ABSTRACT
In giving advice to their elected members, developers and members of the public, officers must act both fairly and with a duty of care. Recent cases have highlighted these requirements.
The first such case was Slough Estates plc v Welwyn and Hatfield District Council (1996) EGCS 132. The allegation, which was upheld by the court, was that the council’s officers and members had deliberately deceived the plaintiffs and induced them to embark upon a retail development scheme which incurred significant losses. The court initially awarded the company damages amounting to £48 million, which later resulted in a negotiated settlement of £29.5 million. Slough Estates commenced building a retailing complex known as the Howard Centre in 1989, which opened in August 1991, and which incorporated part of the railway station at Welwyn Garden City. Prior to the commencement of development, Slough Estates Centre learned in 1984 of the council’s intention to build a second retail complex called the ‘A1 Galleria’ one mile from their complex. The council, as head leaseholder, had a financial interest in the second scheme, and was proposing to enter into a development agreement which would provide 200,000 square feet of retail floorspace. Slough Estates were concerned that the area could not sustain two such large retail developments in such close proximity. To overcome any potential problems, and to encourage Slough Estates to proceed with their development proposal, the council undertook to include, and to enforce, a Tenant Mix Agreement (TMA) with Carrolls, who were the developers of ‘A1 Galleria’, which opened in November 1991. This was designed to cover a five year period and would limit the occupation of the scheme to ‘leisure occupants’ and not allow traditional ‘high street’ shops which would be in competition with those established in the Howard Centre. Such an agreement was entered into, but subsequently there was a secret agreement with Carrolls to relax the terms of the agreement without the knowledge of Slough Estates.
