A recent High Court decision is a reminder of how severe the consequences of infringing rights to light can be. Although there is a presumption that an injunction will be granted, courts have often exercised their discretion to award damages rather than a mandatory injunction, particularly in commercial cases. However, in HKRUK II (CHC) Limited v Heaney, an injunction was granted requiring a development to be cut back although it had already been built and let.

The facts

Mr Heaney owns a grade II listed Victorian building used as offices and a conference and banqueting venue. In early 2008, HKRUK II (CHC) Limited, a subsidiary of the Highcross fund, began to redevelop the neighbouring building, Block A, Cloth Hall Court, including the addition of two new floors. Highcross acknowledged that there would be an interference with Heaney’s rights to light and offered compensation calculated in accordance with the conventional “book value” method. The offer was rejected. In November 2008, Heaney threatened to issue proceedings for an injunction but never did so.

In July 2009, the redevelopment was completed and the newly constructed seventh floor was let. A prospective tenant of the sixth floor withdrew because of the light dispute. Following a long period of silence by Heaney, Highcross issued proceedings for a declaration that it had no liability for the interference with Heaney’s rights. As there was no dispute as to the existence of the right or that it had been infringed, the main focus of the case was the remedy.

The principles

In order to rebut the presumption that an injunction should be granted, the developer must satisfy four tests laid down in the leading case, Shelfer v City of London Electric Lighting Company (1895) (see box).

The decision

As to whether the injury was small, the judge considered it “close to the margin”. He took into account that loss of light is relatively less important in commercial premises than residential premises. Overall, however, he did not regard the injury as small taking into account the character of Heaney’s building and the significant investment and commitment he had shown in restoring it.

As one of the Shelfer tests had been failed, an injunction had to be granted; however, the judge went on to examine the other tests in case of an appeal. The claim was capable of being estimated in money. Damages in lieu of an injunction were assessed at £225,000, representing the sum which Heaney could reasonably have demanded for the release of his right to light.

Turning to the final Shelfer test, Highcross’ lawyers listed a catalogue of reasons why an injunction would be oppressive, including the cost of the works (£1.1m to £2.5m), loss of profit (£1.4m), inconvenience to the seventh floor tenant and other occupiers and the tardiness of Heaney in asserting his rights. However, the judge said it would be “wholly wrong for the court effectively to sanction what has been done by compelling the defendant to take monetary compensation, which he does not want”. The infringement was neither trivial nor inadvertent, was committed with a view to profit and was not driven by necessity.

Conclusion

It is never safe to proceed with a development which infringes a right to light. It cannot be assumed that it is just a matter of money. In this case a mandatory injunction was granted despite very serious consequences, and even though the developer had seemingly acted in good faith by keeping the adjoining owner informed, offering to consult and requesting representations at an early stage, whilst in contrast the adjoining owner was extremely slow to take action to assert his rights. Highcross is seeking leave to appeal.

Source: HKRUK II (CHC) Limited v Heaney [2010] All ER (D) 101 (Sep)