Yeung v Potel & Anor

Lease easements and reservations allowing access to conduits must be construed according to their wording. A right to repair, maintain or renew existing pipes permits replacement of those pipes, including relocation within the demised premises, but does not authorise laying new or additional pipes outside the demise. A court will not imply a reservation merely because it would be sensible or desirable; necessity is required, particularly where a carefully drafted lease could have stated the right expressly. A lessee cannot enlarge the demise by removing a ceiling and occupying space demised to another flat. On appeal, detailed damages assessments based on evidence will not be reopened absent an error of principle, and new evidential points cannot ordinarily be raised for the first time.

The respondents, lessees of Flat 4, brought proceedings against the appellant, lessee of Flat 3, after building works caused damage, nuisance and trespass. The appellant counterclaimed for damages and an injunction requiring access to Flat 4 so that he could interrupt the gas supply and move a gas pipe and meter in Flat 3.

District Judge Langley in the Central London County Court found trespass and nuisance, awarded the respondents £87,627.05, dismissed the appellant’s counterclaims and rejected the proposed access right. The appellant appealed on the construction of the two leases and on the assessment of remedial damages. The central issues were whether the leases authorised access to facilitate moving the gas installations outside the Flat 3 demise and whether the damages assessment disclosed an appealable error.

Lord Justice Jackson gave the judgment of the court. Lady Justice Sharp and Lady Justice Arden agreed.

1. Construction of the leases. The reservation in schedule 2 permitted entry for repairing, cleaning, maintaining or renewing sewers, drains, cables, pipes and wires. Renewal meant substituting new installations for pre-existing ones. It did not include laying new and additional pipes or wires of a different character. The reasoning in Taylor v British Legal Life Assurance Co (1925) 94 LJ Ch 284, Trailfinders v Razuki [1998] 2 EGLR 46 and Lurcott v Wakeley and Wheeler [1911] 1 KB 905 supported that distinction.
2. Implied reservation. The mismatch between the right in schedule 1 to lay new pipes and the narrower reservation in schedule 2 did not justify implying additional words. A reservation over property being disposed of should be made expressly. The fact that an implied term would be sensible or desirable was insufficient; the case fell well short of necessity. The leases operated satisfactorily without the proposed addition.
3. Demise and access. The Flat 3 lease included the ceiling but excluded the joists or beams to which it was attached. The demise therefore extended only to the existing ceiling. The joists and space above were outside the appellant’s demise, or, on the alternative construction, remained space which he had no right under his lease to occupy. Raising the ceiling constituted trespass. The appellant had no right to enter Flat 4 or interrupt its gas supply to move the pipe and meter into that external area. He could enter for repair or renewal, and could place replacement installations in a new position only within his own demise.
4. Damages. The challenge to the remedial costs arose from a misreading of the builder’s estimate. A further alleged discrepancy had not been put to the expert at trial and required evidence unavailable on appeal. The trial judge had made no error of principle, and the Court of Appeal would not reopen detailed factual and expert assessments of quantum.

The appellant’s appeal was dismissed. The judgment of District Judge Langley stood.

• Court of Appeal (Civil Division): On 11 April 2014 the court dismissed the appellant’s appeal and left the judgment below standing: [2014] EWCA Civ 481.
• Central London County Court: District Judge Langley, on 20 August 2012, found trespass and nuisance, awarded £87,627.05, dismissed the appellant’s counterclaims and ordered him to pay 90% of the respondents’ costs.