Midland Brick Company Pty Ltd v Welsh

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JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CIVIL

CITATION:   MIDLAND BRICK COMPANY PTY LTD -v- WELSH & ANOR [2006] WASC 122

CORAM:   HASLUCK J

HEARD:   22, 23, 28 & 29 MARCH 2006

DELIVERED          :   27 JUNE 2006

FILE NO/S:   CIV 2605 of 2002

BETWEEN:   MIDLAND BRICK COMPANY PTY LTD (ACN 008 674 224)

Plaintiff

AND

MARIAN CONCEPTA WELSH
First Defendant

REGISTRAR OF TITLES
Second Defendant

Catchwords:

Property law - Restrictive covenant - Negative covenants included in contract of sale and subsequent deed - Covenants by purchaser not to subdivide the land being acquired and not to complain about emissions from brickworks on land retained by the vendor - Intention of parties as to benefit and burden not set out expressly - Issue as to whether covenants touch and concern land retained by vendor - Whether burden of covenants runs with the land the subject of the sale - Principles of interpretation - Parol evidence rule - Application of s 47 and s 48 of Property Law Act 1969 (WA)

Adequacy of caveat lodged to protect vendor's interest in the land - Whether restrictive covenant creates a caveatable interest in the land burdened by the covenant - Whether covenant not to subdivide can justify lodgment of an absolute caveat - Description of interest held to be inadequate

Legislation:

Law of Property Act (1925) (UK), s 11(1), s 78, s 79
Property Law Act 1969 (WA), s 47, s 48, s 49

Transfer of Land Act (1893) (WA), s 53, S 68, s 137, s 138, s 138C, s 138D(1)(e), s 139

Result:

Judgment for plaintiff

Category:    A

Representation:

Counsel:

Plaintiff:     Mr S G Leslie

First Defendant             :     Ms W F Buckley

Second Defendant         :     No appearance

Solicitors:

Plaintiff:     Wilson & Atkinson

First Defendant             :     Anderson Kershaw

Second Defendant         :     No appearance

Case(s) referred to in judgment(s):

Abigail v Lapin (1934) 51 CLR 58

Acorn Consolidated Pty Ltd v Hawkslade Investments Pty Ltd (1999) 21 WAR 425

Adamson v Hayes (1973) 130 CLR 276

Australian Broadcasting Commission v Australasian Performing Right Association Ltd (1973) 129 CLR 99

Baramon Sales Pty Ltd v Goodman Fielder Mills Ltd [2001] FCA 1672

Beswick v Beswick (1968) AC 58

Binningup Nominees Pty Ltd v Brogue Tableau Pty Ltd [2004] WASC 14

Blacks Ltd v Rix [1962] SASR 161

BP Refinery (Westernport) Pty Ltd v Hastings Shire Council (1977) 180 CLR 266

Butler v Fairclough (1917) 23 CLR 78

Chambers v Randall [1923] 1 Ch 149

Clem Smith Nominees Pty Ltd v Farrelly & Farrelly (1978) 20 SASR 227

Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337

Coles KMA Ltd v Sword Nominees Pty Ltd & Ors (1986) 44 SASR 120

Commissioner of Taxation of the Commonwealth of Australia v Sara Lee Household & Body Care (Australia) Pty Ltd (2000) 201 CLR 520

Commonwealth v Verwayen (1990) 170 CLR 394

Crampton v French (1995) V ConvR 54‑529

Cruz v Osborne [1999] WASC 8

Dalgety Wine Estates Pty Ltd…

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Details
Case
[2006] WASC 122
Decision Date

CaseChat Overview and Summary

Midland Brick Company Pty Ltd v Welsh is a property law case that addresses the enforceability of restrictive covenants in a contract of sale and a subsequent deed. The dispute involved a covenant by the purchaser not to subdivide the land being acquired and a covenant not to complain about emissions from brickworks on land retained by the vendor. The central issue was whether these covenants touch and concern the land retained by the vendor, thus creating a burden that runs with the land. Additionally, the case examined the adequacy of the caveat lodged by the vendor to protect their interest in the land burdened by the covenant, particularly whether the covenant not to subdivide justified the lodgment of an absolute caveat and whether the description of the interest held was adequate.

The court was required to interpret the intention of the parties concerning the benefit and burden of the covenants. It had to determine whether the covenants were intended to benefit the land retained by the vendor and burden the land sold. The court also considered the application of the parol evidence rule and sections 47 and 48 of the Property Law Act 1969 (WA). These sections relate to the transfer of land and the effect of contracts and other instruments on the land. The court had to decide whether the restrictive covenant creates a caveatable interest in the land burdened by the covenant and whether the covenant not to subdivide can justify lodgment of an absolute caveat.

The court found that the restrictive covenants were intended to benefit the land retained by the vendor and burden the land sold. It held that the covenants touch and concern the land retained by the vendor, thus creating a burden that runs with the land. The court also determined that the covenant not to subdivide can justify the lodgment of an absolute caveat, but the description of the interest held was inadequate. Consequently, the covenant was not a caveatable interest, and the caveat was insufficient to protect the vendor's interest. The court's decision underscores the importance of clearly articulating the benefit and burden of restrictive covenants in property transactions and the necessity of accurately describing interests in caveats to ensure their effectiveness.

Orders

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Background to the litigation

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Evidence

Evidence Before The Court

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Ratio Decidendi

Legal Principle Established

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