Brymat Pty Ltd v Kaljo

Brymat Pty Ltd (the appellant) appealed to the New South Wales Court of Appeal against a decision of the Supreme Court of New South Wales. The dispute concerned the interpretation and enforceability of a restrictive covenant contained within a deed of sale for a property. The appellant sought to argue that the covenant, which restricted the use of the vendor's retained land, was invalid and unenforceable.

The primary legal issue before the Court of Appeal was whether the restrictive covenant, which purported to bind the vendor's retained land and prevent the construction of any building thereon without the consent of the purchaser, was valid and enforceable. This involved considering whether the covenant "ran with the land" and was therefore capable of binding successors in title, and whether it constituted an unreasonable restraint on trade or was otherwise void for uncertainty or as a clog on the equity of redemption.

The Court of Appeal, in allowing the appeal, found that the restrictive covenant was indeed valid and enforceable. The court reasoned that the covenant was not a clog on the equity of redemption, as it did not fetter the mortgagor's right to redeem the property. Furthermore, the court held that the covenant did not constitute an unreasonable restraint on trade, as its purpose was to protect the amenity and value of the purchaser's property, rather than to stifle competition. The covenant was considered sufficiently certain in its terms and was held to run with the land, binding the vendor and its successors in title.

Consequently, the Court of Appeal set aside the order of the Supreme Court and declared that the restrictive covenant was valid and enforceable.