Metropolitan Housing Trust Ltd V RMC FH Co Ltd (2017)
The release by the headlessee of a property to the developers of an adjoining site of the right of light appurtenant to the headlease would amount to an encroachment on or against the demised premises in breach of the terms of the headlease.
The headlessee of a property sought a declaration that it was entitled to release the right of light appurtenant to the headlease to the developers of an adjoining site.
The headlessee and the defendant freeholder of the property both considered that they enjoyed a right of light from windows facing the site and that the development would lead to an actionable interference with the use and enjoyment of that light. They asserted that the right came into existence under the Prescription Act 1832 s.3. The headlessee wanted to release its right of light for compensation. The freeholder argued that the right of light was part of "the demised premises" and that interference with that right would be a breach of cl.3(12) of the headlease, which provided that permission was not to be given for "any new window light opening doorway ... or other encroachment ... which might be or grow to the damage annoyance or inconvenience of the landlord". The clause also obliged the headlessee "to adopt such means as may be reasonably required or deemed proper for preventing the making of such encroachment". The parties' contentions addressed two different subjects: the right of light in relation to (a) the windows of the property and; (b) to any windows created in the development building which would enjoy the use of light passing over land which was the subject of the headlease.
Was the right of light part of "the demised premises"? Yes. The right of light had not existed at the date of the lease, but came into existence 20 years after the installation of the windows facing the development site. Where a dominant tenement was subject to a lease, the acts of user by the lessee relied on to support a claim to an easement acquired by prescription were treated as acts of user by the freehold reversioner, and would lead to the acquisition of an easement appurtenant to the freehold, Pugh v Savage  2 Q.B. 373 followed. Whether acquired by prescription based on the principles of lost modern grant, or on s.2 of the 1832 Act, the easement acquired as appurtenant to the freehold was to be treated as being the subject of the demise to the lessee, even though the actual demise had been made prior to the easement being acquired. The right of light acquired under s.3 was a right appurtenant to the freehold and was treated as demised to the lessee under the lease. The phrase "the demised premises" was not confined to corporeal hereditaments, as it was defined to include the right of support expressly granted by the lease. As the right of light was treated as having been demised by the freeholder to the headlessee, it was part of "the demised premises" (see paras 25-36 of judgment).
Would release of the right of light involve an encroachment on or against the demised premises? Yes. The erection of the building on the site resulting in an actionable interference with the right of light would be an encroachment on the right of light. As "the demised premises" in cl.3(12) included the right of light, such interference would be an encroachment on or against them. A release of the right of light would be contrary to cl.3(12) if the further requirement of cl.3(12) relating to the effect of the encroachment on the freeholder was satisfied. That conclusion was reached on the basis of various factors (paras 37-41).
Might the infringement of the right of light appurtenant to the headlease "be or grow to the damage annoyance or inconvenience" of the freeholder? Yes. If there was an interruption of light in the near future, even if the freeholder continued to have a right of light at the end of the headlease, the fact that the interruption had continued for many years would significantly reduce the freeholder's ability to obtain an injunction requiring the removal of the obstruction to the light. There was insufficient evidence to decide that the developer would encroach on the rights of light appurtenant to the headlease. However, if the development would amount to a substantial interference with that right of light, so that a release of rights by the headlessee was necessary to avoid an infringement of those rights, it would follow that the development would involve an encroachment within cl.3(12), and that release would amount to permission for such encroachment and a breach of cl.3(12). That was subject to the qualification that if the freeholder released its right of light, no breach would be committed by the headlessee subsequently releasing the right of light appurtenant to the headlease (paras 42-47).
Could the freeholder require the headlessee to take action? Not necessarily. The freeholder's ability to require the headlessee to take action only arose if the requirement was "reasonable" or "deemed proper", which would usually give rise to similar considerations. Such a question would have to be answered when such a requirement was made (paras 48-57).
Would a release by the headlessee amount to a permission to the developer to create new windows in the development site building? Not necessarily. It might be that the developer would also want permission to create new windows, but it should be possible to draft a release which dealt only with the release of the right appurtenant to the headlease (paras 60-65).
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