The Supreme Court has handed down a ruling in a dispute between two London councils and Transport for London on the extent of the transfer of a 'highway'. David Elvin QC explains the outcome.
The Supreme Court (Lord Briggs with whom Lady Hale, Lord Reed, Lord Carnwath and Lord Lloyd-Jones agreed) gave judgment on 5 December in London Borough of Southwark & Another v Transport for London  UKSC 63 allowing an appeal by TfL and reinstating the award of the Arbitrator (with some alteration), John Male QC, on preliminary issues concerning what transferred as “highway” under art. 2(1)(a) of the GLA Roads and Side Roads (Transfer of Property etc.) Order 2000 (SI No.1152) in July 2000 on the designation of the first tranche of GLA Roads under the amendments made to the Highway Act 1980 by the Greater London Authority Act 1999.
The central issue on the appeal was whether art. 2(1)(a) transferred to TfL the entire interest of the councils in the vertical plane of the land on which the highway ran or only the surface of the highway (normally called the “top two spits” under the principle in Tunbridge Wells Corp v. Baird  AC 434) and sufficient sub-soil as was necessary for the use and operation of the highway (“the zone of ordinary use”).
Reversing the Court of Appeal  P.T.S.R. 333, the Supreme Court held that while the vesting of highways under s. 263 of the 1980 applied the Baird principle, art. 2(1)(a) was modelled on s. 265 which did not apply that principle and, thus, “highway” had a different meaning in s. 265 and art. 2(1)(a) from the more restrictive meaning of s. 263. In this respect, the Court disapproved a dictum of the Deputy Judge Mr Kim Lewison QC (as he then was) in Secretary of State v Baylis (Gloucester) Ltd (2000) 80 P & CR 324.
At paras. 28-30 Lord Briggs held:
“28. The question really boils down to this: does the Baird principle apply to article 2? In respectful disagreement with the Court of Appeal, I do not regard article 2 or, for that matter, section 265, as governed or constrained by the Baird principle. My reasons follow.
29. In my judgment article 2(1)(a) transfers to TfL ownership of all that part of the vertical plane relating to a GLA road vested in the relevant council on the operative date, but only to the extent that ownership was then vested in the council in its capacity as former highway authority. That is, in my view, the true meaning of the phrase “the highway, in so far as it is vested in the former highway authority”. It follows that:
i) rights held by the councils in the vertical plane of a highway as adjoining owner, for purposes other than highway purposes, do not pass under article 2(1)(a). This is because they are not held by the council in its capacity as highway authority.
ii) rights originally acquired for purposes other than highway purposes, or appropriated to those other purposes by the operative date, do not pass under article 2(1)(a). This is so whether or not some non-highway structure has by then been constructed. If acquisition or appropriation for non-highway purposes has occurred by the operative date, it matters not that the relevant purpose has yet to be fulfilled, so that the relevant part of the vertical plane remains undeveloped.
iii) rights originally acquired for highway purposes in the vertical plane, for example by conveyance on compulsory acquisition for highway purposes, do pass under article 2(1)(a), even if they extend beyond the zone of ordinary use, provided that they have not, by the operative date, been appropriated to some non-highway use outside the zone of ordinary use.
iv) All these consequences, and in particular the first, flow from the true construction of article 2, rather than merely by way of TfL’s concession as recorded by Mann J.
30. It may be that sub-paragraph (ii) of the above summary differs a little from the reasoning of the arbitrator. This is because, whereas he regarded a non-highway structure actually built in the vertical plane (like an over-flying building of underground public lavatory) as falling outside the definition of “highway” for all purposes, he did not (at least expressly) also regard the acquisition or appropriation of part of the vertical plane for non-highway purposes as sufficient on its own to take that part, even if undeveloped, out of the property transferred under article 2(1)(a).”
However, Lord Briggs rejected TfL’s contention  that “there should … be a strong presumption that all rights in the vertical plane as were in fact vested in the former highway authority on the operative date were vested in it in that capacity” and held:
“50. I can see no good reason why any such presumption or burden of proof should be identified as flowing from the true interpretation of article 2. The papers lodged with the court on this appeal demonstrate that the resolution of these vertical plane issues in the context of highways in Central London, where they cannot be agreed, is an intensely fact-sensitive and complex task. As already explained, the councils will have acquired rights in the vertical plane in a variety of different ways, and it will be necessary to analyse both the extent of the rights acquired, and the capacity in which the council acquired those rights. Sometimes the GLA road has a non-GLA highway running over or under it. There are frequently buildings and other structures encroaching upon the vertical plane of the highway, outside the zone of ordinary use. The arbitrator should not be saddled with a presumption as to the outcome of that difficult factual analysis, one way or the other.”
The Court did not express a view on the vesting of property in the lateral plane .