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Cite as: [2008] EWCA Civ 859

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		Neutral Citation Number: [2008] EWCA Civ 859
		Case No: A3/2007/0383

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE CHANCERY DIVISION OF THE HIGH COURT
BIRMINGHAM DISTRICT REGISTRY
His Honour Judge Brown QC sitting as a High Court Judge
Claim No: 6BM30369

Royal Courts of Justice
Strand, London, WC2A 2LL

24/07/2008

B e f o r e :

THE CHANCELLOR OF THE HIGH COURT
(SIR ANDREW MORRITT)
LORD JUSTICE RIX
and
LORD JUSTICE RIMER
____________________

Between:

	BIRMINGHAM DEVELOPMENT COMPANY LIMITED	Appellant
	- and -
	MICHAEL JACOB TYLER	Respondent

____________________

Mr Ashley Underwood QC and Miss Katharine Holland (instructed by Eversheds LLP) for the Appellant
Miss Caroline Hutton (instructed by Shakespeare Putsman) for the Respondent
Hearing dates: 29 and 30 April 2008
____________________

HTML VERSION OF JUDGMENT
____________________

Lord Justice Rimer :

Introduction

This is an appeal by the claimant, Birmingham Development Company Limited ("BDC"), against the dismissal of its claim against the defendant, Michael Tyler, by an order dated 2 February 2007 made by His Honour Judge Brown QC sitting as a deputy judge of the Chancery Division. The claim was for an injunction restraining an alleged nuisance and for damages. So far as material for present purposes, BDC founded its claim on the alleged danger to the enjoyment of its property presented by two defects in a flank wall of Mr Tyler's neighbouring factory. In respect of one defect, the judge dismissed the claim on the basis that it presented no danger. In respect of the other, he dismissed the claim on the basis that the defect was latent so far as Mr Tyler was concerned and had been wholly caused by water flowing from a gutter on BDC's property.

BDC challenges his decision in relation to the first defect on the ground that it matters not that it presented no danger. It is enough that BDC, its advisers and Mr Tyler's advisers thought it did. It challenges the decision as to the second defect as being the result of a perverse finding of fact. It also complains that the judge failed to find that there was a third defect in the flank wall that presented a danger.

The background facts

BDC is a property developer. It owns land at 37-45 Commercial Street, Birmingham ("the site"). The buildings formerly on the site comprised a wharf and factory. BDC is in the process of developing the site as part of a development to be known as "The Cube". It commenced demolition works on the site on 7 June 2006. They were carried out by Coleman & Co ("Coleman"). BDC's intention was to start grubbing up foundations in October 2006 and to start piling works in November 2006.

At the material time, Mr Tyler owned land at 31 Commercial Street adjoining the site. His land was the site of a factory ("the factory") at which some 30 employees were engaged in manufacturing metal badges for various uses. The factory, built in the 1930s, was a three-storey building comprising workshops, offices and a basement. On 10 August 2006 Birmingham City Council served a compulsory purchase order on Mr Tyler with a view to the acquisition of his land so that BDC could demolish the factory and use the land as part of the Cube development. On 7 September 2006 Mr Tyler lodged objections to the CPO, his grounds being that his land was capable of independent development and that the City Council had made no attempt to buy his land by private treaty. Mr Tyler later (before judgment in the claim) withdrew those objections. BDC acquired the factory in May 2007 (which was after judgment). The factory has since been demolished.

By 24 June 2006 Coleman had started to demolish the gable wall of the building on the site. The work resulted in the increasing exposure of parts of the flank wall of the factory, which stood just 60mm back from (and in parts even closer to) the gable wall. That flank wall was a load bearing wall supporting the factory's suspended upper floors and roof. The demolition operations carried out on 7 July revealed an area of what appeared to be loosely-piled bricks on the flank wall. The judge described this as "a vertical section of brickwork 6 metres wide x 1 metre high at the top of Mr Tyler's flank wall that appeared haphazard, unbonded, loose and dislodged." This was referred to at the trial, and by the judge in his judgment, as "Area 1".

Mr Harle (of Harle & Co, engineers retained by Coleman) inspected Area 1 on the same day. He used the zoom lens on his camera to get a closer view. The result was that BDC and its advisers took the view that Area 1 presented an imminent danger to workers on the site. BDC's solicitors (Eversheds LLP) promptly wrote to Mr Tyler's solicitors (Shakespeares) about that concern and -- failing a satisfactory response by Mr Tyler by noon on 10 July as to the making good of the wall -- threatened him with an injunction requiring him to abate what was said to be a nuisance. Mr Hedley (of CB Richard Ellis Limited, Mr Tyler's party wall surveyor) attended the site. He regarded the brickwork as "untidy" but saw no signs of falling bricks. The demolition works on the site re-commenced on 8 July, although the work in the immediate area of Area 1 was done by hand rather than machinery so as avoid the risk of disturbing the Area 1 brickwork.

On 17 July 2006 Coleman's demolition operations revealed a further area of flank wall that BDC said also presented an apparent danger. The judge described this as "a bowed area, approximately 1.5 metres wide x 3 metres high at and above the first floor level, of bulging brickwork where the northern section appeared to have moved laterally by up to 50 mm relative to the southern section and vertical crack in it." This was referred to at the trial and by the judge in his judgment as "Area 2". On the same day, Mr Harle inspected Area 2 in the company of others including (i) Mr Edginton (BDC), (ii) Mr Brumpton (Buro Happold, BDC's consulting engineers), (iii) Mr Tyler, and (iv) Mr Mills (Faber Maunsell, consulting engineers assisting Mr Hedley). This time Mr Harle viewed the relevant area from a cherry picker. He also inspected the interior of the factory, which revealed no evidence of damage at the relevant area. On 19 July he prepared a report and said in it:

"There is some evidence that this occurred some time ago possibly when the wall was built as some of the bricks appear to have been cut to accommodate the movement. There is also evidence of water seepage which has removed the lime from the mortar between the bricks. Some movement has occurred at this location leading to cracking of some of the bricks. There is also one area nearer the front of the site where the wall of the adjacent building appears to consist of random bricks loosely laid with little or no mortar between them. An internal inspection of the boundary wall of the adjoining building revealed no cracks etc in the boundary wall."

The emergence of these apparent defects caused Coleman to view the flank wall as in such a bad condition as to present a real prospect that it would collapse on to their workers. On 20 July 2006 they advised BDC that it was in an "unsafe and potentially dangerous state" and that Mr Tyler's surveyors needed to complete remedial works "as a matter of urgency". Despite this expressed concern, demolition works, by machinery and by hand, nevertheless continued until 26 July, when the Phase 1 demolition contract was signed off as complete. A remaining part of BDC's gable wall was still to be demolished, but that task was agreed to be incorporated into Phase 2 of the demolition contract, that relating to the factory. In due course the contractors who were due to commence the grubbing up and piling works in the autumn were stood down. BDC was later to assert that the defects in the factory's flank wall caused a consequential delay to works on the site, which it said (but on which there has been no finding) cost it more than £45,000 a week.

BDC's project consultants (Faithful & Gould) agreed with Coleman's view as to the danger presented by the flank wall. Mr Harvey, their Senior Health & Safety Consultant, wrote that Mr Tyler should seek the immediate advice of a structural engineer or surveyor as to whether the factory was structurally sound and presented no risk to employees, the public or anyone on the site.

On 26 July Mr Mills (Faber Maunsell) produced a report for Mr Tyler, countersigned by his immediate superior, Mr Curtis. Mr Mills accepted that Areas 1 and 2 (and also Area 3, to which I come below) presented structural defects that "need to be addressed in the short term, particularly due to the ongoing demolition and construction works immediately adjacent." Area 1 was said to be an area of extremely poorly constructed brickwork resulting in the outer part of the external wall being constructed from loose laid bricks, with no bond between them and little or no mortar present. The report described the Area 2 bulge and its apparent cause. It made recommendations for dealing with the defects, those in relation to Area 1 being to remove the loose bricks and to inspect the construction and condition of the remaining wall. Mr Tyler did not disclose that report to BDC until the end of August 2006 and in the meantime denied that the wall posed any problem. Area 3 referred to by Mr Mills had become the subject of another point of concern: the gable wall at the front of the factory, overlooking Commercial Street, appeared to be leaning towards the street. Area 3 also became the subject of the proceedings, but I need not refer to it in detail as the appeal does not concern it.

On 3 August Buro Happold (BDC's structural engineers), having earlier inspected the flank wall, advised BDC that "clearly there is a concern regarding the safety of anyone who may be working in this area of wall. I would recommend that you request the owner of the [factory] ensures that his property is structurally sound."

On 8 August Taylor Woodrow (BDC's contractors) stated that the flank wall posed serious concerns with regard to their ability to work in a safe manner and environment in proximity to the factory. They said it "[p]resents major risks and hazards that are extremely difficult to evaluate and therefore subsequently mitigate and manage."

There was a joint site meeting on 18 August, one proposed by Mr Tyler. The engineers for both parties agreed the flank wall was dangerous. The meeting note recorded that all parties thought an inspection of it was unnecessary. Mr Mills confirmed that he agreed with Buro Happold's concerns about the safety of the wall and made proposals as to the remedial work that needed to be done.

Despite all this, Mr Tyler's stance, as explained by Shakespeares' letter of 29 August to Eversheds, was that (i) the wall was not dangerous and did not constitute a nuisance; no bricks had fallen from Area 1, despite Coleman's demolition methods (which included the use of heavy lorries and machinery); (ii) it was only BDC's extraordinary use of the site that caused a potential risk; (iii) BDC was itself responsible for creating any danger presented by Area 2; and (iv) Mr Tyler was content to permit BDC to carry out repair works at its expense. Eversheds provided a response on 31 August. They referred to the Faber Maunsell report to the effect that the defects in the wall needed to be addressed in the short term, challenged the suggestion that the demolition works on the site were an extraordinary use of the site and said the only issue was who was responsible for remedying the Area 2 defects. They made an offer that BDC would carry out the necessary works on terms that Mr Tyler would bear the costs of repairing Area 1 and that the incidence of the costs of repairing Area 2 would abide the resolution of liability for those works, but subject to Mr Tyler providing adequate security for recovery by BDC of its expenditure. Failing acceptance of the offer, BDC would issue proceedings against Mr Tyler and seek an interim injunction requiring the execution by him of remedial works. Shakespeares replied on 6 September that Mr Tyler had made no admission as to his liability to repair Area 1. They made a counter-proposal as to the repair of Area 1, involving a splitting of the overall costs between Mr Tyler and BDC, and denied any liability to repair Area 2.

The proceedings

The parties did not reach agreement and so on 11 September 2006 BDC issued its threatened proceedings against Mr Tyler. The relief sought was based in nuisance and negligence and was for mandatory injunctive relief and damages. No physical damage to the site had occurred. The case was that the flank wall presented a substantial risk of brickwork falling on to the site and asserted that BDC had had to suspend its demolition work resulting in disruption to the development programme. The judge found that in fact demolition work, with machinery and by hand, continued until 26 July, when the Phase 1 demolition contract was signed off as complete.

The precise nature of BDC's pleaded case is relevant to the appeal and I will set out paragraphs 3 and 4 of the Particulars of Claim:

"3. The Site

3.1 [BDC] is proposing to undertake works on the Site and on other neighbouring areas of land within its ownership for the purpose of developing the final phase of the development known as 'The Mailbox', which is to be known as 'The Cube'.

3.2 There is a wall on the flank wall of the building situated on [Mr Tyler's] Land which is in a dangerous condition and represents a serious risk of imminent danger to persons and/or property on the Site in that:-

3.2.1 A vertical section of brickwork at the top of the wall, as shown edged red on the Plan, is unbonded and a number of bricks have become dislodged;

3.2.2 There is a bowed area of bulging brickwork in the area shown edged blue on the Plan.

3.3 The gable wall of the building situated on [Mr Tyler's] Land (as shown edged green on the Plan) is also in a dangerous condition and presents a serious risk of imminent danger to persons and/or property on the Site in that:-

3.3.1 The ends of the wall are not properly bonded in to the flank walls;

3.3.2 The wall has moved forward in position."

4. Nuisance/Breach of Duty of Care

4.1 The condition of the said walls constitutes a nuisance and [BDC's] use and enjoyment of the Site has thereby been interfered with in that: -

4.1.1 No-one can safely enter upon or use any part of the Site which falls within a distance of approximately 20 metres from the flank wall; and/or

4.1.2 [BDC] is unable to undertake any works on this part of the Site or on any other part of the Site, given that the integrity of [the] flank wall is so delicate and precarious that even minor works on any part of the Site would be likely to result in the collapse of the wall; and/or

4.1.3 [BDC's] demolition contractors, project consultants and developers have all refused to enter upon the Site whilst the walls continue to be in this dangerous condition; and/or

4.2 Further and/or alternatively, there is a serious risk that part or all of the walls will collapse on to the Site, thereby causing a further nuisance.

4.3 Further and/or alternatively, by reason of the matters set out in Paragraphs 4.1 and/or 4.2 above, [Mr Tyler] is in breach of the duty/duties of care which he owes to [BDC], namely not to do or neglect to do or suffer anything on his land which: -

4.3.1 will interfere with the Defendant's [sic: means "Claimant's] reasonable enjoyment and use of the Land [sic: means "the Site"] and/or;

4.3.2 presents a serious risk to the safety [of] persons on the Site; and/or

4.3.3 presents a serious risk of injury to property on the Site."

The section of wall referred to in paragraph 3.2.1 is Area 1. The section referred to in paragraph 3.2.2 is Area 2. Paragraph 3.3 refers to Area 3.

BDC's interim application for a mandatory injunction

On 19 September Judge Brown (then a Recorder) heard BDC's application for a quia timet interim mandatory injunction ordering Mr Tyler to prevent the flank wall (Areas 1 and 2) and the south eastern gable wall (Area 3) from remaining in such a condition as to present an imminent risk of danger to persons and property on the site. The evidence consisted of witness statements from Mr Edginton and Mr Tyler. Following a contested hearing, Judge Brown made the order sought, being satisfied that each of Areas 1, 2 and 3 did indeed "look" dangerous. Mr Tyler sought permission to appeal but it was refused. The order required remedial work to be carried out to (i) "the loose brickwork" (plainly a reference to Area 1 pleaded in paragraph 3.2.1 of the Particulars of Claim) and (ii) "the bulging brickwork" (plainly a reference to Area 2 pleaded in paragraph 3.2.2). It may perhaps be that the obtaining of that order was assisted by Mr Edginton's misleading evidence that the demolition work on the site had stopped on 20 July following the revelation of the Area 2 defect on 17 July. It did not in fact stop then but continued until it was signed off on 26 July. That error in Mr Edginton's evidence was later shown by BDC's disclosure of day sheets, and he admitted he was wrong in what he had said.

Following that order, Mr Tyler instructed Nicholas Hirschman of Brock Consulting Engineers to produce a temporary remedial scheme to satisfy the injunction. Mr Read, of P.J. Read Building Services Limited, specialists in this type of work, was instructed to carry it out. He is a chartered civil engineer with considerable experience in the field of structural repairs to buildings. He did the work between 28 and 30 September 2006. It included the wire meshing of Area 1 and the meshing and tying of Area 2.

The trial

The trial, concerned solely with liability, was expedited and commenced on 22 November 2006. Miss Holland appeared for BDC and Miss Hutton for Mr Tyler. After two days, the trial was adjourned part heard, and resumed on 6 and 8 December. It was then adjourned to 8 January 2007, when it continued over 9, 11 and 12 January, when it concluded. Miss Holland was unable to appear on the adjourned hearing in January and Mr Underwood was briefed in her place, having to read himself in from the transcripts. The judge's reserved judgment was delivered on 2 February 2007.

It was agreed at the trial that Area 1 had not posed any danger since the completion of the works on 30 September, although there was an issue as to whether Area 1 had posed any danger until then: BDC's case was that it had and Mr Tyler's was that it had not. It was also agreed at the trial that Area 2 was dangerous until the remedial works were carried out on 30 September. There was a dispute as to (i) whether Area 2 was still dangerous; and (ii) as to the cause of the defect in Area 2. My Tyler's case was that the Area 2 defect had been caused by a defective gutter on the site. BDC disputed that.

In relation to point (i), the judge referred to a fourth area, which he called Area 4. That is not a label to which Mr Underwood was or is prepared to subscribe, since his case is that what the judge called Area 4 was really part of Area 2. Without pre-judging the correctness of that assertion, I shall, like the judge, also refer to this area as "Area 4". Investigations had revealed that Area 4, being an area of wall that the judge described in paragraph 20 as "beyond and around Area 2", consisted of single skin brickwork which had been investigated in part. He said that Area 4 had not been "separately [labelled] in the pleaded issues." He said in paragraph 21:

"21 … [BDC] contend that Area 2 is still dangerous because of the single untied skin of tall brickwork that they claim is likely to be a wholesale design feature of the rest of the unexposed wall from their sampling of it by Buro Happold. [Mr Tyler contends] that Area 2 has been repaired and that the areas of untied brickwork in Area 4 are no part of the pleaded claim, and may just be localized features of the wall rather [than] a wholesale design feature because the areas exposed do show features filled with different brickwork. [He contends] that it would be wrong to speculate at this stage."

I should explain that "the unexposed wall" to which the judge there referred was unexposed because the demolition of BDC's gable wall had stopped and no investigation of the part of the flank wall standing behind the undemolished part had been or could have been made.

As to point (ii) above, namely the cause of the defect in Area 2, there was considerable investigation into this, including two site views, on one of which the judge climbed a ladder in order to carry out his own close inspection. On 28 December 2006 (during the adjournment of the trial) Mr Brumpton (for BDC) carried out some intrusive testing of the repair works. That revealed that the cause of the bulge at Area 2 was the rusting end of a steel joist supporting the first floor of the factory and both sides agreed that the immediate physical cause of the defect in Area 2 – the cracking and bowing – was lateral movement caused by the rusted end of that beam embedded into the wall.

A further issue, however, was as to the effective cause of the water damage that rusted the end of that beam behind the Area 2 bulge. BDC's case was that it was caused by rainwater passing through holes in the bitumen flat roof of the factory directly above. Mr Tyler's case was that no such water had seeped down that far from the roof and that the cause of the water damage was a broken, blocked valley gutter serving BDC's building. It was agreed that Mr Tyler raised a complaint about this in about 1999/2000; and Mr Billingham of BDC accepted that at about then he had authorised remedial action that re-routed the down pipe across BDC's buildings and so solved the problem, provided that the gutter was regularly kept clear, which Mr Tyler said he did, even though it was not his responsibility to do so.

The judge made findings on all these issues, dealing first with the extent to which, at the time of the issue of the proceedings, Areas 1 and 2 presented actual or perceived danger to BDC. His findings were as follows.

Area 1

The judge said the best evidence as to this was from Mr Read. He was the first person, with Mr Hirschman, to examine Area 1 close up and manually: previously all experts had looked at Area 1 remotely through camera zoom lenses, binoculars or from a cherry picker. There was no doubt that the Area 1 brickwork looked dreadful – it lacked mortaring and appeared random/haphazard -- and appeared dangerous. Thus BDC had proved that it had a subjective concern that Area 1 presented a real danger. The judge was baffled as to why none of BDC's experts, nor BDC itself, had made a close examination of Area 1 (or of the other areas) before seeking injunctive relief against Mr Tyler and seeking an order against him requiring him to spend money on a factory that in due course BDC wanted to demolish as part of the Cube development works.

Mr Read's evidence as a result of his close, hands-on investigation was that there was no danger of bricks falling or of the wall collapsing at this point. The remedial works he carried out were therefore a "belt and braces" exercise to give comfort to all concerned and to enable Mr Tyler to show he had satisfied the injunction. The judge accepted Mr Read's evidence and found that Area 1 was "objectively at all material times not dangerous, i.e. safe".

Area 2

The judge found that Area 2:

"38 … was undoubtedly still a potential danger despite the remedial works undertaken by Mr Read. This is because there is a section of untied brickwork beyond in Area 4. Mr Curtis, the Defendant's expert did not demur from this in cross examination. He could not say that the wall was definitely stable because of the twin features of evidence of lack of ties and the crack/bulge at Area 2. Confirmation of this, if needed, can be gained from the fact that the actual demolition works have stopped at this point and the wall is currently propped."

Area 3

The judge found there was never any danger emanating from Area 3 potentially affecting the BDC site.

Causation

The judge then turned to the cause of the defect in Area 2. He quoted the passage from Mr Harle's report that I have quoted. He said it showed that (i) bricks had been intentionally cut, and (ii) water seepage had been considerable and over a long period of time. He found that the evidence from both sides supported point (i). As to point (ii), he found that the relevant water damage had been substantially caused by BDC's defective gutter pipe over a number of years prior to 1999/2000, that this was a latent defect as far as Mr Tyler was concerned and that the damage was not even contributed to by water leaking through the factory roof. Since his findings in these respects are challenged, I will set them out:

"42. On the second point, the location and nature of the defect of the completely rotted wood indicates that a very considerable amount of water must have deluged down into this area over a long period of time, most probably long ago. There is no doubt from the photographs that the down pipe of BDC's building must have been leaking for a number of years before Mr Billingham had it repaired and diverted in 1999/2000. The pattern of flask shaped damp to the wall itself and to BDC's building correspondingly opposite seen internally strongly supports this. Moreover, the pitched roof beside the rain [sic] above obviously sent a lot of water into the gutter being served to the extent that Mr Tyler had to come up at intervals to unblock the drain when a deep pool of water collected there causing damp to his own building at a higher level than Area 2. I am satisfied that [Mr Tyler] has proved that the water damage of the rotted wood and the rusted steel beam end has been substantially caused by BDC's defective gutter pipe over a number of years prior to 1999/2000 and that this was a latent defect so far as Mr Tyler was concerned. Obviously, it was not so far as BDC were concerned or else Mr Billingham would not have gone to the time and trouble to have the defect remedied. To put it neutrally, it is very surprising that he did not raise this or produce photograph of this until very late on in the trial when he knew it was a very important and time consuming issue placed before the court and that the defence hinged substantially on this.

43. However, [BDC] contend that, even so, water leaking through Mr Tyler's roof, if not the primary cause of the rusted beam end, made a 'material contribution' to that causative damage (see Loftus-Brigham v. London Borough of Ealing [2003] EWCA Civ 1490). On 31^st May 2006, David Dunger FRICS of Green & Co inspected Mr Tyler's factory and took photographs for the purposes of a Report on the Overt Condition of it that he submitted to Mr Tyler on 7^th June 2006. He gave evidence before me. He was a most impressive witness, indeed a model witness. He has 30 years of experience [as] a building surveyor of buildings like this. His report was a 'General' Report on the Whole Condition of Mr Tyler's factory and he recorded no significant defects to Mr Tyler's roof at the point above the offending rusted steel beam. I do not believe he would have missed anything of great significance such as a significant hole [in] the roof that would have caused a substantial piece of wood a floor level down to rot over a long period. Indeed, whilst it is true that there are patches of damp on Mr Tyler's walls in this area and photographs do show some small holes in the roof that may be causing that damp, I do not believe that they have anything to do with the rotted piece of timber and the rusted end beam. A substantial amount of water over a long period of time caused the rotted timber and the rust, not a slight roof leak well above. There is no evidence that Mr Tyler has been flooded out by roof leak in his old but neat working factory and the tracking paths of water that might be identified by any roof leaks stop short of the rotted timber and the rusted beam end. I am satisfied that Mr Tyler has proved that the defect that caused the bulge and crack in Area 2 was not caused by him and was wholly caused by BDC's leaking gutter.

Area 4

Having made those findings, the judge then said this, which I also quote as relevant to one of BDC's grounds of appeal:

"Area 4

44. In his final submissions, Mr Underwood QC took a slightly different tack for [BDC] that had hitherto been adopted by [BDC]. Beguilingly, he submitted that the remedial works to Area 2 had moved the problem from there (i.e. assuming Area 2 was now cured and freestanding of Area 4) into the Area called Area 4 where Mr Brumpton had discovered that substantial areas of the wall were single skin presenting a design danger when the demolition works move to that area. I think it would be wrong in principle to speculate on this relatively unexplored area. He and Mr Brumpton might be right but if so, and then that is a matter that has to be pleaded and then evidentially investigated by engineers and also building surveyors such as Mr Dunger before being put before the Court. Without undergoing that process the Court would have to indulge in educated guess work. The Court is currently in no position to undertake that process. Hopefully, the Court will not be required upon that task: it is greatly to be hoped that an amicable solution between neighbours perhaps using mediation or by CPO so as to avert any possible further unpleasant and costly neighbour dispute."

The principles of law that the judge applied to the facts he found

The judge reviewed the law relating to the tort upon which BDC sued. He identified the following principles. First, BDC had to establish "danger" emanating from Mr Tyler's factory in the three areas, and he said counsel had agreed that this meant a "serious risk of imminent harm i.e. a serious risk that physical injury or damage will occur in the immediate future." Second, BDC needed to establish that the danger induced in it a "well founded apprehension of real, or actual and real danger", that is an objective and subjective fear of such danger. Third, an occupier of land must not unreasonably permit a state of affairs to exist on his land which interferes with the reasonable enjoyment of the land of another. Fourth, it matters not that the landowner upon whom the duty is cast did not create the state of affairs, which may have arisen through design. In the case of a latent defect, the duty arises when he becomes aware of it. Fifth, the duty arises in both negligence and nuisance. Sixth, the scope of the duty is to do that which is reasonable in the circumstances. Seventh, the use to which the claimant is putting his own land, or wishes to put it, is immaterial provided it is lawful. Eighth, the categories of states of affairs which give rise to the duty are not closed. Ninth, a dangerous state of affairs that gives rise to a reasonably held fear in connection with the use of land may amount to a nuisance or a breach of the duty of care. Tenth, actual physical damage or encroachment does need to be proved in Types 1 and 2 nuisance cases, but not in Type 3 cases, which was the present one. In a Type 3 case, it must be established that the "fear" of collapse of a wall or brickwork interferes with physical enjoyment of the land threatened (see Clerk & Lindsell on Torts, 19^th Edition, paragraph 20-06, for the three types to which the judge was referring). Eleventh, it is a defence to a claim in nuisance for the defendant to prove that the danger was caused by the claimant and there was no material contribution to such danger by the defendant.

The judge's decision

Applying those principles to the facts found, the judge's decision was that Mr Tyler succeeded on liability in relation to each of Areas 1, 2 and 3. He discharged the injunction of 19 September 2006 and dismissed BDC's claim. As to Area 1, BDC had proved its subjective fear of the danger that Area 1 was perceived as presenting, but as Area 1 did not in fact present any danger, that subjective fear was of a non-existent danger and so an essential ingredient of the alleged tort was missing. As to Area 2, it did present a danger, but the danger had been caused by BDC and Mr Tyler made no material contribution to it. The Area 3 claim failed because Area 3 never presented an actual danger.

The grounds of appeal

By its grounds of appeal, BDC challenged the judge's decision on four grounds: (1) he was wrong to hold that a claimant must prove an actual danger before being able to establish nuisance or a breach of duty; (2) he anyway misdirected himself as to the evidence of actual danger in Area 1 and reached a perverse conclusion that it did not present such a danger; (3) he failed to deal with the issue of the defect to the left of the Area 2 crack (what the judge called Area 4), misdirected himself that Area 4 was not pleaded, failed to heed the agreed expert evidence that it was unstable and perversely failed to find that it constituted a nuisance or breach of a duty of care; and (4) misdirected himself as to the evidence about the cause of the defect in Area 2 and reached a perverse conclusion. Permission to appeal on grounds (1) and (3) was granted on paper by Richards LJ. The permission application on grounds (2) and (4) was renewed before us on the basis that, if permission were given, the appeal on those grounds would follow immediately.

Ground 2

I deal with this first since, if it were made good, the premise on which ground 1 is advanced (no actual danger presented by Area 1) would not arise. I can deal with it shortly. This ground of appeal, for which Mr Underwood renewed BDC's application for permission, was directed at making good the assertion that the judge misdirected himself as to the evidence of actual danger in Area 1 and ought to have found that it did present a danger. Mr Underwood developed the argument fully, but after hearing Miss Hutton's succinct response he gracefully abandoned it. If I may say so, he showed good judgment in doing so. I say no more about Ground 2 save only, if it is formally necessary, that I would refuse permission to appeal on this ground.

Ground 1

BDC's claim against Mr Tyler was based on the tort of private nuisance and negligence. No case was made that anything Mr Tyler had done had caused an encroachment on to the site or had caused physical damage to it. The case was based on a so-called type 3 nuisance, namely that Mr Tyler's conduct amounted to an unreasonable, and so tortious, interference with BDC's comfortable and convenient enjoyment of the site (see again Clerk & Lindsell, supra, at paragraph 20-06). The case was that BDC and its advisers reasonably perceived Area 1 to present a risk of danger to the safe occupation and enjoyment of the site, and that perception led to the stopping of work on the site and so interrupted that safe occupation and enjoyment.

The Area 1 case failed because BDC failed to prove that the factory presented any actual danger to the site or to its enjoyment of it. Although the judge accepted that BDC had proved a subjective fear of danger in relation to Area 1, he held that by itself this was insufficient to establish a nuisance against Mr Tyler. BDC's submission to us was that the correct legal position is (a) that the categories of case in which a duty can arise in nuisance or negligence as between neighbours are not closed; (b) that Mr Tyler was under a duty not unreasonably to permit a state of affairs to exist on his land which interfered with the reasonable enjoyment by BDC of the site, and that duty arose both in nuisance and negligence; and (c) it was not necessary for BDC to prove an actual danger emanating from Mr Tyler's land causing such interference. All that it was necessary for BDC to show, as it did, was that it had a reasonable apprehension of danger which interfered with its use of the site. The relevant time at which the matter had to be judged was immediately before the issue of proceedings on 11 September 2006. The position at that date was that BDC, supported by its expert advisers, was of the view that Area 1 represented a risk of danger to the occupation of the site; and Mr Tyler's own advisers shared that view. It was therefore reasonable for BDC to stop work on that part of the site that was at risk; and reasonable also for Mr Tyler, as BDC's neighbour, to take reasonable steps to remove the risk of danger by ensuring the integrity of Area 1.There was no suggestion that the works required to do so would be unreasonably expensive. The remedial works carried out in compliance with the interim mandatory injunction cost no more than about £5,000. It followed that, judging the matter as at 11 September 2006, the cause of action in nuisance was established and the claim should have been upheld.

I would not disagree with Mr Underwood's proposition (a). As to his proposition (b), that is also correct as a general proposition but the critical question is whether Mr Tyler breached that duty. The submission central to this ground of appeal is proposition (c).

Mr Underwood sought to make that good by reference to a line of authorities in the field of nuisance showing that whether in any particular case a liability in nuisance as between neighbours can be made good will depend upon the reasonableness of the conduct of the alleged tortfeasor, including his conduct in omitting or failing to remedy or minimise any risk that may exist. He referred us first to Sedleigh-Denfield v. O'Callaghan and Others [1940] AC 880, where Lord Wright summarised the essence of the principle, saying at 903:

"A balance has to be maintained between the right of the occupier to do what he likes with his own, and the right of his neighbour not to be interfered with. It is impossible to give any precise or universal formula, but it may broadly be said that a useful test is perhaps what is reasonable according to the ordinary usages of mankind living in society, or more correctly in a particular society."

Mr Underwood referred further to Overseas Tankship (UK) Ltd v. The Miller Steamship Co Pty and Another [1967] AC 617, at 639, 643 and 643; Goldman v. Hargrave [1967] AC 645, at 661 to 663; and Delaware Mansions Ltd. v Westminster City Council [2002] 1 AC 321. To illustrate his submission more fully, I regard it as sufficient to cite from the judgment of Megaw LJ in Leakey and Others v. National Trust for Places of Historic Interest or Natural Beauty [1980] 1 QB 485. In explaining the nature of the duty owed by a landowner to his neighbour, Megaw LJ said, at 524E:

"The duty is a duty to do that which is reasonable in all the circumstances, and no more than what, if anything, is reasonable to prevent or minimise the known risk of damage or injury to one's neighbour or his property. The considerations with which the law is familiar are all to be taken into account in deciding whether there has been a breach of duty, and, if so, what that breach is, and whether it is causative of the damage in respect of which the claim is made. Thus, there will fall to be considered the extent of the risk; what, so far as reasonably can be foreseen, are the chances that anything untoward will happen or that any damage will be caused? What is to be foreseen as to the possible extent of the damage if the risk becomes a reality? Is it practicable to prevent, or to minimise, the happening of any damage? If it is practicable, how simple or how difficult are the measures which could be taken, how much and how lengthy work do they involve, and what is the probable cost of such works? Was there sufficient time for preventive action to have been taken, by persons acting reasonably in relation to the known risk between the time when it became known to, or should have been realised by, the defendant, and the time when the damage occurred? Factors such as these, so far as they apply in a particular case, fall to be weighed in deciding whether the defendant's duty of care requires, or required, him to do anything and, if so, what."

BDC's case is therefore simple. BDC and its experts were of the opinion that Area 1 was dangerous. Mr Tyler's experts were of a like view. Mr Tyler ought therefore reasonably to have taken reasonable steps to ensure that the danger and the risk it presented was abated. He should have taken this step when asked to do so in August 2006. He failed to do so. It mattered not that he denied that Area 1 presented a danger for which he was liable. His failure to remedy the perceived danger was unreasonable. There is no suggestion that he could not afford to pay the relatively modest expense the work would cost. His failure had caused BDC to stop work on the site. The claim that BDC brought against Mr Tyler in nuisance was therefore well founded, the cause of action in nuisance in relation to Area 1 was fully constituted by 11 September 2006 and the judge was wrong to dismiss it on the basis that Area 1 never presented any danger at all.

Before considering Miss Hutton's response, it is worth noting that BDC's case so advanced bears no relation to its pleaded case. Paragraph 3 of the Particulars of Claim alleged that Area 1 was dangerous and presented a risk; and paragraph 4 pleaded that in consequence no-one could safely enter upon part of the site which was exposed to that danger. Success on that case required proof that Area 1 was actually dangerous and presented a risk, a fact that BDC failed to prove. There was no alternative plea that, if that case was wrong, BDC (i) reasonably believed that Area 1 was dangerous, whether or not it was in fact; (ii) that Mr Tyler's experts were of a like view; and (iii) that therefore Mr Tyler ought reasonably to have taken steps to abate the basis on which BDC's belief was founded.

Strictly, therefore, the case now made is not open to BDC on its pleadings. But Mr Underwood, in his closing submissions before the judge, argued the like point, no doubt prompted by his well-founded subjective perception that the pleaded ship was in actual danger of sinking. The judge did not refer expressly to the submission in his judgment, but he implicitly rejected it on the basis of his view that in a case of type 3 private nuisance nothing less will do than proof of an actual danger on the defendant's land, involving a serious risk that physical injury or damage will occur in the immediate future. His adoption of that view was not surprising. That was how the law had been put before him on an agreed basis by counsel before Mr Underwood made his closing submissions.

Miss Hutton's submission was short and straightforward. Accepting for the purposes of argument that BDC had an honest and reasonable fear that Mr Tyler's wall presented a danger to the site and to BDC's enjoyment of it, that was insufficient by itself to found a cause of action in nuisance against Mr Tyler. That is because nothing less than proof of a serious risk of imminent physical injury or harm was required. None of the cases on which Mr Underwood relied provided any help to the present issue. They were all cases where damage had actually happened and so had shown that a danger had actually existed. The present case was different. At the date of the issue of the proceedings no damage had been suffered other than the damage said to have resulted from BDC's reaction to its own fear; but that was not damage flowing from the risk of imminent injury from the factory wall because there was none. The case could not succeed unless BDC proved that its admitted fear of danger was real – meaning well-founded -- which required it to prove on the balance of probabilities that the wall actually presented a danger. That was how the case had been opened to the judge by Miss Holland for BDC.

Miss Hutton referred us to the public nuisance case of Regina v. Lister and Another Dears & Bell 209; 169 English Reports, p. 979. In that case the defendants were indicted with knowingly depositing in their warehouse, which was close to public streets, excessive quantities of dangerous ignitable and explosive fluid called wood naptha. The assertion was that, as a result, the neighbouring and passing public was in great danger of their lives and property and kept in great alarm and terror: if there were to be a fire in the warehouse, it could not be quenched and would produce disastrous consequences in the neighbourhood. The defendants were convicted and a court of 11 judges on appeal upheld the indictment as disclosing an offence and that the facts alleged, taken together, justified the guilty verdict. It was argued on behalf of the defendants that naptha was not self-inflammatory, that it was maintained with care, that it was not therefore dangerous and that the alarm of the public was not of itself sufficient to prove an indictable offence in nuisance. Reliance was placed on a statement of Lord Hardwick in Anon, 3 Atkyns, 750, to the effect that the fears of mankind, though they might be reasonable ones, would not create a nuisance, and he refused an injunction. The point being made was that the naptha in the warehouse did not represent an actual danger to the public.

That submission failed on the facts found by the jury. Lord Campbell CJ, giving the judgment of the court, said at 227:

"The law of this country would surely be very defective if life and property could be so exposed to danger by the act of another with impunity. There is no ground for saying that, according to the doctrine contended for by the prosecutor's counsel, neither brandy nor wine, nor oil, nor any ignitable substance, could be kept in the cellar of a town house without the owner of the house being liable to imprisonment. The substance must be of such a nature and kept in such large quantities, and under such local circumstances, as to create real danger to life and property. The well founded apprehension of danger which would alarm men of steady nerves and reasonable courage, passing through the street in which the house stands, or residing in adjoining houses, is enough to show that something has been done which the law ought to prevent by pronouncing it to be a misdemeanour. Accordingly, to manufacture, or to keep in large quantities, in towns or closely inhabited places, gunpowder (which for this purpose cannot be distinguished from naptha) is by the common law of England a nuisance and an indictable offence. … it is a question of fact for the jury whether the keeping and depositing, or the manufacturing of such substances, really does create danger to life and property as alleged – and this must be a question of degree, depending on the circumstances of each particular case. No general rule of law can be laid down beyond this, that the substantial allegations in the indictment must be substantially proved. In the present case we think that sufficient, although not necessarily conclusive, evidence was adduced, and that although the Judge would not have been justified in directing a verdict of guilty to be entered without taking the opinion of the jury upon it, he was fully justified in telling the jury (which he appears to have done) that if the depositing and keeping the naptha in the manner described, coupled with its liability to ignition ab extra, created danger to life and property to the degree alleged, they might find a verdict of guilty. Whether the liability to ignition ab extra could properly be taken into consideration by the jury, he reserved for our opinion, and we answer – Yes. The conviction must therefore be affirmed."

Miss Hutton submitted that this case showed that it was necessary, in order to make good the nuisance indictment, to allege and prove actual danger. She also said, and I agree, that it was implicit in the reference in that passage to "the well-founded apprehension of danger which would alarm men of steady nerves and reasonable courage" that the men referred to were aware of the fact of the danger. The essence of the case was that actual danger had to be proved. If the fears were of a non-existent danger, no complaint of nuisance could have been sustained.

To the like effect, submitted Miss Hutton, was Attorney-General v. Corporation of Nottingham [1904] 1 Ch 673. That claim was brought by the Attorney-General on the relation of local inhabitants who feared that the devotion of a building as a smallpox hospital presented a serious danger to them. No actual injury had been suffered and the action was brought quia timet. Farwell J said, at 677:

"In order to succeed in such an action the plaintiffs must shew a strong case of probability that the apprehended mischief will in fact arise: Attorney-General v. Manchester Corporation [1893] 2 Ch 87; or, to quote Fitzgibbon LJ in Attorney-General v. Rathmines and Pembroke Joint Hospital Board [1904] 1 I.R. 161, 'to sustain the injunction the law requires proof by the plaintiffs of a well-founded apprehension of injury – proof of actual and real danger – a strong probability almost amounting to moral certainty that if the hospital be established it will be an actionable nuisance. A sentiment of danger and dislike, however natural and justified, certainty that the hospital will be disagreeable or inconvenient, proof that it will abridge a man's pleasure or make him anxious, the inability of the Court to say that no danger will arise, none of these accompanied by depreciation of property will discharge the burden of proof which rests on the plaintiffs, or justify a merely precautionary injunction restraining an owner's use of his own land upon the ground of apprehended nuisance to his neighbours."

Having so stated the principle, Farwell J dismissed the action, the Attorney-General having failed to prove the claim. That statement was said by Miss Hutton to be in line with the principle to be derived from Lister. Honest, perhaps reasonable, fear of danger is not enough. What is required before a nuisance can be proved is a well-founded fear, which means proving on the probabilities the reality of the danger that has given rise to the fear. None of the cases on which Mr Underwood relied had changed that principle. In all those cases damage had happened and so proved the existence of the prior danger. The questions they raised included why the damage had happened, whether it was foreseeable and whether it would have been reasonable for the defendants to have done something to prevent it and, if so, what.

In my judgment Miss Hutton's submission is to be preferred and I accept it. I consider that the judge was right to dismiss the Area 1 claim for the reasons he gave. The law of private nuisance is concerned with the circumstances in which the occupier of land is entitled to a remedy in consequence of the unreasonable disturbance of his enjoyment of it by the acts or omissions of others. Those others will commonly be neighbours. A claim in nuisance will generally depend on proof of something emanating from his neighbour's land, which may take many forms, for example noise, dirt, fumes, smell, vibrations; or it may depend on the mere fact that the activities conducted on the neighbouring land are offensive: see Hunter and Others v. Canary Wharf Ltd [1997] AC 655, at 685G, per Lord Goff of Chieveley.

In addition, there is in my judgment no doubt that, whilst the existence on the neighbouring property of what the old reports used to refer to as a tumbledown house may not in itself be tortious, a claimant will or may have a complaint in nuisance if that house borders his own property and its state of dilapidation is such that it presents a real danger of collapsing on to his property. For the claimant to live in the shadow of such a danger will obviously be to interfere with his enjoyment of his property. It may prevent him from using part of it for fear of what will happen if there is a collapse. It may require him to vacate it altogether. In such a case the claimant may well, subject to all the issues of reasonableness discussed in the authorities, have a claim in nuisance against the neighbour requiring him to make his house safe from the risk of collapse onto his property.

The present case, as regards Area 1, pretends to be a case of that sort. It is said that BDC, supported by its expert advisers, had an honest and reasonable fear that Area 1 in the factory's flank wall presented a danger to the safety of the site; that in consequence of that fear BDC had to cease use of part of the site and so suffered damage; and that Mr Tyler failed unreasonably to remove BDC's concerns by carrying out necessary repairs to Area 1 so as to make it safe.

I do not question that when BDC commenced its action on 11 September 2006 it had a genuine, subjective fear that Area 1 was dangerous and that prior to then Mr Tyler had not taken steps to remove that fear. But as, so the judge found, Area 1 in fact never presented any actual danger at all, so that BDC's honest fears were unfounded, the proposition that BDC nevertheless had a claim in private nuisance against Mr Tyler appears to me to be surprising. Mr Tyler had neither done, nor suffered, anything in relation to Area 1 that created any danger to BDC's enjoyment of the site. The notion that he should nevertheless be answerable for the claimed consequences of BDC's concern – and should be required to carry out, at his expense, unnecessary works to make safe that which was already safe – is one I do not begin to comprehend. The hard truth of this case is that BDC's concern was not caused by any act or omission by Mr Tyler, or by any danger presented by Area 1. It was caused by the jumping to wrong conclusions by BDC and the experts, not one of whom carried out a professional examination of the supposed problem. The judge was baffled as to why no one (until Mr Read) embarked upon a hands-on investigation of the problem and so am I. But the end result is that Mr Tyler is being asked to make amends to BDC for its mistaken diagnosis of a danger that never was.

In my view it is plain that BDC has no cause of action against Mr Tyler in nuisance in respect of Area 1. The Lister and Attorney-General v. Nottingham Corporation cases show that it is not enough for a claimant who asserts that his neighbour's property or activities are dangerous merely to prove that he is frightened by them. What is required is proof that the fear is well-founded: that is, that the property or activities are actually dangerous, although it is not necessary to do more than prove that on the balance of probabilities. That proposition will come as no surprise to BDC because that is the case they sought to make. That case having failed, Mr Underwood has, with beguiling charm, sought to persuade us that it is enough for the claimant to say "timeo", even though an examination of the problem said to justify the fear shows the fear to have been unfounded. I do not accept that that is the law, and I regard it as contrary to the authorities. In my judgment, the judge's decision in relation to Area 1 was correct. I would dismiss ground 1 of the appeal.

Ground 3

The dispute over Area 2 is said by Mr Underwood to have raised two issues. First, whether Area 2 was limited to the bulge caused by the rusting steel beam. Second, whether the source of the water that rusted the beam was the leaking valley gutter and drainpipe on the site. The judge found for Mr Tyler on both issues. Ground 3 relates to the first point.

Mr Underwood submitted initially that BDC's pleaded case was advanced on two alternative bases. The first, in paragraph 3, was that each of Areas 1 and 2 was dangerous. I agree. The second, in paragraph 4.2, was that there was a serious risk that part or all of the flank wall would collapse on to BDC's site. I agree that is what paragraph 4.2 says, but disagree with Mr Underwood's initial suggestion that it opened up a wider case as to the integrity of the brickwork in areas of the wall other than those pleaded in paragraph 3. All paragraph 4 was doing was to plead the nature of the nuisance that the paragraph 3.2 defects were said to present. I understood Mr Underwood to be disposed to accept that. But it nonetheless remained a major part of his submission that BDC's pleaded case raised an issue not just as to the integrity of the narrow area of the bulge and crack referred to by the judge as Area 2; but that Area 2, as pleaded, in fact extended beyond that so as to encompass the area of unbonded, and allegedly dangerous, brickwork to its left, which the judge described as Area 4. That was an area where (unlike the area to the right of Area 2) there were no "headers", being bricks used to tie two single skins of brickwork to form a solid wall.

Despite Mr Underwood's sustained submission, I regard the argument as wrong. Paragraph 3.2.2 described Area 2 in narrow terms as "a bowed area of bulging brickwork in the area shown edged blue on the plan". That language was inapt to include Area 4. The order of 19 September 2006 required the area of "bulging brickwork" to be repaired, plainly a reference to the paragraph 3.2.2 area. The parties' experts agreed in a joint note of 31 October 2006 that Area 2, as referred to in that order, "measures approximately 3m high x 1.5m wide at and above first floor level, approximately 30m from the front elevation wall of the building." The judge adopted that description of Area 2 in his judgment – which at the trial was also variously referred to as the crack or the bulge -- and it could not and did not include what he called Area 4, being an area which, according to Mr Brumpton, BDC's expert engineer, extended some five metres to the left of what the judge (taking his lead from the experts) defined as Area 2.

In a further endeavour to make good his assertion as to the pleaded case, Mr Underwood's skeleton argument invoked paragraph 13 of Mr Tyler's amended Defence in aid of the proposition that the design and construction of the entire flank wall (including Area 4) were in issue at the trial. Paragraph 13 denied that the flank wall was, or was at risk of becoming, a nuisance as pleaded in paragraph 3 of the Particulars of Claim. It also pleaded that the bulge (Area 2) was caused by rainwater flowing from BDC's building. It continued:

"(b) the demolition of [BDC's] buildings on the Site has exposed the wall to wind loadings for which it was neither designed nor constructed;

(c) The wall was neither designed nor constructed to withstand the stresses as demolition, excavation or piling if carried out in a careful and reasonable manner (an ordinary use) to which it will probably be exposed by [BDC's] intended works on the Site."

BDC's response in its amended Reply was that it was unable to plead to the matters so raised until after full investigation and advice. In the event it did not plead to them. It never pleaded a case based on Area 4.

The question as to whether Area 4 was pleaded was raised during the trial, when Miss Hutton objected to the making of any case in relation to it. I will come to the particular exchanges about it, which are important. But it is convenient first to summarise Mr Underwood's further point that, whether pleaded or not, Area 4 was always squarely in issue between the parties. He said that it was, and always had been, common ground that Area 2 was regarded as embracing the wider area encompassing the unbonded area to the left of the bulge.

I am not persuaded that Mr Underwood made that assertion as good as he said it was. He referred to Mr Mills's report of 26 July 2006 and its discussion of the area of the bulge, which concluded that "[d]elamination has occurred to the wall i.e. the bricks have become unbonded causing bulge and vertical settlement." I do not regard that as doing other than refer to the immediate area of the bulge and do not accept that it referred to Area 4. Mr Underwood referred to the note of the joint site meeting of 18 August 2006 and to a reference in it to the agreement of Mr Hedley and Mr Mills that "the only option was to demolish and rebuild both the loose bricks [a reference to Area 1] and the bowed section of the wall [a reference to the area of the bulge]." I also do not regard that as supporting the view that anyone was then regarding Area 2 as encompassing Area 4.

Following the order of 19 September 2006, repair works were carried out to Area 2. No work was carried out to Area 4 -- or to what Mr Underwood said was really part of Area 2 -- yet I do not understand anyone to have suggested that Mr Tyler had failed to comply with the order. Following the repair works, the court directed the experts to discuss and consider the condition of Areas 1 and 2, the latter area being described in Buro Happold's meeting note of 19 October 2006 as that of "Bulging brickwork". That note is said to record uncertainty as to the integrity of the flank wall in an area to the right of the bulge, and perhaps to the left. Even if it did, it did not make either area an issue in the case if it was not in issue on the pleadings. I have referred to the experts' later agreement in their joint note of the meeting of 31 October 2006 as to the limit of the extent of Area 2, one directly contrary to Mr Underwood's submission that Area 4 was really part of Area 2. That note also recorded Mr Brumpton's view that the condition of the wall beyond the agreed limits of Area 2 was unknown: the remedial works had not gone beyond the immediate area of the bulge. We were referred to a joint experts' statement signed by Messrs Curtis, Brumpton and Eastham on 20 November 2006, just before the start of the trial. As to Area 2, which they described as the "Bulge", the report recorded (i) that Mr Brumpton's opinion was that the repair was inadequate because "it does not extend to the full extent of the area with no headers tying it back to the inner sections of the wall" (a reference to Area 4), and that (ii) Mr Curtis's belief was that the repair was adequate as it had treated the area of wall that had bulged. Mr Curtis was right. Mr Brumpton was introducing a new area of complaint in relation to Area 4.

Mr Underwood was, however, correct that at the trial both engineering experts gave evidence relating to the construction of the wall, including the unbonded area to the left of the bulge. He referred to the first report that Mr Curtis (for Mr Tyler) made on 14 November 2006. Mr Curtis dealt with "Area 2 – The Bulge" at paragraph 3.4, and at paragraphs 3.4.15.10 to 3.4.15.13 made his observations on what Mr Edginton (BDC) had said about the construction of the wall either side of the bulge, namely that to the right the wall was tied back to the inner skin of brickwork by "headers" (so-called "English Bond"), whereas to the left there were no headers and the wall was effectively freestanding. Mr Curtis agreed that the area to the left was unbonded but disagreed with any suggestion that this weakness was a cause of the bulge in Area 2. Nor was that part of BDC's case.

Mr Underwood also referred to Mr Brumpton's report dated 16 November 2006. He too referred to the lack of headers in the area to the left of the crack (or bulge) and referred (wrongly) to this brickwork as being in Area 2. He described this area as "effectively free standing as it has not been bonded to the inner sections of the wall" and considered it unsafe. His cross-examination on 24 November 2006 included questions as to the safety of that area, which he thought extended to about five metres, that being the "the visible section of no headers."

During the adjournment of the trial, the experts re-visited the scene and produced further reports. Mr Curtis's report was dated 4 January 2007 and in paragraph 4.8 he expressed his view on how it might have come about that the wall included a section that was "stretcher bond only" (ie no headers, a reference to Area 4). His suggestion was that it would have been an infill of a gap at some stage. Mr Brumpton's report was dated 5 January 2007 and his "Findings" in it included that "area 2 is unstable by virtue of the fact that it is a section of single skin outer leaf which is unbonded to the inner section of the wall. This section extends for a width of approximately 6m from the crack. In height it extends from the flashing line to at least the section exposed by our investigation." He regarded the cause of the bulge as the rusted beam embedding into the wall. That was the first time that explanation was advanced, and by 8 January 2007 it was agreed as the cause of the bulge. But regardless of that, Mr Brumpton also said that "the danger caused by area 2 is the unbonded outer leaf that would have still been a danger if the wall had not cracked or bulged at the interface between the two types of construction." He was still misdescribing the extent of Area 2, although he was there referring also to Area 2 properly so-called.

On 8 January 2007, on the resumption of the trial, Mr Brumpton was cross-examined by Miss Hutton on his report. She reminded him that he had agreed on 19 October 2006 that Area 2 was limited to an area 1.5m wide encompassing the area of the crack and the bulge and that it did not extend to the unbonded area to the left. She pointed out to him that it was only the areas then agreed that the case was about. It was, I understand, at that point that that unbonded area was first called "Area 4" (Miss Hutton's suggestion), about which she questioned Mr Brumpton. Mr Curtis was also cross-examined about it by Mr Underwood. He made it clear that he did not know the extent of Area 4 and could not do so until the remainder of BDC's wall had been taken down so as to enable investigation to be made. It was during Mr Curtis's cross-examination that Mr Underwood objected to calling the area "Area 4", his reason being "because it includes the crack and the bulge", a reason which, with respect, I regard as mistaken.

On 11 January 2007 Miss Hutton referred to the fact that Area 4 was a limited panel of flank wall that was known about, but that the continuation of it to the left was an unknown quantity because it stood behind the undemolished gable wall of the BDC site and so was concealed from view and investigation. At page 58 of the transcript, she made the point that (i) Area 4 was not pleaded, and (ii) was not unsafe, which was Mr Harle's opinion. The judge responded: "That is why I am reluctant to go into the area 4 area, quite apart from the fact that it is not pleaded. This is the danger of trying to anticipate things." At the conclusion of an extended submission by Miss Hutton, Mr Underwood rose to say he was troubled by the raising of a pleading point on Area 4. There followed this exchange:

"MR UNDERWOOD: My Lord, ... What I am troubled about is a pleading point that has been taken against me. Your Lordship appeared to agree with it, so I wondered –

JUDGE BROWN: My own thinking about it – and we can go to the pleadings – is that we have to look into the cause of the crack [ie that in Area 2]. Is that unsafe? One cannot just look at the crack in isolation, I have to look at either side immediately of the brickwork. Is that going to be unsafe because of the remainder of the construction of the wall? That is the way I look at it.

MR UNDERWOOD: Quite. That is the way I apprehend it was pleaded. Let us imagine for example that your Lordship were to conclude at the end of the day, just look at the current position, never mind what the historic position was, what you should do. You take the view the crack itself and the bulge had been sorted out by the CemTies, but there is an area to the left of what might be described as area 2, although I don't accept that, which is dangerous. We would say on the pleadings we are entitled to relief on that. That is the point. It is also, as your Lordship knows, relevant to causation of the bulge that the area is unbonded, but it is clearly relevant to that. So I want to make it entirely clear that certainly my application on the pleadings is that the whole wall or any part of the wall is encompassed within the pleading, because it says so in terms in paragraph 4.2 of the particulars of claim. Although we have, if I may respectfully say so, concentrated because of the injunction on the three specific areas to fix the emergency, we must not allow the way in which the injunction was framed and executed, as it were, to influence the way that the case was pleaded, and both Miss Holland and I have been very careful to say we run our case on the pleading. I was alarmed to hear my friend say that area 4, which is her construct, as it were, her phrase, is not pleaded. If it needs to be, then I seek to amend it.

JUDGE BROWN: I am not dealing with this case on the basis of a separate area from area 2. If it is allied to area 2, that is fine, but if it is a separate area, then it is a different matter.

MR UNDERWOOD: I am not suggesting it is. That is why I very laboriously had that cut-out shown to Mr Curtis.

JUDGE BROWN: The way I see it, you can have a crack in the wall that doesn't look very nice, but if it is the case that because of the surrounding area that crack is a dangerous one, then –

MR UNDERWOOD: I need say no more about it. In the light of all that, I apprehend it would be worth waiting for these documents before Mr Curtis is recalled."

Mr Underwood said that, as a result of that exchange, BDC did not seek permission to amend so as to plead a cause of action in respect of the unbonded area. It is to be noted that he was there asserting to the judge, wrongly in my view, that Area 4 was pleaded. Miss Hutton was correct that it was not. In response to Mr Underwood's submission, the judge did not rule that it was pleaded. His position was that if Area 4 was separate from Area 2, he was not going to deal with it, but that he would do so if it was allied to Area 2, and it may be that the sense of his final, interrupted remark was that it was or might be regarded as so allied if Area 4 was the cause of the danger in Area 2 (compare also the last three sentences of the judge's first quoted statement). That case, however, was not being made. The only connection between the two areas was that at the point of the crack (Area 2) the wall was also unbonded, which Mr Underwood said was the reason why the rusted beam was able to do the damage it did, damage which he said would not have happened if the wall had there been strengthened with headers. But there was no basis for any proposition that Area 4, whether dangerous or not, had caused the danger in Area 2.

In light of all he had read and heard, the judge made two findings. The first was the finding in paragraph 38, which I have quoted, where he referred to the potential danger to Area 2 because of the unbonded brickwork "beyond in Area 4". Mr Underwood said that observation was not easy to understand and I respectfully agree. But the judge then, in paragraph 44, which is the key paragraph, addressed himself separately to Area 4, and I have quoted that.

Mr Underwood criticised the judge's paragraph 44 conclusion as "woefully unjust". He said that even if the Area 4 case was not pleaded (and I am satisfied it was not) the parties gave evidence in relation to it and the judge indicated he would deal with it if it was allied to Area 2. He said the evidence of the experts about Area 4 was plain and essentially agreed. He said it was allied to Area 2 because in both areas the wall was unbonded. There was no justification for the judge's conclusion that the matter would involve either speculation or further investigation in order to establish the danger. It is said that, had the judge directed himself properly with regard to Area 4, he would have found the claim made out in respect of the unbonded area of brickwork. He ought, it is said, to have found that Area 4 presented a danger to the site.

Miss Hutton's response was that no claim in respect of Area 4 was pleaded and that omission was not a mere formality. BDC's pleadings claimed an injunction asking for Areas 1 and 2 to be made safe. If it was being suggested that an injunction should also be made in relation to Area 4, that needed to be spelt out as well but was not. It was not even known how far Area 4 extended, because full investigation was prevented by the presence of BDC's undemolished gable wall. She made an express objection at the trial that Area 4 was not pleaded. Despite that objection, BDC declined to make any amendment application. It cannot be said that, during the quoted exchange, the judge ruled that the Area 4 claim was pleaded. The most that can be said is that he made the perhaps somewhat Delphic observation that "If it is allied to area 2, that is fine, but if it is a separate area, then it is a different matter."

Miss Hutton's submission to the judge was that it was not so allied. BDC's case was that the Area 2 defect was caused by a leaking factory roof that had rusted the beam that had damaged the wall in an area (Area 2) that had presented danger. There was no expert evidence that the bulge was caused by any weakness in Area 4 nor was that BDC's case. The danger that the judge found in relation to Area 2 was the risk that the bulge might split and result in the falling of bricks and collapse of the wall at that point. Whilst Mr Underwood's stance was that Area 4 was allied to Area 2, the judge found it was not. He said in paragraph 44 that it was unpleaded separate area. He said it would be wrong in principle to speculate on this relatively unexplored area, and he declined to do so. His conclusion that Area 4 was not allied to Area 2 was unsurprising bearing in mind that paragraph 18 of BDC's own closing submissions before him said "That instability [of the unbonded area] was not caused by the bulge or the so-called crack, and is not connected with the causes of those features."

In my judgment there is no substance in this ground of appeal. For reasons given, Area 4 is not part of Area 2 and no Area 4 case was pleaded in paragraphs 3 or 4 of the Particulars of Claim. I recognise that the experts discussed Area 4 in their reports and oral evidence. But the issues at a trial are not determined by what the experts may say. Even in the 21^st century it is still essential to the fair conduct of a trial that each side should know what case it has to meet. The place in which that is done is the pleadings. As BDC never pleaded a case in respect of Area 4, Mr Tyler was not told what case BDC wanted to raise against him in relation to that area or what relief it was seeking against him in respect of it. The pleading point was raised by Miss Hutton during the trial, the judge did not rule that an Area 4 claim was pleaded but BDC declined to make any application for permission to amend even though it knew that this element of its case was said to be closed to it. BDC's refusal to ask for permission to amend was a deliberate decision. It could have sought permission, although whether with success is another matter. The arguments now advanced, relying as they do on the evidence about Area 4 adduced at the trial, might have justified an application for permission to amend. But they cannot justify a complaint that the judge ought nonetheless to have decided a case that was not before him. Although Mr Underwood argued strenuously to the contrary, I am satisfied that the judge was entitled to conclude, as he did, that Area 4 was not "allied" to Area 2: the issues in relation to each were essentially different. Nor in my view, given what he regarded as the incomplete exploration of Area 4, was the judge wrong to conclude that he should not speculate on or rule in relation to it. In my judgment he was justified in taking the course he did.

I would therefore reject BDC's criticism of the judge's judgment on ground 3. It is in any event difficult to see how a case in nuisance in respect of Area 4 could have been made good against Mr Tyler. It could not be said he had acted unreasonably in failing to remedy that alleged defect prior to the issue of the proceedings, when the discovery of it only followed their issue. I would dismiss BDC's appeal on ground 3.

Ground 4

The essence of this ground is that the judge misdirected himself as to the cause of the Area 2 defect and reached a perverse conclusion in finding that it was caused by BDC. This is a ground in respect of which Mr Underwood renewed BDC's application for permission to appeal.

The issue is as to the source of the water that caused the rusting of the joist behind the bulge. Was it, as BDC claimed, leaks through the factory roof? Or was it, as Mr Tyler claimed, the leaking valley gutter and down pipe on BDC's building? Mr Underwood pointed out that there were evidential difficulties in relation to this issue represented by the fact that BDC's building had been demolished before this issue became a live one. He explained how the evidence on this issue divided sharply.

First, there was evidence from Mr Tyler that, before the commencement of that demolition in mid-June 2006, the factory roof did not leak. That was supported by Mr Dunger, his surveyor. Second, however, there was evidence to the effect that Mr Tyler's factory roof had been leaking for many years and that the flank wall showed significant long-standing damage as a result. This was supported by photographs taken by BDC's party wall surveyors and by an agreed condition report signed by the parties' party-wall surveyors. Those photographs showed a roof/ceiling leak extending to the wall, with matching damage down the inside of the wall directly above the rusting beam. Mr Underwood submitted it followed that Mr Tyler's and Mr Dunger's evidence was plainly wrong. He said there was evidence that the roof had leaked for a considerable time in precisely the place it would have needed to leak in order to get the beam wet.

Mr Underwood said it was also common ground that the valley gutter and down pipe had not leaked since 1999, yet when the factory wall was inspected on 18 August 2006 it was very wet at ground floor level. It was beyond belief that wetness in the factory wall could have remained there as a result of the gutter/down pipe leak which had ceased in 1999 rather than from a continuing roof leak. Despite all that evidence the judge found the sole source of water reaching and rusting the joist to be BDC's gutter/downpipe. Mr Underwood submitted that his finding was perverse.

Miss Hutton referred to what the judge said about this issue in his judgment. In paragraph 10, and again in paragraph 39, he referred to Mr Harle's report, to which I have also referred. Mr Harle had inspected Area 2 on behalf of Coleman in July 2006 and his assessment was that the evidence suggested that the bulge had:

"occurred some time ago possibly when the wall was built as some of the bricks appear to have been cut to accommodate the movement. There is also evidence of water seepage which has removed the lime from the mortar between the bricks." (emphasis added)

In paragraph 22, the judge explained how the cause of the Area 2 defect was the subject of considerable investigation at the trial, including two views of Area 2 in detail, during one of which:

"I even climbed a ladder to look into the crack and missing brickwork and looked closely at the counterpoint in Mr Tyler's factory, as well as the surrounding areas of water damage and damp on both sides …."

In the same paragraph, the judge explained the rival theories as to the cause of the water damage. He said he derived little help from the opinions of the consulting engineers; and whilst Mr Eastham, a building surveyor called by BDC, gave evidence on the topic, the judge found it unconvincing and unreliable and could place no reliance on it. The judge did not, however, say that he derived no help from the engineers and it is plain that he in fact derived some help from Mr Curtis's evidence, who had greater experience of old buildings than Mr Brumpton. In paragraph 39 he said he derived from Mr Harle's report that the bricks in Area 2 had been intentionally cut and that the water seepage was considerable and over a long period of time. In paragraph 41 he referred to a late visit to the site by Mr Curtis and Mr Brumpton, which revealed the remnants of some wet rotted wood in an aperture that all had previously thought was created by a missing brick. It was that rotted wood, which had been inserted in the external face of the wall, to which he was referring at the beginning of his conclusions in paragraphs 42 and 43 that I have quoted.

In coming to his conclusions, the judge had himself examined all parts of the flank wall twice – with the second visit including a specific examination of the crack in order to test the evidence he had heard as to the cause of the rusting of the steel beam end. He also had Mr Curtis's evidence as to the extent, location and profile of the damp as well as the extensive photographic evidence of both the interior and exterior of the wall at Area 2. The purpose of his inspections was to look for signs that water from the roof contributed to the damage to the bulge. He looked at the wall from both the inside and outside and found no signs justifying the conclusion that the offending water had come from roof leaks. In the light of all that, he made the finding he did that the defect was wholly caused by BDC's leaking gutter.

Whilst Mr Underwood said that this was a case of the judge trying to be an expert, which he was not, Miss Hutton submitted that the judge was entirely justified in making that finding and that there was nothing perverse about it. During his two lengthy site visits, he saw and touched the material parts of the wall. He carried out his second inspection, including of Area 2, after the rival contentions had been advanced in evidence. He believed the evidence of Mr Tyler, his son, Mr Dove and Mr Dunger as to the absence of significant leaks through the roof of the first floor of the factory prior to the demolition works on the site. He did not accept the opinion evidence of Mr Brumpton, whom he found generally unreliable and insufficiently expert in relation to old buildings and the matters of building surveying. Apart from the photographs upon which BDC primarily relied, the only evidence of significant leaks was Mr Edginton's observation in his file note of 18 August 2006 of a pool of water internally. Mr Tyler's evidence in response to that was that the roof had not leaked prior to the demolition but that afterwards the factory did begin to suffer leaks and there was torrential rain on 18 August 2006. He found the roof was leaking but quite a way from the area where the wall was damp. There was also important evidence from Mr Tyler that the area was a storage area for finished stock and he could not have put it in an area suffering from leaks, which would have damaged it. Mr Dove also gave evidence that there had not been any substantial leaks prior to the demolition.

It was agreed that in August 2006 the wall in Area 2 was saturated internally and externally, but whereas BDC's suggested explanation was that that was caused by leaks through the roof into the interior of the factory, Mr Brumpton's different theory was that water from the roof had saturated the wall. Mr Eastham, BDC's building survey expert, was of the opinion that water ingress had nothing to do with the bulge. He did not, therefore, support either the BDC case or the Brumpton theory. The judge of course placed no reliance on his evidence. Mr Curtis's evidence was that he had seen very little evidence of leaking within the factory and whilst he accepted that there was evidence of high level water saturation, he was not convinced it was the cause of the rusting of the beam end. He gave a good deal of evidence about the matter, although I have said that the judge indicated that he did not regard Mr Curtis's professional expertise as such as to provide great help on the issue. He was, however, particularly impressed by Mr Dunger's evidence, in line with Mr Tyler's, that there had been no significant leaks through the roof of the factory such as could have been a material cause of the saturation of the part of the factory wall where the steel beam had rusted and caused the bulge.

It is apparent that the judge had a good deal of conflicting evidence before him on what was a difficult question of fact. That evidence included the photographic evidence of damp and the agreed condition report prepared by the surveyors, which Mr Underwood relied upon before us as proving BDC's case on this issue. But the judge was obviously fully aware of that evidence, although he also had evidence before him to different effect. The question before him was obviously not easy, and it is equally obvious that he was sensitive to its difficulty. His task was, however, to make a finding on it and he did so, and very conscientiously. He expressed his conclusions in a succinct and clear judgment, its essence on this point being that he preferred the explanation advanced by Mr Tyler and his expert witnesses, in particular Mr Dunger. Mr Underwood's cogent submissions did not begin to convince me that the judge's decision on this issue was either perverse or even against the weight of the evidence. I can see no basis on which this court could substitute a different finding as to the cause of the rusting, which is what Mr Underwood asked us to do. I would refuse permission to appeal on ground 4.

Result

I would refuse BDC permission to appeal on grounds 2 and 4 and would dismiss its appeal on grounds 1 and 3.

Lord Justice Rix :

I agree.

The Chancellor :

I also agree.