Trespass – Damages – Rental value – Expert evidence – Respondent claiming damages for unlawful occupation of land – Respondent increasing claim for lost rental income – Court awarding damages in higher sum – Appellant appealing – Whether judge wrong to allow respondent to increase claim for lost rent – Whether judge wrong to accept expert valuation evidence given without site visit – Whether expert wrong to ignore impact of tipped waste on rental value of land – Whether judge failing to give sufficient weight to previous lower valuation report – Appeal dismissed
The appellant had initially occupied, under licence, a 7.2-acre industrial site at 630, Whessoe Road, Darlington, County Durham belonging to the respondent. In breach of the licence terms and planning controls, the appellant used the land as a waste disposal site and caused or permitted large quantities of waste to be dumped there. He was prosecuted by the Environment Agency and convicted of acting contrary to environment regulations.
In 2008, the respondent terminated the licence and gave notice to quit. The appellant failed to comply with the notice and remained in occupation for periods totalling 51 months between 2009 and 2014. In earlier proceedings involving the appellant and the respondent, the notice to quit was held to be effective and the appellant declared to be a trespasser. The respondent issued proceedings for immediate possession and damages for trespass, including lost rental income at a rate of £12,000 per annum, making a total of £78,000 and continuing at the rate of £2,000 per month until vacant possession was given. The respondent subsequently served expert evidence estimating the total loss of rental income as £285,700, equating to £78,000 per annum. At the trial of the action, the judge took the view that, in the light of the expert report and the respondent’s witness statement, it had been clear to the appellant that the respondent was claiming about £285,000 and the case had been opened on that basis. The judge gave judgment for £285,700.
The appellant appealed contending that: (i) the judge was wrong to allow the respondent to increase its claim for lost rent from £12,000 to £78,000 per annum without an application to amend its particulars of claim where the appellant was taken by surprise by the unexpected increase; (ii) the judge was wrong to accept the valuation evidence of the claimant’s expert when the expert had not visited the land; (iii) the expert had been wrong to ignore any impact on the rental value of the land as a result of tipped waste even though it was not part of his instructions; and (iv) the judge had failed to give sufficient weight to an earlier valuation report in 2010 which valued the site at £10,000.
Held: The appeal was dismissed.
(1) The judge was right to take the view that the appellant had not been taken by surprise by the increase in the claim for lost rent. Not only had the appellant been served with the expert report and the witness statement over seven months before the trial, but the appellant had raised questions with the expert six months before the trial, on the figure for lost rent put forward by him. As there was no unfairness in permitting the respondent to proceed with its claim for lost rent at a rate of £78,000, it was well within the case management powers of the judge not to require a formal amendment of the particulars of claim.
(2) Whether it was necessary for a valuer to visit the land in question depended on the circumstances. It might be possible to provide a reliable opinion on rental values without a visit. The presence of substantial quantities of dumped waste on a site was likely to depress rental values, if it was not removed before letting, and a physical inspection might well be required before a reliable opinion could be given. However, in the circumstances of the present case, it was not an objection on which the appellant could rely. In the previous proceedings between the same parties, it was found that the appellant had permitted or caused very large quantities of waste to be dumped on the land. That finding was binding on him as against the respondent. He could not seek to reduce the amount of lost rental by reference to the presence of waste for which he was responsible. If the appellant’s case was that there was a significant amount of waste present on the land before he went into occupation, it was for him to lead evidence of it and to prove its effect on rental values. He had not done so.
(3) The expert had been entitled to ignore the impact of waste disposal on the rental value of the land and to produce an average figure for industrial land in general. The expert report stated simply “average rental income for 7.2 acres of industrial land (excluding development or hope value)”. When questioned by the appellant, the expert responded that he had used “comparable assessments” but the appellant did not ask to see those comparables. The expert had made clear that the issue of unlawful tipping was not part of his remit. Although it was neither common nor appropriate for an expert valuation report to give no information on the comparable values on which the expert’s opinion was based, that was a matter for the appellant to pursue in cross-examination, if not before. He could not rely on the poor condition of the land to justify a lower figure.
(4) At the time of the 2010 valuation, there was an outstanding enforcement notice issued by the local authority as a result of the use of the land by the appellant for unlawful waste tipping. The valuation was prepared expressly on the basis that the enforcement notice was in force and that the land was in need of remediation, the costs of which had not been ascertained, and that it was unlawfully occupied by the appellant and could not therefore be sold with vacant possession. It was not therefore relevant to a rental valuation of the land with vacant possession and without the damage caused by the appellant’s unlawful tipping.
Richard Stubbs (instructed by Punch Robson, of Ingleby Barwick, Teeside) appeared for the appellant; the respondent appeared in person.
Eileen O’Grady, barrister
Click here to read transcript: Shepherd v Collect Investments Ltd
