The Supreme Court has today, 8 May 2024, unanimously approved the appeal of Davies v Bridgend County Borough Council [UKSC 2023/0028] and decided that whilst the council were in breach of duty for a period of five years, this was not causative of any of the claimant's alleged loss.
DAC Beachcroft were instructed on behalf of Network Rail Infrastructure as intervener in the case, and arguments put forward on behalf of NRI were accepted by the Supreme Court.
Factual Background
In 2004 Marc Davies, the claimant, purchased 10 Dinam Street, Bridgend. In 2017 the claimant became aware of Japanese Knotweed "JKW" on his land. Shortly thereafter he sought damages from the council alleging that, as a result of their breach of duty, the JKW had encroached onto his land and that its very presence caused damage. The claimant sought the cost of the treatment required to control the JKW as well as £4,900 to reflect the alleged reduction in the value of his property caused by the stigma associated with JKW.
In advance of the trial, the claimant accepted that treatment was required before 2004 and therefore dropped this aspect of his claim.
The inconsistency between the claimant's position as to the recoverability of treatment costs and residual diminution caused some consternation, and the matter proceeded through a number of lower court appeals before being heard in front of the Court of Appeal and latterly the Supreme Court.
Position after the Court of Appeal.
The lower courts had found that the council should have instigated treatment on their land from 2013, and that by failing to take steps until 2018, they were in breach of duty for that five year period.
The 2013 date was determined as being a reasonable period of time after the 2012 publication by the Royal Institute of Chartered Surveyors (RICS) of their guidance paper that detailed the risk of damage that it was thought JKW posed to buildings and the need to treat and or control JKW.
The Court Of Appeal found in favour of the claimant and determined that as the council were perpetrating a continuing nuisance they could recover their residual diminution as this ongoing breach was the cause of the harm persisting.
The issue in front of the Supreme Court
The appeal focused on the narrow issue of causation and the question of "was the residual diminution in value caused by the defendant's breach of duty in private nuisance."
It was accepted that JKW had existed on 10 Dinam Street before 2004 and that the council were only in breach between 2013 and 2018.
The council argued that any residual diminution was caused by the first encroachment of JKW as this was the cause of any stigma; the stigma arose from the fact there had been any JKW on the site and it was a binary consideration.
It was the council's position that as the first encroachment occurred before breach of their duty, it must be the case that the loss was not caused by said breach; even if the council had not been in breach of duty at all, the claimant's losses would still have been as pleaded.
The claimant contended that the residual diminution in the value of their property was caused by the breach of duty as any treatment by the claimant would have been futile and that the defendant should not be absolved from liability caused by this breach of duty either in full or in part. Alternatively, without the continuing breach of duty, the amount of stigma would have reduced as it would have become increasingly historic.
The Decision
The Supreme Court ruled that as it was common ground that the JKW first encroached upon 10 Dinam Street sometime before 2004 (the date of purchase by the claimant) and crucially before the council should have taken action in 2013, the losses were associated with there being JKW on the claimant's land; the breach between 2013 and 2018 was not material.
The claimant failed to evidence that there was any increase in the level of loss as result of the breach of duty from 2013 to 2018 (or that the breach caused the loss to 'freeze').
It was held on the facts that had the council not been in breach of duty, the residual diminution would have been at the same level as it could not have diminished by action or time.
Consequences
This should be a reassuring judgment for landowners as the Supreme Court have now conclusively dispelled any suggestion that the burden of compensating a claimant for all of the financial consequences of there being JKW on the claimant's land falls to the defendant simply because they were, at one time, in breach of their obligations in respect of treating and controlling the JKW on their own land.
The extent of a defendant's liability will be limited to the losses that are identifiably caused by the breach of duty, this might include an increase in treatment costs and/or increased residual diminution where such increase can be attributed to the breach of duty.
It remains to be seen the extent to which the court will distinguish between new encroachment and natural expansion of JKW already within the claimant's land and the extent to which the latter is attributable to any ongoing breach of duty. This will be a matter of expert opinion and will be fact sensitive.
Lessons for landowners
It remains crucial that land owners instigate reasonable treatment programmes once they are aware of JKW on their land.
Whilst not an issue in front of the Supreme Court, it remains highly likely that landowners will continue to be held to be in breach of duty for not treating JKW that they ought to have known about but in fact did not.
There is no guidance as to precisely what steps defendant's must take to pro-actively identify JKW on their land, but the lower courts found the council should have known about the JKW around 12 months before they actually did as they should have pro-actively looked for it. This will likely be a fact focused issue with significant consideration also given to the nature and financial means of the landowner.
Claimant's will have difficulty in attributing any losses to a breach of duty where the first encroachment of JKW materially pre-dates the RICS report of 2012.
The area of contention will now likely refocus on issues of limitation and the issue of proactive identification of JKW and whether this is a requirement to avoid liability.
Our Subsidence Team deals with cases like this on a regular basis. For more information or advice, please contact one of our experts.
