Wrotham Park Estate Company Versus Parkside Homes Ltd - Report Example

Common Law In any lawful nations, the defendants are not supposed to interfere with the claimant’s right and for this reason, an injunction is always put forward to prevent any future interference with the claimant’s rights. In case of any form of interference from the defendant, common law damages are always there to compensate the claimants. These damages are awarded in lieu of an injunction stated under 50 Senior Courts Act 1981, which was once Lord Cairns Act. Under section 50 of this Supreme Court Act 1981, the current replacement to section 2 of Lord Cairns’ Act, the high court has the jurisdiction to entertain an application for a specific performance or injunction; it may award damages in addition to, or in substitution for, an injunction or specific performance. The awards given to the claimant is not limited to loss incurred because of past interference with the right, but also considers loss of future prospect to apply the right. In deciding whether to award damages in lieu with an injunction, the courts have followed the historical case guidelines set out by AL Smith LJ in Shelfer v City of London Electric Lighting Co2. The guidelines provide the guidelines under which the court should award for any damage in lieu of an injunction. Therefore, the courts should only award if the harm to the claimant’s rights is comparatively small, capable of being quantified in monetary terms, and the harm suffered is in a way that it can be compensated by payment of damages and if it would be repressive to the defendant to award an injunction. The circumstances under which equity would award damages in lieu with an injunction is laid down in Smith L. J. good working rules which includes the fact that the injury to the claimant rights was small, could be estimated in small money and could be adequately compensated by payment of small money. This should therefore, be considered as a guideline and not an unbending rule since in most cases when the court deliberates on the nature of the damage, they may have resolved that the level of the damage is small. In this Lord Lindley said that”…ever since Lord Cairns’ Act was passed the Court of Chancery has repudiated the notion that the Legislature intended to turn that court into a tribunal for legalizing wrongful act: or in other words the court has always protested against the notion that it ought to allow a wrong to continue simply because the wrongdoer is able and willing to pay for the injury he may inflict. Neither has the circumstances that the wrongdoer is in some sense a public benefactor (e.g., a gas or water company or a sewer authority) ever been considered a sufficient reason for refusing to protect by injunction an individual whose right are being persistently infringed”. In the case of Wrotham Park Estate Company v Parkside Homes Ltd, as an example of a case in which the court awarded damages in lieu of an injunction, Rose L. J. defended Wrotham Park as a successful attempt to achieve an unbiased outcome in the situations. He argued that in a view of plaintiffs’ objections to what the defendant had done it was unsurprising that substantial damages were awarded in equity as an alternative to a mandatory injunction in Wrotham Park. In this case, two main issues were addressed; the court has no jurisdiction under section 50 of the Supreme Court Act 1981 to award damages in equity in substitution therefore, if there is no ground on which a court can grant equitable relief; secondly, whether in accordance with the user principle or the “just substitute” theory, or otherwise, damages on equity may be awarded on a different basis from common law damage. From these main issues addressed, the possibility is investigated that the Wrotham Park case had been overruled by the final decision of House of Lords in Johnson v. Agnew. Another similar instance of this decision made is in the case of Jaggard v Sawyer, where damages were awarded in lieu of an injunction because; the injury to the claimant was minimal (the additional traffic on the road would merely be for the purposes of accessing one additional hose); also, the injury caused was capable of being quantified in financial terms (namely the expense that would be incurred by the defendant in acquiring a right of way and removing the restrictive covenant, divided between the 10 owners of the private road) and adequately compensated; and lastly, since the complainant had delayed in taking action with the consequence that the house that was the subject of the application had already been built, and that an injunction, would render it worthless by virtue of being landlocked if granted. In the case, it was necessary for the plaintiff to incorporate a claim for an injunction in finding a claim for damages under the act and also it would be similarly ridiculous to require him to include a claim for an injunction if he had taken a realistic approach to the possibilities of obtaining one and intended to apply simply for the damages in lieu. Nevertheless, from the distinction drawn, he ought to make it clear whether he is claiming damages for past injury at common law or both for past and future injury under the Act in substitution for an injunction. In consideration, it is a risk for one to interfere with another person’s rights in assumption that a court will award damages in lieu of an injunction, as in the cases of Mortimer v Bailey; Regan v Paul Properties Ltd and Watson v Croft Promosport Ltd. The outcome that Shelfer has been treated as broadly dogmatic, with these cases defaulting to an injunction unless the defendant could establish all four of the Shelfer conditions. The guideless laid down by Shelfer have got their way through the supreme court and have been used in the case of Coventry v Lawrence, just like Shelfer, Coventry v Lawrence was concerned with the tort of private nuisance, a case where the activities of defendant were believed to have created unreasonable and substantial interference with the use of the claimant land. Addressing the questions related to remedies, the Supreme Court considered a number of issues concerning the law of nuisance. Even though, the comments made by the supreme court in Coventry on the award of damages in lieu of an injunction are most likely to have substantial effects in relation to a broad range of property disputes. The good working rules advanced by AL Smith in Shelfer has played a great role in determining whether a court should award award damages in lieu of an injunction, this has been in place for more than hundred years. But,with the exception of some cases relating to interference with rights to light for example Colls v Home & Colonial Store Ltd; Kine v Jolly; Slack v Leeds Industrial Co-operative Society Ltd; Fishenden v Higgs & Hill Ltd, where the impact of giving an injunction to remedy the interference would have been to require the demolition of the defendant’s building works, the courts have generally applied the cumulative four-part test in Shelfer’s “good working rule” relatively strictly. However, the position of “good working rule” has been weakened significantly by the Supreme Court’s decision in Coventry. Lord Neuberger, who gave the leading judgment in Coventry, argued that in a situation where the claimant has realised that the activities of the defendant interferes interferes with their property rights, the claimant is prima facie entitled to an injunction to prevent continuation of the interference. The burden is on the defendant to show why an injunction should not therefore be given. He also highlighted that the decision to award damages in lieu of an injunction “involves a classic exercise of discretion, which should never be fettered”. He was critical of any mechanical application of AL Smith LJ’s four-part test in Shelfer and concluded that the application of the four tests must not be such as to be a fetter on the exercise of the court’s discretion, secondly in the absence of additional relevant circumstances pointing the other way, normally be right to refuse an injunction if those four tests were satisfied, and lastly, the fact that those tests are not all satisfied does not mean that an injunction should be granted. Lord Sumption and Lord Clarke also argued on Shelfer saying it is out of date. Lord Sumption pointed out that the courts should not grant an injunction in a case where the damage would an adequate remedy, as a matter of fact. He further argues that damages would be adequate remedy in case of nuisance. He went forward by saying that the decision in shelfer was based on the courts objection to sanctioning a wrong by allowing the defendant to pay the right to go on doing it. In his view, this amounted to an “unduly moralistic” approach to dispute resolution. Both Lord Mance and Lord Carnwarth concurred with Lord Neuberger that the Court should take the opportunity to signal a move away from the strict criteria derived from Shelfer. However, they were more careful in rejecting Shelfer altogether. Lord Mance, in particular, argued that “the right to enjoy one’s home without disturbance is one which I would believe that many, indeed most, people value for reasons largely if not entirely independent of money”. He therefore rejected Lord Sumption’s view that damages would ordinarily be an adequate remedy for nuisance. Another crucial factor considered by members of the Supreme Court was the level to which public interest, as a factor should be put into account in deciding whether a grant should be awarded in lieu of an injunction. Most specifically, if a defendant has been granted planning permission to carry out the offending activities, should this lead the court to award damages in lieu of an injunction. In the case of Shelfer v City of London Electric Lighting Co, where the Court of Appeal said that all persons committing a wrongful act whether a private individual or a public company for public purposes, is not therefore allowed to ask the court to sanction his doing so by purchasing his neighbours rights, by assessing damages in that behalf, leaving his neighbour with the nuisance. Lord Neuberger rejected the view when he was speaking in the court. It therefore led to the recognition of the public interest in determining the case by finding it more relevant. Court therefore might take into consideration whether an injunction would mean lost jobs or wasted resources. Furthermore, in the new dispensation the courts discretion is not fettered by the Shelfer rule that claimants were entitled to an injunction unless the injury was small, measurable by money, adequately compensated by money, and it would be oppressive to grant the injunction. The defendant would still have to tolerate a legal burden to enable them show why the injunction should be given and the court should take into account any appropriate matter. However, the Shelfer considerations might be relevant, but they were not decisive, either individually or collectively. Lord Sumption argued that: “There is much to be said for the view that damages are ordinarily an adequate remedy for nuisance and that an injunction should not usually be granted in a case where it is likely that conflicting interests are engaged other than the parties’ interests. In particular, it may well be that an injunction should as a matter of principle not be granted in a case where a use of land to which objection is taken requires and has received planning permission”. Though Lord Neuberger agreed that permission in planning is an important factor to be taken into account, but he declined to endorse Lord Sumption’s radical view. Lord Carnwarth also acknowledged that the grant of planning may be a relevant factor, but he rejected the idea that the grant of planning permission for a particular use should give rise to any presumption against the grant of an injunction. Lord Clarke and Lord Mance did not express any definitive views on this issue.The decision of the supreme court in Coventry was handed down on 26 February 2014, and therefore it has not received much in way of critical commentary. Nevertheless, Martin Dixon has already expressed his views, which are likely to be shared by many property lawyers, by saying that it is apparent that Shelfer is degraded significantly by this decision. Lord Sumption and Lord Clarke would have positively determined that it was outdated had that issue been squarely before them and the remaining three are clear that there has been a shift away from an injunction in favour of damages. For an unrepentant property lawyer, this is hard to swallow: the whole point of proprietary rights, be they of ownership or more limited, is that they are about land use, not land value. They are not mere expressions of a contractual bargain which can be avoided by paying a suitable price. No doubt, changing patterns of land use and land value should always be borne in mind – after all, land law is organic with the law following use and not vice versa. However, if I have an easement I want to use it; if I have the benefit of a restrictive covenant I want to enforce it by stopping the prohibited use, and if a nuisance affects my estate, I want it to stop. In cases of injunctions, much may turn on the behaviour of the parties. If a developer can claim that he has good grounds for believing that no right of light is applicable or that the damage is minimal and an offer of compensation is made, the behaviour may be regarded as sufficiently reasonable to prevent an injunction being awarded. Clearly, injunctions will be awarded if there is actionable nuisance and the developer is shown to have acted with disregard of the rights of the building owner. Developers cannot assume that they will be able to “pay off” any rights of light of adjoining owners; but careful conduct of negotiations ought to avoid the disaster situation, which could result from an injunction. Rights of light must be handled with care and by a demonstration of a reasonable approach by the developer at all times. Read More