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	England and Wales High Court (Chancery Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> P&S Platt Ltd v Crouch & Anor [2002] EWHC 2195 (Ch) (25 October 2002) URL: http://www.bailii.org/ew/cases/EWHC/Ch/2002/2195.html Cite as: [2002] EWHC 2195 (Ch)

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IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

		25 October 2002

H.H. Judge Richard Seymour Q. C. :

Introduction

1. The village of Horning lies on the Norfolk Broads. It is bounded on one side by the River Bure. One of the principal roads through the village is Lower Street. To the north-east of Lower Street, that is to say on the inland side in relation to the River Bure, at the south-eastern end of the village there is an hotel called Petersfield House Hotel. In this judgment I shall call that hotel and its immediate curtilage, that is to say the grounds surrounding it on the north-east side of Lower Street, other than the house and curtilage called Robin's Nest (to which I shall refer in this judgment as "Robin's Nest") and an area of car parking occupied with land to the south-west of Lower Street and bordering the River Bure called Noosa Sound (to which area of car parking I shall refer in this judgment as "the Car Park") "the Hotel". The land called Noosa Sound I shall refer to in this judgment by that name. Noosa Sound is part of an island in the River Bure. Access from Lower Street is by means of a footbridge over a lagoon on the inland side of the River Bure. In this judgment I shall call that lagoon "the Lagoon". On the land called Noosa Sound there is now a bungalow ("the Bungalow"). On the Lagoon side of Noosa Sound there are moorings for boats which in this judgment I shall call "the Lagoon Moorings". How many boats can be moored at the Lagoon Moorings depends upon the size of the boats, but in ordinary circumstances the Lagoon Moorings seem to amount to sufficient space to moor two boats. On the river side of Noosa Sound there are also moorings. In this judgment I shall refer to those moorings as "the River Moorings". In ordinary circumstances the River Moorings seem to provide enough room to moor three boats.
2. By a conveyance dated 1 April 1985 and made between (1) Eric John Colchester and Beryl Kathleen Colchester and (2) Philip John Crouch and Gwendoline Sylvia Crouch, who are the defendants in this action, Mr. and Mrs. Colchester conveyed to Mr. and Mrs. Crouch the Hotel, the land upon which Robin's Nest was subsequently built, the Car Park, and Noosa Sound.
3. Mr. and Mrs. Crouch have a son, Mr. Robin Crouch. Mr. Robin Crouch assisted in the running of the hotel business at the Hotel and eventually, as I understand it, he effectively managed the business on behalf of his parents. At all events, it was decided at some point that a house should be constructed for him in part of what until this happened had been the grounds of the Hotel. The house constructed for Mr. Robin Crouch and his family was Robin's Nest.
4. The Bungalow at Noosa Sound was described in this way in a report prepared by a valuer, Mr. Kenneth Hammond, on behalf of the defendants for the purposes of the trial before me:-

"6.1 On the property is a detached bungalow residence of timber framed construction on timber piles under an asbestos tiled roof.

6.2 The bungalow was erected some fifteen years ago and was built by Wroxham Builders Ltd, a well known and very reputable local firm.

6.3 Accommodation

The accommodation comprises:

WRAP AROUND VERANDAH

ENTRANCE HALL; cupboard with hot water tank.

BATHROOM; with shaped corner bath, jacuzzi and mixer tap with shower attachment; matching shell pattern pedestal wash basin and low level suite; fully tiled walls; towel rail; mirror; shaver point; storage cupboard.

KITCHEN/DINING ROOM, 14' x 11' 3" average; with oak faced wall and base units; fitted stainless steel sink; hot and cold mixer tap; fitted electric cooker with ceramic hob; built-in fridge/freezer; washer/drier and dishwasher.

SITTING ROOM, 16' x 14'; picture window with two sets of sliding glazed doors; fitted wall lights; fitted ceiling fan.

BEDROOM, 13'9" x 14'; casement doors to verandah; fitted wardrobe cupboard and bed head with bedside cupboards; fitted dressing table unit.

6.4 The property is fully double glazed with UPVC windows. It is also fully centrally heated with electric Scandinavian pads above the ceiling plaster and thermostats in every room."

5. As I understand it, Mr. and Mrs. Philip Crouch had the Bungalow constructed for their own use originally. However, in recent times the Bungalow, but not the rest of Noosa Sound or the River Moorings, has been let. On the evidence put before me, until about 2 September 2002 the tenant was a Mr. Richard O'Brien. According to the evidence of Mr. Robin Crouch in paragraph 3 of his witness statement dated 25 July 2002, which I accept on this point, as at about May 2001:-

"The Cottage at Noosa Sound (but not the grounds or moorings) was occupied by a Mr. Richard O'Brien under an arrangement whereby he had agreed to vacate the premises if my parents required them back on receiving 2 month's notice. The moorings adjoining the River Bure were used by the Hotel and 2 other moorings at Noosa Sound [that is, the Lagoon Moorings] were separately let for that season. "

6. As at about May 2001 there were two signs along the bank of the River Bure in the grounds of Noosa Sound which advertised the Hotel. According to the oral evidence of Mr. Robin Crouch, which again I accept on this point, those signs were in fact paid for by the well-known Adnams Sole Bay Brewery of Southwold, Suffolk and were erected some time in about September 2000. They replaced earlier signs. Photographs of the signs were put in evidence before me. Apart from the name and telephone number of the Hotel there was on each a list of the amenities offered by the Hotel, not the least of which was the availability of Adnams beer. The list included:-

"Moorings are Strictly for Hotel Customers (Overnight Moorings are for Restaurant Patrons Only)"

7. By each of the River Moorings, as at about May 2001, was a sign apparently also paid for by Adnams Sole Bay Brewery which on the River Bure side carried the name of the Brewery under the words "Moorings Reserved For", followed by a space in which a name could be written in chalk. On the inland side of the mooring signs appeared these words:-

"WARNING

The River Can Be Dangerous

The Management Accepts No Responsibility For Accidents On This Property

(Children should be supervised at all times)"

8. As at about May 2001 there was a sign on the footbridge leading to Noosa Sound, which, from the colour and style as shown in a photograph put in evidence before me, seems to have been one of the Adnams financed signs, which read:-

"WARNING

This Is A Private Mooring. For The Exclusive Use Of Hotel Customers. Others Will Be Treated As Trespassers And Offending Boats Will Be

TOWED AWAY

By Order of the Proprietor. (You have been Warned)."

9. At the Lower Street end of the footbridge leading to Noosa Sound in about May 2001was a sign of which a photograph was put in evidence before me and which Mr. Robin Crouch told me in his oral evidence had probably been there for some considerably longer time than the Adnams financed signs. This sign read:-

"PRIVATE

No public right of way

Hotel Residents Only"

10. In his witness statement dated 25 July 2002, in evidence which I accept, Mr. Robin Crouch said this about the use of moorings for the Hotel during the time his parents owned it and about fishing by guests of the Hotel during that period:-

"14. When my parents owned the Hotel, the moorings which were used by visitors to the Hotel were on the frontage of Noosa Sound to the River Bure. There were 2 separate mooring plots in the lagoon which were let, and the house at Noosa Sound was usually let. The river frontage moorings could take a maximum of 3 boats moored alongside in a line. Mooring "stern on" was not permitted. We had enquired about "stern on" mooring being permitted when we could have allowed up to 8 or 9 boats to moor, but this was rejected by the Broads Navigation Authority as it would have restricted the navigable width of the river. As I have said, 3 boats were the maximum but it was most comfortable with 2 boats. Signs were erected indicating the moorings which could be used by visitors to the Hotel. I used to supervise these moorings and to ensure that they were only used by visitors to the Hotel. They would often be "booked" by visitors. We only had a significant number of users of the moorings and visitors to the Hotel therefrom between April and September. I estimate that the moorings were used by no more than 10 boats per week between April and September. On the Friday and Saturday nights, there would be 2 or 3 boats moored there each night and perhaps 1 on Sunday night and perhaps 3 to 4 other boats moored during the course of the week. When my parents had purchased the property in 1985 a mooring fee was levied for Hotel visitors which was redeemable on dining in the Hotel restaurant. This practice was discontinued shortly afterwards when the Cottage was built at Noosa Sound as my parents private residence.

15. I have estimated the trade from the moorings at approximately 2.87% of annual turnover. The season between April and September is a little less than 6 months. At 10 boats per week for say 24 weeks, there would be 240 boats which would visit. The boats vary in size between 2, 4, 6 and 8 berth sizes but it is rare that an 8 berth boat is occupied by more than say 4 people. I have therefore assumed an average of 3 people per boat. We were not often visited by families. This would amount to 720 people per year at an average spend of £15.00 per head which amounted to £10,800.00 per annum. Turnover was £376,299.00 as referred to in the Particulars of Sale…

17. Guests of the Hotel would only fish at Noosa Sound very occasionally while my parents owned the Hotel. I would estimate about 6 times a year. We had advertised fishing facilities in our Hotel leaflet and on our website."

11. Mr. Paul Bartrop is a director of Robert Barry & Co. Ltd. ("Barry"). Barry is well-known as a specialist estate agent dealing with sales of hotel, leisure and licensed property. A witness statement from Mr. Bartrop dated 25 July 2002 was put in evidence before me. Mr. Bartrop was not required to attend for cross-examination at the trial, his evidence being agreed. He said that he was instructed by Mr. and Mrs. Philip Crouch to deal with a sale of the Hotel. He did not in his witness statement say when he received instructions, but file notes which he made were put in evidence as unchallenged, and these recorded, amongst other things, Mr. Robin Crouch speaking to him on 6 April 2001 about the terms of sales particulars which Mr. Bartrop had prepared. From that I infer that Mr. Bartrop had probably received his initial instructions some days prior to 6 April 2001. Mr. and Mrs. Philip Crouch seem now to live, at least during the European winter months, in Queensland, Australia. At all events, Mr. Bartrop's notes indicate that most of his dealings over the sale with his clients were through their agent, Mr. Robin Crouch.
12. A copy of the sales particulars prepared by Barry and circulated to prospective purchasers ("the Particulars") was put in evidence. The Particulars covered two pages. The front page showed photographs of the Hotel, stated the name and address of the Hotel, and went on:-

"Imposing 18 bedroom country hotel in the select Broadland village of Horning

18 en-suite letting bedrooms

Restaurant, bar, lounge, marquee

Landscaped gardens, detached bungalow

Good profits on net turnover £376,299

Offers around £775,000 FREEHOLD"

The reverse of the Particulars included:-

"Website

www.petersfieldhotel. co. uk

Trade

Petersfield House Hotel is one of the best regarded hotels on the Norfolk Broads its reputation ensuring that it profits from the substantial volumes of trade that the area attracts. In addition, the hotel is well placed within an easy drive of Norwich, which in its surrounding area has a population of over 300,000 people. The trading and profit & loss accounts for the year ended 31^st March 2001 show good returns on turnover net of VAT of £376,299.

Price

Offers are invited in the region of £775,000 freehold and complete with goodwill and trade contents (according to inventory), excluding any personal items. Stock at valuation.

Other Properties

Detached house: Adjacent to the hotel with 3/4 bedrooms (master bedroom en suite with spa bath) dining room, kitchen, sitting room, bathroom/wc and downstairs wc

Luxury riverside bungalow: One bedroom with jacuzzi spa bath, kitchen, lounge, veranda, moorings and garden

Both these properties are available by separate negotiation."

13. A copy of a print-out of the website of the Hotel business was put before me. The print-out referred to "our private riverside moorings". Under the rubric "Fishing and Moorings" appeared, amongst other things, this:-

"The riverside moorings at the hotel are lovely place to spend a lazy afternoon. You can watch the boats go by, feed the ducks, enjoy the wildlife or do a spot of fishing. The Norfolk Broads & the River Bure are well known for the great fishing with 20lb pike and large bream being caught reguarly [sic]. Fishing guides can be arranged."

14. According to the uncontested evidence of Mr. Bartrop, on 8 May 2001 Mr. Peter Platt got in touch with him to arrange to view the Hotel. The viewing actually took place on 22 May 2001. The next day Mr. Platt made contact with Mr. Bartrop and made an offer to purchase the Hotel for the sum of £675,000. He also said that he would like an option to purchase Robin's Nest and an option to purchase Noosa Sound.
15. I shall have to return to the course of negotiations from the point at which Mr. Platt made his first offer on 23 May 2001. However, what ultimately happened was that an agreement ("the Hotel Sale Agreement") dated 31 August 2001 was made between (1) Philip John Crouch and Gwendoline Sylvia Crouch, called in the Hotel Sale Agreement "the Seller", (2) Robin Peter Crouch and (3) P and S Platt Ltd., the claimant in this action and called in the Hotel Sale Agreement "the Buyer", whereby, so far as is presently material, it was provided in clause 2:-

"Agreement for sale

The Seller shall sell and the Buyer shall purchase the Business as a going concern and the Assets and the Goodwill and the benefit (so far as the Seller can assign the same) of the Contracts at the Purchase Price."

Clause 1 of the Hotel Sale Agreement contained the following definitions of expressions used in clause 2 which are relevant:-

" "the Assets" the Freehold Property the Equipment (and all other assets of whatever nature owned by the Seller and employed in the Business at the Completion Date)

"the Business" the Business of an Hotel carried on by or on behalf of the Seller at The Petersfield House Hotel the Freehold Property

"the Completion Date" 14^th September 2001

"the Freehold Property" the property described in the First Schedule including the buildings, fixtures and fittings thereon

"the Goodwill" the goodwill of the Business including the right in so far as the Seller can grant the same for the Buyer to represent itself as carrying on the Business in succession to the Seller"

The property described in the First Schedule to the Hotel Sale Agreement was simply specified as "The Petersfield House Hotel Lower Street Horning Norfolk NR12 8PF as edged red on the Plan attached for identification purposes". The claimant is a company formed by Mr. Peter Platt and his wife Susan as the vehicle through which they intended to carry on the business of the Hotel. In this judgment I shall refer to the claimant as "the Company".

16. By clause 11 of the Hotel Sale Agreement the Standard Conditions of Sale, 3^rd edition ("the Conditions") were incorporated into the Hotel Sale Agreement insofar as applicable to a sale by private treaty and not inconsistent with the other terms of the Hotel Sale Agreement. The Conditions included condition 3.4:-

"Retained land

3.4.1 The following provisions apply where after the transfer the seller will be retaining land near the property.

3.4.2 The buyer will have no right of light or air over the retained land, but otherwise the seller and the buyer will each have the rights over the land of the other which they would have had if they were two separate buyers to whom the seller had made simultaneous transfers of the property and the retained land.

3.4.3 Either party may require that the transfer contain appropriate express terms."

17. Also on 31 August 2001 an agreement ("the Option Agreement") was made between (1) Philip John Crouch and Gwendoline Sylvia Crouch and (2) the Company whereby Mr. and Mrs. Philip Crouch granted to the Company an option to purchase property described as

"First the land and bungalow abutting the Broads including the moorings and known as "Noosa Sound" as edged red on the Plan attached for identification purposes only SECONDLY the land (formerly part of The Petersfield House Hotel) as coloured red on the Plan attached having dimensions of 40 feet by 40 feet."

The land described secondly was the Car Park. The purchase price specified for the exercise of the option was £200,000. The period within which the option could be exercised was specified as up to 28 February 2002.

18. Completion of the sale of the Hotel took place on 14 September 2001.
19. The Company failed to exercise the option to purchase Noosa Sound and the Car Park within the period granted by the Option Agreement.
20. In his witness statement dated 25 July 2002 at paragraph 10 Mr. Robin Crouch, in evidence which I accept, explained what then happened:-

"The Claimant failed to exercise the Option before 28^th February 2002. A day or two afterwards, I was contacted by Mr. Platt. He acknowledged that they had not exercised the Option in time but he said they did want to exercise the Option and that "as we were mates" he hoped that we could agree this. I told him that my father had decided to keep the property and that it was no longer for sale. He asked me if I would speak to my father again to see if he would change his mind, Colin Palmer & Co. [solicitors at that time acting on behalf of Mr. and Mrs. Philip Crouch] wrote to the Buyer's solicitors, Lionel Lewis, by fax on the 1^st March 2002 requesting that the C(iv) Land Charge Entries protecting the rights under the Option Agreement be cancelled and that they be provided with copies of the Cancellation slips for their files. On 4^th March 2002 I telephoned Mr. Platt to advise him that my father would not change his mind. He became very angry and told me that if that was the case and if he could rent the property next door (Rivermead), he would make life very difficult for us, he would report us to the taxman so that we would be subjected to a lengthy and expensive tax investigation and he would make it very difficult for us to sell the property to anyone else. He also said that he had had enough and had "lost the plot". He blamed his solicitor who he said had failed to advise him in writing of the expiry date of the option and said that he would be suing him."

21. There was put before me as uncontested evidence a witness statement of Mr. Clifford Moore, who is a handyman who works in Horning. He said that he was asked on 3 March 2002 by Mr. Robin Crouch and Mr. Philip Crouch to paint out the signs at Noosa Sound indicating that there was mooring for visitors to the Hotel, to take down the old signs, to erect "No Mooring" signs and to put up a gate on the footbridge leading from Lower Street to Noosa Sound. Mr. Moore said in his statement that he started work on 6 March 2002, but was interrupted by Mr. Platt, who objected to what he was doing.
22. This action was commenced by a claim form issued on 18 April 2002.
23. While I have not heard any evidence from Mr. Philip Crouch, there is a temptation to think that, as he now has a home in Australia and Mr. Robin Crouch has apparently also moved to Australia, what prompted him, after the Company failed to exercise the option to purchase Noosa Sound within the period for which the Option Agreement provided, to say that he was not prepared to sell Noosa Sound any longer was not a genuine desire to retain Noosa Sound and the rather small Bungalow, but a wish to exploit what he seems to have seen as an opportunity to extract an increased price for Noosa Sound. Certainly the promptness with which Mr. Philip Crouch's solicitors sought to bring to the attention of the Company's solicitors that the option period had expired, coupled with the instructions to Mr. Moore, seem calculated to seek to bring home to Mr. Platt what may have been thought to be the implications of the option not having been exercised, namely that guests of the Hotel could no longer use the River Moorings. At the same time, on the other side, consideration seems to have been given promptly to seeking to mitigate what might otherwise have been thought to be the implications of the option to purchase Noosa Sound and the Car Park not having been exercised during its currency. In a letter dated 6 March 2002 to Messrs. Colin Palmer & Co. Messrs. Lionel J. Lewis & Co. wrote as follows:-

"Following our telephone conversation of last Friday, it is accepted that the option for the purchase by our clients of the land and house at "Noosa Sound" was not exercised and the right to acquire that property is no longer exercisable. You have requested that our clients withdraw the land charge and we are taking steps to do this.

The property, of course, remains that of your clients but certain rights still remain in favour of P and S Platt Limited and which passed to our clients by virtue of the transfer of 14^th September, 2001, both under Section 62 of the Law of Property Act 1925 and under the Rule in Wheeldon v. Burrows. The transfer, of course, was a disposition to our clients from property previously in one ownership and where under Section 62 our clients were entitled to all quasi easements, advantages and accommodation which benefited the quasi dominant tenement unless a contrary intention had been expressed in the conveyance to our clients. No such contrary intention was expressed.

Under Wheeldon v. Burrows there also passed those rights and advantages which have been continuous, apparent and reasonably necessary for the enjoyment and convenience of the property transferred.

The mooring posts were marked for the benefit of The Petersfield House Hotel. The advertising board was clearly for the benefit of the Hotel and not the retained land. These were, therefore, accommodations attaching to the quasi dominant tenant and passing under Section 62.

These easements have also been continuous and very much apparent and reasonably necessary for the enjoyment and convenience of the Hotel bearing in mind that it is a Hotel close to the Norfolk Broads for the benefit of the people visiting the Broads. Moreover, the website of the Hotel which had been designed by your clients had included the private moorings as being one of the Hotel's facilities.

Since the completion of the purchase, our clients have continued to exercise those rights. Had they completed the purchase of the option, those rights would have been extinguished by unity of seisin. The fact that our clients have not exercised the option leaves the rights that have continued since purchase, to continue in perpetuity.

Added to those rights, of course, is the right of access to the moorings and the advertising site.

Our clients, therefore, have a legal easement which is also being registered at the Land Charges Registry. "

24. The issue in this action is whether the assertions made in the letter dated 6 March 2002 by Messrs. Lionel J. Lewis & Co. are well-founded.

The relief sought in this action

25. At paragraph 2 of the Particulars of Claim in this action it was pleaded:-

"At the time of the Transfer [of the Hotel to the Company] there was appertaining to or reputed to be appertaining to or enjoyed with or reputed or known as part or parcel of or appurtenant to the land thereby transferred the following:-

(i) The right for the Hotel's residents or customers (or prospective residents or customers) to moor boats at the location of the 3 moorings marked A, B and C on Plan B annexed hereto ("the Plan");

(ii) The right to locate and display 3 mooring signs (naming the Hotel) at the 3 moorings marked A, B and C on the Plan B.

(iii) The right to locate and display 2 large boards (naming and advertising the Hotel) at the places shown and marked D and E on the Plan B.

(iv) The right for the Hotel's residents or customers to fish at the location of the 3 moorings marked A, B and C on Plan B.

(v) A right of way on foot for the Hotel's residents and customers (or prospective residents or customers) between the moorings marked A, B and C along the pathway marked brown on Plan B to the public highway called Lower Street.

(vi) A right to locate and display signs advising the Hotel's customers of the said pathway at the places marked F and G on the Plan B."

In this action the Company seeks a declaration that it has the rights alleged and an injunction restraining Mr. and Mrs. Philip Crouch from interfering with those alleged rights.

26. In the Defence and Counterclaim at paragraph 3 it was admitted that the rights claimed in the Particulars of Claim were benefits or advantages enjoyed by the Hotel when the defendants owned it. However, it was contended that it was the intention of the parties to the Hotel Sale Agreement that the ability of the Company to continue to enjoy those benefits or advantages should cease unless the Company exercised the right to purchase Noosa Sound given by the Option Agreement. In particular reliance was placed upon the terms of a letter dated 9 August 2001 written by Messrs. Colin Palmer & Co. to Messrs. Lionel J. Lewis & Co., to which I shall refer in this judgment as "the Letter". It was denied that the rights alleged appertained or were reputed to appertain to or were enjoyed with or were reputed or known as part or parcel of the Hotel. It was alleged that the claimed right to moor boats at the River Moorings and the claimed right to locate and display mooring signs, as well as the claimed right to fish, would amount to exclusive possession of the River Moorings, and thus could not exist as easements. It was denied that the claimed right to fish was continuous and apparent or obvious. At paragraph 6 of the Defence and Counterclaim it was pleaded that:-

"If (contrary to the Defendants' claims set out in paragraphs 2 – 6 above) the rights set out in paragraph 2 did vest in the Claimant as a result of the Transfer, the Defendants will seek rectification of the Transfer as pleaded in the Counterclaim herein."

The Counterclaim pleaded in paragraph 10 of the Defence and Counterclaim was:-

"Notwithstanding the matters pleaded in paragraph 2 of this Defence, the parties failed to include in the Transfer a provision that s.62 of the Law of Property Act 1925 would not operate to vest in the Claimant the rights claimed over Noosa Sound. This omission was the result of mutual error."

The Law

27. By Law of Property Act 1925 s. 62(1) it is provided that:-

"A conveyance of land shall be deemed to include and shall by virtue of this Act operate to convey, with the land, all buildings, erections, fixtures, commons, hedges, ditches, fences, ways, waters, watercourses, liberties, privileges, easements, rights, and advantages whatsoever, appertaining or reputed to appertain to the land, or any part thereof, or, at the time of the conveyance, demised, occupied, or enjoyed with, or reputed or known as part or parcel of or appurtenant to the land or any part thereof. "

By Law of Property Act 1925 s.62(4), however,

"This section applies only if and as far as a contrary intention is not expressed in the conveyance, and has effect subject to the terms of the conveyance and to the provisions therein contained."

28. It was common ground before me between Mr. Mark Warwick, who appeared on behalf of the Company, and Mr. Nicholas Caddick, who appeared on behalf of Mr. and Mrs. Philip Crouch, that no intention to modify or exclude the operation of Law of Property Act 1925 s.62 was expressed in the transfer of the Hotel to the Company by Mr. and Mrs. Philip Crouch. Indeed it was accepted by Mr. Caddick, that the effect of condition 3.4 of the Conditions was that the effect of Law of Property Act 1925 s.62(1) was expressly incorporated into the Hotel Sale Agreement.
29. It was not seriously in dispute before me that, in general terms, a right to moor boats to a mooring post is an established category of easement – see Lancaster v. Eve (1859) 5 CB (NS) 717.
30. Equally, it was not seriously in dispute that the provisions of Law of Property Act 1925 s.62 applied not only to legal rights actually in existence at the date of the relevant conveyance, but also, on severance of a piece of land in common ownership, to quasi-easements in fact enjoyed by one part of the land over another. Mr. Warwick reminded me of the decision in Wright v. Macadam [1949] 2 KB 744 and of the following observations of Jenkins LJ, giving the leading judgment, at page 748:-

"The predecessor of s.62 of the Act of 1925, in the shape of s.6 of the Act of 1881 has been the subject of a good deal of judicial discussion, and I think the effect of the cases can be thus summarized. First, the section is not confined to rights which, as a matter of law, were so annexed or appurtenant to the property conveyed at the time of the conveyance as to make them actual legally enforceable rights. Thus, on the severance of a piece of land in common ownership, the quasi easements de facto enjoyed in respect of it by one part of the land over another will pass although, of course, as a matter of law, no man can have a right appendant or appurtenant to one part of his property exercisable by him over another part of his property. Secondly, the right, in order to pass, need not be one to which the owner or occupier for the time being of the land has had what may be described as a permanent title. A right enjoyed merely by permission is enough."

31. What Mr. Caddick submitted was that in the present case the right to moor claimed would amount to depriving Mr. and Mrs. Philip Crouch in substance of the beneficial user of that part of Noosa Sound over which the right of mooring was claimed because the right claimed was an exclusive right for the patrons of the Hotel. In support of that submission Mr. Caddick drew to my attention a decision of Upjohn J, Copeland v. Greenhalf [1952] 1 Ch 488, and a recent decision of the Court of Appeal, Batchelor v. Marlow (2001) 82 P&CR 459. Both of those cases were cases in which the claimed right was a right to park vehicles. The issue thus was, if land had to be kept available for the parking of vehicles, what other beneficial use could the landowner make of it? The present case is, on the facts, completely different. So far as mooring is concerned, the only way in which the use of the land at Noosa Sound is affected is that the maintenance in place of mooring posts must be permitted. That, of itself, amounts to a minimal interference with the use of Noosa Sound. The substance of Mr. Caddick's submission seemed to be that the right claimed would prevent the owner of Noosa Sound from mooring at the River Moorings. If I found that the right to moor existed and was an exclusive right, it would be correct that the owner of Noosa Sound would not be able to use the River Moorings. However, the effect of that on the use of Noosa Sound would be minimal. It would not affect what could be done on the actual land at all, and if and insofar as it is appropriate to have regard to use of the land ancillary to what was actually use of the waterways surrounding Noosa Sound, the owner of that property could use the Lagoon Moorings. I therefore reject Mr. Caddick's submission.
32. I think that Mr. Caddick sought to support his contentions as to the effect of the exercise of rights of mooring on the River Moorings exclusive to the customers of the Hotel by relying also on the notices identifying the locations of the River Moorings located by each. Again, it was not seriously in dispute that the right to place and to maintain a notice or sign is an established category of easement – see Hoare v. The Metropolitan Board of Works (1874) LR 9 QB 296. The exercise of the rights claimed in relation to the signs at the points marked A, B and C on Plan B attached to the Particulars of Claim seems to me to involve minimal interference with the beneficial use of Noosa Sound.
33. Mr. Caddick also sought to support his submission in relation to the effect of the existence of the claimed rights to exclusive use of the River Moorings by reference to the expert evidence of Mr. Hammond, to which I have already made some reference. Mr. Hammond told me that he considered that the value of Noosa Sound subject to the rights claimed would be about half of its value not subject to those rights. I cannot see that that evidence is of any relevance to any issue which I have to determine, so I have simply disregarded it.
34. On the evidence, the relevant parts of which I have already set out in this judgment, I find that certainly up to the date of the Letter, to the significance of which I shall come, the use by customers of the Hotel of the River Moorings and the placing and maintaining for the purposes of the business of the Hotel of the various signs pleaded in paragraph 2 of the Particulars of Claim were benefits or advantages appertaining or reputed to appertain or enjoyed with or appurtenant to the Hotel, meaning by that, for the avoidance of doubt, the land upon which the hotel building stood. I am not satisfied that the use of the River Moorings by customers was exclusive. Although the evidence about it was thin, I think it unlikely that in indicating that the River Moorings were available for use by patrons of the Hotel, Mr. and Mrs. Philip Crouch were intending to disable themselves from the use of the River Moorings if they otherwise wished to do so. That said, there was no positive evidence of use of the River Moorings by anyone residing at the Bungalow or by Mr. and Mrs. Philip Crouch. As the Lagoon Moorings were sometimes let, at least while they were let Mr. and Mrs. Philip Crouch would have no use of any moorings unless they could use the River Moorings.
35. I am not satisfied on the evidence that any use was made of the bank of the River Bure at Noosa Sound by patrons of the Hotel for fishing sufficient for one to be able to say that there was continuous and apparent use which appertained to, or was reputed to appertain to, or was enjoyed with, or appurtenant to, the Hotel. All the evidence shows was that the opportunity for fishing was advertised, but rarely taken advantage of.
36. Mr. Caddick frankly made plain in his closing submissions that his clients' principal case was that any benefits or advantages relating to Noosa Sound of which the Hotel had previously availed itself were not intended to pass with the transfer of the Hotel to the Company, and thus did not pass. The foundation in law for that submission was said to be the decision of the Court of Appeal in Birmingham, Dudley and District Banking Co. v. Ross (the"Birmingham Case") (1888) 38 Ch. D. 295, which has recently been applied by the Court of Appeal in Selby District Council v. Samuel Smith Old Brewery (Tadcaster) (the "Selby Case") (2000) 80 P&CR 466.
37. The Birmingham Case arose out of a scheme of Birmingham Corporation for the carrying out of a development of land which it owned by demising plots with or without newly erected buildings to persons interested in taking them. The Corporation demised a plot with a newly erected building to the claimants and subsequently demised a plot with an old building of a certain height to the defendant. The defendant then demolished the existing building on the plot demised to it and erected a higher building which reduced the amount of light received by the building on the plot demised to the claimant. The issue was whether the effect of Conveyancing Act 1881 s.6, the statutory predecessor of Law of Property Act 1925 s.62, was that rights to light over the plot later demised by the Corporation to the defendant were deemed to have passed on the demise to the claimant. The leading judgment in the Court of Appeal was that of Cotton LJ. At pages 307 – 308 of the report Cotton LJ said this:-

"But in my opinion, even with the assistance afforded us by the language of this deed, this could not be said to be a light, within the meaning of this section, enjoyed with the house. The house had only recently been erected; and at the time when this lease was granted it was obvious to both parties that this was a large tract of land bought by the corporation of Birmingham for the purpose of effecting an improvement, and for the purpose of the land being laid out so as to have buildings upon it, and at the time when the lease was granted Corporation Street had only just been formed: there was no plan of the buildings upon it, but it was the duty of the corporation, as of course it would be their interest, to lay this out in such a way as to make it available for recouping the expenses, and also to be an improvement to this portion of Birmingham. Therefore, I think it could not be said that the light coming over that low building to these windows could be considered as enjoyed with it within the meaning of this section. The light did in fact at the time come over that building; but it came over it under such circumstances as to shew that there could be no expectation of its continuance. It had not been enjoyed in fact for any long period; and in my opinion it was enjoyed under such circumstances, known to both parties, as could not make it light enjoyed within the meaning of that section. The expression must mean not light which a person has a right to under the statute, but that which he has enjoyed under circumstances which would lead to an expectation that the enjoyment of that light would be continued, and that it would not be simply precarious."

Bowen LJ at pages 315 – 316 made comments to similar effect.

38. The attention of the Court of Appeal in Wright v. Macadam was drawn to the passage from the judgment of Cotton LJ in the Birmingham Case quoted in the previous paragraph. About it Jenkins LJ said at page 752:-

"The learned Lord Justice, I think, meant no more than this, that it was knowledge common to both parties that the existing low building was going to be replaced by a higher one and, that being so, the fortuitous access of extra light to the lessee's building while the scheme was being carried to completion could not be regarded as an enjoyment of light which would pass to the lessee a right to have it continued in the same degree."

39. In the Selby Case the facts were that the defendant purchased from the claimant a site laid out as a public car park. Almost all of the site was surrounded by property owned by the defendant. The claimant had an option to repurchase the site in certain events, which happened. The question at issue was whether, as an incident of the exercise of the right of repurchase, the claimant acquired rights over the surrounding land of the defendant. The Court of Appeal answered that question in the negative, holding that the intention of the parties was obviously, in the event of a repurchase, that the parties should simply be restored to the position in which they had been before the purchase of the site by the defendant in the first place. In the course of his judgment, at page 474, Peter Gibson LJ said:-

"The rule in Wheeldon v. Burrows only operates to the extent that it is not inconsistent with the intention of the parties which may be inferred from the circumstances. Similarly section 62 will not apply where the contrary intention is apparent from the conveyance or contract. Mr. Gaunt accepted that it is appropriate to look at the actual contract between the Council and Samuel Smith for this purpose even though the conveyance envisaged by condition 5(3) is a fiction. In applying the condition by reference to the general law, it is appropriate to take account of how the parties' intentions may affect the implication of rights."

The learned Lord Justice then referred to the passage from the judgment of Cotton LJ in the Birmingham Case which I have quoted.

40. I accept the submission of Mr. Caddick that in determining whether any, and if so, what rights pass under a transfer by virtue of the provisions of Law of Property Act 1925 s.62 it is necessary to have regard to the intentions of the parties as to what rights, if any, were to pass. However, that said, the burden must lie on the party asserting that it was not the intention of the parties to the particular transaction that the provisions of Law of Property Act 1925 s.62 should have the effect which they would otherwise have to make good that assertion. Whether the defendants in the present case have discharged that burden is the question to which I now turn.

The intentions of the parties to the Hotel Sale Agreement and subsequent transfer

41. Mr. Caddick submitted that the intention of the parties that no rights of mooring on the River Moorings or to place or to maintain signs on Noosa Sound were to pass on the transfer of the Hotel was to be collected in particular from the Letter, but also from the terms of the negotiations between the parties and from the fact that the Option Agreement had been made at the same time as the Hotel Sale Agreement. So far as the latter point was concerned, what Mr. Caddick submitted was that the making of the Option Agreement was in substance unnecessary unless it was thought that it was necessary for the Company to purchase Noosa Sound in order to obtain rights to use the River Moorings and to place and to maintain advertising signs on Noosa Sound. He also called attention to the specific reference to "moorings" in the description of the property the subject of the Option Agreement.
42. It is, it seems to me, important to consider the matters upon which Mr. Caddick sought to rely in their context. I shall therefore proceed chronologically through the negotiations between the parties and come to the Letter at the appropriate place in the chronology.
43. If one starts with the Particulars, it is, I think, plain that what was being offered for sale was not simply a piece of land upon which a building used as an hotel happened to stand, but a business conducted from that building, together with the assets and goodwill of that business, which in the year ended 31 March 2001 had generated a net turnover of £376,299. On any objective consideration it seems to me that the assets of the business included advertising signs placed on Noosa Sound, and the availability of moorings for use by patrons, which moorings were considered by Mr. Robin Crouch to have generated something slightly under 3% of the advertised turnover.
44. In his oral evidence Mr. Robin Crouch told me that at an early point in the negotiations with Mr. Platt he told Mr. Platt, who was then somewhat equivocal as to whether he wished to purchase Noosa Sound, that if he did not he would suffer a reduction in the turnover which the business carried on at the Hotel had previously generated. That evidence first surfaced in cross-examination. It had not been foreshadowed in Mr. Crouch's witness statement to which I have referred, and it had not been a matter which had been put to Mr. Platt when he gave evidence. I regret to have to say that I am satisfied that this evidence was fabricated by Mr. Crouch in order to support the defendants' case in the light of his perception of how that case seemed to be faring at the time he came to give his evidence. I reject any suggestion that there ever was any such conversation.
45. With the exception of the evidence of Mr. Robin Crouch to which I have referred in the previous paragraph, there did not seem to be much dispute as to the facts as to the dealings between the parties leading up to the completion of the transfer of the Hotel. Both Mr. Platt and Mr. Robin Crouch were asked during their oral evidence to say what had been in their respective contemplations during the negotiations concerning what the position would be about the use of the River Moorings and the placing and maintaining of notices on Noosa Sound in the event that the option to purchase Noosa Sound was not exercised by the Company. Unhappily the evidence of each on this issue was, in my judgment, coloured by the realisation of the significance, or possible significance, of the answers. I find that each gave self-serving answers and that I cannot rely upon anything either said as to what was in his contemplation during negotiations. The fact of the matter, I am satisfied, is that neither considered the possibility that the option to purchase Noosa Sound would not be exercised. The structure of the overall transaction as an outright sale of the Hotel and an option to purchase Noosa Sound was simply to facilitate the funding by the Company of the purchase of both. In my judgment the true position is revealed by this passage from the witness statement of Mr. Robin Crouch concerning the leaving in place of the signs on Noosa Sound after completion of the sale of the Hotel:-

"18. These remained in place during the option period as we expected the option to be exercised by the Claimants. There would have been little point in removing them when they were likely to be put back once the option was exercised."

Mr. Robin Crouch also told me in his oral evidence that he gave no instructions to anyone after the completion of the sale of the Hotel that the use of the River Moorings by patrons of the Hotel was to be curtailed.

46. In the light of the findings which I have indicated concerning the evidence of Mr. Robin Crouch and Mr. Platt as to what was in their respective minds during the course of negotiations, it seems to me that the only reliable evidence as to the course of negotiations is the notes and correspondence of Mr. Bartrop and communications between the solicitors acting for the parties, including the Letter.
47. I have already taken Mr. Bartrop's involvement up to the time Mr. Platt made his first offer on 23 May 2001. Mr. Bartrop's file notes record that as of 31 May 2001 Mr. Platt

"does not want riverside cottage but might split moorings"

Mr. Caddick relied heavily upon that note as indicating that Mr. Platt knew that if he wanted the use of the River Moorings he would have to purchase Noosa Sound. I am afraid that I can derive little from the note. The reference to a "split" of the moorings suggests that Mr. Platt was expressing tentative interest in the River Moorings rather than the Lagoon Moorings, or vice versa. It is not an obvious way to describe that to which Mr. Caddick submitted it referred.

48. In a letter dated 4 June 2001 to Messrs. Colin Palmer & Co. Mr. Bartrop recorded that Mr. Platt had agreed, subject to contract to purchase for the sum of £700,000 the Hotel including:-

"the freehold property, goodwill and all trade furniture, furnishings, fixtures, fittings and equipment, an inventory of which will be required for attachment to the contract shortly before exchange."

The letter contained no specific reference to moorings or advertising signs. In a letter dated 6 June 2001 to Messrs. Lionel J. Lewis & Co. Messrs. Colin Palmer & Co. recorded the fact of its instructions on behalf of the vendor, whom it described as Mr. Robin Crouch, and brief details of the sale agreed subject to contract. Again there was no specific mention of moorings or advertising signs.

49. In a file note dated 18 June 2001 Mr. Bartrop recorded a telephone conversation with Mr. Platt while Mr. Platt was with his bank manager. The material part of the note, so far as I can decipher it, read as follows:-

"Problems did not like the set up with house in grounds [illegible] with hotel. Thinks waterfront property is a tremendous asset to the hotel wants Platt to buy all three properties. Platt spoke to Crouch told him all this."

The note did not reveal why the bank manager thought that Noosa Sound was a tremendous asset to the Hotel, or why he apparently considered that Mr. Platt should also purchase Robin's Nest. A later note made by Mr. Bartrop dated the same day referred to "2 valuable moorings to be retained". While the reference is obscure, it would seem to be to the Lagoon Moorings, simply because there were in effect two of them rather than the effective three River Moorings. What seems to have being contemplated was thus a split of the moorings, such as seems to have been referred to in Mr. Bartrop's note of 31 May 2001 upon which Mr. Caddick placed so much reliance. Further notes of Mr. Bartrop dated 18 June 2001 indicate that it was then that the possibility of an option to purchase Noosa Sound, rather than an immediate outright purchase was first raised. The reason for that, Mr. Platt told me, and I accept, was to do with his funding arrangements. He and his wife owned an hotel in the Netherlands which they were intending to sell but not yet sold and that affected the practicalities of purchasing all of the properties at once.

50. Mr. Platt sent to Mr. Bartrop an e-mail dated 20 June 2001 upon which Mr. Caddick placed some reliance. The terms of the e-mail were:-

"Re: Petersfield House Hotel

In connection with the above, I have spoken with Mr. Crouch at some length and we seem to have come to some sort of informal agreement, which is as follows:

700,000 for the hotel. 200,000.00 for the four bedroomed house. An option of 225,000.00 for the key heading site and bungalow until 1^st May 2002. Until that time Mr. Crouch will utilise a small parcel of land adjacent to the drive-way for use of parking for clients of the key heading site. The use of this parcel of land will cease on the 1^st May 2002 in the event that we proceed or not.

We await Mr. Crouch's acceptance of this offer."

It was the use of the description "key heading site" apparently to refer to Noosa Sound upon which Mr. Caddick particularly relied. What that description actually means, or was intended to mean, was not explored in evidence. Reference to The New Shorter Oxford English Dictionary, 1993 edition, offers limited assistance. The closest possibly relevant definition of the word key, in the sense of a variant of cay or quay, is

"A low island, sandbank or reef, such as one of those common in the W. Indies or off the coast of Florida."

51. In a letter dated 22 June 2001 to Mr. Bartrop Mr. Robin Crouch himself set out his version of what had been agreed subject to contract with Mr. Platt. He used the expression "key headed site and bungalow" apparently to refer to Noosa Sound. The meaning, or intended meaning of the expression "key headed site" was not explored in evidence, nor was the significance, if any, of the difference between the expression "key heading site" used by Mr. Platt and the expression "key headed site" used by Mr. Crouch. Mr. Crouch's expression might be considered to be simply a description of the appearance of Noosa Sound in plan view.
52. In a letter dated 5 July 2001 to Messrs. Lionel J. Lewis & Co. Messrs. Colin Palmer & Co. set out its understanding of how matters stood in relation to what had been agreed subject to contract at that stage. That letter included the following:-

"3. Your Clients to have the option the purchase "Noosa Sound" Boathouse/Bungalow as part of the existing riverside plot until 31^st March 2002 at market value.

4. Our Clients to retain a small parcel of land to the left of the Hotel driveway entrance to be used for car parking in connection with the remainder of the mooring site to be retained by our Clients."

Mr. Caddick submitted that it was plain that in that letter the expression "mooring site" was being used to describe Noosa Sound, and from that it could and should be deduced that the parties understood and intended that Mr. and Mrs. Platt should have no right to use the River Moorings unless they purchased Noosa Sound. With great respect to Mr. Caddick it does not seem to me that, read as a whole, the passage which I have quoted means what he submitted at all. What seems at this stage to be being contemplated was a division of Noosa Sound such that Mr. and Mrs. Platt would have the option to purchase the Bungalow and a boathouse at Noosa Sound as part of a riverside plot, whilst Mr. and Mrs. Philip Crouch would retain the Lagoon Moorings.

53. Mr. Platt was cross-examined at some length about a file note made by Mr. Bartrop dated 11 July 2001, which was, so far as is presently material, in these terms:-

"Valuations Mr. Platt has spoken to Bidwells. House and hotel have valued up at agreed price however waterfront only @ £180k not £225k Platt's bank sees the waterfront as an integral part of purchase for a Broadlands Hotel corp. events etc. "

The suggestion which was put to Mr. Platt was that his financiers were anxious that the business to be conducted at the Hotel should have the right to use the River Moorings and that everyone understood that in order to gain that right it would be necessary to purchase Noosa Sound. Mr. Platt did not accept that. The reference in Mr. Bartrop's note to the bank seeing the waterfront as an integral part of the purchase in the context of corporate events seems to me to be wholly equivocal. It could simply mean that the bank thought that it would be an attraction to corporate clients if functions could be held beside the river. As I have already indicated, the website prepared for the Hotel business drew attention to the River Moorings being a lovely place to spend time watching boats go by, feeding the ducks and watching wildlife.

54. In the context of seeking finance for their intended purchase Mr. and Mrs. Platt prepared a business plan. A copy of that plan was put in evidence. It included this reference:-

"it is our intention to purchase within the year the land which is for sale which offers views directly to the broads with mooring facilities and would be a great asset to the hotel."

Mr. Caddick relied on that reference as indicating that Mr. and Mrs. Platt understood perfectly well that in order to have the use of the River Moorings they would have to purchase Noosa Sound. However, again it seems to me that the reference is equivocal. The first attraction identified of purchasing Noosa Sound is not moorings but a river view. That tends to support the suggestion in the preceding paragraph as to what might be perceived as attractive to corporate clients. The reference to "mooring facilities" is descriptive of the amenities possessed by Noosa Sound, but is unspecific as to which mooring facilities were intended. On no view would Mr. and Mrs. Platt have any right to use the valuable Lagoon Moorings unless they purchased Noosa Sound. Mr. Platt told me, and I accept, that he had in mind to keep boats on the Lagoon Moorings which could be available for hire by guests of the Hotel. I can well understand that that might be an attractive and worthwhile amenity.

55. In a letter dated 16 July 2001 to Messrs. Colin Palmer & Co. Mr. J.R. Sheppard of Barry wrote, so far as is presently material:-

"Further to our letter of 4^th June and subsequent discussion, it has been agreed that Mr. Platt will in addition acquire Robin's Nest and The Moorings for a consideration of £200,000 each, making a total consideration for the hotel and residential properties of £1.1 million."

Mr. Caddick relied upon the description of Noosa Sound in that letter as "The Moorings". That reference seems to me to be of little or no value to the defendants' case. First, the letter was not written by, addressed to, or copied, so far as the evidence goes, to Mr. Platt or any representative of his. Second, the use of capitals in the expression "The Moorings" suggests that the writer of the letter, who was not Mr. Bartrop, who had ordinary conduct of the relevant sale negotiations on behalf of Barry, thought that the name of the property in fact called Noosa Sound was actually "The Moorings". Third, the property called "The Moorings" is described in the very same sentence as one of the "residential properties". When in a letter dated 17 July 2001 to Messrs. Lionel J. Lewis & Co. Messrs. Colin Palmer & Co. sought to set out the terms the subject of Mr. Sheppard's letter it referred in the heading of the letter to Noosa Sound as "Riverside Bungalow/Boathouse" and in the body of the letter called the property by its name. In the letter Messrs. Colin Palmer & Co. recorded that on an outright sale of Noosa Sound " Our Clients will not retain any interest therein or require any rights to be reserved or car parking to be retained." That was presumably included to make clear that, unlike in an earlier version of the transaction, it was not intended to retain the Lagoon Moorings. In its reply dated 25 July 2001 Messrs. Lionel J. Lewis & Co. used a similar heading to that used by Messrs. Colin Palmer & Co. in its letter dated 17 July 2001.

56. Mr. Bartrop wrote a letter dated 2 August 2001 to Mr. Platt in which he confirmed the transaction between the parties as it then stood. The material part of the letter said this:-

"As requested I now have the authority of the vendors to confirm that the deal for these three properties is as follows:

Immediate purchase of the hotel, freehold and complete with fixtures and fittings (as per inventory) and goodwill at £700,000

Purchase of Mr. Robin Crouch's adjacent house, Robin's Nest, freehold at £200,000

An option to run until 31^st March 2002 to purchase the riverside bungalow adjacent to the hotel, along with the key holdings (moorings), which are also owned by Messrs. R & P Crouch. The purchase price agreed at £200,000 upon exercising this option.

The only other point that needs to be mentioned is one already agreed in that if you do not purchase the riverside bungalow and moorings, then Messrs. R & P Crouch wish to retain the small plot of land alongside the road by the entrance to the hotel as a car parking space for the bungalow."

That letter seems to add to the confusion arising from the references earlier in time in the correspondence copied before me to "key heading site" and "key headed site" by adding a new expression "key holdings" which Mr. Bartrop evidently considered needed clarification as meaning "moorings". In the light of earlier versions of the transaction, and the clarification given in Messrs. Colin Palmer & Co.'s letter dated 17 July 2001 that Mr. and Mrs. Crouch would not intend to retain any interest in Noosa Sound if that property were sold, the references in Mr. Bartrop's letter to the sale of "the riverside cottage" including the "moorings" seem intended to reaffirm that position, or to be purely descriptive. Certainly I see no justification for interpreting the letter as an unequivocal statement on behalf of Mr. and Mrs. Philip Crouch that it was not intended that any rights to use the River Moorings should pass unless Mr. and Mrs. Platt purchased Noosa Sound.

57. The next document to which I need refer is the Letter. This was really the sheet anchor of Mr. Caddick's submission. The relevant passage in the Letter which Mr. Caddick contended clearly resolved the issue of the intention of the parties in favour of the defendants was this:-

"3. Option Agreement in respect of "Noosa Sound" which is to run to the 28^th February 2002 (six months assuming completion 1^st September 2001). After the Hotel sale and during the Option Period the current arrangement for Hotel guests to occasionally pass over "Noosa Sound" will discontinue, although our Clients may give consent from time to time strictly at their absolute discretion. Both "Noosa Sound" and the moorings are let at present but full vacant possession will be available on completion, unless your Clients wish to make their own arrangements with those concerned."

In my judgment Mr. Caddick has sought to build upon this passage an edifice which it simply will not support. The only reference in terms to "moorings" was to moorings which were let, but of which vacant possession would be given on completion if the option to purchase Noosa Sound were exercised. Against the background which I have set out, the "moorings" to which reference was made could only have been the Lagoon Moorings. Thus the Letter contained no express reference to the River Moorings. The arrangement which the Letter said would discontinue was not in terms any use of moorings but one "for Hotel guests to occasionally pass over "Noosa Sound"". What arrangement was being referred to is obscure. There was no direct evidence that guests of the Hotel were permitted to take walks beside the river, although the comment on the website as to the attractions of spending time at the River Moorings suggests that they were. Moreover, Mr. Robin Crouch's evidence was that only the Bungalow and not the grounds of Noosa Sound were let to Mr. O'Brien. It is therefore more than possible that Hotel guests were on occasion permitted to walk alongside the river in the grounds of Noosa Sound. Whether that be so or not, the language used is in my judgment far too imprecise to make clear what Mr. Caddick submitted it made clear, namely that any right to use the River Moorings was discontinued.

58. I come then to the fact of the making of the Option Agreement and its terms, which so far as material I have already set out. There were obviously potentially good reasons for the Company acquiring Noosa Sound whether or not it had rights to use the River Moorings. Unless it acquired Noosa Sound it would not be able to use the Lagoon Moorings or the grounds of the Bungalow as an amenity for guests. It just is not the case that there was no reason to want to acquire Noosa Sound unless it was to be able to use the River Moorings. The description of the property to which the option related as "including the moorings" was probably, it seems to me, a reflection of the earlier negotiations which at one point seemed to contemplate that Mr. and Mrs. Philip Crouch might retain the Lagoon Moorings even if the rest of Noosa Sound were sold. Certainly in the context the reference to "moorings" must have been to all the moorings at Noosa Sound, and not simply to the River Moorings, so the reference does not appear to lend any support to Mr. Caddick's submission.

Rectification

59. By the end of the trial the question of rectification had virtually disappeared as an issue. It arose at all because of a decision of Luxmoore J, Clark v. Barnes [1929] Ch 368. In short in that case Luxmoore J found that the effect of Law of Property Act 1925 s.62 was to pass under a conveyance as reputed to be enjoyed with a particular piece of land a right of way which the parties to the conveyance intended should not pass. Because of the intention of the parties which he found, Luxmoore J as it were undid the effect which he found was produced by Law of Property Act 1925 s.62 by rectifying the conveyance to exclude the passing of the right of way. Mr. Caddick really conceded, as it seems to me correctly, that it was difficult to reconcile the decision of Luxmoore J with the significance to the operation of what is now Law of Property Act 1925 s.62 of the parties' intentions identified in the Birmingham Case and the Selby Case. It is a different approach to the same problem, but in my judgment it is logically more satisfactory to consider the intention of the parties at the point of deciding whether Law of Property Act 1925 s.62 is to have any, and if so what, effect, rather than let it have an effect which the parties did not intend and then seek to undo that effect. In any event, for the reasons which I have given, I am not satisfied that the Company and Mr. and Mrs. Philip Crouch shared the intention for which Mr. Caddick contended, so it is unnecessary for me to consider what would be the appropriate means in law of giving effect to that intention had it existed.

Conclusion

60. In the result I declare:-

i) that the right for residents or customers (or prospective residents or customers) of the Hotel, in common with the owner or occupier for the time being of the property known as and situate at Noosa Sound, to moor boats at the locations of the moorings marked A, B. and C on Plan B attached to the Particulars of Claim in this action passed to the Claimant by virtue of the transfer dated 14 September 2001;

ii) that the right to locate and display 3 mooring signs (naming the Hotel) at the locations of the moorings marked A, B and C on Plan B attached to the Particulars of Claim in this action passed to the Claimant by virtue of the transfer dated 14 September 2001;

iii) that the right to locate and display 2 large boards (naming and advertising the Hotel) at the locations shown marked D and E on Plan B attached to the Particulars of Claim in this action passed to the Claimant by virtue of the transfer dated 14 September 2001;

iv) that a right of way on foot for the residents or customers (or prospective residents or customers) of the Hotel between the moorings marked A, B and C on Plan B attached to the Particulars of Claim in this action along the path marked brown on the said plan to the public highway called Lower Street passed to the Claimant by virtue of the transfer dated 14 September 2001;

v) that the right to locate and display signs advising residents or customers (or prospective residents or customers) of the said pathway at the locations marked F and G on Plan B attached to the Particulars of Claim in this action passed to the Claimant by virtue of the transfer dated 14 September 2001

61. I will hear Counsel as to whether, in the light of the foregoing declarations, it is necessary or appropriate for me to grant any injunction.