findon’s shareholders, the details of whom are obscure, but likely to lead back to the Laznik family.
Notes in these 2016 accounts state under Related Party Disclosures (what follows is exactly as shown ie spelling and grammar).
“The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.
At the year end, there was outstanding balance owed from its shareholders within one year amounting to £499,803 (2015: £499,803). The loan carries out an interest of 3.6% as per the agreement dated 17 September 2014. The accrued interest for the year is £16,494 (2015 - £16,494).
At the year end, there was outstanding balance owed from its shareholders within one year amounting to £3,500,000 (2015: £3,500,000). The loan carries out an interest of 3.6% as per the agreement dated 17 September 2014. The accrued interest for the year is £192,445 (2015 - £126,526)"
The above is exactly as shown so it appears there were two alternative texts and they perhaps mistakenly published both. These were not consolidated accounts unlike those published in earlier years and that seems to make a difference as to whether they show the receivables as due from shareholders or not.
Overage is, we know, owed by the freeholder who remains (I checked today), Hazlewood Properties UK Ltd – a BVI company whose shareholders are not known.
I can’t resist speculating on the impact of say £3.5m overage. Hazelwood are shown as having paid £2.5m for the freehold. The property is charged to Alpha Bank London who presumably would have some priority over Camden should Camden seek to put Hazlewood into liquidation. The ultimate obligors might become the owners of the flats – whose owners and solicitors were all warned of the unusual aspects of their titles when they bought!
Thanks, good to hear from you as, uncharicaristically I had no response from my earlier email so feared I was getting the same treatment as someone else (who recently was awarded an MBE) and with whom I would not wish to be compared!
Unless you think it would be helpful, I will hold off until I hear from you, or say 7th Sept. It would be good to get a copy of the "independent external consultant's" report which an FOI should flush out?
I am not seeking a reply to this.
Was thinking about you today. And reflecting whether my reminder of about four weeks ago should be repeated. Probably better to wait until early September when Camden people are back from their holidays was my conclusion.
Not having had a reply to mine of 25th July, I was about to ask someone to put in an FOI request for an update and for the report of the independent outside cnsultant. However, I thought it best to check whether you had any information first to avoid seeming to harass the Council?
Regards, Nick
Re Talacre Overage. The last I heard from you was 3 months ago and of course we have had the Chalcots since but it seems reasonable to enquire again whether Camden has yet obtained settlement of this. Since an outside "expert" was appointed a long time ago to opine on this, one would expect that at least his or her report would be available.
Thanks Nick. Awaiting a response to my prod on 11 April.
I last chased this in March I think. My understanding is that the issues are incredibly complex and nothing is straightforward at all. Officers know I am on the case and won't give up. There will probably be a legitimate question at the end on lessons learned.
Dear Alison
Do we still have no news on the Talacre Overage issue?
It seems to me that if it is dragging on, I need to find someone to put in a FoI request - do you think that would be counter productive?
I was interested to see, via one of the 100 or so people I used to contact on Talacre, that 38 degrees are running a campaign to make viability calculations for justififying less than 50% affordable flats on new developments publicly available. The topic is very similar to that of Overage where any Council that is weak is liable to be conned by developers. An article that 38 degrees sent from the Guardian a year ago totally supports what I found when I looked at the assessment criteria for the 50% requirement ie that any developer can avoid the intent of the requirement by producing dodgy estimates. It is claimed that Islington, Greenwich, Lambeth and Bristol councils now make sure that finaial viablitly assessments for affordable flat content are made public Camden (and I suspect many others), don't presumably on gruounds of "commerical confidentiality" - hence the 38dagrees campaign.
Dear Alison
I would think that if it is highly complex, that is a failure of the Legal dept in allowing something to be signed that cannot be easily enforced - and we are talking a little and a lot of money - an incredibly cheap price for the land and a huge amount of profit to be shared.
I just came across the attached which might be of interest - no need to reply though! One is the flyer advertising the exhibition in 2007 when the public were encouraged to see what a wonderful scheme it was, including the Overage provision. On behalf of Trac (whose advisor, Chris Shaw probably wrote the Overage clause and did the appraisal, but did the Legal Dept check it?). Put out by Weber Shandwick, director Luke Akehurst ex agent for Frank Dobson, member of Labour List, on Newsnight a couple of nights ago and now working for an Israeli govt front or similar. Both spoke in favour of the scheme when it came up tor discussion at a meeting in the Town Hall, chaired by Mike Green who told a baffled delegation there to oppose it, that Shaw was so well known that he needed no introduction. The other a photo of Luke Akehurst facing the camera and Mike Green and Keith Moffitt queueing at the exhibition.
Chasing never give up. Highly complex as you know.
Is there any news yet on the Talacre Overage? If an outside expert was appointed some time ago, presumably they must have reported?
Chasing. Not given up.
Dear Alison
As I mentioned in my other email this evening, I have been making enquiries on Overage beyond just Talacre. Since April, I have sent FoI requests to all 11 Inner London Council plus the City and 6 others. I have just now put the current state on two websites, the links to which are below - I haven't given them to anyone else as I am pondering what to do at this point for the best. Let me know if the links don't work.
"London Overage" here. This has a Home page which explains and has what you may find an interesting summary. Then pages for each of the Councils, including Camden but excluding Talacre.
"London Overage Extra" here. It is intended for anything not suited to the main site and includes a page for Talacre.
If you have any thoughts on this let me know. Because of what we have both learnt due to Talacre, we are two of the few people who have some understanding of this topic, I suspect. Apart, that is, from those who have a personal interest and/or who would prefer it not to be discussed.
I wonder if you have any more news on the overage obligation for Talacre?
Since April I have been trying to get more information on Overage beyond Camden and will email you separately on that topic in the hope of interesting you..
Thanks Nick. No new information. It all takes so long.
Dear Alison
This is an FOI response someone has just received from Camden on Overage for Dalby St. I don't know if the appointment of an outside firm adds to the information you have. It looks like a step in the right direction. If the advice (or is it decision?) is that anything less than, say, £2.5m is due for overage, then I think the wording of the land sale agreement will have been defective. If it is owed and not paid, then presumably Camden can effectively foreclose on the freehold, owned by a BVI Company.
"You requested the following:-
This is a request for information on the Overage obligation contained in the sale agreements dated 19.4.2005 and 6.7.2007 between Camden and TRAC concerning 52 Prince of Wales Road and property relating to Dalby Street Please provide mewith details of the amount that has been paid or is payable for Overage. Alternatively, if no payment has yet been received, please inform me as to
the current situation, how much is claimed and when it will become due?
Our Response:
We can confirm that no overage has as yet been paid in relation to 52 Prince of Wales Road and the property at Dalby Street.
As with other overage clauses, the mechanism for payment of overage in this case is extremely complex, depending on assessment of multiple factors, many of which are commercially sensitive and that require in-depth expert analysis. The Council is currently undertaking this assessment with the aid of independent external consultants, with a view to assessing the amount (if any) of overage that may be payable.
We hope the information provided answers your question/s"
Nick, last chased two weeks ago and received a full response. Council is now on the case. Have just sent a chaser.
Dear Alison
I am wondering if you are in a position to update me on the overage situation on Talacre? If not, could you let me know so I can try another route.
I also would like to ask Camden for details of other agreements made in the last years where there is an overage agreement.
Trying to benefit from what I have learnt over the last few years, I have started asking other boroughs about agreements that have contained overage clauses. Given that councils usually take the full 20 working days to reply to FOI requests and that I have started with only a small number, I only have a partial picture but even so, it is proving to be very interesting.
When I emailed you last it was mainly about the Carlton Tavern and the enquiry that followed its blatantly illegal demolition. In the last few days the inspector has ruled entirely in favour of the Council and the owner (prima facie the developer, but one assumes that will change) has an obligation to rebuild it “brick by brick”. I think it is important as a precedent so councils feel empowered to fight against breaches of planning consent, rather than use “proportionality” and so on to trump justice. One unfortunate thing is that, from my understanding from a conversation with the Westminster legal team, both sides agreed to bear their own costs so the developer will have not suffered as much as he deserves and the Westminster residents will pay a considerable amount for its excellent QC etc – but I expect they can afford it!
Dear Alison
I wonder if you have heard anything more on Talacre overage?
I am very much open to persuasion otherwise but see Overage as an important topic beyond Talacre. Hence I have tentatively started sending FOI requests to other boroughs. First off, Westminster who responded with a list of 3 developments where there were overage agreements but nothing beyond the names of the developments. I am now waiting for something from 4 others, not including Camden which, of course, is a special case for me. In due course, I shall endeavour to obtain more information than just the name of a development.
Co-incidentally, I have been following the Carlton Tavern situation which of course is in Westminster (though Carlton Vale must be close to Camden). I have been aware of it ever since the developer had it demolished overnight in order to prevent it being listed. The enforcement people at Westminster (perhaps not as under-resourced as Camden) have been extremely robust. A 5 day hearing ended on 24th May and was very interesting.
Out of the blue, Counsel for Westminster informed the Inspector that she had learnt the previous day that Kieran Rafferty of KR Planning, the expert planning advisor to the developer, was not a member of the RTPI. Rafferty waffled saying his membership might have lapsed and he would produce evidence on the next day of the hearing. Come the time, he admitted that what he had said was untrue and the attached piece of paper [1] was tabled (I think I got the only copy other than those given to the Inspector and Westminster so it was photographed by the West End Extra/CNJ and Brent & Kilburn Times/Archant journalists and by a local activist who put it on facebook). Rafferty’s evidence was pretty comprehensively trashed with him having to apologise for what he described as “cut and paste” errors. The reason I am labouring this is that Rafferty has clearly advised many developers - he admitted to having passed himself off as an RTPI member for at least 6 years. A brief search shows him advising on what I think must be the Stay Club – see [2].
The Inspector’s decision is expected in about 6 weeks, the evidence Westminster produced seemed to leave no scope but for the developer to be required to rebuild the pub but with experience of the Hutton and Talacre enquiries, who knows.There were rumours that the developer is connected to the Magdala and Talacre but I don’t think it is more than that the developer is an Israeli citizen, operating directly or at one removed through offshore companies. Curiously the Land Registry has an identical restriction for both the Carlton and Magdala land in section B, dated 22.12.2015 about an order of the High Court and S & S Quality Builders.
I have a longer version - if you at more - including mention of the Stay Club, Magdala and Talacre which I sent at their request to the journalists (I doubt if they will find anything newsworthy though the Archant one said she might send it to someone they now have who does “investigations” – Emma Youlle I think).
Please feel free to copy any or all of this to anyone you feel may be interested.
Still chasing nick. Last time on Thursday. Yes flats are being occupied.
Dear Alison
I am often asked about the Overage situation on Dalby St so was thinking of providing a text for one of them to put in an FoI but if you have recent information, that would be better?
On the Affordable flats, I imagine they are all now either occupied or spoken for. I asked someone who had contacted me and she said she had gone to the open day which was several weeks ago now and there were masses of people but she had decided not to apply as she was "not convinced" whatever that meant. She said you had to fill in an application there and then.
Thanks, Alison.
Camden is actively on the case Nick. Last update yesterday.
Dear Alison
You may have seen a letter in yesterday's CNJ that mentioned in its last para the Overage liability at Talacre. Esther has for a long time been keen to publicise this topic so I did see though hardly influenced it.
I am thinking of sending a letter to the CNJ, first draft below. What I lack is any update from Camden on where they are on it. For all I know a realistic amount may have been both assessed and paid! I always think it irresponsible to make assertions (or is in this case, imply something) without checking the facts where that is possible. I am therefore wondering if you have heard anything further?
If I don't hear anything, I might find someone in the property dept to ring - that sort of thing sometimes has worked - or just send it.
"To CNJ Letters Editor
[Verification. The curious word “Overage”, linked here, does exist! Also evidence of the contract and that something is potentially due]
In “Having your say on housing … really”, CNJ 18 February, Esther Whitby refers to a potential substantial amount of £3 to £4million due from the developer of the Princes Park flats at Talacre. I hope you will allow me the space to elucidate.
Nearly all the land that the flats and new access road to the Sports Centre has been built on was sold by Camden to the then developer for £651,000 – yes, six hundred and fifty thousand! Only half was paid with the other half exchanged for his share in what is known as an “Overage” agreement. That agreement requires any profit made by the development over a defined amount to be shared with the Council.
The 36 private flats were marketed following the huge increase in house prices that we have seen in London. The results are in the Land Registry and total over £20 million. The figures for the rest of the development – the 19 “ghost” affordable flats bought by One Housing Group, the medical centre and the freehold are also known. We also know, from wording in the sale agreement for the land, the terms of the overage agreement and the expected sales, costs and thus profit from the development. What was not anticipated was that the contractor would be owned by the developer as has turned out to be the case but that is not something that invalidates an assessment of the true profit to be shared. The £3 to £4m quoted by Ms Whitby is based on these figures. It would be astonishing if, given the known sale prices of the private flats, there was no profit to be shared.
This Overage is payable by the current owners of the land Camden sold. During the time up to completion of the development, the developer (a subsidiary of Findon Urban Lofts Ltd) was the owner of the land. A year ago, Findon sold the freehold to a company in the British Virgin Islands whose ownership is therefore not readily known.
It may interest your readers to know how readily this sort of information is available. For ages, Camden refused requests from the public and press to provide any documents on the sale of the land. All that was known was that shortly after its sale for £651k, it was sold on, together with the derelict house next to the overground station for £3.5m. It was then found that the agreements for the sale of the land had been lodged at the land registry and for something under £20 all 50 odd pages were delivered to me in a couple of days. Freedom of Information requests for confirmation of the accuracy of the documents were submitted and, eventually, confirmed they were.
Information on the value of flats sold was obtained from HM Land Registry and the resulting schedule showing totals, buyers and so on were put onto the website www.talacefacts.org.uk. In spite of it all being public information, objection was taken by one or more of the buyers who persuaded the Land Registry to force me to remove the schedule from any website open to the public.
It is heartening to read in the same edition of the CNJ of there being more transparency on such matters now – and it is also my impression. Unfortunately, getting disclosure of the beneficial owners of companies registered in the British Virgin Islands is not something within any Council, let alone individual’s ability".
Yours truly
Alison
cfi. No idea how important this "Second Property Contract" point is. [email to Cllr Blackwell copied, is on Enq to Cllr Blackwell page]
Nick
Further to the email to Theo I forwarded earlier, I have since received this which is the belated response to Peter's FOI concerning responsibility for Overage. [See PC correspondence on Other FOIs sheet]
It looks as if they have made a meal out of saying that Hazlewood and no one else is the obligor and that any overage has been due for some time.
If that is the case, presumably the overage gets calculated probably by an "Expert". Hazlewood are invoiced. If they don't or can't pay, they get sued. On the plus side, presumably, is the fact that the land still exists. Camden would then be competing with Santander who will have a fixed charge but will it take precedence over Camden. I am gradually sinking out of my depth.
It is something that Camden is not responding that its all Commercially Confidential - which they probably would have if they hadn't experienced your doggedness. The advantage of mine to Theo is that is includes a likely ball park figure and rationale.
I am not certain that Camden are saying that all obligations were shed by Cornwall when it sold the freehold to Hazlewood. Also there is a familiar issue I had years back when I pointed out that the s106 obliged the parties to register it at the Land Registry and they had failed. Camden and I think Carter Ruck told me that the Land Registry didn't count for anything, only what is registered at the Town Hall.
One thing I learned from my discussion with Marshall is that an "expert"'s decision is much more valuable/less challengeable than that of an arbitrator.
I wonder if you have heard anything further?
Dear Alison
Herewith what I have just sent Theo. Hope it will do more good than harm. I am very conscious that almost the first thing you did when you became a Councillor was to alert Camden to the vanishing opportunity to get planning conditions fulfilled by refusing to sign off to the private flats being occupied - and the opportunity was wasted and look what happened.
[email referred to is on Enq to Cllr Blackwell page]
...... I had a very good 90 min discussion with Marshall Levine on the legal aspects of the Overage agreement in spite of a mix-up over dates.. meaning he hadn't read much of what I had sent him. He reinforced nearly everything that I believed to be the case. One thing that did occur to me after my discussion is that when the Camden officer said that the developer was in liquidation it may only partly have been a mistake as it is possible that Cornwall is in liquidation and being a BVI company that hasn't been known to me. However, it would make no difference as the Overage obligation lies with the freeholder, Hazlewood Properties Ltd, also a BVI company, to whom Cornwall sold the freehold a year ago.
Alison
I am seeing Marshall Levine of the Legal Cafe around 1pm tomorrow, probably in the Sir Richard Steele's in case you have any late information on the Overage question (or are free to drop in).
I wasn't sure from what you said whether you had put in the follow up questions I suggested? Or were only waiting for something more up to date on the reputed discussions referred to in Andy's email of nearly 4 months ago.
An oversimplified example of how the Overage terms should work, using imaginary figures could be -
Find the defined Sales, say, £25m and Costs £12m. Increase the Costs by 25% to make £15m. £25m - £15m gives the "Development Excess" of £10m which is then shared 30% ie £3m to Camden and 70% ie £7m remains with the developer.
I am awaiting a response on the Overage
A further email giving much more background and calculations was sent by NJH to AK and is on the Home page.
Email from NJH to AK following what he saw as a very inadequate response for Camden (Karen Swift), suggesting a follow up with suggested text.
Dear Alison
Re Karen Swift’s letter of 2.12.15 on responsibilities. You asked for separate member inquiries and what you sent was based on my suggested text which carefully separated Overage from Planning. However, the responses to those about responsibility have unfortunately been combined and Karen Swift rephrased what you asked by saying “Secondly with regard to your questions about who is responsible for fulfilling the planning obligations, including any overage due …”. Probably the officer(s) providing the reply were not lawyers and didn’t appreciate the difference between the Overage obligation and the s106 planning obligations. Alternatively, exactly the same party is responsible for both. I believe the parties are different but that it is for the legal and not the planning dept to be consulted. It would seem reasonable for a follow-up question to be put which should settle it – you may wish to omit the later bits-
“Your response concerning the obligation to pay Overage says that it is a planning obligation. Since planning obligations fall upon everyone with an interest in the land, including the private owners, could you confirm that they are potentially liable? I expected the obligation to be solely that of the freeholder but I am not a lawyer. As the private flats
were sold for more than £20m due to the exceptional increases in property values in 2013 and 2014, it should mean that at least £1m is due to Camden for overage so this is important”.
I think the answer is that the Overage obligation rests on the freeholder.
It was Cornwall but according to the Land Registry, Cornwall sold the freehold to
Hazlewood Properties Ltd, registering the sale in December 2014.
Hazlewood is registered in the British Virgin Islands and therefore we are not able to obtain details of its ownership. Thus, according to the Land Registry, Cornwall has not owned the site since last December unless Camden knows something that is not disclosed on the Land Registry. It looks as if Karen Swift is mistaken in saying in the 4th para of hers to you of 2.12.15 “… the current owner of the site, Cornwall Overseas Developments Limited, until it is sold”. I attach the land Registry extract up to date at 20.12.15. A follow up on this might be-
“With regard to your 4th para where you say that the current owner of the site is Cornwall, I am told that the Land Registry shows Cornwall as having sold the freehold to Hazlewood Properties Ltd, a BVI company, in December 2014. Could you advise therefore who is now responsible for Overage”.
Karen Swift’s letter seems to be saying that the Developer is Findon and that it is in liquidation. I think you told me on the telephone that you understood Citidwell to be in liquidation but I suspect you had misread her letter. The situation according to Companies House as of today (20.12.15) is that neither are in liquidation. Salient facts and their relevance are-
· Findon Urban Lofts Ltd are not and have never been recorded as being in liquidation. What they have done is to reduce their reserves to a nominal amount and on 29.1.14 issue a “solvency statement” referring to obligations in the next year. This provides evidence that they are preparing to go into liquidation and, of course, if they had substantial liabilities, the creditors would suffer. Their last set of accounts made no mention of any overage obligation.
· Citidwell are not and have never been recorded as being in liquidation. There previous name was Findon Property Services and they are almost certainly beneficially owned by Findon via a Cypriot company called Ralexo.
· There is, as far as I know, no obligation that legally rests on the “developer”. I don’t think it is a defined term anywhere. Key parties are the owner(s) of freeholds (probably for land sale obligations) and all who have an interest in the land ie freeholders, leaseholders, RSLs etc (for s106 obligations). In general, a developer is also the freeholder during the construction phase and until as freeholders, he has sold his flats etc. That all happened over a year ago. It must be rare for a public authority to find itself dealing with such complex ongoing obligations after the completion of construction.
One hopes that the legal department has a grip on this - Karen Swift refers to them as being involved in the collection of Overage but elsewhere it is just the planners - perhaps abetted by the traffic people..
Regards, Nick
Dear Councillor Kelly
I am writing with a combined response to the three enquiries that you have raised about the above housing development.
Firstly, [Related only to Affordable Flats but shown here as the response failed adequately to separate the four items and even said there were three] Firstly, with regard to the affordable flats on the development, officers in my team are aware of the delays there have been to residents being able to occupy these homes, and have sought regular updates from One Housing Group (OHG). While OHG took handover of the 19 affordable housing units twelve months ago, they were not satisfied with the standard of the homes and have issued contracts at their own expense to refit the units to a standard that is required for affordable housing. I understand that the Director of Development at OHG has written to you in detail about the extent of the works and is also meeting you on site on 10th December. The estimated completion of these works is February or March 2016.
Secondly, with regard to your questions about who is responsible for fulfilling the planning obligations, including any overage due, given that the developer has gone into liquidation, my team have consulted with planning colleagues for advice on these issues.
We are advised that any outstanding obligations remain with the current owner of the site, Cornwall Overseas Developments Limited, until it is sold. The Council liaises with Findon Urban Lofts (who we understand own Cornwall Overseas Developments Limited) and/or the managing agents, Citidwell. If the owner is in liquidation and Citidwell no longer manage the site, the Council would raise issues with the administrator or liquidator until it is sold, at which point the new owner would be responsible for the obligations. In addition, the Council holds a £1.1 million bond which it can utilise if necessary to ensure fulfilment of some of the obligations.
Planning colleagues are seeking further legal advice about recovery of the overage provision and are therefore not yet able to give a detailed response on this issue, but will endeavour to do so as soon as possible.
I trust that this letter clarifies the current situation but please do let me know if I can be of further assistance.
Yours sincerely, Karen Swift
Head of Supply, Initiatives and Partnerships Needs and Resources
4 numbered paragraphs of which 3 and 4 related to Overage and other obligations-
1. Affordable flats: What is happening about the affordable flats? Why have they not yet been occupied? It is nearly 18 months we have been waiting. What pressure are we putting on OHG so that local families can have a decent home?
2. Traffic audit: What is the situation about the traffic audit which was planned for November?
3. Overage: I understand the date on which Overage was to be calculated was many months ago and the developer has been maintaining that there was no profit to be shared. What is the situation and who will be responsible for Overage now there is, I am told, no longer a designated developer?
4. Continuing obligations: Camden has always recognised Findon Urban Lofts Ltd as the party primarily responsible for fulfilling obligations relating to the land and planning permissions related to the Prince’s Park development. Who is now regarded as having those obligations? How will we ensure that responsibilities are being fulfilled now that Findon has substantially reduced its balance sheet, submitted a solvency statement and has made no mention of contingency liabilities in its latest filed accounts.
“Thank you for your enquiry regarding the overage payment at Dalby Street, which has been passed to Property Services to respond.
The current position is that discussions are in progress with the developer over the amount of overage payable and the amount has not been agreed. We are seeking detailed information to feed into the calculation in order to assess what amount is payable and at this stage are not in a position to advise on the likely final amount. The developer is contending there is no overage due and needs to provide further evidence to substantiate his case.
The overage sum will be payable 28 days after agreement or in the event of a dispute there is a process to refer the matter to an independent expert, however it is premature to consider a reference to an independent expert at this stage of the negotiation. I hope this answers your queries