Pennington Trust Company Limited
[2022] NZHC 2332
•12 September 2022
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2022-404-1040
[2022] NZHC 2332
IN THE MATTER
AND
of the Property Law Act 2007 Part 6 Subpart 3 Landlocked Land IN THE MATTER
of Registered Proprietor of Record of Title: NA565/251 John Giles
PENNINGTON TRUST COMPANY LIMITED
Applicant
Hearing: 8 September 2022 Appearances:
A Bush for the Applicant
K F Gould for interested party C and B Wheeler
R G Lauder, a person directed to be served, on his own behalfJudgment:
12 September 2022
JUDGMENT OF GORDON J
This judgment was delivered by me
on 12 September 2022 at 4 pm, pursuant to r 11.5 of the High Court Rules
Registrar/Deputy Registrar Date:
Solicitors:
Harold Kidd Law, Auckland DMG Solicitors, Auckland K F Gould, Auckland
Copy to: R G Lauder
PENNINGTON TRUST COMPANY LTD [2022] NZHC 2332 [12 September 2022]
Introduction
[1] Pennington Trust Company Ltd (Pennington) is the registered proprietor of 11 Mozeley Avenue, Devonport, Auckland. This property is only accessible by a right of way easement (the ROW). Although the owners of 11 Mozeley Ave have used the ROW for many years, they do not have a legal right to do so. Pennington now seeks an order under s 328 of the Property Law Act 2007 (the Act), granting reasonable access to 11 Mozeley Ave on the basis that it is otherwise landlocked.
[2] Cecily and Brian Wheeler (the Wheelers) who own and live at 5 Mozeley Ave filed what is styled as a Notice of Opposition. While they did not formally oppose the application, the Wheelers asked that certain conditions be imposed if the application was granted. Their position at the hearing was that provided the Court is satisfied it has jurisdiction to make the order they do not oppose the application. At the hearing Mr Gould, counsel for the Wheelers, abandoned the request for conditions to be imposed as set out in the Notice of Opposition. But he asked that the Court emphasise one matter which I will come to in due course.
[3] The registered proprietors of 13 Mozeley Ave, Robert Lauder, Erica Lauder and Cameron Drew, filed an appearance reserving rights. Their property does not have the legal benefit of the right of way. Mr Lauder appeared at the hearing. He supports the application but did not seek to make any submissions.
[4] At the commencement of the hearing counsel for Pennington, Mr Bush, indicated that he wished to amend the application to include services, namely the right to convey electricity, telecommunications, water and gas, and drain stormwater and sewage. After discussion with the Court and acknowledging that others who have the legal benefit of the right of way did not have notice of the proposed amendment, Mr Bush did not pursue the application to amend.
[5]The hearing accordingly proceeded on the basis of the application as filed.
Background
[6] On 17 June 1881, the ROW was created for the benefit of five properties (not including 11 Mozeley Ave) by virtue of a deed of conveyance 70553 (E1/832) over record of title NA565/251. The registered proprietor of NA565/251 was and continues to be John Giles. His successors appear to have abandoned the land. The solicitors for Pennington endeavoured to trace the owners through the Auckland City Council rating records but without success.
[7] Both the ROW and 11 Mozeley Ave were brought under the land transfer system by the Land Transfer (Compulsory Registration of Titles) Act 1924.
[8] Warwick and Jocelyn Pennington purchased 11 Mozeley Ave on 26 April 1996. It was later transferred to the Pennington Trust Company Ltd, which was registered on 2 November 2010. The Penningtons’ daughter, Angela Shafer, who is a director of Pennington, says in her affidavit in support of the application that at the time of purchase, her parents erroneously believed that the ROW existed in their favour. It appears that previous owners of the property, which was built around 1910, operated under a similar misapprehension. Mr Wheeler says in his affidavit that through his discussions with the Penningtons they were aware that they did not have rights over the right of way. However, it is not clear when those discussions occurred.
[9] Pennington would now like to sell 11 Mozeley Ave. Mr Pennington is now deceased and Mrs Pennington has recently moved into a residential care facility. Having been alerted to the absence of a legal right of access by a real estate agent, Pennington sought to register the ROW on the record of title for 11 Mozeley Ave through Land Information New Zealand (LINZ). This request was refused by LINZ by letter dated 27 May 2022.
ROW and adjoining parcels of land
[10] The property title for the ROW is NA565/251 (fee simple). The ROW (highlighted yellow) and the relevant titles are illustrated by the diagram below:
[11] The five adjoining parcels of land inside the area outlined in red have the legal benefit of the ROW. They are:
(a)NA565/256 – 1 Mozeley Ave.
(b)632774 – 1A Mozeley Ave.
(c)NA131A/351 – 3 Mozeley Ave.
(d)NA565/254 – 5 Mozeley Ave.
(e)NA565/253 – 19 Lake Road.
[12] Both 1 and 1A Mozeley Ave are physically separated from the ROW, and do not rely on it for access, but still have the legal benefit of the ROW. Both
3 Mozeley Ave and 19 Lake Road adjoin the ROW, but also adjoin a street frontage. 5 Mozeley Ave adjoins the ROW on two sides and relies on the ROW for access.
[13] Further land parcels adjoin the ROW but do not have the legal benefit of it. These properties include:
(a)11 Mozeley Ave, NA565/277.
(b)13 Mozeley Ave, NA565/276.
[14]As already noted the applicant is the registered proprietor of 11 Mozeley Ave.
[15] The registered proprietors of 13 Mozeley Ave are the Lauders and Mr Drew. Number 13 Mozeley Ave is not landlocked, but the property has two parking lots at the rear which require access via the ROW. On 1 December 2017 the Lauders and Mr Drew registered caveat 1094757.1 against NA565/251 (the land containing the ROW) claiming an equitable easement (implied right of way). No further steps have been taken in relation to the caveat.
Relevant law and legal principles
[16] Landlocked land is governed by Part 6, subpart 3 of the Act, and is defined as “a piece of land to which there is no reasonable access”. Reasonable access is further defined as follows:1
reasonable access, in relation to land, means physical access for persons or services of a nature and quality that is reasonably necessary to enable the owner or occupier of the land to use and enjoy the land for any purpose for which it may be used in accordance with any right, permission, authority, consent, approval, or dispensation enjoyed or granted under the Resource Management Act 1991.
[17] The owner of landlocked land may apply to court for an order granting reasonable access to such land.2 Unless the court directs otherwise, the application must be served on:3
1 Section 326.
2 Section 327(1).
3 Section 327(2).
(a) the owner of each piece of land adjoining the landlocked land; and
(b) every person who—
(i)has an estate or interest in the landlocked land or in any other piece of land (whether or not adjoining the landlocked land) that may be affected by the granting of the application; or
(ii)claims to be a party to, or to be entitled to a benefit under, any instrument relating to land of the kind specified in subparagraph (i); and
(c) the relevant territorial authority.
[18] This Court may grant reasonable access to landlocked land on an application by the owner, subject to certain restrictions as set out in s 328 of the Act. The court must not make such an order over land that is part of a national park,4 a public reserve,5 a railway line,6 or Te Urewera land.7 Further, the court may decline to make an order if it considers that the applicant is entitled, and should be required, to seek relief under Te Ture Whenua Maori Act 1993, the Local Government Act 2002 or any other enactment.8
[19] The Act sets out mandatory considerations for the court in determining an application under s 327:
329 Matters court must consider in determining application for order for reasonable access
In determining an application for an order under section 328, the court must have regard to—
(a)the nature and quality of the access (if any) to the landlocked land at the time when the applicant purchased or otherwise acquired the land:
(b)the circumstances under which the land became landlocked:
(c)the conduct of the parties, including any attempts they have made to negotiate reasonable access to the landlocked land:
(d)the hardship that would be caused to the applicant by the refusal of an order, in comparison with the hardship that would be caused to any other person by the making of an order:
4 Section 328(2)(a): within the meaning of the National Parks Act 1980.
5 Section 328(2)(b): within the meaning of the Reserves Act 1977.
6 Section 328(2)(c): within the meaning of the New Zealand Railways Corporation Act 1981.
7 Section 328(2)(aa): as defined in section 7 of the Te Urewera Act 2014.
8 Section 328(3).
(e)any other relevant matters.
[20] A court may impose on the order any conditions it thinks fit, including payment of reasonable compensation, maintenance of fencing or access way, survey work, and time frames.9
[21] The reasonable costs of any work necessary to give effect to an order must be met by the applicant, unless the court is satisfied, having regard to the mandatory considerations, that it is just and equitable to require any other person to pay the whole or any specified share of the cost, and gives a direction in the order accordingly.10
[22] In Wagg v Squally Cove Forestry Ltd,11 Mallon J summarised the relevant principles on landlocked land, having reviewed leading authorities:
(a) Whether there is reasonable access to land is a question concerned with whether there is practical physical access in fact, rather than whether there is legal access.
(b) It is a question of present fact, concerned with whether reasonable access now exists, not whether (for example) “it is possible to provide access by upgrading existing tracks on the applicant’s own land”.
(c) Access “at the whim of an adjoining owner” or dependent on the “courtesy and goodwill” of the adjoining owner is not reasonable access.
(d) What is reasonably necessary to use and enjoy the land “in accordance with any right ... [unhandled character] consent under the Resource Management Act” is concerned with existing uses, not potential uses for which a land owner could apply for consent.
(e) Reasonable access is not necessarily the same as the best access that could be achieved. Other access may be convenient and reasonable but that does not mean that the access the land presently has is unreasonable.
(f) Whether there is reasonable access is a value judgment that the Court has to make on the basis of the evidence. Factors such as the characteristics of the locality (residential, commercial or mixed), the topography of the area and contemporary transportation requirements are relevant.
(g) The circumstances as they existed at the time the land was acquired may be relevant evidence as indicating what the purchaser regarded as reasonable at that time.
9 Section 330(1).
10 Section 331.
11 Wagg v Squally Cove Forestry Ltd [2012] NZHC 2763, (2013) 13 NZCPR 798 at [60] (footnotes omitted); cited with approval on appeal Squally Cove Forestry Partnership v Wagg [2013] NZCA 463, [2013] 3 NZLR 793 at [23].
(h) Reasonable access does not invariably mean vehicular access, but nowadays the situations in which non-vehicular access will be regarded as reasonable are likely to be few because of the great dependence people now have on motor vehicles.
(i) The legislation is remedial. There is no presumption in favour of non- interference with another title.
Applicant’s position
[23] Pennington says that the ROW has provided access to 11 Mozeley Ave since at least 1881, and possibly prior to that time. The house on the land was built in or around 1910, and other buildings may have existed on the site prior to that date.
[24] Pennington says it can only speculate as to the reason why the ROW does not benefit 11 Mozeley Ave. It suggests that the original owner, Mr Giles, intended to effect a dedication and create a road, but this was never completed.
[25] Mr Bush submits that although Pennington has de facto physical, reasonable access to 11 Mozeley Ave, the property is landlocked land for the purposes of the Act because Pennington currently lacks the legal right to use the ROW.
[26] Mr Bush submits that case law regarding landlocked land and claims for reasonable access has little relevance to the current application which merely seeks to legalise the status quo arising from long term unopposed use and therefore does not interfere with the rights of adjoining owners. Mr Bush submits that the principles summarised by Mallon J (set out above at [22]) reflect applications involving access across another person’s land where this had been opposed by the other landowner.
[27] As regards the mandatory considerations, Mr Bush submits that no physical change to the ROW or the status of access is required. He says it is hard to imagine any credible prejudice to the Wheelers, given they have accommodated the existing arrangement for 24 years. In fact, he says that granting Pennington a legal access right will benefit the Wheelers and the four other registered proprietors who have the benefit of the ROW because any future maintenance or dispute resolution costs (arising under the Act or the Land Transfer Act 2007) will be shared equally with the owners of 11 Mozeley Ave. By contrast there will be significant hardship to Pennington if the
application is refused as its property will be virtually unsaleable or at best would only sell at a significantly reduced price.
The Wheelers’ property
[28]The Wheelers purchased their property at 5 Mozeley Ave in 1980.
[29] On 14 March 1988 a caveat by the Wheelers was registered against NA565/251 (the land containing the ROW) claiming a ROW; in effect preserving the interest they already had by virtue of the deed of conveyance 70553 (E1/832).
[30] On 4 August 2022, the Wheelers filed a Notice of Opposition to this application. It was effectively abandoned at the hearing.
Discussion
[31] The Court of Appeal has held that reasonable access means actual physical access. In Kingfish Lodge (1993) Ltd v Archer, the Court stated:12
In our view the word “physical” was used to place the emphasis upon access in fact. A property owner normally has both a legal right of access and the physical means to exploit it. In exceptional cases there can be one without the other. Paper roads can be physically impassable. Routes which are physically passable are not always supported by strict legal rights. In our view the phrase “physical access” was used in s 129B(1)(c) to make it clear that in this context the factual situation may be decisive.
[32] In that case the applicant, Kingfish Lodge, had effectively conceded that access by sea was adequate for the purposes for which its resource consents had been issued. The Court of Appeal upheld the decision of the High Court that the land was not landlocked.
[33] In the present case, Pennington has physical, vehicle and pedestrian access to their property, but this access is not supported by strict legal rights. In my view, the present case may be distinguished from Kingfish Lodge where there was available legal physical access by sea. There is no available legal physical access in this case.
12 Kingfish Lodge (1993) Ltd v Archer [2000] 3 NZLR 364 (CA) at [26].
[34] Notwithstanding their present de facto access I am satisfied that Pennington’s property is landlocked for the purposes of the statute. As stated in Hinde McMorland and Sim Land Law in New Zealand “There cannot be access, reasonable or otherwise if there is no legal right of any kind to cross the land between the land [and] the public road”.13
[35] Pennington is entitled to make an application under s 327 and has complied with the service requirements.14
[36] I am satisfied that none of the restrictions imposed by s 328(2) of the Act (referred to in [18] above) apply in this case, and Pennington is unable to seek relief under any other enactment. Mr Bush, with his experience in land law, referred to the possibility of Pennington applying to become the registered owner of land by prescription (adverse possession). Such application may be made under ss 150 to 170 of the Land Transfer Act 2017 where a person has been in possession of land for a long time. But as Mr Bush submits, it appears that the statutory provisions apply only as a procedure for obtaining title to land, not easements. Further, it is doubtful that Pennington could be said to have been in ‘possession’ of the land, simply by using it as an accessway.
[37] With regard to the mandatory considerations in s 329, the nature and quality of the access to 11 Mozeley Ave at the time it was purchased was as it stands now: physical access in the absence of a legal right. The current application seeks to remedy the absence of a legal right, rather than the absence of physical access.
[38] The circumstances under which 11 Mozeley Ave became landlocked are not entirely clear. However, it is reasonable to presume that it occurred as a result of an oversight in or after 1881 when the ROW was created.
13 DW McMorland and others Hinde McMorland and Sim Land Law in New Zealand (online ed, LexisNexis)at [16.030].
14 In a Minute dated 6 July 2022 this Court accepted that Pennington need not serve John Giles, the registered proprietor of NA565/251 (being deceased and his successors appearing to have abandoned the title). In a Minute dated 8 August 2022, this Court waived the requirement to serve the owner of 1 Mozeley Ave (being both unavailable and unaffected).
[39] The conduct of the parties, including attempts to negotiate access, is not relevant in the present case, as reasonable access has been available on a de facto basis for many decades.
[40] The Court is required to consider any potential hardship an order might cause. In this case, the monetary value of 11 Mozeley Ave will be reduced if the order is refused. In her affidavit Ms Shafer says it has been made clear to her by real estate agents that 11 Mozeley Ave would be “well-nigh impossible to sell” without there being a legal right to use the right of way. That would cause Pennington serious financial hardship making its asset (11 Mozeley Ave) practically worthless.
[41] On the other hand, the Wheelers had contended that they are adversely affected by parked vehicles obstructing the ROW and damage to the concrete surface of the ROW which they say was caused by contractors employed by Pennington. But as Mr Gould properly acknowledged at the hearing the evidential basis regarding damage to the right of way was insufficient to support the Wheelers’ assertion.
[42] Pennington says it has no knowledge of the damage referred to by the Wheelers or whether or not it was caused by contractors and denies it caused any damage.
[43] But in any event, any damage to the concrete surface of the ROW is not relevant to the present application. It is not a hardship which will be caused to the Wheelers as a consequence of the granting of Pennington’s application. No other matters of hardship were raised by the Wheelers.
[44] Matters of maintenance and use, including obstruction of a ROW by parked vehicles, are governed by Schedule 5(2) of the Act:
Right to establish and maintain driveway
The owners and occupiers of the land for the benefit of which, and the land over which, the right of way is granted have the following rights against one another:
(a) the right to establish a driveway on the land over which the right of way is granted, and to make necessary repairs to any existing driveway on it, and to carry out any necessary maintenance or upkeep, altering if necessary the state of that land; and
(b) any necessary rights of entry onto that land, with or without machinery, plant, and equipment; and
(c) the right to have that land at all times kept clear of obstructions, whether caused by parked vehicles, deposit of materials, or unreasonable impediment to the use and enjoyment of the driveway; and
(d) the right to a reasonable contribution towards the cost of establishment, maintenance, upkeep, and repair of the driveway to an appropriate standard; and
(e) the right to recover the cost of repairing any damage to the driveway made necessary by any deliberate or negligent act of a person bound by these covenants or that person’s agents, contractors, employees, invitees, licensees, or tenants.
[45] All the registered proprietors who currently have the benefit of the ROW registered on their land titles hold the rights outlined in Schedule 5(2) against each other. These include the rights of entry, use and enjoyment (free from any obstruction), and a shared obligation to contribute to the costs of ongoing maintenance and repairs of the ROW. If Pennington (or the subsequent owner of 11 Mozeley Ave) is accorded the benefit of the ROW, the same rights and obligations will accrue to it. Mr Gould asked the Court to emphasise that there is a statutory obligation in terms of a reasonable contribution to maintenance. That is clear from Schedule 5(2)(d) above. This was the only matter Mr Gould pursued at the hearing.
Result
[46] The land in Record of Title NA565/277 owned by the applicant Pennington Trust Company Ltd is landlocked land.
Orders
[47]I make the following orders:
(a)Pursuant to Section 328 of the Property Law Act 2007 reasonable access is granted by way of a Right of Way for 11 Mozeley Avenue, Devonport, Auckland, appurtenant to Record of Title NA565/277 over the land in Record of Title NA565/251 upon the terms of the covenants implied in a grant of vehicular right of way contained in Section 297 and Schedule 5 of the Property Law Act 2007.
(b)That the order made in paragraph [47](a) above resulting from this application is to be entered in the Register as a grant in favour of Record of Title NA565/277 over the land contained in Record of Title NA565/251 by direction of the Court to the Registrar-General of Land Information New Zealand.
Costs
[48] Pennington is the successful party. The Wheelers’ Notice of Opposition was limited to the imposition of conditions. The conditions sought were abandoned at the hearing. In all the circumstances I consider this is a case where costs should lie where they fall.
[49] If either party disagrees they have leave to file a memorandum setting out their position within five working days of the date of this judgment. I will then make further timetable orders as necessary.
Gordon J
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