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Carpenter & Ors v Calico Quays Ltd & Anor

[2011] EWHC 96 (Ch)

Neutral Citation Number: [2011] EWHC 96 (Ch)

Appeal Reference 2010/0350

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

ON APPEAL FROM THE LEICESTER COUNTY COURT

Her Honour Judge Hampton

Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 27/01/2011

Before :

THE HON MR JUSTICE FLOYD

Between :

(1) ALAN J CARPENTER

(2) PAUL LEONARD TUDOR

(3) APAC PACKAGING LIMITED

(4) MERLION CAPITAL ROTHLEY LIMITED

Claimants/Respondents

- and -

(1) CALICO QUAYS LIMITED

(2) GOODMAN REAL ESTATE LIMITED

Defendants/Appellants

John Randall QC (instructed by Wragge & Co) for the Defendants/Appellants

John McGhee QC and Paul Clarke (instructed by Spearing Waite) for the Claimants/Respondents

Hearing dates: 12th and 13th January 2011

Judgment

Mr Justice Floyd :

1.

This is an appeal from the judgment of Her Honour Judge Hampton sitting in the Leicester County Court given on 26th January 2010, in an action concerning a right of way. By the time of the trial, the sole issue before the Judge was the physical extent (in terms of width) of the right of way which was acknowledged to exist over the land of the appellants and which gave access to the land of the respondents. In more precise terms the issue was whether the right of way extended only over the tarmac surface of the access road which was in place at the time the right of way was granted, or whether it included the grass verges (of widths varying between 0.5 metres and 2 metres on either side). The issue turns upon the true construction of a deed dated 15th April 1999 granting the right of way (“the Deed”).

2.

Although the proceedings were commenced by a claim form under Part 8 of the CPR, the parties agreed on a procedure much more akin to proceedings under Part 7. There was disclosure, and the Judge heard oral evidence from a number of witnesses who were cross-examined. However, as there was no formal order treating the case as one commenced under Part 7, the Court of Appeal declined jurisdiction and the appeal came before me, as a single judge of the Chancery Division. Parties should be aware of the consequences that this informal approach has on their routes of appeal.

3.

Disputes of this kind between neighbours are regrettable – see the observations of Mummery LJ in Wilkinson v Farmer [2010] EWCA Civ 1148 at [4]–[5]. The present dispute arises, however, against a commercial background in an area where the potential for development may not have been exhausted. Both parties obviously consider that the result has important consequences for their commercial interests.

4.

The background to the grant of the right of way is as follows. In 1978, Alan Carpenter, the first respondent, and his brother David, purchased land known as Rowena Nurseries, where they ran a plant nursery business. David Carpenter died in 2003 and the second respondent was registered in his place as a paid trustee. The third and fourth respondents are trustees of the trust of land which holds Rowena Nurseries.

5.

The right of way which is the subject of the dispute runs from the A6 road to Rowena Nurseries over land belonging to the appellants. In 1989 the Secretary of State for Transport (“SoS”) wished to alter the route of the old A6 which ran past Rowena Nurseries, and from which access to the nurseries was obtained. The land on which the existing access to Rowena Nurseries from the A6 lay was to be acquired from the Carpenters by the SoS, the existing access road was to be stopped up, and a new means of access provided. The scheme was implemented by, firstly, a Compulsory Purchase Order: The London – Inverness Trunk Road (Quorn – Mountsorrell By-Pass) Compulsory Purchase (EM No 3) Order 1989 (“the Compulsory Purchase Order” or “CPO”). This provided for the acquisition of rights to or over various parcels of land necessary for construction of the highway or for implementing the modifications to side access necessary in consequence. The land affected included land owned by the Carpenters and land owned by predecessors of the appellants (called the “Wilson Trustees”). Secondly, the (A6) London – Inverness Trunk Road (Quorn – Mountsorrell By-Pass Side Roads) Order 1989 (“the Side Roads Order” or “SRO”) provided, amongst other things, for the stopping up of the old means of access and the construction of the new means of access to Rowena Nurseries. It is convenient to think of the new access road as running north to south, parallel to the route of the A6, and to the east of it. The new means of access approached the nurseries from the north. A roundabout was constructed at the north end, connected via a bridge to another roundabout on the other side of the A6, so that vehicles travelling along the A6 in either direction could access the nurseries and the need for right turns could be avoided. The disputed verges on the access road are thus the “eastern verge” and the “western verge”. I consider the terms of the CPO and the SRO in a little more detail below.

6.

The SoS was obliged by statute to provide the Carpenters with “another reasonably convenient means of access” to the relevant premises: Highways Act 1980 section 125(3)(b). This, like the CPO and the SRO, forms part of the commonly available background to the construction of the Deed.

7.

The Carpenters originally wished to acquire the freehold of the land on which the new means of access was located, but negotiations between them and the Wilson Trustees proved unsuccessful. In 1997 the SoS advised the Carpenters that if the Wilson Trustees granted them a right of way over the land, the SoS had no power to acquire it compulsorily. Negotiations then took place directly between the Wilson Trustees and the Carpenters, resulting in the Deed in April 1999. By the time the Deed was entered into, the new means of access provided by the SoS had already been in existence since 1991.

8.

Moving from west to east (i.e. from the A6 towards the access and then beyond) there were the following physical features on the land:

i)

An area of landscaping adjoining the A6 (“the Highway Land”). The Highway Land, acquired by the SoS from the Wilson Trustees, was, according to the land transfer between the Wilson Trustees and the SoS (“the Land Transfer”), intended to be delimited to the east by a quickthorn hedge to be planted as “accommodation works” by the SoS. There is no dispute that such a hedge was planted, although it is not that clearly visible in the photographs.

ii)

The Land Transfer also obliged the SoS to construct a “post and four-rail fence” on the access road side of the boundary. Such a fence was erected. There was a debate before me about how far from the middle of the quickthorn hedge the fence was built. The judge found that “there was very little distance between the hedge which did not appear to be growing very robustly and the fence. Quickthorn is a vigorous plant and if cared for, might have been expected to grow into and cover the fence”.

iii)

The western verge. This was of grass and was of varying width, but was generally of the order of two metres.

iv)

The tarmac surface. This too was of varying width, surveyed at between 5.8 and 8 metres not counting the widening at the northern end adjacent the roundabout. It was at least as wide, and probably wider, than the compulsorily purchased access road which it replaced.

v)

The eastern verge. This was of grass and varied in width between 0.5 metres and 1 metre.

vi)

An embankment area constructed to support the roadway, commencing at the point where the gradient of relatively level grass strip starts to fall away downhill. This is referred to as the “roll-over point”, and is a visible feature on the land.

vii)

A landscaped area at the foot of the embankment.

9.

The Judge had the benefit of a site visit, but photographs of the site are available and with the benefit of these I have been able to obtain a reasonable picture of the relevant features of the land. As the Judge recorded, there was little in the way of factual dispute about these in any event. I am obviously in a poor position to come to a different view on factual matters which the Judge recorded as a result of her site visit.

10.

Since about 1991 the Carpenters had placed two signs on the eastern grass strip adjacent the roundabout advertising the nurseries. A separate agreement (“the Signage Agreement”) was negotiated at the same time as the Deed was negotiated, and is of even date. It permitted the erection and maintenance of signs on the eastern grass strip, and gave the Carpenters a right to mow a strip shown on the eastern side of the access. It was common ground that the Signage Agreement formed part of the relevant background to the construction of the Deed. I consider its terms in a little more detail below.

11.

When the new means of access was first constructed there was a single arm barrier extending between two posts at the southern end of the access. The posts were set into the verges on each side of the tarmac. There was a gap between the posts and the tarmac, so that the opening created when the barrier was up was greater than the width of the tarmac. On the opposite sides of the posts from the tarmac, stub fences ran from the posts across the remainder of the verges on both sides, closing off a part of each verge, and creating a complete barrier when the single arm barrier was in place. At some point the single arm was replaced with gates, but the posts and stub fences remained in place.

The terms of the CPO

12.

The CPO set out, by reference to attached plans with plot numbers (called “Land Interest plans”), the rights which the SoS required (either by way of freehold title or other rights or licences). The plots which are relevant here and the relevant descriptions of the requirement are as follows:

i)

Plot 3/14: this was the plot lying between the route of the A6 and the access: the Highway Land. Title to it was to be acquired from the Wilson Trustees.

ii)

Plot 3/14c: this was described as “For the construction of a joint new private means of access to Rothley Lodge Farm and Rowena Nurseries”. The Plot was subsequently sub-divided so that the access to Rowena Nurseries became 3/14e. The access to the Farm is not relevant. The schedule notes that a licence, rather than title, is required for this means of access. The owners were the Wilson Trustees (now the Appellants).

iii)

Plot 3/31a: this was a section 250 right (i.e. a new right over land, as opposed to title) “For the construction and maintenance of earthworks supporting a joint new private means of access” to the Farm and Rowena Nurseries. Again the owners were the Wilson Trustees.

iv)

Plot 3L/10: title to this was required (although not subsequently insisted on) “for landscaping works”. The owners were the Wilson Trustees.

The terms of the SRO

13.

The SRO identified the new means of access to be provided under the statutory powers by reference to an attached plan. Site Plan 5 which was attached to the SRO identified the private means of access to Rowena Nurseries by the reference numeral 34. The body of the Order said that the site plans showed “the routes along which [the new means of access] are to be provided”. Such routes were shown by diagonal hatching on the plan. Unlike the Land Interest plans, Plan 5 is drawn to scale, and shows that the width of the means of access is of the order of 6 metres.

14.

As required by section 125(3)(b) of the Highways Act, the SRO contained a declaration that the SoS was satisfied that:

“as respects each length of private means of access to premises, the stopping up of which is authorised by this Order, that other reasonably convenient means of access to the relevant premises are available or will be provided in pursuance of this Order …”

The terms of the Signage Agreement

15.

The Signage Agreement gave the Carpenters the right to

“1.1 maintain not more than two signs upon the land coloured green on the plan annexed hereto (“the Land”) stating only the name and nature of the Licensee's business and of a size and design and in a position which shall have been firstly approved by the Owner in writing ("the signs")

1.2 mow the grass on the land”

16.

The licence was terminable by either party by 14 days written notice.

17.

The annexed plan was another version of the Land Interest plan attached to the CPO. The land coloured green was not part of 3/14e, i.e. the land required by the CPO for the construction of the new private means of access. It was a strip of more or less constant width within 3/31b abutting and along the edge of 3/14e.

The Deed of Grant

18.

The Deed records that

"At the request of the Secretary of State and the Grantee… the Owner grants the Rights to the Grantee”

19.

The “Rights” are those set out in the Third Schedule, which provides:

“The full and free right for the Grantee their successors in title the owners and occupiers for the time being of the Grantee's Land and the persons authorised by them:

1. At all times by day or night to pass and repass over and along the Roadway with or without motor vehicles to or from the Grantee's Land from or to the Roundabout subject to the Grantee contributing a reasonable proportion of the costs of maintenance and repair of the Roadway calculated according to use (but without imposing any obligation upon the Owner to carry out any works of maintenance or repair)

2. To enter upon the Roadway and remain thereon (only for as long as reasonably necessary) to maintain and repair the Roadway at the Grantee's own expense

3. Subject to the rights of the Secretary of State to maintain and keep in a neat and tidy condition the Landscaped Area

4. In so far as such rights do not prejudice or interfere with the development or redevelopment of Rothley Lodge Farm to carry out improvements to the Roadway at the Grantee’s own expense having first obtained the Owner’s written consent such consent not to be unreasonably withheld”

20.

By clauses 1.5 and 1.6 of the Deed respectively the term “the Roadway” is defined as the part of the Owner's Land coloured brown on the Plan and the Landscaped Area is defined as that part coloured purple.

21.

The Plan was annexed to the Deed. It is a version of the Land Interest plan, examples of which were annexed to the CPO. The part of the Owner's land coloured brown on the Plan is labelled 3/14e. The Landscaped Area to the east and coloured purple can be seen to be a combination of the two plots: 3/31b and 3/L10.

22.

In addition to the grant of the rights, the Owner undertook an obligation in paragraph 3 “not to permit any vehicles belonging to the Owner … to stand upon any part of the Roadway”.

The approach to interpretation of the Deed

23.

The general approach to construction of the grant was common ground. Evidence of the parties' subjective intentions is not admissible, but evidence of the background circumstances to the grant reasonably known to the parties is (Investors Compensation Scheme Limited v West Bromwich Building Society [1998] 1 WLR 896). As with all exercises in construction, the underlying purpose of the transaction, objectively determined, is important.

24.

The process of construing the Deed is a unitary one with the consideration of the background material that would have been reasonably available to the parties at the time of the grant. That material includes the other relevant instruments and the nature and physical characteristics of the land. As Sir John Pennycuick said in St Edmundsbury v Clark (No 2) [1975] 1 WLR 468 at 477C-F:

“Mr Vinelott contended that the proper method of construction is first construe the words of the instrument in isolation and then look at the surrounding circumstances in order to see whether they cut down the prima facie meaning of the words. It seems to us that this approach is contrary to well-established principle. It is no doubt true that in order to construe an instrument one looks first at the instrument and no doubt one may form a preliminary impression upon such inspection. But it is not until one has considered the instrument and the surrounding circumstances in conjunction that one concludes the process of construction."

25.

Finally, in Chartbrook Ltd v Persimmon Homes [2009] 1 AC 1101; [2009] UKHL 38 at [17] Lord Hoffmann warned against treating defined terms as mere algebraic symbols without giving weight to the meaning of the defined term itself:

"The judge declined to regard [particular defined terms in the contract] as indicative of an intention that MGRUV was to be the minimum Chartbrook would receive as the land value of a flat because both terms were defined expressions. They might just as well have been algebraic symbols. Indeed they might, …. But the contract does not use algebraic symbols. It uses labels. The words used as labels are seldom arbitrary. They are usually chosen as a distillation of the meaning or purpose of the concept intended to be more decisively stated in the definition. In such cases the language of the defined expression may help to elucidate ambiguities in the definition or other parts of the agreement: compare Birmingham City Council v Walker [2007] 2 AC 262, 268."

26.

There are three possible interpretations of the physical extent of the right of way as conferred by the Deed:

i)

over the land coloured brown as mapped on the Plan;

ii)

over all the land lying between, on one side, the eastern boundary of the highway land (i.e. the quickthorn hedge) and, on the other side the rollover point where the verge ends and the embankment begins;

iii)

over the tarmac surface alone as it existed at the date of the Deed.

27.

The first alternative is not contended for by any party. It was common ground that the Plan was schematic, and did not attempt to map features onto the ground. The evidence showed that if one tried to conduct the exercise of marking out on the ground the plots shown on the Plan, treating it as being to scale, one would be driven to the conclusion that the parties intended to grant a right of way over only part of the width of the existing tarmac. Neither party could have intended such a result.

28.

The second alternative is that at which the Judge arrived, although the declaration which she granted only provided that the right was “exercisable” over the land between the fence (rather than the hedge) and the rollover point.

29.

The third alternative is that for which the appellants contended below and contend for on this appeal.

The Judgment

30.

The Judge identified at paragraph 4 of her judgment that the principal cause of the dispute was that the Plan did not provide an accurate representation of the physical features on the land. At paragraph 8 she concluded that:

“The plan is schematic and was drawn before the relevant access roads, or indeed the new A6 were built. It does depict where all the relevant plots are located in relation to each other. It is not a clear indication of the precise dimensions of plots, roadways, or the position of structures such as fences and other boundary structures."

31.

Having set out the terms of the Deed and its background, including the CPO, the SRO and the Land Transfer, the Judge turned to the limited factual disputes before her. She accepted Mr Carpenter’s evidence that he maintained both verges to the access road, both before and after the Deed, so that the public could walk along the verges and because he considered he had a right to do so. She found that on the eastern verge the signs were placed at the top of the right of way (i.e. near the roundabout). So far as the western verge was concerned, signs were usually placed on the verge or on the fence. Only rarely were other signs placed on the eastern verge.

32.

The Judge accepted as “a matter of common sense” the evidence of an engineer, Mr Brown, who said that it was normal practice to leave a one metre verge between a track and fences on either side, to allow for maintenance. In addition these verges ensure that a full width of the track can be used: if fences are tight up to track, vehicles will not use the outer 300-500mm of track, and its effective width will therefore be reduced. However, she rejected as “trespassing on the court’s function” certain further evidence of Mr Brown that a private means of access does not include the verges “by definition”.

33.

The Judge also concluded from her observation of the site that the use of the verges by the Claimant does not in any way impede or affect the defendants’ use of the land. She said that the defendants have no practical use for the parcel of land over which the disputed access runs.

34.

Turning to the construction of the Deed, the judge rejected the appellants’ argument as to the significance of the parties’ choice of the word “Roadway” in the Deed. She rejected dictionary definitions as not particularly helpful, given that the parties had chosen to define “Roadway” in the Deed for themselves by reference to the Plan. She did not find that the word was a clear indication that the parties intended to convey a right of way over only the tarmac area.

35.

What the Judge did find helpful was that the Plan did show the parties’ intentions as to where the land coloured brown lay in relation to the other parcels.

36.

As to the eastern verge, the Judge rejected the appellants’ argument based on the Signage Agreement namely that it related to the eastern verge, and treated the eastern verge as being different from the brown land in the Deed. She relied on a variety of propositions to do so: that the green land was wider than the verge; that it raised questions as to why no right to mow the western verge had been granted; signs had been erected on the western verge; it was clear from the correspondence that the parties regarded 3/31b as the embankment area.

37.

As to the western verge, the Judge rejected the appellants’ argument that it made no sense that the right of way be granted over the land on the highway side of the fence, although this was the effect of treating the right of way as extending over the whole of the brown land.

38.

The Judge also rejected the defendants’ arguments based on the barrier and based on the covenant against allowing motor vehicles to stand on the right of way. She expressed her conclusion in this way:

"Accordingly I find that an objective construction of the [Deed], taking into account the features demonstrated on the plan and which exist upon the site, taking into account matters referred to in the correspondence and the parties use of the area, is that the physical extent of the right of way is from the line of the fence on the western edge of the western verge of the Roadway, to the eastern edge of the eastern verge of the Roadway and that this was what the parties intended when they referred to the "land coloured brown on the plan.”

Argument on the appeal

39.

Mr Randall QC, who appeared on behalf of the appellants, submitted, in essence, that the construction of the Deed arrived at by the Judge was wrong in law because the she gave too much weight to the marking of parcels on the Plan attached to the Deed despite the evidence that the Plan was merely schematic, was produced before the features of the access were in place on the ground and could not by any process of mapping be made to correspond with the features on the ground. He also submitted that she gave little or no weight to the term “Roadway” used in the deed, the SRO plan, which is to scale, the Signage Agreement, the covenant against allowing vehicles to stand and the barriers. He said that weight should be given to the different purpose of the annexed plans in the CPO as compared with the Deed despite the fact that they identified the same plot of land.

40.

Mr McGhee QC, who appeared on behalf of the respondents with Mr Paul Clarke, submitted that the parties plainly intended to treat the whole of 3/14e as the right of way, bounded on the west by 3/14 and on the east by 3/31b. The Land Interest plans were common to the CPO, the Land Transfer and the Signage Agreement. He relied on that fact that the right of way was for vehicles and pedestrians, that the previous access had included verges for pedestrians to use and on the Judge’s finding that there was no obvious alternative use for the verges. He submitted that the Signage Agreement was a wise precaution to regularise the position of the signs, which might arguably be on the embankment. The barrier posts and fences, he submitted, still allowed enough room for pedestrians to pass.

Disposition

41.

I think the most relevant background considerations are these:

i)

The right of way was to be provided at the request of the SoS to provide a reasonably convenient means of access to the respondents’ land to replace the existing access.

ii)

The CPO, in annexing plans which were for the purpose of defining land over which a licence was required for the construction of a joint new private means of access to Rowena Nurseries, was not indicating that the whole width of 3/14c/e was required for the means of access. The use of the plans in the CPO and in the Deed was not for an identical purpose. The former use was to allow adequate access to build a road, the latter was attempting to define a right to pass and repass.

iii)

The SRO identified, to scale, what the SoS considered to be a reasonably convenient means of access. What it identifies is narrower than the whole of 3/14e, and more similar to the tarmac surface actually built. Nevertheless it was the Land Interest plan and not the SRO plan which was incorporated into the Deed.

iv)

By the time the Deed was executed there was in place a clearly defined tarmac road with clearly defined verges on either side which were maintained and kept tidy by Mr Carpenter and which could be used for pedestrians, in the same way as pedestrians had regularly used the old means of access.

v)

The Signage Agreement did not treat the eastern grass verge as part of 3/14e.

vi)

There were posts and fences which partially blocked the verges at the southern end.

42.

When one approaches the Deed against this background, what does one make of the fact that the right of way is granted over the Roadway, which is defined as the land coloured brown on the plan? The Judge’s answer was that the Plan defined the relationship of the plots, so that one could conclude from evidence as to where those plot boundaries were that the Roadway went all the way from the hedge/fence to the rollover point. Both these points were clearly identifiable on the land.

43.

The Judge’s finding that the Plan annexed to the Deed is purely schematic and does not show the precise dimensions of roadways, does not in my judgment exhaust the use to which the Plan can be put. She was right to conclude that the Plan did show the relationship of plots of land. The definition drives one, in determining what the common intention of the parties was, to discover where those plot boundaries lay. This was a matter about which there was no real dispute. So, on the face of it, the parties had chosen to define the width of the “roadway” as being the same as the width of the plot of land. I accept Mr McGhee’s submission that it would take something clear to dislodge this meaning of the Deed.

44.

The Judge reinforced her conclusion about plot boundaries by reference to the parties’ negotiations leading up to the Deed. Here I think she did stray from principle: those negotiations are inadmissible as they simply demonstrate subjective intentions. I therefore exclude those matters from consideration in what follows.

45.

I have concluded that the Judge came to the right conclusion about the meaning of the Deed.

i)

The label used, “roadway”, does not in my judgment either necessarily exclude the verges or necessarily include them. It is at least capable of including the grass verges. Mr Randall had some dictionary definitions which suggested that it meant the metalled surface, but, like the Judge, I am wary of dictionary definitions when the parties have chosen to write their own. For present purposes it is enough to say that “roadway” is not a label which disposes of the issue of construction either way.

ii)

In deciding what is a “reasonably convenient means of access”, it seems to me that one can have regard to what existed before. If what existed before included safe pedestrian access on grass verges, then it is reasonable to expect the new access to provide a similar facility and not force pedestrians to walk in the road.

iii)

It is true that the tarmac surface alone conforms more closely to what is shown in the scale plans attached to the SRO. But the parties did not choose those plans to attach to the Deed. They chose to delimit the right of way by reference to land shown on the Plan.

iv)

The position on the ground at the date of the Deed was absolutely clear. The road had been built and there were two clear grass verges.

v)

The Signage Agreement is not easy to reconcile with either side’s case. If it relates to the verges as opposed to the embankment, it is odd that it confers a right to mow only the eastern verge. On the appellants’ construction there was no right to do anything on the western verge. I think the Judge was right not to place weight on it given the difficulties with it to which she drew attention. Although she was wrong to rely on the correspondence for this purpose, I agree with her in the result.

vi)

It is true that this construction has the logical result that the right of way extends over the land between the fence and the centre of the quickthorn hedge. Mr McGhee accepted that this was so. But the point is more theoretical than real. As the Judge held, the hedge and the fence might have been expected to grow into one another. Together they represented the boundary of usable land on 3/14e. The point does not take the appellants nearly far enough to be able to suggest that the plot boundary construction is not a rational one.

46.

Other points were of significantly less weight. The fences and barrier posts do obstruct the path along the verges. But they also fulfil the purpose of closing off the respondents’ land. Mr Randall soft-pedalled the point about the covenant against stopping on the right of way once he appreciated that a car which stopped on the verge would obstruct part of the roadway as well. Mr McGhee said that if the Deed meant “tarmac surface”, then it could easily have said so. There is something in that, but it is not conclusive. I also see some force in Mr Randall’s submission that it is not impossible that the parties meant something different by Plot 3/14e in the CPO and Deed, given the different purposes of identifying the land in each document. But that point simply makes it all the more surprising that they did not use the SRO plan in the Deed. So it really goes nowhere.

47.

The points I have identified are adequate in my judgment to show that the Judge reached the correct view on the construction of the Deed. Accordingly I propose to make an order dismissing the appeal.

Carpenter & Ors v Calico Quays Ltd & Anor

[2011] EWHC 96 (Ch)

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