Louise Clark considers a High Court decision in which damages for trespass reflect the benefit to trespasser, not loss to landowner.
Key points
- Mesne profits are damages measured by reference to the benefit derived by the trespasser rather than the loss suffered by the landowner
- In some cases, the measure of damages can be the same as negotiating damages
The High Court has considered an unusual claim for damages for trespass in Chedington Events Ltd v Brake and another [2023] EWHC 2804 (Ch), the latest decision in the wide-ranging litigation between the parties.
Background
The defendants ran a weddings and events business on behalf of the claimant at West Axnoller Farm in Dorset. They were able to use, as additional benefits of their employment, equestrian facilities, particularly a covered arena, for stabling and exercising their horses. They stayed in the main house (then called Axnoller House) when it was not required for an event, and when there was an event they stayed in a nearby cottage, of which they were two of the three legal owners.
The defendants were dismissed from their positions with effect from 30 November 2018 but they refused to leave the house and move back to the cottage or to remove their horses from the equestrian facility.
The claimant sought possession of the house and the arena and obtained orders for possession in February 2022. The defendants finally left the equestrian arena in March 2022 and the house in April 2022 immediately prior to execution of a warrant of possession. The claimant sought mesne profits or damages for the defendants’ use and occupation of the house and arena.
In the meantime, in January 2019, the claimant’s parent company forcibly entered the cottage believing that it had acquired all the beneficial interest in it and was entitled to take possession. A claim for unlawful eviction by the defendants failed but was reversed by the Court of Appeal with the question of relief still to be determined.
The arguments
The court dismissed the defendants’ argument that the arena was unlettable because it had no planning permission for commercial purposes and was unsafe. The land concerned had always been used for commercial purposes and no other permission was required for the use and training of horses there. The arena was constructed more than 10 years previously and it was now too late for planning regulation enforcement to take place.
The defendants pleaded that they had made numerous offers to move to the cottage – in November 2018, early April 2019, September 2020 and April 2021 – which, if accepted, would have resulted in them moving to the cottage no later than 8 July 2019. Consequently, they were not liable for losses incurred by the claimant after that date.
The court considered the various offers made by the defendants and determined that they were not serious offers to vacate the house but attempts by the defendants to improve their bargaining position in the wider litigation between the parties. Even if the cottage had been available after January 2019, the defendants would not have vacated the house and arena in any event.
Equally, the defendants’ argument that the claimant’s losses had been caused by their parent company occupying the cottage did not wash. The defendants had not established that, even if they had moved to the cottage, they would have vacated the house.
The law
Trespass is an offence of strict liability. Mesne profits are damages which, in the absence of special circumstances, are measured by reference to the benefit obtained by the trespasser rather than the loss suffered by the claimant. So, it is not necessary for a landowner to show that premises could or would have been let but for the trespass: Inverugie Investments Ltd v Hackett [1996] 1 EGLR 149.
Mesne profits combine elements of compensatory and restitutionary principles. Such damages are distinct from negotiating damages, which are the price that the parties would have negotiated for the right to do what would otherwise be prohibited: Wrotham Park Estate Co Ltd v Parkside Homes Ltd [1973] 229 EG 617.
However, in the sense that the benefit is the objective value of the wrongful use, the measure, in this case, was the same: Morris-Garner v One Step (Support) Ltd [2019] UKSC 20; [2019] EGLR 26.
Valuation
The claim was assessed on the basis of letting value. The defendants excluded the claimant from occupation of the house and the immediately surrounding amenity land, which needed to be taken into account.
The proximity to the house of the wedding/party venue merited a 25% discount on its ordinary letting value to take account of the extra traffic and disturbed nights for between 45 and 60 days each year.
During the defendants’ occupation, the claimant had paid for all services to the house – some of which were combined – and maintained the grounds. However, such benefits did not affect letting value.
The house was valued at £48,000 per annum from November 2018 to November 2021 and £60,000 thereafter. The 25% reduction for the wedding venue disturbance element resulted in figures of £36,000 and £45,000. The award of mesne profits for 1,263 days equated to £128,687.91.
The arena was to be valued as an equestrian facility because that is what the defendants used it for, with no reduction for lack of building control sign-off, which made no difference to value. The arena was valued at £33,000 per annum and the award of mesne profits for 1,196 days amounted to £108,130.36.
The combined award was £236,818.27 and the claimant was entitled to interest at 8% under section 17 of the Judgements Act 1838.
Louise Clark is a property law consultant and mediator
