A homeowner claimed damages for residual diminution in property value caused by Japanese Knotweed encroaching from council land. The Supreme Court held the diminution predated the council’s breach of duty (2013–2018) and was not caused by it, applying the ‘but for’ causation test. The appeal was allowed and no damages awarded.
Background
The respondent, Marc Christopher Davies, owned a terraced house at 10 Dinam Street, Nant-y-moel, Bridgend, Wales. His property adjoined land owned by the appellant, Bridgend County Borough Council. Japanese Knotweed (‘JKW’) growing on the council’s land had encroached onto the respondent’s land at some date ‘well before 2004’, prior to his purchase of the property and well before any actionable breach of duty by the council.
The council’s breach of the relevant duty in private nuisance was found to have commenced in 2013, when it was or ought to have been aware of the risk of damage from JKW following the publication of the RICS 2012 information paper. It was not until 2018 that the council implemented a reasonable and effective treatment programme. Neither party appealed the finding of a continuing breach between 2013 and 2018.
In 2020, the respondent brought proceedings claiming damages in private nuisance, including £4,900 for residual diminution in the value of his land. This sum represented the reduction in market value that would persist even after treatment, due to the stigma attaching to land historically affected by JKW. The respondent’s expert, Mr Raine, attributed this to disclosure obligations on resale and market stigma, stating:
There is a real stigma associated with JKW in the current market, fuelled by media articles and internet discussion.
The Issue(s)
The main issue
The narrow and principal issue before the Supreme Court was one of factual causation: whether the residual diminution in value of the respondent’s land was caused by the council’s breach of duty in private nuisance between 2013 and 2018, or whether it had already occurred by reason of the non-actionable encroachment of JKW that took place well before 2004.
The claimant’s further issue
The respondent also contended that, had the council commenced treatment in 2013 rather than 2018, the stigma-related diminution would have decreased over time, and the difference between the diminution as at 2018 and what it would have been had treatment started in 2013 should be recoverable. The respondent argued the burden was on the council to establish this lower figure.
The Court’s Reasoning
The Court of Appeal’s approach and Delaware Mansions
The Court of Appeal had relied on Delaware Mansions Ltd v Westminster City Council [2001] UKHL 55 to hold that because the nuisance was continuing, the harm to the respondent’s quiet enjoyment and amenity persisted in 2018 and was therefore caused by the continuing breach. The Supreme Court held that this reliance on Delaware was misplaced. Lord Stephens explained:
Delaware establishes that where there is a continuing nuisance the claimant is entitled, in appropriate circumstances, to abate the nuisance and to recover the reasonable costs incurred in doing so. However, a loss representing a diminution in market value is not an aspect of reasonable costs incurred in abating a continuing nuisance. Delaware is not authority for the proposition that diminution in market value is recoverable, regardless as to whether the diminution occurred prior to the defendant’s breach of duty.
Application of the ‘but for’ test
The Supreme Court applied the standard ‘but for’ test of factual causation. Lord Stephens stated:
In the context of this case the ‘but for’ test asks: would the diminution in value of which the claimant complains have occurred ‘but for’ the wrongdoing of the defendant between 2013 and 2018? The answer to that question is to be seen in the context that there was no evidence and no finding by the district judge that the defendant’s breach of duty between 2013 and 2018 had increased or materially contributed to the diminution in value of the claimant’s land. In that context the answer to the ‘but for’ question is simply that the diminution in value had occurred long before any breach by the defendant of the relevant duty in private nuisance first occurred in 2013.
Lord Burrows, in his concurring judgment, reinforced the causation analysis by drawing an analogy with Performance Cars Ltd v Abraham [1962] 1 QB 33, where the Court of Appeal held that a defendant was not liable for damage to a car that already needed respraying before his negligent act. Lord Burrows quoted Lord Evershed MR:
the necessity for respraying was not the result of the defendant’s wrongdoing because that necessity already existed. The Rolls Royce, when the defendant struck it, was in a condition which already required that it should be resprayed in any event.
Lord Burrows further observed that the respondent had conceded at trial that the cost of JKW treatment was irrecoverable because it was not factually caused by the breach of duty, yet inconsistently did not extend that concession to the residual diminution in value. He stated:
in this case, the correct position as regards factual causation is that what applies to the cost of treatment applies equally to the residual diminution in value.
Rejection of the claimant’s further issue
The Supreme Court rejected the respondent’s further argument that the stigma decreases over time and that the relevant damages should represent the difference in diminution attributable to the delay in commencing treatment. Lord Stephens found this issue was not pleaded, was unsupported by any evidence, and that the burden of proving damages rested on the claimant, not the defendant:
the district judge would have acted quite improperly if he had made any award in favour of the claimant on a hypothesis, not pleaded and not supported in evidence, that the stigma causing the diminution decreases over time with the consequence that the amount of the diminution in value also decreases over time. In my view the hypothesis amounts to no more than conjecture.
The Court of Appeal’s analysis of Williams v Network Rail
Although the Supreme Court’s decision turned on causation, it is notable that the Court of Appeal’s clarification of Williams v Network Rail Infrastructure Ltd [2018] EWCA Civ 1514 was not challenged on appeal. The Court of Appeal had held that the district judge and circuit judge had misunderstood Williams v Network Rail by treating diminution in value as always constituting irrecoverable pure economic loss. The correct position was that where the elements of the tort of nuisance are satisfied through physical encroachment, damages for consequential diminution in value are in principle recoverable.
Practical Significance
This decision clarifies an important point of principle regarding factual causation in private nuisance claims involving natural hazards such as Japanese Knotweed. It confirms that the ‘but for’ test applies straightforwardly: where the damage complained of — here, residual diminution in property value due to stigma — occurred prior to the commencement of the defendant’s breach of duty, the breach is not a factual cause of that loss. A continuing nuisance does not, of itself, render the defendant liable for losses that pre-dated the period of actionable breach.
The decision is of particular importance to Network Rail, which intervened given its extensive landholdings on which JKW grows, and to local authorities and other landowners facing similar claims. It establishes that claimants must demonstrate that the specific loss claimed was factually caused by the defendant’s breach, and cannot simply rely on the existence of a continuing nuisance to recover for pre-existing diminution in value. The judgment also underscores that claims must be properly pleaded and supported by evidence, and that the burden of proof as to quantum of loss remains firmly on the claimant.
Verdict: The Supreme Court unanimously allowed the appeal. The Court of Appeal’s judgment awarding £4,900 in damages for residual diminution in value was set aside, and no damages were awarded. The residual diminution in the value of the claimant’s land had occurred prior to the defendant’s breach of duty and was not caused by it.
Source: Davies v Bridgend County Borough Council [2024] UKSC 15
