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Stockfeld v Hendon

Stockfeld v Hendon

Case [2021] VSC 133 26 March 2021

Restrictive Covenant

Severance

Contract Formation

Statutory Interpretation

Property Law

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IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

PROPERTY LIST

S ECI 2020 01583

SIMON ROBERT DAVID STOCKFELD & ANOR (according to the attached Schedule)	Plaintiffs
v
SHARON JOY HENDON & ORS (according to the attached Schedule)	Defendants

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JUDGE:	Hetyey AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	17 November 2020
DATE OF JUDGMENT:	26 March 2021
CASE MAY BE CITED AS:	Stockfeld & Anor v Hendon & Ors
MEDIUM NEUTRAL CITATION:	[2021] VSC 133

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PROPERTY LAW – Restrictive covenant – Property Law Act 1958 (Vic) s 84(2) – Proper construction of covenant – Development on property limited to ‘a good and substantial double fronted dwelling house with necessary outbuildings’ – Minimum cost requirement – Requirement for plans to be approved by an agent nominated by vendor – Restriction on construction of more than one such building – Effect of death of agent on restrictions contained within covenant – Whether relevant restrictions became absolute or spent on death of agent – Whether only approval requirement spent on death of agent – Severance – Whether approval requirement can be severed from remainder of covenant – Whether covenant prevents development of more than one dwelling house on the property.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr M Townsend and Mr C Tran	MPW Lawyers
For the Defendant	Mr S Horgan QC and Mr W Rimmer	Rogers & Gaylard Lawyers

TABLE OF CONTENTS

Introduction........................................................................................................................................ 1

Background......................................................................................................................................... 1

Procedural history.............................................................................................................................. 5

Applicable Law................................................................................................................................... 6

Principles of construction................................................................................................... 7
Review of authorities on consent requirements in covenants...................................... 9

Nature of approval requirement................................................................................................... 15

Construction of covenant as a whole........................................................................................... 17

Textual analysis.................................................................................................................. 19
Other context...................................................................................................................... 20

Effect of death of Elliott Cairnes on operation of the covenant............................................. 21

Can the approval requirement be severed?................................................................................ 28

Availability of severance.................................................................................................. 28
Application of severance.................................................................................................. 31

Status of cost requirement.............................................................................................................. 34

Alternative contentions regarding the single building restriction........................................ 35

No restriction on number of dwellings?........................................................................ 35
No restriction on number of buildings?......................................................................... 38

Conclusion......................................................................................................................................... 39

HIS HONOUR:

Introduction

In this proceeding, Simon and Rachel Stockfeld (‘the plaintiffs’) seek declarations about a restrictive covenant that limits the development and use of their property located at 357-359 Wattletree Road, Malvern East (‘the property’).[1] The covenant was created more than a hundred years ago. It provides, amongst other things, that construction on the property is limited to ‘a good and substantial double fronted dwelling house with necessary outbuildings’, that plans be approved by an agent by the name of Mr Elliott Cairnes, and that there only be one such building on the property (‘the covenant’). However, Mr Cairnes is now deceased. The principal question before the Court is: what is the effect of the death of Mr Cairnes on the operation of the covenant? Does it mean the relevant development restrictions contained in the covenant have become absolute? Alternatively, are the restrictions now discharged and no longer in force? Or, is it only the requirement for approval by…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Stockfeld v Hendon

Details

AGLC: Stockfeld v Hendon [2021] VSC 133
Case: [2021] VSC 133
Decision Date: 26 March 2021

CaseChat Overview and Summary

The case of Stockfeld v Hendon involved a dispute concerning restrictive covenants imposed on a property. The plaintiff, Stockfeld, sought to enforce certain covenants against the defendant, Hendon, who owned the property. The restrictions in question limited the development of the property to a double fronted dwelling house with necessary outbuildings, imposed a minimum cost requirement, mandated approval of plans by an agent nominated by the vendor, and restricted the construction of more than one such building. The dispute arose after the death of the agent appointed to approve plans, leading to questions about the enforceability of the covenants.

The primary legal issues the court needed to address were the effect of the agent’s death on the restrictive covenants, whether the restrictions became absolute or lapsed, and if only the approval requirement lapsed, leaving the other restrictions intact. Additionally, the court had to determine whether the approval requirement could be severed from the rest of the covenant and if the covenant effectively prevented the development of more than one dwelling house on the property. These issues were crucial in assessing the enforceability of the covenants and the extent to which they could be modified or removed.

The court concluded that upon the death of the agent, the approval requirement of the covenant lapsed, but the other restrictions remained enforceable. The court held that the approval requirement was severable from the other restrictive covenants, meaning that the remaining restrictions continued to apply. The court found that the covenant did indeed prevent the development of more than one dwelling house on the property. Consequently, the court upheld the enforceability of the remaining covenants, thereby restricting the defendant from constructing additional buildings on the property.

The final orders of the court were that the restrictive covenants, excluding the lapsed approval requirement, remained in effect and enforceable against the defendant. The court declared that the defendant could not construct more than one dwelling house on the property and that any plans for development must comply with the remaining restrictions. The court’s decision provided clarity on the enforceability of restrictive covenants and the impact of the death of an appointed agent on such covenants.

Orders