Buyers commonly rely on local searches, and on enquiries of highway authorities, before deciding whether or not to buy property. It is often important to know whether land forms part of the highway or not and, if the replies given are inaccurate, this may have serious implications for the buyer.
Chesterton Commercial (Oxon) Ltd v Oxfordshire County Council [2015] EWHC 2020 (Ch); [2015] PLSCS 228 concerned a family run property development company that acquired three properties in Henley-on-Thames for £1,245,000. The registered title included land fronting the properties comprising a footway, a driveway, car parking spaces and a triangular area of land containing five trees.
The results of the company’s local search indicated that the land at the front of the properties did not form part of the public highway. This was important because there was a shortage of car parking in the town and the inclusion of the parking spaces increased the price paid for the properties. Unfortunately, it subsequently emerged that the local search was incorrect. There had once been a turnpike road, which ran along the frontage of the properties and, although the road had been diverted in the early 1800s, the old highway had never been legally stopped up.
It transpired that the status of the land had been under investigation for some time – and the judge found that the council had known that there was a real risk that its records might be inaccurate. Indeed, there was strong evidence that the frontage might form part of the public highway. However, the council made no mention of this when it replied to the company’s local search.
The council eventually concluded that the frontage was, and always had been, part of the highway, which prevented the company from selling the parking spaces to anyone else. Consequently, it claimed damages in the sum of £400,000, to reflect the reduction in the value of the land that it had acquired, together with a further £150,000, which had been spent in an unsuccessful attempt to obtain a stopping up order to remedy the situation.
The council tried to persuade the judge that the results of the local search were an accurate reflection of the position, as shown on the highway map at the time. However, the judge noted that section 36(6) of the Highways Act 1980 places councils under an obligation to keep a “corrected up to date” list of the streets within their area that are maintainable at public expense and ruled that, if the council’s list had been correct and up to date, it would have shown that there was an investigation going on.
The council owed the company a duty of care at common law to answer the enquiries in its local search accurately – and had negligently stated unequivocally that the frontage was not highway maintainable at public expense, when it should have said that the matter was under investigation.
Allyson Colby is a property law consultant
