Developer sues owners for incorrect information regarding service charge
Property developer Wildmoor Northpoint has launched a £1m legal battle in a row over the North Point Shopping Centre in Hull.
Wildmoor agreed to buy the shopping centre, which includes shops and a market, from owners Frogmore Property Co for £53m in June 2006, according to a High Court writ.
But now Wildmoor says that Frogmore gave incorrect answers to inquiries about the service charge, and that as a result the shopping centre is worth £1m less than it paid.
Wildmoor, of Fairfax House, Fulwood Place, London WC1, is suing Frogmore, of Wigmore Street, for damages for breach of warranties in the sale agreement, as well as all costs and expenses incurred as a result, the writ says.
Frogmore had produced a service charge budget saying that of the total service charge cost of £884,268.39, Frogmore was liable to meet the service charge for the market, of £54,992.73, as the market tenants did not contribute to the service charge, the writ claims.
The company’s answers to the service charge budget were incorrect, as there was also a market budget 2006, which showed extra charges of £54,154.29 which did not appear in the service charge budget.
An accurate reply to the inquiries would have referred to both budgets, and Frogmore breached its warranty through its omission, it is alleged.