Street v Fountaine - [2018] NZCA 55

IN THE COURT OF APPEAL OF NEW ZEALAND

CA539/2016
[2018] NZCA 55

BETWEEN

CHRISTOPHER JOHN STREET, PHILIP JOHN ENGLAND, MICHAEL JOHN STREET AND JOAN ISABELLA STREET
Appellants

AND

REX ALISTAIR FOUNTAINE
First Respondent

ASHBY DOWNS LIMITED
Second Respondent

ANZ BANK NEW ZEALAND LIMITED
Third Respondent

CA617/2016
BETWEEN	REX ALISTAIR FOUNTAINE AND ASHBY DOWNS LIMITED Appellants
AND	CHRISTOPHER JOHN STREET, PHILIP JOHN ENGLAND, MICHAEL JOHN STREET AND JOAN ISABELLA STREET Respondents

Hearing:	8 ,9 and 10 August 2017 (further submissions 3, 10 October and 4 December 2017)
Court:	French, Winkelmann and Gilbert JJ
Counsel:	D J Goddard QC and R K Macdonald for Appellants T G Stapleton QC for Respondents
Judgment:	19 March 2018 at 10.30 am

JUDGMENT OF THE COURT

AThe appeal against the substantive judgment of Clifford J is allowed.
BThe Street Trustees are entitled to orders as set out in [154]–[155].
CThe costs orders made in the High Court are quashed.
DCosts in the High Court are fixed on the basis that the Street Trustees are entitled to costs calculated on a band 2B basis, together with disbursements to be fixed by the Registrar of the High Court.
EThe respondents must pay the appellants costs for a complex appeal on a band A basis and usual disbursements. We certify for two counsel.

____________________________________________________________________

REASONS OF THE COURT

(Given by Winkelmann J)

Table of Contents

Para No.
Introduction		[1]
The issues on appeal		[10]
Factual background
The creation of the scheme		[14]
Easement over Maungahuia		[26]
The upgrade of the scheme in 1993‑1994		[28]
Tensions		[30]
High Court judgment		[33]
First issue: did the Judge err in finding there was no enforceable agreement to grant easements in relation to scheme infrastructure located on Waikaramu and The Downs?
Legal principles: easements		[43]
Did Mr John Fountaine agree to grant an easement over Waikaramu in 1971–1972 and, if so, is that agreement enforceable?		[53]
(a) Documentary record		[55]
(b) Conduct of the parties		[76]
(c) Oral evidence		[83]
(d) Conclusion on whether Mr John Fountaine agreed to grant an easement over Waikaramu in 1971		[89]
(e) Was there sufficient consideration?		[90]
(f) Were there sufficient acts of part performance?		[92]
(g) Did Mr John Fountaine have sufficient interest in the land to grant an easement?		[97]
Did Mr James Ashby agree to grant an easement over The Downs in 1971–1972?
(a) The basis of the claim		[101]
(b) Analysis		[105]
Were easements agreed to in respect of the scheme as modified in 1993–1994?
(a) The basis of the claim		[110]
(b) Analysis		[117]
Second issue: did the Judge err in finding that the respondents were not estopped from denying the existence of such easements?
Relevant principles		[133]
The issues		[135]
Third issue: if there is an equitable easement or easements, what relief if any is appropriate to give effect to these easements?
Submissions		[147]
Orders		[154]
Fourth issue: if there is no equitable easement, what other equitable rights and obligations exist in relation to scheme infrastructure, and what relief is appropriate?

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: [2018] NZCA 55
Decision Date: 19 March 2018

CaseChat Overview and Summary

The Street Trustees, the trustees of the Street Trust, sought declarations that they were entitled to easements in respect of two farms, Waikaramu and The Downs. The farms are in the Ahiaruhe Valley, and the farms are used to supply stock water to other properties in the area. The lower scheme was installed to supply stock water to the farms in the area, and the scheme involved the installation of water pipes over Waikaramu and The Downs. The respondents are the owners of Waikaramu and The Downs, and they argued that the presence of the scheme infrastructure on their properties was pursuant to a gentlemen’s agreement terminable at pleasure. The Street Trustees argued that the presence of the scheme infrastructure on Waikaramu and The Downs was pursuant to an easement. The parties had been involved in a dispute over the scheme for some time, and the Street Trustees had sought relief in the High Court. Clifford J dismissed the Street Trustees’ claim. The Street Trustees appealed. The Court of Appeal allowed the appeal, finding that the Street Trustees were entitled to equitable easements in respect of Waikaramu and The Downs. The Court of Appeal also found that the respondents were not estopped from denying the existence of such easements. The Court of Appeal allowed the Street Trustees’ claim, and ordered that they be granted registered easements over Waikaramu and The Downs, subject to certain conditions. The Court of Appeal quashed the costs orders made in the High Court, and fixed costs on a band 2B basis. The respondents were ordered to pay the Street Trustees’ costs on a band A basis.

Orders