Holbeck Hall Hotel Ltd v Scarborough Borough Council

An occupier may owe a measured duty to address a natural hazard on its land which threatens a neighbour, including a hazard involving loss of support. The duty arises when the occupier knows, or is presumed to know, of the relevant condition and can reasonably foresee the resulting danger.

Presumed knowledge does not ordinarily require expert investigation of a latent defect. The duty is confined by the extent of the foreseeable risk, the practicability and cost of abatement, the parties’ resources and interests, and the time available. An occupier is not liable for damage vastly exceeding anything foreseeable without extensive investigation. Reasonable performance may sometimes require only a warning and disclosure of relevant information.

A massive landslip destroyed a hotel situated above coastal land owned and occupied by a local authority. The instability extended across both properties. Although the authority knew that earlier slips might eventually affect part of the hotel grounds, it did not foresee that the hotel itself was endangered. The catastrophic risk could have been discovered only through extensive, two-stage geological investigation.

HH Judge Hicks QC held the authority liable for breach of a measured common law duty of care. He rejected claims based on an easement of support and a conveyancing covenant, and there was no cross-appeal on those issues. The authority appealed against the finding of liability. The central questions were whether the measured duty applicable to natural nuisances extended to an omission to preserve support and, if so, whether its scope encompassed the catastrophic damage.

1. Appeal allowed unanimously. Stuart-Smith LJ delivered the judgment, with which Schiemann and Tuckey LJJ agreed. Judgment was entered for the defendant authority.

2. The principle in Leakey v National Trust [1980] 1 QB 485 applies to a natural danger involving loss of support. There is no principled distinction between an encroachment or escape and another nuisance which causes physical damage to neighbouring land. Where an occupier has neither created nor adopted the danger, liability for continuing it depends upon negligence and knowledge of the hazard. The contrary dictum in Bond v Nottingham Corporation [1940] 1 Ch 429 was obiter and no longer represented the law without qualification.

3. A measured duty arises when the occupier knows, or is presumed to know, of the defect or condition and a reasonable person would foresee that it is likely to damage the neighbour’s land in the reasonably near future. Presumed knowledge concerns a patent condition which the occupier or a responsible servant should have observed. It does not ordinarily make the occupier liable merely because expert investigation would have revealed a latent defect.

4. The duty requires only what is reasonable in the occupier’s individual circumstances. Relevant matters include the known risk and foreseeable extent of damage, the practicability, complexity and cost of preventive measures, the time available, the occupier’s resources and interests, and the respective position of the threatened neighbour. The ordinary rule that a tortfeasor may be liable for the unforeseeable extent of foreseeable damage does not apply without qualification to a natural hazard which the defendant did nothing to create.

5. The authority foresaw that progressive slipping might eventually damage part of the hotel grounds. It could not foresee the catastrophic rotational slide, or danger to the hotel, without extensive geological investigation. The duty was therefore confined to damage which was foreseeable without that investigation. Any foreseeable loss of part of the grounds had no real value because the underlying latent defect already made that land liable to subside.

6. The measured duty might have required the authority to warn the owners about the appreciated risk and disclose its engineering report. That case had not been pleaded or argued, and proof that such disclosure would have led to investigation and effective remedial works presented formidable causation difficulties.

1. Court of Appeal: Allowed the local authority’s appeal unanimously and entered judgment for the defendants. The authority’s liability for the catastrophic landslip fell outside the scope of its measured duty of care.
2. Technology and Construction Court (HH Judge Hicks QC): By judgment dated 3 April 1998, held the authority liable for breach of a measured common law duty of care. Claims based on an easement of support and the covenant in the 1895 conveyance were rejected.