Articles

PART 5: HISTORICAL OVERVIEW - REPRESENTATIVE 19TH CENTURY DECISIONS

This case interprets the U.K. Lands Clauses Consolidation Act (1845), and is one of the series of cases attempting to determine what, if anything, constitutes compensable injurious affection under that Act. The facts, briefly put, are that the West End of London and Crystal Palace Railway Company was authorized by statute to build a railway. During the course of so doing the railway company ran its tracks across what was the high road (i.e. road to London) approximately seventy yards from the last of twelve houses owned by the Plaintiff. The crossing of the high road by the railway caused the permanent blocking up of the old high road, although a replacement road in a slightly different location was constructed.

The Plaintiff made a claim for compensation for injurious affection, and the matter appears to have been thoroughly argued except for the issue of the interpretation of s. 68 of the Act. The court seemed to assume that s. 68 conferred a right to claim for injurious affection in the absence of a taking. The position taken by the Defendant was essentially that there would be no civil action available to the Plaintiff (his loss was the same as that of his neighbours) in the absence of the Lands Clauses Consolidation Act therefore there should not be compensation under that Act. The Defendant further argued that although the Plaintiff lost the use of the high road as a through road, the existence of the railway must be considered to be of benefit to the Plaintiff, among others, thereby offsetting any loss suffered by the Plaintiff. It was further argued that the Lands Clauses Consolidation Act did not give a right to claim compensation in the absence of a taking. On the Plaintiff's side it was argued that the effect of the works, notwithstanding the fact that there was no expropriation of land "took" from the Plaintiff in that value was removed from the Plaintiff's properties. The argument was "that some of the land was taken, using the word in a large sense". The Plaintiff says that the premises will not "let for shops now, only for private houses and at a lower rent".

The court held in favour of the Plaintiff and considered specifically the argument that the Plaintiff would not have had an action at common law because the right which had been taken away from him (the right to through traffic from the tenants of his house along the high street) was a public right and as such no action would have lain in the absence of proof of a particular loss suffered by the Plaintiff, as follows:

There are, indeed, many cases in which an act may be in law an injury, and may produce damage to an individual, and yet in which the law affords no remedy .... There are cases in which the act done is grievance to the entire community, no one of whom is injured by it more than another. In such a case, the mode of punishing the wrongdoer is by indictment, and by punishment only. Still, if a person has sustained a particular damage therefrom beyond that of his fellow citizens, he may maintain an action in respect to that particular damnification. The Plaintiff has suffered a particular damnification. He has found that the high road has been stopped up in close proximity to the Plaintiff's houses; and that the thoroughfare of passengers past the houses has been put an end to, and that the Plaintiff's houses have been injuriously affected thereby.

What is to be drawn from this decision is that the Lands Clauses Consolidation Act (1845) applies to grant a right of compensation in the absence of a taking, that a lowering of the value of the lands for the purposes for which they are put or reasonably intended may constitute an injury to the land itself and not simply to trade or business, and that compensation for injurious affection under the Lands Clauses Consolidation Act does not lie for an injury or loss of value which may be suffered by the whole community, but only in the case that the claimant "sustained a particular damage therefrom (from the construction of the works) beyond that of his fellow citizens" (step 2 of the present four-step test).

This case deals with the same range of issues as Chamberlain, but evidences a somewhat different conclusion.

Lord Chelmsford commenced his judgment by quoting Lord Chief Justice Erle as follows:

If possible some definite and precise rule should be laid down as to the true limits within which claims against railway and other companies for compensation in respect of damage caused by their works are to be confined.

Lord Chelmsford went on to say:

It appears to me to be a hopeless task to attempt to reconcile the cases upon the subject,....

There does not appear to have been significant improvement over the last 120 years.

Lord Chelmsford concluded that a basic principle to follow in attempting to define the limits of compensation of injurious affection in the absence of a taking is that unless the act of the public authority would have been actionable at common law in the absence of the statute allowing the works, there would not be compensation under the Lands Clauses Consolidation Act (1845) (step 2 of the what we now know as the four-step test).

In this case, the Plaintiff, an operator of a public house (called the Pickled Egg), brought action for compensation under the Lands Clauses Consolidation Act because, during the course of construction of a railway by the Defendant, certain streets leading to the footpath on which the Plaintiff's pub was located were obstructed. The obstruction lasted for twenty months and as a result the Plaintiff lost business to the extent of approximately 100 pounds. The Court found that there was no claim for compensation under Section 68 of the Lands Clauses Consolidation Act for a temporary obstruction. What we now know as the construction rule (step four of the four-step test) is interpreted here as referring to the state of the works in their constructed condition, as opposed to a claim for compensation that may arise only out of damage caused during the course of construction. Lord Cranworth dealt with the principle that for there to be a claim for injurious affection with no taking the damage or loss suffered by the claimant must be different, in a qualitative way, from that suffered by the general neighbourhood. His Lordship stated (page 198):

The very existence of a railway must cause loss to many persons in its neighbourhood. Every inn or posting house at which post-horses were kept suffered, as is well known, grievous loss by the first establishment of a railroad in its neighbourhood; in fact, the business of such a house was often utterly destroyed. But it was never contended that this was an injury to the house, ... for which compensation could be demanded. The house sustained no injury, though the profits of the occupier were diminished or destroyed. Such a claim, if sustainable, would admit of no limit. The railroad would, it is true, chiefly affect the custom of posting-houses near to it, but it would or might diminish the quantity of posting to an almost indefinite extent, and I can discover no limit to the claims which on the doctrine asserted, might be successfully made. Precisely the same observations may be made with reference to the present claim. The loss occasioned by the obstruction now under consideration may be greater to the Plaintiff than to others, but it affects more or less all the neighbourhood. He has no ground of complaint different, save in degree, from that which might be made by all the inhabitants of houses in the part of the town where the works for forming the railway were carried on.

It is interesting to note that the House of Lords was divided in coming to its conclusions in this case. Two out of the three Judges found against the Claimant, and Lord Westbury dissented and found in favour of the Plaintiff. The Exchequer Chamber, from which the appeal was taken to the House of Lords, was also divided, four to two. Lord Westbury, in his dissenting decision in the House of Lords, said as follows, after outlining the divisions in his Court and the Court below:

It is a matter of regret that our judicial institution should admit of these anomalies. It is also painful to observe the number of conflicting decisions on the law of compensation by railway companies, which is the subject of the present appeal. It is impossible to reconcile these decisions by any sound distinctions, and the result is, that to a great extent, they neutralize each other.

This decision contains statements which are of assistance in attempting to assess, in an orderly way, the development of the law of injurious affection with no taking, particularly where it affects access. The Lyon case involved interference with riparian rights, in the consideration of which Lord Cairns in his reasons drew an analogy to highway accesses. At page 675 of the decision he said, referring to the decision of Rose v. Groves:

The Plaintiff, an innkeeper on the banks of a navigable river, complained that the access of the public to his house was obstructed by timber which the Defendant had placed in the river; and it would be the height of absurdity to say, that a private right [i.e. one actionable in private nuisance at common law or actionable in public nuisance on the basis of more particular aggrievement] is not interfered with, when a man who has been accustomed to enter his house from a highway finds his door made impassable, so that he no longer has access to his house from the public highway. This would equally be a private injury to him, whether the right of the public to pass and repass along the highway were or were not at the same time interfered with.

Then further:

Independently of the authorities, it appears to me quite clear, that the right of a man to step from his own land on to a highway is something quite different from a public right of using the highway. The public has no right to step on the land of a private proprietor adjoining the road. And though it is easy to suggest metaphysical difficulties when an attempt is made to define private as distinguished from the public right, or to explain how the one could be infringed without at the same time interfering with the other, this does not alter the character of the right.

The facts in the Lyons case were that the owner of Lyon's Wharf owned land fronting both the Thames river and a backwater of the Thames known as Winckworth's Hole. The Respondent Fishmonger's Company proposed, pursuant to a license conferred upon it by the Conservators of the Thames, to effect certain works which would result in the filling up of Winckworth's Hole, thereby cutting off access of barges via that backwater to Lyon's Wharf. In considering the issue Lord Chelmsford said at page 678:

Why a riparian proprietor on a tidal river should not possess all the peculiar advantages which the position of his property with relation to the river affords him, provided they occasion no obstruction to the navigation, I am at a loss to comprehend.

The significance of this decision to access issues, leaving aside the specific questions of riparian rights, is in its establishment of the principle that owners adjoining public ways (rivers or highway which are by statute declared to be public property) have a common law right of access thereto and as a result any interference with that right of access, with the proviso that the access must not "occasion an obstruction to the navigation" (i.e. not interfere with the safe and orderly flow of traffic on the highway) is, all other things being equal, compensable.

Lord Selborne says at page 683:

Even if it could be shown that the riparian rights of the proprietor of land on the bank of a tidal navigable river are not similar to those of a proprietor above the flow of the tide, I should be of opinion that he had a right to the river frontage belonging by nature to his land although the only practical advantage of it might consist in the access thereby affording him to the water, for the purpose of using, when upon the water, the right of navigation common to him with the rest of the public. Such a right of access is his only, and is his by virtue, and in respect of, his riparian property [i.e. the location of his property at the edge of the river - read here on the boundary of the right of way]. It is wholly distinct from the public rights of navigation. In the words of Lord Justice Mellish 'the right of embarking and disembarking, and so using his property as a wharf for the loading and unloading of goods, is a most valuable right, and I am at a loss to see why it should not be recognized as entitled to protection ..., although, it arises simply from the fact that he owns land immediately abutting on a public navigable river, which he, as one of the public, is entitled to use for the purpose of navigation.' It was admitted, that if the case had been for compensation under the Lands Clauses Consolidation Act, [i.e. a claim for interference to highway access] the land of the riparian proprietor would, by the deprivation of his water frontage, be injuriously affected.

Lord Selborne approves the cases relating to alteration of the levels of public highways by which houses adjoining them have been deprived of previously existing access.

This case is noteworthy because it continues the development of the concepts which lead to the four-step test that we see in current Canadian law with respect to claims for injurious affection with no taking.

In the Beckett decision Chief Justice Bovill considered the application of Section 68 of the Lands Clauses Consolidation Act (1845) in light of what was then viewed as the leading decision, that of the House of Lords in Ricket (referred to above). The facts in the Beckett case involved the narrowing of the road, on which the Plaintiff's house fronted, as a result of the construction of a railway embankment opposite the Plaintiff's house by the Defendant railway company. The road was narrowed from 50 to 33 feet and, according to the evidence, diminished the value of the Plaintiff's house by approximately one-third, by reason of the facts that:

The question before the Court was, assuming the above circumstances effected a permanent injurious affection to the Plaintiff's house, whether or not that injurious affection was compensable within the terms of the Lands Clauses Consolidation Act. The Chief Justice stated at page 93:

If the Claimant's right of access from or to the highway was taken away, nobody would doubt that he would be entitled to compensation. These are injuries to the particular individual quite apart from any that may be sustained by the public at large. If the entire destruction of the Claimant's access by raising or lowering or diverting the road gives a cause of action or a right to compensation, I am at a loss to understand upon what principle it can be contended that the obstruction of a substantial part of it does not give the same right of action and compensation. In the one case the premises would be of no value; in the other, their value would be substantially diminished. It is only a question of degree.

Mr. Justice Willes goes on to state the tests applicable to determine compensability of injurious affection claims where there is no taking in the context of the Lands Clauses Consolidation Act (1845), Section 68:

The first two conditions (a and b) are essentially the same as what we now know as steps 1 and 2 of the four-step test. The third and fourth (c and d) comprise what is now known as step 3 of the four-step test. The "construction" rule which has come to be known as the fourth step in the four-step test (see Ricket) is not stated here.

Mr. Justice Willes had no difficulty in finding that the injury occasioned in this case was one to the property itself, and makes the point that persons not expropriated-from may suffer as much loss as those from whom land was taken. He says at page 95:

... when you talk of damage to an estate, you equally damage it whether you cut off an angle of it which may be the least desirable to a purchaser, or take away from it a substantial advantage in respect of which it will fetch less in the market than it would have done with that advantage.

He goes on to say:

Here, however, damage is sustained by the estate in the sense that it would sell or let for less; and that is a damage to which it is subject in the hands of any owner who may from time to time possess it.

In determining the answer to his second test, Mr. Justice Willes relied on the proposition that an action would lay, in the absence of statutory authority for constructing the works, in the event that the plaintiff "did necessarily suffer a special damage more than the rest of the King's subjects ..." (the ordinary test for a claim based on public nuisance).

This case marks the last gasp of the "literal" interpretation of section 68 - holding that section to be procedural. It also established a distinction between use and construction of the works in question, insofar as compensability of any consequences from either is concerned.

A strong dissent by Lord Cairns points out that, assuming Section 68 of the Lands Clauses Consolidation Act is read to be substantive and not procedural, there is no statutory authorization for limiting claims for compensation for injurious affection with no taking by restricting compensable claims to those arising out of the construction, and not the use of the works. Lord Cairns' dissent in this decision can be read together with the dissent of Lord Westbury in the Ricket case.

Although not based on the provisions of the Lands Clauses Consolidation Act (1845) this decision is of interest because it is again a case, where there was a statute allowing compensation for persons sustaining damage by reason of the exercise of the powers given under the Public Health Act, in which consideration was given by the Court to the fact that the plaintiff in this case suffered particular or special damage. Mr. Justice Hannen, in delivering the decision of the Court said:

The raising of the level of a street may be very advantageous to the majority of the houses in it, but very injurious to one.

In this decision compensation was awarded for the reduction in value of property pursuant to Section 68 of the Lands Clauses Consolidation Act. The claimant was the occupier under a lease from the Crown of an estate, the garden of which ran down to the Thames River. Pursuant to the Thames Embankment Act the respondent effected certain works, which did not involve a taking from the lands occupied by the claimant, resulting in a dry area being created between the bottom of the Duke's garden and the River Thames. On that dry area a roadway was constructed which, to the satisfaction of the arbitrator, reduced the value of the claimant's leasehold interest. This case turns to some extent on the issue of riparian rights, and as well the issuance of noise and dirt and dust from the highway. The House of Lords also seems to have taken into account the loss of privacy resulting from the existence of the road.

I cannot but observe in a case like this, that, whenever it appears that the case is one in which it is plain that very serious injury may have been done to the premises of the party claiming compensation, I think that we must put a liberal construction upon the Acts of Parliament before us in determining the points raised. Unless it is perfectly clear that the language is not sufficiently ample or extensive to embrace the case in question, we ought to hold that a party whose property is injuriously affected, and to a very great extent, by the operations of a public body, shall be entitled in a Court of law to compensation.

Mr. Justice Willes, in considering an earlier decision, expressed in a dramatic vein the same view of statutory interpretation by saying, at page 156 of the report:

The Court came to the conclusion that they had not an arbitrary discretion and that it never could have been intended that any of the householders should pay a rate of 1 shilling sixpence in the pound in order to have their houses buried underground, and their windows and doors obstructed.' The Court in giving judgment went on to say that had Parliament intended to demolish or render useless some houses for the benefit or ornament of the rest, it would have given express powers for that purpose and given an equivalent for the loss that individuals might have sustained thereby.

This case, which seeks again to construe Section 68 of the Lands Clauses Consolidation Act (1845) is a high water mark insofar as the liberal view of compensation is concerned. The Law Lords went to some lengths to distinguish the Ricket case (they called it explaining and affirming, but the damage to the Ricket principle was significant). The Plaintiff owned property near the River Thames. Near his premises was a backwater which allowed access to "the great water highway of that river". The Thames Embankment Authority conducted certain works which eliminated the water access the Plaintiff had to the public dock on the backwater.

The Plaintiff alleged that the value of his premises was reduced by the fact that access to the river was no longer available, at least in the convenient way it was before the works pursuant to the Thames Embankment Act. The House of Lords flirted with the principle of "compensation for an injury" in line with the dissenting opinion of Lord Westbury in the Ricket case (in which Lord Westbury stated that there is nothing in Section 68 of the Lands Clauses Consolidation Act (1845) which requires that a person, to claim injurious affection only, must show himself to be more significantly affected by the works than other persons in the general community) but eventually satisfied themselves by distinguishing the Ricket case and other cases denying compensation on the grounds that in those cases only an injury to the income of the proprietor was at issue, as opposed to injury to the value of the property itself. This is an excellent example of the creative reasoning we find in cases dealing with injurious affection with no taking - lessening of the value of the premises must of course result directly from a lower income attributed to the construction of the works.

The issue is this - if the test for compensability under Section 68 of the Lands Clauses Consolidation Act (1845) is whether or not an action could have been brought against the promoters, had the works in question not been made lawful by the existence of the statute, then at common law such an action would have been available only if it was a "private right" infringed - that is, a particular damage suffered by the Claimant as opposed to the damage inflicted on the whole community by the works. The Lord Westbury view, in the Ricket case, is that Section 68 of the Lands Clauses Consolidation Act (1845) makes no such test a requirement, and that the Judges who found such a test to be appropriate in the past had misconstrued the law.

Clearly what was intended by the courts, having created the mischief themselves by ignoring Section 63 of the Lands Clauses Consolidation Act and holding Section 68 not to be simply procedural, was a mechanism, not found within the ambit of the Lands Clauses Consolidation Act (1845) which would limit the scope of claims for injurious affection with no taking arising out of public works. That is the value of the "actionable at common law in the absence of statutory protection" test.

The Law Lords in the McCarthy case took an extremely liberal view. They went so far as to hold that the special or particular damage suffered by a plaintiff, in order to allow the plaintiff to be successful, need not be a qualitative difference, but only a quantitative difference in effect upon him of the works.

The House of Lords also accepted that infringement of any right, whether public or private, although qualified by "something peculiar to the right in its connection with the house did distinguish it from that which is enjoyed by the rest of the world" would give rise to a claim for injurious affection under Section 68. This is of course circular reasoning. Private nuisance would be compensable at common law. Unique injury to a particular plaintiff makes a public nuisance compensable at common law. The court found the Ricket case to be clearly distinguishable in that it dealt with loss of income to the proprietor of the premises only, as opposed to a loss of value suffered by the land. Lord Penzance said, at page 262:

It may reasonably be inferred that the Legislature, in authorizing the works, and thus taking away any rights of action which the owner of land would have had if the works had been constructed by his neighbour, intended to confer on such owner a right to compensation co-extensive with the rights of action of which the statute had deprived him. But on no reasonable ground, as it seemed to me, can it be inferred that the Legislature intended to do more, and actually improve the position of the person injured by the passing of the Act.

He went on to say:

The question then, is, whether when a highway is obstructed, the owner of those lands which are situated in a sufficient degree of proximity to it to be depreciated in value by the loss of that access along the highway which they previously enjoyed, suffer a special damage 'more than' and 'beyond' the rest of the public. Surely it cannot be doubted but that they do.

If, then, the lands of any owner have a special value by reason of their proximity to any particular highway, surely that owner will suffer special damage in respect of those lands beyond that suffered by the general public if the benefits of that proximity are withdrawn by the highway being obstructed. ... It was asked in argument where are the claims to compensation to stop if the rule be so applied? The answer I think is, that in each case the right to compensation will accrue whenever it can be established to the satisfaction of the jury or arbitrator that a special value attached to the premises in question by reason of their proximity to, or relative position with, the highway obstructed, and that this special value has been permanently destroyed or abridged by the obstruction. If this limit be thought a wide one, and the number of claimants under it likely to be numerous, that is only the misfortune of the undertaking, for the limit does not exceed the range of the injury. On the other hand, all claims for compensation will vanish as, receding from the highway, the case comes into question of lands of which (though their owners may have used the highway and found convenience in so doing) it cannot be predicated and proved that the value of the lands depends on the position relative to the highway which they occupy.

Lord Penzance then justified his rather wide-ranging conclusion by stating that he relies on the Chamberlain v. Crystal Palace Company decision.

Lord Chelmsford, in an apparent excess of zeal, says at page 256:

After the many irreconcilable decisions upon the compensation clauses in the Lands Clauses Consolidation Act..., I think we may be said to have arrived at some settled conclusion upon the subject. It may be taken to have been finally settled that in order to found a claim for compensation under the Act there must be an injury and damage to the house or land itself in which the person claiming compensation has an interest.

This is another in the series of access cases. Lord Blackburn, at page 209, refers to the difficulty of limiting claims made for compensation for injurious affection with no taking, at page 299, when he says:

Now I do not dispute that an obstruction to a highway may be so distant from lands, that no one can reasonably find that the lands were appreciably damaged by the obstruction, but I think it unnecessary to try to give a definition of that distance. It is enough to say that in this case the distance is no too great.

Lord Watson says at page 303:

When an access to private property by a public highway is interfered with, the owner can have no action of damages for any personal inconvenience which he may suffer, in common with the rest of the lieges [when no claim lies for public nuisance at common law]. But should the value of the property, irrespective of any particular uses which may be made of it, be so dependent upon the existence of that access as to be substantially diminished by its obstruction, then I conceive that the owner has, in respect of any works causing such obstruction, a right of action, [a claim lies in public nuisance] if these works are unauthorized by Act of Parliament, and entitled to compensation under the Railway Acts [read here the Lands Clauses Consolidation Act], if they are constructed under statutory powers.

A predecessor version of what we now refer to as the four-step test is stated by Lord Selborne at page 276 where he says: