Bankside Yards – Assessment of Damages

The High Court judgment in Cooper & Powell v Ludgate House Ltd (2025), known as the Bankside Yards judgement, is now one of the most consequential rights to light rulings in recent years. Section VIII of the Bankside Yards judgment addresses the assessment of damages, a fundamental issue for developers, surveyors, and legal professionals alike:

"What damages should be awarded: negotiating damages or damages for diminution in value?"

This question sits at the heart of rights to light valuation and dispute resolution strategy. In the Bankside Yards dispute, the Court's choice between these two competing forms of damages had significant implications—not only for the sums awarded but also for how future developments will be risk-assessed and negotiated.

In this article, we examine the Court's reasoning in detail, assess its implications for valuation methodology, and compare the ruling with other key decisions on rights to light compensation.

Bankside Yards Assessment of Damages : Understanding the Context

The case arose from claims by the owners of two flats at Bankside Lofts—Mr Cooper (flat 705) and Mr and Mrs Powell (flat 605)—that their rights to light had been infringed by the construction of Arbor, a 19-storey office building within the Bankside Yards development.

The Court accepted that an actionable nuisance had occurred. The question then turned to remedy. The claimants sought damages. The developer (Ludgate House Ltd) argued that any compensation should be modest, suggesting either no award or one based on the diminution in value of the affected flats.

The Court was therefore required to decide:

Whether to award negotiating damages (i.e. a hypothetical sum the claimants might have accepted in exchange for releasing their rights before development);

Or to base the award on diminution in value (i.e. the actual reduction in market value of the flats caused by the loss of light).

Negotiating Damages vs. Diminution in Value: Legal Framework

The assessment of damages in rights to light cases has been significantly shaped by the principle established in Wrotham Park Estate Co Ltd v Parkside Homes Ltd (1974), and more recently clarified by the Supreme Court in Morris-Garner v One Step (Support) Ltd (2018).

In Wrotham Park, Brightman J awarded damages based not on the diminution in value of the claimant's land, but on a notional licence fee the defendant might reasonably have paid to proceed with a profitable development that infringed property rights. This created the foundation for what later became known as "negotiating damages."

Morris-Garner refined the doctrine, holding that negotiating damages are not available as of right but may be awarded where there has been a deliberate and profitable breach of rights that would otherwise justify injunctive relief.

In the context of rights to light, the Supreme Court in Morris-Garner v One Step clarified that negotiating damages – also referred to as Wrotham Park damages – may be appropriate where a deliberate breach of rights has occurred, particularly for commercial gain. This approach is not based on actual loss in market value but instead on the value of the right that has been taken away without permission.

Negotiating damages are appropriate where the infringement deprived the claimant of a bargaining position to license the use of their right - especially in the context of development gains.

The Court’s Analysis in Section VIII

In Bankside Yards, Mr Justice Fancourt rejected the argument for diminution in value damages. He held that such an approach would significantly undervalue the real impact of the interference.

The valuation evidence suggested that the actual reduction in market value for each flat was relatively small - £20,000 for Mr Cooper (flat 705) and £60,000 to the Powells (flat 605). However, as the judge pointed out, this does not reflect the position the claimants would have taken had they been approached pre-construction.

Instead, he found that the claimants were entitled to a fair share of the commercial benefit derived by the developer in proceeding with the building despite the known infringement. This is a textbook example of the rationale behind negotiating damages.

The judge explicitly acknowledged that:

The developer knowingly proceeded with the infringement.

The claimants' rights had value in the context of the overall development.

The Arbor building could not have been constructed in its current form without infringing those rights.

Therefore, negotiating damages were appropriate as the claimants were deprived of the opportunity to negotiate a release.

Assessment of Quantum: How the Damages Were Calculated

Unlike diminution in value, which is property-specific and market-based, negotiating damages are calculated based on a share of the uplift in land value or development profit resulting from the infringement.

The Court considered:

The additional value of the Arbor building as constructed, compared with a reduced or cut-back version that would not infringe.

The scale and severity of the light loss.

The reasonable expectations of both parties in hypothetical negotiations.

The presence of other settlements made by the developer with different neighbours.

Based on expert evidence and these factors, the Court awarded:

£350,000 to Mr Cooper (flat 705)

£500,000 to Mr and Mrs Powell (flat 605)

These sums were judged to reflect the likely outcomes of pre-emptive settlements. They were not formulaic but represented fair market value for the rights given up.

How Does This Compare to Other Cases?

This approach is consistent with earlier decisions such as:

Beaumont v Florala (2020), where negotiating damages of £350,000 were awarded, calculated at 33% of the developer’s profit attributable to the infringement.

Midtown v City of London Real Property (2018), where expert valuation of the development uplift formed the basis for calculating damages.

However, the Bankside Yards case is notable for applying this approach in the face of relatively modest diminution loss, thereby reinforcing the principle that rights to light have negotiable economic value, not just market consequences.

Bankside Yards Assessment of Damages : The Pitfalls of Diminution in Value

The Court reiterated several problems with relying on diminution in value:

It undervalues the strategic importance of light rights in high-density developments.

It fails to reflect the leverage a property owner has when approached in advance.

It ignores the development gain realised through the infringement.

For example, a flat owner may suffer a £20,000 reduction in value due to lost light, but could reasonably have demanded £350,000 to release their right in the context of a £20m commercial building uplift. Diminution in value simply does not capture that negotiation dynamic.

Valuation Best Practices: What Surveyors Should Note

Rights to light surveyors involved in damage assessments should:

Avoid defaulting to diminution in value unless clearly justified by case facts.

Analyse development uplift based on massing scenarios with and without infringement.

Consider the full context: strategic location, build viability, planning context, and any s.203 immunity resolutions.

Be prepared to provide expert evidence on pre-infringement settlement values.

Benchmark against known case outcomes and settlement precedents.

Using a release factor - the Courts suggesting between 10–33% of the development profit uplift - is often an accepted basis, with higher percentages applying where leverage, nuisance severity, or developer conduct warrants it.

Strategic Implications for Developers and Legal Advisers

This judgment is a strong reminder that:

Developers proceeding in the face of unresolved rights to light claims may face significant negotiating damages.

Surveyors and legal teams must assess not just light impact, but the development economics at play.

Early engagement and negotiated releases remain the most cost-effective strategy.

Section VIII affirms that claimants may recover more than just the reduction in their flat’s value - they are entitled to a share of the development value their rights would have constrained.

Key Takeaways : Bankside Yards Assessment of Damages

The Court awarded negotiating damages, not diminution in value.

Negotiating damages reflect a hypothetical pre-construction settlement.

Diminution in value was found to undervalue the claimants’ position.

Mr Cooper received £350,000; the Powells received £500,000.

The uplift in development value was central to the calculation.

GIA’s arguments for diminution in value damages based on market loss were rejected.

The judgment aligns with Beaumont and Midtown.

Rights to light have economic value beyond mere loss.

Surveyors must base advice on strategic and valuation context.

Developers ignore such risks at their financial peril.

Need Expert Advice on Rights to Light?

At Anstey Horne, our specialist Rights to Light surveyors have extensive experience advising developers, property owners, and legal teams across the UK. We help identify risks, negotiate solutions, and ensure your project progresses with confidence. Contact us today to discuss how we can help resolve any Rights to Light concerns.

For more information on how a right is acquired, measured and defended, please see our Fact Sheet, and for a collection of articles on all aspect of this service see our blog.

For advice on rights to light direct from one of our surveyors, please call our Rights to Light Enquiry Line on 020 4534 3138.

If you’d like us to call you, please fill in our Contact Us form and we will call you back.