Chimbusco International Limited v Mayall Property Group Limited

[2017] NZHC 2278

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2017-404-422 [2017] NZHC 2278

BETWEEN

CHIMBUSCO INTERNATIONAL

LIMITED Applicant

AND

MAYALL PROPERTY GROUP LIMITED

First Respondent

AUCKLAND COUNCIL Second Respondent

Continued…

Hearing:	14 September 2017
Counsel:	S W M Piggin for plaintiff No appearance for respondent
Judgment:	20 September 2017

JUDGMENT OF WHATA J

This judgment was delivered by me on 20 September 2017 at 3.30 pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date: ………………………….

Counsel:            S W M Piggin, Barrister, Auckland

CHIMBUSCO INTERNATIONAL LIMITED v MAYALL PROPERTY GROUP LIMITED [2017] NZHC 2278 [20 September 2017]

TOM KROON AND ANTJE KROON Third Respondents

HUADA INVESTMENT LIMITED Fourth Respondent

ESTUARY CHT LP Fifth Respondent

TSAN FAI LO, CAN RONG LUO AND WEI ZHU ZENG

Sixth Respondents

WEIHONG HE Seventh Respondent

LIANSEN MAO Eighth Respondent

ER XIA CAO, ER SHENG CAO AND JUN WU Ninth Respondents

MEI WO MICHAEL LAW AND IN MAN MANDY LAW LEE

Tenth Respondents

LEADING DEVELOPMENT LIMITED Eleventh Respondent

WANDA DEVELOPMENTS LIMITED Twelfth Respondent

XINHAO DEVELOPMENTS LIMITED Thirteenth Respondent

YING-TSUNG LIN AND WEI-I LIN Fourteenth Respondents

TSUNG KUANG CHEUH AND HUI-HSIANG KAO Fifteenth Respondents

Introduction

[1]      This is an application for formal proof seeking the following order:

(a)      An order extinguishing land covenants created by transfer 226706.1 and transfer 272617.1 from the title to the land at 218 Flatbush Road, Flatbush, Auckland, identifier 482725 (North Auckland Land Registry).

[2]      I resolved to make the order.  My reasons follow.

Background

[3]      The applicant owns the property known as 218 Flatbush School Road, East

Tamaki, Auckland. The title is 482725, North Auckland Land Registration District.

[4]      The title of the applicant is subject to land covenants in Transfer 226706.1 and Transfer 272617.1.

[5]      The covenants in these two transfers are the same. They provide:

DOTH HEREBY COVENANT AND AGREE with the Transferor for the benefit  of  the  land  described  in the  Schedule  hereto  and  not  heretofore transferred by the Transferor and also separately with each and every one of the registered proprietors of and for the benefit of the land described in the said  Schedule  and  heretofore  transferred  to  such  proprietors  by  the Transferor that the Transferee will not at any time or times hereafter:-

(a)     use the land first described or permit the same to be used for any trading or commercial purpose other than a farming or agricultural purpose which does not involve retail selling;

(b)     keep or allow to be kept any pigs upon the land first described;

(c)     keep or allow to be kept any poultry upon the land first described except such as may be reasonable for the domestic use of those occupying the land first described;

(d)     deposit or allow to be deposited or left on any part of the land first described any rubbish or water or other unsightly material;

(e)     erect or place or permit to be erected or placed upon the land first described any caravan hut or shed to be used as a dwelling or temporary dwelling on the land first described nor any glasshouse

except one not exceeding 200 square feet in area on each lot into which the land first described may be subdivided;

(f)      erect or permit to be erected or place or permit to be placed on the land first described any buildings other than in respect of each lot into which the land first described may be subdivided one family dwellinghouse or alternatively two attached family living units to the value in either case at the time of such erection or placing of at least

$12,000, together with, if required by the Purchaser, a garage or such other out buildings in permanent materials as would normally be appurtenant to such family dwellinghouse or living units;

(g)     without the prior consent in [writing] of Aylesbury Farms Limited use or  permit  to  be  used  any  previously  used  buildings  or  building materials for the purpose of any buildings or erections otherwise not prohibited from being erected or placed on the land first described;

TO THE END AND INTENT that the said restrictions shall enure for the benefit of all the land described in the Schedule hereto and every part thereof PROVIDED ALWAYS that the Transferee shall as regards the said restrictions be liable only in respect of breaches thereof which shall occur while the Transferee shall be the registered proprietor of the land first described or any part thereof in respect of which any such breach shall occur and provided also that none of such restrictions shall continue to have any force or effect at any time after all the land in the said Plan shall have been zoned residential or otherwise by the Manukau City Council or other body having authority in that behalf …

[6]      The  principal  dominant  titles  are  owned  by  the  respondents  in  this proceeding.  Titles which have been derived from recent subdivisions of much larger titles which were dominant tenements have also been identified by the applicants.

[7]      At the date of the covenants, the land in the plan mentioned in the covenants had a rural zoning.  The general zoning of all this land is now residential but there are some areas of titles which the Council has zoned for reserve.  The character of the neighbourhood is also now residential and there is now extensive residential development in Flatbush, particularly in the area around Ormiston Road.

[8]      The applicant now wishes to carry out a subdivision of its land.  Some of the respondents are also subdividing their land into residential titles.   A number of subdivisions   have   occurred   following   orders   made   by   this   Court   for   the

extinguishment of the same covenants.1

1      Green land Investment Ltd v G R International Ltd [2016] NZHC 213; UMH Group Ltd HC Auckland CIV-2015-404-1993, 13 October 2015; and Leading Developments Ltd v Blair [2016] NZHC 2428.

[9]      The covenants themselves provided in each case that none of the restrictions in the covenants would apply or continue to have force after all land in the plan has been zoned residential.

Process

[10]     The application is not opposed.   Mr Lau sought to appear on behalf of an owner, Mr Mao, and a caveator in relation to the same land, Ms Lin.  Leave was not granted to Mr Lau to appear on their behalf and timetabling orders were set down for those interested parties to lodge formal notices of opposition by 23 August 2017. They did not take that step.  It transpired, however, that a Ms Yutian Li sought leave to file a notice of opposition apparently on behalf of Mr Mao and/or Ms Lin.  This

was also declined.2    Mr Lau nevertheless again sought to appear in relation to this

application, purporting to file an application to set aside the formal proof hearing. He alleges he now has a direct interest in the properties owned by Mr Mao and subject to a caveat by Ms Lin, as a consequence of nomination in consideration for management fee debts.  No evidence of this assignment was produced.  I declined his application.   I was not satisfied he had a sufficient interest to appear. In any event, any purported interest he had was aligned to the interests of Mr Mao and Ms Li and the time for them to file notices of opposition had expired on 23 August 2017.

Assessment

[11]     There has been no opposition, and given the change in zoning in terms of the effect of titles, it is appropriate in terms of s 317 of the Property Law Act 2007 for the  land  covenants  to  be  extinguished.     The  fact  the  covenants  themselves contemplate they will cease if the land is zoned residential fortifies the appropriateness of the order.

[12]     Accordingly, there shall be an order pursuant to s 317 of the Property Law

Act 2007 extinguishing the land covenants as noted above.

2      Minute of Hinton J dated 25 August 2017.