A shade too close for comfort

Most regeneration projects, and especially those on tight city centre sites, must seek to maximise densities to ensure projects are commercially viable and represent a sound investment. Right of light appraisals can help investors determine whether a site will be able to deliver a sufficient return and can be instrumental in informing the design process in order to maximise a project’s value while reducing or removing risk of claims.

Who has the right to light?

Right of light relates to neighbouring properties that will be affected by a new development. Where the light levels will fall below adequate or, where the light is already below adequate, there will be a further reduction, this can lead to an actionable nuisance. Those affected can seek an injunction causing an amendment to the proposals and/or can claim damages to be compensated by the developer for the loss of value that the reduction in light may cause.

Directly related to rights of light, and especially important in residential-driven mixed-use schemes, are daylight and sunlight factors. These have an effect on planning, design and, of course, the environment. Over-reliance on artificial light damages the sustainable credentials of developments, which in turn can impact on the BREEAM or Code for Sustainable Homes ratings that are achievable.

Dealing with rights of light

Some developers have historically dealt with rights of light post-planning as part of site assembly issues but as neighbours become more aware of their rights, an increasing number of claims are coming forward seeking an injunction or damages. Historically, very few of these claims have progressed to court so the extent of rights of light related disputes and the related costs are not widely appreciated. This is changing as, in the last few years, a number of well publicised claims have reached the courts.

In exceptional circumstances, the courts do have a discretionary power to award damages in lieu of an injunction, but the default remedy for significant right to light injury is an injunction to stop the work or pull down the offending part of the building. This can have disastrous consequences for a regeneration project in terms of delays and costs. The injunction may sound dramatic, but for a case in 2006, Regan vs Paul Properties, this was the outcome for one residential scheme.

The cost of settlement and litigation is, in itself, a strong argument to deal with rights of lights issues at the business case stage, or the beginning of the design process at the latest. If the extent of the impact can be evaluated and the level of opposition established, a decision can be made to include a contingency in the budget to cover the costs or to walk away from a site purchase altogether.

Another benefit of early consideration of rights of light is that concerns of neighbouring property owners can be managed. Developers can start a dialogue in good time demonstrating respect and openness, rather than a more high-handed and un-neighbourly approach, which may be perceived if the proposals progress too far before dialogue begins. Not only does this set a good example and help improve the developer’s overall reputation, it has been demonstrated in recent cases, most notably Midtown, that the courts may be more inclined to award damages in lieu of an injunction where an open approach is taken.

Beyond the legal and financial arguments, there are other benefits too in terms of maximising the value of the development and the use of the site. Right of light issues naturally influence the concept and critical mass that can be achieved on urban sites - they can determine the scope of a development in terms of size, height and form. Architects must have access to this information at the start or there is a risk that their design, while delivering the objectives, will be unrealistic and unachievable from a right to light perspective. Projects, especially city centre regeneration schemes, must be designed in context with acknowledgement of the constraints posed by neighbouring properties.

If right of light matters are left until later in the process, a scheme design may need to be changed, leading to delays, escalating costs and a lower return on investment. Similarly, when considering a purchase of a site, right of light constraints may determine whether a required return can be achieved.

A matter of balance

Rights of light issues should be dealt with early because of the benefits and value this approach brings. It is important not to focus too much on the fear of litigation because this is still relatively rare and, by taking the right approach to rights of light, can usually be avoided. Developers exist to make money and profitability should not be reduced unnecessarily. What is needed is a balance.

High-quality rights of light advice must be taken and speed of response with any conflict that arises can be paramount. Good advice will flag up possible problems, enabling potentially profit-jeopardising rights of light issues or daylight and sunlight planning difficulties to be avoided, and may also propagate profit-boosting alterations to a development. With rights of light, methods to prevent acquisition and even extinguish existing rights are sometimes available and these often need to be flagged up at the earliest opportunity to be effective.

Ultimately, right of light matters represent both an issue to be addressed and an important part of the developer’s armoury to put in place, which, if managed well, can be critical in maximising the development opportunity, safeguarding value and dealing with any impact on neighbouring properties.