Subterranean development has become very popular in London. However, the noise and disturbance caused by construction work and concerns about the effect on the structural stability of buildings nearby have caused huge controversy. Campaigners have suggested new laws to control basement developments and some planning authorities are introducing stricter policies in areas where subterranean development is most prevalent.
Meanwhile, neighbouring landowners are attacking basement developments however they can. The litigation in Hicks v 89 Holland Park (Management) Ltd [2014] EWHC 2962 (Ch); [2014] PLSCS 252 concerned proposals for development at deep basement levels on land that was affected by restrictive covenants. The covenants prohibited the landowner from making planning applications without asking the owner of the neighbouring land to approve plans, drawings and specifications for the development. In their first legal encounter the parties each scored points. The judge decided that the covenants were enforceable restrictive covenants that touched and concerned the benefitted land, but ruled that they were subject to an implied term that approval should not be unreasonably withheld: [2013] EWHC 391 (Ch).
The landowner asked the company that owned the benefitted land (which was divided into flats) to approve plans for a glass, cube–like construction above ground, with two further levels, including a swimming pool, below ground. The company took the view that the development was out of keeping with its own Victorian villa and the prevailing aesthetic of Holland Park. The landowner responded by issuing proceedings for a declaration that the company was being unreasonable. Meanwhile, the planning authority announced its intention to introduce new controls on the scale, form and extent of basement structures. If they were to be adopted before the planning application was heard, the application might be refused. Consequently, the landowner wanted to submit her planning application immediately, but the company sought an interlocutory injunction to prevent this.
American Cyanamid Co v Ethicon Ltd [1975] UKHL 1 sets out the tests that the court must apply in such cases. It must conclude that there is a serious issue to be tried, without prejudging the final outcome, and must weigh the damage that would be caused by the grant or refusal an injunction and decide whether an award of damages could properly compensate the recipient of such damages for any injustice caused by its decision.
The court accepted that the company might suffer some financial detriment by being forced to respond to the planning application. However, the landowner was prepared to undertake not to implement any planning consent acquired before the outcome of the proceedings between the parties was known, or to take advantage of it at all if the company’s stance were to be upheld. The landowner also promised not to part with the land without obtaining a similar undertaking from the new owner.
The court accepted that the adoption of new planning policies would change the position to the detriment of the landowner. The court judged that the landowner was at greater risk of suffering substantial losses that could not be easily quantified, and for which she might be not be fully compensated, if her planning application were to be refused as a result. Consequently, the balance of convenience pointed firmly against an injunction.
Allyson Colby is a property law consultant
