Repotane Trust Limited v Hart - [2023] NZHC 1754

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2023-419-000278

[2023] NZHC 1754

IN THE MATTER OF Enforcement of Covenant in Easement Instrument 10104470.2

BETWEEN

REPOTANE TRUST LIMITED

Applicant

AND

SHEREE ANN HART, MATTHEW NORMAN HART and BR LEGAL TRUSTEE COMPANY LIMITED as

trustees of the HART FAMILY TRUST NO. 2

Respondents

Hearing: 5 December 2023

Appearances:

D Shore and A Cox for the Applicant

T Braun and J Perry for the Respondents

Judgment:

18 December 2023

JUDGMENT OF WALKER J

This judgment was delivered by me on 18 December 2023 at 4 pm Pursuant to Rule 11.5 High Court Rules

Registrar/Deputy Registrar

Solicitors:

McCaw Lewis, Hamilton
Braun Bond & Lomas, Hamilton

REPOTANE TRUST LIMITED v HART [2023] NZHC 1754 [18 December 2023]

[1] Neighbours in a rural enclave in Tamahere are at odds over a home under construction by the respondents, trustees of the Hart Family Trust No 2. The applicant, Repotane Trust Limited (Repotane), is the owner of the lot next door which benefits from a restrictive covenant. It asserts that, in breach of that covenant, the respondents (the Harts), failed to obtain approval for the plans and colours to be used on the exterior of the dwelling. The Harts contend that Repotane unreasonably withheld approval and, in doing so, disqualified itself from relying on the covenant.

[2] Presently before this Court is an application by Repotane for an interlocutory injunction to halt construction until the substantive claim to enforce the covenant is determined.

[3] As relevant, the restrictive covenant recorded in the registered easement instrument (No 10104470.2) reads:

The Grantor and Grantee acknowledge and agree that the following land covenants will be registered on the titles for Lots 1,2 and 3 DPS 453154 so as to bind themselves and their respective successors and assigns as follows:

…

3.Not to construct any dwelling on Lots 1 and 3 DP453154 without first obtaining written approval as to the plans and colours to be used on the exterior of the dwelling of the registered proprietor of Lot 2 DPS453154. The registered proprietor of Lot 2 shall not unreasonably withhold their consent.

…

9.The Grantor covenants for the Grantor personally and their successors and assigns that should the Grantor fail to comply with, observe, perform, or complete any of the covenants and restrictions contained herein, and without prejudice to any other liability the Grantor may have to the Grantee or any other person the Grantor will:

(i)Immediately upon receipt of a written demand for payment from the vendor or dominant tenement or their solicitors pay to the Grantee as liquidated damages the sum of FIVE HUNDRED DOLLARS ($500.00) per day for each day the default continues unremediated such liquidated damages to be limited to a maximum value of $50,000.00 and

(ii)Shall immediately undertake such remedial action as may be required by the Grantee including but not limited to permanently removing or causing to be permanently removed from the property any improvement or structure…

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: [2023] NZHC 1754
Decision Date: 18 December 2023

CaseChat Overview and Summary

In the High Court of New Zealand, the case of Repotane Trust Limited v Hart [2023] NZHC 1754 involves a dispute between neighbours over a home under construction by the Harts, trustees of the Hart Family Trust No. 2, in breach of a restrictive covenant. Repotane Trust Limited, the owner of the lot next door, claims that the Harts failed to obtain approval for the plans and colours to be used on the exterior of the dwelling as required by the covenant. The Harts contend that Repotane unreasonably withheld approval and disqualified itself from relying on the covenant.

The legal issues before the court were whether there was a serious question to be tried, whether the balance of convenience favoured stopping work in the interim, and where the overall justice lay. The court found that there was a serious issue to be tried, but the balance of convenience and overall justice favoured declining to grant an interlocutory injunction. The court considered the significant impact on third parties, such as the builder and subcontractors, if construction were to be halted. Additionally, the court noted that the Harts had proceeded on risk and continued to do so.

The court declined to grant an interlocutory injunction and made timetabling directions to advance the claim to an urgent three-day hearing commencing on 22 April 2024. The court encouraged the parties to consider arbitration or mediation to resolve the impasse and reserved the question of costs.

Orders