To be or Knot to be, a nuisance?

Guest article written by Katharine Cusack and Alexandra Anderson at RPC

We have previously written about the updated RICS guidance on Japanese Knotweed introduced last year.

That guidance was published with the goal of moving away from the stigma attached to Japanese Knotweed and the notion of eradication being the only option.

Six months on, has the recent decision of Davies v Bridgend County Council (BCC) helped or hindered that goal?

What happened?

In this Court of Appeal case, the appellant owned land that adjoined land owned by the BCC. Japanese Knotweed had been present on BCC's land for over 50 years. The appellant bought his property in 2004 and the knotweed on BCC's property began to cause a problem from 2013 onwards. However, BCC did not take steps to treat the knotweed on its own land until 2018. The district judge found that the BCC had breached the relevant duty in nuisance from 2013 to 2018 until it began to carry out treatment on the knotweed.

Notwithstanding the breach, the district judge dismissed the claim, relying on the decision of the Court of Appeal in the case of Network Rail v Williams to find that "damages for diminution in value of the property [were] irrecoverable as it constituted pure economic loss". On appeal, the Circuit Judge upheld the findings at first instance. Mr Davies appealed both decisions to the Court of Appeal on the grounds that both judges had "erred in that they [had] misunderstood Williams".

Diminution value: pure economic loss?

The Court of Appeal examined the judgment in Williams and assessed the criteria used by the judges in reaching their decision. It determined that "in a case in which the knotweed is on the defendant's land, even if it is close to the boundary and at risk of invading the claimant's land, Williams holds that the reduction in market value of the claimant's land which this causes does not result from physical damage nor from physical interference with the claimant's property and therefore does not amount to a nuisance". However, the Court of Appeal went on to distinguish the situation in Williams from this case, where nuisance had been established, stating: "once it is accepted that there was damage leading to a loss (the diminution in value) which was consequential on the nuisance, there is no authority that consequential damage to the claimant's economic interests is irrecoverable."

One point discussed by the Court was whether it would have made a difference if the encroachment of knotweed on the land was trivial. However, the Court of Appeal stated that this was not the case and neither party had argued the point at trial.

When it can be established that there is a natural hazard present on a claimant's land, the land's 'amenity value' will be diminished, thereby constituting 'damage' under the tort of nuisance. The Court held therefore that "if consequential residual diminution in value can be proved, damages on that basis can be recovered. They are not pure economic loss because of the physical manner in which they have been caused".

The Court of Appeal confirmed that any attempt by the appellant to treat the knotweed on his land would have been futile unless BCC treated the knotweed on its land. "The harm to the quiet enjoyment and amenity suffered by the appellant persists in 2018 precisely because the nuisance is a continuing one. The harm has been caused by the breach of duty."

The Judge granted the appeal and awarded the full residual diminution in value claimed, which was £4,900.

Help or Hindrance?

At first blush it may seem that this decision goes against the aims of the RICS guidance by determining that, after treatment, knotweed can still constitute a nuisance and result in a diminution in value of property. However, there are some points to bear in mind. The knotweed in question was present on the BCC's land for over 50 years and treatment was only carried out from 2018. Whilst it is stated the treatment was effective, given the short amount of time that had passed since the case was heard and the conclusion of the treatment, this may not have been sufficient to determine whether the knotweed had indeed been completely managed. The parties agreed there was no visible knotweed present on the appellant's land, but it is often the case that there needs to be a management plan to ensure there is no regrowth. Indeed, the Property Care Association advises that properties may need monitoring for at least two years once treatment has completed to ensure there is no regrowth.

In addition to the above, the respondent did not produce any expert valuation evidence to contradict the appellant's expert evidence on diminution. The Court indicated that, if the respondent had wanted to make any points on the quantum, it should have produced its own evidence.

It was agreed that residual diminution in value reduces over time and therefore, perhaps if the claim had been brought in a few years' time, the sum claimed may have reduced.

Takeaways

This article has been written by Reynolds Porter Chamberlain LLP "RPC" and the opinions and views stated in this article are those of RPC and not Howden Insurance Brokers Limited (“Howden”). Howden is an insurance broker and is not authorised or regulated to advise on the guidance notes issued by the Royal Institute of Chartered Surveyors (RICS). Howden shall not (i) owe or accept any duty, responsibility or liability to you or any other person; and (ii) be liable in respect of any loss, damage or expense caused by your or any other party’s reliance on this article.