Network Rail Loses Japanese Knotweed Appeal

Nigel Mykura [CC BY-SA 2.0 (https://creativecommons.org/licenses/by-sa/2.0)], via Wikimedia Commons

The Court of Appeal has delivered its judgment in the case of Williams v Network Rail Infrastructure Ltd [2018] EWCA Civ 1514 concerning the spread of Japanese Knotweed from the defendant’s land. The full facts are set out in my blog entry relating to the County Court judgment.

The Court of Appeal upheld the decision of His Honour Judge Grubb in the Cardiff County Court to the extent that Network Rail was liable in nuisance for the spread of the plant; however, it strongly disagreed with much of the reasoning applied by the lower court. The decision raises some important doctrinal issues in the tort of nuisance which shall be dealt with in turn.

The encroachment cases

The County Court held that the encroachment cases (which mainly concern tree roots and overhanging branches) constituted a distinct branch (pun not intended!) of nuisance. The case of Delaware Mansions v Westminster City Council  [2002] 1 AC 321, [2001] UKHL 55  was used as authority for the proposition that physical damage to property is a necessary ingredient of the tort in this context. The County Court was fortified in its conclusions by some scholarly arguments to the effect that this type of claim would originally have been brought under a medieval form of action known as action on the case which necessitated the existence of tangible harm. This ingredient was lacking in the case at hand in that, although the rhizomes had infiltrated the foundations of the property they had not done any damage.

The Court of Appeal concluded that the analysis of the County Court was wrong on this point. Firstly, it was held that it was unwise to fetter the development of the common law by adhering to medieval categories in an overly dogmatic manner. Damage should be regarded as an elastic concept in nuisance and the encroachment cases should not be interpreted as precluding harm which fell short of actual injury to the fabric of the property. Nuisance is about the protection of property rights and, in particular, the use and enjoyment of the land. The presence of such an invasive weed and the knowledge of the harm which it may cause must clearly have a detrimental effect on the use and enjoyment of the property. In any case, there were clear grounds for arguing that the presence of the rhizomes did in fact amount to physical damage in that they placed a burden on the claimants and required them to take remedial measures. There was authority for the proposition that the dirtying or contamination of property can be regarded as physical damage, even though the fabric of the property is not affected in the long term, as it has to be cleaned in order to render it fully usable once more. See Court of Appeal judgment in Hunter v Canary Wharf [1996] 2 W.L.R. 348 concerning the deposit of dust requiring professional cleaning and Blue Circle Industries v Ministry of Defence [1998] 3 All ER 385 concerning low level nuclear contamination requiring removal at considerable expense.

Depreciation in market value

Although the County Court rejected the notion that the harm in this case fell within the encroachment category, it accepted the argument that the proximity of the Knotweed constituted a nuisance in that it had a detrimental effect on the value of the property. Although the Court of Appeal agreed with the outcome on this point it disagreed with the reasoning. In short, it was held that the County Court had failed to properly link the financial loss with any interference with property rights. Instead, the CC had reached the conclusion that the  mere presence of an undesirable element, which has a detrimental effect on the value of property, is actionable. The Court of Appeal, on the other hand, held that this would be a type of pure economic loss which is not grounded in any interference with property rights. The financial loss must flow from some interference with the use and enjoyment of property. For the aforementioned reasons, the presence of the Knotweed clearly interfered with the use and enjoyment of the properties and was thus not pure economic loss in that sense.

The purpose of the tort of nuisance is not to protect the value of property as an investment or a financial asset. Its purpose is to protect the owner of land (or a person entitled to exclusive possession) in their use and enjoyment of the land as such as a facet of the right of ownership or right to exclusive possession. The decision of the Recorder in the present case extends the tort of nuisance to a claim for pure economic loss. Counsel for the claimants did not identify any case in which a similar decision was reached or, more generally, where the amenity of a property has been held, for the purposes of actionable private nuisance, to include the right to realise or otherwise deploy the value of the property in the financial interests of the owner. Contrary to the view of the Recorder, that would not be an incremental development of the common law by way of analogy but a radical reformulation of the purpose and scope of the tort. (per Etherton MR at [48].

This aspect of the decision serves to clarify what is meant by the term pure economic loss in this context. A loss is purely economic loss if the claimant only has a financial interest in the affected property. Ones interest in the home is not purely a financial interest in that one depends upon it for shelter and general wellbeing. This raises the interesting issue of whether claims brought by property developers and speculators would be dismissed on the grounds that their interest in the matter was purely economic.

Comments

From a doctrinal perspective the decision is important in that it seeks to break down some of the categories that have arisen between various types of nuisance. The Court of Appeal clearly felt that this was an area where the medieval ghosts were being allowed to rattle their chains. It also seeks to clarify what is meant by harm in nuisance and underscores the need to adopt a flexible approach. Harm in nuisance is inextricably connected with the protection of certain types of interest in land and it can be misleading to import concepts from other branches of tort such as the concept of pure economic loss. This has a specific meaning in negligence which may not equate with the concept of harm in nuisance.

In any event, it has now been clearly established that the presence of Japanese knotweed may give rise to a claim in damages for diminution in market value and the costs of treatment irrespective of any damage to the actual fabric of the property. This has serious ramifications for Network Rail and all other major property owners.

Japanese Knotweed and Network Rail

Japanese Knoweed takes over a flower border at Dorchester South station. Photo by Nigel Mykura

A knotty problem

Railway embankments and cuttings play host to a vast array of flora including many ornamental plants which have long since escaped from the confines of neighbouring gardens. In summer they are festooned with the purple cones of buddleia flowers providing splashes of colour for the benefit of weary commuters gazing idly through the dusty windows of urban stopping trains. A far less welcome inhabitant of railway land, however, is the notorious Japanese Knotweed (Fallopia Japonica) which was first commercialized as an ornamental  plant in this country in the mid-nineteenth century. It quickly escaped the confines of gardens and has steadily spread ever since.

The species is incredibly invasive and it spreads by sending out roots and rhizomes which spread deep in the soil before sending up shoots which have been reported as having the capacity to smash through concrete and tarmac, although some have argued that the threat has been exaggerated. Whatever the extent of the risk there is no doubt that the mere presence of the plant causes a serious blight problem for property.

Railway embankments and cuttings are not cleared of excessive vegetation as regularly as they used to be. At one time regular clearances were necessary to reduce the risk of lineside fires caused by stray sparks from passing steam trains. Such fires often spread to neighbouring property and resulted in vast amounts of litigation. It is possible that, after the last scheduled steam service departed on 11 August 1968, officials in British Railways may have expressed relief at the fact that there would no longer be any need to expend so much time and effort in clearing vegetation from the lineside. Anyone expressing such sentiments could not have anticipated that the change in policy may have contributed to the replacement of railway sparks with a new peril of a more organic nature.

Williams v Network Rail Infrastructure Ltd 

Japanese Knotweed has inevitably spread from railway land to neighbouring property and, somewhere in the offices of Network Rail, it is reasonable to assume that there must be an increasingly fat file of complaints. Two such complainants are Robin Waistell and Stephen Williams, both of whom own neighbouring properties in the Welsh town of Maesteg in close proximity to an embankment overrun with the plant. It was estimated that the plant established itself there about 50 years ago but had been contained until more recent times.  The complainants met resistance when they first sought compensation from Network Rail regarding the incursion of the plant on their land. They alleged that it had infiltrated the foundations of their bungalows and slashed the value of their properties. The media reported that, hitherto, Network Rail had met claims out of court but, due to concern at the steadily growing number of complaints and the amount that it was having to pay out, decided to make a stand in order to establish that it was not liable as a matter of law: see MailOnline. Thus messrs Waistell and Williams found themselves locking horns with Network Rail in litigation: Williams v Network Rail Infrastructure Ltd (also know as Waistell v Network Rail Infrastructure Ltd) [2017] UK CC (2 February 2017)  (unreported). 

Damage to property?

The matter was tried at the Cardiff County Court, before His Honour Judge Grubb, where argument turned upon two strands of the law of private nuisance. The first strand focused on the encroachment cases as exemplified by the cases of Lemmon v Webb [1894] 3 Ch 1 and Delaware Mansions v Westminster City Council [2001] UKHL 55; [2002] 1 AC 321, both of which were cited in argument. On this issue it was held that actual damage to property was needed in order to establish liability on this ground. The judge did not accept that the foundations had actually been damaged and the mere encroachment of the roots and rhizomes into the foundations would not suffice.

Loss of amenity

The second strand of nuisance law focused on loss of amenity value caused by proximity to some undesirable land use. Here it was noted that in the past damages had been awarded in nuisance in respect of the deleterious effects of brothels and sex shops on the amenity value of neighbouring properties. This approach circumvented the need to show actual physical damage to the fabric of the property. The claimants argument on this basis was successful, however, it was also necessary to show the harm was foreseeable and in this respect the defendants were deemed to have had constructive knowledge of a document produced by the Royal Institute of Chartered Surveyors and the Property Care Association which set out guidance on the management of the Knotweed problem.

Continuing the nuisance

There was a final complication in this case stemming from the fact that Network Rail had not set out to cultivate the plant or consciously brought it onto its land. However, once an undesirable element establishes itself on land there is a clear duty to do something about it else one is deemed to have adopted the nuisance: see Leakey v National Trust [1980] QB 485. In this respect an element of fault is inserted into the equation and nuisance operates rather more like negligence than a tort of strict liability. Nevertheless, the judge was persuaded that the defendant had failed to act as a reasonable land owner and take sufficient steps to remove the Knotweed. There had been some inadequate and sporadic spraying with herbicide which in no way sufficed to discharge the duty.

Damages were awarded to both claimants in respect of the diminution in the market value of their properties and the cost of a treatment package and an associated insurance backed guarantee.

This was not the end of the story however and the matter has been appealed to the Court of Appeal which is due to hear the case in the New Year. The grounds of appeal are not clear from material readily available in the public domain although it would be difficult to contest the notion that Knotweed blights property even where no physical damage is caused. One can surmise that attention is likely to focus on the assertion that the defendant could have foreseen the problem and that it failed to take reasonable steps to abate it.

The case seems to have attracted a lot of media attention and the implications for property owners, mortgage providers and the insurance industry are clear. See, for example, The Telegraph (Money and Banking).