Westminster City Council v Ocean Leisure Ltd.

For compensation under section 10 of the Compulsory Purchase Act 1965, the claimant must show that, absent statutory protection, the authorised works would have caused actionable damage, ordinarily in public or private nuisance. Substantial interference with the public’s use of a highway may constitute a public nuisance even where it is temporary. There is no special exemption for hoardings forming part of statutory works merely because they were necessary, reasonable in extent, or maintained for a reasonable period. The limited common-law right of an adjoining owner to obstruct a highway for reasonably necessary building works does not extend to statutory construction works carried out in the highway. Special loss caused by such obstruction may therefore found a claim under section 10.

Ocean Leisure Limited occupied retail premises adjoining Northumberland Avenue and Victoria Embankment. Westminster City Council undertook construction of the Golden Jubilee Bridges under the River Thames (Hungerford Footbridge) Order 1999. Hoardings enclosed parts of the highway for a works site and equipment storage, impeding access and affecting Ocean’s trading activities.

The President of the Lands Tribunal determined as a preliminary issue that Ocean could claim compensation under section 10 of the Compulsory Purchase Act 1965 for any diminution in rental value caused by obstruction of the highway. The Council appealed on a point of law, arguing that necessary hoardings did not constitute an actionable obstruction. The central issue was whether a special common-law rule excluded the claim.

1. Appeal dismissed. The Lands Tribunal was entitled to determine that Ocean could claim compensation for diminution in rental value caused by obstruction of the highway. Quantification remained for further consideration.
2. Under section 10 of the Compulsory Purchase Act 1965, as incorporated by article 16 of the River Thames (Hungerford Footbridge) Order 1999, compensation is available where land is injuriously affected by execution of the works. Following Wildtree Hotels Ltd v Harrow London Borough Council [2001] 2 AC 1, the claimant must establish damage which would have been wrongful without statutory authority, ordinarily by showing an actionable public or private nuisance. The claim is for diminution in rental value, rather than loss of profits as such.
3. Temporary obstruction of a highway is not automatically outside section 10. Wildtree distinguished highway obstruction, which is not subject to the ordinary nuisance rule of give and take applicable to personal discomfort. Clift v Welsh Office [1999] 1 WLR 796 also supported compensation for special damage caused by obstruction of nearby public roads and footpaths.
4. The authorities concerning private building works did not establish a special rule applicable to statutory works. Properly read, Harper v Hoden & Sons [1933] Ch 298 decided only that reasonable use of the highway by an adjoining owner may include reasonably necessary obstruction, for a reasonable period, to repair or rebuild the owner’s property. That principle does not govern construction works in a highway carried out under statutory authority. Herring v Metropolitan Board of Works (1865) 19 CBNS 509 was not authority for extending the private right by analogy to statutory bodies; that reasoning was rightly rejected in Lingké v Christchurch Corporation [1912] 3 KB 595.
5. The hoardings enclosed two highway areas, one for working space and one for equipment storage. Their statutory character could not be avoided by speculating that the project might theoretically have been undertaken privately. The statutory undertaker had obtained the relevant order and had to bear the statutory consequences in compensation.
6. Lord Justice Potter agreed that the authorities should be read narrowly. He emphasised that substantial interference over a substantial period with the public’s highway rights constitutes public nuisance and is not subject to give and take. An adjoining owner suffering special damage may sue at common law, while a statutory undertaker is subject to the applicable compensation scheme.

• Court of Appeal (Civil Division): On appeal from the President of the Lands Tribunal in LCA/30/2003, the appeal was dismissed. Carnwath LJ gave the leading judgment; Rix LJ agreed, and Potter LJ agreed with the reasoning and result.
• Lands Tribunal: The President determined as a preliminary issue that Ocean was entitled to compensation under section 10 for any diminution in rental value caused by obstruction of the highway.