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Legal Considerations

Equal Opportunities

SCAA has an Employees Equal Opportunities Policy modelled on that of the National Archives and is committed to fairness and inclusivity. We recognise the changes that have been introduced by parts of the Equalities Act coming into force in October 2010 are recognised and the Governance Sub-Committee has been charged with reviewing our existing Employees Equal Opportunities Policy and are committed to implementing an appropriate Service Providers Equal Opportunities Policy by the next Board meeting on 25th October 2011.

Disability Discrimination Act

Though the site is Grade II listed and therefore largely exempt from the provisions of the act, SCAA would endeavour to provide a minimum of two suitable disabled toilets, appropriate signage in braille and install induction loops in the rehearsal rooms. SCAA would also commission Redcar and Cleveland Real Opportunity Centre to carry out an access audit of the building.

Privacy

As part of SCAA’s internal review prior to this submission it was identified that, although we an existing privacy policy was in place, which was in keeping with the spirit of the Data Protection Act, there was a requirement given the nature of information processed, in particular concerning The Works @ Marske Mill, to formally register with the Office of the Information Commissioner as a Data Controller. This application has now been submitted, with the Company Secretary, Janice Crombie, as the named contact.

SCAA complies with the Privacy and Electronic Communications Regulations by the use of a third party mailing service provider trading under the name MailChimp and owned by The Rocket Science Group LLC, a limited liability company organised and existing under the rules of the State of Georgia, USA. They are notified with the UK Information Commissioner’s Office as a Data Controller in accordance with their Privacy Policy and their Registration Number is Z1907965. They are also fully compliant with the EU Safeharbour Framework and fully compliant with the laws of the USA.

Insurance

SCAA has the following insurance policies in place:

Combined Commercial Insurance Policy, Brit Insurance Ltd, Policy No.: PB0116849C

  • Employers Liability: £10,000,000.00 per claim
  • Public Liability: £1,000,000.00 per claim
  • Products Liability: £1,000,000.00 in aggregate

It is recognised that the Public Liability element of this insurance policy should be raised to £10,000,000.00 per claim, in line with new models of best practice.

SCAA has consulted its insurance brokers, Teesside Insurance, who confirmed that it would be possible to extend this policy to include a second site at minimal cost.

Building Insurance, RCBC Block Leased Property Insurance Scheme

  • Please refer any queries to Sue Nicholson of RCBC on 01642 444 561.

SCAA recognises that it would need to take out an additional buildings insurance policy to cover the new site, which could presumably be done through the existing policy.

Trading

SCAA recognises that it may be necessary as The Works @ Marske Mill develops and joint turnover approaches the circa. £200,000 VAT charities exemption limit, to establish a trading company to handle the day-to-day commercial concerns of SCAA. Any such trading company would be constituted as a wholly owned subsidiary of SCAA and would be covenanted by its Memorandum and Articles of Association to return all net profit to SCAA.

Preferred Tenure

SCAA has carried out an extended discussion on the issue of tenure and has consulted both property and voluntary sector experts. From these discussions we have identified the following key requirements that the terms of tenure of any CAT would need to reflect:

  1. Permanent or long-term tenure;
    • Funding is often only available to projects where it is clear there is a long term future for any elements supported by the funding partner. This is particularly relevant to capital funding where funding partners expect the applicant to either be a freeholder or long-term leaseholder¶ of the property benefitting from the capital funding.
  2. The ability to sub-let or sub-lease part of the asset.
    • SCAA envisages leasing the Caretakers Cottage on the site to provide an initial revenue stream for The Works @ Marske Mill; maximum flexibility is required in arranging this lease to ensure its profitable contribution to the project.
    • There is a widely recognised need for basic hostel holiday accommodation for walkers of the Cleveland Way and cyclists of the Sustrans Cycle Route 1 who are passing through or visiting Saltburn. In consultation with experts in the hostel holiday industry we have concluded that this is a specialist service which requires a particular skill set, therefore it is SCAA’ preference to sub-lease or franchise the holiday hostel accommodation component of The Works @ Marske Mill.
    • Sufficient flexibility is also required to set up similar arrangements where other activities involve specialist skills and experience not readily available to the managers of the asset.

Notwithstanding the aforementioned, four types of tenure were considered for the CAT:

    1. Freehold at Fair Market Value

 

Positive Issues Negative Issues
Maximum freedom of action High risk: poor performance could lose asset
Credibility of new owners Delay incurred by long timescale required to raise funds
Purchase price used by RCBC to benefit local people Resources used on purchase rather than services
Ability to use asset as collateral Poor perception in local community regarding cost
Possibility for maximum community involvement Resources still needed for capital works
Further resources still needed
    1. Freehold at Nominal or No Cost

 

Positive Issues Negative Issues
Maximum freedom of action High risk: poor performance could lose asset
Available for capital needs and cash flow RCBC loses income
Ability to use asset as collateral Weakens accountability
Freedom to find creative solutions and initiatives Reduced RCBC commitment to support the project
Possibility for maximum community involvement
    1. Long Leasehold at Market Rent

 

Positive Issues Negative Issues
Customer rather than beneficiary Unable to use the asset as collateral
Reduced risk of asset being lost Income used to pay rent rather than develop the project
Potential for conflict with RCBC during rent reviews
Reduced community involvement
    1. Long Leasehold at Peppercorn Rent

 

Positive Issues Negative Issues
Reduced risk of asset being lost Potential inability to use asset as collateral
Maximum use of income in support of projects RCBC loses income
Possibility for maximum community involvement Weakens accountability
Structure high credibility with funders Reduced RCBC commitment to support the project

Of the above four options SCAA would prefer:

  • Tenure on a Freehold at Nominal or No Cost basis;

However, if RCBC determine this is not appropriate, it is considered that in order for The Works @ Marske Mill to be viable it would need:

  • Tenure on a Long Leasehold** at a Peppercorn Rent basis with a minimum term of 50 years and a preferred term of 99 years. n.b. We would expect covenants to this lease to protect the asset if the project should fail.

Subject to a decision by RCBC on the CAT in November 2011 SCAA would aim ideally to complete tenure negotiations in good time to facilitate possession of the site by 31st March 2012; in keeping with the asset disposal deadline of the same date.

Ideally once the CAT has been agreed in principle we would like unregulated access to the site so that work can begin on assessing and refining our plan in advance of possession. This will also enable us to ensure that the good condition of the building is preserved in the interim.

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