Fawcett & Ors v Phoenix Inns Ltd. & Anor

An appeal confined to review is not a rehearing. Under Part 52.11 of the Civil Procedure Rules 1998, the Court of Appeal asks whether the judgment below was wrong or unjust because of serious procedural irregularity. In an escape-of-water nuisance claim, liability may be established by proof that water originated on the defendant’s land, the defendant knew or ought to have known the relevant facts, failed to take reasonably necessary steps, and thereby caused loss. Knowledge that the facts constituted a nuisance in law is unnecessary. A single precise source need not always be identified where the evidence establishes an escape from the defendant’s land. Damages may be assessed by reasonable inference and proportionate apportionment where concurrent causes and limited evidence make exact attribution impossible, provided the causal link remains apparent.

Members of the Fawcett family, who owned adjoining premises, claimed that foul and surface water escaped from Phoenix’s Talbot Hotel and entered their cellar, constituting a continuing nuisance. The Newcastle upon Tyne County Court found liability, granted an injunction, and awarded damages for repairs and loss of rent.

Phoenix appealed, alleging inadequate findings on the source of the water, knowledge, reasonable remedial action, the form of the injunction, and causation of damage. The central issues were whether the judge’s reasoning and orders were legally sufficient and whether the appeal disclosed any basis for intervention.

The appeal was dismissed unanimously. Aikens J gave the principal judgment, with Arden LJ and Schiemann LJ agreeing.

1. The Court applied Part 52.11 of the Civil Procedure Rules 1998. The appeal was limited to review because no rehearing was sought. The Court applied the approach in English v Emery Reimbold & Strick Ltd [2002] EWCA Civ 605, [2002] 1 WLR 2309: the judgment had to be read with the evidence and submissions to determine whether the reasons and a valid basis for the decision were apparent.
2. The applicable nuisance test required proof, on the balance of probabilities, that the water originated from the Talbot, that Phoenix knew or ought to have known the relevant facts, that it failed to take reasonably necessary action, and that the resulting loss was caused by the ingress and failure to act.
3. The judge’s findings established a path between the properties, defects in the Talbot drainage, Phoenix’s knowledge of the relevant facts, and the substantial contribution made by the Talbot drainage. Phoenix did not need to know that the facts amounted to a nuisance in law. The presence of groundwater did not defeat liability.
4. Late dye-test evidence was excluded. It could readily have been obtained before trial, and admission would have required further testing by the claimants and caused unfairness.
5. The injunction was sufficiently clear. It required investigation of the areas identified by the expert and repair if leaks were found. Phoenix could apply for an order confirming that its obligations had been discharged in any area where investigation revealed no leak. Counsel should raise apparent defects in an order or judgment promptly with the trial judge. Arden LJ agreed with this general guidance but made no professional criticism of counsel.
6. The damages reasoning was adequate. Given the limited evidence and the concurrent contribution of groundwater, the judge was entitled to use reasonable inferences and percentage deductions, provided the causal link between the nuisance and the awarded damage remained. Future repair costs were recoverable because the nuisance was continuing, and the loss-of-rent findings disclosed no error.

• Court of Appeal (Civil Division) [2003] EWCA Civ 28: dismissed Phoenix’s appeal from the liability and damages judgments and upheld the injunction.
• Newcastle upon Tyne County Court: HHJ Moir found a continuing nuisance, granted an injunction, and awarded damages for repairs and loss of rent.