Gallagher v Rainbow

Gallagher v Rainbow - [1994] HCA 24 - HCA 1987 case summary — Zoe

[58]

The construction of a deed is always for the Court; but, in order to apply its provisions, evidence is in every case admissible of all material facts existing at the time of the execution of the deed, so as to place the Court in the situation of the grantor. An easement over Torrens system land is not created by deed. But a document registered under that system is deemed to be a deed [15] . The principles of construction that have been adopted in respect of the grant of an easement at common law, therefore, are equally applicable to the grant of an easement in respect of land under the Torrens system [16] . 1. Waterpark v. Fennell (1859), 7 H.L.C. 650, at p. 684; [ 11 E.R. 259, at pp. 272-273]; Newcomen v. Coulson (1877), 5 Ch. D. 133, at p. 141; Cannon v. Villars (1878), 8 Ch. D. 415, at p. 420; Callard v. Beeney , [1930] 1 K.B. 353, at p. 360; Johnstone v. Holdway , [1963] 1 Q.B. 601, at p. 612; Shannon Ltd. v. Venner Ltd. , [1965] Ch. 682, at p. 691; Bracewell v. Appleby , [1975] Ch. 408, at pp. 416-417; St. Edmundsbury and Ipswich Diocesan Board of Finance v. Clark [No. 2] , [1975] 1 W.L.R. 468, at p. 477; [1975] 1 All E.R. 772, at p. 779; Proprietors Strata Plan No. 9,968 v. Proprietors Strata Plan No. 11,173 , [1979] 2 N.S.W.L.R. 605, at pp. 610-611. 2. (1859) 7 H.L.C. 650, at p. 684; [ 11 E.R. 259, at pp. 272-273]. This passage was cited and applied by Wright J., as he then was, in Callard , [1930] 1 K.B., at p. 360 in relation to the creation of an easement made by deed. In the same case, Talbot J. said (p. 358) that evidence of the circumstances existing at the date of the deed are admissible "to see whether there is anything in them which makes it impossible or unreasonable to apply the words according to their primary meaning". However, that is too restricted a view of the use of the extrinsic circumstances surrounding the execution of a deed. See St. Edmundsbury , [1975] 1 W.L.R., at p. 477; [1975] 1 All E.R., at p. 779. 3. Real Property Act 1861 Q, s. 35. 4. Grinskis v. Lahood , [1971] N.Z.L.R. 502, at pp. 508-509; Hutchinson v. Lemon , [1983] 1 Qd R. 369, at pp. 374-375.

[64]

If a right of way be granted for the enjoyment of Close A, the grantee, because he owns or acquires Close B, cannot use the way in substance for passing over Close A to Close B. In Bracewell v. Appleby [24] , Graham J. applied this dictum of Romer L.J. and held that the owner of a dominant tenement was not entitled to use a right of way for the purpose of gaining access to a house that he subsequently built on adjoining land [25] . In Jelbert v. Davis [26] , the defendant who owned agricultural land had a right of way to that land over land owned by the plaintiff. Subsequently the defendant converted his land to a caravan park which had more than 200 camping sites. The plaintiff objected to the use of the right of way by caravans and cars that were using the park. The English Court of Appeal held that use of the right of way for such a large number of camping sites was impermissible, as it could not have been within the contemplation of the parties upon the original grant of the easements. The underlying principle was stated by Lord Denning M.R. as follows [27] : [T]he true proposition is that no one of those entitled to the right of way must use it to an extent which is beyond anything which was contemplated at the time of the grant. 1. South Metropolitan Cemetery Co. v. Eden (1855), 16 C.B. 42, at p. 57 [139 E.R. 670, at p. 676]; Harris v. Flower (1904), 74 L.J. Ch. 127, at p. 132; Bracewell, [1975] Ch., at p. 417. 2. (1904) 74 L.J. Ch. 127, at p. 132. 3. [1975] Ch. 408, at p. 418. 4. Harris was distinguished by the English Court of Appeal in Graham v. Philcox , [1984] Q.B. 747 but without doubting its correctness. See also United Land Co. v. Great Eastern Railway Co. (1873), L.R. 17 Eq. 158. 5. [1968] 1 W.L.R. 589; [1968] 1 All E.R. 1182. See also Flavell v. Lange , [1937] N.Z.L.R. 444; Bradbrook & Neave, Easements and Restrictive Covenants in Australia (1981), pars 120-121. 6. Jelbert , [1968] 1 W.L.R., at p. 595; [1968] 1 All E.R., at pp. 1184-1185. See also the cases cited there by Lord Denning: Todrick , [1934] 1 Ch. 190; Malden Farms Ltd. v. Nicholson (1956), 3 D.L.R. (2d) 236.

[84]

One form of the principle is as a technical rule relating to deeds. If a person is named as a party to a deed, but does not execute it, the deed will nevertheless be held to bind him if he knowingly takes the benefit of it. In that form, it is not much more than part of a rule for determining who are to be treated as being parties to a deed. In another form, the rule is that if by an indenture to which A and B were the only parties A granted land to B for life with remainder to C, on terms that the land was to be held subject to certain conditions, then if C entered after B's death and took the land by virtue of the indenture, he thereupon became bound by the conditions, even though he was no party to the indenture. Furthermore, a successor in title to a person bound by a deed may be bound by obligations in the deed if the successor in title takes a benefit conferred by the deed [49] . However, a person who is not a party to or named in a deed is not bound by every one of its obligations merely because that person takes a benefit under the deed. In Rhone v. Stephens [50] , Lord Templeman, with the concurrence of the other Law Lords, said: I am not prepared to recognize the "pure principle" that any party deriving any benefit from a conveyance must accept any burden in the same conveyance. Sir Robert Megarry V.-C. relied on the decision of Upjohn J. in Halsall v. Brizell [51] . In that case the defendant's predecessor in title had been granted the right to use the estate roads and sewers and had covenanted to pay a due proportion for the maintenance of these facilities. It was held that the defendant could not exercise the rights without paying his costs of ensuring that they could be exercised. Conditions can be attached to the exercise of a power in express terms or by implication. Halsall v. Brizell was just such a case and I have no difficulty in wholeheartedly agreeing with the decision. It does not follow that any condition can be rendered enforceable by attaching it to a right nor does it follow that every burden imposed by a conveyance may be enforced by depriving the covenantor's successor in title of every benefit which he enjoyed thereunder. The condition must be relevant to the exercise of the right. 1. [1977] Ch. 106, at p. 289. 2. Rhone v. Stephens , [1994] 2 W.L.R. 429; Halsall v. Brizell , [1957] Ch. 169; E. R. Ives Investments Ltd. v. High , [1967] 2 Q.B. 379; Frater v. Finlay (1968), 91 W.N. (N.S.W.) 730; Rufa Pty. Ltd. v. Cross , [1981] Qd R. 365. 3. [1994] 2 W.L.R., at p. 437. 4. [1957] Ch. 169.

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Judgment (88 paragraphs)

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