A recent decision from the British Columbia Supreme Court is a good reminder that owners and contractors that plan to use construction cranes in urban areas should incorporate air space rights into their construction planning and obtain any such rights prior to carrying out work.
In the decision the Court ultimately found that:
- A construction crane that enters the air space of another property is trespassing upon that air space;
- The movement of a crane through air space over the neighbour’s terrace gave rise to a risk of irreparable harm; and
- The balance of convenience favoured granting an injunction against an owner who disregarded the hours that it was licensed to have a construction crane pass through a neighbour’s air space.
What Happened?
The decision in OSED Howe Street Vancouver Leaseholds Inc. v FS Property Inc., 2020 BCSC 106 arose from an application for an interim injunction to prevent the defendant FS Property Inc. (“FSP”), from allowing the counter jib of a construction crane to pass over the air space of a neighbouring building leased by OSED Howe Vancouver Leaseholds Inc. (“OSED”).
Prior to the dispute, OSED and FSP had negotiated a crane swing construction platform and security license agreement (the “License Agreement”). Under the terms of the License Agreement, OSED agreed to allow FSP to move the crane through OSED’s air space for eight hours each weekday and one day each weekend. The parties also agreed that FSP could use the air space for additional hours if OSED agreed to the additional hours in writing.
Two months later, FSP advised OSED that the licensed hours were too restrictive and costly. FSP asked OSED to agree that FSP could operate over the terrace without restriction. The next day, before receiving OSED’s consent, FSP began operating the crane through OSED’s air space without regard to the hours set out in the License Agreement. OSED sent objection letters to FSP, who disregarded them and continued to operate during unlicensed hours. Accordingly, OSED sought an injunction from the Court.
The Decision
The Court based its decision on the three part test outlined in RJR Macdonald Inc. v. Canada (Attorney General),[1] which requires an applicant seeking an injunction to show that:
1) it has raised a serious question to be tried;
2) it will suffer irreparable harm in the absence of the injunction; and
3) the balance of convenience favours the issuance of an injunction.
Serious Question to be Tried
With respect to the first factor, OSED claimed that FSP had trespassed or committed a nuisance when its crane entered OSED’s air space, and that FSP had breached the License Agreement. FSP did not disagree that its crane entered OSED air space or challenge the existence of the License Agreement, but claimed that OSED could not advance a claim in breach of contract because it failed to act in good faith when it refused to modify the License Agreement to accommodate FSP’s legitimate needs.
The Court rejected FSP’s argument that OSED failed to act in good faith noting that OSED did not have any obligation to agree to the new terms proposed by FSP and that there was no evidence to support the proposition that OSED failed to consider FSP’s request. The Court also held that a construction crane that enters the air space of another property is trespassing upon that air space and that an ongoing trespass had been committed by the FSP-controlled crane.
Irreparable Harm
With respect to irreparable harm, OSED argued that its tenants could not use the terrace while the crane was in operation and that this constituted a significant interruption to its business and jeopardized its application for LEED Platinum certification. FSP, in response, attempted to argue that OSED’s claim of harm was based on mere speculation and did not meet the evidentiary standard required to establish irreparable harm.
The Court rejected FSP’s argument, stating at paragraph 37:
I find that OSED will suffer irreparable harm if FSP is permitted to use its crane outside of the licenced hours. OSED has a legitimate interest in pursuing its LEED Platinum certification and the provision of the terrace is a feature of that application, OSED promises tenants use of the terrace as [an] amenity in the building, and OSED recognizes that tenants and workers have a legitimate apprehension about relaxing or working in an area underneath a moving 10,600 lb counterweight.
Balance of Convenience
FSP argued that the balance of convenience weighed against the granting of the injunction claiming:
- FSP would incur additional overtime and delay costs if forced to work only during licensed hours;
- The COVID pandemic already placed a significant strain on FSP’s financial position as FSP operated 13 hotels around the world and was losing money; and
- There was a public interest in completing the construction as quickly as possible to minimize disruption to FSP’s neighbours and others using the area.
The Court rejected FSP’s arguments noting that, while there is no perfect solution to construction in a densely populated urban environment, OSED and FSP struck a reasonable balance of the property rights of OSED and the interest of FSP in completing construction by entering into the License Agreement. The Court found that FSP’s breach of the License Agreement exclusively for its own economic benefit stripped OSED of all retained property rights to its air space. Taking all of the above into consideration, the Court ordered the injunction sought by OSED.
Implications
The decision makes clear that parties using construction cranes in urban areas should ensure that they have necessary air space rights, and properly negotiate any crane swing easement agreements that may be required prior to undertaking work.
The Courts will not forgive a trespass to a neighbouring property’s air space merely on the grounds that it convenient or saves costs.
[1] RJR Macdonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311.
