Bennett v Birmingham Airport Ltd

Land – Compensation – Valuation – Claimant seeking compensation for alleged depreciation in value of property as result of increased noise from extended airport runway – Whether claimant entitled to damages following change in noise levels affecting market – Compensation determined accordingly The claimant lived at Oak Tree Lodge, Shadow Brook Lane, Hampton-in -Arden, Warwickshire, near Birmingham Airport. Planning permission for an extension to the airport runway and associated work was granted in November 2009, and the runway was first used in its extended form in February 2014. The claimant said that the use of the extension resulted in increased noise at his house, and he claimed compensation under Part 1 of the Land Compensation Act 1973 on the basis that the value of his property had been depreciated. Section 1(1) of the 1973 Act conferred a right to compensation where the value of an interest in land was depreciated by physical factors caused by the use of public works. To be eligible for compensation a claimant had to have a qualifying interest in land and had to make a claim within a prescribed period. The physical factors which might give rise to a claim were identified in section 1(2) and included noise, vibration and artificial lighting. The relevant public works were listed in section 1(3) and section 9 and included any aerodrome. The claimant said that he and his family had lived in their home for 14 years, without complaint. However, from February 2014 life became more difficult; more and noisier aircraft started to fly closer and lower overhead at all hours. Almost immediately upon the runway being extended, sleep was disturbed and aircraft noise seemed louder and was more intrusive. Even in the peak of summer, windows and doors had to be kept shut because the noise of aircraft passing overhead was so intrusive. Held: Compensation was determined accordingly. (1) A claim under Part 1 of the 1973 Act could not be made before the “first claim day”, which was the day following 12 months from the date when the runway alterations were first used. Compensation was assessed by reference to current prices on the first claim day, including any expected intensification of use. The extended runway was first used on 5 February 2014 and so the first claim day and the valuation date was 6 February 2015. On an application under Part 1, the tribunal was charged with determining how the change in noise levels affected the market, not how it affected individual claimants. A prospective purchaser at the first claim day might not have known about the historical change in the pattern and level of noise caused by the opening of the runway extension. The purchaser would not care about what the noise environment used to be like but might be concerned about the possibility of intensified use of the airport in the future. The claimant’s direct evidence was not irrelevant but it was not a determining factor in the valuation exercise. (2) There first had to be a demonstrable change in a physical factor, in this case noise, and it must have been caused by the use of the works. In that sense the noise experts’ evidence was necessary because, to succeed, the claimant had to be able to show that the use of the relevant works had caused a change in a prescribed physical factor. Secondly, there had to be a demonstrable diminution in value of the claim property because of the change in the physical factor. Proof of a reduction in value per se following the works would not be enough for the claim to succeed; those changes in values might be down to something else, including some consequence of the works which was not on the list of prescribed physical factors. Accordingly, the noise evidence was relevant to the extent of demonstrating a change in the prescribed physical factor of noise. But the valuation evidence was crucial in answering the question of diminution. (3) In reality, the extent to which the noise evidence influenced the valuation evidence was questionable. The valuers came to their conclusions from direct experience, and from data and evidence of sales of property in the area. While neither valuer totally ignored the noise evidence, it served to reinforce the opinions that they had already reached, based on their usual sources of evidence. The tribunal would not disregard expert technical evidence from acoustics specialists as unimportant or irrelevant. Nevertheless, the task of the tribunal was to determine the depreciation (if any) of the value of the claimant’s interest. That was a matter for the market, and the bidder in a residential market did not have an acoustics expert at his elbow when making his bid. A claimant’s subjective impressions would more strongly influence the potential purchaser than would the scientific calculations of acoustics experts: King v Dorset County Council [1997] 1 EGLR 245, Robertson v Manchester Airport plc [2010] UKUT 370 (LC), Mann v Transport for London [2016] UKUT 1026 (LC) and Aldridge v London Southend Airport Company Ltd [2021] 8 (LC) considered. (4) Section 1(1) of the 1973 Act gave a claimant a right to compensation “where the value of an interest in land” was depreciated by physical factors caused by the use of public works. There was no equivalent provision to the right to compensation “not directly based on the value of land” under rule 6 in section 5(6) of the Land Compensation Act 1961. The convention in valuing claims under the 1973 Act was to compare the value of the affected property with the works in use and the physical factors “switched on” with its value with the works physically present but “switched off”, or “switched down” in this case, the difference being equivalent to the compensation payable. The defendant’s expert accepted that if the tribunal was satisfied that there had been a significant increase in levels of noise, it would follow that there would be an element of compensatable diminution in the value of the property. Since the tribunal was satisfied in that respect, its parameters of compensation were set: it had to be higher than the defendant’s zero and lower than the claimant’s 20%. The switched-off value of the property was in the region of £400 per sq ft. That would generate a capital value in the order of £560,000. With a switched-on value of £485,000, that would mean a diminution of £75,000, or 13.5%. In all the circumstances, that was an appropriate percentage reduction. The compensation would be determined at £75,000.  Barry Denyer-Green (instructed by Barlow Associates Ltd) appeared for the claimant; Caroline Daly (instructed by Squire Patton Boggs) appeared for the defendant. Eileen O’Grady, barrister Click here to read a transcript of Bennett v Birmingham Airport Ltd