Summary: In the recent rights of light case of Ottercroft v Scandia the Court of Appeal upheld an injunction against a developer. The court decided that the developer’s high handed behaviour and its breach of an undertaking not to interfere with its neighbour’s light outweighed the fact that the loss was relatively minor and capable of being compensated by a small money payment.

Background

The developer Scandia carried out a small mixed use development in High Wycombe, comprising a ground floor café with residential flats above. As part of the development Scandia replaced an existing wooden staircase that serviced the residential flats as a fire escape, with a new metal staircase.

Ottercroft owned a neighbouring restaurant and complained that the new metal staircase obscured the restaurant’s kitchen windows and blocked its light.

Ottercroft sought an injunction requiring the removal of the staircase. Scandia conceded that the staircase infringed Ottercroft’s light and the question for the court was whether an injunction was appropriate or whether damages would do.

Injunction v Damages

The impact to Ottercroft’s light had been valued at £886 whereas the cost to Scandia of removing and relocating the staircase was in the region of £6,000. At first glance, you might think that the injury to Ottercroft could be characterised as minor, that it could be compensated by a small money payment, and that an injunction would therefore be unduly oppressive. But the Oxford County Court (and subsequently the Court of Appeal) did not see it that way.

In exercising his discretion, the County Court judge placed significant weight on the conduct and attitude of Scandia and in particular one of its directors, Dr Rahimian, who effectively controlled the company. In particular, the judge found that:

  • Dr Rahimian had acted in an unneighbourly and high handed manner throughout. He had been aware that the construction of the staircase would infringe Ottercroft’s light but went ahead regardless, even after Ottercroft had threatened legal proceedings; and
  • In spite of undertakings given by both Scandia and Dr Rahimian not to interfere with Ottercroft’s light, they went ahead and built the new staircase in breach of these undertakings, deliberately picking a time when they knew that the neighbouring premises were vacant, and without informing Ottercroft.

Therefore, in spite of the relatively minor loss of light, the judge ordered a mandatory injunction requiring Scandia to remove or alter the staircase.

Appeal

Scandia and Dr Rahimian appealed. They asserted that in exercising his discretion, the Judge was required to balance his criticism of Dr Rahimian’s behaviour against the oppressive effects of an injunction, and he had failed to carry out this balancing exercise genuinely, proportionately and objectively because he was so overwhelmed by the way in which he chose to characterise Scandia and Dr Rahimian. Further, they asserted that the Judge had not factored in the cost or feasibility of a mandatory injunction and had made a whole series of unfounded assumptions upon which he based his decision.

Lord Justice Lewison handed down the Court of Appeal’s ruling without even needing to hear from Ottercroft's legal team. He concluded that:

  • Scandia's and Dr Rahimian's arguments in support of their appeal were largely irrelevant given their admission that the new staircase did infringe Ottercroft’s rights of light;
  • There was evidence that it was feasible to move the staircase, albeit at a cost of around £6,000; and
  • The Judge was entitled to consider Scandia's and Dr Rahimian’s conduct in the round and was not wrong to exercise his discretion on the basis of such conduct. Scandia and Dr Rahimian had acted in a high-handed manner and had tried to steal a march. An injunction was necessary not only to do justice to Ottercroft but also to serve as a warning to others.

The appeal was unanimously dismissed and the injunction was upheld.

In the 2014 case of Coventry v Lawrence, the Supreme Court reconsidered the correct approach to the exercise of the court’s discretion to grant an injunction or damages and recommended a more flexible approach. There have been few cases since Coventry to demonstrate this shift in approach, and the decision in Ottercroft v Scandia has therefore been eagerly awaited.

Although on superficial analysis the case might ring alarm bells for developers (on the basis that an injunction was granted for a relatively minor impact and where the offending structure was an essential fire escape staircase), on closer examination the result was predictable and turned entirely on the particular facts of the case and the extreme nature of the developer’s conduct in breaching undertakings and secretly commencing works.

Nevertheless there is a clear and loud broader message here for developers. Be aware that should you end up in court, your behaviour will be interrogated and you must be able to show, at the very least the absence of a cynical and high handed attitude, and preferably conduct that is impeccable under scrutiny.

One final general point is that there may be circumstances where, before making any concessions as to the existence of a rights of light infringement, developers should consider if there could be any wider arguments available to them, for instance that the loss of light does not interfere with the natural use and enjoyment of the room and therefore does not constitute a legal nuisance. It may well have been improper to raise such an argument in this particular case, but there will be circumstances where developers would be well advised to think carefully before making any admissions based solely on the narrow technical data.

Ottercroft Limited v Scandia Care Limited and Dr Mehrdad Rahimian (B2/2015/1149) was heard by the Court of Appeal on 6 July 2016. The decision is currently unreported.