Adealon International Proprietary Ltd. v London Borough of Merton

I am grateful to Mr Partridge and Mr Small for their assistance with this case.

The claimant is the owner of freehold land, referred to in these proceedings as the red land, north of the A24 Merantun Way. The red land has title number SGL 289867. The area of the red land is approximately 525 square metres, or 5,665 ft.². The defendant council is the registered proprietor of land which lies to the south of 61/63 High Path and to the north of and immediately adjacent to the red land. This is referred to as the green land. It has title number SY 157837. The area of the green land is approximately 3,237 square metres, or 34,045 square feet. To the south of the red land is the highway, the A24, at that point now called Merantun Way, and this has title number SGL 516994.

By proceedings begun in August 2003, the claimant claimed that the defendant had trespassed upon the red land and claimed that there was implied in a transfer of land dated 23 October 1989 a right of way in favour of the red land over the green land. By a compromise agreed immediately before trial, the parties agreed, amongst other matters, settlement terms in respect of the claimant’s claim for trespass and that their claim for damages in respect of the defendant’s unlawful use and enjoyment of the red land be limited to damages (if any) arising from 18 August 1999 only. Quantum issues are to be dealt with following this judgment. Accordingly, the issue for this judgment is whether the claimant is entitled to a declaration that the red land is entitled to a right of way of necessity over the green land. The defendant’s case is that the claimant is entitled to no such a declaration. If the claimant is entitled to a declaration with respect to the right of way, there is a dispute between the parties as to the scope of such right.

Mr Manzoor Hussain is a director of the claimant company. He made a statement in these proceedings. The defendant did not require him to be cross examined.

Mr Joy, manager of the Property Management and Review Section within the defendant’s Environment and Regeneration Department, prepared two witness statements. He was cross-examined very briefly, and on very limited points. Mr Joy gave evidence about the various planning applications relating to the parcels of land and about the location of the boundary between the red land and the highway.

From the mid-1980s, Boastdean Limited had owned land at 61/63 High Path. This was land fronting High Path on its northern boundary and on which was situated a warehouse with concrete hardstanding to the rear. Boastdean also owned a piece of land to the rear, which was part of the site of a disused railway. Boastdean had laid concrete on this rear piece of land, in extension of the hardstanding to the rear of the green land. The warehouse was used as a cash and carry store. At about this time, the compulsory purchase of the entire rear section of land was mooted as it might form part of the then proposed Merton Relief Road, intended to run along the line of the disused railway at this point.

In December 1986, Boastdean applied for planning permission to use the rear land as a temporary car park. In February 1987 that application was refused, as the site was directly affected by the proposed line of the relief road. Boastdean’s appeal against the refusal of planning permission failed.

In June 1988, to overcome Boastdean’s objection, the line of the relief road was altered. As a consequence, only a small part of the red land was acquired for the road.

In July 1988, Boastdean transferred the southern section of the rear land to Ramheath Limited. That section was registered under title number SGL 516994. The northern section of the rear land was retained by Boastdean and registered under title number SGL 289867, and comprises the red land. Ramheath have a right to maintain a wall along the boundary between the land transferred and the land retained.

In February 1989, Merantun Way was opened.

By transfer dated 23 October 1989, Boastdean transferred the green land to the defendant’s predecessor in title, Kempstone Limited, whilst retaining ownership of the red land. After 23 October 1989, Boastdean had no means of access to or egress from the red land to the south, which is bordered by Merantun Way.

In November 1989 an application was made for outline planning permission for the erection of light industrial buildings. The development the subject of that application was to obtain access to and egress from High Path only. Conditional consent was granted.

On 5 September 1991, Ramheath transferred land to the defendant, including SGL 516994.

In September 1991, the warehouse was destroyed by fire.

In November 2001 an application was made for planning permission for the formation of new vehicular access from on to Merantun Way. That application was refused in January 2002.

On 31 December 1991, Mr Hussain submitted an application for planning permission for development, including construction of a petrol station with access from Merantun Way. In April 1992, that application was refused. In August 1992, an application was submitted for planning permission for a revised petrol station scheme. In May 1993, that application was refused.

Mr Hussain agreed with Dunbar Bank plc that the land owned by Kempstone should be sold. The land was transferred to the defendant on 29 March 1994. The transferor was Dunbar. The bank transferred in exercise of the power of sale conferred by a mortgage. Prior to the transfer, the defendant raised pre-contract general inquiries. By question 4, the defendant had asked the vendor to supply full details of any rights or licences to which the property was subject, including in particular any rights of way, wayleaves, easements or any public or common rights. The reply was: “the vendor has no information other than may be disclosed by the title documents or apparent on inspection.” That answer was qualified by the statement, at the end of the document, that “the vendor is selling as mortgagee under its power of sale and thus has never been in occupation of the property, therefore the answers given are the best that can be given in the circumstances.”

It would appear that the defendant did not realise that the red land was under separate ownership from the green land, and took occupation of both the green and red land. In October 1994, the defendant applied for planning permission to build a daycare centre on the site and to provide an area for parking for disabled transport. Permission was granted in January 1995, and the defendant subsequently built the day-care centre and incorporated the western section of the red land into its garden, taking up the concrete hardstanding. In May 1996, the defendant leased the eastern side of the site, including the eastern section of the red land, to Merton Association for Disabled People for the purpose of parking ambulances.

In July 2000, Boastdean transferred the red land to the claimant company and assigned to the claimant all causes of action pertaining to the land.

Mr Hussain says that it was not until about 1994/1995 that he drove past the site and noted that building work was going on. Some time later, he considered what to do with the red land as the market was showing some signs of recovery. He visited the site. He found that the red land was being used by the defendant for parking ambulances and other vehicles and as a landscaped garden for the daycare centre which the defendant had built on the green land. Mr Hussain noted that the day-care centre had been built in such a way that the western side of the building was some distance from the western boundary and that a strip of land of similar width to the width of the former exit road remained. He says “I assumed that the [defendant] were fully aware of the existence of the right of way and had purposely built the day care centre in that way.”

In his statement, Mr Hussain explains that he was the beneficial owner of and UK agent for Parbook Limited. In early 1989, on behalf of Parbrook, Mr Hussain began negotiations with the management of Boastdean which, at that time, owned the whole site at 61/63 High Path, with the cash and carry warehouse on the site, fronting High Path, and a car park at the rear of the site. The access to the car park was from the eastern end of the warehouse and the exit was from the western end of the warehouse. There was, in effect, a U-shaped in-and-out drive which ran around both sides of and along the rear of the building.

Mr Hussain explains that Parbrook acquired the shares in and took control of Boastdean. Parbrook then sold what is now the green land to Kempstone. He notes that Boastdean kept the smaller, back part of the land, i.e. what is now the red land, and then subsequently transferred the red land to the claimant company. Mr Hussain retained a beneficial interest in both Parbrook and Kempstone. In his statement, Mr Hussain explains that part only of the land was sold to Kempstone because, he says, Parbrook wanted to exercise a degree of control over what Mr Hussain described as a proposed joint-venture with an (unnamed) investor in Jersey, and did not want Kempstone to be able to “run off” with the deal on its own.

Mr Hussain says that he entered into negotiations with the investor to develop the whole of the site i.e. both parcels of land, as part of a joint venture. He says that, as a result, the larger parcel, i.e. the green land, was mortgaged to Dunbar Bank plc. Architects were instructed to prepare a planning application for the demolition of the existing warehouse and for both parcels of land to be available for offices and light industrial use, which was granted. The property market then deteriorated. Mr Hussain negotiated with the council for a change of use for a petrol station and some light industrial units on the red land. He says he had reached an agreement with BP to build a petrol station and car wash on that land. The petrol station was to face Merantun Way and the industrial units were to face High Path. However, the council would not allow access from Merantun Way for the petrol station, on safety grounds, and the application for planning permission was refused.

Mr Hussain does not give a very fall account of matters relevant to the decisions to sell the larger parcel of land to Kempstone and to retain the smaller, rear of parcel of land. He refers to negotiations with an investor with a view to entering into a joint venture to develop both parcels of land, but it is not clear, for example, whether there any joint-venture agreement was entered into. It appears that Mr Hussain decided to retain the rear land in the hope that anything built on that land would face Merantun Way and have access to it. It seems to me that the expectation, at that time, was that there was likely to be access from the rear land on to the highway.

Mr Hussain chose to retain the red land. I infer from all the evidence available to me that Mr Hussain had hoped to be able to develop the land to the south and to do so by gaining access to the highway and not from and to High Path. Initially, the rear land was thought likely to be incorporated into the new highway. That did not happen, but Mr Hussain then sought planning permission for a petrol station and car wash facing Merantun Way. It appears to me that Mr Hussain took the view that it would benefit him to retain the red land. The sale by Dunbar in March 1994 was not a hostile act on the part of the bank. The sale was consistent with Mr Hussain’s desire to dispose of some land and to retain and develop the red land.

To the west and to the east of the red land lies land belonging to third parties and over which the claimant has no legal right of way.

The southern boundary of the red land, now, is the highway. It is not in dispute between the parties that the highway and the red land share a common boundary. There is now a fence along that boundary. Mr Partridge asks me to make a finding that, as a matter of fact, a wall existed at one time along the boundary between the red land and Merantun Way. The only evidence that such a wall may have existed is the reference in the charges register for title SGL 289867. This reads as follows “the right to enter on the remainder of the land comprised in the above title for the purpose of maintaining, renewing or repairing the wall constructed on the property between the points A and B on the plan annexed hereto (but only so far as the same cannot reasonably be done without such entry) the Transferee doing no unnecessary damage and making good any damage caused. Note: the land edged red referred to is the land edged and numbered SGL 516994 in green on the filed plan. The wall between points A and B referred to is the northern boundary of the land edged and numbered SGL 516994 in green on the filed plan.” There is, for example, no evidence from Mr Hussain as to the existence of such a wall. There is now a wooden fence along the boundary. If there ever had been a wall, there is no evidence as to when such a wall was demolished. The entry in the charges register is not conclusive proof that there was such a wall. In the absence of any other evidence, the claimant has not persuaded me that such a wall existed.

It is common ground that there is a common law right of access to the highway. Planning permission is required for access to some roads; Merantun Way is one such road. It is common ground that the authority with power to grant or refuse the necessary permission is the defendant. The defendant would need to consult Transport for London (TfL). The defendant’s Highways and Engineering Manager wrote to TfL in July 2001 concerning the proposals for industrial units on the rear of land. TfL replied by letter dated 13 July 2001 to explain that they were concerned with the question whether the development might have a significant impact on the highway network and on Merantun Way in particular. They said “we have considered the proposed development…..and feel that it would be difficult to object to providing direct access to [Merantun Way] for a scheme of this type. We would expect the developer to fund the provision of a median strip or other similar physical device to restrict U-turns or right terms into and out of the site through a section 278 agreement. We would only allow this type of development direct access to [Merantun Way] as the traffic generation is likely to be low. If a subsequent application for a greater traffic generating development was made then we would object most strongly because of the likely impact on the performance of the Transport for London Road Network.”

By letter dated 28 February 2005, TfL notified the defendant as follows: “historically there has been no direct access to properties on joining roads from Merantun Way, indeed access to the site in question has always been from High Path. There is no pedestrian access along this section of Merantun Way to the site (pedestrians are not permitted by Traffic Regulation Order). As Merantun Way is a classified road any proposed access would require [the defendant] to grant planning permission. In this case TfL would be minded to recommend [the defendant] refuse permission on highway safety grounds. TfL consider that any vehicles emerging from properties in this location would significantly increase the risk of accidents and encourage illegal use of [Merantun Way] by pedestrians.”

In summary, therefore, whilst in 2001, permission may have been granted for access from the red land to Merantun Way, the present position is that planning permission would probably not be granted. The consequence is that the claimant has no legally enforceable right of access. The transfer of the green land to Kempstone is in simple form. It contains no express reservation of an easement in favour of the red land. Without a reservation of a right over the green land, the red land is and remains landlocked. The claimant’s case is that a reservation of way of necessity must, therefore, be implied.

Paragraph 3-109 of Gale on Easements the learned authors describe easements of necessity as follows:

“A way of necessity, strictly so called, arises where, on a disposition by a common owner of part of his land, either the part disposed of or the part retained is left without any legally enforceable means of access. In such a case the part so left inaccessible is entitled, as of necessity, to a way over the other part. ….

‘If I have a field enclosed by my land on all sides, and I alien this close to another, he shall have a way to this close over my land, as incident to the grant; for otherwise he cannot have any benefit from the grant. And the grantor shall assign the way where he can best spare it. Rolle’s Abridgement, tit Graunt, p l.17

Where a man having a close surrounded with his own land, grants that close to another in fee….the grantor shall have a way to the close over the grantor’s land, as incident to the grant, for without it he cannot derive any benefit from the grant. So it is where he grants the land, and reserves the close to himself.’ 1 Wms.Saund. (1871 ed) 570”

At paragraph 3-112 the learned authors summarise the decisions in Barry v Hasseldine [1952] Ch. 835 and Titchmarsh v Royston Water Co (1899) 81 L.T. 673. Mr Small submits that the summaries are incorrect.

Mr Partridge and Mr Small have taken me to the following cases:

Clark v Cogge : “the case was, the one sells land and afterwards the vendee, by reason thereof, claims a way over the plaintiff’s land, there being no other convenient way adjoining: and, whether this were a lawful claim was the question. And it was resolved without argument, but the way it remained, and that he might well justify the using thereof, because it is a thing of necessity; for otherwise he could not have any profit of his land: et e converso, if a man hath four closes lying together, and sells three of them, reserving the middle close, and hath not any way thereto but through one of those which he sold, although he reserved not any way, yet he shall have it, as reserved unto him by the law; and there is not any extinguishment of a way by having both lands.”

Corporation of London v Riggs (1880) 13 Ch. D. 798

Titchmarsh v Royston Water Company Limited (1899) 81 L.T. 673

Union Lighterage Company v London Graving Dock Company [1902] 2 Ch. 557

Pwllbach Colliery C Ltd v Woodman [1915] A.C. 634

In re Webb’s Lease, Sandom v Webb [1951] 1 Ch. 808: At page 820, Evershed M.R., said: “If by this language Salter J intended to lay it down that in a case such as this (where it is or may be reasonable for the court to assume that, if the parties had applied to their minds to the problem of the advertisements, they would or should have made provision for securing to the landlord such right as he now claims) it is sufficient for the landlord to establish the absence of any evidence of a contrary intention, it seems to me that the proposition is in direct conflict with the principle, which is not only well established but which also, in my judgment, ought not to be lightly qualified, the principle that it is the duty of a grantor to reserve expressly any right he wishes to maintain against his grantee or at least to prove affirmatively that such a reservation was clearly intended by him and his grantee at the time of the grant.”

In the same case, Jenkins LJ quoted from that passage in the speech of Lord Parker in the Pwllbach Colliery case in which Lord Parker had said: “But it is essential for this purpose that the parties should intend that the subject of the grant or the land retained by the grantor should be used in some definite and particular manner. It is not enough that the subject of the grant or the land retained should be intended to be used in a manner which may or may not involve this definite and particular use.” Jenkins LJ then referred to that part of the judgment at first instance where Danckwerts J had concluded: “It does seem to me that there may be exceptional circumstances in which it is only common sense to imply some reservation, for example, the circumstances of the present case….it seems to me commonsense to imply an intention on the part of the two parties…that those advertisements should be allowed to remain.” Jenkins LJ said: “I find myself unable to agree with the judge’s conclusion. The question is whether the circumstances of the case as proved in evidence are such as to raise a necessary inference that the common intention of the parties was to reserve to the landlord…some, and if so what, rights in regard to the display of advertisements….or such as to preclude the tenant from denying the implied reservation to the landlord of some such rights consistently with good faith. That question must be approached with the following principles in mind: (i) if the landlord intended to reserve any such rights over the demised premises it was his duty to reserve them expressly…(ii) the landlord having failed in this duty, the onus was upon him to establish the facts to prove, and prove clearly, that his case was an exception to the rule….(iii) ..the mere fact that the tenant knew at the date of the lease…that the landlord was using the outer walls of the demised premises for the display of the advertisements in question did not suffice to absolve the landlord from his duty of expressly reserving any rights in respect of them he intended to claim, or to take the case out of the general rule.”

Barry v Hasseldine [1952] Ch. 835

As Mr Small points out, in fact, there was authority on the point, namely the judgment of Kekewich J in Titchmarsh.

Nickerson v Barraclough [1981] Ch. 426

Buckley LJ said: “I entirely agree with the judgment which has been delivered by Brightman LJ. In particular, in my judgment the law relating to ways of necessity rests not upon a basis of public policy but upon the implication to be drawn from the fact that unless some way is implied, a parcel of land will be inaccessible. From that fact the implication arises that the parties must have intended that some way giving access to the land should have been granted.”

MRA Engineering Ltd v Trimster Co Ltd (1987) 56 P.& C.R. 1

Sommer v Sweet [2004] EWHC 1504 and [2005] EWCA Civ 227

The position, therefore, is that Kekewich J and Danckwerts J took different approaches, but the judgment of the former was not drawn to the latter’s attention. Mr Small submits that the judgment in Sommer does not assist because, as appears from paragraphs 24 and 26 of the judgment, Hart J founded his decision not on the doctrine of necessity but, rather, on that concerning an easement of common intention. He took into account information relevant to what was, Mr Small submits, an easement of common intention and did not look at the elements necessary for an easement of necessity, strictly so called.

I accept Mr Small’s submission that, in Nickerson, Brightman LJ was considering only whether the doctrine of way of necessity was founded on public policy. I do not take the judgment of Brightman LJ as authority for the proposition that the doctrine of way of necessity was founded on an implication from the circumstances.

As Mr Small points out, the authorities indicate a distinction between the doctrines of way of necessity and of common intention.

I take as a starting point the proposition that a man shall not derogate from his own grant. The grant of a way of necessity is an exception to that rule. That is emphasised in, for example, the judgment of Jessel MR in Corporation of London v Riggs. I note that some of the authorities (eg Hart J in Sommer and Danckwerts J in Hasseldine) make no reference to the doctrine of non-derogation from grant. I consider whether this case is an exception to that doctrine.

At the date of the transfer by Boastdean to Kempstone in 1989, Merantun Way had been built to the south of the red land. The red land was not surrounded by land owned by Kempstone. To the west and east land was owned by third parties. To the south was the highway. On that ground alone, following Titchmarsh, the claimant has not demonstrated that it is entitled to the grant of an easement of necessity.

The existence or otherwise of the wall is probably irrelevant. Even if, contrary to my conclusion, there had been a wall at the time of the 1989 transfer, the claimant would always have the right (subject to the obtaining of planning consent) to enter directly on to the highway.

There is a common law right to go on to the highway. The obstacle here is that planning permission is required to access what is a trunk road. As matters currently stand, there is no possibility of access to the highway, but that does not mean that access to the highway will never be possible in the future. After all, in 2001, TfL were prepared to contemplate access to and egress from the highway. The possibility that this may be so again, some time in the future, cannot be ruled out. In any event, it is not a question of considering whether, in all the circumstances as currently obtain it would be right for the claimant to have an easement of necessity; that is not the test. Nor is the test whether it would be common sense to imply some reservation in the circumstances.

The evidence indicates that it was not the common intention of the parties that the red land should have access to High Path over the green land. Before the red land and green land were split, Mr Hussain proceeded on the basis that he wished to take advantage of the fact that the red land adjoined the highway. Until the application for planning permission for a petrol station and car wash on the red land was refused, the intention was to look south, not north. Mr Hussain’s focus was to the south. His principal intention was to retain and use the red land in a way which contemplated access to and egress from the land by way of the highway to the south. When the green and red land were split, there was of course no express reservation of easement and no evidence that anyone contemplated the need for this.

I conclude that the claimant has not proved its claim to be entitled to a way of necessity over the green land.

In his skeleton argument, Mr Partridge for the claimant said that the claimant chose the U-shaped in and out route over the green land. However, at trial, the claimant clarified the extent of the right of way claimed, namely a straight route for vehicular and pedestrian access from High Path, along the eastern part of the green land, to the red land. The claimant seeks a right for vehicular and pedestrian access.

Mr Small submits that, if the claimant is entitled to a right of way, such right should be for pedestrian access only. The defendant did not suggest any alternative route.

The claimant would be entitled to no more than what was necessary at the time of the grant. It would not be entitled to be put into a better position than it would have been at the time the grant was made. If (contrary to my conclusion) the claimant had proved its case with respect to a way of necessity, I should have concluded that it was entitled to access by vehicles as well as for pedestrians, along a route running on the eastern side of the green land from High Path to the red land. The red land was used, albeit only in conjunction only with the green land, for car parking and in connection with the warehouse. The red land was accessed and used by vehicles. To limit access to that by pedestrians only would not reflect the use made of the land at the time of the grant. To permit vehicular access would not give the claimant more than would have been granted at the time of the grant. In arriving at that conclusion, I take into account that it would inconvenience the defendant if vehicular access were permitted.

There is a dispute between the parties as to the precise location of the boundary between the red and green land. On 21 March 2006, at the trial of this matter, the court gave the parties permission jointly to instruct an expert surveyor to express an opinion as to the location of the boundary. Evidence on that point is to be given, if such evidence is still required, on the handing down of this judgment.

The question of quantum is to be considered after delivery of this judgment.