The role played by diminution in value in claims of nuisance involving Japanese knotweed recently came before the Court of Appeal. In Davies v Bridgend County Borough Council  EWCA Civ 80, the CA found that if the value of neighbouring property was diminished as a result of an interference with quiet enjoyment or amenity following the physical encroachment of knotweed from neighbouring land, damages in nuisance for diminution in value would be recoverable.
Prior to this decision it was not possible to claim against a neighbouring landowner for diminution in value due to the presence of knotweed post-treatment. As such, all landowners should always seek to eradicate knotweed as soon as possible, otherwise now risk potentially costly consequences.
What was the decision by the District Judge in Davies?
On the facts of the case, knotweed growing on the land owned by the local council (the Respondent) had been encroaching onto neighbouring land owned by Mr Davies (the Appellant), and for which the Appellant sought damages in nuisance for the residual diminution in value of his property.
At first instance, it was accepted by DJ Fouracre that from 2013 until 2018, when a reasonable and effective treatment programme had finally started, that the Respondent was in breach of the duty in nuisance owed to the Appellant as a neighbour. The question was whether this duty continued once the knotweed had been treated on the Respondent’s land. Mr Davies sought to recover the sum of £4,900 in damages to reflect the residual diminution in the value to his property after 2018.
In dismissing the claim, based on the CA’s decision in Network Rail Infrastructure Ltd v Williams and another  EWCA Civ 1514, the District Judge held that damages for diminution in value of the Appellant’s property were irrecoverable. In Williams, the court had decided that there was no actionable nuisance caused by knotweed simply because it diminished the value of the Claimant’s land. The purpose of the tort of nuisance was said to protect the owner of land in their use and enjoyment of that land, not to protect the value of property as either an investment or financial asset.
What was the decision by the Circuit Judge in Davies?
While HHJ Beard accepted that the diminution in value claimed was damage leading to a loss consequential on the nuisance identified by the court below, in dismissing the appeal he agreed with the District Judge that the decision in Williams was authority for the proposition that, as pure economic loss, damages for diminution in value due to knotweed are irrecoverable in nuisance.
However, given the number of knotweed cases, and because the point of principle about recoverability was important, the Appellant was granted permission to bring a second appeal.
What was the decision by the Court of Appeal in Davies?
In granting the second appeal, the CA revisited the reasoning in Williams upon which the judges below had relied on so heavily. In particular, in giving the leading judgment, it was highlighted by LJ Birss that the ratio of Williams is that there is no actionable nuisance caused by knotweed on a
Defendant's land simply because it diminishes the market value of the Claimant's land. The reason for this is a policy reason which characterises such a claim as one of pure economic loss.
However, this does not mean that in a case in which the elements of nuisance are already satisfied, a Claimant cannot recover for damage to their economic interests. The reasoning in Williams was said to be nothing to do with recoverability of damages in a case in which nuisance had been made out. As such, once it had been accepted that there was damage leading to a loss consequential on the nuisance, there was no authority that this damage to economic interests was irrecoverable.
The matters contained within this article are intended to be for general information purposes only. This blog does not constitute legal advice, nor is it a complete or authoritative statement of the law in England and Wales and should not be treated as such.
Whilst every effort is made to ensure that the information is correct, no warranty, either express or implied, is given as to its' accuracy, and no liability is accepted for any errors or omissions. Before acting on any of the information contained herein, expert legal advice should always be sought.
© Melissa Worth, April 2023