Whatever support may be gleaned by landowners from case law on rights to light injunctions, the fundamental principles remain.
Key points
• One of the remedies which can be available in rights to lights cases is a quia timet injunction to prevent the obstruction.
• Parties seeking an injunction to prevent interference with rights to light must be able to show “an immediate threat to do something which requires the intervention of the court to prevent it”.
• A landowner cannot by its own actions create an immediate threat to infringe rights to light where none otherwise exists.
• A disagreement as to the existence or impact of rights to light or a refusal to provide an undertaking will not create an immediate threat of infringement where one does not otherwise exist.
The principle that a building can enjoy rights of light through specific windows is well established in law. Rights can be created either by express agreement or by prescription after more than 20 years’ use. Once a right is established, any obstruction which causes a reduction in light below legally acceptable levels will be actionable. In principle, one of the remedies available is an injunction to prevent the obstruction (as well as damages). However, it is a matter for the court’s discretion whether to grant an injunction. Courts have usually been willing to exercise that discretion provided the claimant can establish an actual or potential infringement which goes beyond the trivial (Shelfer v City of London Electric Lighting Company [1895] 1 CH 287).
Recent cases – one way traffic?
A series of cases in recent years have considered the circumstances in which a neighbouring landowner can obtain an injunction to protect his rights to light in the face of an actual or potential obstruction. Until recently, the reported decisions seemed to have been moving very much in one direction – in support of neighbouring land owners.
First there was the case of Regan v Paul Properties Ltd [2006] EWCA Civ 1391 concerning the impact that a mixed-use development would have over light enjoyed by Mr Regan’s sitting room opposite. Mr Regan sought a mandatory injunction to get the offending obstruction removed. Although at first instance the court decided Mr Regan could be adequately compensated by a damages payment, the Court of Appeal disagreed. It determined that the infringement to Mr Regan’s right to light, albeit estimated as a loss of only £5,500, was not a “small injury”. Compare this with the developer’s cost of remedial works to comply with the injunction, which were said to be £175,000.
Then came HKRUK ll (CHC) Ltd v Marcus Alexander Heaney [2010] EWHC 2245 (Ch) concerning the redevelopment of commercial premises next to old Yorkshire Penny Bank in Leeds. The scheme included the construction of two additional floors on the top of the existing building. Mr Heaney, the owner of the old bank premises, alleged that the redevelopment would interfere with the rights to light enjoyed by windows overlooking the new building. The two property owners tried but failed to reach an agreement on how the alleged impact on rights to light would be dealt with. The development was carried out and following completion the developer decided, in the absence of a negotiated settlement, to seek a declaration that Mr Heaney was no longer entitled to an injunction as a result of his acquiescence and delay in issuing proceedings.
In response, Mr Heaney issued a counter claim for an injunction preventing interference with his rights to light. Despite the fact that by this time the building had been fully fitted out and partly let to tenants, the court granted a mandatory injunction which had the effect of requiring the developer to demolish the two additional floors. The estimated cost was said to be around £2.5m.
Heaney established that an injunction may still be available even if sought very late in the day: something of considerable concern to those seeking to manage the risk of rights to light claims in complex development schemes.
Just how broad is the range of circumstances in which an injunction might be granted? And what about the other end of the spectrum? Can it ever be too early to seek an injunction? That was the issue which concerned the court in the recent case of CIP Property (AIPT) Ltd v Transport for London and others [2012] EWHC 259 (Ch). And the conclusion reached may give developers some encouragement that the balance of case law is beginning to shift back in their direction.
CIP Property v Transport for London
The CIP Property case concerned the proposed development of land at Tottenham Court Road underground station. The station forms part of the Crossrail project and extensive construction works are under way below ground. Once they are completed – which is not expected until 2017 – it is also intended that the area above ground at Tottenham Court Road station will be redeveloped.
The area earmarked for redevelopment is owned by the first two defendants, TfL and London Underground. The claimant, a company in the Aviva Investors Group (Aviva), owns a property to the rear of the site, known as 20 Soho Square.
The third defendant, Derwent, enjoys rights of pre-emption to acquire the site for development under an agreement (the pre-emption agreement) which it entered into in 2007. The right of pre-emption is conditional upon satisfaction of a number of prerequisites, including the completion of the below-ground Crossrail works.
The question of how Derwent’s proposed scheme for the site might affect neighbouring buildings had been a matter of discussion between the parties long before proceedings were issued in May 2011. Having entered into the pre-emption agreement in 2007 and worked up initial proposals for the development, Derwent (along with Crossrail) entered into discussions with neighbouring land owners – including Aviva – about the potential impact the development might have on rights to light enjoyed by surrounding buildings. During the course of those discussions Derwent indicated that the proposed development would not proceed without regard to the rights of neighbouring third parties.
By 2011 the below-ground Crossrail works had begun, but plans for the above-ground development were still being finalised. The discussions between Aviva, Derwent and Crossrail had also yet to reach a resolution.
It was against this background that Aviva first threatened and then issued court proceedings claiming that:
? rights to light were enjoyed by 20 Soho Square;
? the development proposed by Derwent would substantially interfere with those rights; and
? an injunction and declaration should be granted to prevent the development being carried out in such a manner as to interfere with those rights.
The defendants’ response was to apply for an order summarily dismissing the application under Part 24 CPR on grounds of prematurity. The crux of the defendants’ argument was that no above-ground development could begin until the below-ground Crossrail works were completed, which was not expected until 2017 at the earliest. Completion of those works was also one of the preconditions (among others) to be satisfied before Derwent would acquire ownership of the site under the pre-emption agreement. Coupled with the fact that no planning consent was yet in place meant that establishing the detail of any development on the site – and what impact it might have on 20 Soho Square – was a very long way off indeed.
Not so, said Aviva. In support of its contention that relief should be granted at this stage, it cited:
? the defendants’ refusal to give an undertaking not to pursue the development without regard to the rights of light enjoyed by neighbouring properties;
? the failure of the without prejudice negotiations;
? the failure of the defendants to allege prematurity until six months after proceedings were first mooted; and
? the failure of Derwent to amend its proposals as to its development scheme in the light of objections advanced by Aviva.
Any delay on its part in bringing proceedings, argued Aviva, might leave it open to allegations of acquiescence to Derwent’s plans at a later date.
The judgement
The case came before the chancellor of the High Court in January 2012, who concluded that, before an injunction or declaration should be granted, “There must be an immediate threat to do something which requires the intervention of the court to prevent it.” On these facts the chancellor decided there was no such threat.
In the case of TfL/London Underground, he concluded that although as landowners they may intend to enter into a development agreement, they would not in fact carry out any works themselves. Nor, on the facts, could they be said to be encouraging or accepting Derwent’s plans in a way that could make them liable for the consequences of the development. They could not then be said to have threatened to infringe Aviva’s rights and therefore no injunction against them was available.
Likewise, there was no immediate threat by Derwent to any rights Aviva might enjoy:
? Derwent did not yet own the site and its future ownership depended on whether Derwent chose to exercise its right to acquire, in addition to overcoming a number of hurdles, including the preconditions set out in the pre-emption agreement. It was clear on the facts that the exercise of this right would not have occurred before 2017;
? Planning permission had yet to be granted, which, given the scale of the proposed project, would undoubtedly take some time to obtain. It would also involve Derwent and Crossrail satisfying any conditions that the local authority chose to impose; and
? Derwent had made it clear that the proposed development would not proceed without regard to the rights of third parties and there was no suggestion by Aviva that these assurances were not genuine.
Nor could the fact that Derwent disputed the existence of Aviva’s rights of light, or the impact which the proposed development might have, amount to an “immediate threat” where none otherwise existed. Similarly, Derwent’s refusal to amend the development scheme or provide the undertaking requested by Aviva did not, of itself, create such a threat.
In concluding that, “There is not now and cannot be for at least five years an immediate threat by the third defendant to infringe the rights to light claimed by Aviva,” the chancellor granted judgment in favour of the defendants.
Fundamental principles
This case serves as a useful reminder that whatever support may be gleaned by landowners from recent case law on rights to light injunctions, the fundamental principles remain. There must be an immediate threat of interference by the developer. And as CIP Property shows, it can sometimes be too early to apply for an injunction.
Perhaps also the case affords a greater window of opportunity to neighbours to discuss how rights to lights issues might be accommodated in development schemes before the threat of injunctive action becomes real.
Alison Oldfield is a partner and Emma Wells a solicitor in the real estate litigation team at Eversheds LLP
