Community Assets No 2 - Moratorium on a Disposal (Update No 2 - 23 November 2011)

The Localism Act 2011 requires an owner who has a property which is listed on the local authority's list of assets of community value to give notification of disposal. This will kick in an interim moritorium period of disposal, ie six weeks in which a community group may declare an interest in exercising their right to bid for the property. If one does so a full moratorium  period on the disposal arises, namel six months.

It follows that the stakeholders will all have to be alert to the impact of such a moratorium, namely:

• the owner should be aware that the property is on the list and be concerned that the appropriate "notification of disposal" (see section 96)  is made;
• any owner's estate agent should take into account the timing of the various periods given in the chapter, eg "full moratorium period", "interim moratorium period" and "protected period";
• prospective buyers (both community buyers or private buyers) will need to understand the nature and timings of any possible delays;
• any community interest group (see section 95(6)) wanting the property will need to comply with the procedures;
• the local authority (see section 106 (1), (2), (3), and (4))  will need to be geared up to give effect to the procedures.

Once the Regulations are published (probably in a few months) the full gamut of the legislation will begin to bear!


A point to bear in mind: where the vendor has a "going concern", eg as a branch in a bank and decides to close the bank branch, it may be difficult afterwards to maintain or claim the "community value" in the empty property. The issue is that the "community value" may lie in the continuation of the use, in this case banking: it is not in the property per se.