Mikitasov v Little - [2013] NZCA 604

IN THE COURT OF APPEAL OF NEW ZEALAND

CA444/2013
[2013] NZCA 604

BETWEEN

IGOR MIKITASOV
Applicant

AND

ALFRED NEWTON LITTLE
First Respondent

JAMES LOUIS VEZEY, MAHMOOD KHAN AND KAYE THERESA VEZEY

Second Respondents

Court:

Randerson, French and Miller JJ

Counsel:

Applicant in Person
R C Mark for Respondents

Judgment:

(On the papers)

2 December 2013 at 11:30 am

JUDGMENT OF THE COURT

AThe application for special leave to appeal is dismissed.
BThe applicant must pay costs to the respondents for a standard application on a band A basis.

____________________________________________________________________

REASONS OF THE COURT

(Given by Randerson J)

Introduction

The applicant applies for special leave under s 67 of the Judicature Act 1908 to appeal against a decision of Duffy J given in the High Court at Whangarei.[1] By that decision, Duffy J dismissed an appeal against a judgment of Judge McElrea in the District Court in relation to the extinguishment of an easement over the applicant’s property.[2]
[1]Mikitasov v Little [2012] NZHC 1100, (2012) 13 NZCPR 271.
[2]Mikitasov v International Recruitment Partners Ltd DC Kaikohe CIV-2010-027-31, 22 July 2011, recalled and reissued on 15 August 2011.
The applicant sought leave in the High Court to appeal to this Court against Duffy J’s decision but his application was declined by Allan J.[3]

Background

[3]Mikitasov v Little [2012] NZHC 1340.

The applicant owns a property in the Bay of Islands that was subject to a right of way in favour of nine other properties. The relevant easement had been granted originally to provide access to an esplanade reserve by the owners of nearby properties. Over time, the physical access had become obstructed and unusable for practical purposes.
The applicant applied to the District Court for an order under s 317 of the Property Law Act 2007 extinguishing the easement. There was no opposition from the holders of the dominant tenements but two of them, the respondents, sought reasonable compensation under s 317(2).
Judge McElrea made an order extinguishing the easement and ordered Mr Mikitasov to pay compensation to each of the respondents in the sum of $12,000. In doing so, the Judge applied the principles discussed by this Court in Jacobsen Holdings Ltd v Drexel, a case dealing with access to landlocked land.[4] Judge McElrea found that the principles adopted in that case for the assessment of compensation were equally applicable in cases involving the extinguishment of easements. In Jacobsen Holdings, this Court held:[5]
Under the section the Court is not bound to award compensation, but usually it will be equitable between the parties to do so and to assess it on the footing of what a willing grantor and grantee of the easement or vendor and purchaser of the fee simple would agree in friendly negotiation.
[4]Jacobsen Holdings Ltd v Drexel [1986] 1 NZLR 324 (CA).
[5]At 329.
Judge McElrea found that the extinguishment of the easement was a real benefit to the applicant and, correspondingly, a real detriment to the respondents.

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.

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Details

Case: [2013] NZCA 604
Decision Date: 2 December 2013 at 11:30 am

CaseChat Overview and Summary

The Court of Appeal of New Zealand heard an application for special leave to appeal by Igor Mikitasov against a decision of the High Court dismissing his appeal against a judgment of the District Court regarding the extinguishment of an easement over his property. The appeal sought to challenge the application of certain legal principles to the assessment of compensation under s 317 of the Property Law Act 2007. The central legal issues were whether the principles from Jacobsen Holdings Ltd v Drexel should be applied without modification to the assessment of compensation under s 317 and whether reasonable compensation requires identification of a loss to an affected party without considering any benefit to the applicant.

The Court of Appeal found that the District Court and High Court had appropriately applied the Jacobsen Holdings principles to the assessment of compensation. The Court held that the principles of Jacobsen Holdings, which consider the willing buyer/willing seller assessment, were suitable for determining compensation in cases of extinguishing easements. The Court further reasoned that the District Court's assessment took into account the prospective benefits and losses to both parties, and it was not reasonably arguable that the Court needed to first consider whether the respondents had suffered any loss. Consequently, the Court of Appeal dismissed the application for special leave to appeal and ordered the applicant to pay costs to the respondents.

Orders