A test-case nuisance rights of light claim against the 19-storey, £35 million Arbor office tower at London's Bankside Yards development has been upheld in the High Court but the judge has thrown out an application for injunction against the development, in a decision with major implications for UK real estate.
Stephen and Jennifer Powell sued the developers behind the tower, which forms part of the £2 billion Bankside Yards development, in a case – Cooper v Ludgate House Ltd and Powell v Ludgate House Ltd – which could have ultimately seen the building demolished if the sought injunction was upheld.
The couple argued the tower has reduced the natural light coming into their sixth-floor apartment in the Bankside Lofts development on the South Bank which makes it hard for them to read in bed without a light on.
Co-developers of the site Ludgate House Ltd and Native Land fought the claims, saying that the tower does not block enough light to justify the case and arguing that the neighbours are trying to hold them to “ransom”. They argue demolishing the Arbor tower would be “a gross waste of money and resources”.
The wider development, overseen by Native Land, ultimately proposes eight towers, including some 50 storeys high, with Arbor being the first and so far only building completed between 2019 and September 2021.
A spokesperson for Native Land said in a statement: “We strongly welcome the judge’s decision to decline the Claimants’ application for an injunction, and his recognition that demolition of Arbor would be a waste of a ‘high quality, valuable resource in the form of a modern, net zero office building that brings considerable public and economic benefits to the area’. This is great news both for Native Land, our tenants, and Southwark in general.
“The decision to award only a small fraction of the damages that the Claimants had said they were seeking on the final day of trial, is likewise very positive for us and the Bankside Yards development as a whole.
“We are now working with our legal team to deal with matters arising from the judgment, and once they are resolved will be in a better position to provide further comment.”
Native Land’s legal counsel, Pinsent Masons, explained that although an actionable interference was established, the claimants were unsuccessful in their claim for an injunction and as such Arbor will not have to be demolished, nor will Native Land be required to make changes to the remainder of the buildings in the Bankside Yards scheme.
"The claimants were awarded damages in lieu of an injunction, assessed on a negotiating damages basis. However, the sums initially identified by the claimants (applying that basis) were said to be 'so obviously disproportionate to the value of the Claimants’ properties, the extent of the Claimants’ loss and the possible value of the light that they will lose, that the Claimants should have realised that the method they used to quantify the damages was wrong or wrongly applied'.
"Although the claimants presented lower figures for the first time at trial (calculated by reference to the cost of being able to purchase new properties), those sums were still found to be 'excessive'. Ultimately, the Court stood back and considered in the round whether these kinds of sums could reasonably have been negotiated and agreed, given the context, the nature of the rights being sold, and the impact on each party of not having those rights. Sums of £350,000 and £500,000 were awarded."
Reflecting on the wider implications Pinsent Masons said: "When considering the question of whether Arbor caused an actionable interference to the light enjoyed by the claimants’ flats, the Court found that you must ignore the light that is to be taken away by the remaining buildings in the proposed scheme even though those buildings have the benefit of section 203 of the Housing and Planning Act 2016 (such that the claimants’ rights of light over those buildings were not taken away but the claimants will be entitled to statutory compensation). Had that light been taken into account, there would have been no actionable interference. Fancourt J [the judge] expressed that he “had not found this an easy point to decide”.
"The widely used Waldram test for measuring the interference with rights of light lives on, although more modern technologies still have a place in those cases where the Waldram results are marginal or if those other methods produce contrasting results."
Kate New, partner at law firm Foot Anstey, has argued the case could "transform future real estate disputes and tip the scales defendants and claimants cling to". She added at the time that the case has given the claimants "almost veto power" over a major development.
At the end of last year Native Land announced Merlin Entertainments, the branded entertainment destinations group behind the likes of Alton Towers and Legoland, had expanded its office footprint at Arbor taking the remaining half of the 17th floor of the building after the southern half was leased by the multinational technology consultancy Wipro in April 2024.
The 222,000-square-foot Arbor is now over 75% let.