Light at the end of the Development

The recent case of of Coventry (t/a RDC Promotions) v Lawrence [2014] UKSC 13 may mean that adjoining owners are less likely to be able to hold up development by pursuing right to light injunctions.

Whilst the Coventry case dealt with the noise nuisance caused by a motocross track, it has implications for any situation where an injunction is threatened by a neighbouring owner to prevent development. The court reversed the trend seen in the most recent major cases on rights of light (Regan v Paul Properties DPF Properties No 1 Ltd [2007] and HKRUK II (CHC) Limited v Heaney [2010]) that an injunction to prevent or, in the Heaney case, demolish a development was the correct remedy unless four conditions (set out in a case heard in 1895), were fully satisfied.

The Supreme court decided that this test was “out of date” and expressed concern that it had been followed so “slavishly” in the Regan v Paul and Heaney cases. Instead courts should use their discretion to determine if the damage could be adequately compensated by a payment. If so then no injunction should be granted.

This may now alter the negotiating position of the parties as an adjoining owner may no longer be able to hold up development with the threat of preventing it in order to extract a larger payment for their co-operation, compared to the previous position when an injunction had a sense of inevitability.

The level of the compensation likely to be payable will vary according to the loss suffered by the neighbouring property, but may well be small in the context of the market value of the proposed development.

It remains to be seen what effect the Coventry case will actually have and clearly there is still risk where the proposed development encroaches on a neighbouring owner’s right to light, but injunctions may become rarer, and negotiations for a settlement easier.