Arena Property Services Ltd. v Europa 2000 Ltd.

A claimant seeking compensation under section 7(2) of the Party Walls Etc Act 1996 on the footing of an easement must prove that easement. A vague assertion based on an unidentified source did not establish the necessary long use of a soil pipe.

The court also held that a surveyors’ award authorises statutory works but does not itself extinguish an existing easement. Where an easement is proved, section 7(2) can provide compensation for loss caused by work lawfully carried out under the Act. The court left unresolved whether the surveyors’ compensation jurisdiction is exclusive.

Arena, the leaseholder of 96 Farringdon Road, served a party structure notice proposing works which included removal of a soil vent pipe projecting from 98 Farringdon Road. The freeholders of 98 were then the only adjoining owners. Europa later acquired a lease of the upper floors of 98, which the pipe served.

Following a surveyors’ award, Arena removed the pipe. Europa brought a Part 20 claim alleging a prescriptive easement and seeking compensation under section 7(2) of the Party Walls Etc Act 1996. The County Court dismissed the counterclaim, holding that no easement had been established. The central issue on appeal was whether Europa had proved the easement on which its claim depended.

1. The appeal was dismissed unanimously. Lady Justice Arden gave the leading judgment, with which Lord Justice Dyson and Lord Phillips MR agreed. Europa had failed to establish the easement which formed the foundation of its claim.

2. The judge had been entitled to reject the evidence relied on to prove the easement. Europa needed to establish that the pipe had existed and been used for the necessary period. Its only evidence was an assertion by a director who had only recently become involved with the property and did not identify the source of his information. There was no adequate evidence of the pipe’s age, connection or continuous use. It would not be appropriate to remit the matter merely to allow Europa a second opportunity to adduce evidence.

3. Lady Justice Arden nevertheless concluded that the surveyors’ award did not itself extinguish an easement. It authorised Arena to carry out work; an easement would be lost only when the pipe was blocked so that an adjoining owner could no longer use it. If an easement had been established, section 7(2) of the Party Walls Etc Act 1996 would have conferred a right to compensation despite the lawfulness of the works. An inquiry as to compensation would then have been appropriate.

4. The court did not decide whether section 9 applied, nor whether the surveyors’ jurisdiction under section 10 was exclusive. It provisionally observed that an easement for the pipe related to the party wall and could not be divided into separate easements. The relationship between sections 2 and 9 was left open.

The order was that the appeal be dismissed, with costs to the respondent assessed at £5,600.

• Court of Appeal (Civil Division) — dismissed the appeal in [2003] EWCA Civ 1943 and upheld the dismissal of Europa’s Part 20 claim.
• Central London County Court (His Honour Judge Cowell) — dismissed Europa’s counterclaim after finding that no easement had been established.