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	England and Wales Court of Appeal (Civil Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Adam v Shrewsbury & Anor [2005] EWCA Civ 1006 (28 July 2005) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2005/1006.html Cite as: [2005] EWCA Civ 1006

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IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM WREXHAM COUNTY COURT
Mr Recorder O'Toole
WX201244

		Royal Courts of Justice Strand, London, WC2A 2LL
		28/07/2005

Lord Justice Neuberger :

1. On 31 October 2003, Mr Recorder O'Toole gave a reserved judgment in relation to three issues raised in proceedings brought by the claimant, Gwynfa Myfanwy Adam, against the defendants, Mr and Mrs David Shrewsbury. The defendants succeeded on two of the issues, on which there is no appeal. The claimant succeeded on one issue, and, it is in relation to that issue that the defendants appeal.
2. The claimant is the freehold owner of land called Tan-y-Ffordd at Penrhyndeudraeth, Gwynedd, and the defendants are the owners (or more accurately Mrs Shrewsbury is the owner) of the freehold of land to the south-east and south-west of Tan-y-Ffordd, known as Bryn Coed, Penrhyndeudraeth. The only relevant issue for present purposes is the claimant's contention that, when she acquired Tan-y-Ffordd, she purchased a right of way over part of Bryn Coed, and that she still has the benefit of that right of way, a contention which the Judge accepted. The basic facts upon which the claimant's case as set out in the Judge's excellent judgment was based, are as follows.
3. Until 1967, the two properties were in the same ownership. In 1967, Bryn Coed was transferred to Mr Morris Thomas, who subsequently purchased Tan-y-Ffordd in 1976, so that the properties came back into single ownership. At that time, there was a house on Tan-y-Ffordd (which is still there), but there were no houses on Bryn Coed. Mr Thomas applied for planning permission to erect three houses with garages on Bryn Coed, to the south-east of Tan-y Ffordd. His planning application also involved the construction of a road ("the road") on Bryn Coed so as to obtain access to the three proposed houses and garages. One of the proposed houses ("dwelling 3" on the planning application plan) was to be built close to the boundary between the two properties, and its proposed garage was to be part of a building, the remainder of that building being marked on the plan as "garage for Tan-y-Ffordd".
4. Mr Thomas's planning application was granted on 28 September 1976, and, sometime before 1979 he constructed approximately three-quarters of the length of the road. The remaining quarter of the road was that part nearest to Tan-y-Ffordd, i.e. the north-western section of the road.
5. Following negotiations, on 25 June 1979, Mr Thomas entered into a contract to sell Tan-y-Ffordd to the claimant, and the contract was completed by conveyance dated 27 July 1979. I shall refer to those two documents as "the contract" and "the conveyance".
6. Tan-y-Ffordd, as shown on the plan attached to the conveyance could be described as consisting of one large rectangle and one small rectangle (which I shall call "the site"). The north-western boundary of the large rectangle abuts a public highway, although it has no vehicular means of access thereto. The south-western and south-eastern boundaries of the large rectangle abut Bryn Coed, save that, about halfway along the south-eastern boundary, the site protrudes, as it were, into Bryn Coed. On the plan attached to the conveyance, the site was hatched blue.
7. Clause 2 of the conveyance was in these terms:

"The Purchaser [i.e. the claimant] hereby covenants with the Vendor [i.e. Mr Thomas] that within a reasonable time after the Vendor has at his own expense excavated the garage space hatched blue on the plan hereto annexed to the level indicated on the site plan she will erect a stock proof fence along the [south-eastern and south western] boundaries [including the three protruding sides of the site hatched blue] separating the property hereby conveyed [i.e. Tan-y-Ffordd] from the adjoining land of the Vendors [i.e. Bryn Coed] and the Purchaser further covenants that she and her successors in title will thereafter be responsible for maintaining and repairing the said fence."

8. The plan attached to the conveyance appears to have been copied from the planning application plan, in that it shows two of the proposed houses, one of which is dwelling 3, and the road (or more accurately the unconstructed north-western section of the road) and the garage of dwelling 3, which was to be semi-detached with the garage contemplated on the site.
9. Although the conveyance plan appears to have been hand-copied from the planning application plan, it would seem that the contract plan was photocopied from the planning application plan. Its details are identical to those of the conveyance plan, save that, instead of being hatched blue, as on the conveyance plan, or marked "garage for Tan-y-Ffordd", as on the planning application plan, the site is marked "Space for garage at Tan-y-Ffordd".
10. What I have not so far explained is that, as one goes southeast from the south-eastern boundary of Tan-y-Ffordd, into Bryn Coed, the land falls away pretty sharply. Hence, in order to build that part of the road which had not been constructed by 1979, and, indeed, in order to construct dwelling 3 and its garage, a substantial amount of excavation and levelling work would have to have been carried out. Hence the reference to "excavation" in clause 2 of the conveyance.
11. In her evidence to the Judge, the claimant explained that, before exchange of contracts, she had discussed with Mr Thomas the possibility of erecting a garage on the property, and he explained to her the development he was contemplating of Bryn Coed pursuant to the planning permission, and the fact that that development extended to a garage on the site. In her proof of evidence, she said this:

"I would have a shared garage space alongside the garage for dwelling 3… and… he would be excavating the site. He told me that the excavation would be carried out by him at his expense but once that was done, I would of course have to pay for the cost of erecting a garage on my garage space… He told me that… a roadway would be made to the joint garage space, half of which would serve me and the other half of which would serve dwelling… 3. At that stage it was Mr Thomas's intention to develop the site himself, and I had no reason to doubt him when he was telling me that he would be excavating the foundations for both garages…"

12. Insofar as this statement might be taken as amounting to a suggestion that Mr Thomas agreed that he would carry out the development contemplated by the planning permission, or at least that part of it to which the claimant's evidence referred, it seems clear from other evidence, including the cross examination of the claimant, that there was no question of any such contractual obligation. Indeed, in a letter written by Mr Thomas to his agents, and shown to the claimant before exchange of contracts, he made it clear that he might sell Bryn Coed without further developing it.
13. In fact, albeit sometime after 1979, that was what Mr Thomas did. In 1987, he sold Bryn Coed to the defendants. Since that time, the defendants have constructed one of the three houses permitted under the planning permission namely dwelling 1, which is effectively at the end of that part of the road which had been constructed by Mr Thomas. Accordingly, even now, no building work and indeed no preparatory work of levelling or excavation, has been carried out in connection with the construction of the dwellings 2 or 3 or any associated garage, or indeed of the unconstructed north-western section of the road which would lead to those dwellings, and indeed to the site.
14. In these circumstances, the issue between the parties is whether Tan-y-Ffordd enjoys a right of way along that part of the road which has been constructed and along the line of what would have been the north-western part of the road (i.e. that part of the road linking the road which has been constructed to the site) as the claimant contends, or whether, as the defendants contend, no such right of way exists.
15. In light of the way in which the argument proceeded, it seems to me useful to divide the claimant's case into two stages. The first stage involves the contention that, if Mr Thomas had carried out the excavation referred to in clause 2 of the conveyance, and had constructed that part of the road which remains unconstructed even today, then the claimant would have had a right of way of the whole of the road. The second stage in the claimant's case is that, given that Mr Thomas did not carry out the excavation and did not construct the remainder of the road, the claimant nonetheless has a right of way along the line of the road (both where it has been constructed and where it has not been constructed). This is on the basis that it was, in any event, intended that she should be able to use the site as a garage, and the only sensible way in which she could so use it would be on the basis that she had a right of way over the line of the road.
16. The defendants challenge both stages of the argument. So far as the first stage is concerned, I have no difficulty in accepting the claimant's case. If, as the parties appear to have contemplated at the time of the conveyance, Mr Thomas had fully implemented the planning permission, then he would have completed the road so that it went up to the site, and he would have excavated the site so that a garage could have been constructed on it. That garage would, subject to one point raised by Mr Lamming for the defendants, have given access directly onto the road. In those circumstances, subject, as I have said, to one point, it appears to me that it needs no great reference to any principles (such as I discuss below) as to the meaning and effect of the conveyance to conclude that the parties must have intended the claimant to have the right to use the road for the purpose of obtaining access to and egress from the garage which she could have erected on the site (as envisaged by clause 2 of the conveyance and by the planning permission).
17. The contention advanced on behalf of the defendants, that the claimant would nonetheless have had to have negotiated with Mr Thomas for permission to use the road for such access and egress, which he could have refused, appears to me to be little short of fanciful. The parties had expressly acknowledged in clause 2 of the conveyance that the site could be used as a garage; it was specifically contemplated in that clause that Mr Thomas might excavate the site for that purpose; the circumstance in which he would have done so would have been one in which he would have constructed a road which would have led up to the garage; the only way in which the garage could sensibly be used for its purpose would have been if a motor car could get in and out and could gain access to the highway, and that could only be along the road; and that road was marked as a road on the conveyance plan.
18. The only serious argument to the contrary raised on behalf of the defendants is that use of a garage so constructed would be inconsistent with the fencing obligation in clause 2 of the conveyance. If clause 2 of the conveyance meant that the stock proof fence there referred to can have neither a gate nor a break which is wholly filled in by a building, namely a garage, on the basis that it would then not be a single continuous stock proof fence, but two stock proof fences separated by a building, then the point would be a good one. However, I regard that construction as wholly unreal. It is true that clause 2 of the conveyance has a clear, albeit conditional, covenant to fence on the part of the purchaser, and any rights of the purchaser in relation to the garage could be said to arise more by way of implication, but that does not alter the fact that one has to read the clause in a commercial and holistic way.
19. In my view, if the excavation contemplated by clause 2 is carried out, and the contemplated garage is then built on the site, the obligation to erect a stock proof fence along the whole of the adjoining boundary between Tan-y-Ffordd and Bryn Coed would be satisfied if that fence included a gate (provided the gate was generally kept shut, and, when shut, was stock proof) to enable motor cars to get from the garage on to the road and from the road into the garage, or if the stock proof fence was, as it were, interrupted by the garage, provided that the garage, together with the two portions of the fence, constituted a stock proof boundary.
20. The reasoning of this court in Wheeler –v- JJ Saunders Limited [1996] Ch 19 relied on by the defendants, does not cause me to change this view. It is true that, in that case, Peter Gibson LJ at pp.31H-32A expressed disagreement with an observation of the Judge "that the notion of a fence did not necessarily exclude a gate" on the basis that:

"The function of a gate is different from that of a fence. A gate is intended to prevent ingress and egress only when it is shut. It is of the essence of a gate that it can be opened whereas a fence cannot be opened and… the covenant to fence does not refer to a gate."

21. In their judgments, Staughton LJ and Sir John May did not feel it necessary to decide that point.
22. Even if the view of Peter Gibson LJ was right in that case, it seems to me that it cannot possibly be the law that, in every case where there is a contract to erect a stock proof fence, without any reference to a gate, the covenantor cannot include a gate anywhere in the fence. One only has to contemplate a covenant by the owner of a field to erect a stock proof fence around the whole of its perimeter. Save in the most exceptional circumstances, it cannot have been the intention of the parties to such a covenant that there should be no means of access to, or egress from, the field (save by ladder, pole-vault, glider or the like).
23. Accordingly, the first stage in the claimant's case is made out. I turn to the second stage in the claimant's case, which appears to me to involve much greater difficulty.
24. The case advanced on behalf of the claimant is as follows. As at the date of the conveyance, it is clear that both parties anticipated that the site would be used as a garage in connection with the use of Tan-y-Ffordd. The construction of such a garage was envisaged as involving excavation, partly because of the reference to excavation in clause 2 of the conveyance, and partly because the construction of a garage on the excavated site was the subject matter of the planning permission. The only way in which such a garage could have been used would have been by obtaining access to or along the road, part of which had already been constructed, on Bryn Coed: indeed, that road was shown on the plan attached to the conveyance. Accordingly, the claimant was granted a right of way by implication over the route of the road (i.e. over that part of the road which had already been constructed, and over the land on which the balance of the road would have been constructed) as a means of access and egress to and from the garage. In other words, the claimant's case is that the fact that the parties, both in their negotiations and in clause 2 of the conveyance, envisaged that the site would initially be excavated by Mr Thomas, and only then would be used as a garage, was not an essential feature of the use of that site as a garage.
25. The law in connection with the grant of implied easements and in particular the grant of implied rights of way, in a case such as this was authoritatively stated by Lord Parker of Waddington in Pwllbach Colliery Co. Ltd –v- Woodman [1915] AC 634 at pp.646-7, where he said this:

"The law will readily imply the grant or reservation of such easements as may be necessary to give effect to the common intention of the parties to a grant of real property, with reference to the manner or purposes in and for which the land granted or some land retained by the grantor is to be used. … 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."

26. More recently, in Stafford –v- Lee (1992) 65 P. & C.R. 172, Nourse LJ, after quoting Lord Parker's observations, said this at p.175:

"There are therefore two hurdles which the grantee must surmount. He must establish a common intention as to some definite and particular user. Then he must show that the easements he claims are necessary to give effect to it."

27. Stafford's case was unusual, in that the only relevant information available to the court was the contents of the relevant conveyance, together with a copy of the conveyance plan. In the present case, of course, there is far more information available. However, although each case inevitably turns on its facts, the significance of Stafford's case is that it emphasises that the question of whether the test, laid down by Lord Parker, is satisfied is to be determined in the normal way in a civil case, namely by reference to the balance of probabilities.
28. In my judgment, therefore, the resolution of the issue raised on the present appeal turns on the proper analysis of the common intention of the parties, as gathered from the terms of the conveyance, the position on the ground, and the communications passing between the parties before the execution of the conveyance, which would include the provisions of the contract. Although this court excluded as legally irrelevant any communications between the parties outside the conveyance (unless, of course, there is a claim for rectification) in Scarfe v Adams [1981] 1 All ER 843 at 851, it seems to me that such a conclusion is inconsistent with the general principle that when construing a document (whether or not it relates to land) all the surrounding circumstances should be taken into account. That this aspect of Scarfe's case is not the law was decided by this court in Partridge –v Lawrence [2004] 1 P. & C.R. 176 at p.187.
29. Although the four cases I have so far referred to were all concerned with the transfer or grant of an interest in land (a lease in Pwllbach's case, a transfer in Scarfe's case, the grant of an easement in Partridge's case, and a conveyance in Stafford's case), it seems to me important to bear in mind that the principles relating to the construction and effect of such documents should not, at least as a matter of principle, differ from the principles applicable to the interpretation of bilateral contractual documentation generally. That point is supported by the fact that, in Partridge's case, Peter Gibson LJ specifically relied on guidance given by Lord Hoffmann in ICS Ltd. –v- West Bromwich Building Society [1998] 1 WLR 896 at p.912 to support his conclusion that what might be called extrinsic evidence should not be excluded when interpreting a conveyance or deed of grant. However, I accept that that approach must not be adopted indiscriminately, because documents granting or transferring interest in land will often have been drafted on the basis of principles, or approaches, laid down by courts and referred to and relied on in textbooks, over the years. An obvious example in the field of conveyancing is Pwllbach's case itself.
30. In the present instance, it seems clear that the parties to the conveyance Mr Thomas and the claimant, both anticipated that it was probable but not certain, that Mr Thomas would complete the development permitted by the planning permission on Bryn Coed, and consequently would complete the north-western section of the road, which would involve a fair amount of excavation, which excavation would extend to the site, thereby preparing it for a garage. In those circumstances, as I have already said, it seems to me to follow that the parties anticipated that the claimant would at least be entitled to build a garage on the site, which would then be able to enjoy the use of the road for the purpose of vehicular access and egress to and from the garage.
31. As sometimes happens, the problem that has to be solved in the present case has arisen because the event which the parties anticipated, and consequently catered for in their contract, has not occurred, and because there was no contractual obligation (in this case on Mr Thomas) to make it happen, the court has to decide what the parties would have intended or expected, in light of the fact that the anticipated events have not in fact occurred.
32. In the present case, I consider that the essence of the claimant's argument is that it was intended that the site would be used as a garage, even in the absence of any further development of Bryn Coed. If that is right, then it seems to me that, in light of the authorities to which I have referred, and, perhaps in particular, Stafford's case, it would follow that she should be entitled to the right of way for which she contends, namely a vehicular right of way across the line of the road (whether constructed or not).
33. However, I have reached the conclusion that, whether one confines oneself to the terms of the conveyance, or whether one also takes into account the preceding negotiations (including the execution of the contact) between Mr Thomas and the claimant, it cannot fairly be said that there was an unqualified intention that the site would be used by the claimant as a garage. As already stated, I accept that it was intended that the site would be used as a garage in the event of Mr Thomas carrying out the remainder (or at least the relevant part of) the development of Bryn Coed permitted by the planning permission (and by "the relevant part" I mean the excavation and subsequent construction of the north-western section of the road and/or of dwelling 3 and its garage).
34. So far as the conveyance is concerned, it is to be noted that the only reference to the site being used as a garage is contained in clause 2, which is, as I have mentioned, not drafted primarily as a covenant by Mr Thomas to do anything: it is a covenant by the claimant to fence, albeit that it does not come into force unless and until the site is excavated by Mr Thomas. I am prepared to assume (particularly in light of the words "at his own expense", and when viewed in connection with the conveyance plan and in light of the surrounding circumstances) that clause 2 of the conveyance imposed an obligation of Mr Thomas to excavate the site, but only in the event of his constructing the north-west section of the road and/or dwelling 3 together with its garage.
35. In those circumstances, it seems to me that the natural reading of the conveyance is that the contemplated garage use of the site would, as a matter of commonly expressed (or, more accurately, commonly implied) intention, only occur when and if Mr Thomas (or any successor of his) carried out what I have called relevant development. That point is reinforced, as Ward LJ pointed out during argument, when one considers the topography. While it would be physically possible for the claimant to excavate the site for the purpose of erecting a garage, it would not sensibly be possible for a motor vehicle to drive over the land over which the road had not yet been constructed, without considerable excavation work being carried out on that land, because it is so very steep, and, indeed, substantially above the height of that part of the road which has been constructed. While a dominant owner is undoubtedly entitled to carry out works of repair, and even of improvement, to the servient tenement to enable him to use it, it appears to me to be fanciful to imagine that the parties would have envisaged that, if the physical state of Bryn Coed remained relevantly unchanged (as it still does), the claimant would not merely excavate the site and build a garage, but would also carry out substantial excavation and levelling work on Bryn Coed so as to be able to drive from the garage to that part of the road that had been constructed.
36. On the basis of the terms of the conveyance and from the position on the ground, it is, as I have said, right to say that it was the common intention and understanding of the parties that, if the relevant development was carried out, the claimant would erect a garage on the site. However, it cannot, in my view, fairly be said, on that basis, that it was the common intention, understanding, or even anticipation, of the parties that, if the relevant work was not carried out, the site would be used as a garage.
37. Indeed, it appears to me that if that familiar, if mythical, figure, the officious bystander had asked the parties to the conveyance at the time of its execution, whether, in the absence of the relevant development, the claimant would have excavated the site and built a garage on it, they would either have answered that they did not know, or they would have answered that it was very unlikely. Accordingly, it seems to me impossible to contend that the "essential" test laid down by Lord Parker, namely "that the parties should intend that the subject of the grant [for these purposes the site] should be used in some definite and particular manner [namely a garage]", is satisfied.
38. If one turns to consider the discussions and expressions of intent which passed between Mr Thomas and the claimant prior to the execution of the contract and conveyance, I consider that they merely serve to confirm that conclusion. I accept that the effect of the claimant's evidence in chief, if read on its own, could be read as saying that she understood that Mr Thomas had committed himself to carry out the relevant development. But, once one considers the effect of the evidence she gave in cross- examination, and, in many ways even more importantly, the effect of the contemporaneous documentation (and particularly the letter Mr Thomas sent to his surveyors, and which was copied to the claimant) such a conclusion cannot be justified. It is, thus, clear that the claimant hoped, and may well have expected, that Mr Thomas would carry out the relevant development, but that she was well aware he had no obligation to do so, and that, in particular, he might sell Bryn Coed without carrying out any further development to it, as indeed he did.
39. I do not consider that the contract takes matters any further in this connection. It is true that the site is marked on the contract plan as a garage space, but that is plainly not inconsistent with the notion that it was only firmly intended to become a garage space in the event of the relevant works being carried out, especially as the plan also shows Bryn Coed fully developed in accordance with the planning application, in particular with the road completed, and with dwelling 3 and its garage. In any event, viewed against all the other factors to which I have referred, it appears to me that the words use to describe the site on the contract plan are miles away from being able to displace the effect of the terms of, and plan annexed to, the conveyance, the relevant topographical features, and the communications between the parties.
40. Accordingly, the position appears to me to be as follows. As the parties cannot fairly be said to have had an unqualified expectation, let alone an unqualified intention, that the site would be used as a garage, there can be no question of the claimant being able to contend that, by virtue of implication, she had an immediately enjoyable right of way over the site of the road (i.e. over that part of the road which had been constructed as at the date of the conveyance, and over the land on which the north-western section of the road would have been constructed pursuant to the planning permission) pursuant to the conveyance.
41. However, because the parties intended that the site would be used for a garage if and when the relevant development of Bryn Coed was carried out, I readily accept that the claimant has established that she did have the benefit of some sort of implied right over Bryn Coed pursuant to the conveyance.
42. As I see it, that implied right was either a contractual entitlement to claim a right of way over the whole of the road if and when the relevant work was carried out, or, as seems to me to be the better analysis, an immediate right of way, but one which could only be enjoyed once the north-western section of the road had been constructed. Unfortunately for the claimant, whichever of those two is the proper analysis, her claim must fail.
43. If she had a right of way over the road if and when the north-western section was constructed, then I am of the opinion that that right has expired pursuant to the rule against perpetuities. The applicability of the rule in a case such as this seems to me clear from the analysis of Cross J in Dunn –v- Blackdown Properties Ltd [1961] Ch. 433. While that case was concerned with rights to drainage through pipes constructed in the future, I consider that principle and logic dictate that it must apply equally to a right of way over a road which has yet to be constructed. The one point of distinction in principle which exists between that case and this case is that the provisions of the Perpetuities and Accumulations Act 1964 apply to this case, so that the so-called "wait and see" principle can be invoked. However, as is rightly conceded on her behalf, that cannot assist the claimant here, because more than 21 years have expired since the conveyance was executed, and none of the relevant works, and in particular, the construction of the north-western section of the road has been carried out. Accordingly, the easement would now fail for perpetuity.
44. It seems to me that the same reasoning may well apply if there was here a contract for the grant of a right of way, conditional on the carrying out of the relevant works. Even if it does not, no such contract has ever been registered as a land charge against Bryn Coed, and, consequently, the defendants would have taken free of it when they acquired that property in 1987.
45. On behalf of the claimant, Mr Bickford Smith contended that we should not interfere with the Judge's conclusion that there was an implied right of way granted to the claimant, because the Judge reached that conclusion in light of the evidence, and it is at least in part a conclusion based on inference from primary facts. I see the force of that argument, but I would reject it.
46. First, as I have already mentioned, it seems to me that the Judge was right to conclude that the claimant did have an implied easement over the line of the road; the point upon which I would differ from him is whether that right was, as it were, in possession, or was dependant on the north-western section of the road (and, arguably, dwelling 3) being constructed. Secondly, it does not appear that it was argued below on behalf of the defendants that, if a right of way was granted to the claimant, it was over a road to be constructed, and, in the events which had happened, that right had now failed on grounds of perpetuity. That may well be a point which should be taken into account on the issue of costs, but it was very properly not suggested by Mr Bickford Smith that, even if the point had not been raised below on behalf of the defendant, the claimant could unfairly suffer by its having been raised on appeal. It is a pure argument of law. Thirdly, and in any event, it appears to me that the facts are not really in dispute, now that the Judge in his very full and clear judgment has determined them: the only real issue is one of inference, not primary fact, and the proper inference is, ultimately, a matter of principle or, even, of law.
47. While it is only fair to the Judge, to whom I am indebted for his excellent judgment, to record again that by no means all the arguments advanced before us on behalf of the defendants were put before him, I would allow this appeal.

Lord Justice Clarke

48. I agree.

Lord Justice Ward

49. I also agree.