Beaumont Business Centres V Florala Properties Ltd – Update

The case of Beaumont v Florala has a long and complex history, which began with Beaumont developing and refurbishing its high-end serviced offices, to which Florala had raised right of light concerns. Rather than seeking compensation or changes to the design, Florala attempted to negotiate reciprocal rights, a ‘build and let build’ arrangement. Whilst Beaumont was willing to negotiate and rectify the light claim, they had concerns over the light impact from Florala’s potential development on its newly refurbished offices.

Beaumont completed its development in 2015 and the new offices were leased, which also included an agreement as to how any compensation resulting from a claim against Florala’s development would be split. Later in 2015, Florala obtained planning permission to build a hotel. The right of light analysis in relation to Beaumont’s property was subsequently agreed between the elected surveyors, and £155,000 was offered to Beaumont in order to settle their claim. This was the equivalent of a five times uplift to the book value. Upon requesting to whom the payment was due, Beaumont disclosed the lease that contained the agreement as to how any compensation would be shared. The matter then went quiet for six months.

Contending that Beaumont was only trying to extract money from the development, Florala contended they had no claim and proceeded with the development.

In 2018 Beaumont issued proceedings for an injunction. Florala applied to the courts for a summary judgement, arguing that the application for the injunction had no real chance at success because of the lease arrangement. The High Court dismissed Florala’s application and, at the end of 2015, the development was completed and let on a 15 year lease.

Judge’s Comments

• The judge reinforced the use of the 50/50 Waldram method, but also accepted arguments of radiance. The court rejected the use of reflected light, as Beaumont would have no right to have the reflected light maintained.
• Despite the losses being small, and the fact that the rooms at Beaumont’s property were already poorly lit, the judge contended that the loss did constitute a nuisance as it was perceptible and did have an impact on the building’s rental value.
• The fact that Beaumont did not object at planning was not significant as, in order to avoid an injury occurring, Florala only had to have a relatively small cutback which meant that the planning permission would not be undermined.
• The suggestion that the claimant could install better windows to allow more light to penetrate through was no defence.
• Given that the cutback necessary was only small, it showed that Florala intended to maximise its profits at the expense of Beaumont’s light, which played a factor in considering the conduct of the parties.