Rights of light are coming further and further into the spotlight as urban development space remains at a premium, forcing schemes to get taller and closer. Whilst sounding fairly antiquated, rights of light can cause modern day headaches if they are not considered and dealt with at an early stage.
There have been several important cases in the past few years which have dealt with rights of light issues, the most recent being a Court of Appeal decision in the last month or so. They all highlight the fact that, whilst the court’s decision will always be grounded in the legal position, it will look at the type of premises involved and the conduct of the parties in question when coming to its decision.
In 2005 (Midtown Ltd v City of London Real Property Co Limited) the court decided that, due to a variety of factors, an injunction preventing a development which reduced the amount of light received by nearby office premises would have been disproportionate and awarded damages to the claimant instead. Amongst the reasons for the decision were the facts that the premises were commercial offices and that the freeholder’s and tenant’s interests in the property were financial. As a result, the court felt that any diminution in value or light (as artificial lighting in offices is standard) could be adequately compensated for by a financial payment - it was fairly scornful of the tenant’s odes to the joys of natural light as a light source. The court also noted that the defendant developer had flagged the right of lights issues with the freeholder and the tenant at the start of the matter but had been ”rebuffed unreasonably” by them both.
This case was followed in 2006 by Regan v Paul Properties DPF Number 1 Limited, where the court required a developer to pull down an offending part of its building (at an estimated cost of around £175,000) due to that caused a reduction of light that diminished the claimant’s property value by £5,000. Here, the affected property was residential and the owner had objected to the scheme at an early stage. However the developer, who had been incorrectly advised by its surveyor that the development would not have an actionable effect, pushed ahead with the development. The court confirmed that an injunction was a prima facie right for an offended party and that it would look at all surrounding circumstances and the parties’ conduct when deciding if an injunction was appropriate. It felt that the claimant should not be forced to accept damages and a lower level of light simply because the developer had taken a calculated risk and completed the construction before the dispute had been settled.
This year, in RHJ Limited v FT Patten (Holdings) Limited and Others, the Court of Appeal found that a general reservation of a right to develop an adjoining site contained in a lease was enough to prevent the building from acquiring prescriptive rights of light over the relevant site despite not specifically referring to such rights. The action appears to have been prompted by the developer serving a right of light obstruction notice on the relevant property which then brought the issue into the open.
Developers must therefore still tread carefully as, no matter how far down the line a scheme is, the court can still require the work to be undone, even for what the developer might perceive to be a minor slight. It is therefore always a good idea for a developer to consider rights of light at an early stage of any proposed scheme and, if necessary, to take appropriate action as soon as possible - such as serving a right of light obstruction notice to try and flush out any problems.