On the Sixth day of Christmas - Amy Greenhill

On the Sixth day of Christmas….Today Amy Greenhill from Irwin Mitchell’s Real Estate Disputes team examines whether an owner of an adjoining premises can rely on the dispute resolution procedure pursuant to section 10 of the Party Wall Act 1996 where the building owner either has or intends to carry out the works and has not served a section 3 notice under the Act.

The Court of Appeal considered whether an owner of the adjoining premises could rely on the dispute resolution procedure pursuant to section 10 of the Party Wall Act 1996 (“the Act”) in circumstances where the building owner either has or intends to carry out the works and has not served a section 3 notice under the Act because they allege that the Act does not apply.

The Court held that section 10 of the Party Wall Act 1996 was only available where a section 3 notice had been served in advance of proposed works to a party wall.

Factual Background

My Shah (the Respondent) completed works on his residential premises but did not serve a notice pursuant to section 3 of the Act because he was informed that the works did not fall within the scope of the Act. The adjoining owners of the premises alleged that they had suffered damages as a result and appointed Lee Kyson to act as their surveyor. Pursuant to s10(4) of the Act, Mr Kyson appointed Ken Power as surveyor for the Respondent, as a result of Mr Shah not engaging in the statutory process. 

An award was issued on 3 July 2018 by the appellants stating that the works carried out by the Respondent required notice under the Act, that the works had caused damage and the Respondent was to pay the adjoining owners compensation of £4,223,49.

The High Court held that section 10 of the Act did not apply as the Respondent had not served a notice and thus had not triggered the Act for the following reasons:

1. The rights conveyed under section 2 of the Act were dependant on a notice being served under section 3;
2. There is a direct link between section 3 and section 10 such that it could only be triggered if a section 3 notice was served; 
3. The purpose of the Act was to avoid disputes altogether by utilising section 3;
4. A unilateral right to trigger section 10 is not expressed in the Act; and
5. The owners of the adjoining premises were not left without a remedy for the damage and were entitled to pursue other common law remedies.

Why is this important

The Respondent, rightly or wrongly, was advised that the intended works did not fall under the Act and therefore was not required to comply with the statutory requirements. As a result, the adjoining owners could not use the Act as a form of dispute resolution procedure and their only remedy would be common law remedies such as nuisance or damages, which would be determined by the Court. 

It is an important reminder that when advising adjoining owners who has had works carried out on their adjoining property, if the works are not pursuant to the Act and if they did not receive a notice pursuant to section 3 of the Act, only common law remedies apply and the dispute resolution procedure under section 10 of the Act is not available.