The law on how the court decides whether to award damages instead of an injunction where property rights are infringed has changed significantly following Lawrence v Coventry [2014] UKSC 13; [2014] PLSCS 65. Before the Supreme Court judgment in that case, claimants were often able to rely to good effect on the decision in Shelfer v City of London Electric Lighting Co Ltd [1895] 1 Ch 287 to obtain an injunction against a party that had committed a wrongful act.
Shelfer laid down the criteria that the court should apply when deciding whether to award damages in lieu of an injunction. However, the Supreme Court deplored the tendency to use the criteria as boxes that all needed to be ticked before the court could award damages instead of an injunction. Lord Neuberger explained that the checklist in Shelfer is not an exhaustive statement of the circumstances in which damages may be awarded instead of an injunction and indicated that the court should take a flexible approach to such applications. However, the Supreme Court did not set any hard and fast rules and left the courts to develop the law further.
So it might have seemed as if there was everything to play for in Charlie Properties Ltd v Risetall Ltd [2014] EWHC 4057 (Ch); [2014] PLSCS 336. The case concerned a trespass, which took place following an unsuccessful attempt to buy land. The would-be purchaser was in the course of redeveloping its property and, when the negotiations came to nothing, it proceeded to appropriate the land that it needed and incorporated it into its construction site.
The developer concreted over a yard to make it easier to store building materials, erected a portacabin, dug out a light well to benefit the basement of its development, fenced off the roof of one of its neighbour’s buildings, put up fencing and decking, and created new doors in the residential units that it had constructed with Juliet balconies extending into its neighbour’s air space. The developer admitted that it was trespassing and accepted liability to pay damages, but resisted its neighbour’s claim for an injunction.
The developer referred the court to the decision in Lawrence and argued that the court now has an unfettered discretion to award damages in lieu of an injunction, having regard in particular to the public interest and the effect that an injunction would have on third parties. However, the judge took the view that there is less justification for refusing an injunction for trespass than in nuisance cases, since the trespasser would be seeking to buy the right to interfere, not merely with the enjoyment of property, but with the property itself.
The trespass here was both deliberate and flagrant. It was not committed inadvertently or in ignorance of the adjoining landowner’s rights and the developer had not suggested that an injunction would affect the public interest or adversely affect third parties. Home and Colonial Stores Ltd [1904] AC 179 was authority for the proposition that an injunction might be necessary if a defendant has acted in a high handed manner or tried to steal a march on a claimant, in order to do justice to the claimant and as a warning to others. The judge thought that was clearly such a case and granted the claimant the injunction sought.
Allyson Colby is a property law consultant
