(FIRST) THOMAS CHALMERS AND (SECOND) GAIL CHALMERS AGAINST DIAGEO SCOTLAND LIMITED
OUTER HOUSE, COURT OF SESSION
[2017] CSOH 36
A95/14
OPINION OF LORD ERICHT
In the cause
(FIRST) THOMAS CHALMERS and (SECOND) GAIL CHALMERS
Pursuers
against
DIAGEO SCOTLAND LIMITED
Defenders
Pursuers: Moynihan QC, Lamont; Balfour + Manson LLP
Defenders: Connal QC; Pinsent Masons LLP
3 March 2017
[1] As whisky matures in casks, ethanol evaporates from the casks. This is commonly referred to as “The Angels’ Share”. The defenders mature whisky in bonded warehouses close to the pursuers’ house. The pursuers have brought an action for damages against the defenders for damage to the pursuers’ house and outdoor property. They aver that the defenders’ release of ethanol vapour from their bonded warehouses amounts to a nuisance and has caused damage to their house and outdoor property. The action is for damages alone and not for interdict.
[2] The cause called before me on the procedural roll.
Defenders’ Submissions
[3] Mr Connal submitted that the defenders’ first plea‑in‑law should be sustained and the action dismissed. He did so under five broad headings, while acknowledging that there was a certain duplication in respect of what was said. The headings were as follows:
Fair Notice
[4] Mr Connal submitted that the facts had not been averred in sufficient detail to enable any allegation to be investigated and thereafter explored if necessary approval. The claim was of an unprecedented nature with the potential to have radical impacts on a major industry and depended on fields of science where work to reach a supportable conclusion may take months or more likely years and it was accordingly all the more essential that they provided fair notice. A proof before answer would not be an appropriate solution.
Law of Nuisance
[5] Mr Connal submitted that the pursuers’ case failed to set out an argument for the existence of culpa. The defenders were carrying on a long established operation in accordance with all requisite permits issued in the public interest by public authorities and many of the pursuers’ assertions had been rejected by an independent public body in the relatively recent past. He further submitted that:
(a) the pursuers failed to set out an adequate case that, in the locality in which their property stood, the threshold laid down by the law had been breached; the defenders’ business was longstanding and the pursuers’ properties were incomers;
(b) in any event the pursuers failed to set out a relevant and specific case to meet the fundamental legal requirement that any alleged impact must be “plus quam tolerabile”;
(c) regulation by expert public authorities, acting in the public interest, would be undermined by an uncontrollable series of individual claims seeking to set individual standards. The public permitting regime specifically requires the emission of ethanol from the warehouse, and regulation balances the interest of producers the public and individuals. The defenders’ use was permitted and was positively required for the production of whisky;
(d) As the defenders had been performing the same process on site for more than 20 years the defenders had acquired a right to emit ethanol and the emission could not constitute a nuisance. Separatim, the duration of user was an important factor in the locality issue referred to above.
Loss
[6] Mr Connal submitted that there was no specification of when or over what period the alleged damage occurred. Separatim, it appeared likely that it occurred more than five years before the commencement of the present proceedings. The averments lacked specification and prima facie gave rise to an interference that the claims have prescribed.
Specific Lack of Fair Notice
[7] He submitted that there was lack of specification in relation to the following particular matters.
(a) The pursuers’ averment in Article 2 that it is not an essential part of the process that ethanol is permitted to escape the premises.
(b) The pursuers’ averments in Article 3 use a series of phrases purportedly supportive of a scientific proposition without being prepared to specify what the phrases relied upon mean.
(c) The pursuers’ averments in Article 4 provide no detail to explain the critical assertion that the black fungus is Baudoinia compniacensis, do not specify the basis of the words “elevated” and “rare” and have not dealt with the matters raised in various calls.
(d) The averments in Article 5 seek to criticise the report in ways which are irrelevant, lack detail and fail to address the question of whether the existence of the report provided a complete answer to any claim of culpa, and were lacking in candour.
(e) The pursuers’ averments in Article 6 were lacking in specification and failed to provide details of the claim.
Pursuers’ Submissions
[8] Mr Moynihan submitted that the pursuers case was very simple. The defenders’ bonded warehouse emits ethanol at a level which germinates the fungus Baudoinia compniacensis which covers the pursuers’ property in an unsightly black coating. The fact that the black coating is attributable to ethanol emitted by such warehouses has been known to the defenders for some time. These circumstances amount, in law, to a nuisance and the pursuer is entitled to compensation for the damage to his property. The factual issues raised in the defenders’ pleadings and Note of Argument could only be properly addressed at proof before answer.
Pleadings
[9] The pursuers pled as follows:
“COND.2. The defenders own and operate a whisky aging facility in Bonnybridge, Falkirk. The premises include nine bonded warehouses. Whisky is matured in casks within the warehouses. As the whisky matures, ethanol evaporates from the casks into the surrounding atmosphere (commonly referred to as “the angel’s share”). Ethanol evaporates from the casks at the rate of approximately 2% by volume per year. With reference to the defenders’ averments in answer, admitted that during the maturation of whisky, and as an essential part of that maturation process, air enters the casks and ethanol and other substances leave them, under explanation that it is not an essential part of the process that the ethanol is permitted to escape the premises and to damage neighbouring properties.
…
COND.3. Ethanol vapour in relatively high humidity strongly stimulates the germination, growth and development of a fungus known as Baudoinia compniacensis. Elevated ambient ethanol vapour in addition to high relative humidity are prerequisites to establishment of colonies of this fungus.
…
COND.4. The bonded warehouses are adjacent to the Woodlea Park development. The pursuers’ house lies approximately 350 metres east north east of the bonded warehouses. The predominant wind is towards east north east. Accordingly, the pursuers’ property lies directly downwind from the warehouses in the prevailing wind. Ethanol vapour is released from the bonded warehouses and is carried by the prevailing wind onto the pursuers’ property. This has caused the exterior of the pursuers’ house and some of their moveable property, including a car, to be discoloured by an unsightly black fungus. The black fungus is Baudoinia compniacensis. With reference to the defender’s averments in answer, admitted that the premises operated in this location prior to the building of the Woodlea Park development. Quoad ultra denied. Explained and averred that the levels of ethanol in the vicinity of the pursuers’ house are elevated. They are between 5 and 11 parts per million (ppm). The ambient background readings in a rural location near Kilsyth are between 1 and 2 ppm. It would be extremely rare to get ambient levels of 3 or 4 ppm. The expected levels are 1 or 2 ppm.
COND.5. The defender’s release of ethanol vapour from their bonded warehouses amounts to a nuisance. The nuisance is caused by the defenders’ fault. The presence of black fungus on the houses throughout the Woodlea Park development is obvious. Black fungus has been associated with bonded warehouses across Scotland for a considerable number of decades. Scientific literature has discussed bonded warehouses and their link to the development of extensive dark stains on exterior surfaces. These have been shown to extend to a variety of surrounding buildings, vegetation and other structures. The staining has been reported to extend downwind following the direction of the prevailing wind. Friend [1965] reported the growth of fungus on trees and leaves, as well as other surfaces. Watson et al [1984] hypothesised that alcohol evaporating during the maturation process (that is, alcohol being stored in wooden barrels for at least three years), could provide a carbon source to fungi in the environment. Similar situations have been identified in the vicinity of bourbon, brandy and sherry maturation warehouses. Sweeney [1988] considered that the evaporation of alcohol from bonded warehouses used for the storage of whisky provided a source of nutrients (when considering the presence of black fungus in the majority of Scottish District Councils). In 2001 Sporometrics Inc was hired by Hiram Walker & Sons Distillery in Ontario, Canada, to investigate discolouration of property in the vicinity of bonded warehouses in Lakeshore, Ontario. That investigation resulted in 2007 in the identification of a new genus and species Baudoinia compniacensis (known as “the warehouse staining fungus”) as the cause of the discolouration. The results and subsequent biological investigations were widely reported. Reference is made, for example, to the article by James A Scott and others entitled “Baudoinia, a new genus to accommodate Torula compniacensis” published in Mycologia, volume 99(4): 592‑601 (2007). Grigoriev [2011] suggested that Baudoinia compniacensis is worldwide in its distribution and reported from most geographic localities where spirits are manufactured and aged. In the circumstances, the defenders knew or ought to have known that the release of ethanol vapour from their property would be liable to cause loss and damage of the type which did, in fact, occur. The ethanol vapour caused the loss and damage hereinafter condescended upon. Had the defenders not caused ethanol vapour to be released the damage would not have occurred. With reference to the defenders’ averments in answer, admitted that Sporometrics Inc is a company operated by James A Scott and others. Admitted that Health Protection Scotland investigated blackening in the Bonnybridge area in 206 under reference to the following explanation. Quoad ultra denied. With reference to the Health Protection Scotland Investigation, explained and averred that that the authors of that report were not considering the possibility of Baudoinia compniacensis and did not adopt techniques likely to identify that fungus as the case of the black fungus. That investigation was carried out before the identification of Baudoinia compniacensis in modern science and using scientific methods unsuited to the identification of this fungus. This species had been accurately described by Richon & Petit in 1881 under the name Torula compniacensis but had dropped from scientific awareness until the work of Dr Scott and others publicised in 2007. The Health Protection Scotland team used a medium (Sabouraud agar) and an incubation temperature (28°C) appropriate to growing disease causing fungi and unsuited to many common environmental moulds such as Baudoinia compniacensis. They failed to carry out an exacting microscopic comparison of the culture results and the structures present in the scrapings. Given the shortcomings of that investigation the defenders were afforded an opportunity to participate in the sampling carried out on behalf of the pursuers for the purposes of the present action. The parties agreed jointly to take samples of the black fungus. Samples were taken on 12th February 2013 by Dr Summerbell of Sporometrics in the presence of a representative of the defenders’ solicitors and a mycologist instructed by the defenders. The defenders were provided with half of each sample for testing by them. They have not advised the pursuer of their results. Esto the defenders deny that the black fungus is Baudoinia compniacensis they are called upon to specify the genus of the microflora that they allege to be responsible for the staining to the houses in the development. They are further called upon to specify the ‘legal requirements’ for the ‘process’ to which they refer. Their failure to answer these calls will be founded upon.
Discussion
[10] Both parties acknowledged that there was a degree of overlap between the various arguments made before me. I propose to look first at matters relating to liability, dealing with matters of law and then with specification points. I shall then deal with quantum.
Liability
Private Law Nuisance
[11] It is clear from the case law that the essential basis for liability and reparation from nuisance is culpa (RHM Bakeries (Scotland) Limited v Strathclyde Regional Council 1985 SC (HL) 17; Kennedy v Glenbelle Ltd 1996 SC 95; I was also referred to Chalmers v Dixon (1876) 3 R 461, Ogston v Aberdeen District Tramways Company (1896) 24 R (HL) 8, Noble’s Trustees v Economic Forestry (Scotland) Limited 1988 SLT 662, Argyll & Clyde Health Board v Strathclyde Regional Council 1988 SLT 381, Borders Regional Council v Roxburgh District Council 1989 SLT 837, Logan v Wang (UK) Ltd 1991 SLT 580 and Esso Petroleum Company v The Scottish Ministers [2016] CSOH 15). The issue for me is whether a sufficient case of culpa has been pled to allow this case to go to proof before answer. What is required is that the pursuers plead a deliberate act or negligence or some other conduct from which culpa or fault may be inferred (Kennedy v Glenbelle per Lord President Hope at p 101A). It is clear from the authorities that very little may be needed by way of pleading to support an assertion of fault (RHM Bakeries (Scotland) Limited v Strathclyde Regional Council at p219; Logan v Wang UK Ltd at p 584J).
[12] The pursuers plead in Article 5:
“ The defenders’ release of ethanol vapour from their bonded warehouses amounts to a nuisance. The nuisance is caused by the defenders’ fault”
The pursuers then aver details of why they say the vapour causes damage and why the fungus is present. They list the scientific papers on which their case is based and set out briefly the findings of these papers. They go on to aver:
“In the circumstances, the defenders knew or ought to have known that the release of ethanol vapour from their property would be liable to cause loss and damage of the type which did, in fact, occur. The ethanol vapour caused the loss and damage hereinafter condescended upon. Had the defenders not caused ethanol vapour to be released the damage would not have occurred.
In my opinion these averments satisfy the requirement set out by Lord President Hope and are sufficient to allow the case to go to proof before answer so far as culpa is concerned.
[13] Culpa of itself is not sufficient to give rise to liability in nuisance.
“A claim for damages in nuisance is a delictual claim…It arises where there is an invasion of the pursuer’s interest in land to an extent which exceeds what is reasonably tolerable. The plus quam tolerabile test is peculiar to the liability in damages for nuisance. Where that test is satisfied and culpa is established, the requirements for the delictual liability are fulfilled” (Kennedy v Glenbelle per Lord President Hope at p 99B-C)
[14] Mr Connal argued that the activity must be intolerable to a material extent (Wilson v Gibb and Brattesani (1903) 10 SLT 293, Maguire v Charles McNeil Limited 1922 SC 174, Watt v Jamieson 1954 SC 56, Central Motors (St Andrews) Ltd v Magistrates of St Andrews 1961 SLT 290), and that the pleadings did not specify such materiality. In my view, the issue of whether something exceeds what is reasonably tolerable is by its very nature dependent on the facts and circumstances and should be decided after enquiry. There is sufficient specification of damage to allow enquiry as to whether this was plus quam tolerabile.
[15] Mr Connal also argued that nuisance is governed by criteria dependent on locality and in the current case the pursuers were required by law to accept the consequence of living in a mixed area, close to pre-existing industrial processes: the pursuers had not taken the mixed use into account and therefore had not pled a relevant case on locality.
[16] The Scottish case law shows that the nature of the locality is an important feature in determining whether an activity constitutes nuisance (see eg Maguire v Charles McNeil Limited, Watt v Jamieson, Central Motors (St Andrews) Ltd v Magistrates of St Andrews). The nature of the locality goes to the question of whether the use was plus quam tolerabile. In my view the issue of the nature of the locality is one which is best dealt with after proof of facts and circumstances relating to the locality. Only after that is the court in a position to consider the alleged nuisance in its proper context.
[17] A further issue arises out of the defenders’ approach to locality. The defenders sought to criticise the pursuers’ pleadings for not taking into account pre-existing industrial uses, including the defenders’ use. That approach raises the question of how the assessment of the nature of the locality should be made. Should the assessment be made on the basis of what the locality is like with the alleged nuisance taking place or without the alleged nuisance? In Coventry v Lawrence ([2014] AC 822 sub nomine Lawrence v Fen Tigers Ltd) Lord Neuberger, in considering the English law of nuisance, approached the matter in this way:
“In my view, to the extent that those activities are a nuisance to the claimant, they should be left out of account when assessing the character of the locality, or to put it in another way, they should be notionally stripped out of the locality when assessing its character”(para [65])
He acknowledged a difficulty with this approach:
“It must be acknowledged, however, that there appears to be an element of circularity in the notion that, when assessing the character of a locality, one has to ignore the defendant’s activities if, or to the extent that, they constitute a nuisance, given that the point one is ultimately seeking to decide is whether the defendant’s activities amount to a nuisance” (para [71])
Lord Carnwath took a different view:
“An existing activity can in my view clearly be taken into account if it is part of the established pattern of use” (para [187])
[18] Nothing that was said in Coventry v Lawrence makes me alter my view that the issue of locality is best decided after proof before answer. Indeed, even on Lord Neuberger’s approach it is necessary to establish the facts before coming to a decision. He states at paragraph [71]:
“In many cases, it is fairly clear whether or not a defendant’s activities constitute a nuisance once one has established the facts, and nice questions as to the precise identification of the locality or its character do not have to be addressed”
[19] Accordingly, the appropriate time to consider the question of the nature of the locality, and to discuss whether either of Lord Neuberger or Lord Carnwath should be followed in Scotland on this matter, is at proof before answer.
The Relationship Between the Private Law of Nuisance and Regulatory Law
[20] This case raises the issue of the relationship between private law of nuisance exercisable by neighbouring landowners in respect of their private interest, and public regulatory law regulating the use of land on behalf of the community as a whole. Mr Connal argued that many of the assertions made by the pursuers had been investigated and rejected by a public body, Health Protection Scotland, in 2006. He further argued that the defenders complied with regulatory requirements in terms of planning, building, health and safety, whisky production, and products of geographical indication recognised by the World Trade Organisation, and emphasised the importance of whisky production to the Scottish economy. He submitted that the Scottish cases did not assist. He urged me to follow Lord Carnwath who stated in Coventry v Lawrence at paragraph 183:
“After more than 60 years of modern planning and environmental controls, it is not unreasonable to start from the presumption that the established pattern of uses generally represents society’s view of the appropriate balance of uses in a particular area, taking account both of the social needs of the area and of the maintenance of an acceptable environment for its occupants. The common law of nuisance is there to provide a residual control to ensure that new or intensified activities do not lead to conditions which, within that pattern, go beyond what a normal person should be expected to put up with”
[21] However, Lord Carnwath’s view was not that of the majority. Lord Clarke supported Lord Carnwath to this extent:
“I agree that the fact that planning permission has been granted is capable of being relevant to an action of nuisance in a number of respects but, as Lord Carnwath JSC has shown, the facts of such cases are so varied that it is difficult to lay down hard and fast rules. As so often, it all depends on the circumstances. However, I agree with Lord Neuberger PSC, Lord Sumption and Lord Carnwath JJSC that the existence of planning permission for the activity complained of may well be of particular relevance to the remedy to be granted”
[22] The majority of the Supreme Court took a different view as to the significance of regulatory law on the question of liability for private nuisance. Lord Neuberger at paragraph [92] approved a passage by Lord Carnwath sitting in the Court of Appeal in a previous case as follows:
“In my view therefore Carnwath LJ was right when he said in Barr v Biffa Waste Services Ltd [2013]QB 455 para 46(ii) that:
‘The common law of nuisance has co-existed with statutory controls, albeit less sophisticated, since the 19th century. There is no principle that the common law should “march with” a statutory scheme covering similar subject matter. Short of express or implied statutory authority to conduct a nuisance…there is no basis in principle or authority, for using such a statutory scheme to cut down private rights’”
Lord Neuberger went on to conclude at paragraph [94]:
“I consider that the mere fact that an activity which is said to give rise to the nuisance has the benefit of a planning permission is normally of no assistance to the defendant in a claim brought by a neighbour who contends that the activity causes a nuisance to her land in the form of noise or other loss of amenity”
[23] That was said in the context of liability. Lord Neuberger did however see planning permission as being relevant to remedy, stating at paragraph [125]:
“In some cases, the grant of planning application for a particular activity…may provide strong support for the contention that the activity is of benefit to the public, which would be relevant to the question of whether or not to grant an injunction. Accordingly, the existence of a planning permission which expressly or inherently authorises carrying on an activity in such a way as to cause nuisance by noise or the like, can be a factor in favour of refusing an injunction and compensating the claimant in damages. This factor would have real force in cases where it was clear that the planning authority had been reasonably and fairly influenced by the public benefit of the activity, and where the activity cannot be carried out without causing the nuisance complained of. However, even in such cases, the court would have to weigh up all the competing factors”
[24] Lord Sumption agreed with Lord Neuberger and added:
“155. It is, I think, worth pointing out that the question what impact the grant of planning permission should have on liability in tort for private nuisance and the question what remedies should be available for a nuisance are closely related. They both raise a broader issue of legal policy of some importance, namely how is one to reconcile public and private law in the domain of land use where they occupy much the same space?
156. I agree with Lord Neuberger that the existence of planning permission for a given use is of very limited relevance to the question whether that use constitutes a private nuisance. It may at best provide some evidence of the reasonableness of the particular use of land in question. But planning authorities are concerned with the public interest in development and land use, as that interest is defined in the planning legislation and any relevant development plans and policies. Planning powers do not exist to enforce or override private rights in respect of land use, whether arising from restrictive covenants, contracts, or the law of tort. Likewise, the question whether a neighbouring landowner has a right of action in nuisance in respect of some use of land has to be decided by the courts regardless of any public interest engaged.
157. What saves, or could save the law from anomaly and incoherence is the court's discretion as to remedies. An injunction is a remedy with significant side-effects beyond the parties and the issues in the proceedings. Most uses of land said to be objectionable cannot be restrained by injunction simply as between the owner of that land and his neighbour If the use of a site for (say) motocross is restrained by injunction, that prevents the activity as between the defendant and the whole world. Yet it may be a use which is in the interest of very many other people who derive enjoyment or economic benefits from it of precisely the kind with which the planning system is concerned. An injunction prohibiting the activity entirely will operate in practice in exactly the same way as a refusal of planning permission, but without regard to the factors which a planning authority would be bound to take into account. The obvious solution to this problem is to allow the activity to continue but to compensate the claimant financially for the loss of amenity and the diminished value of his property. In a case where planning permission has actually been granted for the use in question, there are particularly strong reasons for adopting this solution. It is what the law normally provides for when a public interest conflicts with a proprietary right.”
[25] The discussion about remedies in the Coventry case may be of little relevance to the position in Scotland, as that discussion was in the context of rationalising difficulties in English case law relating to when an English court may award damages instead of an injunction. Having said that, in the current case the pursuers do not seek interdict but seek only damages, and there is no doubt that damages for nuisance can be awarded by the Scottish courts (see eg Kennedy v Glenbelle).
[26] Even if I were to take Mr Connal’s submission at its highest and accept that the dicta of Lord Neuberger and Lord Carnwath on which he founds represent Scots law on the matter, then they still point to a proof before answer. Lord Clarke states that it all depends on the circumstances, and therefore in my view it is essential that the circumstances are fully established before a decision is reached. This is particularly so in the present case where although the regulatory decisions founded on by Mr Connal were referred to in general terms they were not put before me in detail. Accordingly I am not in a position to assess whether or not they are of significance and if so to what extent. Indeed, Mr Connal’s submission went further than Coventry v Lawrence (which related to planning regulation) and covered various other regulatory regimes: a full understanding of these regimes and their significance would be required before a decision could be taken on whether any of the dicta in Coventry v Lawrence should be extended to these regimes also. In any event, on the pleadings there is a stark dispute as to whether the 2006 Health Protection Scotland findings are of any significance as that report did not consider the particular fungus upon which the pursuers’ case is based (Baudoinia compniacensis): that dispute can only be decided after proof.
[27] Accordingly, in my opinion, enquiry into the facts is required before the court can make any decision on whether, in the circumstances of this case, regulatory decisions can, and have, cut down any private law right to damages for nuisance.
Coming to the Nuisance
[28] Mr Connal submitted that the pursuers had failed to aver a relevant case of nuisance in the particular locality because the pursuers were incomers. In answer 4 the defenders made averments to the effect that the warehouses operated prior to the building of the pursuers’ house, with the warehouses becoming operational in 1979 and the housing estate not being constructed until around 2002, prior to which the land was undeveloped. Mr Moynihan submitted that the question was at what point does nuisance occur, that is when did the activity cross the threshold to become plus quam tolerabile, which required a proof before answer.
[29] In Scots law, there is no defence of “coming to the nuisance”. As Lord Halsbury said in the Scottish House of Lords case of Fleming v Hislop (1886) LR 11 App Cas 686 at p 697:
“If the Lord Justice Clerk means to convey that there was anything in the law which diminished the right of a man to complain of a nuisance because the nuisance existed before he went to it, I venture to think that neither in the law of England nor in that of Scotland is there any foundation for any such contention. It is clear that whether the man went to the nuisance or the nuisance came to the man, the rights are the same.”
[30] The issue of whether an alteration in the claimant’s property after the activity has started can give rise to a claim in nuisance if the activity would not have been a nuisance had the activity not occurred, is an issue which has troubled the English courts. The English authorities were considered and analysed by Lord Neuberger in Coventry v Lawrence. Lord Neuberger came to a conclusion which although obiter is a useful analysis of where English law may be heading on this point:
“[56] where a claimant builds on, or changes the use of, her land, I would suggest that it may well be wrong to hold that a defendant’s pre-existing activity gives rise to a nuisance provided that (i) it can only be said to be a nuisance because it affects the senses of those on the claimant’s land, (ii) it was not a nuisance before the building or change of use of the claimant’s land, (iii) it is and has been a reasonable and otherwise lawful use of the defendant’s land, (iv) it is carried out in a reasonable way, and (v) it causes no greater nuisance than when they claimant first carried out the building or changed the use……
58. Accordingly it appears to me that it is no defence for a defendant who is sued in nuisance to contend that the claimant came to a nuisance, although it may be a defence, at least in some circumstances, for a defendant to contend that , as it is only because the claimant has changed the use of, or built upon, her land that the defendant’s pre-existing activity is claimed to have become a nuisance, the claim should fail”
[31] In my view the appropriate time for any discussion as to whether the defence which Lord Neuberger suggests may exist in England exists or not in Scotland is after proof before answer. That suggested defence depends on the circumstances of the case. These circumstances include the nature of the emission: Lord Neuberger specifically refers to a nuisance which affects the senses, whereas in this case the pursuers aver damage to property. It is appropriate for the factual circumstances to have been established before coming to a decision on any legal argument on the suggested defence.
Prescription
[32] In arguing that the pursuers’ case was irrelevant because of prescription, Mr Connal touched on the issue set out in his fifth plea in law:
“The defenders having acquired a right to emit ethanol over the surrounding area by operation of prescription should be assoilzied”
Taken at face value, the wording of that plea in law might suggest that the defenders’ argument was that the defender had established by positive prescription a right to emit ethanol. In English law, it would appear that it is possible to acquire a positive right to commit a nuisance by operation of prescription. In Coventry v Lawrence the Supreme Court held that it was possible for the owner of land to acquire by prescription an easement to carry on an activity which resulted in noise which would otherwise cause an actionable nuisance, provided that such noise nuisance had been emitted for 20 years. At the hearing before me, no argument was advanced on behalf of the defenders that a similar position applied in Scotland in relation to emission of ethanol. It is difficult to see how any such argument would have had any prospect of success given that a right to emit ethanol would not fit easily within the list of servitudes recognised by Scots law.
[33] Instead, it was argued for the defenders, on the basis of Harvie v Robertson (1903) 5 F 338, that the right to emit, having been exercised for more than 20 years, was not open to challenge. Mr Connal submitted that it was not necessary to determine the theoretical distinctions between section 7 and section 8 of the Prescription and Limitation (Scotland) Act 1973, but the current case was more like a section 8 case. He emphasised that he was not arguing the 5 year prescription, stating that we don’t know when the losses occurred nor the precise nature of the scientific effect of ethanol (does it germinate ie single act or does it continuously impact). He referred to Central Motors (St Andrews) Limited v Magistrates of St Andrews, the opinion of the Lord Ordinary in Webster v Lord Advocate 1985 SC 173, Stair Memorial Encyclopaedia, Nuisance, Reissue, Niall R Whitty MA, LLB, August 2001 at paragraph 124 and Prescription and Limitation, Second Edition, 2012, David Johnston, paragraphs 7.09-7.14.
[34] Mr Moynihan argued that it was section 7 and not section 8 which applied. The issue was not the right to emit (ie pollute), but the right to object. The correlative of a right to emit was an obligation to abate, enforceable by interdict, whereas the correlative of a right to object was an obligation to pay damages. Under section 7(1) prescription starts to run from the date when the obligation has become enforceable. Under section 8 prescription starts to run when the right becomes “exercisable or enforceable”. So whichever section applies it is necessary to establish when the nuisance was constituted. This required enquiry into the facts and so the court should not decide the legal issues until after proof before answer.
[35] In Harvie v Robertson the pursuer erected a tenement of dwelling houses then sought to interdict the proprietor of adjoining ground from carrying on lime-burning in respect that lime-burning was a nuisance, and that the inhabitants of the dwelling houses suffered from noxious fumes arising from it. The lime-burning had been carried on for more than 40 years, during most of which time the pursuer and his predecessors in title had used their land for industrial purposes and had not been injuriously affected by the lime-burning. The court held that the pursuer not having complained for the prescriptive period the defender could not now be interdicted. The court did not find it necessary to decide whether this was in respect of positive prescription, whereby the right to continue a legal wrong was acquired, or in respect of negative prescription cutting of the right to object, but an obiter view was expressed that it was the latter (Lord President at p343).
[36] The Lord President stated at page 342:
“I concur with the Lord Ordinary in thinking that, assuming that there has all along been a nuisance, the third plea in law for the defender should be sustained, viz “Separatim, the defender having a prescriptive right to carry on the business of lime-burning on the ground in question, is entitled to be assoilzied” It is established by the evidence that for a period materially exceeding forty years prior to the raising of this action, the burning of lime had been carried on at the place where it is now carried on by the defender, and it does not appear that it was ever challenged or objected to. Further, it is not proved that, if the burning of lime at the place in question caused a nuisance, there has been any increase in the nuisance within the last forty years. In this state of evidence the right of the defender to burn lime at the place in question is, in my judgment, established, and any right which the pursuer might otherwise have had to object to it is cut off” (emphasis added)
[37] Lord Adam stated at page 343-4:
“The pursuer says that he had no title to complain unless he had suffered actual damage, and he says that he only suffered actual damage three or four years ago, when he chose to alter the mode in which he occupied his ground. He then removed the oil-works and built a tenement of houses. It was only, he says, when the tenement was built and began to be occupied by the tenants that the injurious effects of these noxious gases were felt.
Now, I do not think the pursuer's plea on that point is well founded. I do not think the question at all depends upon how the pursuer chose to occupy his property from time to time. I think the real question is whether the prœdium possessed by the pursuer would be injured, and was injured, by noxious fumes, constituting a nuisance, being discharged over his ground. It humbly appears to me that anyone who has a stream of noxious gas discharged over his ground has right to complain of it at any time when it is done, because such a nuisance, if committed, would depreciate the actual value of his property. I think that the proprietor of any ground over which a nuisance of this sort is created has a perfect right, and therefore a perfect title, to complain at once of such a nuisance being created.” (emphasis added)
[38] Lord Kinnear stated at page 345:
“ the principle is simply this, there can be no acquisition of a right by prescriptive user to occupy property in such a way as to injure a neighbour unless during the period of user the neighbour has a right of action to prevent such injury. That seems to me to be perfectly clear. The right of action must begin when the nuisance begins, and the prescriptive user cannot begin at any earlier period. So long as what is done hurts nobody there is no nuisance, and there is no right of action to put a stop to operations which are ex hypothesi harmless. ….
I agree entirely in what was said by Lord Adam that the question whether a proprietor complaining of such injury has a title and interest to interfere does not depend exclusively upon present injury to his land. He is entitled to take into account not only the actual inconvenience and discomfort caused to people living on the ground by noxious fumes, but also the injury to the value of the property and the prospect of using it for advantageous purposes, other than those to which it is actually applied at the moment. It is enough that the enjoyment of property is interfered with by conduct which, if persisted in, will tend to create an adverse right….” (emphasis added)
[39] I note that the decision of the court in Harvie v Robertson was made after proof. I note also the considerable emphasis in the opinions in that case on the evidence and the facts. In my opinion, it is clear from these passages that the right to complain does not arise until the nuisance arises. The date when the nuisance has arisen is a matter of facts and circumstances. Thus in Harvie the nuisance arose when the noxious gases depreciated the value of the pursuer’s property and injured the prospect of it being used for alternative purposes such as building dwelling houses. Accordingly, the appropriate time to decide whether prescription has operated is after enquiry into the facts. This is particularly so in cases such as the present one where, as I have already said, in order to establish whether nuisance has arisen it is necessary for enquiry to be made into whether the activities are plus quam tolerabile.
[40] Since the date of Harvie, Scots law on prescription has been put on a statutory basis in the Prescription and Limitation (Scotland) Act 1973.
Section 7 provides:
“Extinction of obligations by prescriptive periods of twenty years.
(1)If, after the date when any obligation to which this section applies has become enforceable, the obligation has subsisted for a continuous period of twenty years—
(a) without any relevant claim having been made in relation to the obligation, and
(b) without the subsistence of the obligation having been relevantly acknowledged,
then as from the expiration of that period the obligation shall be extinguished:
….
(2) This section applies to an obligation of any kind (including an obligation to which section 6 of this Act applies), not being an obligation to which section 22A of this Act applies or an obligation specified in Schedule 3 to this Act as an imprescriptible obligation or an obligation to make reparation in respect of personal injuries within the meaning of Part II of this Act or in respect of the death of any person as a result of such injuries.”
Section 8 provides:
“Extinction of other rights relating to property by prescriptive periods of twenty years.
- If, after the date when any right to which this section applies has become exercisable or enforceable, the right has subsisted for a continuous period of twenty years unexercised or unenforced, and without any relevant claim in relation to it having been made, then as from the expiration of that period the right shall be extinguished.
- This section applies to any right relating to property, whether heritable or moveable, not being a right specified in Schedule 3 to this Act as an imprescriptible right or falling within section 6 or 7 of this Act as being a right correlative to an obligation to which either of those sections applies.”
[41] The issue of whether section 7 or section 8 is applicable to the current circumstances is a difficult one and academic commentary from Professor Whitty and Professor Johnston QC comes to no definitive conclusion. However in order to apply either of these sections then the court must decide when the obligation has become enforceable. In my opinion it is not appropriate for the court to make that decision until after enquiry into the facts.
[42] Academic commentary also struggles to reconcile Harvie and Webster with the suggestion by Lord President Inglis in Stevenson v Pontifex and Wood (1887) 15R 125 that a fresh nuisance is committed every day and so a fresh period of prescription of the right to restrain it begins every day and tentatively offers the following solution:
“It may therefore be necessary to restrict the scope of Lord President Inglis’ remarks…and to say this: once the victim of the nuisance is exposed to harm or inconvenience which goes beyond what is tolerable (the cases often say what is plus quam tolerabile) he has a right of action to restrain the nuisance. But as soon as any fresh harm is done or the nuisance in any way increases, there is a new cause of action” (Johnston p219)
[43] This takes us right back to the question of whether the defenders’ activity in this case is plus quam tolerabile, which as I have stated cannot be decided without enquiry into the facts.
[44] In the light of all of the above, in my opinion a proof before answer is required before the court can come to a decision on prescription.
Specification in Respect of Liability
[45] I now turn to matters of specification raised on behalf of the defenders which are not dealt with elsewhere in this opinion.
[46] The pursuers’ averment in Article 2 that “it is not an essential part of the process that the ethanol is permitted to escape the premises and to damage neighbouring properties” gives fair notice to the defenders. The defenders have been put on notice that the pursuers accept that it is essential to the process that ethanol escapes from the casks themselves but do not accept it as essential that once the ethanol has escaped from the cask it must be permitted to escape the warehouses in the way that it does. As a leading manufacturer of whisky, the defenders can be expected to know whether such escape from the warehouse is essential to the manufacture of whisky and to be able to lead evidence on that point if so advised.
[47] The pursuers’ averments in Article 3 give fair notice to the defenders. Article 3 sets out circumstances which the pursuers say are favourable to the establishment of the fungus. The pursuers refer in Article 5 to various scientific publications on which their case on the Baudoinia compniacensis fungus is based. Taken together these articles of condescendence are sufficient for the defenders to instruct scientific experts to give them advice on what circumstances are favourable to the fungus. Indeed, a scientific rebuttal is set out in the defenders’ answers.
[48] The pursuers’ averments in Article 4 are sufficient to give fair notice. Pleadings should aver the facts which the pursuer offers to prove and should not aver evidence. The defenders argue that the pursuers give no detail to support their averment that “the black fungus is Baudoinia compniacensis” It is difficult to see how the fact which the pursuers offer to prove could be stated any more clearly. Either the fungus is Baudoinia compniacensis or it is not. The pursuers also set out what they mean by “elevated” and it is not necessary for the pursuers to go beyond this and plead the evidence on which their averments are based.
[49] The pursuers’ averments in Article 5 are sufficient to give fair notice. The defenders submission on these averments is essentially that the defenders do not agree with the criticisms the pursuers make of the Health Protection Scotland report. That is an issue for proof before answer.
Quantum
[50] The pursuers’ averments as to quantum are set out in Article 6 of condescendence as follows:
“COND.6. As a result, the pursuers have sustained loss and damage. The black fungus covers the pursuers’ house and outdoor property. It covers the verge tiles, the gutter, fascias, the soffits and the walls. The roof has visible black staining. The prevalence of black fungus on properties within the area is well known. The pursuers have suffered a reduction in the value of their house. The capital value of their house has been reduced as a result of the fungus. In addition, the pursuers incur annual cleaning costs as a result. They require to have their house and car cleaned regularly in an ongoing attempt to control the fungus. Expenses include pressure washing, bleach, paint brushes and the purchase of a ladder. They incur costs in relation to accessing the roof of their property. Details will be lodged in process. This will continue into the future. In addition, the pursuers have lost personal property as a result of the fungus. The black fungus has discoloured garden tables, garden chairs, potted plants and outdoor toys. It has attacked wooden garden furniture and paving stones. A sundeck was destroyed. The pursuers have required to replace a number of possessions as a result of damage caused by the fungus. Details will be lodged in process. In addition, the pursuers have suffered a loss in their enjoyment of the use of their property. They are restricted in the type of materials they can use in their garden. They require to use aluminium rather than wood. They are restricted in the design and layout of their garden. The pursuers are restricted in their choice of the colour of paint they can use in their garden. They require to choose colours which attempt to reduce the visual impact of the black fungus. Painting of decking and fencing requires to be carried out on a regular basis. In the circumstances, the sum sued for is reasonable. The defenders’ averments in answer are denied.”
[51] In this action the pursuers are seeking damages in the sum of £100,000. The averments give no specification of how that sum is made up. They put no figures on any of the damage which they aver. They aver that details will be lodged in process. No such details had been lodged at the date of the hearing. Mr Moynihan indicated that such details were available and could be supplied.
[52] As the pleadings stand, there is force in the defenders’ argument that this article of condescendence is lacking in specification. The defenders are entitled to fair notice of how the sum sued for is made up. They are entitled to fair notice as to when and by how much the house has reduced in value. They are entitled to fair notice of the basis on which the reduction in value has been assessed in order that they may consider whether the other costs for which damages are sought have already been taken into account in the reduction in value. They are entitled to fair notice of when the damage occurred. The defenders are also entitled to fair notice as to what precisely is meant by the fungus having attacked and destroyed certain items, and the mechanism or process by which the pursuers say that the fungus did this, so that the defenders can, if so advised, obtain expert scientific advice on whether the fungus can or did have that effect.
[53] In addition, I note that the pursuers aver that costs will continue into the future. Mr Moynihan explained that the damages sought are a one off figure covering both past loss and all future loss and a multiplier would be applied. It will be important to be clear which elements of the loss and damage are attributable to the future and accordingly full specification of this is required.
[54] Given that Mr Moynihan has indicated that further details are available, and that there is a case suitable for enquiry on the merits, I propose to take the course taken by the Lord Ordinary in Esso Petroleum Company v The Scottish Ministers [2015] CSOH 21 and give the pursuers an opportunity to seek leave to amend for the purpose of giving full specification of their averments of loss.
By Order
[55] Towards the conclusion of the hearing Mr Moynihan invited me to put the case out by order to enable him to clarify and give notice of the pursuers’ position on the treatment of ethanol escaping from the casks.
Disposal
[56] In my opinion the pursuers have pled a sufficient case on liability to allow their averments on liability to go to proof before answer. They have not pled a sufficient case on loss, but I shall give them an opportunity to seek leave to amend. I shall put the case out by order to discuss the appropriate interlocutor and further procedure in the light of my decision. This will also give parties an opportunity to address me on the matter referred to in paragraph [55] of this opinion. I reserve all questions of expenses in the meantime.