Prime London Holdings 11 Ltd v Thurloe Lodge Ltd [2022] EWHC 303 (Ch)

Summary

In the first time it has been considered by the High Court, it made an access order under section 1 of the Access to Neighbouring Land Act 1992 (the Act) and provided extensive guidance on when an access order should be made, the terms of such an order and what compensation would be payable.

The facts

This case involves two prime properties in South Kensington opposite the Victoria & Albert Museum: Amberwood House owned by the Claimant and Thurloe Lodge owned by the Defendant. Both properties are subject to substantial redevelopment projects.

The Claimant's sister company owns a short private road that gives access to both properties. Despite initial co-operation, the parties engaged in a dispute over access rights. Separately, the Claimant required access to the Defendant's land to re-render and repaint a wall forming part of the Claimant's property. This was refused and proceedings were commenced.

The Court held that an access order should be granted in these circumstances.

Legal test

The Court set out five questions that needed to be considered:

Stage 1

• Question one: Are the works reasonably necessary for the preservation of the whole or any part of the claimant's land? Basic preservation works do not need to be urgent to be reasonably necessary and a broad view should be taken.
• Question two: Would it be impossible, or substantially more difficult, to carry out the works without entry to the other land? If the answer to questions one or two is no, no access order will be made. If the answer is yes, the Court must consider questions three and four.

Stage 2

• Question three: If the order is granted, would the adjoining owner or any other person suffer interference with, or disturbance of, their use or enjoyment of the adjoining land? This extends beyond the adjoining owner and includes an occupier (such as a contractor).
• Question four: If the order is granted, would the adjoining owner or any other person occupying the land suffer hardship? Hardship must be more than mere inconvenience. Although it can include financial hardship, the ability to receive compensation under the Act can negate this.

If the answer to questions three and four is no, an access order will be made. If the answer is yes, the Court must consider question five.

Stage 3

• Question five: Would the interference, disturbance or hardship arising from entry onto the land occur to such a degree that it would be unreasonable for the court to make the order? The Court must balance the interference, disturbance or hardship against the detriment suffered if an access order is denied and reasonably necessary works cannot be carried out.

Compensation

The Court can award compensation in exchange for granting an access order on one, or a combination, of the following approaches:

• Forward-looking basis: ordering payment of a specific sum, or a sum to be calculated on a specific basis.
• Backward-looking basis: permitting the adjoining owner to claim losses or damage actually incurred once suffered and quantified.

Although the Act states that an access order may require the claimant to pay the adjoining owner a fair and reasonable sum for the privilege of entering the adjoining owner's land, this does not apply where the works are to residential land. This applied here even where the property was being substantially redeveloped, was unoccupied and owned by a property development company.

The decision

The Court granted an access order and gave detailed guidance about its terms. In particular, the Court set out principles that must be adhered to, including:

• the adjoining owner should be fully compensated for any loss, to the extent that such loss could not be avoided by taking reasonable steps to minimise its loss
• if there is a choice in the way in which the works are carried out, the usual starting point is that the adjoining owner should be entitled to insist that the method involving the least inconvenience to it is adopted
• the amount of compensation and the principles on which compensation should be calculated will depend on the stage at which the works are undertaken by the party requiring access.

Our comment

The Court was critical of the time and cost involved in agreeing the terms of access and was of the view that the "Biblical precept to 'love thy neighbour'" would have avoided this.

This case contains detailed and helpful guidance about the application of the Act but ultimately illustrates the disproportionate consequences associated with refusing access in certain circumstances. Landowners who are on the receiving end of a request for access should give careful thought before refusing such a request.