AGENDA ITEM 14
BOROUGH OF POOLE
REPORT TO THE CABINET
DOLPHIN QUAYS: ALLEGED ENCROACHMENT
22 JULY 2004
PART OF THE PUBLISHED FORWARD PLAN: NO
STATUS: EXECUTIVE POLICY
1Purpose and Policy Context
1.1To update Members on the current position in relation to the outstanding claim by the Council for compensation in relation to alleged encroachments above and below the Council’s land adjoining Dolphin Quays, and to seek the agreement of Cabinet to refer the matter to Alternative Dispute Resolution.
2Recommendations
2.1Members note the current position.
2.2Members approve the referral of the matter for resolution to a mediator to be agreed by the Head of Legal Services and Head of Property Services in consultation with Counsel.
3Background
3.1On 27 January 2004 Members of the Cabinet were advised that there was an outstanding dispute between the Council and the Receiver for Poole Developments Limited and Dolphin Quays Developments Limited in relation to an alleged encroachment by the pile-caps of certain foundations of the development beneath the adjoining Council owned highway and of balconies and a walkway above the Council’s highway land. The District Valuer (Bristol) had been engaged to negotiate on the Council’s behalf, and Counsel had also been engaged to advise on the strength of the Council’s position and, on the Receiver’s part, legal and valuation advisers had similarly been instructed.
3.2At the time of the January report the positions of the Council and Receiver remained considerably at variance – the Receiver’s advisers did not accept that encroachment had taken place in law and believed that even if such encroachment had taken place, the Council could not in law now argue the point, and that even if they were to be proved wrong in these arguments, the appropriate consideration to the Council was nominal given that the Council is not prejudiced in any way as the encroachments do not impact on the use of the Councils land for it’s authorised purpose as public highway. The Council’s legal and valuation advisers in contrast believed that evidence of the encroachment was clear, the Council could enforce it’s right to be compensated for the encroachment, and that the sum properly due to the Council should be based on the development value of the area of land in question, - a substantial sum.
4Dispute Resolution options
4.1Correspondence and negotiation between the advisers of the Council and the Receiver since January has failed to narrow the gulf between the two parties in any significant regard, and it is now necessary to decide how the issue can be determined. The choice is between commencing litigation through the Courts or some form of alternative dispute resolution procedure –essentially mediation, arbitration or determination by an expert. The Civil Procedure Rules adopted following the Lord Woolf reforms impose upon Judges the responsibility of encouraging parties to use ADR by various means, including the possible imposition of a costs sanction on a party who failed to respond adequately to the overall objective of the Woolf reforms, that litigation should be a last resort and that discussion and negotiation (including in particular mediation) should be exhausted prior to court proceedings being instituted.
4.2The Receiver’s Solicitors and Counsel have now approached the Council seeking to find a way of bringing the matter to a head within a reasonable timescale and have specifically asked that agreement is reached to the appointment of a mediator and that a precise ADR process be negotiated between the two parties, together with an appropriate timescale for the various steps to be taken to place the relevant information before an agreed person. This suggestion has been put before Counsel instructed on behalf of the Council, and he does agree that ADR would be difficult to refuse, would leave the parties in greater control of the timetable than court litigation and he therefore concurs that this is the best route to follow.
4.3At the request of our Counsel, the legal advisers for the Receiver are now in the process of suggesting of names and qualifications of possible mediators able to deal with the issue for consideration, and the next step would be for the Council and it’s advisers to consider their suggestions and either approve one of the persons or suggest names of our own. Once the mediator has been agreed by both sides, the detailed procedure, terms of reference and list of issues to be put before the mediator would have to be agreed, and then documents and submissions forwarded to the mediator within a set time frame in preparation for the mediation/arbitration to take place. It is anticipated that by following this procedure, it should be possible to bring the issues before a mediator during the first half of September of this year.
4.4As in any form of legal or property dispute, the outcome can never be guaranteed. The legal and valuation advisers on both sides are confident of their diametrically opposed positions, but there is no definitive precedent for the situation the parties find themselves in, and the outcome will turn on whose interpretation of the relevant principles proves to be correct. There appears to be no chance of the parties and their adviser agreeing on this matter between themselves, and it is therefore necessary and right that the issues be placed before an third party so as to facilitate the closure of the dispute.
C H Eames
Head of Legal Services2 July 2004
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