- “Erebus Developments” has built a six-storey development. On the other side of the road, there are three residential houses.
- The houses enjoy rights of light over the development site. The top two storeys of the development infringe those rights of light. Those two storeys: (i) cost £½m to build; (ii) were predicted (in a development appraisal carried out at the outset) to result in a net increase in the value of the development of £2m (being the increase in the value of the development attributable to the two storeys minus the cost of building those storeys); (iii) will, in fact, result in a net increase in value of £3m (due to a rise in property prices); and (iv) would cost £½m to demolish. After completing the building works, Erebus discovered that a world-renowned drama school has, unexpectedly, lost its home. As a philanthropic gesture, Erebus has announced that it will let the top storey of the development to the drama school under a 999 year lease at a peppercorn rent.
- The owner of only one of the three houses appreciates that the development has infringed its rights of light.
- That house contains the collection of a Victorian taxidermist. The house is owned by a charitable trust (the “Stuff of Life Foundation”) which allows members of the public to visit the house and view the collection. Before building work started, Erebus obtained a report from a rights of light surveyor. The report concluded that the development would infringe Stuff of Life’s rights of light only by reducing the light to a staircase. Erebus queried that report. A second draft was produced which concluded that the infringement would be more extensive. Nevertheless, Erebus sent Stuff of Life the initial draft of the report (which, due to the revised draft, Erebus knew to be inaccurate).
- In response to the initial draft of the report, Stuff of Life’s trustees (a disorganized and uncommercial bunch) made an offer, in expressly open correspondence, to accept £150,000 in compensation for the infringement of its rights of light to the staircase. Erebus turned down that offer. There were no further negotiations.
- After the development was completed, Stuff of Life’s trustees realized that the development had reduced, not only the light entering the staircase, but also the light entering the magnificent “Elk Room” (so as seriously to infringe the rights of light to that room). Stuff of Life has commenced proceedings seeking the removal of the top two storeys of the development.
- Would Stuff of Life be granted an injunction requiring the demolition of the top two storeys of the development?
- If not, what damages in lieu would be awarded?