Estuary CHT LP v Mayall Property Group Limited

[2020] NZHC 3079

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2020-404-1261

[2020] NZHC 3079

IN THE MATTER

Of the Property Law Act s 316

BETWEEN

ESTUARY CHT LP

Applicant

AND

MAYALL PROPERTY GROUP LIMITED

First Respondent

AUCKLAND COUNCIL
Second Respondent

DDL HOMES ORMISTON LIMITED
Third Respondents

TSAN FAI LO, CAN RONG LUO and WEI ZHU ZENG

Fourth Respondents

On the papers:	At Auckland
Judgment:	23 November 2020

JUDGMENT OF POWELL J

This judgment was delivered by me on 23 November 2020 at 4 pm pursuant to R 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Solicitors/Counsel:

Phillip Wong & Ben Bong, Highland Park David Wilson, Barrister

ESTUARY CHT LP v MAYALL PROPERTY GROUP LIMITED [2020] NZHC 3079 [23 November 2020]

[1]    The applicant, Estuary CHT LP, seeks the removal of a covenant from land it owns at 200 Flatbush School Road, Flatbush, (Identifier: NA 99D/949, North Auckland Land Registry) (“the land”). The application is made pursuant to s 316(1) of the Property Law Act 2007. The powers of the Court to deal with such applications are then set out in s 317 which provides:

317 Court may modify or extinguish easement or covenant

(1)        On an application (made and served in accordance with section 316) for an order under this section, a court may, by order, modify or extinguish (wholly or in part) the easement or covenant to which the application relates (the easement or covenant) if satisfied that—

(a)the easement or covenant ought to be modified or extinguished (wholly or in part) because of a change since its creation in all or any of the following:

(i)the nature or extent of the use being made of the benefited land, the burdened land, or both:

(ii)the character of the neighbourhood:

(iii)any other circumstance the court considers relevant; or

(b)the continuation in force of the easement or covenant in its existing form would impede the reasonable use of the burdened land in a different way, or to a different extent, from that which could reasonably have been foreseen by the original parties to the easement or covenant at the time of its creation; or

(c)every person entitled who is of full age and capacity—

(i)has agreed that the easement or covenant should be modified or extinguished (wholly or in part); or

(ii)may reasonably be considered, by his or her or its acts or omissions, to have abandoned, or waived the right to, the easement or covenant, wholly or in part; or

(d)the proposed modification or extinguishment will not substantially injure any person entitled; or

(e)in the case of a covenant, the covenant is contrary to public policy or to any enactment or rule of law; or

(f)in the case of a covenant, for any other reason it is just and equitable to modify or extinguish the covenant, wholly or partly.

(2)An order under this section modifying or extinguishing the easement or covenant may require any person who made an application for the order to pay to any person specified in the order reasonable compensation as determined by the court.

[2]    Having considered the application and the evidence adduced in support, it is clear that the covenant in question should be extinguished. The covenant in question provides:

“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:-

(i)use the land first described or permit the same to be used/or 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 wiring of Aylesury 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... "

[3]    The covenant was placed onto the land in 1973 at the time it and surrounding land was being subdivided into smaller lifestyle blocks, with the covenant applying to all of the titles then created. As was apparent from the final section of the covenant it was never intended to have ongoing effect once “all the land in the said Plan shall have been zoned residential or otherwise”.

[4]    As it happened, since that initial subdivision the character of the whole area has fundamentally changed and indeed the covenant has in fact been removed from a number of the properties originally subject to it. The Flatbush area, including the land, is now almost all residentially zoned apart from small areas of reserve land, with Flatbush now a residential suburb.

[5]    Given this position, and noting that there is no opposition to the order sought, it is clear that the grounds set out in s 317(1)(a) and (b) are clearly made out.

[6]I therefore make the following order:

The land covenant created by Transfer 230833.1 from the Title to land at 200 Flatbush School, Flatbush, Auckland (Identifier NA99D/949, North Auckland Land Registry) is extinguished.

[7]There is no issue as to costs.

Powell J