Many building projects are carried out in crowded city areas, requiring a balance to be struck between the interests of progressing the work and the effects on adjoining owners. In the recent case of Hiscox v The Pinnacle (25 January) the Chancery Division regarded an injunction, rather than a contractual agreement, as the most suitable method of protecting an adjoining owner's interests.
The case concerned a substantial redevelopment involving demolition by developers at Bishopsgate in the City of London. The claimants' office buildings adjoined the site and, by the time the case reached Court, there had already been an acrimonious history of discussions between the parties. This led to an agreement between them on a "standstill" basis, limiting the duration and scope of works, in particular so as to reduce vibration. Acceptable levels of vibration were defined in the agreement.
After the agreement was entered into, the claimants contended that the agreed vibration limits had been repeatedly broken, and they eventually sought an interim injunction to require the developers to adhere to the agreed vibration limits.
Since any full trial of the matter would not take place until after the building was demolished, the Court was effectively required to decide, so far as it could, the merits of each party's case. In doing so it reviewed the law in relation to nuisance as it affects building contracts. It accepted that, whilst in most cases projects involving ordinary building works must be allowed to proceed rather than be halted, all proper and reasonable steps must be taken to ensure that no undue inconvenience amounting to nuisance is caused to neighbours. If such reasonable steps are taken by the developer, then those steps may form a defence to any claim in nuisance. However, once undue inconvenience is shown, it is for the developer to demonstrate that he took all reasonable and proper steps to avoid it. In this regard, "reasonable steps" are not to be equated with "best" or "all reasonable" endeavours, as the latter represent more onerous obligations.
In deciding the issue, the Court accepted that the previously agreed vibration levels struck an appropriate balance between the parties' interests but that the developers had not taken all proper and reasonable steps to avoid them being exceeded. The defendants said that various difficulties would arise as regards enforcement of an injunction prescribing vibration levels. In particular, the developers would not know until after the event whether they were in breach of the Court's Order. The Court dismissed this argument on the basis that the developers could readily monitor vibration caused by their works. Any breach could result in a responsible person within the developers' organisation being committed to prison. In the light of such a severe sanction, the Court would apply the criminal standard of proof as to whether a breach had occurred so that any reasonable doubt would be resolved in favour of the developers and their representative.
The Court held that it was justified to grant an injunction on the basis that the balance of convenience was in favour of this remedy and the claimants had a sufficiently strong case to justify it. The developers' offer to enter into another agreement so as to extend the "standstill" agreement was rejected. The Court observed that there was no certainty that this would be effective as that agreement had not operated to prevent the agreed vibration levels being exceeded in the past. Instead, an injunction would be granted to the effect that, if there were any breach, the developers would need to prove they had used all proper and reasonable steps to prevent such an excess occurring.
It seems likely that the developers' conduct counted against them in respect of the period when the "standstill" agreement applied. The Court appears to have regarded an undertaking to enter into a further agreement as insufficient in lacking suitable coercive powers and deterrent effect when compared to an injunction. Developers should therefore strive to avoid a similar result by seeking to agree suitable noise and vibration levels with the adjoining owners before work commences with specific procedures and/or sanctions for non-compliance. While these would not preclude the possibility of an injunction if such maximum levels were not adhered to, the Court is likely to be less ready to grant an injunction if the parties have already anticipated this scenario. However, even if an injunction is granted, the Court is unlikely to include within the injunction any greater obligation than to take all reasonable steps not to exceed the relevant noise or vibration limits.