England and Wales High Court (Chancery Division) Decisions

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

		Royal Courts of Justice Strand, London, WC2A 2LL
		21 July 2006

Mr Christopher Nugee QC:

Introduction

1. This is an assessment of damages pursuant to an Order of Lewison J following a trial on issues of causation and liability in 2005. In the action, the Claimant, Vision Golf Limited ("Vision Golf"), claimed damages for professional negligence against the Fourth Defendant, Weightmans, a firm of solicitors. By the time of the trial liability was admitted; Lewison J held that Weightmans were responsible for the loss of a valuable lease, and gave judgment for Vision Golf for damages to be assessed accordingly.
2. The background facts are to be found in the judgment of Lewison J dated 26 July 2005. As there recorded Vision Golf was formerly the leasehold owner of a golf course near Wakefield on which it ran a golf club called Lofthouse Hill Golf Club ("Lofthouse"). The land was owned by two different freeholders: George Armitage & Sons plc ("GA") owned the south and eastern part which lies alongside the A61 road ("the GA land"); the remainder of the land, which is a slightly larger parcel to the northwest but has no access to the road ("the TR land") was then jointly owned by T & R Developments Ltd and Messrs Barrs and Cowen. Vision Golf therefore entered into two separate leases, each dated 15 December 1994 and for a term of 50 years from 1 April 1993, one of the GA land ("the GA lease") and one of the TR land ("the TR lease").
3. The GA lease was forfeited by GA on 11 May 2000 by peaceable re-entry for non-payment of rent. Weightmans had then recently been instructed by Vision Golf. They should have applied promptly for relief from forfeiture on Vision Golf's behalf; and it was common ground before Lewison J that they were in breach of duty in not doing do, that they should have done so by the end of June 2000 at the latest, and that had they made such an application it would almost certainly have succeeded (see his judgment at paragraph 29). For the reasons he gave, Lewison J rejected the argument that Weightmans' admitted negligence had not caused the loss of the GA lease and held that Vision Golf was entitled to claim the value of the lease that had been lost.
4. Vision Golf has also lost the TR lease. Lewison J said that the facts surrounding this were obscure, but held that it was not lost as a result of Weightmans' negligence: see his judgment at paragraphs 46-50. He therefore held that Vision Golf was not entitled to claim for loss of the TR lease.
5. In the event the main, and almost the only, issue I have to decide is the value of the GA lease. It is common ground that this falls to be valued at the date at which it would otherwise have been recovered by Vision Golf, that is in June or July 2000 (the expert witnesses were agreed that there was no difference between these two, and I will assume the end of June 2000).
6. There are also some other items which have to be brought into account in the computation of loss. These are very nearly agreed, and are as follows:

i) Vision Golf has to give credit for what it would have cost it to obtain relief. This has been agreed in the sum of £48,491.87, made up of arrears of rent, interest and costs.

ii) Vision Golf is entitled to recover the costs it paid to Ingram Winter Green, a firm of solicitors that it instructed in November 2000 after losing confidence in Weightmans. This has been agreed in the sum of £9,621.

iii) There remains a sum of £1,000 in dispute which Vision Golf paid to Weightmans. Essentially the question is whether this money was wasted. I will deal with this minor point at the end of my judgment.

iv) It is also agreed that any award of damages should carry simple interest under section 35A of the Supreme Court Act 1981 at a rate of 6.25% per annum from 1 July 2000.

Facts

7. I heard evidence from Mr Ian Simpson FRICS on behalf of Vision Golf and Mr Richard Roe MRICS on behalf of Weightmans. They had rather different approaches to the valuation of the GA lease, but I need to say a bit more about the site and its history to explain the background to their valuations. I did not in the event hear any factual evidence so I have confined the following account to what is apparent from the judgment of Lewison J and the other material put before me.
8. The site was previously a disused colliery and brickfield. Vision Golf initially developed it in 1993 and 1994 by building a clubhouse, car park and 9-hole golf course. The clubhouse, car park and most of the 9 holes were on the GA land which as I have already indicated is next to the road. Lewison J recorded that the work was finished by the end of 1994 and cost about £400-500,000. A further 9 holes were constructed some time later – Mr Simpson says in his report that it was constructed in 1997 at a cost of £200,000 and ready for use in 1998. By the valuation date of June 2000, the site was therefore laid out as an 18-hole course. Of these 5 of the first 9 holes and parts of the other 4 are on the GA land; the rest of the course is on the TR land.
9. The moving spirit behind Vision Golf was Mr Richard Hall. In 1997 Mr Hall met a Mr Middleton and began negotiations to sell his shares to him. In anticipation of the share sale, Mr Hall in early 1998 allowed Mr Middleton and his sons to take over the running of the golf club, and thereafter they were in physical control of the club and the course.
10. By the summer of 1998 however Mr Hall had come to mistrust Mr Middleton; and he agreed to sell his shares in Vision Golf to a Mr Edwards instead. He and Mr Edwards then sought to recover possession of the club from Mr Middleton, but were advised that this could not be done until the two leases were registered at HM Land Registry, which did not take place until March 2000. On 9 May 2000 Mr Hall met Weightmans and instructed them that Vision Golf wished to recover possession from Mr Middleton.
11. According to Mr Hall's witness statement for the trial, he went to the clubhouse on 10 May 2000, regained possession from Mr Middleton and changed the locks. The police then appeared and he left. He returned the next day only to find that GA had forfeited the GA lease by peaceable re-entry for non-payment of rent: Mr Hall had expected Mr Middleton to pay the rent out of the income of the club, but it appears that he had not in fact done so.
12. Shortly after (on 19 May) Pinsent Curtis, GA's solicitors, were writing to Weightmans to the effect that they had granted a tenancy at will to a third party and had agreed terms for the grant of a lease to it. This lease, for a 50-year term, was in fact completed in favour of Lofthouse Hill Golf Ltd ("LHGL") on 7 June 2000 ("the 2000 lease"). LHGL was a company controlled by Mr Middleton which he had already used to acquire the freehold of the TR land as I explain below. There was some discussion before me (in particular in cross-examination of Mr Roe) what the effect of the 2000 lease would have been if relief had been granted to Vision Golf at the end of June 2000; but Mr Thomas Dumont, who appeared for Weightmans, agreed with Mr Romie Tager QC, who appeared with Mr Stuart Hornett for Vision Golf, that it would have continued to subsist as in effect a lease of the reversion so that Vision Golf would have found that its immediate landlord of the GA land was not GA but LHGL. I agree with both counsel that this is the correct analysis; this of course also means that if relief had been granted, the 2000 lease would not have given LHGL any right to retain possession as against Vision Golf (and the contrary was not suggested).
13. In the event of course Vision Golf did not apply for relief and so LHGL stayed in possession of the GA land under the 2000 lease. It would seem that it also subsequently bought in the freehold reversion of the GA land from GA. I do not think I in fact have any formal evidence of this transaction before me, but it was not disputed that LHGL acquired the reversion on 28 December 2001 for £450,000.
14. So much for the history of the GA land. The history of the TR land is not quite the same. As I have mentioned, Mr Middleton used LHGL to acquire the freehold of this land (in reversion on the TR lease); this was on 15 December 1998 and the price paid was £113,204 (again I have not seen the transfer but this is confirmed by an Inland Revenue form for stamp duty purposes which is in the bundle before me).
15. LHGL therefore became Vision Golf's landlord in respect of the TR land in 1998, although Mr Hall says that he knew nothing of it at the time. As Lewison J records, the TR lease was not however forfeited in May 2000: GA had no power to forfeit the lease and did not purport to do so, and Mr Middleton, or more accurately LHGL, did not purport to do so either. Mr Middleton later claimed in a statutory declaration dated 12 March 2002 that the TR lease "was effectively forfeited on 15 December 1998", but Lewison J dismissed this as apparently untrue: see at paragraph 46 of his judgment. I need not consider if this is a conclusion of fact technically binding on the parties as it was not suggested before me that there was anything in the assertion that the lease had been forfeited in 1998, and in any event I would have come to the same view in the light of the statutory declaration which itself exhibits a notice of re-entry dated 27 February 2001, over two years later. Mr Middleton did subsequently succeed in having the registration of the TR lease cancelled (in 2002) but it seems to me that there is no basis for assuming that the lease had been forfeited any earlier than the date of that notice.
16. It follows that as at the assumed date of relief at the end of June 2000, Vision Golf remained the lessee of the TR land under the TR lease. If relief had been granted Vision Golf would therefore have been entitled to leases of both parts of the land and prima facie entitled to regain possession of the whole. I will have to consider later what practical difficulties there might have been in doing so given Mr Middleton's de facto presence on the land.
17. Quite apart from this Mr Middleton's control of the club for over 2 years has another practical consequence which is that Vision Golf does not have any trading information for the club as at the assumed date of valuation in June 2000. This makes the valuation exercise a more difficult one, as I discuss further below.
18. I should briefly indicate the terms of the GA and TR leases. They are in similar form:

i) Under each lease the rent payable was initially a peppercorn (until 30 March 1995) and then a fixed rent for 3 years, being £10,442.50 per year under the GA lease and £15,250 per year under the TR lease.

ii) From 1 April 1998 there were upward-only 5 yearly rent reviews. On the first two reviews (in 1998 and 2003) the reviewed rent was to be the indexed rental, that is the previous rent increased in line with the increase in the Retail Prices Index. Thereafter the reviewed rent was to be the greater of the indexed rental and the current market rental.

iii) The leases contain a definition of current market rental that provides for this to be the open market rental of both the GA and TR land (disregarding improvements carried out by the tenant and so effectively a ground rent). Interpreted literally this would appear to mean that the lessee would pay the rent for both parcels under each lease, thereby paying double rent. This is a curiosity that was identified by Mr Simpson in his report but he did not attach any weight to it; he said he thought the intention was to avoid the lessee arguing that each parcel was of very limited value in the absence of the other, which might have been a point taken if each fell to be valued separately. He naturally accepted in cross-examination that if the interpretation of the lease were that the lessee would have to pay double rent (and it could not be rectified) this would have a depressing effect on the value, but he was not asked to put a figure on this; and in re-examination he said that if acting for the landlord he would not even have argued for a double rent. The point was left there; Mr Roe did not refer to it; and I was neither asked to construe the lease nor shown any material on which to assess whether it could have been rectified. I can see the good sense of Mr Simpson's view of the parties' intentions and in the absence of any evidence from either valuer quantifying what effect this might have had on value I do not think I can or should speculate any further on the possible effect.

iv) Each lease contained a fairly standard set of tenant's covenants including covenants to repair and insure. The user covenant was to use as a golf course and clubhouse only. The covenant against assignment prevented assignment of one lease without the other, and each lease contained a covenant to comply with the covenants in the other lease.

v) The GA land is about 41.67 acres (16.86 hectares); the TR land about 54.68 acres (22.13 hectares).

Approach to valuation

19. I can now return to the different approaches adopted by the two valuers. Mr Simpson is a director of Savills (L&P) Ltd, has worked in the leisure department of Savills since 1990, and has been head of the leisure property team since January 2003. He says that a considerable proportion of his work involves the valuation of golf courses and his team undertook the valuation of 32 golf properties in 2005. His report explains that his approach to the valuation of the GA lease was as follows:

i) Golf courses are generally valued having regard to their trading potential so that when trading is mature the valuation method adopted is the profits method, which involves applying a multiplier to mature trading profits.

ii) Where trading has not reached maturity or trading information is not available it is theoretically possible to make an assessment as to the likely level of mature trading profit and calculate back to a current value taking into account the time, and any investment, needed to reach maturity and applying a suitable discount rate. However prospective purchasers may take very different views of these matters which can lead to a wide range in the calculated value, so this method is an unreliable guide to open market value.

iii) Mr Simpson therefore considers that a more reliable indication of open market value is by analysing comparable transactions. He has done this in two ways. First he has looked at comparables where what is sold is an 18-hole course to arrive at a value of the leasehold interest in Lofthouse as a whole; he has then apportioned this value between the GA land and the TR land. On this basis he valued the whole course at £575,000 of which he apportioned 67.5% to the GA land to produce a valuation of £385,000 for the GA lease.

iv) Second, he has looked at comparables where what is sold is a 9-hole course and derived from that a value for the GA land by itself, on the basis that a 9-hole course could be fitted onto that land alone. On this basis he has arrived at a value of £385,000 for the GA land. This however assumes a completed 9-hole course on the land; and a purchaser would need to make an allowance for the cost of altering the existing design (where some of the first 9 holes lie part on the GA and part on the TR land). Although he says he is unable accurately to assess the cost, if £50,000 were allowed it would bring his net value down to £335,000.

v) In doing this exercise he has assumed that vacant possession of the GA and TR land could be made available on the valuation date (subject to honouring playing rights granted to members by virtue of their annual subscription, but he has also assumed that an appropriate proportion of their subscriptions would be handed over to the purchaser). He has not made any discount to reflect the complete absence of trading information, nor any deduction to allow for potential breaches of covenant (in relation to tipping). He has allowed for the fact that all that is being valued is a leasehold not a freehold interest, but not made any further discount to reflect the fact that the length of term outstanding is only some 43 years as opposed to a longer term.

20. Mr Roe is an Equity Director of Eddisons Commercial. He has previous experience with Weatherall Green and Smith where he undertook numerous trading related valuations and PricewaterhouseCoopers where he was in the property team working alongside their Corporate Restructuring Team, principally dealing with troubled businesses; he was involved with numerous trading concerns including golf clubs. He did however have less experience of these than Mr Simpson: he had last been asked to value a golf course about 7 months before this hearing for a potential purchaser, and before that about 4 or 5 years ago for a firm of accountants. His approach to the valuation of the GA land, as appears from his report, is as follows:

i) The normal method of assessing the value of the GA lease would be to assess the value of the business as a whole as a trading entity and then apportion the value between the two leases.

ii) But it is difficult to make an assessment of the business because of the lack of trading information, and although it may be possible in certain circumstances to try and reconstruct a hypothetical profit and loss account based on assumptions, Mr Roe considers this would be misleading.

iii) There were a number of other factors that would significantly impact on the marketability and value of the business (and hence of the GA lease). Specifically these were that the length of lease available (some 43 years) would be regarded by the market as an unacceptably short term; the business would be unlikely to appeal to the corporate market; Mr Middleton had been in occupation since early 1998 without terms being agreed and the existence of a tenant with no documentation and no accounting information would make a sale very difficult; there was a potential liability in terms of complying with both planning notices and fly tipping. (In his initial report he had added that there was an outstanding rent review as at 1 April 1998; but he accepted in the joint statement that a prospective purchaser could have calculated the rent payable which as I have said was merely a matter of applying the rise in RPI to the existing rental).

iv) In these circumstances it would be difficult in pure valuation terms to ascribe any value to the GA lease as at June 2000.

v) However Mr Roe said that his experience would suggest that it is sometimes possible to find a person who would acquire the lease for a nominal sum, which he thought best represented by a valuation range of between £50,000 to £100,000.

21. It can be seen that the two valuers agreed that the normal method of valuing a trading property of this type would be the profits basis (supplemented as they agreed in their joint statement by cross referencing to comparables where possible), and also agreed that this was not possible in the present case because of the lack of trading information. Each also agreed that it would be unsatisfactory to try and construct a hypothetical profit and loss account. But each drew radically different conclusions: Mr Roe concluded that the lease had no real value at all save what a purchaser might pay for it on a speculative basis; Mr Simpson that the best method of assessing its value was to seek to identify comparable courses and derive a value from them.
22. It seems to me that the first issue I have to decide is whether the lease had anything more than what Mr Roe calls a nominal value. This means examining the reasons Mr Roe gives for his opinion that a purchaser would not have been willing to pay more than a speculative price. I will leave on one side for the moment the lack of accounting information which as I have said is common ground, and consider first the other matters relied on by him.

Occupation of Mr Middleton

23. One of these was the presence on the land of Mr Middleton. In his report Mr Roe seems to have regarded Mr Middleton as if he was some sort of informal tenant, referring to him as having been in occupation without terms of occupation having been agreed, as a tenant with no documentation and as a third party operating the golf club without a regularised tenancy agreement. Under cross-examination by Mr Tager he said that he was given no instructions whether to value with vacant possession or not, his instructions being to value the lease on the basis of the facts and circumstances as they appeared to him from the documents he was provided with. He assumed that Mr Middleton had gone back into occupation of the GA land after the forfeiture; and that if relief had been granted Mr Middleton would have remained physically in occupation. When Mr Tager asked him what right he thought Mr Middleton would have to stay there, he said that because he had been there for a considerable period, he could have argued that he was there otherwise than as a trespasser. It became apparent however that it was not easy to see what right Mr Middleton could claim to stay on the land. Mr Roe accepted that he could not think of any argument that Mr Middleton could use to resist eviction other than by claiming a tenancy of some sort; and that there was no evidence that Mr Middleton had ever paid any rent. Mr Roe was at pains to point out that he was not assuming that Mr Middleton had any legal right to stay but that merely that he could, if determined to make a nuisance of himself, have sought to use arguments to that effect. This was echoed in closing submissions when Mr Dumont said that Mr Middleton could have raised arguments, perhaps of an estoppel nature, sufficient to resist an order for possession and obtain an interlocutory injunction and that this would cast a blot on the title sufficient to have an effect on purchasers.
24. I reject this argument. It seems to me that for the purposes of assessing damages I should not seek to reopen the facts as found by Lewison J in his judgment. At paragraph 6 of his judgment, he said that "Mr Hall allowed Mr Middleton to run the golf club on Vision Golf's behalf" and I consider I should therefore approach this question on the basis that Mr Middleton's occupation of the land was as manager on behalf of Vision Golf and not under any form of tenancy or proprietary interest at all. Certainly I have seen nothing to suggest that he had any legal right to resist an order for possession. Neither party had a good word to say for Mr Middleton, nor did Lewison J who found that an assertion he made (that he had bought the freehold of the TR land in ignorance of the TR lease) was plainly untrue; I am therefore quite willing to accept that he might well have proved difficult and obstructive, so that Vision Golf might have had to return to court after obtaining relief to enforce its right to possession of the land, and this might have taken a little time. I can also well see that if Vision Golf had sold the land with the position of Mr Middleton unresolved, this would have been likely to put off potential purchasers who would necessarily be buying litigation; as Mr Simpson said, if Vision Golf's possession were not secure, that would be a significant concern to a buyer.
25. But I do not think it follows that the amount of damages to which Vision Golf is entitled for loss of its lease is to be limited accordingly. What it lost was a lease which carried a legal right to vacant possession; and it seems to me that it is entitled to be compensated for the loss of a lease which carried that right, even if it would have taken a little while to enforce that right through the courts. I agree with Mr Tager that sooner or later the court would have made orders effective against Mr Middleton, or at any rate that I have no material on which to assume otherwise. In my judgment therefore Vision Golf is entitled to be compensated for the loss of a lease with vacant possession. As I have said I accept that if Vision Golf had attempted to market the lease before obtaining such possession in fact, this would have deterred purchasers but this seems to me to be an artificial way of looking at it. If Vision Golf had obtained relief, it would never actually have put the lease on the market with Mr Middleton still in occupation; it would have waited until it had got him off the land and had undisputed possession. Indeed there is no reason to think Vision Golf would have sold the land at all: so far as I can see it wanted to recover the land so that under Mr Edwards' ownership it could run the golf club, not sell it. It should not be forgotten that the exercise that the court is engaged on is not one of assessing as an end in itself what the lease would have fetched if sold on the day relief were granted. The court is assessing how to compensate Vision Golf for the loss of an asset which was lost as a result of Weightmans' negligence. The valuation exercise which the experts have been asked to undertake is a very helpful, indeed essential, tool to enable the court to put a monetary value on that which has been lost; but where what was lost was a valuable lease with a right to vacant possession of the land, I decline to hold that the damages payable for loss of that lease should be assessed by reference to the fact that on the day on which it was lost, its market value would have been depressed by a temporary difficulty which could in due course have been cleared up. To do this would in my judgment fail adequately to compensate Vision Golf. I therefore reject the submission that I should assess damages by reference to the value of a lease subject to the de facto occupation of Mr Middleton; I propose to assess them by reference to the value of a lease with vacant possession.
26. Mr Dumont in submissions also referred to the fact that Vision Golf would have found itself with Mr Middleton's company, LHGL, as landlord both of the GA land and the TR land and that this would be an unattractive feature as he could make life difficult for the tenant. But quite apart from the fact that the landlord's scope for interference with the running of the club would seem to have been quite limited, the difficulty with this submission is that neither valuer referred to it at all. I therefore have no material on which to assess whether it would have had any, and if so what, impact on value. I therefore propose to ignore this feature.

Length of term

27. The next feature of the lease which Mr Roe relied on was the fact that it only had some 43 years left to run at the valuation date, being granted for 50 years from 1 April 1993 and therefore expiring on 31 March 2043. He said that this would be considered by the market as an unacceptable term on which to develop and invest in a golf course and most purchasers would therefore seek to acquire the freehold interests in both leases before proceeding. Mr Simpson agreed that purchasers of golf clubs such as Lofthouse invariably prefer to acquire the freehold, and I have no difficulty in accepting this. Mr Simpson also agrees that purchasers will pay less for a long lease than for the freehold, and again I accept this which is common ground. Where the two experts differ however is that Mr Simpson says that although a longer lease length, in excess of 50 years, would be preferable, the remaining term of 42 years and 10 months is sufficiently long not to give rise to a further significant discount when compared to longer leases of up to 99 years; the diminishing of the term does not have a significant effect on value until leases fall below 20-30 years in length. He stuck to this point under cross-examination and said that although a 43 year term is not as attractive as a 99 year term, the shortness of the term only makes an identifiable difference to value when one gets below 30 years and one cannot value with accuracy the difference between a 43 year and a 99 year lease. Mr Roe on the other hand contended that the circumstances at Lofthouse Hill were such that any purchaser would want to have the freehold to recover his capital investment, and instanced the fact that Mr Middleton did acquire the freehold reversion to both leases through LHGL, paying £450,000 for the freehold of the GA land.
28. This last transaction however was one that neither expert could understand. At the time LHGL acquired it, it was already the lessee of the GA land under the 2000 lease. Under that lease it was paying a rent of £13,500 per year, with 5 yearly rent reviews (the first being an indexed rent and the others the higher of an indexed rent and open market rental), and on a conventional basis of valuing the reversion by multiplying the rent, neither valuer could see that it made sense to pay anything like £450,000. I do not think I can safely draw any firm conclusions from this unexplained transaction, save that Mr Middleton thought for reasons of his own which I do not know that it was worth paying that much money.
29. I am left with having to choose between Mr Simpson's view that a leasehold interest of 43 years would have substantial value and Mr Roe's view that it would be so unattractive to the market that it would be one of the factors leading to no-one offering more than a nominal price. On this I prefer Mr Simpson's evidence; he has more relevant experience and I found him a more impressive witness. I was also not persuaded by Mr Roe that a purchaser buying and investing in a golf course would regard a period of 40 years as too short to recover the value of his investment. This seems contrary to what one would expect.

Potential market

30. Mr Roe's next point is that the business would not appeal to the corporate market, which would restrict the number of potential purchasers. I accept this: it was common ground that Lofthouse was at the lower end of the market. Mr Simpson described it as in the lower quartile; Mr Roe was more disparaging, describing it as probably one of the worst in the area. But although I accept that this would mean the course would only appeal to some potential purchasers, Mr Roe did not go so far as to suggest that this by itself would mean that it had no significant value at all.

Tipping

31. Mr Roe's next point was that purchasers would be put off because of tipping that had taken place. This wraps up various points: one is whether the purchaser would be at risk because tipping had taken place in breach of covenant, or breach of planning control; and the other is whether there was any risk of contamination of the land. So far as the latter point is concerned, the site was a former colliery and had been granted licences for use as a landfill site in both 1983 and 1993. These licences permitted deposit of uncontaminated or inert material, but the fact that it had been used for landfill at all would increase the risk of contamination. A detailed environmental appraisal was undertaken by Grimleys in November 1997; this identified some isolated potential sources of contamination, and overall concluded that the risk of contamination was low to medium. It is clear that tipping continued after that date, which led to both Leeds City Council and Wakefield Metropolitan District Council writing to complain of the volume of tipping, culminating in a summons being issued by Wakefield MDC against LHGL in June 1999. (The golf course lies partly in the areas of both councils).
32. Mr Roe said that a purchaser (and anyone funding him) would in the light of this want to commission an up to date report. He could not say what such an investigation would have found, and accepted that there was nothing in the evidence he had seen that suggested there was a contamination problem. He agreed that he was not aware of any complaints after June 2000 from either the local authorities or the Environment Agency. He also said that he was not saying that the risk of contamination made the property unmarketable. Mr Simpson thought that if the local authorities had any concern that contaminated material had been tipped, they would have taken action. He agreed that some purchasers would want another report but did not think every purchaser would; some would be content with the Grimleys report and verbal inquiries of the local authorities.
33. I accept that some purchasers would be influenced by the history of tipping on the site, and wish to commission another report. I accept Mr Simpson's opinion that not all would; and I also accept that there is in fact no evidence that such a report would have revealed anything different from that in the Grimleys report of 1997.
34. So far as the risk of breach of covenant is concerned, it is not entirely clear from Mr Roe's evidence that this was something that he specifically had in mind, but I will assume it was. There had indeed been a dispute between GA and Vision Golf whether the tipping that had taken place was in breach of covenant, and GA had served a notice under section 146 of the Law of Property Act 1925 as long before as January 1999. This however seems to me to be irrelevant. I have to assess the value of the GA lease on the basis that Vision Golf could have obtained relief from forfeiture by the end of June 2000, and then had a lease to sell. It seems to me that any past breaches of covenant – if there had been any – could not have affected its value. Once the court had granted relief and GA had accepted the arrears of rent up to June 2000, I do not see how GA could then have forfeited relying on any breaches that took place before that date, and a purchaser would not I think be concerned with any past breaches of covenant.
35. So far as the risk of breach of planning control is concerned, I accept that a purchaser would naturally wish to make inquiries of the local authorities to ensure that there was no outstanding enforcement action. Mr Simpson, who did make such inquiries, said that Wakefield had confirmed that there was no such action taking place in 2000; Leeds was unable to confirm whether there was any, but there is no evidence before me to suggest that any further action was in fact taken. It seems to me in these circumstances that although purchasers would be cautious, they would be unlikely to consider the planning risk to be a significant deterrent. Indeed Mr Simpson explained that the ability to import inert material onto a site such as a golf course can be a source of significant additional income. But although he thought this could be a material factor in what a purchaser would have bid in 2000, he had ignored any additional value for this factor. Taking the evidence as a whole, I consider it the most appropriate approach not to either increase or decrease the value of the site by reference to the history of, and potential for, tipping.

Parallel assignment

36. Mr Roe also referred to one other unusual factor in the valuation of the GA lease and that is the covenant against assigning except together with the TR lease. In cross-examination he said that this meant that there was a technical argument that the GA lease on its own had no value. But he made it clear that his valuation of the GA lease as having a nominal value did not hinge on this parallel assignment point, and I deal with any impact that it does have below.

Lack of accounting information

37. That brings me back to the lack of accounting information. For the reasons that I have given I do not think the other matters that Mr Roe refers to, taken singly or together, justify assessing the value of the GA lease at a nominal value. Mr Roe said that the circumstances were very unusual in that Vision Golf, the putative vendor, had not been responsible for running the club for the previous 2 to 2½ years, there was no reliable membership information, and no reliable information as to turnover or profits. He accepted that a purchaser would form his own views of how many members the business could attract, taking into account the nature of the course, the playing conditions, the competition in the area and the like and making his own assessment. He said however that the lack of reliable evidence means that it would be pure conjecture what the course could achieve, and that this would lead to a nominal value.
38. Mr Simpson was cross-examined at some length on this point. He agreed that there was a lack of reliable evidence, and that this would not help. He said it would be very difficult to say how much money Lofthouse would be making in 2000/2001, and that to start making an arbitrary assessment of what this golf course was making was not very helpful. He had tried to assess the likely turnover (which he thought might have been in the region of £275,000 to £325,000), but only so as to put it into a category to enable him to choose comparables. He had not valued Lofthouse by reference to assumed profits; what he had done was to try and look for comparable businesses that were also in the lower quartile of the market and he had purposely chosen businesses that were not trading very well. He had then used the value of the comparables to form a judgment as to the value of Lofthouse.
39. It seems to me that the two valuers were engaged on a different exercise and that it is not surprising in those circumstances that they came up with different answers. Mr Roe asked himself the question what a purchaser would have paid if the property had been sold by Vision Golf in June 2000 in circumstances where Vision Golf had no information as to membership, turnover or profits. It is understandable that he concluded that this would have depressed the price, although I remain doubtful, having heard all the evidence, as to whether such a purchaser would really have been so unable to form a view as to the course's potential as to pay only the nominal figures he suggested. As Mr Tager said, the property would have been sold to the person who would be prepared to bid most, that is the person who was least cautious and most optimistic as to the course's potential. Be that as it may, Mr Simpson asked himself a different question, namely what the property was worth on the assumption that the business was comparable to the other businesses which he considered.
40. In my judgment Mr Simpson's approach is to be preferred in the circumstances of this case. As I have already said the assessment of what the property would have fetched if sold at the end of June 2000 is not an end in itself, but is a tool to enable the court to assess what compensation to award to Vision Golf by way of damages for the loss of its asset. I think it more consonant with this exercise to assume, in the absence of any other evidence, that the business would have been comparable to other similar businesses. This does not mean falling into the fallacy of thinking that the market would have made this assumption when assessing how much to pay for Lofthouse. It means that the court in doing its best to assess what it is that has been lost will make the assumption that the business was doing, or capable of doing, neither better nor worse than other comparable businesses, and will then assess what the value of that business would have been. This seems to me what Mr Simpson has done, and for the reasons I have given I prefer his approach to that of Mr Roe. To adopt Mr Roe's approach would in my judgment have run an unacceptable risk of undercompensating Vision Golf. As I have already said there is no reason to think that if it had obtained relief it would in fact have put the lease on the market immediately, or at all; indeed Mr Roe himself said that it would be incredibly unusual for someone to ask him to sell a business which it had not been operating for the past 2½ years and that his advice would have been to run the club and trade it again and come back in 2 to 3 years with trading information. What this shows to my mind is that to put the property on the market immediately without trading information would not be the most appropriate way to realise its real underlying value, and I do not consider that it would be the most appropriate way to assess damages for its loss either.

Part of 18-hole course or 9-hole course

41. There is one other issue of principle that I have to decide, and that is whether it is more appropriate to value the GA lease at an apportioned part of the value of the leasehold interests in the 18-hole course at Lofthouse, or in isolation as the value of the leasehold interest in the GA land alone. In my judgment the former is more appropriate. The analogy used by Mr Tager in argument was of a pair of Georgian silver candlesticks worth £15,000 as a pair but only £5,000 each. He said that if a defendant had negligently lost one of the candlesticks, the claimant who had previously owned a pair and was now left with one could claim £7,500, being half the value of the pair, and was not limited to a claim for £5,000, being the value of the one that had been lost. I agree; indeed there might be an argument that such a claimant could claim £10,000 on the basis that he had previously had a pair worth £15,000 and was reduced to a single one worth £5,000, but Mr Tager did not seek to go that far and I express no view as to whether that would be right. Mr Dumont said that the reality was that Vision Golf was already in the process of losing the TR land and that it started to lose the TR land in 1998 when Mr Middleton was let in. It seems to me however that as I have explained above Vision Golf was still the owner of the TR lease in 2000 and if relief had been granted in relation to the GA lease it would have regained not only the right to possession but in due course actual possession of the whole of the land from Mr Middleton. The fact that Mr Middleton was in fact later able to have the TR lease closed does not in my judgment affect this: reverting to the candlesticks analogy, the damages payable for the negligent loss of the first candlestick are not as a matter of principle affected if the other candlestick is subsequently stolen by someone else.
42. In my judgment therefore the value of the GA lease is to be assessed as an apportioned part of the value of the two leases together. It may be noted that Mr Roe himself said that the normal way to value the GA lease would be to make an assessment of the value of the business in its entirety and apportion the value between the two leases. Such an approach also in my view disposes of the parallel assignment point that troubled Mr Roe. If the hypothetical transaction is a sale of both leases together, it matters not that each lease contains a covenant against assignment without the other.

Value of whole

43. I turn to the value to be placed on the two leasehold interests together on the assumption that they are marketed with vacant possession and that the business was comparable to those identified by Mr Simpson. His assessment of value for the whole was £575,000. He based this on three comparables, the sale of a 100-year lease, with about 90 years remaining, of Seckford Golf Club in Woodbridge, Suffolk in February 2001 for £560,000; the sale of a 99-year lease, with about 93 years remaining, of Grassmoor Golf Centre in Chesterfield, Derbyshire in August 1998 for £500,000; and the sale of the freehold of Austerbridge Golf Club near Doncaster in mid 2000 for £870,000.
44. Because of the way in which Mr Roe approached his valuation, I do not have any similar valuation of the whole from him, nor any analysis of Mr Simpson's comparables or the values to be derived from them. This means that the only evidence I have for this exercise is Mr Simpson's report and his evidence in cross-examination and re-examination. Mr Tager said that I had to act on evidence and that where only one expert had given evidence in relation to the comparables I had to accept his evidence, and cautioned me against acting as a quasi-expert drawing on my own experience. I do not accept the whole of this submission. It is of course the case that a judge has to act on evidence, but it seems to me that even where there is only one expert giving evidence on a particular aspect of the case, a judge is entitled, and indeed probably obliged, to examine that evidence critically with a view to deciding whether to accept it in its entirety. I accept that a judge should not start acting as a quasi-expert himself, but I do not accept that he has blindly to adopt the conclusions of an expert witness without considering the totality of the evidence for himself and forming his own view based on that evidence.
45. As I have said Mr Simpson relied on three comparables:

i) Seckford

Mr Simpson thought Seckford was quite a close comparable. It had some advantages over Lofthouse: it had some nice features such as mature trees, was in an area that was slightly more affluent and charged slightly higher fees, and its turnover was at the upper end of that he had assumed for Lofthouse. The sale was some 6 months later than the assumed valuation date for Lofthouse, and in general golf courses follow the trend in the general market and it is reasonable to allow for some improvement in values; the lease term was longer, which was as I have already said in Mr Simpson's view more attractive but did not have a significant effect on value.

On the other hand, it was one of the poorest golf courses in the area; it was a smaller land area with a shorter course and a smaller clubhouse. Overall he thought on balance someone would pay more for Lofthouse but if he were asked which he himself would buy, he would conclude there was not much in it and would probably choose Seckford.

In my judgment these features overall do not suggest any significant difference in value between the two courses and by itself this comparable would therefore support a value of £560,000 for Lofthouse.

ii) Grassmoor

Mr Simpson said that this was one of the best examples of a comparable that could be used. It was sold by a receiver for £500,000 in 1998; but this was 2 years before the valuation date and he thought the market had moved a bit (but not enough to construct an index). More significantly, his firm (who acted for the purchaser) had valued it in June 2000 at £625,000. This reflected extensive further investment in the business and significant improvement in the turnover (from £170,000 at the time of sale to £350,000). Compared to Lofthouse it had a shorter course, but the clubhouse although similar in size was of better quality, as was the driving range; it also had a modern greenkeeper's building which Lofthouse did not.

Mr Simpson said that he thought Lofthouse was not as poor as Grassmoor when it went into receivership, but not as good as Grassmoor once improved. He thought it supported a value of between £575,000 to £600,000 for Lofthouse, assuming that it had been maintained to an average standard. Bearing in mind the various respects in which Grassmoor (once improved) was better than Lofthouse, and the fact that the figure of £625,000 was a valuation not a market transaction, this seems a little bit generous. But I accept that it supports a value between £500,000 and £625,000 and probably somewhere in the middle of that range.

iii) Austerfield

Austerfield was another sale by a receiver. The freehold sold for £870,000 but Mr Simpson thought that if not sold by a receiver it might have sold for £900,000. To derive a value for a leasehold interest requires allocating some of this value to the reversion: the figure Mr Simpson adopted was £345,000. Deducting this from £870,000 would leave £525,000 for a leasehold interest (or £555,000 if one assumes £900,000 for the whole).

Mr Simpson however thought a leasehold could have fetched in excess of £600,000. The reasoning behind this is not clear from the analysis in his report, but in cross-examination he explained that there were more people with £600,000 to pay for a leasehold than £900,000 for a freehold.

Compared with Lofthouse, Austerfield is a much larger area of land (but in a poorer location) and has a larger clubhouse. Mr Simpson also accepted that it is a more attractive golf course, although he said only slightly. It also had a better turnover (at £367,700) than he assumed for Lofthouse.

Mr Simpson thought overall it supported a value of £550,000 to £575,000 for Lofthouse. Again this seems to me slightly on the high side taking account of all the evidence, and in cross-examination Mr Simpson said that to assume it only supported a value of £525,000 would not be consistent with the other two comparables. This may be right but I am doubtful whether Austerfield taken by itself supports as much as £575,000.

46. In the circumstances although I accept the general tenor of Mr Simpson's evidence, I consider that some of the points put to him in cross-examination had some merit and that his valuation was marginally on the high side. I therefore propose to adopt a value for the leasehold interests in Lofthouse as a whole of £550,000.

Apportionment

47. The next question is how much of this value should be apportioned to the GA lease. I can take this much more shortly. Again Mr Roe did not address this point. Mr Simpson did, and suggested 67.5% of the whole. He accepted that there was no particular science to this but drew on his experience. It was suggested to him that where two owners pooled their assets a common apportionment was 50/50; and Mr Dumont pointed to the rent review provisions in the 2000 lease which gave GA half the rental value of the combined site. But Mr Simpson said that the GA land had the assets, the clubhouse, car park and the access; and if he were asked which part he wanted it would not be the TR land. I accept this evidence and propose to adopt the percentage suggested by Mr Simpson. I will therefore assess the damages for the loss of the GA lease as 67.5% x £550,000, which I make £371,250.
48. I do not need in the circumstances to consider the evidence as to the value of the GA land viewed in isolation as a 9-hole course. At one stage Mr Dumont relied on the fact that the 2000 lease was granted at a premium of only £9,000 as evidence of value of a lease of the GA land but I agree with Mr Tager that this is no safe guide to the value of the GA lease as at the stage at which it was granted there was a very real risk of relief being given to Vision Golf. The 2000 lease therefore did not carry a certain right to possession, and LHGL could very well have found itself for the next 43 years in the position of a mesne landlord receiving rent from Vision Golf but having to pay rent to GA. This would be likely to have left it out of pocket given the difference in the rents, and a reversion in 43 years' time would be unlikely to have much value.

£1,000

49. That leaves the question of the £1,000. The facts are that Vision Golf transferred £44,000 to Weightmans' client account on 19 May 2000. By 27 November 2000 £43,000 of this had been retransferred, leaving a credit balance on client account of £1,000. Mr Dumont said that I could not conclude that this sum was repayable as it might be subject to a lien for work done; he relied on the fact that no complaint was made of the initial advice. He also said that it was inappropriate to claim this sum by way of damages. It seems to me however that Mr Tager is right in saying that even if the initial advice was impeccable, it was of no value to Vision Golf as it was not followed up as it should have been. It was therefore money that was wasted as a result of Weightmans' negligence, and I have no hesitation in deciding that Vision Golf are entitled to be repaid the £1,000.
50. The suggestion that this sum is not recoverable by way of damages is a more intricate point. I can see that it might have been simpler for Vision Golf to claim it on the basis that it was money held on client account for which Weightmans had neither accounted nor had any authority to transfer to themselves (no bill has been delivered for any of their services) and that it therefore remained Vision Golf's money and could be recovered as money had and received. But I would be very reluctant to send the parties away when all the relevant facts are before me and the sum involved is so small, and I think it is possible for me to award this as damages in the following way. By claiming it as damages, Vision Golf must be treated as giving up any claim that it remains entitled to the money. Weightmans are therefore entitled to take the £1,000 off client account on the basis that it represents payment for advice given; but Vision Golf as I have said is entitled to say that such advice was of no use to them because of Weightmans' subsequent negligence and therefore that the £1,000 was wasted and is recoverable by way of damages for negligence. This is a slightly tortuous way of getting to what I regard as plainly the right result; the alternative would be to give permission to Vision Golf to amend to claim it as money had and received, which I would readily give even at this late stage. I do not think it makes any difference to Vision Golf how it is done, but I can see that it might make a difference to Weightmans' internal accounting, and I will hear from Mr Dumont whether he has any preference as to how it is dealt with. One way or another however I propose to award £1,000 to Vision Golf.

Conclusion

51. I will therefore assess the amounts payable as follows:

Value of GA lease £371,250.00

Ingram Winter Green costs £ 9,621.00

£380,871.00

Less arrears, interest and costs £ 48,491.87

£332,379.13

Add £ 1,000.00

Total £333,379.13

52. In accordance with the parties' agreement I will also award simple interest on that sum under section 35A of the Supreme Court Act 1981 at 6.25% per annum from 1 July 2000. By my calculation interest at this rate for 6 years and 20 days amounts to £126,158.87, but I will leave it to counsel to check the figures.
53. It only remains for me to thank both counsel for their helpful submissions.