A Lifeline for Developers, Chelsea FC and the Walkie Talkie – a Way to Sidestep Rights of Light

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A Lifeline for Developers, Chelsea FC and the Walkie Talkie – a Way to Sidestep Rights of Light

September 26th, 2019, Legal Updates

Like numerous other development projects, the redevelopment of Chelsea FC hit a stumbling block as a result of rights of light enjoyed by some of its neighbours.  Chelsea FC nearly managed to overcome this issue by reaching agreement with most of those neighbours to pay compensation to them but, for the Crosthwaite family, a financial payment was not satisfactory.

Readers may recall hearing in the media about the Crosthwaite family who, concerned that the proposed £1bn expansion of the stadium to 60,000 seats would block light to their nearby home, took out an injunction against the redevelopment.

However, although the redevelopment of Chelsea FC was stalled by this, it was given the go-ahead, thanks to section 203 of the Housing and Planning Act 2016 and a court ruling last year.  Under this piece of legislation, authorities which are public bodies that acquire land are granted the power to override various easements/rights and restrictive covenants.  That means, amongst other things, that a local authority can carry out a development where planning permission has been granted, even if it interferes with rights of light.  One of the requirements for section 203 to apply is that the specified authority could acquire the land in question compulsorily for the relevant works, for the relevant use.  This is generally being interpreted as a requirement for there to be a public interest in the works.

In order to meet all the requirements of section 203, Chelsea FC granted a lease of the land to local authority, Hammersmith and Fulham Council, and then took a leaseback from them.  The Council, having acquired the land, was then able to use the powers granted to it by section 203 to override the rights of light affecting the land as the development was successfully argued to be in the public interest due to the benefits it brought to the community (including affordable housing and employment).

Where section 203 is used to bypass rights of light, instead of being granted an injunction or compensation in lieu of an injunction, the right holder will only be entitled to statutory compensation for injurious affection (in essence, the amount by which a property will depreciate as a result of the works).  In reality, a financial payment agreed with the developer or compensation ordered by the court in lieu of an injunction is likely to be much greater than the statutory compensation payable where the powers under section 203 have been used.  As it happens, in the Chelsea FC case, threatened with proceedings for judicial review, it is understood understand that Chelsea FC made an offer of compromise to the Crosthwaite family which was accepted (although whether the redevelopment at Stamford Bridge actually goes ahead remains to be seen).

Developers of the Walkie Talkie building in London also took advantage of the powers granted by section 203 in order to unlock the development by sidestepping rights of light affecting it, allowing it to proceed.  However, there are exceptions to the powers granted by section 203 – they do not authorise interference with “protected rights” (ie. a right vested in a statutory undertaker for the purpose of its undertaking or a right conferred by or in accordance with the electronic communications code) or rights annexed to National Trust land – and there will be many other developments where this piece of legislation will not come to the rescue.

In all circumstances where development is proposed, advice from a real estate solicitor and planning expert and, where appropriate, a rights of light specialist, should be sought at the earliest opportunity to see if there might be any legal obstacles to the development and to minimise potential disputes and litigation claims in the future.

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