By James McAllister FRICS
James Holton, Solicitor
Philip Byrne, Barrister
In our last article we questioned whether a recent High Court decision could render the Party Wall etc. Act 1996 (“the Act”) obsolete. This was on the basis the court had decided that, absent a notice served by a building owner on an adjoining owner ahead of implementing ‘notifiable’ works, the Act could not be invoked. The implications of this being that party wall surveyors could not be appointed and adjoining owners would be unable to enjoy the protective measures otherwise provided by the Act. It would also mean building owners could not enjoy certain ‘rights’ only available by complying with the Act.
Of perhaps greatest significance, however, is that it would force unnotified adjoining owners to look beyond the Act for a remedy.
The case was Shah v Power and Kyson  EWHC 209 which questioned whether an award made by two party wall surveyors appointed in the absence of any notice was legally valid. In this case, a building owner had carried out works deemed to be ‘notifiable’ under the Act without serving the adjoining owner with prior notice of his intention to do so in accordance with the Act. To compound matters, the works also caused damage to the adjoining owner’s property. The aggrieved adjoining owner then appointed a party wall surveyor (Kyson) and the building owner was invited to do the same. However, the building owner declined to appoint a surveyor, so the adjoining owner’s surveyor appointed one for him (Power). The two surveyors then proceeded to make an award to deal with the damage and their fees, which they later sought to enforce.
The building owner successfully appealed the award in the County Court where it was adjudged to be null and void. Not satisfied with the legal reasoning presented by the County Court judge, Power and Kyson appealed to the High Court who upheld the decision at first instance. Again, unsatisfied with the decision of the High Court, Power and Kyson succeeded in persuading the Court of Appeal to hear the case on the basis it raised important points of statutory interpretation. And so it did. Unfortunately for the appellants, the outcome was the same: ‘No notice, no Act’ (now Power and Kyson v Shah  EWCA Civ 239).
Dispute must follow notice
Whilst it was argued, by the appellants, that the Act provides an effective means of dispute resolution between neighbouring owners, the court remained undeterred in its view that the dispute resolution provisions of the Act only take effect following a ‘dispute’ pursuant to a notice, thus adopting a literal, rather than purposive, approach to statutory interpretation. The court also took the view that this approach is of no real detriment to the adjoining owner since common law remedies are still available.
It is arguable that this decision is of detriment to the unnotified adjoining owner since it shifts the burden on to them to pursue such remedies. This will undoubtedly entail the cost of engaging a lawyer or surveyor to provide initial advice and then to escalate matters as necessary. In the case of injunctive proceedings, it is inevitable the adjoining owner will have to give a cross undertaking for costs/damages in the event it is later found that injunctive relief was unwarranted, all of which would be unnecessary if notice had been provided from the outset. Notwithstanding this, such action may still be a risk worth taking.
Importantly, the court noted that, in the absence of notice, it was not for the adjoining owner to unilaterally invoke the dispute resolution procedure provided by the Act. So, what remedies might an adjoining owner have under the common law?
Common law remedies
The aggrieved adjoining owner may still have the right to bring a claim for trespass (e.g. building astride the boundary), for nuisance (e.g. removal of a right of support), for negligence (e.g. damage to property from carelessness) and for breach of statutory duty (e.g. for failing to serve notice and comply with the Act). If bringing a claim, the adjoining owner should consider instructing a party wall surveyor to prepare a schedule of condition of their property as soon as possible in order to preserve factual evidence of condition.
Where the Act cannot be relied upon, an adjoining owner successful in bringing proceedings will push hard for an order from the court allowing them to recover a significant proportion of their costs from the building owner. Indeed, in such circumstances, the adjoining owner will have a strong argument to recover all their costs (legal and professional) on a full indemnity basis. Clearly, it would be less costly for the parties to rely upon the Act's dispute resolution procedure rather than to engage in litigation, but that clearly relies on mutual cooperation.
Of course, it is worth revisiting the fact that the Act is an 'enabling' piece of legislation designed to afford certain 'rights' to those who participate, rights which would not be available if the Act did not exist. Although the Court of Appeal's decision in Power and Kyson v Shah  might be seen as a 'rogue's charter' - an excuse by deviant building owners to run roughshod over the Act and build as they please - the risk of falling foul to an adjoining owner brave enough to take action could have costly consequences, as demonstrated in Nutt v Veda Road Limited and Podger  (Unreported).
James McAllister FRICS is a director of The Party Wall Consultancy
James Holton is a Senior Associate at DTM Legal LLP
Philip Byrne is a barrister at St.John’s Buildings
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