Court considers liability for damage caused under the Party Wall Act 1996

In a recent case a building owner (BO) had complied with the Party Wall Act 1996 (PWA) procedure before carrying out work, but substantial damage to adjoining properties had occurred during the works. However, there was expert evidence which clearly showed that the adjoining properties had significant pre-existing problems. In fact the terminology used was the buildings were "on a hair-trigger", and any slight movement could have caused substantial damage. In fact is so happened that the work done in this case was just that trigger.

A surveyor had been appointed under the set procedures under the PWA, and had initially decided that the BO should pay the entire costs of the remedial works. In the circumstances, understandably, the BO was not happy with this and felt it was unfair, so appealed first to the County Court, and then on to the Court of Appeal (CoA).

After hearing all of the evidence, the CoA decided that BO was not liable to pay for all of the repairs, and held that:

The PWA 1996 states that a building owner should compensate adjoining owners for "any loss or damage which may result to any of them by reason of any work executed in pursuance of this Act". The CoA felt that common law principles for assessing damages remained applicable.

Five questions arise in such cases:

1 What damage had been caused by the works?

2 How should adjoining owners be compensated?

3 What work was necessary to repair the relevant damage?

4 Whether any deduction should be made for betterment (i.e. any improvement)?, and

5 What was the actual cost of carrying out the relevant repairs?

In this particular case question 3 was the most significant. Here the BO's work had caused damage to internal walls and slabs. That was relevant damage. The experts agreed that remedial work to the adjoining properties also required underpinning of their rear wall and that no engineer would approve a remedial scheme without such work, but that was not relevant damage for which the building owner was liable because it had not been caused by the BO's work.

This is a decision which many may consider to be fair, reasonable, and logical. As ever, the facts of each individual case are always the most significant factor, and in this case the pre-existing damage was extremely relevant to the amount of compensation which was awarded. It also serves as a very useful reminder to those intending to carry out works in and around party walls of the importance of following the procedures under the PWA. Had there not been expert evidence relating to the condition of the properties prior to the relevant work, the BO may well have ended up having to pay a considerably larger sum.