May 2009 - Time to snap up commercial property bargains


Business Law Update
May 2009

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from Cousins Business Law

Gary CousinsWelcome to the May issue of the Business Law Update from Cousins Business Law. This month there are some suggestions for anyone in the market to snap up a commercial property bargain and a warning for licensed premises owners that the Home Office’s new proposals could make business even tougher. With useful links to recent Cousins Business Law blog posts and a Which? Guide to tax for the self employed, we hope there’s something for everyone.

I hope you will find information relevant to your business in this month’s issue. We are keen to cover topics of concern to business people so, if you have questions or topics you would like us to cover, email your ideas to


Gary Cousins
0121 778 3212

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Time to snap up commercial property bargains

According to Schroders UK, commercial property is a ‘screaming buy’ at the moment. They have advised foreign investors to take advantage of both a commercial property market that has suffered a fall from its 2007 peak of some 40%, and a currency that many see as undervalued compared to both the Euro and the Dollar (at the time of writing Sterling is in the process of making something of a comeback against both currencies).

However, the Bank of England’s monthly summary of business conditions in the UK confirmed that the UK construction industry is still in a moribund state. The report confirmed that construction activity had continued contracting and in recent months, in addition to the already scant private sector contracts, there had been further reports that growth in public sector work was slowing, or that projects were being delayed.

Residential construction remains at very low levels and, looking forward, the Bank’s contacts did not expect any recovery in the coming months. There was an excess of retail and office space in many parts of the United Kingdom and the viability of prospective commercial property projects remained constrained by lower property valuations and the cost and availability of external finance.

The trick, of course, in any market is to anticipate the bottom. If you are looking for signs that we may be close to the bottom then you would be heartened by Cushman Wakefield’s Business Briefing which indicated that prime yields for UK property have stabilised in the last two months with 21 of its 24 key yield outlook indicators flat-lining between March and April.

Cash may be king but when the banks are being given the use of our cash for next to no return and are refusing to lend it back out the front door for anything other than bombproof investments then it’s time to withdraw our hard-earned and place it in the nation’s favourite substances – bricks and mortar.

So how best to take advantage of opportunities in commercial property? Buying at auction can be a sound policy provided you have undertaken a full due diligence exercise in advance. Commercial property lawyer Steve Petty of Cousins Business Law offers all clients no purchase no fee terms when buying at auction which means you don’t need to worry about a large legal bill for carrying out due diligence on a property you fail to acquire.

Properties occupied by blue chip companies with a number of years left on their lease are ideal buys but with the large house builders having largely withdrawn from the market, there are also opportunities to bid for sites with long-term development potential.

If you are looking to invest in commercial property then make sure you have the right professional team in place to move quickly if an opportunity arises. A surveyor with expert knowledge of the relevant geographical area and market sector is essential and if you need finance just any old broker won’t do these days. Cousins Business Law can introduce you to other professionals in whom we have confidence to ensure you end up with a peach rather than a lemon.

For help with any commercial property deal contact property lawyer, Steve Petty, on 01926 629005 or by email.

Legal Update

Storm warning for licensed premises

Not content that the smoking ban and credit crunch are having a significant impact already on the licensed trade, the Government seem determined to go back on their promise of a ‘light touch’ in dealing with the licensed trade. It seems the Home Office is taking over from the Department for Culture Media and Sport in regulating licensed premises. Its consultation on the code of practice for alcohol retailers entitled “Safe, Sensible, Social: Selling Alcohol Responsibly” has just been issued and it doesn’t bode well for anyone in the industry hoping for a freer rein and sensible regulations.

Instead, it seems the industry is to be tied up in a whole heap of new red tape in order to address a few problem licensed premises. This one size fits all approach which includes a series of mandatory and discretionary measures for off-licences, pubs and private clubs is not what the industry needs right now.

The consultation period lasts until 5th August 2009, so now would be a good time to review the proposals and lobby against them if you see fit. Full details of the conditions of the proposed code of practices can be found on our website in the article Storm warning for licensed premises.

For advice on licensing issues, contact Nigel Musgrove, licensing solicitor with Cousins Business Law, on 01285 847001.

Plain English Legal Advice

Five ways to resolve a construction dispute

There are 5 basic methods of resolving construction disputes, the most usual of which arise between a contractor and employer, or between a sub-contractor and main-contractor. A new article on the Cousins Business Law website, 5 Methods of resolving construction disputes, details the basic characteristics of each method, from the cheapest upwards and points out their main pros and cons.

Here’s a snapshot of the pluses and minuses in each case – read the full article or contact Cousins Business Law for more details

Contract Administrator - ask the Contract Administrator to make a decision.

Pros: quick and cheap.
Cons: may not be binding.

Negotiation - over the telephone, by correspondence, at a meeting or through mediation.

Pros: quick, cheap and parties in control of outcome.
Cons: unless parties have equal power, it may not be effective.

Adjudication - all parties to a construction contract have a statutory right to adjudication which can be commenced at any time and a decision within 28 days.

Pros: quick, relatively cheap and immediately enforceable.
Cons: rough and ready decision, and can be overturned in later proceedings.

Arbitration - much more like court proceedings than adjudication. Requires a genuine dispute and a binding agreement.

Pros: a thorough procedure although quicker than court, convenience, privacy, a binding decision, and parties can opt to choose an arbitrator with technical expertise in the issue to be decided.
Cons: expensive.

Litigation - where a dispute is referred to the courts for a decision.

Pros: a more thorough procedure, a binding decision, multiple parties can be joined in, best if there is a point of law to be decided, and often more decisive.
Cons: can be slower than other resolution methods, expensive.

No two disputes are the same and the decision as to what method should be adopted in a particular case should be decided in consultation with a dispute resolution solicitor who can advise what is best in your particular case.

Useful Links

CBL Blog Useful Source of Information

Learn more about why hot summer sun could be a nuisance for licensed premises owners and read the debate on when the recession will ease for SMEs in the Cousins Business Law blog. Add your comments to the debate now.

Business rate relief

If you own a small business which has a rateable value of below £15,000 a year (or less than £21,500 in Greater London) you could claim up to half of your business rates back. There’s more detail about the business rate relief scheme, including details about business rate exemptions on empty premises on the Business Link website.

Which? Guide to Tax for the Self Employed

The Which? website has a useful guide to tax for the self employed covering advice on how to work out whether you are self employed, particularly useful for contractors and guidance on what expenses are allowable and not as a business expense.

Litigation Madness

Noisy neighbours

After last month’s Litigation Madness story, it appears the courts still one thing on their minds.

At the end of April, Caroline Cartwright was imprisoned for “excessively noisy” activities in the bedroom. Following complaints from neighbours, the local authority installed recording equipment in her neighbour’s property to record her bedroom antics. On 17th April 2009, magistrates in Sunderland listened to what was described as “an excessive screaming female voice” on the tapes and decided to impose a 4-year ASBO on her, banning her from “making excessive noise” anywhere in England.

However, neighbours reported that, on the mornings of 18th April, 22nd April and 26th April, they had heard her shouting, moaning and groaning, and her bed banging against the wall. She was brought back to court at the end of April and remanded in custody pending trial by a judge and jury in the Crown Court.

While her neighbours (and presumably her husband) are catching up with their sleep, Mrs Cartwright has said, “I can't stop making noise … It's unnatural to not make any noises and I don't think that I am particularly loud.” Well, that will now be up to a jury to decide. As for her husband, he apparently makes far less sound!

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Cousins Business Law is a member of the Law Society & regulated by the Solicitors Regulation Authority. Head Office: Swan House PO Box 11543, Birmingham, B13 0ZL. Tel +44 (0)121 778 3212. Fax: +44(0)121 275 6155