[2025] UKUT 39 (LC)

Park Crescent was designed by John Nash and completed in 1820 as a terrace of grand houses, each sharing a solid party wall with its neighbours on either side. It suffered substantial bomb damage during the second world war and in the 1960s it was redeveloped as offices with a restored façade after the original design supported by new steel and concrete frames. The County Court was at the western end, incorporating No. 14 and its mews, and it was closed eleven years ago as Park Crescent was redeveloped and restored to residential use.

The freehold of Park Crescent is held by the Crown, which does not object to the acquisition of the right to manage. The freehold is subject to two separate headleases, one of which is held by the second appellant, PC Investments Ltd. Part of that title, comprising No.14 and the mews behind it, is subject to an underlease held by the first appellant, 14 Park Crescent Ltd.

The redevelopment of No.14 created six new apartments in the main building and a further three in the mews. Each of these apartments has been let on a new long lease. The mews and the main building are connected by internal corridors and staircases and jointly comprise the premises for which the right to manage is claimed.

No.14 lies between 12 Park Crescent on one side and 98 Portland Place on the other. The whole Crescent was redeveloped between 2012 and 2018 as one project, but in stages, so that No.12 was completed and occupied before work began on No.14. No.14 underwent almost total demolition except for the front façade and its 1960s steel and concrete frame which were retained. In the course of the work the original foundations of the party walls were excavated, and new deeper and more substantial foundations were inserted below them, in effect underpinning the party walls. A new basement level was added, and a new residential mews building was created in place of former mews offices.

A number of features of the building are relied on by the appellants in support of their case that No.14 is not a self-contained part of a building, either because it does not constitute a vertical division of the building or because it could not be redeveloped independently of the rest of the Crescent.

There are movement joints on the façade of No.14 which do not align with the party wall behind. The movement joints are located in the gaps between the steel frame which supports the façade of No.14 and the frames supporting the facades of the adjoining buildings. In that location the façade is supported by the party wall. It was the view of the appellant’s expert witness, Mr Ilsley, that if No.14 was to be removed in its entirety along the inside face of the party wall, the section of the front elevation in front of the party wall, up to the movement joint, would be unsupported and would collapse. There are similar movement joints in the vicinity of the party wall with 98 Portland Place and at the rear of the building.

Because the movement joints and the party wall do not align, Mr Bates KC also submitted that it is not possible to divide the Crescent vertically down the line of the movement joint and that any division which follows the party wall would leave an unsupported portion of the façade.

A vertical division along the line of the party wall would also encounter the new foundations, the whole of which are said by the appellants to “belong” to No.14 and to be part of the premises over which the right to manage is claimed. A vertical division of No.14 would therefore have to deviate around the foundations in order to include them in the managed premises. Additionally, the new foundations could not be removed as part of a redevelopment of No.14 without destabilising the party wall and causing it to collapse. The same is said to be true of the mews.

Despite the various points made about the structure of the building and the support which No.14 provides to and receives from its neighbours on either side, it was agreed by Mr Ilsley that, by using temporary supports and restraints it would be possible to redevelop No.14 without redeveloping its neighbours.

At the rear of No.14, where it abuts the rear of 98 Portland Place, a balcony on the neighbouring premises projects across a straight line drawn through the centre of the party wall separating the two buildings. This was said to prevent a vertical division of No.14 from its neighbour because it would create a “dog leg” rather than a perfectly straight line. At the front of the mews, a step, which is said to be part of the claim premises, projects beyond a vertical line drawn down the face of the building. This was said by the appellants to be critical to satisfying the vertical division requirement as a vertical line drawn through the step would leave part of the premises on the wrong side, while a line which followed the surface of the step would not be completely vertical.