41 Related party transactions
Details of directors’ remuneration are given in the report of the remuneration comittee and note 11. Other related party transactions are as follows:
Group
Messrs J.D. Burns and S.P. Silver are partners in The Pilcher Hershman Partnership (PHP), estate agents. The partnership occupied offices owned by the group for which they paid a commercial rent in the year of £0.1m (2008: £0.1m). In addition, it received fees at a commercial rate in respect of the letting, acquisition and disposal of certain properties owned by the group of £0.3m (2008: £0.9m) during the year. Procedures have been established whereby the audit committee are able to verify that neither Messrs Burns nor Silver derive any direct benefit from these fees.
The Hon R.A. Rayne is a director of LMS Capital plc, an investment company, which occupies offices owned by the group for which they paid a commercial rent of £0.4m (2008: £0.4m). The group also contributed £0.1m (2008: £0.1m) to the company’s running costs in the year.
During the year, the group paid fees at a commercial rate in respect of the acquisition of certain properties of £nil (2008: £0.1m) to Everton Philips LLP, a firm in which the son of Mr J.D. Burns is a partner, and £0.1m (2008: £nil) in respect of the disposal of certain properties to Hamilton Investment Properties Ltd, a company of which Mr S.P. Silver’s son is a director.
There are no outstanding balances owed to the group with respect to all of the above transactions.
At 31st December 2009, included within other receivables in note 22 is an amount owed by the Portman Estate, the minority owner of one of the group’s subsidiaries, of £8.7m (2008: £8.7m). The majority of this amount represents advances to the Portman Estate, relating to proceeds received upon the disposal of jointly owned properties. This debt will be discharged by a distribution to shareholders.
Company
The company received dividends from some of its subsidiaries during the year. These transactions are summarised below:
| Dividend received | Balance owed/(owing) | ||||
|---|---|---|---|---|---|
| 2009 | 2008 | 2009 | 2008 | ||
| £m | £m | £m | £m | ||
| Related party | |||||
| Bramley Road Ltd | – | – | – | 0.6 | |
| Derwent Valley Central Ltd | – | 50.0 | 251.9 | 287.7 | |
| Derwent Valley London Ltd | – | – | 129.4 | 131.3 | |
| Derwent Valley Property Developments Ltd | – | 12.0 | 55.9 | 59.5 | |
| Derwent Valley Property Investments Ltd | – | – | (3.5) | (2.2) | |
| Derwent Valley West End Ltd | – | – | (1.9) | – | |
| Derwent Valley Property Trading Ltd | – | – | (2.1) | – | |
| Derwent Valley Railway Company* | – | – | (0.2) | (0.2) | |
| London Merchant Securities Ltd † | 8.6 | 60.0 | (57.9) | 65.9 | |
| 8.6 | 122.0 | 371.6 | 542.6 | ||
* Dormant company.
† Balance owed includes subsidiaries which form part of the LMS sub-group.
The group has not made any provision for bad or doubtful debts in respect of related party debtors. Inter-company balances are repayable on demand. No interest is charged on inter-company balances.
During the year the company became the beneficial owner of the shares in LMS (Kingston) Ltd, a company within the LMS sub-group. (see Note 19 for further details). During the year the company also increased its investment in two of its subsidiaries: Derwent Valley West End Ltd, by £2.0m, and Derwent Valley Property Trading Ltd, by £2.1m.