Johns Road Horticultural Limited v Gavin
[2022] NZHC 1747
•20 July 2022
IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY
I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE
CIV-2021-409-000346
[2022] NZHC 1747
UNDER THE Sections 316 and 317 of the Property Law Act 2007 IN THE MATTER
of an application for modification of a Land Covenant
BETWEEN
JOHNS ROAD HORTICULTURAL LIMITED
First Applicant
AND
STUART JOHN VINCENT FOX and SUSAN JOY FOX
Second Applicants
AND
DEREK JOHN CRAZE and
ROBERT AVERILL FITZHARDINGE KINGSCOTE
Third Applicants
See next page
Hearing: On the papers Counsel:
S D Munro and A L Davidson for the First Applicant C J Egden and E Flaszynski for the Second Applicants
S Caradus and E Tomblin for the Third and Fourth Applicants J Moss for the First and Second Respondents
Judgment:
20 July 2022
JUDGMENT OF NATION J
JOHNS ROAD HORTICULTURAL LTD v GAVIN [2022] NZHC 1747 [20 July 2022]
AND ANITA TEOFILA BATEMAN, STEPHEN NOEL BATEMAN and RONALD DAVID WILLIAMS
Fourth Applicants
AND
CHARLOTTE TERESA GAVIN
First Respondent
AND
INVESTMENT SOUTHLAND LIMITED
Second Respondent
AND
JOHN and LYNDA POWELL
Third Respondents
AND
DEVONDALE NURSERIES LIMITED
Fourth Respondent
AND
JURGEN SUPPAN
Party directed to be served
[1] The first to fourth applicants (the applicants) own land in a subdivision adjoining Johns Road on the northern outskirts of Christchurch city. They seek orders modifying a covenant over their land. Notices of opposition were filed as to the original application by the first and second respondents (collectively referred to as “the Gavins”) and the third and fourth respondents (collectively referred to as “the Powells”).
[2] The applicants also sought leave, under r 19.5 of the High Court Rules 2016, to bring these proceedings by way of originating application. That application has not been opposed.
[3] Agreement has been reached between the applicants and the Gavins as to how the relevant covenant should be modified. The Powells did not wish to be heard further as to their original objection.
[4] A hearing of the proceedings had been scheduled for 18 May 2022. On being advised of the position taken by the Powells and the agreement reached between the
applicants and the Gavins, I agreed to deal with the application based on the affidavits and written submissions already filed. Later, I asked counsel to file memoranda as to two issues. They have done so. I refer to those memoranda in this judgment.
Background
[5] The land affected by the covenant was part of a subdivision undertaken in about 1988 by Devondale Estates Ltd, a company associated with the Powells.
[6] The applicants each own properties which are subject to the covenant. Their land adjoins Lot 20. With other adjoining landowners, they own a share in Lot 20. The Gavins and the Powells also own land adjoining Lot 20 and shares in Lot 20.
[7] A number of the landowners who have a share in Lot 20 own properties within a gated community known as the Devondale Estate. They have access to their properties from Lot 20. These people refer to Lot 20 as comprising the driveway and the farm track.
[8] The covenant over Lot 20 imposes obligations on the property that are subject to the covenant as follows:
(a) any dwelling house erected on any of the lots subject to the covenant must be:
(i)architecturally designed by a local registered architect, and Devondale Estates Ltd (or its agent) must approve the architectural plans prior to building commencing (the architectural design restriction); and
(ii)erected no lower than 10 metres above sea level, with no garages or accessory buildings erected below nine metres above sea level (the building height restriction);
(b) fencing must be natural, comprising only of shrubs and/or trees (the fencing restriction).
[9] Devondale Estates Ltd developed 12 land packages as part of the Devondale Estates Development. Each comprised one residential lot and one large horticultural lot. These were to be operated as an apple orchard together with the other Devondale Estates Development purchasers. The applicants’ properties, bar a residential property owned by the second applicant, are the larger horticultural lots originally used as apple orchards.
[10] Since registration of the covenant in 1988, the applicants’ properties and Lot 20 have undergone significant zoning changes, transitioning from a rural zone to residential around 2012. Under the current Christchurch District Plan, which became operative in December 2017, the applicants’ properties have been further rezoned to “residential new neighbourhood” with a portion of the first applicant’s properties rezoned to “commercial core”. The residential new neighbourhood zone allows for large-scale residential development, with a wide range of residential house types and section sizes. However, it generally requires higher density housing than has traditionally been provided for in suburban subdivisions. The rezoning took place on a “notified” basis so people potentially affected could make submissions on the proposed changes.
[11] The first applicant wishes to proceed with further intensive subdivision of its properties, primarily for residential use, consistent with the current zoning of its land. It considers the covenant is an impediment to it doing so. The second, third and fourth applicants agreed to join the first applicant in the application to remove the covenant over the applicants’ land and part of Lot 20 excluding as much of the area as possible that is used by other landowners to access their land.
[12] In the original application, the applicants sought modification of the covenant so that their land would not be subject to the covenant. They sought the modification on the grounds:
(a) the covenant was registered to maintain the overall aesthetic of a rural residential subdivision in proximity to the applicants’ properties;
(b) at the time the covenant was registered, the applicants’ properties were zoned rural and used for orchards, and were not used for residential subdivision; and
(c) it could not have been intended that the applicants’ properties and Lot 20 would be subject to the covenant.
[13] The Devondale Estate has its own private amenities including full roading, walking and cycling tracks, a children’s playground, tennis court, security gate and private water bore. The Devondale Estate Owners Society Incorporated exists to preserve and promote the amenities of the Devondale Estate to ensure the Devondale Estate retains its character primarily as a quality, open, park-like residential area.
[14] Charlotte Gavin has lived in the Devondale Estate for over 20 years and was influential in setting up the Devondale Estate Owners Society Incorporated. Ms Gavin and Investment Southland Ltd own three properties within the Devondale Estate and a share of Lot 20.
[15] David Wilson swore an affidavit in support of the original application. He is a development manager contracted by the first applicant to manage the development of the first applicant’s properties. These properties are primarily for urban/residential use but some specific parts are earmarked and zoned for commercial development. It was Mr Wilson’s evidence that the first applicant’s ability to develop the subdivision would be greatly impeded if it remains subject to the covenant. The proposed subdivision would be for residential sections in a modern residential subdivision with a variety of housing styles. These would include medium density housing, as required by the zoning provision of the district plan. Mr Wilson considered potential purchasers of such sections would likely be deterred by the fencing restrictions, which would result in limited privacy and security. He also considered the fencing restriction in the covenant would make compliance with health and safety legislation impossible during the construction of any buildings given that any fencing required to protect the building sites, including temporary fencing, would fall foul of the covenant.
[16] David Wilson provided evidence as to the zoning changes which have affected the applicants’ land. He noted that the part of Lot 20 the applicants wished to have released from the covenant was entirely located in the residential new neighbourhood zone.
[17] As to the architectural design restriction, Mr Wilson referred to the fact Devondale Estates Ltd was removed from the companies register on 28 March 1997. It therefore no longer exists and cannot approve architecturally designed plans in a manner that was required by the architectural design restriction.
[18] As to the height restriction, Mr Wilson provided evidence that minimum floor heights were no longer necessary because these are now prescribed by the Christchurch District Plan and Building Act 2004, particularly as to properties that are within a flood management area according to the plan. Those properties not within a flood management area have to comply with the Building Code which requires that buildings be protected from a one in 50 year flood.
[19] Mr Wilson referred to independent civil engineering advice that had been provided to the first applicant as to its proposed subdivision. The engineer had indicated that he did not expect the flood management area to be of relevance to the site once development had been completed in accordance with its subdivision consent. This was because site levels had to be raised through earthwork activities to above the level required within a flood management area. It was his evidence that the Council would be unlikely to grant a subdivision consent to the other applicants unless they raise the site level to match the first applicant’s. It was Mr Wilson’s evidence that, for these reasons, the building height restriction had become redundant.
[20] Mr Wilson expressed the opinion that the restrictions in the fencing restriction had also become redundant because of the particular fencing obligations that now applied to the applicants’ properties through the Christchurch District Plan.
[21] Mr Wilson noted that Lot 20 was always to be used to facilitate access and services. The covenant was intended to maintain the “overall aesthetic quality” of the Devondale Estate residential subdivision. Given that Lot 20 had always been used for
access and services, Mr Wilson said he struggled to understand why the land in Lot 20 had ever been subject to the covenant and suggested it had been included within the scope of the covenant in error.
[22] Mr Wilson detailed the way in which different solicitors for the applicants had communicated with the owners of all the properties subject to the covenant, seeking their consent to the modification of the covenant so the applicants’ properties would not be subject to its restrictions. Mr Wilson noted that a number of those owners indicated they would not consent to the proposed modification. He pointed out, with reference to relevant correspondence, and I accept, that none of the owners expressly objected to the modification of the covenant on the basis they wanted the fencing restriction, building height restriction or architectural design restriction to remain enforceable against the subject properties.
[23] By memorandum dated 4 August 2021, counsel for the applicants sought directions for service on those owning adjoining land as set out in a schedule attached to the memorandum. It referred to 18 parties who own (or partly own) lots bound by the covenant.
[24] On 3 September 2021, Associate Judge Paulsen directed that the applications to modify the land covenant and for leave to commence the proceedings by way of originating application be served on all persons owning land subject to the covenant.
[25] Through an affidavit of Emma Skudder of 1 October 2021, I am satisfied that 14 of the 18 affected owners agreed to accept service of the required documents, including a detailed affidavit from Mr Wilson, by email and were served with the documents in that manner on 13 September 2021. With the agreement of the Christchurch City Council, that Council was also served with the documents by email on 13 September 2021.
[26] I am satisfied by affidavit evidence that the remaining four parties were served personally with the required documents on 14 and 29 September 2021.
[27] The only parties served who filed notices of opposition were the Gavins and the Powells. Counsel for another resident filed a memorandum dated 5 October 2021. Counsel advised that this resident had not yet had an opportunity to provide full instructions to his counsel on the matter and agreed to an adjournment proposed by other parties, but sought directions extending the timetable for the filing of his opposition and affidavit evidence. Directions were made accordingly. No notice of opposition was filed for him. No notice of opposition was filed for the Christchurch City Council.
[28] In her affidavit, Ms Gavin referred to her involvement with the Devondale Estate for over 20 years. She said that her interest in the matter, both personally and through the second respondent, was through their owning properties within the Devondale Estate. She explained the Devondale Estate has 15 resident owners. An incorporated society was established in 2012 to preserve and promote the amenities of the Devondale Estate. Ms Gavin played a large part in establishing the society and had continued to play a role as secretary and chairperson at different times. Her husband had also been chairperson of the society and a primary contact to monitor the maintenance and security of the farm track and driveway. Ms Gavin said members of the society are subject to the rules of the society. The rules provided that:
No fencing shall be permitted that is:
·Fronting the estate driveway;
·Within ten (10) metres of the estate driveway;
·Protruding beyond the main building line and / or
·Greater than 1.8 metres in height;
with the exception of swimming pool fencing, that is in accordance with Council regulations (providing that the 10 metre setback from the estate driveway is observed).
[29] In her affidavit, Ms Gavin said she was not objecting to the removal of clauses 1 and 2 of the covenant (the architectural design and building height restrictions) as they no longer served any significant purpose. Her concerns were as to the “unrestrained erection of fences on and around the estate by the developers” and the way that could impair what she said was the open park-like character and unobstructed rural vistas from and around the estate. She was concerned that landowners with a
share in Lot 20 would potentially have to share equally the cost of fences constructed along property boundaries, but members of the society would have more obligations for maintaining the fence. Ms Gavin said this disparity could create discontent. She was also concerned about the potential for fencing on the farm track and driveway to create a “corridor” for public access, with an increased risk of vandalism and crime. She was concerned that, with the proposed subdivisions, there could be another 500 shareholders to the area which would make decision-making over the farm track accessway “extremely problematic”. She was concerned particularly that fencing might be erected between the Gavins land and the buffer area if the covenant was removed.
[30] In a supplementary affidavit, Ms Gavin indicated that at a meeting of the Devondale Estates Owners Society Incorporated on 9 March 2022 she discussed her opposition to the application. She said her opposition was supported by 75 per cent of the residents of the Devondale Estate, including her mother but not her father.
[31] The notice of opposition filed by the Powells opposed all the orders sought in the application. However, the affidavit of John Powell dated 4 March 2022 focused only on the fencing restriction and the potential effect removal of that restriction might have on the security and maintenance of part of Lot 20.
[32] On 9 May 2022, counsel for the Powells filed a memorandum. Counsel said the Powells’ opposition primarily stemmed from safety and security concerns with how the driveway would be used. They noted that the Gavins had proposed a new covenant that would ensure:
To the extent that fencing is erected along the common boundaries to their properties and Lot 20, then:
(a) that fencing will be permeable, open rail, swimming pool style fencing, to a maximum height of 1.8m above finished ground level;
(b) the costs to construct and maintain the permeable fencing will be met by the First or Fourth Applicant (subject to expiry conditions);
(c) there will be a 2m building setback from the common boundaries; however
(d) no recession plain applies.
[33] Counsel for the Powells indicated they understood the first to fourth applicants had agreed the covenant should be modified in line with the proposed new covenant.
[34] Counsel said the Powells did not propose to join them in agreeing with this new covenant “unless and until the Christchurch City Council clarifies and agrees the use of the farm track”. Nevertheless, counsel said the Powells “do not wish to take an active role in this proceeding given their position and leave is sought for submissions and appearances of their counsel to be excused”. Such leave was granted.
[35] Mr Wilson filed an affidavit responding to the concerns raised by Ms Gavin and by Mr Powell in his affidavit.
[36] Mr Robert Kingscote is one of the third applicants as a trustee of the estate which owns land, in part, across from the Gavins land and a 1/24 share of Lot 20. In his affidavit he responded to the concerns raised by Ms Gavin and Mr Powell insofar as those concerns related to the third applicants’ land and the driveway on its western boundary.
[37] In the affidavits, there was evidence as to continuing negotiations between the parties involved in the proceedings.
[38] On 12 May 2022, counsel for the applicants and the Gavins filed a joint memorandum. In that memorandum, the Gavins agreed that replacement covenants proposed by the first, third and fourth applicants, as detailed in the affidavit of David Wilson in reply dated 31 March 2022 and exhibit C of the affidavit of Robert Kingscote dated 1 April 2022, were appropriate.
[39] In that memorandum, the applicants and the Gavins referred to the memorandum dated 9 May 2022 in which the Powells indicated they would not agree to the replacement covenants “unless and until the Christchurch City Council clarifies and agrees the use of the farm track”.
[40] Counsel for the applicants and the Gavins responded in their memorandum that:
(a) any perceived issues regarding the use of the farm track were irrelevant to the application;
(b) the Court should apply limited weight to the concern given there had been no explanation as to what clarification was required from the Christchurch City Council or how this was relevant to the application;
(c) the Christchurch City Council had been served with the application on 13 September 2022, had not responded to the application and, if it had any concerns, would be able to deal with them outside the scope of the application; and
(d) the replacement covenants are a reasonable solution that addresses the nature of the concerns raised by the third and fourth respondents (to the extent they had any merit) and those respondents had not provided any explanation as to why the rules proposed by the applicants in the replacement covenants are not reasonable or acceptable.
[41] In their memorandum, the applicants and the Gavins agreed to the proposed modification of the existing covenant and the contemporaneous registration of the replacement covenants. They agreed that such a step would appropriately resolve both the applicants’ application for modification and the Gavins opposition to the application. The applicants and the Gavins agreed this would be achieved through the making of a revised draft order as had been provided to the Court. That order requires the registration of the replacement covenant contemporaneously with the agreed modification of the existing covenant.
[42] With that memorandum, those parties, through their counsel, submitted it would be appropriate for the scheduled hearing to be vacated and the revised orders to be granted on the papers. They also asked for costs to lie where they fall.
[43] In response to that memorandum, I vacated the hearing. As requested by the Powells, I gave leave for them to not file submissions or appear at the hearing. I said I would not, at that point, make the orders as sought because that would have to be the subject of a judgment. This is that judgment.
Leave to commence proceedings by originating application
[44] I consider it was appropriate for these proceedings, under ss 316 and 317 of the Property Law Act 2007, to be brought by way of originating application. The context for the application is factually straightforward. There is no need for particularised pleadings, nor was or is there likely any need for interlocutory applications. The issues were covered fully in the originating application and the supporting documentation. The High Court has, in several instances, said the omission of applications such as this from the list of applications that can be brought as an originating application was probably an oversight.1
[45] The legal context is straightforward. As agreed by the applicants and the Gavins, there have been a significant number of cases where the courts have granted leave for applications under ss 316 and 317 to be brought by originating application.2
Modification of covenants – legal principles
[46] These principles were recently succinctly summarised by Gault J in Taurikura Holdings Ltd v Tauranga City Council.3 I respectfully adopt that summary:
[20]Sections 316 and 317 of the [Property Law Act] provide:
316 Application for order under section 317
(1) A person bound by an easement, a positive covenant, or a restrictive covenant (including a covenant expressed or implied in an easement) may make an application to a court for an order under section 317 modifying or extinguishing that easement or covenant.
(2) That application may be made in a proceeding brought by that person for the purpose, or in a proceeding brought by any person in relation to, or in relation to land burdened by, that easement or covenant.
(3) That application must be served on the territorial authority in accordance with the relevant rules of court, unless the court directs otherwise on an application for the purpose, and must be served on any other persons, and in any manner, the court directs on an application for the purpose.
1 Re Marriner Property Ltd [2020] NZHC 1747 at [31]; and Wang v Auckland Council [2021] NZHC 499 at [8].
2 See LMM Investments 2012 Ltd v Cumming [2021] NZHC 2639 at [10]-[14]; Taurikura Holdings Ltd v Tauranga City Council [2022] NZHC 994 at [17]-[19]; Re Baigent [2021] NZHC 2478; Fair v Fair [2019] NZHC 2349, (2019) 20 NZCPR 652 at [24]-[27]; Land Depot Ltd v Friese [2020] NZHC 1085; Re Marriner Property Ltd, above n 1; Wang v Auckland Council, above n 1.
3 Taurikura Holdings Ltd v Tauranga City Council, above n 2.
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.
[21]A court in this context includes the High Court exercising originating jurisdiction.4
[22]Turning to the Court’s approach in s 317 cases, in Synlait Milk Ltd v New Zealand Industrial Park Ltd, the Supreme Court said:5
4 Sutherland v MacAlister (2010) 11 NZCPR 732 (HC).
5 Synlait Milk Ltd v New Zealand Industrial Park Ltd [2020] NZSC 157, [2020] 1 NZLR 657.
[67] The cases on s 317 generally adopt a two-stage approach. The court’s first task is to determine whether one (or more) of the grounds in s 317(1) is made out. If one (or more) of the grounds in s 317(1) is made out, the second task is to determine whether the discretion to extinguish or modify the covenant should be exercised. We adopt that approach. We acknowledge, however, that if the court finds one or more of the grounds in s 317(1)(a) is engaged, it will have found that (using the words of s 317(1)(a)) “the easement or covenant ought to be modified or extinguished (wholly or in part)”, which may bring into play at the first stage some of the considerations that are also relevant at the second stage.6
[23]Having considered the effect of the legislative broadening of the statutory power, the Supreme Court said it would not overlay the requirements of s 317 with additional, non-statutory criteria that have the effect of altering the clear parliamentary intention that easements and covenants should be amenable to modification or extinguishment in defined circumstances.7
[24]The Supreme Court concluded that the exercise of the discretion to modify or extinguish the easement or covenant requires consideration of all relevant factors (including the power to award compensation). The Court did not see any intent that any one factor should be disqualifying.8
[47] The applicants and the Gavins agree that the covenants should be modified in the way they propose because of:
(a) a change since the covenant’s creation in the nature or extent of the use being made of the benefited and/or burdened land, and a change in the character of the neighbourhood;
(b) the modifications proposed by the applicants would not substantially injure any person entitled to enforce the covenant; and
(c) it is otherwise just and equitable to modify the covenant as sought.
[48] I accept there has been a change since the covenant’s creation and the nature of the use being made of the benefited and/or burdened land, and a change in the character of the neighbourhood.
6 Similarly, if the court found s 317(1)(f) was engaged, it would have determined that it was just and equitable to modify or extinguish the covenant. That too may bring into play at the first stage some of the considerations that are also relevant at the second stage.
7 At [85].
8 At [90].
[49] As discussed above,9 most of the applicants’ land was originally rurally zoned and used as an apple orchard. The covenant was then in place to maintain the “overall aesthetic quality” of the subdivision. I accept that, with the rezoning of the land into the “residential new neighbourhood” and “commercial care” zones, there is an increased need for fencing to provide privacy and security for owners and occupiers as the land is more densely developed.
[50] I am satisfied the modifications proposed by the applicants and agreed to by the Gavins would not substantially injure any person entitled to enforce the covenant.
[51] The architectural design restriction in the covenant was of no practical value. As to that restriction, the covenant could be enforced only through requiring the company Devondale Estates Ltd to approve plans before building commenced. Devondale Estates Ltd no longer exists.
[52] The building height restriction was no doubt required as part of the original subdivision to ensure that any building adequately took account of flood risk. As discussed above,10 minimum floor levels in the area of the subject properties will now be mandated by the Christchurch District Plan and the Building Code.
[53] The removal of the architectural design and building height restrictions in the existing covenant over Lot 20 will not alter the way the land in Lot 20 can be used. As an accessway, it would never have been built on. Lot 20 will still be used for that purpose.
[54] Initially, the Gavins and the Powells were concerned that the removal of the fencing restriction would detract from the visual amenity of Devondale Estate, its open park-like character and unobstructed rural vistas. The evidence however indicates that the entire area subject to the covenant is not going to remain rural in nature and outlook. It is going to be subject to a medium-density residential development where it is standard for lots to be fenced. The residential new neighbourhood rules in the District Plan contemplate the possibility of fencing for this type of development.
9 Above at [10].
10 Above at [18] and [19].
[55] Despite that, Mr Kingscote’s evidence is that the operative District Plan preserves a 15 m setback from the Devondale driveway and the area within the setback must include a consistent design of permeable fences and the placement of key trees and shrubs. Mr Kingscote’s evidence was that the sealed part of the driveway is approximately five to six m wide, and meanders along the width of Lot 20 which is approximately 20 m wide. Combined with the 15 m setback on both sides of the driveway, in the setback area there would be an approximate width of open space along the driveway of 50 m or so. On that area, there are large trees as well as areas of grass lawn.
[56] The rules of the Devondale Estate Owners Society Incorporated prohibit fencing, except for swimming pool fencing that complies with the driveway setback, that:
(a) fronts the Devondale Estate driveway;
(b) is within 10 m of the estate driveway;
(c) protrudes beyond the main building line; and/or
(d) is greater than 1.8 metres in height.
[57] I agree that the inference to be drawn from the society’s rules is that residents of the estate, through the society’s rules, accept that fencing that complies with the driveway setback requirements and is only 1.8 m in height (except for swimming pool fencing) will not significantly detract from the visual amenity they enjoy with their properties. The Gavins’ concern, supported by a number of residents in the Devondale Estate, was that solid fencing between the driveway and residential properties would affect the visual amenity of the Devondale Estate. That potential loss of amenity will be mitigated to an extent acceptable to the Gavins through the modification of the covenant as now proposed. I infer that if the modification now proposed adequately addresses the Gavins concerns in this regard, it will also address the concerns of other residents of the Devondale Estate who supported Ms Gavin’s concern but did not file notices of opposition to the application.
[58] Any fencing constructed on the common boundaries to the applicants’ land and Lot 20 will be permeable, open-rail, swimming-pool-style fencing, constructed to a maximum height of 1.8 m above finished ground level. There will be a two metre building setback from the common boundary.
[59] The Gavins were concerned that the owners of all properties who have a share in the driveway could be called upon to contribute to the cost of fencing between the driveway and the residential lots to be developed on the applicants’ land. With the modification proposed, the applicants agree that they will be responsible for all costs of fencing between the driveway and the applicants’ land.
[60] If orders are made as sought by the applicants, other landowners who currently have the benefit of the covenant will be able to have the new modified covenant registered in respect of properties so they can have the benefit of the modified covenant in all respects, including the applicants’ agreement to meet the costs of installing and maintaining the stipulated fencing.
[61] The Gavins and the Powells had expressed a concern that allowing fencing along the driveway would have the potential to create a corridor for public access and increase the potential for vandalism and crime. I accept that any such potential risk will be mitigated through the requirement for fencing along the driveway to be a permeable, swimming-pool style. Subject to how such fencing might be screened through planting (which would be permitted with the covenant as it currently exists) and with the proposed modification, those using the driveway will be within view of neighbouring residences.
[62] With the agreement that has been reached, I am satisfied the modification of the covenant will not substantially injure any person in the ways the Gavins and the Powells, in their affidavits, initially suggested would be possible or likely.
[63] I am also satisfied that it would be just and equitable for the covenant to be modified in the manner proposed.
[64] As explained above, the Powells opposed the applications, but only raised concerns about the fencing restriction. In their memorandum of 9 May 2022, counsel for the Powells said they did not propose to join the applicants and the Gavins in agreeing with the new covenant “unless and until the Christchurch City Council clarifies and agrees the use of the farm track”. The Powells had not put any evidence before the Court as to how the Council’s approval as to the use of the farm track was relevant to the matters the Court had to consider in considering the application to modify the existing covenant. It is difficult to see how any decision of the Christchurch City Council as to the use of Lot 20, including the farm track, could be relevant to whether the building height restriction, the architectural design restriction and the fencing restriction should remain over Lot 20 of the applicants’ land.
[65] The application has been made on the basis Lot 20 will continue to be used for access and utility services for adjoining land, as was the case when all this area was originally subdivided and the covenant was created. Although it can only be speculation, it is possible Mr Powell wants the Council to commit to having the driveway and farm track land vest in the Council to avoid the complications that will exist if the driveway and farm track land are owned in shares by all those who have residential properties benefiting from the land with maintenance obligations associated with that. If that is his concern, it would not be relevant to the Court in deciding whether the modification to the covenant now sought should be permitted as allowed for under ss 316 and 317 of the Property Law Act.
[66] In a minute of 1 June 2022, I sought a submission from counsel as to why the proposed modification would respond to the concern of others in the Devondale Estate as conveyed in the letters of support attached to Ms Gavin’s second affidavit.
[67] Counsel for the applicants’ primary submission was that those property owners had been served with the proceedings and had elected not to engage in them. They had not engaged Ms Gavin as their representative. In those circumstances, the applicants’ submitted it would be unreasonable to require the applicants to engage with those property owners over the proposed modification and to do so would cause unnecessary delay and cost.
[68] Counsel submitted the proposed modification resolved those concerns. The proposed modification would require a consistent aesthetic and prevent construction of solid fencing along the common boundary. The replacement covenants will prescribe that the applicants will meet the costs of constructing and maintaining the permeable fencing subject to expiry provisions.
[69] Counsel for the Gavins submitted the concession over the fencing covenant, agreed to by the Gavins and accepted by the applicants, did not respond to any of the other residents’ concerns. Counsel said the Gavins did not formally act for the other residents. Counsel said the other residents’ concerns related to public access over the farm track and driveway, their desire for a driveway agreement as to that matter and issues that would arise out of further splitting of shares in Lot 20. Counsel suggested there could be an adjournment of the proceedings for Ms Gavin to convene a meeting of other residents to discuss the issues raised in my minute.
[70] I accept that, to the extent other residents in the Devondale Estate raised a concern in their letters of support as to the aesthetic effect of removal of the fencing restriction covenant as originally proposed by the applicants, those concerns have been met with the modification. In terms of aesthetic effect and any potential security issues, the modification now sought will be more beneficial to other landowners than would have resulted if orders had been made in terms of the application as originally filed.
[71] Counsel for the Gavins has advised that the other property owners in the Devondale Estate have a continuing concern about the further splitting of the ownership of Lot 20 that will be the consequence of the subdivision of adjoining properties. The proposed modification will not however affect rights or obligations as to that.
[72] In my minute, I also raised an issue as to the proposed modification, including a provision that “no recession plane applies”. That had not been part of the modification sought with the application as originally filed and as served. I had thought this was an issue because there had been reference to this in counsel’s memorandum as to the settlement that had been reached.
[73] In the response to my minute, counsel for the Gavins made no reference to this issue and thus did not suggest it would be a matter of concern to the Gavins or other affected landowners.
[74] Counsel for the applicants explained that this had been mentioned as a response to an original proposal by the Powells that there should be a recession plane of 1:3 from the top of the fence. Counsel pointed out that the replacement covenants, for which the Court’s approval is sought, are actually silent as to recession plane rules. Recession planes will be governed by the rules of the Christchurch District Plan.
[75] With that explanation, I accept that, with the proposed modification, no other property owner will be giving up protection, benefits or rights they might have from rules in the Christchurch District Plan as to recession planes that could impact on the way structures might be built on land adjoining Lot 20.
[76] I am accordingly satisfied, with the proposed covenant modifications are less extensive than had originally been sought. The concessions agreed to by the applicants and the respondents still engaged in the proceedings will mean that the modifications sought will be more beneficial from an aesthetic, amenity and cost perspective than had originally been proposed. That being the case, I accept it would cause unnecessary delay and expense for adjoining landowners to have to be given notice of the amended application or for the proceedings to be adjourned for their views as to the modification to be ascertained in some informal way.
Conclusion
[77] I accordingly make orders in terms of the draft orders filed with the High Court on 12 May 2022 except that:
(a) In para 5. – the time for registered owners to confirm in writing to the Registrar-General of Land that they agree to the registration of the Replacement Covenants against their share of Lot 20 will be 20 working days; and
(b) In para 6. – the time for registered proprietors to sign all documents etc. will be 15 working days of receiving notice of such a requirement.
[78]Costs are to lie where they fall.
[79]Leave is reserved to seek further directions from the Court if necessary.
Solicitors:
Anderson Lloyd, Christchurch
Mortlock, McCormack Law, Christchurch Duncan Cotterill, Christchurch
Rhodes & Co., Christchurch.
Copy to:
J Moss, Barrister, Christchurch.
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