WILLIAM TRACEY LIMITED AGAINST SP TRANSMISSION PLC
OUTER HOUSE, COURT OF SESSION
[2016] CSOH 14
CA45/15
OPINION OF LORD BRODIE
In the cause
WILLIAM TRACEY LIMITED
Pursuer;
against
SP TRANSMISSION PLC
Defender:
Pursuer: Dean of Faculty, Irvine; Pinsent Masons LLP
Defender: Wilson QC, G Walker; DWP LLP
19 January 2016
Introduction
[1] The pursuer is William Tracey Limited. It is a recycling and waste management company. It is the heritable proprietor of land at 49 Burnbrae Road, Linwood, Paisley (the “Linwood Site”). The site was purchased by a related party to the pursuer, the William Tracey Private Pension Fund (the “Pension Fund”) in 1996. The pursuer leased the site from the Pension Fund by lease dated 23 and 29 June 1998 and registered in the Books of Council and Session on 9 July 1998. The date of entry under the lease was 31 December 1997. The pursuer occupied the site by agreement with the Pension Fund from 27 September 1997. Since that date, the pursuer has been the operator of the facility at the Linwood Site and has possessed the site, initially as tenant, and, since 2006, as proprietor.
[2] The defender is the owner and operator of the electricity transmission network in central and southern Scotland. It is a licence holder for the purposes of the Electricity Act 1989 (the “1989 Act”). The electricity transmission network owned and operated by the defender includes the Elderslie to Johnstone 132kV overhead power line known as the “AU Route”) (the “AU Route”). Overhead electricity cables forming part of the AU Route bisect the Linwood Site in an east-to-west direction. Those cables are supported by a lattice steel tower identified by the alphanumeric AU005 (“AU005”). AU005 is located close to the Linwood Site’s eastern boundary. AU005, the overhead cables it supports, and their associated apparatus (together, the “Equipment”) have been in situ since the pursuer first took possession of the Linwood Site in 1997.
[3] As the holder of a transmission licence, the defender has, by virtue of section 9 of the 1989 Act, certain duties and, by virtue of section 10 of the Act, certain powers. The powers include the acquisition of wayleaves, these being consents to the installation and keeping installed of electrical lines on, under or over land and to subsequent access to the land for the purposes of inspection and maintenance etc. Provision is made for the acquisition and temporary continuation of wayleaves by paragraphs 6 to 8 of schedule 4 to the Act. A wayleave may be granted by agreement between the owner or occupier of the land and a licence holder (a “voluntary wayleave”) or it may be granted by the Scottish Ministers on application being made to them by the licence holder in the event of it being necessary or expedient to install etc an electric line in circumstances where the owner or occupier of the land has failed to give a wayleave when required by the licence holder to do so (a “necessary wayleave”). Where a necessary wayleave is granted by the Scottish Ministers, paragraph 7 of schedule 4 provides for the recovery by the occupier/owner of the land of compensation in respect of the grant. The wayleave, whether it be a voluntary wayleave or a necessary wayleave is of the nature of a personal right. It confers no interest in the land on the licence holder. It does not bind a singular successor as owner or occupier or the land.
[4] The predecessor in title to the Pension Fund as proprietor of the Linwood Site was Thomas Houston & Son (Johnstone) Limited (“Houston”). In terms of an agreement dated 26 April and 1 May 1991, Houston granted a voluntary wayleave in favour of Scottish Power plc for the installation etc of the Equipment on the Linwood Site.
[5] In or about 2005 the defender approached the pursuer seeking the grant of a voluntary wayleave in respect of the Equipment on the Linwood Site. The pursuer declined to grant a voluntary wayleave. On 8 December 2010 the pursuer issued a notice of removal to the defender in accordance with paragraph 8 of schedule 4 to the 1989 Act. The notice required the removal of the Equipment by the defender within 3 months of the date of the notice. On 3 March 2011 the defender submitted an application to the Scottish Ministers for a necessary wayleave in respect of the Linwood Site pursuant to paragraph 6 of schedule 4 to the 1989 Act. On 17 February 2014, the pursuer signed an agreement with the defender by which the pursuer consented to the continued presence of the Equipment on and over the Linwood Site for a limited period of two years and to the Scottish Ministers granting a necessary wayleave in those terms. Under the agreement, the pursuer consented to the wayleave for the sole purpose of facilitating the efficient removal of the Equipment and the diversion of the AU Route away from the Linwood Site. On 13 August 2014, following the recommendations of a reporter, the defender’s applications of 3 March 2011 and 21 June 2012 were granted by way of a single wayleave.
The pursuer’s claim
[6] The necessary wayleave granted on 13 August 2014 was of prospective effect only. In the circumstances the pursuer contends that from the date of the acquisition of the Linwood Site by the Pension Fund in 1997 until 13 August 2014, no wayleave or consent of any sort was in place and therefore the presence of the Equipment constituted an unlawful encroachment by the defender on the pursuer’s property. In this action the pursuer sues for what it avers is its consequential damage which it assesses in the sums of (a) £4,686,727.66 and (b) £1,419,365.27.
Parties’ position at debate
[7] The case called for debate on the defender’s general plea to the relevancy. The pursuer was represented by the Dean of Faculty and Ms Irvine. The defender was represented by Ms Wilson QC and Mr Gavin Walker. Parties had previously lodged written notes of argument. When she came to address the court, Ms Wilson’s primary motion was for dismissal on the ground that in the circumstances disclosed by the pursuer’s averments, the presence of the Equipment on the Linwood Site during the period between the change in ownership and occupation of the land in 1997 and the grant of a necessary wayleave by the Scottish Ministers in 2014 did not amount to encroachment. Ms Wilson had two fall-back arguments in the event that her primary argument was unsuccessful: first, that there was no basis for a damages claim for the period after the notice to remove was served; second, that, given the terms of the lease by the Pension Fund in its favour, the pursuer had failed to instruct its title to sue qua tenant in respect of the period between taking entry under the lease and acquiring title as proprietor.
[8] Although the debate was on the defender’s plea, because the defender took the position, as set out in its note of argument, that the question as to whether a delict is committed by a licence holder who maintains equipment on land after a change of ownership/occupation had been determined in its favour by the decision of Lord Glennie in Patersons of Greenoakhill v SP Transmissions Limited 2010 SLT 115, parties had agreed that the pursuer should begin the debate with a view to explaining the basis upon which it was said that the presence of the Equipment had amounted to an encroachment. I therefore heard the Dean of Faculty first and then Ms Wilson. The Dean of Faculty replied in a brief second speech.
Relevant statutory provisions
[9] The Electricity Act 1989 provides, inter alia:
“9. General duties of licence holders.
...
(2) It shall be the duty of the holder of a licence authorising him to transmit electricity—
(a) to develop and maintain an efficient, co-ordinated and economical system of electricity transmission;
...
10. Powers etc. of licence holders.
(1) Subject to subsection (2) below, Schedule 3 to this Act (which provides for the compulsory acquisition of land) and Schedule 4 to this Act (which confers other powers and makes other provision) shall have effect—
(a) in relation to . . . a person authorised by a licence to transmit electricity; and
(b) to the extent that his licence so provides, in relation to an electricity distributor or any other licence holder;
and references in those Schedules to a licence holder shall be construed accordingly.
(2) Where any provision of either of the Schedules mentioned in subsection (1) above is applied to a licence holder by his licence, it shall have effect subject to such restrictions, exceptions and conditions as may be included in the licence for the purpose of qualifying that provision as so applied or any power or right conferred by or under it.
...
SCHEDULE 4
OTHER POWERS ETC. OF LICENCE HOLDERS
...
“Acquisition of wayleaves
6.-(1) This paragraph applies where-
(a) for any purpose connected with the carrying on of the activities which he is authorised by his licence to carry on, it is necessary or expedient for a licence holder to instal and keep installed an electric line on, under or over any land; and
(b) the owner or occupier of the land, having been given a notice requiring him to give the necessary wayleave within a period (not being less than 21 days) specified in the notice-
(i) has failed to give the wayleave before the end of that period; or
(ii) has given the wayleave subject to terms and conditions to which the licence holder objects;
and in this paragraph as it so applies "the necessary wayleave" means consent for the licence holder to instal and keep installed the electric line on, under or over the land and to have access to the land for the purpose of inspecting, maintaining, adjusting, repairing, altering, replacing or removing the electric line.
(2) This paragraph also applies where-
(a) for any purpose connected with the carrying on of the activities which he is authorised by his licence to carry on, it is necessary or expedient for a licence holder to keep an electric line installed on, under or over any land; and
(b) the owner or occupier of the land has given notice to the licence holder under paragraph 8(2) below requiring him to remove the electric line;
and in this paragraph as it so applies ‘the necessary wayleave’ means consent for the licence holder to keep the electric line installed on, under or over the land and to have access to the land for the purpose of inspecting, maintaining, adjusting, repairing, altering, replacing or removing the electric line.
(3) Subject to sub-paragraphs (4) and (5) below, the Secretary of State may, on the application of the licence holder, himself grant the necessary wayleave subject to such terms and conditions as he thinks fit; and a necessary wayleave so granted shall, unless previously terminated in accordance with a term contained in the wayleave, continue in force for such period as may be specified in the wayleave.
(4) The Secretary of State shall not entertain an application under sub-paragraph (3) above in any case where-
(a) the land is covered by a dwelling, or will be so covered on the assumption that any planning permission which is in force is acted on; and
(b) the line is to be installed on or over the land.
(5) Before granting the necessary wayleave, the Secretary of State shall afford-
(a) the occupier of the land; and
(b) where the occupier is not also the owner of the land, the owner,
an opportunity of being heard by a person appointed by the Secretary of State.
(6) A necessary wayleave granted under this paragraph-
(a) shall not be subject to the provisions of any enactment requiring the registration of interests in, charges over or other obligations affecting land; but
(b) shall bind any person who is at any time the owner or occupier of the land.
(7) Where in pursuance of a necessary wayleave granted under this paragraph a licence holder has erected on any land supports for an electric line, he shall be deemed to have an interest in that land for the purposes of section 7 of the [1966 c. 4.] Mines (Working Facilities and Support) Act 1966.
(8) In this paragraph "dwelling" means a building or part of a building occupied, or (if not occupied) last occupied or intended to be occupied, as a private dwelling or, in relation to Scotland, a private house, and includes any garden, yard, outhouses and appurtenances belonging to or usually enjoyed with that building or part.
Provisions supplementary to paragraph 6
7.-(1) Where a wayleave is granted to a licence holder under paragraph 6 above-
(a) the occupier of the land; and
(b) where the occupier is not also the owner of the land, the owner,
may recover from the licence holder compensation in respect of the grant.
(2) Where in the exercise of any right conferred by such a wayleave any damage is caused to land or to moveables, any person interested in the land or moveables may recover from the licence holder compensation in respect of that damage; and where in consequence of the exercise of such a right a person is disturbed in his enjoyment of any land or moveables he may recover from the licence holder compensation in respect of that disturbance.
(3) Compensation under this paragraph may be recovered as a lump sum or by periodical payments or partly in one way and partly in the other.
(4) Any question of disputed compensation under this paragraph shall be determined by the Tribunal; and sections 2 and 4 of the [1961 c. 33.] Land Compensation Act 1961 or sections 9 and 11 of the [1963 c. 51.] Land Compensation (Scotland) Act 1963 shall apply to any such determination.
Temporary continuation of wayleaves
8. - (1) This paragraph applies where at any time such a wayleave as is mentioned in paragraph 6 above (whether granted under that paragraph or by agreement between the parties)-
(a) is determined by the expiration of a period specified in the wayleave;
(b) is terminated by the owner or occupier of the land in accordance with a term contained in the wayleave; or
(c) by reason of a change in the ownership or occupation of the land after the granting of the wayleave, ceases to be binding on the owner or occupier of the land.
(2) The owner or occupier of the land may-
(a) in a case falling within paragraph (a) of sub-paragraph (1) above, at any time after or within three months before the end of the period specified in the wayleave;
(b) in a case falling within paragraph (b) of that sub-paragraph, at any time after the wayleave has been terminated by him; or
(c) in a case falling within paragraph (c) of that sub-paragraph, at any time after becoming the owner or occupier of the land by virtue of such a change in the ownership or occupation of the land as is mentioned in that paragraph,
give to the licence holder a notice requiring him to remove the electric line from the land; but the licence holder shall not be obliged to comply with such a notice except in the circumstances and to the extent provided by the following provisions of this paragraph.
(3) Where within the period of three months beginning with the date of the notice under sub-paragraph (2) above the licence holder makes neither-
(a) an application for the grant of the necessary wayleave under paragraph 6 above; nor
(b) an order authorising the compulsory purchase of the land made by virtue of paragraph 1 of Schedule 3 to this Act,
the licence holder shall comply with the notice at the end of that period.
(4) Where-
(a) within the period mentioned in sub-paragraph (3) above the licence holder makes an application for the grant of the necessary wayleave under paragraph 6 above; and
(b) that application is refused by the Secretary of State,
the licence holder shall comply with the notice under sub-paragraph (2) above at the end of the period of one month beginning with the date of the Secretary of State's decision or such longer period as the Secretary of State may specify.
(5) Where-
(a) within the period mentioned in sub-paragraph (3) above the licence holder makes an order by virtue of paragraph 1 of Schedule 3 to this Act authorising the compulsory purchase of the land; and
(b) that order is not confirmed by the Secretary of State,
the licence holder shall comply with the notice under sub-paragraph (2) above at the end of the period of one month beginning with the date of the Secretary of State's decision or such longer period as the Secretary of State may specify.”
Submissions
Pursuer
[10] The Dean of Faculty began with a consideration of the relevant provisions of the 1989 Act. Paragraph 6 of schedule 4 authorised a licence holder to apply to the Scottish Ministers for a grant of a necessary wayleave in which case the landowner/occupier was entitled to compensation “in respect of the grant”. However, the statutory provisions only provide for compensation as at the date the wayleave is granted: Welford v EDF Energy Network (LPN) PLC [2007] 2 P&CR15 301. Compensation is not available in respect of an earlier period. Paragraph 8 was a critical provision. As appeared from paragraph 8(1)(c), a wayleave is no longer binding once there has been a change in the ownership/occupation of the land. Paragraph 8(2) relieved the licence holder of the obligation which it would otherwise have to comply with a notice to remove. Accordingly, the subparagraph displaced, for a defined period, the common law as regards the availability of removal as a remedy for the delict on encroachment. But that was all. The issue for the court was whether, despite there being no effective wayleave and the limited nature of the licence holder’s rights in this interim period, the 1989 Act nevertheless trumped any claim an owner/occupier had at common law.
[11] As a matter of common law, the delict of encroachment is committed by the permanent or quasi-permanent intrusion by something into land which is owned or otherwise lawfully possessed by another person. The very fact of an encroachment is an injuria, meaning that “every encroachment, though it should not be guarded against by statute, founds the proprietor in an action of damages”: Erskine Institute II.i.1 provided loss can be shown. A person in occupation of heritable property on a possessory title of lease may sue for damages in the same way as a proprietor can.
[12] An action of damages is one of two remedies available to a proprietor or possessor of land in respect of an encroachment. The other remedy is interdict with an order to remove the encroachment. The remedies of removal and damages are distinct and separate. Consent is a defence, but consent is personal to a person granting it: as a general rule, successors in title are not bound by consent to an encroachment given by a predecessor.
[13] In the submission of the Dean of Faculty, the result of the superimposition of the 1989 Act on the common law was that where an owner had granted a voluntary wayleave to a licence holder and thereafter the ownership of the land was transferred, the voluntary wayleave would not bind the new owner who could then give a notice to the licence holder to remove from the land. In these circumstances paragraph 8(2) operated to free the licence holder from the obligation to remove and therefore the landowner could not enforce what would otherwise have been one of his remedies. However, the statute said nothing about the remedy of damages which, in the Dean of Faculty’s submission, remained open to the landowner. If, on a proper construction of the 1989 Act, the remedy of damages in respect of encroachment was not available to a landowner during a period when no binding wayleave was in place, the landowner would be obliged to suffer encroachment without any compensation. That would fail to strike a fair balance as between the public interest in maintaining an electrical supply and the private interest in being able fully to enjoy one’s property. The pursuer’s position was supported both by the interpretative presumption against implied revocation of a common law rule and the protection of property afforded by article 1 of the First Protocol to the European Convention on Fundamental Rights and Freedoms, as given effect by the Human Rights Act 1998. That the licence owner only had immunity against the remedy of removal and not the remedy of damages was supported by the headnote to paragraph 8 of schedule 4: “Temporary continuation of wayleaves”: cf R v Montilla [2004] 1 WLR 3141 at paragraphs 34 and 36.
Defender
[14] Ms Wilson began by stating three main contentions: (1) the defender’s primary position was that in the circumstances of the case there had been no encroachment on the site; (2) if that is wrong, there could be no encroachment by the defender following upon the service of the notice to remove; (3) while it was not disputed that as a matter of generality a tenant might sue for damages in respect of encroachment, in the present case the pursuer’s averments were insufficient to establish a possessory interest which had been encroached upon in respect of the period when the pursuer had held the Linwood Site on lease. Ms Wilson reminded me of the context in which these contentions fell to be considered. The 1989 Act provided a scheme for the continued and economical supply of electricity following upon privatisation of the industry. The business was regulated so as to ensure that it was conducted in the interests of the public and duties were imposed on licence holders accordingly. Ms Wilson did not disagree with much of what had been submitted by the Dean of Faculty, both in relation to the common law of encroachment and the proper interpretation of the 1989 Act. It was for example common ground that paragraph 7 of schedule 4 only provided for compensation on the grant of a necessary wayleave. What was disputed was the Dean’s contention that a wayleave ceasing to be binding in terms of paragraph 8(1)(c) was to be equated with the wayleave having expired. Ms Wilson drew attention to the terms of the voluntary wayleave which had been agreed between Houston and Scottish Power plc. By virtue of that wayleave the licence holder became entitled to install and keep installed the Equipment and had conferred on it rights of maintenance and inspection such as were necessary to maintain supply. The wayleave also imposed obligations on the licence holder. It was Ms Wilson’s submission that these obligations remained in force, notwithstanding the fact that the wayleave was no longer binding on the current landowner.
[15] Encroachment, Ms Wilson submitted, is not necessarily unlawful; actionable encroachment is where there has been encroachment without there being a right to encroach. Here, by virtue of the voluntary wayleave granted by Houston, the defender had the right to install the Equipment and keep it installed on the Linwood Site. On change of ownership of the site, the Houston wayleave did not bind the new owner but that did not mean that it was no longer in force. In terms of paragraph 8 of schedule 4 to the 1989 Act it was temporarily continued, with all the consequent obligations on the licence holder (including the obligation to make payment) pending exercise by the new owner/occupier of the right conferred upon him by paragraph 8(2) to serve a notice to remove. That any right to sue for removal at common law is superseded by the statutory right did not appear to be disputed by the pursuer. Thus, a new owner or occupier such as the pursuer can either exercise his paragraph 8(2) right or he can do nothing; the statutory scheme supersedes the common law entirely and if the new owner or occupier does nothing then the licence holder need do nothing. In such a case, there being no obligation on the licence holder to do anything, equipment can remain on or over the land entirely lawfully. By stating that the new owner is not bound by a previous voluntary wayleave, paragraph 8(1)(c) is merely making clear that the new owner is empowered to exercise his statutory right to serve a notice to remove. Accordingly, Lord Glennie had been correct when in Patersons of Greenoakhill he had said that no delict is committed by a licence holder who maintains his equipment on land during the period between a change of ownership or occupation of that land and the grant of a necessary wayleave by the Scottish Ministers. It is not, however, a matter of the 1989 Act impliedly invoking the common law. Rather, Parliament has chosen to regulate the means by which the public can be assured of a continuous supply of electricity in a manner which avoids the licence holder being deemed to have acted unlawfully whenever, due to a change of ownership or occupation of which the licence holder may know nothing, the current owner or occupier is no longer bound by a previous voluntary wayleave. For the same reasons there can be no basis for a damages claim for the period after the notice to remove was served. Again, the approach of Lord Glennie in Patersons of Greenoakhill is correct. If the position were as the pursuer submits it is, the licence holder would be entirely uncertain as to its rights until a notice was served.
[16] In any event given the terms of the lease by the Pension Fund under which the pursuer held the Linwood Site between 1997 and 2006, the pursuer had no title to sue in respect of that period. The Equipment was in position when the pursuer took entry to the subjects which were defined as including the buildings erected thereon. Clause FIRST of the lease provided that the tenants accepted the subjects in their present condition as fit for purpose. During its period as tenant, the pursuer did not possess any part of the land or air space above it which was occupied by the Equipment, nor did it have any right to do so. The Pension Fund could not give the pursuer exclusive possession before first serving notice qua owner and even then not if a necessary wayleave was granted.
Pursuer’s second speech
[17] In reply to the suggestion that the licence holder was only able to take action on a change of ownership once the new owner had served a statutory notice, the Dean of Faculty pointed to the terms of paragraph 6(1)(a) which allowed the licence holder to apply for a necessary wayleave where “it is necessary or expedient…to install and keep installed an electric line”. While the wording was “install and keep installed” that was open to the construction “install or keep installed” which would mean that the licence holder would have a remedy in the case of a new owner simply sitting on his hands.
[18] The Dean saw the defender’s first fall-back position as reflecting a fall-back position for the pursuer. The pursuer’s preferred reading of paragraph 8 was that it was only when a notice to remove was served that the requirement to remove arose and, with it, the statutory immunity against removal conferred by paragraph 8(2). However if, properly construed, paragraph 8 provides that the service of a notice is effectively the precursor or necessary requirement for the continuing presence of the Equipment constituting an encroachment in that it brings to an end the pre-existing tolerance on the part of the land owner, then the pursuer would argue that with service of the notice to remove the pursuer became entitled to damages in respect of that encroachment.
[19] In the Dean’s submission what had been presented as a title to sue point came down to one of interpretation of the lease. On the pursuer’s interpretation of the lease there was conferred on the tenant a right of full and exclusive possession which was infringed by the defender’s encroachment on the Linwood Site.
Decision
[20] The pursuer sues for damages for encroachment by reason of the presence of the defender’s equipment on the Linwood site between 27 September 1997, when the pursuer entered into possession of the site, and 13 August 2014, when the Scottish Ministers granted a necessary wayleave in the defender’s favour. The period of 27 September 1997 to 13 August 2104 was punctuated by the pursuer serving notice of removal of the Equipment from the site on 8 December 2010. I shall refer to the period from 27 September 1997 to 8 December 2010 as the “pre-notice period” and the period between 8 December 2010 and 13 August 2104 as the “post-notice period”.
[21] Parties were at one as to the common law in respect of encroachment on heritable property. The owner of land has a right of exclusive and complete possession that he may transmit to his tenant for the term of a lease. Any permanent or quasi-permanent intrusion by something onto the land which in any way impinges on enjoyment of the right of exclusive possession, constitutes the delict of encroachment. The very fact of an encroachment is an injuria, meaning that “every encroachment, though it should not be guarded against by statute, founds the proprietor in an action of damages”: Erskine, Institute II.i.1, provided loss can be shown. In the event of encroachment a person in occupation of heritable property on a possessory or proprietary title has two distinct sorts of remedy at common law: (i) the possessory remedies of interdict to prevent the encroachment where it has not yet occurred and an order to remove the encroachment where it has occurred; and (ii) the remedy of damages directed to compensating any loss which the encroachment may have occasioned. Consent is a defence to a complaint of encroachment and therefore to an action seeking removal or to an action for damages, but consent is personal to the person granting it and accordingly, as a general rule, successors in title are not bound by the consent of a predecessor in title.
[22] It follows that, as a matter of common law, installing and keeping installed electric lines and associated equipment on the land of another is an encroachment and, in the absence of consent, actionable accordingly. However, as parties agreed, the common law position has been altered by the 1989 Act. The question is to what extent?
[23] I would accept Ms Wilson’s proposition that the 1989 Act sets out a statutory regime that regulates the respective rights and interests of landowners, occupiers and licence holders, all in the general interest of the public which requires an uninterrupted supply of electricity, but that is not the same as saying that there is no scope whatsoever for the operation of the common law in circumstances where a licence holder has installed an electric line and its associated apparatus. I would see the statutory regime as superimposed upon but not completely superseding the underlying common law. I agree with the Dean of Faculty that that is reflected by paragraph 8 (1)(c) of schedule 4 which recognises that on a change of ownership any wayleave entered into by the previous owner will not bind his successor and that therefore there will be no consent to keep the line installed; and by paragraph 8(2), which recognises that in the absence of specific statutory provision the licence holder would be obliged to remove equipment from land on being given notice to do so by an owner who is not bound by a wayleave. Thus, in circumstances exemplified in Bolton v Southern Electric plc [1999] EGLR 177, a case included on parties’ joint list of authorities, where a licence holder entered on land and there installed a generator, pole and line without any consent whatsoever, there would appear to be no reason in Scots law why the landowner who could show consequential loss should not be able to sue for damages in respect of encroachment.
[24] The factual circumstances of the present case are different from those in Bolton. Here the initial installation of the Equipment was consented to by the then landowner by virtue of the Houston wayleave. However, as parties were agreed, that consent was personal to Houston and therefore on change of ownership of the Linwood Site the continued presence of the Equipment was no longer consented to. The pursuer argues that from the point of change of ownership, the presence of the Equipment therefore amounted to an encroachment.
[25] There is much that is unsatisfactory in the result contended for by the pursuer. Where, as here, the landowner refuses to grant a wayleave and does nothing more, it involves imposing delictual liability on a licence holder which is doing no more than carrying out its statutory obligations by keeping in place equipment necessary for the continuing public supply of electricity. It is a liability that may arise without the knowledge of the licence holder and, at least in circumstances where the continued installation of an electrical line is necessary for “an efficient, co-ordinated and economical system of electricity distribution” (see 1989 Act section 9), it is a liability that the licence holder may be unable to avoid. What I mean by the latter point is that the 1989 Act favours a voluntary wayleave as the mechanism for obtaining consent to the installation of an electric line; it is only where a landowner fails to give a voluntary wayleave or seeks to impose objectionable terms and conditions, that it is open to a licence holder to apply to the Scottish Ministers for the grant of a necessary wayleave. However, a voluntary wayleave has the weakness when compared with a necessary wayleave that it does not bind successors in title and therefore on change of ownership consent to continuing installation of the line falls. On the pursuer’s approach, as soon as that occurs (and independent of whether the landowner has requested removal or made any other sort of complaint) the licence holder is guilty of encroachment and liable for damages. The only way that the licence holder can bring that situation to an end entirely at its own hand is to remove the line and (presumably) redirect it over another route. That may or may not be practicable, having regard to the licence holder’s duty to develop and maintain an efficient, co-ordinated and economical system of electrical distribution. In the event of removal not being practicable, if the pursuer’s interpretation of the applicable law is correct, a licence holder may find itself unavoidably guilty of delict. In his second speech the Dean of Faculty suggested, albeit tentatively, that that was not so. The Dean argued that if “and” in the phrase “necessary or expedient ...to install and keep installed” as it occurs in paragraph 6 (1) (a) is construed as including “or” then in the event that a voluntary wayleave is no longer binding because of a change in ownership, a licence holder can invoke the provisions of paragraph 6 to acquire a necessary wayleave. However, I do not see that as being the plain meaning of the text. When the statute intends to provide for the situation where a licence holder considers it necessary or expedient “to keep an electric line installed” these are exactly the words it uses, as appears from paragraph 6(2)(a).
[26] For the defender Ms Wilson argued that these unsatisfactory consequences do not arise if the 1989 Act is given its proper construction. A change in ownership may mean that an existing voluntary wayleave ceases to be binding on the person who is owner or occupier of the land but nevertheless, by virtue of paragraph 8, the wayleave is “temporarily” continued with the result that keeping the electric line in position is entirely lawful and therefore not an encroachment. On this reading, if the landowner wishes to bring this temporary state of affairs to an end, his remedy (and his only remedy) is to give notice in terms of paragraph 8 (2) requiring the licence holder to remove, thereby enabling the licence holder, if it so wishes, to avail itself of its remedy which is to apply to the Scottish Ministers for the grant of a necessary wayleave.
[27] I would see the results of the defender’s construction of paragraph 8 as rather better balanced and more coherent than that put forward by the pursuer; better balanced in the sense of giving appropriate weight to all the interests involved (including the public interest) and more coherent in the sense of connecting with the provisions for compulsory grant and compensation in paragraphs 6 and 7. It does not perhaps provide a perfect solution in that there remains the question of how a landowner is to be compensated for any restriction on his rights of possession during the period when there is no binding wayleave in place, but a consequence of that is to put the onus on the landowner to give notice under paragraph 8(2) if he is being prejudiced by the presence of an electric line. That there should be such an onus on the landowner seems fair in that he is best placed to know (a) whether he is bound by a pre-existing wayleave, (b) whether he is suffering damage by reason of the presence of the line, and (c) whether the imposition of conditions or the making of some other adjustment would mitigate that damage.
[28] Of course, simply because a construction appears attractive does not mean that it is correct. What must be determined is the intention of Parliament, as disclosed by the plain meaning of the words it has used, given their context.
[29] Here the issue between the parties is as to the effect of paragraph 8. The paragraph applies where there has been a wayleave giving consent to the installation and the keeping installed of an electric line (defined by section 64(1) of the Act as including associated apparatus) but, by reason of the occurrence of any one of three specified events, there is no longer a consent binding on the current landowner. As I understood Ms Wilson, she sought to distinguish what the statute provides as being the effect of a paragraph 8(1)(c) event (a change in ownership or occupation) from the effect of a paragraph 8(1)(a) event (expiration of a period specified in the wayleave) or a paragraph 8(1)(b) event (termination in accordance with a term contained in the wayleave). She drew attention to the words “ceases to be binding on the owner or occupier” where they occur in paragraph 8(1)(c) and contrasted them with “is determined” in paragraph 8(1)(a) and “is terminated” in paragraph 8(1)(b). Her suggestion was that the paragraph 8(1)(c) event did not bring the pre-existing wayleave to an end in quite the same way as a paragraph 8(1)(a) event or a paragraph 8(1)(b) event. I do not accept that such a distinction can be made. In my opinion the purpose of paragraph 8(1) is to identify comprehensively the various events whereby a landowner’s consent or deemed consent may become no longer effective. Paragraph 8(2) then goes on to provide what may happen next.
[30] The Dean of Faculty and Ms Wilson were agreed that paragraph 8(2) supersedes the common law at least to the extent of replacing the common law remedy of an order for removal with the statutory remedy of giving notice to remove to which the licence holder may respond by making an application to the Scottish Ministers for the grant of a necessary wayleave. The consequences of the licence holder doing so are then described in paragraphs 8(3), (4) and (5). Where the Dean and Ms Wilson part company is the extent to which these sub-paragraphs supersede the common law and, in particular, the common law remedy of damages. As the Dean has it, while the statute disapplies the common law removal remedy, it says nothing about the damages remedy. The common law as to damages should therefore be presumed to remain in force. Not so according to Ms Wilson; when one looks to the wording of the relevant provisions, if a landowner objects to the presence of an electric line as intrusive, statute has given him a remedy in terms of paragraph 8 and by necessary implication that is his only remedy.
[31] I agree with Ms Wilson. Paragraph 8 addresses the situation where there has been consent and by virtue of that consent an electric line has been lawfully installed and thereafter lawfully kept installed but that consent is no longer effective. The structure of the paragraph is to explain that and to provide the landowner with one course of action that he may choose to follow and then to explain the consequences of that course of action, depending upon the response of the licence holder and the Scottish Ministers. The consequences include provision for compensation in terms of paragraph 7. I accept that there can be said to be a lacuna in the absence of provision for compensation in respect of the interim period between the giving of notice and the Scottish Ministers’ decision (which may be to refuse to grant a necessary wayleave) but with that exception the intention of Parliament looks to have been to provide a comprehensive solution to the problem of a line having been installed by virtue of a consent which thereafter comes to an end or otherwise becomes ineffective.
[32] This is to look at paragraph 8 from the perspective of remedy. There is also the perspective of wrong. The pursuer sues in respect of the delict of encroachment. Encroachment is constituted by the presence of something which intrudes upon and prejudices the landowner’s enjoyment of his land without entitlement to do so. Given the terms of paragraph 8(2) it is difficult to see how, in a situation to which paragraph 8 applies, it can be said that maintaining a line in position is wrongful. I would see the position to be clear where the landowner has given notice to remove. Doing so triggers the process which is set out in paragraph 8(2) and the succeeding sub-paragraphs. Depending upon how that process plays out, the point may come where the licence holder is required by the statute to remove. Should it fail to do so there may then be scope for an action for damages but until then, paragraph 8(2) expressly provides that “the licence holder shall not be obliged to comply with [the notice to remove]”. The pursuer sues for damages in respect of the post-notice period. Its construction of paragraph 8 therefore requires the presence of an electric line to be held to be wrongful in circumstances not only where it may be necessary for the maintenance of the public electricity supply but where statute expressly permits the line to continue to be installed. I consider that construction to be untenable. I respectfully agree with Lord Glennie in Patersons of Greenoakhill when he said at 119L: “No delict is committed by the defender continuing to maintain the lines during the period in question.” “[The] period in question” in Patersons of Greenoakhill, like the post-notice period in the present case, was after the landowner had given notice to remove and the licence holder had made an application to the Scottish Ministers for a necessary wayleave but if no delict is committed by a licence holder which maintains an electric line in position after being given notice to remove it (provided it responds to the notice by applying to the Scottish Ministers) can it be said that a delict is committed where no notice has been given? It would seem curious if the answer were yes. That would mean that for as long as the landowner did not ask for a line to be removed its presence would be unlawful, whereas as soon as he did ask for it to be removed its presence would become lawful. I doubt if that was the intention of Parliament.
[33] I agree that its cross-heading assists in construing paragraph 8. The cross-heading is “Temporary continuation of wayleaves”. That is consistent with a construction of paragraph 8(2) as meaning that despite an event having occurred which results in there being no longer consent by virtue of either a pre-existing voluntary or a necessary wayleave, consent is continued by statute “temporarily”, in other words until the occurrence of one of the further events which either result in the licence holder being obliged to remove the line or its continued installation being consented to by virtue of the grant of a new necessary wayleave. I would see it as just as appropriate to describe the effect of paragraph 8 as the temporary continuation of a wayleave where a notice to remove has not yet been given as where it has been given but the Scottish Ministers have not yet decided on an application for a necessary wayleave.
[34] When effect is given to what I consider to be the proper construction of paragraph 8, the pursuer’s claim, relying as it does on the proposition that on a pre-existing wayleave ceasing to be binding on a change of ownership the presence of an electric line on land becomes an encroachment and as such actionable in damages, is irrelevant, both in respect of the pre-notice period and the post-notice period. The action will therefore be dismissed.
[35] Given my view on the effect of the statute it is unnecessary to consider the defender’s third line of argument (the second fall-back position) that the claim in respect of the period when the pursuer was tenant under the lease is in any event irrelevant. Had I required to consider this argument I would have rejected it. The pursuer’s averments sufficiently instruct its title to sue. I read the lease as conferring the right of full possession of the Linwood Site. In the event of that being encroached upon the tenant has title to sue.
[36] I will reserve all questions of expenses.