Home Information Cases Slough Estates Plc v Welwyn Hatfield District Council (1996)

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Slough Estates Plc v Welwyn Hatfield District Council (1996)

Summary

Claim for misrepresentation which induced the three plaintiff companies to continue with the construction and maintenance of the Howard Shopping Centre.

Facts

Claim in deceit by the plaintiffs, against Welwyn Hatfield District Council (WHDC), 1st defendant for damages which began in the Crown Office as an application for judicial review in which plaintiffs and John Lewis Plc were successful before Kennedy J in March 1991. Howard Centre was built by the plaintiffs as a town centre shopping development with the main income producing space let as retail shops. In 1984 the plaintiffs learnt that WHDC were moving towards a development agreement with the Carroll Group which was to include 200,000 sq ft of lettable space at Park Plaza nearby. They perceived that as potentially unacceptable competition with their Howard Centre as the area could not sustain two large retail developments so close together. WHDC and Carroll told the plaintiffs that it was intended that Park Plaza should be what they called a speciality leisure-based development and they drafted a Tenant Mix Agreement (TMA) designed to limit for five years the classes of tenant at Park Plaza so as to reduce or eliminate competition with Howard Centre and other town centre traders. WHDC undertook to include the TMA in their development agreement with Carroll and to enforce it. The plaintiffs contended:- that WHDC represented to them that the TMA was in place and that it was WHDC's intention to enforce it; that they relied on these representations and that WHDC knew this; that they were induced to continue with their Howard Centre development in reliance on the representations and that they would not have done so if they had known that the TMA was not in place or that it would not be enforced; that notwithstanding the representations, WHDC knowingly and dishonestly made secret arrangements with Carroll to relax the TMA but at the same time pretended to the plaintiffs that the TMA was in place and was being enforced.

Held

In a 86 page judgment His Lordship concluded that Slough were induced by representations concerning TMA to continue with the Howard Centre and specifically were induced to commit themselves in September 1988 to its construction. Slough were entitled to #49,963,625 less sunk costs incurred before 22/4/87 between #1.5m and #2m which were yet to be calculated precisely on the basis of the date which the Court had now found from which all the necessary liability elements of the plaintiff's claim were established. Judgment for the plaintiffs.

Queen's Bench Division
May J
Judgment date
11 July 1996
References

LTL 15/7/96 : [1996] 2 PLR 50 : [1996] 2 EGLR 219 : [1996] EG 132 (CS) : [1996] NPC 118