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By Luke Morgan, Supervising Director, Palmers Solicitors

The move towards alternative dispute resolution (ADR) as a priority for the Courts is undeniable – now acting as the expected first resort in the majority of cases.

This is perhaps best illustrated by a recently reported case from Nuneaton County Court towards the start of June. The defendants, spouses embroiled in a property dispute with a family member, although successful in their initial claim, were not allowed to fully reclaim their costs due to their “unreasonable” unwillingness to engage in mediation.

The sitting Judge, His Honour Judge Mithani KC, applied 25 per cent penalty to the total costs the defendants could reclaim – citing an “out of hand” rejection of repeated offers of mediation.

Three offers of mediation were made in total, throughout the course of the matter. One was ignored and two subsequent offers were dismissed as fruitless and unsuitable for the nature of the dispute.

There have been numerous arguments over whether this ruling was fair or not, but that isn’t the only point to be drawn from this outcome.

Mediating disputes

This outcome illustrates that court proceedings are becoming a secondary option for resolving disputes, a culmination of a long-running trend towards the primacy of ADR.

As someone who has been in the mediation field for many years, the advantages of this are clear, for both the court system and individuals.

The major benefit of relying on ADR over litigation in the first instance is encouraging constructive discussion which aims to quickly reach a mutually satisfactory conclusion while preserving relationships, which often isn’t possible with litigation.

Additionally, we know that court proceedings can be costly for the defendant, the claimant and the courts themselves, meaning it is in all parties’ financial interests to avoid litigation where possible – keeping ‘possible’ as the operative word.

Opposition to mediation

Mediation has its fair share of opponents. As argument in the above case, Conway V Conway & Anor, mediation isn’t always suitable to resolve a matter.

In some cases, it is obvious even to those involved that mediation is unlikely to reach a constructive solution, in which case it will be perceived as wasted time.

While this is an understandable sentiment, the purpose of mediation is to help disputing parties reach an accord, and mediators are trained to support difficult working relationships.

Furthermore, there is the perception that the requirement for mediation is denying claimants access to the court system and the powers of litigation. To this, I would assure all parties that mediation being a substitute for litigation is, in many cases, a positive and constructive move.

The court system is still in place for those cases that need it – mediation only serves to take the pressure of it and preserve relationships where possible.

To discuss mediation and how it can help you, please get in touch with me at LukeMorgan@palmerslaw.co.uk.

By Erin Cronin and Nicola Tubbs, Supervising Directors, Palmers Solicitors

Prior to the dissolution of Parliament on 24 May 2024, the long-awaited Leasehold and Freehold Reform Bill passed into law, receiving Royal Assent and delivering a number of new and strengthened rights to homeowners.

While this is undoubtedly welcome news for homeowners, the Act is markedly different from the one that was first proposed, with some key elements scrapped late in the day.

Additionally, the latest Government guidance suggests that the reforms will not come into effect until 2025 or 2026, with secondary legislation still needing to be fleshed out.

We are therefore seeing a lot of uncertainty around the Act as it moves quickly into law and expected issues have not been addressed – including the proposed changes to the Law and Property Act (LPA) 1925 as introduced in Clause 59(2) of the Bill to put an end to the exercise of Section 121 LPA 1925 remedies if the rent charge is “regulated” or income-only.

Leasehold homes

The headline move in the Act was to ban the sale of new leasehold houses, a measure backed by campaigners and consumer rights groups in a bid to end high service charges and ground rents for leasehold homeowners.

However, we saw a steep decline in the number of leasehold houses sold in the UK before the introduction of the Act, and the vast majority of leasehold properties now on the market are flats and apartments.

Despite initial proposals to the contrary, the Act does not ban the sale of new leasehold flats and therefore does not fully tackle a major issue facing those on the property market.

Lease extensions

The other critical aim of the Act is to make it easier, cheaper and more accessible for homeowners to buy a freehold or extend a lease.

In this regard, the Act has been more successful than it has been in eliminating the sale of new leasehold properties.

New leaseholders no longer need to own their home for two years or more before they can apply to extend a lease or buy a freehold.

Additionally, the standard term for leasehold houses and flats will also be extended to 990 years, up from 50 years for houses and 90 years for flats. Reflecting the growing need for security among leasehold homeowners, this substantial increase aims to remove the need for continued lease renewal and the costs that come with it.

Cost is a major concern among leasehold homeowners, so this is a welcome step forward for many leaseholders while still supporting the rights of freeholders where necessary.

Service charges and rent

Service charges remain an intense battleground for proponents and opponents of leasehold reform. We have seen a number of cases receiving national publicity in the run-up to the calling of a General Election in which high service charges have prevented leaseholders from selling a property or properly managing the cost of living.

Service charge bills must be issued in a standard format with high levels of transparency to allow leaseholders to challenge unfair costs. The Act has also banned high building insurance commissions for freeholders and managing agents, replacing them with transparent handling fees.

It is also worth noting that one of the major elements of the proposed Bill which did not make it through Parliament before 24 May was the cap on ground rent at £250 for existing leaseholders.

This is not necessarily the situation that leaseholders and campaigners were hoping for, although the Act has still removed a number of costs which have previously prevented homeowners from exercising their rights and enjoying long-term security in their homes.

Challenging poor practice

Ultimately, the Act is aimed at enhancing the right of leaseholders and offering more security for homeowners. To that end, it has also made it easier and more cost-effective for leaseholders to challenge poor practices among freeholders and managing agents.

Leaseholders will no longer automatically be expected to pay freeholders’ legal costs when challenging unfair practices.

Removing a significant barrier to taking matters to Tribunal, the Act has gone a long way to achieving its goal of supporting the rights of leaseholders – although the version of the Act which was passed by Parliament may not have been what leaseholders were initially expecting.

We expect to see the Act evolve in practice over the coming years as it is implemented and enforced. We also look forward to examining how the residential housing landscape will change in the coming years as leasehold properties become a thing of the past for many.

For advice on leasehold properties and transactions, please contact our Residential Property team today.

By Jeremy Sirrell, Supervising Director, Palmers Solicitors

The future has arrived… well, almost.

In a landmark piece of legislation, on the 20 May 2024, the Automated Vehicles Act 2024 received Royal assent – bringing into law the long-awaited Act that gives authorisation to self-driving vehicles for road use.

The scope of the Act

It is an interesting Act, departing somewhat from the usual run of Parliamentary Legislation in that it seeks to set out a broad framework for the authorisation of and use on British roads of self-driving vehicles.

The vast majority of the Act is not aimed at drivers or those who will be using the self-driving vehicles as passengers, but rather at, what it terms, licenced operators.

These are bodies regulated by the statute and who are charged with a wide variety of responsibilities, required to meet a number of criteria to obtain such a licence.

The content of the Act

The Act starts off with briefly describing a self-driving vehicle, giving a definition, and then sets out a statement of safety principles.

It requires the Secretary of State to prepare a statement of principles that he proposes to apply in assessing whether a vehicle is, indeed, a self-driving vehicle or not.

The Secretary of State is then given the power to authorise a self-driving vehicle for use on the road.

Very little is actually devoted to the liability of any passenger within a self-driving vehicle. It appears the Act envisages a world where responsibility for accidents involving self-driving vehicles will devolve within the first instance on the operator of the self-driving vehicle.

That is to say, the body that has responsibility for the operation of the vehicle. Although this is not defined in the Act, it seems likely to be either a manufacturer or some secondary body who has taken over responsibility for operating the vehicle.

What next?

What is clear from the Act is that, for the first time, the definition of a self-driving vehicle is given, provisions for safety requirements are laid down (or at least provision for them are made for them to be laid down) and a general framework for the operation of such vehicles is put in place to enable self-driving cars to be used on British roads.

The earliest vehicles will not be likely to hit the roads before 2026 and, realistically speaking, it could be very much later.

This is because self-driving cars will only become a reality when the technology has advanced sufficiently for driverless vehicles to be used on ordinary British roads in ordinary road conditions reliably and safely so that they become a genuine alternative to driving one’s own car.

The reason this legislation is so important is because it effectively removes the principal obstacle standing in the way of the use of driverless cars on our roads assuming, of course, that the issue of sufficient artificial intelligence capacity is indeed finally conquered.

We will not see any driverless cars on the road before 2026 and very possibly much later than that but we have moved one step (and it is a very large step) towards seeing driverless cars on our roads to be used by ordinary consumers, drivers and passengers for the first time in history.

For further advice on road traffic law, please contact Jeremy Sirrell at JeremySirrell@palmerslaw.co.uk