Town & Country Planning Act 1990 s237 : Extinguishment of Rights of Light – II 2 Comments

Town & Country Planning Act 1990 s237  : Extinguishment of Rights of Light – II

Proposition:  When land is appropriated, rather than acquired, by a local authority which then exercises its power to extinguish rights enjoyed by the owners of adjacent properties, it is hard to see what remedy the dominant owner could have, other than the right to receive compensation for injurious affection.

In my last blog post on this subject (Town & Country Planning Act 1990 s237 : Extinguishment of Rights of Light) I proposed that it is unlikely that the owner of a building whose right to light is extinguished under S.237(1) of the Town & Country Planning Act 1990 could at that stage apply for a judicial review, but that judicial review might well be available on the making (and confirmation) of the underlying Compulsory Purchase Order under s.226(1).

But what if the local authority already owns the land to be developed, having originally acquired it for another purpose, and resolves to appropriate the land for use for planning purposes?  I pointed out in my earlier blog that where a local authority is acquiring land under s.226(1)(A) of the 1990 Act, the power cannot be exercised unless the local authority thinks that the development, redevelopment or improvement is likely to contribute to the achievement of the objects there specified.

Rights to Light

I also quoted the Encyclopaedia of Planning Law and Practice (Sweet & Maxwell) which expressed the view that the use of the word “think” in s.226(1)(1A) does not exempt the decision making process from the normal criteria of control applied by the courts in judicial review.  I do not think the same applies where the local authority in question is exercising a power of appropriation.

Plowman J in Dowty Boulton Paul Ltd v Wolverhampton Corporation (2)  Same v Same [1970] D. No. 2636 [1971 D. No. 345] noted:- “It is well settled that, in the absence of statutory authority, land of a local authority appropriated for one purpose cannot be appropriated to another purpose …”.

The learned judge referred to the cases supporting this statement but since the coming into force of s.23 of the Town & Country Planning Act 1959 and s.122 of The Local Government Act 1972 there will be few cases where there is not statutory authority.  Quoting the section:-

23.      Exercise of Power of Appropriation

(1)           subject to the following provisions of this section, whereby any enactment :-

(a)           power is conferred on any authority to which this Part of this Act applies, or on any class of such authorities, to appropriate land for any purpose, whether the purpose is defined in the enactment specifically or by reference to some other power exercisable by the authority or class of authorities in question, but

(b)           that power is so conferred subject to a provision (in whatever terms the provision is expressed, and whether it is contained in the same or in any other enactment) that the power is not to be exercised except with the consent of a Minister specified in that provision, or for a purpose approved by a Minister so specified, with or without a further provision enabling conditions to be imposed by such a Minister in respect of the exercise of the power,

the enactment shall have effect, in relation to the exercise of the power after the commencement of this Act by an authority to whom this part of this Act applies, as if it conferred that power free from any such provision as is mentioned in paragraph (b) of this sub-section”.

There are limited exceptions in relation to commons, smallholdings and allotments.

In the situation envisaged here, s.23 is not actually needed, as s.122 of the Local Government Act 1972 confers power on most local authorities to appropriate “for any purpose which the council are authorised by this or any other enactment to acquire land by agreement any land which belongs to the council and is no longer required for the purpose for which it is held immediately before the appropriation; but the appropriation of the land by a council by virtue of this subsection shall be subject to the rights of other persons in, over or in respect of the land concerned”.

Rights to LightThe authorisation to acquire by agreement land for planning purposes is to be found in s.120(1) of the Local Government Act 1972.  The result is that no ministerial approval is required for an appropriation of already owned land for planning purposes.  Consequently, there will be no opportunity to challenge a CPO; is any other remedy available e.g. judicial review?

The answer I think is “no”; the power of appropriation conferred on councils by s.122(1) of the LGA 1972 requires only that the land “is no longer required for the purpose for which it is held immediately before the appropriation” and it is quite clear from the Dowty Boulton Paul Ltd case that the decision of the council as to whether land is required for a particular purpose cannot be challenged in the absence of bad faith (which was claimed in Dowty Boulton Paul Limited but robustly rejected by the judge).

The power to extinguish adjoining owners’ rights is of course conferred by s.237 of the Town & Country Planning Act 1990, and the only requirements are that the land has been appropriated for planning purposes and that planning permission is granted.  Given the finality of the appropriation it is hard to say on what basis a resolution to appropriate under s.237 could be challenged.

The principal significance of this for present purposes is that it enables a local authority to extinguish the rights of light of adjoining owners without the possibility of challenge and subject only to the obligation to pay compensation under s.237(4).  So far as compensation is concerned, the references to s.63 and s.68 of the Lands Clauses Consolidation Act 1945 and s.7 and s.10 of the Compulsory Purchase Act 1965 make it clear that what is required to be paid is compensation for injurious affection.  This has been very recently confirmed by the Lands Chamber of the Upper Tribunal in Holliday V Breckland District Council [2012] UKUT 193 (LC) where the claimant was an adjoining owner, one of whose rights of access to his property was extinguished under s.237.  The claimant sought compensation under s.237 for the interference with his easement; the Tribunal noted that by s.237(4) such compensation was payable in accordance with the statutes referred to be assessed “in the same manner and subject to the same rules as in the case of other compensation under those sections in respect to injurious affection”; see s.237(4)(b).

The claimant, however, contended that he was additionally entitled to compensation under s.63 of the 1845 Act, for the “taking” of his right of way, based on its market value; he contended that this included a “ransom value” representing the amount that he could have extracted, as a proportion of the development value of the Council’s land, in return for agreeing to the extinguishment of the easement.  In cases based on nuisance, such additional damages are sometimes awarded under the Chancery Amendment Act 1858 s.2, known as Lord Cairns’ Act.  The claimant is awarded a sum equivalent to that which he would notionally have agreed to accept in reasonable negotiations for the release of his right before proceedings were commenced.  The Tribunal robustly rejected this additional claim.

Applying this to a rights of light situation, the huge sums which are sometimes paid by developers by way of compensation for the extinguishment of light do indeed represent “ransom value” as the developer is in effect “buying off” the dominant owners’ potential right to an injunction.  Where a local authority uses the appropriation route, it is clear that there will be no additional element to represent what might otherwise be an entitlement to an injunction ; the only thing the dominant owner is entitled to is an amount equal to the diminution in value of his property as a result of the loss of light.

Waldram diagramIn negotiations between dominant and serviant owners of land, compensation for rights of light is usually calculated by rights of light experts by measuring and valuing the loss of light in a technical way by reference to what is called a “Waldram diagram”.  Whether this valuation method would be regarded as final in the calculation of compensation under s.237 is perhaps doubtful; I would welcome views on this from rights of light surveyors.  If the method is the only accurate way of determining diminution in value then perhaps it will apply; but the key question is the extent to which the market value of the dominant tenement is reduced by the extinguishment.

There is one further issue which may be worth dealing with here as it is important in the context of the application of s.237.  In Thames Water Utilities v Oxford City Council [1999] 1 E.G.L.R. 167 it was held that the express words in s.237 did not justify impliedly overriding an adjoining owners’ rights by a material change of use as distinct from the carrying out of works etc. as stated in s.237; in other words, s.237 applied to extinguish (in that case) a restrictive covenant solely for the purpose of enabling the development to be constructed but did not apply to extinguish the covenant so far as the future use of the developed building was concerned.

This decision was the subject of a very interesting article by Laurie Heller in Practical Conveyancing.  Mr Heller suggested that, in principle, the decision in Thames Water will apply not only to restrictive covenants but also to easements.  This led in August 2007 to the publication of a Consultation paper by the Department for Communities and Local Government.  The paper appears to agree with Mr Heller’s view in stating that “This means that the easements and other rights can only be overridden during construction and not permanently for the new use of the site”.  The paper proposed the amendment of s.237 to overcome this problem but no new legislation has been brought into effect as yet.

I find it hard to see how this interpretation of s.237 can be applied to the extinguishment of a right of light.  Once a right of light is extinguished it has gone; the alternative view would be nonsensical as it would mean that the dominant owner could wait for the new building to be constructed by the local authority or its successor in title and then seek an injunction for the building’s removal – surely that cannot be right?

Rights of LightConclusion:  Dominant owners whose rights of light are extinguished under s.237 of the Town & Country Planning Act 1990 following the appropriation of the development site by a local authority will not have any remedy other than a right to receive damages based strictly on the diminution in value of their land (with no additional element to reflect their loss of the right to apply for injunctive relief).

If you liked this article, please share it.

This Post Has 2 Comments

  1. raymond cooper says:

    Michael’s comment is very helpful. What Michael refers to as the “Carr-Saunders Multiplier” is I think the same as the additional claim which the Lands Chamber rejected in Holliday v Breckland District Council (quoted above). The expression originates from the case of Carr-Saunders V Dick McNeil Associates Limited [1986] 2 All ER 888. Michael’s comment confirms my view that compensation under s.237 is strictly diminution in value only.

  2. Michael Ney says:

    The use of the Waldram Diagram on its own is of no direct relevance to evaluating a claim for damages by loss of light. The Diagram, or more correctly, a series of them enables a contour of points within a room where 1/500th of the dome of the sky can be seen from the working plane (usually 850mm above floor level). By doing a series of diagrams before and after, the two contours are produced. The tabular data is then usually put into an EFZ table in which the gravity of the losses can be assessed. If the losses are in the zones below 50% of the space remaining adequately-lit, then an actionable loss occurs. By using the weighting of the losses and the assessment of the Light Standard Rental, the “book value” for the loss can be established and that is probably the “diminution in value” that the Lands Chamber would award. The Chamber would be likely to ignore the uplift implicit in the “Carr-Saunders Multiplier” necessary to persuade the dominant owner to sell out his easement where he has the ability otherwise to seek an injunction. The Waldram Diagram is a valuable tool in the preparation of the contour diagram and from that to the EFZ table but it is only a tool along the way.

Leave A Reply

Please fill out the required fields *