The High Court decision in HXRUK (II) (CHC) Ltd v Heaney [2010] PLSCS 238 has set legal tongues wagging. The furore concerns the remedies available where rights of light are infringed.
The problem in Heaney lay not with the law but with how the judge should apply it in circumstances where a developer had taken a risk by constructing and letting the top floor of a building, despite protests concerning loss of light in an adjoining building.
The developer accepted that its development had caused an actionable loss of light, but asked the judge to award damages instead of an injunction. It sought to distinguish Regan v Paul Properties DPF No 1 Ltd [2006] EWCA 1319; [2006] 3 EGLR 94; [2006] 46 EG 210, where the court granted a mandatory injunction for the demolition of part of a building that infringed a home owner’s right to light, on the ground that the premises in the instant case were commercial.
The leading case on the court’s power to award damages instead of an injunction is Shelfer v City of London Electric Lighting Co Ltd [1895] 1 Ch 287. It established that an award of damages will normally be appropriate where: (i) the injury to the claimant’s legal rights is small; (ii) the injury can be estimated in monetary terms; (iii) the injury can be adequately compensated for by a small monetary payment; and (iv) the grant of injunctive relief would be oppressive. The Shelfer principles are cumulative and a defendant will avoid an injunction if only it can satisfy them all.
The court accepted that access to light is more important in a home than in industrial or commercial premises, but decided that the injury was not small. The character of the adjoining building (which had been recently restored at great expense) and the loss of light were such that the landowner should not be expected to accept a money payment that, had the court awarded damages, would have been in the sum of £225,000. This was not a “small” amount, even if considered, not in absolute terms, but in respect of the value of either property or to the cost of the work required to reduce the size of the top two floors of the new office building.
The developer argued that it would be oppressive to grant an injunction because: (i) the demolition work would be expensive and disruptive and would reduce the amount of prime office space available in the area; and (ii) the adjoining landowner had been dilatory and had failed to commence legal proceedings to protect his position (which had, in effect, forced the developer to do so instead).
The judge disagreed. The infringement was neither inadvertent nor trivial. It was committed with a view to profit, in the knowledge that what was being done was actionable. The developer could have built top floors of reduced dimensions and it would be wrong for the court to sanction the infringement of the adjoining landowner’s rights of light by compelling him to accept a monetary payment that he did not want.
The decision underlines the potency of claims to rights of light and highlights the importance of resolving any potential claims before development begins.
Allyson Colby is a property law consultant
