![]() |
[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback] | |
England and Wales Court of Appeal (Civil Division) Decisions |
||
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Langley & Ors v Coal Authority [2003] EWCA Civ 204 (21 February 2003) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2003/204.html Cite as: [2003] EWCA Civ 204 |
[New search] [Printable RTF version] [Help]
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE LANDS TRIBUNAL
Strand, London, WC2A 2LL |
||
B e f o r e :
LORD JUSTICE MANCE
and
MR. JUSTICE HOOPER
____________________
LANGLEY AND OTHERS |
Respondents |
|
- and - |
||
THE COAL AUTHORITY |
Appellant |
____________________
Smith Bernal Wordwave Limited, 190 Fleet Street
London EC4A 2AG
Tel No: 020 7421 4040, Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
Mr. Paul Darling Q.C. (instructed by Messrs DLA of Sheffield) for the Appellant
____________________
AS APPROVED BY THE COURT
CROWN COPYRIGHT ©
Crown Copyright ©
Peter Gibson L.J.:
Legislative history
The 1991 Act
"(1) Subject to and in accordance with the provisions of this Part, it shall be the duty of the [Authority] to take in respect of subsidence damage to any property remedial action of one or more of the kinds mentioned in subsection (2) below.
(2) The kinds of remedial action referred to in subsection (1) above are—
(a) the execution of remedial works in accordance with section 7 below;
(b) the making of payments in accordance with section 8 or 9 below in respect of the cost of remedial works executed by some other person; and
(c) the making of a payment in accordance with section 10 or 11 below in respect of the depreciation in the value of the damaged property."
"(1) As soon as reasonably practicable—
(a) after receiving a damage notice;
….
the [Authority] shall give to the claimant, and to any other person interested, a notice indicating whether or not they agree that they have a remedial obligation in respect of the whole or any part of the damage specified in the damage notice. (2) Where the [Authority] give a notice under subsection (1) above indicating their agreement that they have such an obligation, they shall also give to the claimant, and to any other person interested, a notice—
(a) stating the kind or kinds of remedial action available for meeting that obligation and, if more than one, which of them the [Authority] propose to take; and
(b) in the case of a notice stating that the [Authority] propose to execute remedial works with respect to any damage, informing the claimant or that person that, if he makes such a request as is mentioned in section 8(3) below, the [Authority] may elect to make a payment in lieu instead of executing the works.
(3) Where the [Authority] accede to any such request, they shall give to the claimant and any other person interested a revised notice under subsection (2) above stating that they propose to elect to make a payment in lieu instead of executing the works."
"(a) the works which the [Authority] consider to be remedial works in relation to the damage, that is to say, such works (including works of redecoration) as are necessary in order to make good the damage, so far as it is reasonably practicable to do so, to the reasonable satisfaction of the claimant and any other person interested; and
(b) in the case of each item of those works, the amount of the cost which the [Authority] consider it would be reasonable for any person to incur in order to secure that the work is executed."
The Authority are further required to send with the schedule a notice stating that if the claimant does not agree with the schedule, he should notify the Authority within 28 days, and if such notification is given, the matter can be referred to the Lands Tribunal. The schedule comes into effect if no such notification is given at the end of the 28-day period, and in any other case when the schedule is agreed and determined by the Lands Tribunal.
"(1) In any case to which this section applies the [Authority] may elect to make a payment equal to the amount of the depreciation in the value of the damaged property caused by the damage ("the depreciation amount") instead of executing any remedial works or making any payment in lieu.
(2) This section applies to the following cases—
(a) where the aggregate amount of the costs specified in the schedule of remedial works exceeds the depreciation amount by at least 20 per cent…."
"Where in the case of any property affected by subsidence damage—
(a) remedial works have been executed; but
(b) there is a depreciation in the value of the property caused by any damage the making good of which to the reasonable satisfaction of the claimant and any other person interested was not reasonably practicable,
the [Authority] shall make in respect of the property a payment equal to the amount of that depreciation."
"(1) For any purposes of section 10 or 11 of this Act, the value of a unit of property at any time shall be taken to be the amount which it might be expected to realise in the state in which it is at that time on a sale effected at that time.
(2) In the case of property comprising land or buildings the sale referred to in sub-paragraph (1) above is a sale of the fee simple in the open market and with vacant possession…."
"For the purposes of section 10 or 11 of this Act the amount of the depreciation in the value of a unit of property caused by any subsidence damage shall be taken to be the amount by which the value of the property at the relevant time is less than what would have been its value at that time (determined in accordance with paragraph 2 above) if it had not been affected by the damage."
The relevant time for the determination of a depreciation payment under s. 10 is the time immediately after the date on which the Authority give to the claimant a notice of proposed remedial action. In relation to the determination of a s. 11 (3) depreciation payment the relevant time is the time immediately after the completion of the remedial works.
"(1) Except as otherwise provided by or under this Act, any question arising under this Act shall, in default of agreement, be referred to and determined by the Lands Tribunal.
(2) Where in any proceedings under this Act the question arises whether any damage to property is subsidence damage, and it is shown that the nature of the damage and the circumstances are such as to indicate that the damage may be subsidence damage, the onus shall be on the [Authority] to show that the damage is not subsidence damage.
(3) The tribunal, court or other person by whom any question is heard and determined under this Act may make such orders as may be necessary to give effect to its or his determinations and in particular may by order—
(a) require the [Authority] to carry out any obligations imposed upon them by this Act within such period as the tribunal, court or person may direct;
(b) award damages in respect of any failure of the [Authority] to carry out any such obligations."
The facts
The President's decision
The 7 High Street properties
Table 1: Claims and offers |
Table 1: Claims and offers |
Table 1: Claims and offers |
Table 1: Claims and offers |
High Street number |
1 Claim (depreciation) £ |
2 Coal Authority offer (depreciation) £ |
3 Coal Authority cost of repairs £ |
37 | 125,000 | 3,000 | 21,437 |
39 | 100,000 | 6,800 | 20,458 |
45 | 27,500 | 1,000 | 18,008 |
47 | 110,000 | 29,000 | 63,161 |
49 | 90,000 | 2,200 | 36,944 |
51 | 67,500 | 100 | 11,823 |
55 | 160,000 | 400 | 26,017 |
(1) in respect of damage to dwelling-houses the Authority should pay the cost of remedial works;
(2) in respect of damage to land the Authority should carry out a regrading scheme (or, in the case of no. 55, the Authority should insert soil nails) to prevent further ravelling of the face of the cliff;
(3) the Authority should also make a depreciation payment under s. 11 (3) to each owner in respect of the residual depreciation in value of the property from damage which it was not reasonably practicable to make good.
The reason for that third element was because it was acknowledged that the regrading would not restore the garden level to its previous position but would leave a steeper slope.
Table 2: Agreed costs of remedial works to land
High Street number |
Cost of works £ |
37 | 21,437 |
39 | 13,958 |
45 | 12,008 |
47 | 30,595 |
49 | 27,994 |
51 | 11,823 |
55 | 12,500 |
To these costs were later added further costs and fees and the costs of the removal of greenhouses and outbuildings, all of which were taken into the total costs to which I refer in the table in para. 34 below.
High Street number |
9 Total costs £ |
37 | 43,446 |
39 | 39,551 |
45 | 43,058 |
47 | 86,577 |
49 | 57,008 |
51 | 25,291 |
55 | 38,205 |
Much of the material which went into that table had been agreed by the experts.
"What I cannot accept, however, is that the amount of the depreciation in the values of these properties for the purposes of the 1991 Act is to be measured by deducting these "in present circumstances" values from the agreed "without the landslip" values. Under para. 3(1) of Schedule 1 the amount of the depreciation is the amount by which the value of the property is less than what would have been its value if it had not been affected by the damage. What has to be left out of account in making this comparison is not the effect on value of the landslip but the effect on value of the damage to the particular property under consideration. The measure of depreciation is the effect that the damage suffered by the property had in terms of the value of the property."
Something has gone wrong in the third sentence of that paragraph, but the conclusion in the final sentence is clear.
"72. The landslip covered a substantial area of the Back Hills as well as properties in High Street and New Station Road, a number of which had to be demolished. The evidence is that this affected house prices in Bolsover over quite a wide area, and that many houses, physically unaffected in any way by the landslip, had their council tax bandings reduced in recognition of this. The reason for these falls in value was that the landslip created in the minds of prospective purchasers the fear that the houses might be damaged by some similar occurrence in the future. This is the effect that has been referred to as blight.
73. What the valuer has to do in determining the amount of depreciation under the Act in the present case, in my judgment, is to disregard this general blighting effect that the landslip has had and to decide how much less the property is worth in its damaged state than it would have been worth undamaged. If, undamaged, it would have been worth less by reason of this general blighting effect, that reduced value is its undamaged value for the purposes of the Act. The amount of depreciation is the difference between this value and the actual value of the property in its undamaged state.
74. If the effect of the damage to the property is to create in the minds of prospective purchasers, their advisers and insurers and mortgages, the fear that further damage might be suffered in future, I see no reason, either on the basis of the wording of the Act or in the light of its purposes, why this should not be taken into account if it is a factor that in practice diminishes the value of the property. I therefore dismiss the approach adopted by the Authority, who say that the fear of future damage must always be entirely discounted in measuring depreciation. In the case of each of the High Street properties I am satisfied that the damage to the land, which has left what Mr. Fisher calls a cliff face with a fissure across the remaining higher ground, has substantially reduced the value of the property. This is due not only to the unsightliness and the hazards that have resulted and the loss of usable land, but, more significantly, to the doubts that the damage creates in the mind of prospective purchasers and their advisers as to the future stability of the land on which the house stands. I am satisfied that the removal of the visible outward signs of damage will substantially remove the reduction in value that has occurred. This is a matter that I return to later."
In existing state | After re-grading | After re-grading | After re-grading | |
High Street number | Mr. Fisher £ |
Mr. Trussell £ |
Mr. Fisher £ |
Mr. Trussell £ |
37 | 16,000 | 3,000 | 16,500 | Nil |
39 | 11,750 | 7,200 | 10,000 | 11,500 |
45 | 4,350 | 1,000 | 2,750 | 350 |
47 | 27,500 | 29,000 | 32,000 | 27,500 |
49 | 8,750 | 2,200 | 5,500 | 350 |
51 | 4,250 | 100 | 1,500 | Nil |
55 | 5,000 | 400 | 2,000 | 400 |
High Street number |
1 Unblighted undamaged value £ |
2 Blighted undamaged value £ |
3 Damaged value £ |
4 Depreciation amount £ |
5 Section 11(3)(b) depreciation |
37 | 175,000 | 140,000 | 50,000 | 90,000 | 4,200 |
39 | 145,000 | 121,800 | 45,000 | 76,800 | 6,000 |
45 | 42,500 | 34,000 | 15,000 | 19,000 | 2,750 |
47 | 145,000 | 116,000 | 35,000 | 81,000 | 23,500 |
49 | 130,000 | 104,000 | 40,000 | 64,000 | 3,500 |
51 | 97,500 | 78,000 | 30,000 | 48,000 | 750 |
55 | 225,000 | 174,400 | 65,000 | 109,400 | 2,000 |
"It would, in my judgment, be open to the Tribunal to make an award of damages in the depreciation amount but only when that amount truly represented what the claimant had lost through the Authority's failure to carry out their obligations under the Act."
He said that if the Authority had carried out the works to regrade the land, to the extent that there was depreciation caused by the fact that the land was not restored but was only regraded, a payment equal to the amount of the residual depreciation would have fallen to be made under s. 11 (3) and that if he ordered the Authority to carry out the regrading works, it would be appropriate also to order the payment of that amount by way of an award of damages.
"Neither the Act itself nor regulations made under section 29 provide for the payment of compensation for blight (although under section 29 (2)(b) regulations could make such provision), and I do not find it possible so to construe the provisions as enabling this Tribunal to make an award that reflects depreciation due to blight."
High Street number |
1 Depreciation + 20% £ |
2 Total costs £ |
37 | 108,000 | 43,446 |
39 | 92,160 | 39,551 |
45 | 22,800 | 43,058 |
47 | 97,200 | 86,577 |
49 | 76,800 | 57,008 |
51 | 57,600 | 25,291 |
55 | 131,128 | 38,205 |
43 New Station Road
The Authority's appeal
(1) the President's approach to assessing depreciation and in particular his approach to the effect on value of the risk of future damage as opposed to damage that has already occurred;
(2) the President's decision that the Authority's right to elect to make a depreciation payment was lost when they rejected the damage notice.
Mr. and Mrs. Cordery's appeal
Lord Justice Mance:
Mr Justice Hooper:
"11 (3) Where in the case of any property affected by subsistence damage--
(a) remedial works have been executed; but
(b) there is a depreciation in the value of the property caused by any damage the making good of which to the reasonable satisfaction of the claimant and any other person interested was not reasonably practicable,
the Corporation shall made in respect of the property a payment equal to the amount of that depreciation."