A Warrington couple today succeeded in a test case against the Coal Authority over compensation for subsidence to their former home.
Today’s majority ruling in the Court of Appeal could pave the way for many similar claims.
The appeal stemmed from a Lands Tribunal decision in March 1998. The tribunal held that it had no power under the Coal Mining (Subsidence) Act 1957 to award the couple damages for depreciation in the value of their property caused by mining subsidence.
The couple – Mr and Mrs McAreavey – said their home was damaged after British Coal, predecessors to the Coal Authority, withdrew support after ceasing mining in their area in 1991.
The authority offered to carry out work to remedy the damage, but the couple demanded instead that the authority should buy the bungalow in its damaged condition.
Before the damage the bungalow had been valued at £115,000. But when the McAreaveys finally sold the bungalow in 1994, they could only get £40,000 for it. The balance of £75,000 was paid by their building insurers who exercised their right of subrogation and launched the court proceedings. The property was eventually demolished by a subsequent purchaser.
Challenging the tribunals refusal to award compensation for diminution in value, Robert Moxon Browne QC argued that there was no policy or other reason why recovery of damages should be precluded under the Act. Nor was there anything in the Act to suggest that it should be construed in a “peculiarly restrictive way”. He argued that if the claim had been brought in tort or contract, damages for diminution in value would have been readily recoverable.
However, counsel for the Coal Authority, Stephen Grime QC, argued that if the dispute had been referred to the tribunal while the bungalow was still standing, the tribunal could have required the authority to carry out remedial works. But, he said, it was not possible for the tribunal to order the authority to purchase the bungalow or to require payment of a sum equal to depreciation in value.
Today Ward and Clarke LJJ backed the appellants, with Peter Gibson LJ dissenting.
Ward LJ said: “The tribunal are empowered to award damages for the loss caused by the subsidence. The [National Coal] Board is not confined to a loss caused by a delay in carrying out repairs. Nor is it confined, as the tribunal member held, to damages that are subsidiary to the primary remedy of remedial works.”
McAreavey and another v Coal Authority, Court of Appeal (Peter Gibson, Ward and Clarke LJJ), 19 July 1999
Robert Moxon Browne QC and Patrick Walker (instructed by Beachcroft Wansbroughs, of Leeds) appeared for the appellants; Stephen Grime QC and Ruth Trippier (instructed by Nabarro Nathanson, of Sheffield) appeared for the respondent.
PLS News 19/07/99
