Damages — Principles governing assessment — Excess quantity of spoil placed on plaintiffs’ (respondents’) land contrary to an agreement regulating the amount to be dumped in connection with road construction works — Whether damages should be calculated on the basis of the cost of removing the spoil or on the difference between the land with spoil and the land without it — Huge difference in quantum of compensation, figures of £78,000 on cost basis as compared with £800 on the diminution of value basis having been suggested at the trial — Appeal by defendants from decision of Stuart Smith J in favour of cost basis — The trial judge accepted that the respondents had a substantial prospect, despite earlier planning refusal, of obtaining permission to develop the land on which excess dumping of spoil had taken place as part of their service station complex — The judge held that the respondents’ proposals for development were reasonable and that it was not only reasonable but necessary for them to remove the spoil before they could go ahead — He also held that assessment on the basis of the cost of removal was reasonable as between the parties — On appeal the appellants’ main attack on the judge’s findings was on the issue of planning permission for development, as it would be unreasonable to require the appellants to pay for removal of the spoil if development was not to be permitted — The Court of Appeal, however, held that there was evidence from which the judge was entitled to infer that the respondents had a substantial chance of obtaining planning permission; and the court rejected a submission that the amount should be scaled down to reflect the weight of the chance that such permission would not be obtained — Among authorities considered on the principles of assessment were Taylor (CR) (Wholesale) Ltd v Hepworths Ltd and Ward v Cannock Chase District Council — The proper approach was to ascertain the facts and, applying the two principles of reinstatement and reasonableness to those facts, award what the court considers to be reasonable compensation in the individual case — There was no prima facie rule that the normal measure of damage was the diminution of value with an onus on the plaintiff to show some good ground for departing from the normal measure — In the present case, once the judge had decided that the respondents had a substantial chance of getting planning permission he was entitled to hold that it was fair and reasonable to award damages on the reinstatement basis — Appeal dismissed — A cross-appeal by the respondents as to the precise quantity of the excess dumping was also dismissed
The following cases are referred to in this report.
Coleshill & District Investment Co v Minister of Housing and Local Government [1969] 1 WLR 746; [1969] 2 All ER 525; (1969) 20 P&CR 679; 68 LGR 334; [1969] EGD 736; 211 EG 727, HL
Davies v Taylor [1974] AC 207; [1972] 3 WLR 801; [1972] 3 All ER 836, HL
Kitchen v Royal Air Force Association [1958] 1 WLR 563; [1958] 3 All ER 241, CA
Lodge Holes Colliery Co Ltd v Wednesbury Corporation [1908] AC 323, HL
Mallett v McMonagle [1970] AC 166; [1969] 2 WLR 767; [1969] 2 All ER 178; [1969] 1 Lloyd’s Rep 127, HL
Munnelly v Calcon Ltd [1978] 1R 387
Taylor (CR) (Wholesale) Ltd v Hepworths Ltd [1977] 1 WLR 659; [1977] 2 All ER 784; (1976) 244 EG 631, [1977] 2 EGLR 31
Tito v Waddell (No 2) [1977] Ch 106; [1977] 2 WLR 496; [1977] 3 All ER 129
Ward v Cannock Chase District Council [1986] 2 WLR 660; [1985] 3 All ER 537
This was an appeal by Sir Alfred McAlpine & Sons Ltd, defendants in the court below, from a decision of Stuart Smith J, in favour of the plaintiffs, the present respondents, Minscombe Properties Ltd, in an action by the latter for damages for breach of contract in respect of the dumping of spoil on the respondents’ land abutting on the new A34 road between Oxford and Newbury and the intersection with the A4130 at Milton Heights.
S E Brodie QC and C J R Flint (instructed by Hill Dickinson & Co, of Liverpool) appeared on behalf of the appellants; J C Griffiths QC and Patrick Routley (instructed by Cole & Cole, of Oxford) represented the respondents.
Giving judgment, O’CONNOR LJ said: In breach of contract the defendants put 26,000 m3 of spoil on the plaintiffs’ land. How should the damages be assessed? The plaintiffs contend that they are entitled to have the land reinstated, that is to recover the cost of removing the spoil. The defendants contend that the plaintiffs are entitled to recover the difference between the value of the land as it is with the spoil on it and its value unburdened by spoil. The learned judge accepted the plaintiffs’ contention and referred the ascertainment of the cost of removing the spoil to the official referee. That cost may well be some 80 times greater than the difference in the value of the land with and without spoil; figures of £78,000 against £800 were suggested at the trial. The defendants appeal to this court.
The case arises out of the construction of the new A34 road between Oxford and Newbury. The defendants were the main contractors for a 10 kilometre stretch of the road including the intersection with the A4130 at Milton Heights just to the west of Didcot. The plaintiffs’ land abuts on the new road and the intersection. I shall have to examine the events of the 1970s in a little more detail later in this judgment, but for the moment suffice to say that in 1976 the parties agreed that the defendants should have the right to dump a quantity of spoil from their construction works on part of the land identified as O S 125A. The trial judge has found that in breach of that agreement the defendants overdumped on that part of O S 125A where they were entitled to dump and also dumped on that part of O S 125A where they were not entitled to dump.
The law on this topic is conveniently set out in the judgment of May J (as he then was) in Taylor (CR) (Wholesale) Ltd v Hepworths Ltd [1977] 1 WLR 659*. That was a case where the liability was in tort but, as May J pointed out, when one is considering what is the appropriate measure of damage for injury to land in possession there is no difference between contract and tort. The learned judge in his judgment set out the relevant parts of the judgment of May J at length and directed himself upon them. I do not read them into this judgment (they will be found at pp 666 to 669 of the report). I must,|page:16| however, draw attention to the approval by May J of the passage in McGregor on Damages at pp 666 to 667.
*Editor’s note: Also reported at (1976) 244 EG 631, [1977] 2 EGLR 31.
In considering whether diminution in value or reinstatement was the appropriate measure of damage, May J drew attention to a difference of opinion among academic lawyers as to how this problem should be approached (see his citation from Salmond on Torts and McGregor on Damages at pp 666 to 667). May J preferred the statement of the law in McGregor and said at p 667:
I think that these passages which I have just read from McGregor on Damages correctly reflect the state of the law. The various decided cases on each side of the line to which my attention has been drawn, and to some of which I have referred in this judgment, show in my opinion merely the application in them of two basic principles of law to the facts of those various cases. These two basic principles are, first, that whenever damages are to be awarded against a tortfeasor or against a man who has broken a contract, then those damages shall be such as will, so far as money can, put the plaintiff in the same position as he would have been had the tort or breach of contract not occurred. But secondly, the damages to be awarded are to be reasonable, reasonable that is as between the plaintiff on the one hand and the defendant on the other.
It will be seen that the test laid down by May J does not start from any premise that the normal measure of damage is the diminution in value with an onus on the plaintiff to show some good ground for departing from the normal measure. In my judgment the proper approach for the court is to ascertain the facts and, applying the two principles to those facts, award what the court considers to be fair compensation in the individual case. Taylor v Hepworths was a very good example. The plaintiffs’ billiard hall had been damaged by fire; they held it as a site for development and had no intention of rebuilding it and, not surprisingly, May J ruled out the cost of reinstatement. The demolition for redevelopment would have cost more than the diminution in value, so that measure was also ruled out, and the plaintiffs recovered the costs of the emergency work which they had had to do as a result of the fire.
The problem has been considered again at first instance in Ward v Cannock Chase District Council [1985] 3 All ER 537. In that case the plaintiff owned two cottages at the end of a terrace in which he lived with his family. The defendants, who owned the other cottages in the terrace, allowed them to become dilapidated and a prey to vandals to such an extent that they became ruinous and as a result the plaintiff’s cottages fell down. Scott J held that if planning permission was forthcoming or alternatively was unnecessary, the plaintiff was entitled to the cost of reinstatement. He held in the alternative that if planning permission was refused the plaintiff, who owned a small cottage nearby, was entitled to the cost of enlarging that property to house his family up to the reinstatement value of the cottages which had fallen down. Scott J reviewed the authorities, set out the passage from Taylor v Hepworths which I have cited, and said at p 557:
Finally, I should refer to Munnelly v Calcon Ltd [1978] 1R 387, a decision of the Supreme Court of Ireland. The plaintiff was an auctioneer who had carried on business from his house in Dublin. His house was irreparably damaged by the defendants’ negligence. He satisfied the trial judge that he had the genuine intention of rebuilding a new house on the site of this old house. The cost of the rebuilding would have been £65,000. The market value of the house was £35,000. It was established that for £35,000 the plaintiff could purchase elsewhere in the City of Dublin a house which would be comparable to his old house and that the move would not materially affect the plaintiff’s business. The trial judge awarded £65,000 damages. The defendants appealed.
In the Supreme Court Henchy J made this comment on reinstatement damages (at 399): ‘I do not consider that reinstatement damages, which may vastly exceed damages based on diminished value, are to be awarded as a prime facie right or, even if they are, that the plaintiff’s intention as to reinstatement should be the determining factor. I do not think the authorities establish that there is a prima facie right to this measure of damages in any given case. In my view, the particular measure of damages allowed should be objectively chosen by the court as being that which is best calculated, in all the circumstances of the particular case, to put the plaintiff fairly and reasonably in the position in which he was before the damage occurred, so far as a pecuniary award can do so.’
He then referred to C R Taylor (Wholesale) Ltd v Hepworths Ltd and cited the passage from the judgment of May J that I have read. He then continued (at 400):
‘I accept those two principles as being basic to, although not necessarily exhaustive of, the concept of restitutio in integrum on which the law of damages rests in cases such as this. It is in the application of those principles that difficulty may arise, for a court, in endeavouring to award a sum which will be both compensatory and reasonable, will be called on to give consideration, with emphasis varying from case to case, to matters such as the nature of the property, the plaintiff’s relation to it, the nature of the wrongful act causing the damage, the conduct of the parties subsequent to the wrongful act, and the pecuniary, economic or other relevant implications or consequencies or reinstatement damages as compared with diminished-value damages. The reported cases, therefore, require to be viewed primarily as exemplifications of the application to special facts of the two principles to which I have referred. In the present case I consider that the correct measure of damages is the diminished value of the building.’
After reviewing the facts of the case Henchy J concluded (at 401) that £35,000 damages, the diminution in value measure —
‘will be both compensatory and reasonable, whereas reinstatement damages of £65,000 would unjustifiably profit the plaintiff and unfairly penalise the defendants for their negligence.’
Kenny J agreed. He said (at 407): ‘The true principle is that the owner of a building is entitled to the diminution in value between the building as it was before the wrong and after it, unless he establishes that he intends to or has reasonably rebuilt the structure damaged or destroyed and that his is an exceptional case in which justice requires that he should be paid the cost of restoration . . . In my opinion, the owner is entitled to the diminution in value between the building as it was before the wrong and after it, unless he establishes that he intends to spend the restoration costs (if he is awarded these) on rebuilding and that his is an exceptional case which justifies departure from the test of diminution in value.’
Parke J agreed with both judgments.
I would respectfully accept and adopt these statements of principle.
It will be seen that there was a difference of approach between Henchy J and Kenny J. For reasons that I have given, I prefer the approach of Henchy J and I do not agree with Kenny J that there is any need for the plaintiff to show that his is an exceptional case before he can recover the cost of restoration.
Lastly the learned judge cited at some length from the judgment of Sir Robert Megarry V-C in Tito v Waddell (2) [1977] 1 Ch 106 at pp 332 to 335. That was the Ocean Island phosphate case and the question was what was the proper measure of damage for the defendant’s breach of covenant in failing to replant worked out mineral workings. The learned Vice-Chancellor was referred to and considered a number of authorities on the measure of damages for breach of covenant to repair, but he was not referred to any of the line of authority with which we are concerned in the present case and indeed said that in the absence of clear authority on the matter he proposed to consider the question as a matter of principle and did so. I do not find anything in that judgment which conflicts with the view that I have formed as to the correct approach to the measure of damage in the present case.
The plan shows the layout. O S 124 is in the angle between the new A34 and the A4130. To the east of it is the rectangular O S 125A. Beyond the eastern boundary of O S 125A are sewage works. To the south of these is O S 130. As early as November 1971 the plaintiffs prepared an application for planning permission to develop their land as a filling station complex. In May 1972 planning application was made to develop the land into a service station including petrol pumps, caravan touring clubs, overnight parking, hotel, restaurants, overnight lodging, security park, recreation park and swimming pool. In January 1973 the application was refused by the Abingdon Rural District Council, who gave the following reasons:
(1) The site is within a ‘white’ area in the county development plan wherein it is envisaged that existing uses of land shall remain for the most part undisturbed. The proposal constitutes a material change in the use of the land consideration of which is regarded as premature at this stage.
(2) The proposal is premature in advance of the construction of the new trunk road.
The fact is that O S 125A was scrub land with some old disused buildings on it.
In 1975 the plaintiffs agreed with the Oxfordshire County Council, who were the highway authority concerned with the construction of the new road, that they should use the southern part of O S 125A for dumping up to 4,000 m3 of material. As I read the findings of the judge, this was in part to fill up a depression and would have the effect of levelling the ground. In April 1976 the dumping agreement was made with the defendants; it was in two parts. The defendants were to have the use of the south-eastern end of O S 130 for storing topsoil and they were to dump spoil on the northern part of O S 125A to level it up with the southern end as transformed by the Oxfordshire County Council dumping. I have no doubt that the plaintiffs at all times intended to produce a firm level surface on O S 125A because at all times they envisaged developing a service station on the northern part of OS 124, and O S 125A would be required as a parking area, in particular a secure lorry park.
In November 1976 the plaintiffs made a fresh application to develop their land and this application was called in by the Secretary of State because other promotors had had the same idea for this|page:17| section of the A34 and the Secretary of State was already seised of three appeals into which an inquiry had opened. These planning matters were amalgamated into a single inquiry and the decision letter came on May 21 1979. The Secretary of State refused all the applications.
The defendants had finished dumping in 1977. The learned judge has found that at the end of 1977 they were asked to remove the excess spoil which had been dumped and, no agreement having been come to, the present proceedings were started in October 1979. The planning history between October 1979 and October 1981 is a little confused. On October 13 1979 the plaintiffs made application for planning permission to develop 2.75 acres in the northern part of O S 124 as a service station, retail kiosk, cafe/restaurant, small recreation area and toilets. This application was made to the new local planning authority, the White Horse District Council, under reference MIL/2466/3X. It seems that the planning authority failed to deal with the application within the prescribed time so the plaintiffs appealed to the Secretary of State under sections 36 and 37 of the Town and Country Planning Act 1971.
While this procedure was in train the plaintiffs resubmitted the application to the local planning authority on February 25 1980. It went forward under reference number MIL/2466/9X and on March 28 1980 outline permission was granted. On May 20 1981 the plaintiffs applied for approval of matters reserved under MIL/2466/9X, and on October 27 1981 the Vale of White Horse District Council granted permission for the matters reserved, so that on that date the plaintiffs had full permission for the development of the service station on the northern part of O S 124. In the meantime, on July 31 1981, the Secretary of State allowed the plaintiffs’ appeal against the ‘refusal’ of MIL/2466/3X. By the date of trial in October 1984 the service station had been built. Since the refusal of planning permission for the much greater development in 1979, no application had been made to develop O S 125A.
The learned judge, having directed himself on the law applicable, began his application of the law to the facts of the case on p29 of his judgment. I find it necessary to quote what he said at length:
How are these principles to be applied to the facts of this case? Mr Flint submits that before the plaintiffs can recover the cost of removing the spoil they must surmount three hurdles. They must prove, first, that they intend to carry out the work; second, that it must be capable of being carried out; and, thirdly, that the damages are reasonable. He contends that the plaintiffs have not established that they intend to do the work. He points out, correctly as it seems to me, that planning permission will be required to remove the 26,000 cubic metres of spoil — see Coleshill & District Investment Co v Minister of Housing and Local Government [1969] 1 WLR 746 at pp 756C and 770A, and also the Town and Country Planning Act 1971, sections 22 and 23 — and also to develop the site as an extension of the service station. No current application has so far been made for this. He also points out that apart from trying to get a contractor to take the spoil away free and a recent inquiry in relation to another contractor the plaintiffs have done little to set in train the removal of the spoil. But the fact is that Mr Bailey has shown a single-minded determination to develop this area of land for the past 12 years. In spite of considerable setbacks his persistence has been rewarded. He has overcome the refusal of two planning applications and resorted to proceedings for judicial review, his efforts being finally rewarded when in 1981 he was granted permission to develop O S 124 and that development is now nearing completion.
Mr Bailey is convinced that the development of O S 125A at its northern end as a lorry park makes commercial sense because the new A34 is now a main lorry route between Southampton and the Midlands and his is the only service station so far planned or constructed on a long stretch of the road. Moreover, his plan for a caravan park on the south end of O S 125A is inspired by the great number of caravans that flow along the route and require parking for up to 24 hours or so. I am satisfied that insofar as it lies in his power it is Mr Bailey’s intention to develop O S 125A as part of the plaintiffs’ service station complex. But of course the accomplishment of that aim does not depend solely on the plaintiffs’ wishes. It requires planning permission. I cannot see that there would be any difficulty in obtaining planning permission to remove the 26,000 cubic metres of spoil, but there would probably be little point in doing that save to make the mound less unsightly and more acceptable to agriculture unless it is also possible to develop the area as part of the service station.
Mr Flint points out that the present position is that as a result of the planning inquiry in 1977 and refusal in 1979 permission to develop O S 125A has been refused and the land is still designated white land. The plaintiffs have called no expert to assist the court as to the likelihood of the grant of permission. It was Mr Dobson’s view as a result of his inquiries that it was unlikely to be granted. Mr Flint concedes that the plaintiffs have a chance of obtaining planning permission but he submits that it is a remote chance and not sufficient to enable the plaintiffs to surmount the second hurdle. Alternatively, he submits that if the plaintiffs merely have a chance of doing the development this chance should be evaluated on the principles laid down in Davies v Taylor [1974] AC 207 and Kitchen v Royal Air Force Association [1958] 1 WLR 563, and either the quantum of the claim proportionately reduced or the alternative basis of diminution in value of the land adopted. The court cannot determine the issue of whether planning permission will be granted without holding a planning inquiry. I have little doubt that if in the wake of refusal of permission in May 1979 the question had been asked, will permission be granted to the plaintiffs to build a service station on O S 124? many people, including Mr Dobson, would have answered the question, no; yet within 18 months such permission had been granted. The plaintiffs’ proposals for O S 125A seem to me to be reasonable and sensible as an extension to the service station. They are by no means over-grandiose or impracticable. The land, both in its present state and before 1976, was useless for agriculture and may well have had an existing commercial use as Mr Bailey asserted. These may well be relevant factors in the grant of planning permission. The area lies between the main A34 trunk road and the Didcot spur road. It is adjacent to an existing access point, and I do not suppose that the land immediately to the east, the now disused sewage works, is an area of outstanding natural beauty. To this must be added the fact that the plaintiffs’ service station is the only one on a substantial stretch of this new road. I bear in mind what Mr Dobson said about his inquiries from the planning authorities. But the conclusion which I have come to is that the plaintiffs have a substantial chance or prospect of obtaining planning permission to develop the land in conjunction with their service station.
Is an award of damages of the order of £78,000 reasonable as between the plaintiffs and the defendants? If this inquiry is limited to a comparison between the cost of removal and the diminution of the value of the land, the answer would seem to be, no. But the real question in my view is whether the plaintiffs’ proposal to remove the spoil is a reasonable one having regard to all the circumstances of the case of which the pre-existing value is only one. Thus it may be unreasonable to insist on precise restoration where some other solution is equally effective and serviceable. See for example Lodge Holes Colliery Co Ltd v Wednesbury Corporation [1908] AC 323, where the plaintiffs were not entitled to recover the costs of restoring a road to its former level where the surface had been lowered through mining subsidence when a perfectly satisfactory road could be constructed at the new level at a much lower cost. It is quite clear that with the benefit of planning permission the value of O S 125A is much greater than that assessed by Mr Dobson. To the owner of a service station that land may be worth far more than £1,000 an acre if there is a substantial chance that it can be used in conjunction with the service station. Granted that the plaintiffs’ proposals to develop the land are reasonable, as in my view they are, then it is not only reasonable but necessary for them to remove the spoil before they can go ahead.
I have come to the conclusion that the plaintiffs’ claim cannot be defeated on the ground that the basis of assessment of the cost of removal is unreasonable as between the plaintiffs and the defendants. I have anxiously considered whether or not some discount should be made on the full cost of the removal to reflect the possibility that it may never be done and so give effect to the principle in Davies v Taylor, but I have come to the conclusion that I should not. The matter is dealt with in the fifth point to which the Vice-Chancellor refers at p 334 of his judgment in Tito v Waddell (No 2), a point with which I respectfully agree. There are an infinite number of possibilities that may arise to defeat a firm intention to pursue a course of action. A continued and permanent refusal of planning permission is only one of them. Moreover, given Mr Bailey’s single-minded perseverance to achieve his cherished plans for this site, it is by no means improbable that he will wish to remove the spoil from O S 125A to enhance his prospect of obtaining planning permission, and I think there is some evidence that the existence of some physical defect or deficiency in the land, as, for example, lack of fill material where it is needed or excess fill where it is not, involving in either case costly operations, may inhibit the grant of planning permission.
In the result the plaintiffs’ claim succeeds and the damages will be the cost of removing 26,000 cubic metres of spoil from the land. If that cost cannot be agreed it will have to be referred for further assessment of damages.
The whole thrust of the defendants’ appeal is directed against the findings of the learned judge on the issue of planning permission to develop O S 125A. The issue is crucial because it is obvious that it would be unreasonable to require the defendants to pay for the removal of the spoil if no development is to be permitted. First it is said that there was not sufficient evidence to support the finding that the plaintiffs have a substantial chance of getting planning permission.
The defendants submit that the starting point for any assessment in 1984 was that in 1979 planning permission had been refused and that no further application either to remove the spoil or to develop O S 125A had been made. They submit that from that premise it was not open to the learned judge to conclude that planning permission would probably be achieved without evidence. The plaintiffs called no expert evidence and the defendants’ expert, Mr Dobson, said that in his opinion permission would not be granted.
Mr Dobson, the defendants’ expert, was an expert in valuing agricultural land, and he said that he did not have much expertise on planning matters and that he did not deal with commercial|page:18| development. He said: ‘We have experts in our office who deal with that.’ His evidence-in-chief on this topic is on p 57:
Q What view did you form as to whether the site had any additional value as a development site? A I made inquiries of course from the various planning authorities which are the Oxfordshire County Council, the South Oxford District Council and the Vale of White Horse District Council and each replied that there was no foreseeable prospect of development on that land. I then wrote to the Vale of White Horse District Council and they replied confirming that.
He said later in his evidence that he understood that development to the south or south-east would not be permitted as encroaching into open country. That consideration seems to me manifestly irrelevant when considering O S 125A, which is between the new filling station and the now disused sewage works.
It is, however, not correct to say that there was no other evidence available to the judge. He attached great importance to the fact that planning permission to develop the filling station was granted and the reasons which he set out on p 30 of his judgment were all supported by evidence. In addition he had before him the decision letters of the Secretary of State of May 21 1979 refusing permission and of July 30 1981 giving permission to develop the smaller project. In 1979 the need for service facilities on the new road between the Peartree roundabout north-east of Oxford and the M4 interchange just north of Newbury was recognised. The objection to the Minscombe application included highway objections of access (these had been resolved by 1981). A factor in refusing permission in 1979 was that the application asked for a caravan parking facility and motel: it was said that location next to a sewage works was undesirable. The sewage works have closed.
Once the judge had found that Mr Bailey, through Minscombe, had all along been and remained determined to create a service complex on this land, then I think that there was ample evidence from which he was entitled to draw the inference that the plaintiffs had a substantial chance of obtaining planning permission.
The defendants submit that even if this be so it is not enough to establish that it is reasonable to require them to pay for removing the spoil. They submit that this requires at the very least a finding that it is more probable than not that planning permission will be granted. The judge did not make that finding, and the defendants say he could not do so, as he himself recognised, and that it must follow that the plaintiffs are entitled to no more than the difference in value figure. I cannot agree with this submission. I do not think that there are any grounds for fettering the balancing exercise by ordaining that it cannot begin unless and until the plaintiffs have proved that it is more probable than not that planning permission will be granted. The fallacy is in asserting that if it is unfair and unreasonable to order reinstatement where no development is to be permitted, it can only become fair and reasonable if it is shown that there is a better than 50% chance of obtaining planning permission. I think that once he had decided that the plaintiffs had a substantial chance of getting planning permission he was entitled to hold that it was fair and reasonable to order reinstatement and in my judgment he was right to do so.
In the alternative the defendants contend that the learned judge was wrong to award the full cost of removing the spoil. They submit that he ought to have assessed the chances of planning permission being granted and awarded only a pro rata proportion of the cost of removal, or at least reflected the chance that planning permission might not be granted by scaling down the full cost of removal. In support of this contention Mr Brodie relied on two decisions in the House of Lords and one in the Court of Appeal, Mallett v McMonagle [1970] AC 166, Davies v Taylor [1974] AC 207 and Kitchen v Royal Air Force Association [1958] 1 WLR 563. In Kitchen solicitors had allowed the plaintiff’s claim for damages under the Fatal Accidents Act to become statute barred. The defendants contended that in order to ascertain whether the plaintiff had suffered more than nominal damages the barred action should be tried out. This court rejected that contention, Lord Evershed MR saying at p 575:
In my judgment, what the court has to do (assuming that the plaintiff has established negligence) in such a case as the present, is to determine what the plaintiff has by that negligence lost. The question is, has the plaintiff lost some right of value, some choice in action of reality and substance? In such a case, it may be that its value is not easy to determine, but it is the duty of the court to determine that value as best it can.
It will be seen at once that that is a wholly different situation. In the present case the plaintiffs have not lost the chances of anything as a result of the defendants’ breach of duty and there is no chance to be valued.
Both Mallett and Davies are Fatal Accidents Act cases. It must be remembered that under those Acts a statutory cause of action is given to certain categories of persons who can show that they will suffer pecuniary losses as a result of the death of a person. Over the years the judges have established what has become a conventional method of assessing damages, namely ascertain a multiplicand and apply to it a multiplier. Both exercises inevitably involve the evaluation of a wide variety of chances, many of which are set out by Lord Diplock in his speech in Mallett. That case, however, was concerned with the question as to whether the Court of Appeal in Northern Ireland was right to overturn an award by a jury. Lord Diplock demonstrated why inflation should be disregarded, why a single figure should be used for the multiplicand, why actuarial tables could not provide an answer and much more, but in my judgment none of this has anything to do with the assessment of damages in the present case.
In Davies the plaintiff had left her husband for another man five weeks before his death. She had refused to come back and he had given instructions to solicitors to institute divorce proceedings. The plaintiff claimed that but for his death she would have returned to her husband and resumed her dependency. The trial judge held that on the balance of probabilities the plaintiff had not established that she would have returned to her husband and dismissed her claim. The House of Lords held that he had applied the wrong test, but applying the right test her claim failed. All the speeches make it clear that, as Lord Simon of Glaisdale said at p 219:
The appeal is concerned with a claim for damages for deprivation of the possibility of being the dependant of the deceased, which turned on the chances of a reconciliation between the appellant and the deceased.
Lord Reid said at p 213:
‘Injury’ in the Fatal Accidents Act does not and could not possibly mean loss of a certainty. It must and can only mean loss of a chance. The chance may be a probability of over 99 per cent but it is still only a chance. So I can see no merit in adopting here the test used for proving whether a fact did or did not happen. There it must be all or nothing.
If the balance of probability were the proper test what is to happen in the two cases which I have supposed of a 60 per cent and a 40 per cent probability? The 40 per cent case will get nothing but what about the 60 per cent case? Is it to get a full award on the basis that it has been proved that the wife would have returned to her husband? That would be the logical result. I can see no ground at all for saying that the 40 per cent case fails altogether but the 60 per cent case gets 100 per cent. But it would be almost absurd to say that the 40 per cent case gets nothing while the 60 per cent case award is scaled down to that proportion of what the award would have been if the spouses had been living together. That would be applying two different rules to the two cases. So I reject the balance of probability test in this case.
I have cited these passages first because they show what Lord Reid meant in the passage on which Mr Brodie relied at p 212:
The peculiarity in the present case is that the appellant had left her husband some five weeks before his death and there was no immediate prospect of her returning to him. He wanted her to come back but she was unwilling to come. But she says that there was a prospect or chance or probability that she might have returned to him later and it is only in that event that she would have benefited from his survival. To my mind the issue and the sole issue is whether that chance or probability was substantial. If it was it must be evaluated. If it was a mere possibility it must be ignored. Many different words could be and have been used to indicate the dividing line. I can think of none better than ‘substantial,’ on the one hand, or ‘speculative’ on the other. It must be left to the good sense of the tribunal to decide on broad lines, without regard to legal niceties, but on a consideration of all the facts in proper perspective.
I am well aware of the fact that in real life chances rarely are or can be estimated on mathematical terms. But for simplicity of argument let me suppose two cases of a widow who had separated from her husband before he was killed. In one case it is estimated that the chance that she would have returned to him is a 60 per cent probability (more likely than not) but in the other the estimate of that chance is a 40 per cent probability (quite likely but less than an even chance). In each case the tribunal would determine what its award would have been if the spouses had been living together when the husband was killed, and then discount it or scale it down to take account of the probability of her not returning to him.
In my judgment this line of authority is of no help in the present case because, as I have said, we are not concerned with valuing a lost chance of anything. Once it is decided that the fair and proper measure of damage is the cost of removing the spoil it would, I think, be wholly illogical to scale it down as envisaged by Lord Reid in Davies. Scaling down as a result of a pure guesswork evaluation of ‘the substantial chance of planning permission’ would produce an award that was neither flesh nor fowl but was a fair red herring. As
the Vice-Chancellor said in Tito v Waddell (2) at p 334, ‘the court ought to be ready to act on evidence which, without assuring certainty, nevertheless carries conviction’.
During the hearing we gave leave to the defendants to amend the notice of appeal to enable them to submit that the assessment of damages should have been and should be adjourned to await the outcome of a planning application in respect of O S 125A. Apart from any technical objections, I do not think it would be right to consider such a course unless I had come to the conclusion that the learned judge was wrong to do as he did and that a fair assessment was not otherwise possible. As I have not come to any such conclusion I reject the submission. I would dismiss this appeal.
Cross-appeal
The plaintiffs say that the learned judge made a mistake in calculating that the excess spoil amounted to 26,000 m3. O S 125A was in all 3.45 acres. The contract with Oxford County Council was to tip on the southern part, 1.44 acres. The agreement with the defendants was for the northern part, 2.01 acres. It was agreed that at the end of the day 40,000 m3 had been dumped on the land. It was accepted that Oxford had dumped 4,000 m3 on the 1.44 acres. After exhaustive investigation the learned judge found that the defendants would have been entitled to dump 10,000 m3 on the 2.01 acres. Arithmetic produces the excess of 26,000 m3. The learned judge checked his finding of 10,000 m3 against a commercial dumping rate of 20p per m3 as applied to a fee of £1,000 per acre. It is said that he fell into error because £700 per acre was rent and therefore the check did not support his finding. It was submitted that the judge ought to have found that the defendants were not entitled to dump more than 6,000 m3 on the 2.01 acres and that the excess was 30,000 m3, not 26,000 m3. Even if the judge did get his check wrong, and I do not accept that he did, I do not think it would warrant us in holding that his decision, reached on complicated evidence about the shape of the land, the levels, grading and other factors, was wrong. It was essentially a question of fact and I would not interfere with the judge’s conclusion. The plaintiffs further say that an agreement to dump subsoil excavated during road construction does not permit dumping material containing foreign matter like tins etc and that some 6,000 m3 will have to be cleaned. I cannot accept this contention and I would dismiss the cross-appeal.
CROOM-JOHNSON LJ agreed that the appeal and cross-appeal should be dismissed for the reasons given and did not add anything.
The appeal and cross-appeal were dismissed with costs; leave to appeal to the House of Lords was refused.
