What Does The Decision In Power & Kyson v Shah Mean For Homeowners?
Historically there has been a lack of authority outlining the powers available to an adjoining owner when a neighbour commences works without adhering to the process outlined in the Party Wall Etc. Act 1996 (PWA). The recent Court of Appeal decision in Power & Kyson v Shah  EWCA Civ 239 has clarified this position. We review the implications this has on homeowners.
Understanding the Party Wall etc Act 1996
Under the PWA a building owner is required to serve a Party Wall Notice to inform the owners of their adjoining property of any major intended building work impacting their Party Wall. This includes constructing a new building or wall on the boundary line; making an existing Party Wall taller, shorter or deeper; cutting into a Party Wall; knocking down and rebuilding a Party Wall and excavating ground within six metres from any part of a building or structure on neighbouring land.
An adjoining owner receiving the notice can consent to the works or, if they have any concerns, they can refuse consent and you enter into a dispute resolution process. This requires the appointment of a surveyor. Either jointly instructed on behalf of both parties or individually appointed. Either way, the surveyor(s) will work to resolve the concerns on both sides to ultimately draw up a Party Wall Award. This is a legal document outlining what can happen, under which restrictions and which party is responsible for paying each cost.
Through deliberate abstention or unfamiliarity with the act, a Notice is often overlooked and notifiable works are started without a Party Wall Award. In such circumstances, there has been uncertainty around options available to the adjoining owner affected by the works. In particular, if the dispute can be resolved following the dispute resolution process set out in section 10 of the Act or if the client must alternatively look to obtain a remedy through nuisance, trespass or another common law principle.
The facts and decision of the case
After being given incorrect advice, the building owner (Mr Shah) failed to serve a notice before starting notifiable work on his property. This caused damage to his neighbour’s home who appointed a party wall surveyor. In accordance with the procedure in the PWA, they subsequently appointed an additional surveyor for Mr Shah. Both concluded that their work was notifiable under the Act and made a Party Wall Award for compensation to cover the cost of the damages made to the neighbour’s property and the surveyor’s charges.
When Mr Shah failed to pay the fees, the surveyors sought enforcement from the Magistrates Court. Mr Shah challenged this by claiming that as no Notice was made, the Act could not apply and the Award was void. The case ultimately concluded in the Court of Appeal, which decided in agreement with Mr Shah that as there was no Notice, the Act and its dispute resolution process did not apply.
What does this mean for homeowners?
Specifically, they will not be able to rely on the protection from the Act when a neighbouring building owner fails to serve the necessary Notice. This means they cannot utilise the efficient and cost-effective Party Wall Award process to resolve any dispute which arises. Instead, they need to rely on common law principles such as nuisance, trespass and injunctions for any remedies.
These solutions are significantly more expensive, more time-consuming and are accompanied by greater risks than the efficient dispute resolution provisions provided by the Act. This may expose the adjoining owner to intimidatory tactics by neighbouring property owners and developers. They could take advantage of an adjoining owner’s reluctance to fund expensive and extensive litigation proceedings and refrain from invoking the PWA by not serving any Notice. However, for an average homeowner wanting to commence work on their property, it is a risk which would be ill-advised to take.
Despite the ruling, an aggrieved adjoining owner can also still rely on the PWA by seeking an interim injunction to pause the works, while the PWA process is started. However, not only does an adjoining owner have to work quickly to get through the legal hurdles and obtain an injunction in time to halt any work, but they also need to pay the associated initial legal costs for doing this. This is a significant deterrent for most.
In spite of the decision, it is still highly advisable for the adjoining owner to not overlook the PWA process of obtaining a Schedule of Conditions. This will still prove significant evidence should any damage to the property occur.
If a Notice is not served, it will also have repercussions for the building owner. In particular, should they fail to serve a Notice for notifiable works they will lose the benefits under the Act. This includes any rights of access to the neighbouring property, adding costs and complexities to the build and risking further legal costs should they or their contractors not comply. Additionally, to mitigate any strategic withholding of the PWA process by developers or homeowners, there is pressure for liability of indemnity costs to be enforced when they fail to serve Notice. This will irradicate any financial barriers for adjoining homeowners to take legal action.
Whilst the outcome of the case might make it tempting for a homeowner to refrain from following the PWA process, it is still not advisable. Following the process not only retains neighbourly relations, it also mitigates risks of future legal battles. Therefore, if you are planning works which impact a Party Wall, ensure that you continue to set aside the time and budget to cover the PWA process.
How can we help?
There are a number of ways we can assist in all parts of the process relating to the PWA.
If you are the building owner and your neighbour has accused you of breaching an agreement, concerning your respective properties, we can work with you to understand and resolve the dispute. We can also help defend your party wall rights. We will work to settle any disputes efficiently, so you can carry on with your works as quickly as possible.
If you are an adjoining owner and your neighbour has served you with a Party Wall notice and you are not sure what you should do, we can advise on how you can proceed and how you might be protected. Alternatively, if your neighbour has commenced work which you believe to be affecting a Party Wall and they have not served you notice, we can help you to obtain an injunction to prevent them conducting any further works, while we help to resolve the dispute.
We will be happy to discuss any concerns relating to the PWA on a no-cost no no-obligation 20-minute video call with one of our solicitors in our Haywards Heath office. To book this call please send an initial email to email@example.com (with a brief description of the matter) and one of our team will liaise with you to fix a time to speak to an appropriate specialist and send you a calendar invite accordingly.
This article is intended for general information only, applies to the law at the time of publication, is not specific to the facts of your case and is not intended to be a replacement for legal advice. It is recommended that specific professional advice is sought before relying on any of the information given. © Jonathan Lea Limited 2023.