Big River Paradise Ltd v Congreve

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IN THE SUPREME COURT OF NEW ZEALAND
SC 21/2008
[2008] NZSC 51
BETWEENBIG RIVER PARADISE LIMITED

Applicant

ANDROBIN LANCE CONGREVE, ERICA MARGARET CONGREVE AND THOMAS ALBERT CECIL MURRAY

Respondents

Court:Tipping, McGrath and Wilson JJ
Counsel:T G Stapleton for Applicant

G P Curry for Respondents

Judgment:15 July 2008

JUDGMENT OF THE COURT

The application for leave to appeal is dismissed, with costs of $2,500 to the respondents.

REASONS
[1] The applicant seeks leave to appeal against a judgment of the Court of Appeal.[1] That Court dismissed an appeal by the applicant against a judgment of the High Court holding that a subdivision proposed by the applicant would breach a restrictive covenant in favour of the respondents. The respondents are the trustees of a trust called the Congreve Family Trust.
[1] [2008] 2 NZLR 402.
[2] The covenant reads:
No subdivision of the Servient Lot shall permit the creation of more than three separate allotments nor permit more than one dwelling to be erected on each such allotment.

[3]       The respondent proposes a subdivision into 52 leasehold interests, with each lessee having a lease with a term of less than 30 years and the right to construct a dwelling. Because the term is less than 35 years, the proposed development does not fall within the definition of a “subdivision of land” in s 218(1)(a)(iii) of the Resource Management Act 1991. The applicant submits that, because of this, the covenant does not apply.
[4]       This argument failed in the Courts below, and for the reasons set out in the judgments of those Courts it cannot possibly be right. In summary, these reasons were as follows. First, the applicant’s approach is contrary to the plain ordinary meaning of the words of the covenant. Secondly, it would defeat the obvious purpose of the covenant of protecting the respondents’ land, which is across the Clutha River from that of the applicant, from the consequences of subdivision (in the ordinary sense of the word) of the latter’s land. Thirdly, when the covenant was executed in 2001, the definition of “subdivision of land” in the Resource Management Act included leases with a term of more than 20 years. The proposed development therefore came within the definition at the time the covenant was given. In the unlikely event that the parties at that time turned their minds to the Resource Management Act, it would have been to the definition as it then read and not to some unknown future and different meaning.
[5]       Even if the applicant’s position were seriously arguable, it would not raise any matter of general or public importance, or any matter of general commercial significance.
[6]       The application for leave to appeal is therefore refused. The applicant must pay costs of $2,500 to the respondents.
Solicitors:
Evans Henderson Woodbridge, Marton for Applicant
Russell McVeagh, Auckland for Respondents

CaseChat Overview and Summary

In the Supreme Court of New Zealand, Big River Paradise Limited sought leave to appeal a decision made by the Court of Appeal. The case, SC 21/2008, involved a dispute over a proposed subdivision by the applicant that the respondents, trustees of the Congreve Family Trust, claimed would breach a restrictive covenant. The Court of Appeal had previously dismissed the applicant's appeal against a High Court judgment which held that the proposed subdivision would indeed breach the covenant. The covenant in question specified that no subdivision of the servient lot could permit the creation of more than three separate allotments or more than one dwelling on each allotment.

The legal issues before the Supreme Court were whether the applicant's proposed subdivision into 52 leasehold interests, each with a lease term of less than 30 years, was subject to the restrictive covenant and whether the applicant's interpretation of the term "subdivision of land" as defined in the Resource Management Act 1991 was correct. The applicant argued that since the leases were for less than 35 years, the proposed development did not fall within the Act's definition of a "subdivision of land" and thus the covenant did not apply. However, the Court found this argument to be contrary to the plain meaning of the covenant and would defeat its purpose of protecting the respondents' land from the consequences of subdivision. Furthermore, at the time the covenant was executed, the definition of "subdivision of land" in the Act included leases with a term of more than 20 years, which the proposed development would have fallen under.

The Supreme Court held that the applicant's position was not seriously arguable and did not raise any matter of general or public importance or general commercial significance. Consequently, the application for leave to appeal was dismissed, and the applicant was ordered to pay costs of $2,500 to the respondents.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established