Chisholm v The Bankstown Trotting Recreational Club Ltd

The case of Chisholm v The Bankstown Trotting Recreational Club Ltd involved a dispute between the parties over the sale of a parcel of land, which was sub-licensed to the respondent, and the subsequent assertion of an easement by the sub-licensee. The matter was heard by the Supreme Court of New South Wales. The primary issue before the court was whether the sub-licensee was estopped from asserting the easement granted in the sale, given the representations made to the licensee regarding the impact of the sale on the existing arrangements.

The court examined the principles of equitable estoppel and estoppel by convention, determining whether the sub-licensee was precluded from asserting the easement due to the representations made and the shared assumption between the parties. The court also considered the interpretation of the sub-licensee agreement, specifically the provision regarding the payment of an annual fee and the relevance of market value evidence in determining the fee. Furthermore, the court assessed whether the conduct of the parties in entering into the sale transaction amounted to misleading or deceptive conduct, given the failure to inform the licensee of the proposed easement.

In its reasoning, the court found that the sub-licensee was indeed estopped from asserting the easement, as the representations made to the licensee regarding the impact of the sale were sufficient to establish an estoppel by convention. The court held that the sub-licensee was precluded from departing from the shared assumption that the sale would not affect the licensee’s existing arrangements. The court also found that the conduct of the parties in entering into the sale transaction amounted to misleading or deceptive conduct, as the licensee could reasonably expect to be informed of the proposed easement. The court declined to rectify the contract for the sale of land, finding that the alleged common intention of the parties was not established on the evidence.