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Taylor v Small

Taylor v Small

Case [2019] NZCA 152 13 May 2019

Contract Formation

Statutory Interpretation

Restrictive Covenants

Estoppel

Property Law

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IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

CA715/2018
[2019] NZCA 152

BETWEEN	WILLIAM PETER TAYLOR AND SUSAN MARY TAYLOR First Appellants SCOTT KERRY JACKSON AND SARAH ANNE JACKSON Second Appellants RICHARD DONALD JOHNSTON AND RACHEL ELIZABETH JOHNSTON Third Appellants TREVOR FRANK SAVORY AND SALLIE ANN RENWICK Fourth Appellants
AND	GEOFFREY CLEMMENT SMALL AND ARIA SMALL First Respondents BOMBAY INVESTMENTS LIMITED Second Respondent

Hearing:	9 April 2019
Court:	Miller, Collins and Toogood JJ
Counsel:	R B Brabant and S T Darroch for Appellants A E Simkiss and J T Vickers for First Respondents No appearance for Second Respondent
Judgment:	13 May 2019 at 12.30 pm

JUDGMENT OF THE COURT

AThe appeal is allowed in part.
BThe cross-appeal is dismissed.
CThe case is remitted back to the High Court to determine the issues dealt with under the second ground of appeal in accordance with [82] of this judgment.
DCosts are awarded to the first respondents in accordance with [84] of this judgment.

____________________________________________________________________

REASONS OF THE COURT

(Given by Collins J)

Introduction

Four questions are raised in this appeal, namely whether the High Court was correct when it ruled:[1]
(a)That certain covenants allowed a dwelling house to be built on each of seven lots of land that had been subdivided from land Mr and Mrs Small (the Smalls) purchased from Mr and Mrs Taylor (the Taylors).
(b)That an equestrian facilities building, constructed by the Smalls on one of their subdivided lots, complied with the terms of the covenants.
(c)That conduct subsequent to the creation of the covenants was not admissible in construing the intentions of the parties to the covenants.
(d)That the Taylors were not estopped from advancing their interpretations of the covenants.
[1]Taylor v Small [2018] NZHC 2785.
It will be immediately apparent that the answers to questions [1](a) and (b) involve interpretation of the terms of covenants that restrict the use of land the Smalls purchased from the Taylors. There are two covenants in issue, referred to as Covenants 3 and 4. The terms of those covenants are, in all material respects, identical. The key clause of the covenants states:
(i)That the Covenantors shall not erect or permit to be erected or placed on the servient lands or any part thereof any building or erection other than a new (not being an existing building previously occupied or used and removed from another locality) single dwelling house and such farm outbuilding or ancillary buildings as are usual and reasonable for the type of rural use of the land in the subdivision (of which the dominant land and the servient lands form part) and of a nature design or style (including that of the garden or land-scaping aspects and fencing of surrounding grounds) in keeping with each other such that the dwelling house and any additional buildings and the surrounding grounds thereof blend in with the rural nature of the surrounding area to ensure that a pleasing and aesthetically compatible appearance is maintained…

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.

Continue reading Taylor v Small

Details

AGLC: Taylor v Small [2019] NZCA 152
Case: [2019] NZCA 152
Decision Date: 13 May 2019 at 12.30 pm

CaseChat Overview and Summary

This appeal arises from proceedings brought by the appellants, the Taylors and others, against the Smalls and Bombay Investments Limited in the High Court at Auckland. The appellants sought declarations and an injunction in relation to land the Smalls had subdivided and on which they had constructed an equestrian facilities building. The Smalls and Bombay Investments Limited cross-appealed from the High Court judgment. The appeal and cross-appeal were heard together by Miller, Collins and Toogood JJ. The first respondents were represented by counsel but the second respondent did not appear. The Court allowed the appeal in part and dismissed the cross-appeal. The Court remitted certain issues to the High Court for reconsideration in accordance with the terms of the judgment. The Court awarded the first respondents 70 per cent of their costs of the appeal. The Court summarised the facts and issues in the case. The Court held that the term "single" in the covenants referred to the nature and design of a dwelling house that may be constructed on the servient lands, and did not limit the number of houses that may be built on the lands subdivided by the Smalls. The Court held that the High Court erred when it failed to consider the evidence concerning the size and design of the various buildings within the subdivision. That exercise required an appraisal of competing evidence, which was likely to require cross-examination. The Court remitted the issue of whether the equestrian facilities building was usual and reasonable for the type of rural use of the land in the subdivision to the High Court for reconsideration in accordance with the terms of this judgment. The Court dismissed the cross-appeal. The Court held that the Taylors and other appellants were not estopped from advancing their interpretations of the covenants. The Court held that the conduct of the Taylors and other appellants fell well short of being unconscionable.

Orders