News & Insights // Rights of Light

The Clapham Omnibus, December 2010
We do insist on living on top of each other. Whether it’s the allure of an inner city designer flat or the simple necessity of living where the work is, there is no escaping the fact that it is getting a bit crowded round here. And doubtless there are complex sociological reasons for our behaviour but the practical consequence is obvious – a mounting pressure to generate more and more living and working space from the same footprint. This pressure is pushing land use in a distinct direction – up. And despite an unsurprising hiatus caused by the lack of finance, landmark buildings and multi-storey office and residential buildings are back on the agenda and getting ever taller.
But while construction methods now allow incredible heights to be scaled, neither the engineers nor the architects have managed to build a skyscraper that does not cast a shadow – yet.
It is established law that we all have a right to receive daylight through the windows of our homes and offices. A right accrues in a number of ways, either by express grant or accumulated over time. Interference with a right of light entitles the injured party to compensation or, in certain circumstances, a court injunction prohibiting (or requiring demolition of) the offending part of a building that interferes with another’s right of light.
So are the court lists full of applications for injunctions? Seemingly not. And if you speak to the expert surveyors operating in this field, their response is typically robust – rights of light are either overlooked by neighbours or else addressed by way negotiation between developer and injured party long before building work gets underway.
The remedy for interference with rights of light is an injunction or compensation. For the developer or, indeed, the local authority, the threat of an injunction risks hampering ambitious and well intended regeneration schemes and the relatively recent run of rights of light cases has only served to increase concerns that the threat of an injunction is as real as ever. That said, in these recent decisions the courts could be said to have distilled their position - unless a developer has acted entirely reasonably throughout the course of their building project, they will be held accountable. It appears that developers should not assume they can ignore individuals’ rights of light and expect a court to sanction interference with such rights at a later date by the award of compensation (as opposed to an injunction).
So can insurance help? Much like the spectre of village greens, the threat of legal action to preserve a right of light is not a defect in title in the traditional sense. But like village greens, an application by a neighbour to prevent interference with their right of light is capable of sterilising a construction project, or rendering it uneconomical to complete. While it is a commonly held perception that title insurance shies away from risk, some insurers have adapted their risk assessment techniques and do insure rights of light-related risks. However, the methods employed by an insurer should be considered carefully as they vary. Traditionally, title insurers will accept risks on the basis of a conclusion that the prospect of a claim is remote. Typically, this decision is heavily reliant on the planning process – if the application for planning consent is successful and does not elicit any material objection on its way through, the question of remoteness is seemingly resolved. But in the context of rights of light, this approach fails to acknowledge the fact that a potential victim is unlikely to appreciate the degree of interference until construction is underway.
Insurance predicated on an assessment at the planning stage alone could create issues later in a project. Absent insurance, severe interferences to neighbour’s rights of light are normally addressed by developer through negotiation with the injured party before work starts on site. However, insurance that permits a developer push ahead on a project without due regard to the rights of light issue at the early stages of a project could store up problems for insured and insurer later down the line; when the girders are up, neighbours are far more likely to become entrenched as a point of principle and, if case law is anything to go by, so are the courts. And if a court awards an injunction, rather than damages, the developer would recover its abortive costs under a typical policy but not the anticipated profit from the project. If it is the latter that a developer wishes to protect, insurance does have a genuine role to play in helping to plot a path that will satisfy the court’s test while still allowing commercial decisions to be taken about the extent of publicity that should be given to a project or whether negotiations should be entered into with specific neighbours.
Jean Claude Domanique
Senior Underwriter and Solicitor