Housebuilder Top Tip - March 2015 - DAC Beachcroft

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Housebuilder Top Tip - March 2015

Published 3 March 2015

Commuted sum payments under highway agreements are lawful so says the Court of Appeal.

Developers can be liable for the on-going and future highway maintenance work even after a road has been adopted and is "maintainable at the public expense" following a recent Court of Appeal decision. The Court decided in Redrow Homes v Knowsley Metropolitan Borough Council that Redrow was obliged to pay a commuted sum figure of £39,000 towards the future maintenance of street lighting after the adoption of an estate road.

Going forward, developers should begin negotiating highway agreements in the development process as soon as a detailed scheme is in place and pay close attention to what the relevant local authority policy is on highway maintenance. 

A more risk-averse developer might consider negotiating with the selling landowner to make a contract conditional on a "satisfactory" highways agreement being entered into, or to provide for a price adjustment post highways agreement being entered into to ensure the development remains commercially viable on the basis of any charges or maintenance obligations that may be imposed.

Authors

Gemma Leonard

Gemma Leonard

London - Fetter Lane

+44 (0)20 7894 6429

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