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Archive for April, 2014

Release from the shackles of Shelfer?

Historically, the courts have upheld property rights or opposed a nuisance by the grant of an injunction.  However, since the passing of Lord Cairns’ Act in 1858, judges have had a discretion to award damages in lieu.  In exercising this discretion, AL Smith LJ, in his Court of Appeal judgement in Shelfer v City of London Electric Lighting Co (1895) 1 Ch 287 stated it to be a “good working rule” that

  1. “If the injury to the plaintiff’s legal rights is small,
  2. And is one which is capable of being estimated in money,
  3. And is one which can be adequately compensated by a small money payment,
  4. And the case is one which it would be oppressive to the defendant to grant an injunction

- then damages in substitution for an injunction may be given.”

What became known as “the Shelfer rule” became infamous in recent rights to light cases (see for instance HKRUK II v Heaney -see our November 2012 newsletter) when judges ordered the removal of parts of an offending building even though built, let and despite the fact that the claimant could have commenced its action at an earlier date.

The Supreme Court in Coventry & Others v Lawrence and Another [2014] UKSC 13 has been critical of the Shelfer rule.  Lord Sumption said “In my view, the decision in Shelfer is out of date, and it is unfortunate that it has been followed so recently and so slavishly”.  Lord Neuberger said “… it is right to emphasise that, when a judge is called on to decide whether to award damages in lieu of an injunction, I do not think that there should be any inclination either way … the outcome should depend on all the evidence and arguments”.  He recognised that “Given that we are changing the practice of the courts, it is inevitable that, in so far as there can be clearer or more precise principles, they will have to be worked out in the way familiar to the common law, namly on a case by case basis.”

So, judges are released from the shackles of the Shelfer rule but at the cost of a degree of uncertainty in the law.  We will watch future cases with interest.

Wish to hear more?  Why not contact Hatherleigh Training?