Two recent cases relating to Japanese knotweed have provided further clarity on developers’ (and landowners’ generally) duties and neighbouring landowners’ rights when faced with the presence of the invasive species.
Japanese knotweed is an invasive species which notoriously costs significant amounts of money to try to eradicate and can cause significant damage to land and buildings. The damage it can cause means that it can severely impact a landowner’s ability to insure their property and it is of no surprise that land and buildings subject to Japanese knotweed can be significantly more difficult to market and that lenders may refuse to lend if the presence of the species is known.
It is not an offence to have the species growing on land but the owner of the land subject to Japanese knotweed can be held liable for common law nuisance and neighbouring landowners can claim damages. This was the case in Davies v Bridgend County Borough Council. Here, the Council’s land had had the species growing on it for some time and although the Council treated it, the roots remained. Mr Davies brought a claim against the Council alleging that the value of his property had diminished because of the ‘blight’ against his land and property.
Mr Davies was successful in the Court of Appeal. The Court agreed that the presence of Japanese knotweed could constitute an actionable nuisance so long as it was not ‘trivial’. Significantly, the Court held that there was no need to demonstrate that it caused a risk of damage to structures on neighbouring land or that there was an increased difficulty in developing the land. The persisting encroachment onto Mr Davies’ land was held to be a ‘continuing nuisance’. As such Mr Davies was entitled to damages representing the diminution in the value of his property.
Where a site consists of or includes residential units, developers may now find themselves subject to more extensive and specific enquiries relating to the presence (including the historic presence) of Japanese knotweed given the recent case of Downey v Henderson.
Here, a homeowner answered ‘no’ to the question on the property information form which specifically asked if the property had ever been affected by knotweed. The buyer subsequently found a large presence of knotweed in the garden and successfully claimed damages against the seller. Damages were awarded because the Judge found that the seller did not genuinely believe that the property was not affected by knotweed at the time it was sold.
Although the property information form is not applicable in the context of sales of new builds by developers, it is likely that more purchasers will be asking questions about Japanese knotweed and care will need to be taken to ensure there is no misrepresentation when providing the relevant answers.
Japanese knotweed cases are on the rise and these recent cases, which have had widespread press coverage, may mean that we will see a further rise.
Whilst the judgments will be good news for those who purchase land affected by Japanese knotweed clearly these cases will now make it difficult, and potentially very expensive, for developers with knotweed on their land.
Developers need to be aware of the risks of Japanese knotweed both when identifying potential sites and when selling the units post construction. Risks can now potentially include claims and liability for loss of enjoyment / a residual diminution in value, property damage, costs of removal, and a continuing injunction to prevent reinfestation.
Developers will also need to bear in mind the approach taken by residential lenders’ when it comes to knotweed. Its existence would need to be disclosed to the mortgage lender and whilst there is currently no common approach taken by mortgage companies to the existence of knotweed, each lender is likely to have their own criteria and instructions, which will be informed by their own valuers. The Royal Institution of Chartered Surveyors (‘RICS’) has released new guidance for valuers and surveyors in connection with assessing the risk where the presence of knotweed is known about which is said to reflect ‘…an improved understanding of Japanese knotweed’, and is designed to ‘rebalance perceptions’. It is hoped that the report may pave the way for lenders to take a more nuanced approach to considering the risk associated with knotweed.