Mutual Covenants
Cases
Fitzpatrick v Clancy
Unreported (High Court) (1964)
Kenny J.:
By a lease made on the 4th July 1835 the Earl of Howth let lands on the sea front at Sutton to a Mr. Pier for 100 years from the 1st May 1835 and a large house called Warren House was subsequently built on them. The tenant’s interest under this lease was acquired by a Mrs. Conner who made sub-leases of parts of the lands and then, in 1934, assigned the remaining parts of the lands containing about 10 acres to Mr. John Hanley. Mr. Hanley then began negotiations with the Howth Estate Company (which I shall call ‘the Company’) which had become entitled to the freehold interest in the lands for a reversionary lease of the lands assigned to him. Warren House was, at this time, in a bad state of repair and the Company wanted to impose an obligation to repair it on Mr. Hanley who could not decide whether he wanted to rebuild it as a residence for himself or whether he wanted to pull it down and develop the lands as a building estate. The lands had many attractive features: they are on the main road from Dublin to Sutton and there is a fine view from them over the sea to the Hill of Howth. On the 1st August 1934 Mr. Hanley stated to the agents acting for the Company that he wanted to occupy Warren House as it was and that he had no intention of building on the lands. After long negotiations Mr. Hanley on the 6th November 1934 made a written proposal to the Company: he offered to take a lease of the lands for 999 years from the 1st May 1935 at a rent of
£40 per year and undertook to expend money on Warren House to put it into
reasonable order within two years from the date of the proposed lease unless the house should, before then, have been pulled down ‘in furtherance of a building scheme’. The proposal also provided that Mr. Hanley was to be free to build dwellinghouses on the lands on sites and in accordance with plans to be approved by the Company but an additional rent of £3 per year was to become payable for each dwellinghouse.
The draft lease prepared by the solocitors for the Company contained a covenant by Mr. Hanley for himself and his assigns that he or any other person would not convert, use or occupy the premises let or any part thereof or any building or buildings to be erected on the lands for any purpose save as a private dwellinghouse or houses. The Solicitor acting for Mr. Hanley struck this covenant out of the draft lease and, in place of it, put in a covenant that the tenant would not use the premises for any offensive trade or business. The solicitors for the Company refused to accept this amendment and insisted on the original covenant in the draft. A lease of the 3rd May 1935 between the Representative Church Body (which were mortgagees of the Company), the Company and Mr. John Hanley was the result of these negotiations. By it the lands with the house and other buildings were let by the Representative Church Body at the request of the Company to Mr. Hanley for 999 years from the 1st May 1935 at a yearly rent of £40. There was a provision for a penal rent of £30 for each dwellinghouse built on the lands without the consent of the Company. Mr. Hanley for himself and his assigns covenanted amongst other things, that he would ‘within two years from the date hereof in the event of the dwelling-house now standing on the said demised premises not having been pre viously taken down in furtherance of a building scheme as hereinafter mentioned expend such a sum on the repair of the said dwellinghouse as will put the same in reasonable order and condition’ and that he ‘or any other person or persons will not at any time during the term hereby granted convert, use or occupy the said premises or any part thereof or any building or buildings to be erected thereon for any purpose save as a private dwellinghouse or houses’. It also contained a clause in these terms: ‘Provided always that the lessee shall have the option to build and erect on the said premises such dwellinghouses and buildings as may be agreed on by the Company (the Howth Estate Company) the said houses to be erected on a site the site plans and specifications to be first approved by the Company’ and Mr. Hanley was then to pay an additional yearly rent of £3 for each such house. There was also a covenant by the Company for quiet enjoyment.
Mr. Hanley, who was a buyer in a drapery firm in Dublin and who was not a builder, did not demolish Warren House within two years from the date of the lease and lived there until his death. The house was not demolished until 1961 when the first four-named defendants who are the trustees for the Irish Christian Brothers had it demolished.
Early in 1938 the plaintiff, Mr. Thomas Fitzpatrick, who wanted to build a house on part of the lands in the lease, began negotiations with Mr. Hanley to acquire part of the lands which fronted on to the main road to Howth. He retained Mr. Patrick Munden, the well-known architect, to examine the proposed site and to prepare a map. The plaintiff, who wished to build a good house, wanted a site on the west side of the lands and was therefore concerned about the type of house which Mr. Hanley might build on the remaining part of the 536 feet frontage. The plaintiff tried to get an assurance from Mr. Hanley about the kind of houses which might be built on the frontage, and on the 6th December 1938 the solicitors acting for Mr. Hanley wrote to the plaintiff in these terms:
‘Referring to your call here on the 29th ult. (the 29th November 1938) I communicated with my client with reference to the assurance required by you as to the type of house which my client intended to build on the remaining portion of the frontage at Sutton. Mrs. Hanley called here to-day and informed me that ML Hanley was prepared to give an undertaking that any house built on the plot would be value for at least £1,000. She also stated that it was Mr. Hanley’s wish to get the best possible house, but it would be useless going to the expense of preparing plans for houses for the frontage which might have to be altered later on. I think you may take it that Mr. Hanley is as anxious as you are to get a good class house built on his land.’
And on the 23rd February 1939 the plaintiff wrote a letter to Mr. Hanley which contained these paragraphs:
‘As a result of Mr. Munden’s visit to Sutton on Tuesday I have received from him a draft map showing the plot of ground, having a frontage of 120 feet, and being 120 feet wide at back, together with garden at rear of this plot.
It is clearly set out, and I am satisfied it will be suitable. I am agreeable to take it at the figure agreed upon viz. £750 subject to my solicitor’s approval.
It is understood and agreed between us, that if when the plans are in preparation or completed, my architect considers that a further extension of 20 or 30 feet desirable that such an extension can be required at an agreed price. Also that only good type houses costing not less than £1,000 shall be erected on adjoining plots. I would require vacant possession of the lodge.
I intend to get plans prepared immediately, as I am anxious to get on with the work, and I would be glad to have your formal acceptance.’ On the 26th February Mr. Hanley wrote to the plaintiff:
‘Your communication received. Everything nominated is in order and accepted. Ground is now pegged and a personal visit is advisable.’
A development plan showing a possible layout of the lands with Warren House standing and the plaintiffs house with eight other houses on the frontage was prepared by Mr. Munden in March 1938 on Mr. Hanley’s instructions. The plaintiff had not seen this plan at any time before the assignment to him on the 6th July 1939 but he knew that Mr. Hanley with whom he was on friendly terms had consulted Mr. Munden about the development of the frontage. I think that Mr. Munden was acting as architect for the plaintiff and for Mr. Hanley in 1938 and in 1939.
While the plaintiff was negotiating with Mr. Hanley for a site, discussions between Mr. Hanley and a Mr. O’Baoighill for the sale of a plot of land fronting on to the main road but on the east side of the lands let by the lease of 1935 were going on. On the 31st March 1939 Mr. Hanley assigned to Mr. O’Baoighill a plot of land on the east side of the lands in the lease of 1935 for the residue of the term of 999 years subject to the payment of the rent of £40 and to the covenants in the lease of 1935 but indemnified against payment of this rent by the remaining lands in that lease. This assignment had a recital that Mr. O’Baoighill intended to build a house on the lands assigned to him, that he had got the consent of the Company to this and had agreed to pay a rent of £3 to them and he covenanted to pay it. The dimensions of the plot of land assigned to Mr. O’Baoighill did not correspond with those shown on Mr. Munden’s development plan for the same site.
On the 6th July 1939 Mr.,Hanley assigned to the plaintiff a plot on the western side of the lands let to him by the lease of 1935 for the residue of the term of 999 years subject to the rent of £40 but indemnified against it by the remaining lands in the lease and the plaintiff agreed to pay a rent of £3 to the Company. This assignment contained a recital of the assignment to Mr. O’Baoighill and of the intention of the plaintiff to build a house on the lands assigned to him. Mr. Hanley covenanted with the plaintiff ‘that he will henceforth during the continuance of the said term of 999 years pay the said yearly rent of £40 reserved by and perform and observe the covenants on the part of the lessee and conditions contained in the said indenture of lease (the lease of 1935) so far as the same relate to such of the premises thereby demised as are retained by the vendor (Mr. Hanley) and will at all times keep the purchaser (the plaintiff) effectually indemnified against all actions and proceedings, costs, damages, expenses, claims and demands whatsoever by reason or on account of the non-payment of the said yearly rent of £40 or any part thereof or the breach non-performance or non-observance of the said covenants and conditions or any of them insofar as they relate to the premises retained by the
vendor (Mr. Hanley)’.
Neither of these assignments contained any covenant or stipulation by Mr.
Hanley about the user of the lands retained by hirn except his covenant to observe the covenants in the lease of 1935. This covenant by Mr. Hanley was a covenant of indemnity only and was not an assignment to the plaintiff or to Mr. O’Baoighill of the benefit or burden of the covenant relating to user in the lease of 1935 and did not impose any restriction on his use of the remaining lands in favour of the plaintiff or Mr. O’Baoighill (Beattie v. Quivey (1876) I.R- 10 C.L. 516 and Harris v. Boots Limited [1904) 2 Ch. 376). There was thus no covenant between Mr. Hanley and the plaintiff in connexion with the user of the lands retained by Mr. Hanley.
The plaintiff and Mr. O’Baoighill erected houses on the lands assigned to them. I have, with the consent of all the parties, inspected both of these houses from the outside and the foundations which have been dug for the school. The plaintiff’s house is a fine residence with long well-kept gardens in the front and back and hasa most attractive view from the front towards the Hill of Howth. I unhesitatingly accept the evidence given by Mr. Gill, a most experience valuer, that the proposed school will reduce the market value of the plaintiffs house by £6,000.
In September 1941 the plaintiff wished to buy some more ground at the back of his house and Mr. Hanley assigned to him another part of the lands in the lease of 1935 for £250 indemnified against the rent of £40 which Mr. Hanley charged on the lands retained by him. This assignment contained a similar covenant of indemnity by Mr. Hanley in relation to the payment of the rent of £40 and the performance
and observance of the covenants in the lease of 1935.
Mr. Hanley died on the 16th December 1942 and left all his property to his wife, who on the 31st March 1947 assigned all the lands comprised in the lease of 1935 which had been retained by Mr. Hanley (and which then amounted to about6 acres) to Margaret Willis. On the 5th June 1953 the Company let a small piece of land on the north-eastern side of the lands included in the lease of 1935 to Mrs. Willis for 981 years. Mrs. Willis wanted to have the lands which had been assigned to her developed as a building estate and had plans for houses on all the lands and not on the frontage only passed by the Town Planning Authority. The plaintiff took keen interest in this proposal and wrote to the Town Planning Authority to emphasise the importance to him of good houses being built on the lands near his
house so that its value would be maintained.
Mrs. Willis despaired of the lands. being developed and on the 24th November
1959 she agreed to sell (by way of assignment) the lands which had been transferred to her in 1947 and with the benefit of the covenants contained in the assignment to the plaintiff and to Mr. O’Baoighill. The Christian Brothers purchased the lands for the building of a large primary school and, at a later date, of a secondary school. As this user would have been a breach of the covenant in the lease of 1935 to use the lands for private dwellinghouses, the solicitors acting for the Irish Christian Brothers wrote to the Company to find out if this covenant could be altered so that a school could be built on the lands and sorne inconclusive and diplomatically obscure letters were written by the solicitors acting for the Company.
On the 4th January 1960 Mrs. Willis assigned the lands which had been retained
by Mr. Hanley to the first four-named defendants for the residue of the term of years granted by the lease of 1935 subjeca to the rent of £40 and to the covenants in the lease of 1935. This assignment contained a covenant by the first four-named defendants to observe and perform the covenants in the lease of 1935 and to indemnify Mrs. Willis against actions and proceedings by reason or on account of the non-payment of the rent of £40 or the breach non-performance or non observance of the covenant in the lease of 1935. The Christian Brothers then demolished Warren House and carried out other works on the lands although this was a breach of the covenants in the lease of 1935. The Company threatened to bring proceedings against them but the estate agents acting for the Company advised their clients that the Christian Brothers had rights under the Landlord and Tenant Acts and that they might be able to get permission to build the schools. This advice was plainly wrong for the lands were not ‘a tenement’ within the meaning of that term as defined in the Landlord and Tenant Act 1931 (see Corr v. Ivers [1949] LR. 245 and McEvoy v. Gilbeys of Ireland Limited [1964] LR. 30). Ultimately the Company agreed to alter the covenant in the lease about the use of the lands for private dwellings so that buildings for use as a school or college (other than a reformatory or industrial school) might be built on the lands and, for this conces sion, the rent of £40 payable under the lease of 1935 was increased to £164. This agreement took legal shape in a deed dated the 19th May 1961 (expressed to be supplemental to the lease of 1935) by which the Company authorised the first four-named defendants to demolish the dwellinghouses on the lands and to erect additional buildings (provided that the new buildings did not interfere with the
amenities of the existing leaseholds) and to use the new buildings for a school or college.
Plans for the new primary school on the lands have been approved by the Company and by the town planning authority. The primary school is designed to take about 500/600 boys and will be 50 feet from the boundary wall of the plaintiff’s premises and a new secondary school may be built at a later date. The primary school (the foundations for which have been opened) is sited so that its front line will be 60 feet beyond the front line of the plaintiffs house and it will seriously interfere with the very attractive view from the windows of the plaintiffs house. Preliminary work on the site for the school began in 1964. The plaintiffs began these proceedings on the 23rd October 1964 and then applied for an interlocutory injunction: on the hearing of this application the first four-named defendants gave an undertaking that they would not proceed with the work until this action had been determined in the High Court. The action was heard in January 1965: many documents were discovered and I have been given a book of all the correspond ence. All counsel and solicitors in the case are to be commended for having had the case disposed of so rapidly.
The plaintiff claims an injunction to restrain the Christian Brothers from erecting a school on the lands adjoining his house and an injunction to restrain the Company from authorising this. The Representative Church Body made the lease of 1935 as mortgagees of the Company, and their mortgage was paid off in 1945. The second named plaintiff who is the assignee of Mr. O’Baoighill has served notice of discon tinuance of the action.
The plaintiffs case against the Christian Brothers is that the lease of 1935 created ‘a building scheme’ so that he is entitled to enforce the covenant by the tenant in the lease of 1935 against them as assignees of part of the lands in that lease. The plaintiffs case against the Company is that the grant of the supplemental deed of
the 19th May 1961 was a derogation from the grant by the Company of the lease of ,
1935. In the course of a very able closing speech Mr. Parke made the additional case that what Mr. Hanley did, said and wrote in 1938 and 1939 created ‘a building scheme’ so that the covenants by the tenant in the lease of 1935 could be enforced by one assignee against another although there was no covenant by Mr. Hanley binding him and his assigns to use the lands retained by him in any way. I wish to emphasise that the only covenants involved are those contained in the lease of 1935: there are no other covenants. It has not been argued that the letters between the plaintiff and Mr. Hanley created a contract or collateral bargain which can be enforced against the Christian Brothers. Legal principles and decided cases of high authority establish that such a case based on a contract or collateral bargain could not succeed against them.
Most of the reported cases dealing with the Chancery doctrine of the ‘building scheme’ are English and relate to cases where the lands were conveyed in fee in lots with restrictive covenants as to user in each conveyance. In this case section 13 of the Landlord and Tenant Act 1860 gives the plaintiff as assignee of the original tenant in the lease of 1935 the same right to enforce the covenants by the landlord in that lease as Mr. Hanley had but the covenants in the lease of 1935 on which reliance is placed in this action was not by the landlord with Mr. Hanley but were by Mr. Hanley with the Company.
The legal doctrine by which a purchaser or lessee of lands who has purchased them subject to restrictive covenants as to user may enforce similar restrictive covenants entered into by adjoining purchasers or lessees with the person from whom they purchased or leased the lands was developed by the Courts of Chancery in the second half of the 19th century and was a means by which relief could be given in cases where the common law could not do so. The difficulty about giving relief under the common law was that the restrictive covenants which the plaintiff sought to enforce had not been made by the adjoining owner with the plaintiff but had been entered into by the person against whom it was sought to enforce them with the grantor or lessor. There was thus no privity of contract between the plaintiff seeking to enforce the covenants and the person against whom their enforcement was sought.
The first statement of this doctrine is to be found in the judgment of Hall, V.C. (a great authority on the law of property and conveyancing) in Renals v. Cowlishaw (1878) 9 Ch. D. 125, a judgment which was affirmed by the English Court of Appeal (see ll Ch. D. 866). The Vice Chancellor said (p. 128): ‘The law as to the burden of and the persons entitled to the benefit of covenants in conveyances in fee was certainly not in a satisfactory state; but it is now well settled that the burden of a covenant entered into by a grantee in fee for himself his heirs and assigns although not running with the land at law so as to give a legal remedy against the owner thereof for the time being, is binding upon the owner of it for the time being, in equity, having notice thereof. Who then (other than the original covenantee), is entitled to the benefit of the covenant? From the cases of Mann v. Stephens (15 Sim 377), Weston v. Macdermott (L.R. 2 Ch. 72) and Coles v. Sims (5 De G.M. and G.1) it may, I think, be considered as determined that anyone who has acquired land, being one of several lots laid out for sale as building plots, where the Court is satisfied that it was the intention that each one of the several purchasers should be bound by and should, as against the others, have the benefit of the covenants entered into by each of the purchasers, is entitled to the benefit of the covenant; and that this right, that is, the benefit of the covenant, enures to the assign of the first purchaser, in other words, runs with the land of such purchaser. This right exists not only where the several parties execute a mutual deed of covenant, but wherever a mutual contract can be sufficiently established. A purchaser may also be entitled to the benefit of a restrictive covenant entered into with his vendor by another or others where his vendor has contracted with him that he shall be the assign of it, that is, have the benefit of the covenant. And such covenant need not be express, but may be collected from the transaction of sale and purchase. In considering this, the expressed or otherwise apparent purpose or object of the covenant, in reference to its being intended to be annexed to other property, or to its being only obtained to enable the covenantee more advantageously to deal with his property, is important to be attended to. Whether the purchaser is the pur chaser of all the land retained by his vendor when the covenant was entered into, is also important. If he is not, it may be important to take into consideration whether his vendor has sold off part of the land so retained, and if he has done so, whether or not he has so sold subject to a similar covenant: whether the purchaser claiming the benefit of the covenant has entered into a similar covenant may not be so important.’ In the Court of Appeal Lord Justice James (another great authority on Chancery matters) said that he entirely concurred with every word of the judgment of the Vice Chancellor.
The next case (Spicer v. Martin (1888) 14 App. Cas. 12) is one of great authority for not merely is it a decision of the House of Lords but is a decision of that House sitting with a majority of Irish Lords of Appeal in Ordinary (Lords Fitzgerald and Macnaghten). In that case Spicer purchased from the Commissioners of the exhibi tion of 1851 the fee simple interest in a house No. 2 Cromwell Gardens subject to a covenant that he would not permit any trade or business to be carried on there. The conveyance to him in 1867 included a block plan of the seven houses in Cromwell Gardens. By six similar conveyances made on the same day the Commissioners conveyed the six other houses in Cromwell Gardens to Spicer: all the seven houses formed one block of buildings and each conveyance contained a similar restrictive covenant. In 1880 Spicer made a lease of No. 2 Cromwell Gardens to Martin subject to a covenant that the premises would be used as a private dwellinghouse only: this lease, which included a block plan of the seven houses, was for 80 years and was granted for a high premium. In 1885 the promotor of a hotel company arranged for the purchase of five of the houses in Cromwell Gardens with the intention of converting them into a hotel and he negotiated with the Commissioners for a release of the restrictive covenants. At this time some of the houses in Cromwell Gardens were owned by Spicer’s devisee who gave his consent to the negotiations with the Commissioners. Martin then sued Spicer’s devisee and the promoters to restrain the use of the five houses as a hotel. There was no covenant by Spicer with Martin that the houses in Cromwell Gardens (other than No. 2) would be used as private dwellinghouses but, despite this, Martin was granted a perpetual injunction. In the course of his speech Lord Fitzgerald said: ‘It seems to me that these two transactions run into each other and are not to be separated, and that each was subject to and brought about by the same statement that the whole of this property of the seven dwellinghouses was on the part of both the landlord and his lessees subject to the same restriction, that the houses were to be used as private dwellinghouses only, and for no other purpose, and that the purchaser, Martin, was to be subject to and to haye the benefit and protection of that restriction’.
….’There is every ingredient in this case from which we may reasonably infer an intention that the lessees or purchasers were to be protected by and have the benefit of the restrictive covenant as between Spicer and the Commissioners and to be bound by a similar obligation entered into by each on his own behalf.
It can make no difference that Spicer’s obligation to the Commissioners was split up by the adoption of a separate conveyance in fee of each of the seven building lots’.
‘I cannot entertain any reasonable doubt that as between the appellant and the respondent the latter was, according to right and justice, entitled to the full benefit and protection of the restrictive covenant which the vendor had entered into with the Commissioners.’
In the course of his speech Lord Macnaghten said: ‘If the site of the houses now
known as Cromwell Gardens had been put up for sale by auction in building lots, according to a plan corresponding with that on Mr. Martin’s lease, and if the conditions of sale had prescribed that houses should be built such as those which have actually been erected, and that every purchaser should bind himself by a covenant now in question, no one, I think, could have doubted that each purchaser would, as against the vendor, and as against every co-purchaser, have the right to the benefit of the covenent, although there might have been no direct stipulation to that effect, and no express provision for mutual covenants by the purchasers inter se. What difference is there in substance between the case I have supposed and the case which has occurred? The site was laid out in accordance with the building scheme, the houses were to be built as private houses, and to be used for no other purpose: a covenant to that effect was imposed on the builder who bought the ground, and intended to parcel it out and sell it or let it again. The houses were actually built as private houses, and offered to the public as such. Their character was unmistakable; and every person who took one of the houses was required to enter into the same restrictive covenant. All this in one way or another was brought to Mr. Martin’s knowledge. Every lessee in ordinary course must have had the same information as Mr. Martin had. Every lessee must have known that every other lessee was bound to use his house as a private residence only. This restriction was obviously for the benefit of all the lessees on the estate; they all had a common interest in maintaining the restriction. This community of interest necessarily, I think, requires and imports reciprocity of obligation.’
Graham v. Craig [1902] 1 LR. 263, a decision of the Court of Appeal in Ireland
reversing a judgment of Porter M.R. is the only Irish case on the matter. The issue in that case was whether there was a building scheme: the Court of Appeal held that there was no evidence from which it could be inferred that such a scheme was ever in existence.
In Elliston v. Reacher [1908] 2 Ch. 374, Mr. Justice Parker (as he then was) stated the law about the enforcement of restrictive covenants in a building scheme in a
manner which has been approved in many subsequent cases. He said: ‘I pass, therefore, to the consideration of the question whether the plaintiff can enforce these restrictive covenants. In my judgment, in order to bring the principles of Renals v. Cowlishaw and Spicer v. Martin into operation it must be proved (1) that both the plaintiffs and the defendants derived title under a common vendor; (2) that previously to selling the lands to which the plaintiffs and the defendants are respectively entitled the vendor laid out his estate, or a defined portion thereof (including the lands purchased by the plaintiffs and defendants respectively), for sale in lots subject to restrictions intended to be imposed on all the lots, and which, though varying in details as to particular lots, are consistent and consistent only with some general scheme of development; (3) that these restrictions were intended by the common vendor to be and were for the benefit of all the lots intended to be sold, whether or not they were also intended to be and were for the benefit of other lands retained by the vendor; and (4) that both the plaintiffs and the defendants, or their predecessors in title, purchased their lots from the common vendor upon the footing that the restrictions subject to which the purchases were made were to enure for the benefit of the other lots included in the general scheme whether or not they were also to enure for the benefit of other lands retained by the vendors. If these four points be established, I think that the plaintiffs would in equity be entitled to enforce the restrictive covenants entered into by the defendants or theirpredecessors with the common vendor irrespective of the dates of the respective purchases. I may observe, with reference to the third point, that the vendor’s object in imposing the restriction must in general be gathered from all the circumstances of the case, including in particular the nature of the restrictions’. If a general observance of the restrictions is in fact calculated to enhance the values of the several lots offered for sale, it is an easy inference that the vendor intended the restrictions to be for the benefit of all the lots, even though he might retain other land the value of which might be similarly enhanced, for a vendor may naturally be expected to aim at obtaining the highest possible price for his land. Further, if the first three points be established, the fourth point may readily be inferred, provided the purchasers have notice of the facts involved in the first three points: but if the purchaser purchases in ignorance of any material part of those facts, it will be difficult, if not impossible, to establish the fourth point. It is also observable that the equity arising out of the establishment of the four points I have mentioned has been sometimes explained by the implication of mutual contracts between the various purchasers, and sometimes by the implication of a contract between each purchaser and the common vendor, that each purchaser is to have the benefit of all the covenants by the other purchasers, so that each purchase is in equity an assign of the benefit of these covenants. In my opinion the implication of mutual contract is not always a perfectly satisfactory explanation. It may be satisfactory that all the lots are sold by auction at the same time, but when, as in cases such as Spicer v. Martin, there is no sale by auction, but all the various sales are by private treaty and at various intervals of time, the circumstances may, at the date of one or more of the sales be such as to preclude the possibility of any actual contract. For example, a prior purchaser may be dead or incapable of contracting at the time of a subsequent purchase, and in any event it is unlikely that the prior and subsequent purchasers are ever brought into personal relationship, and yet the equity may exist between them. It is, I think, enough to say, using Lord Macnaghten’s words in Spicer v. Martin, that where the four points I have mentioned are established, the community of interest imports in equity the reciprocity of obligation which is in fact contemplated by each at the time of his own purchase.’ The judgment of Mr. Justice Parker was affirmed by the English Court of Appeal (see [1908] 2 Ch. 665). I have read a number of other cases, Reid v. Bickerstaff [1909] 2 Ch. 305, a decision of the English Court of Appeal, Kelly v Barrett [1924] 2 Ch. 279, a decision of the same Court and Newton Abbot Co-Operative Society v. Williamson [1952] 1 All E.R. 279, a decision of Mr. Justice Upjohn (as he then wa) but these
decisions do not add anything to the principles laid down by the earlier cases.
When these principles are applied to this case, the first of the arguments put forward for the plaintiff, that the lease of 1935 created a building scheme because it contained a covenant to use the premises for the purpose of dwellinghouses, is seen to be incorrect. For this argument the Company must be regarded as the vendor but there is no evidence whatever that the Company had ever laid out the lands in the lease of 1935 er any defined portion of them for sale in lots and all the evidence indicates that they did not ever intend to do so. The only restriction on the lands related to their use and there is no evidence that Mr. Hanley ever took the lease with the intention that any restrictions contained in it which he might subsequently impose on the purchaser or sub-lessee from him were to be for the benefit of any other lots which might be included in the scheme. Indeed, the amendment to the draft lease made by Mr. Hanley’s solicitor shows that Mr. Hanley wanted to have liberty to use the lands for purposes other than those of private dwellinghouses. This branch of the case also fails because it is impossible to infer the existence of a building scheme from one lease only.
The next argument was that Mr. Hanley was to be treated as the common vendor. There is evidence that he had had a plan of development of the frontage of the lands prepared in March 1938 but the plaintiff had not seen this nor did he rely on it when he made his purchase. There is, moreover, complete uncertainty about the extent of this scheme of development. Was it to relate to the front only or was it to relate to all the lands assigned to Mr. Hanley? The two assignments made to Mr. Fitzpatrick and Mr. O’Baoighill do not contain any restrictions except those arising from the covenants to observe the conditions and covenants in the lease of 1935. There is no evidence that Mr. Hanley intended to incorporate the restrictions on the user contained in the lease of 1935 in sub-leases or assignments to be made by him so that such incorporation would be for the benefit of all the lots intended to be sold. The covenant as to user contained in the lease of 1935 would of course be enforceable by the Company against any assignee or sub-lessee from Mr. Hanley but it does not seem to me that this creates ‘a building scheme’.
In my opinion there was never a building scheme in connexion with these lands in
existence.
The plaintiff has also made a claim against the Company because, it was said,
they had derogated from their grant by releasing the covenant about user in the lease of 1935. The principle relied on is that an owner cannot sell or let lands for a particular purpose and then, subsequently, do or permit an act which frustrates or materially interferes with the known purpose for which the letting was made. The most authoritative statement of the law on this matter is that in the opinion of Lord Loreburn L.C. when giving the advice of the Privy Council in Lyttelton Times Company Limited v. Warners Limited [1907] A.C. 476. The Lord Chancellor said: ‘At the root of the difficulties in the case as presented to their Lordships in argument lies this question. Ought the fact that one of the parties was the grantor and the other the grantee of a lease to dominate the decision of the case? The maxim that a grantor cannot derogate from his grant expresses the duty ordinarily laid on a man who sells or leases land. But it does not touch a similar and equally binding duty that may in certain cases be laid on a man who buys or hires land. If A lets a plot to B, he may not act so as to frustrate the purpose for which in the contemplation of both parties the land was hired. Also if B takes a plot from A, he may not act so as to frustrate the purpose for which in the contemplation of both parties the adjoining plot remaining in A’s hands was destined. The fact that one lets and the other hires does not create any presumption in favour of either in construing an expressed contract. Nor ought it to create a presumption in constru ing the implied obligation arising out of a contract. When it is a question of what shall be implied from the contract, it is proper to ascertain what in fact was the purpose or what were the purposes to which both intended the land to be put, and having found that, both should be held to all that was implied in the common intention.’ The Lord Chancellor uses the phrase ‘so as to frustrate the purpose for which in the contemplation of both parties the land was hired’ but the later cases (Browne v. Flower [1911] 1 Ch. 226, O’Cedar Limited v. Slough Trading Company Limited [1927] 2 K.B. 123 and Kelly v. Battershell [1949] 2 E.R. 830) suggest that the correct test is whether what is done is a substantial interference with the common purpose for which the premises were let or which renders them materially less fit for that purpose. It was strenuously contended by counsel for the plaintiff that the decision in Kelly v. Battershell was incorrect and that I should not follow it but the validity of the principle on which the English Court of Appeal acted was not
disputed.
In my opinion a school beside the plaintiffs house, though it will substantially
reduce its market value, will not render it materially less fit for living in. It may interfere with the plaintiffs privacy and quiet but this is not sufficient to make the house less fit as a dwellinghouse.
It has also been suggested that the Company which had granted the lease of 1935 which contained a restriction as to user by the tenant could not subsequently release the covenant which created this restriction. No decided case or text-book of
authority was cited to support this wide proposition. As a general statement of the law, it is certainly incorrect.
The Christian Brothers have also relied on an estoppel against the plaintiff. The plaintiff, it was said, consented to a school being built on the lands adjoining his house and the defendants relied on his consent and started to build the school. The evidence shows that the Christian Brothers did not know or rely on what the plaintiff had said when they started to build the school..
The issue whether the user of the adjoining premises as a school will be a breach of the covenant for quiet enjoyment contained in the lease of 1935 was not mentioned in argument because this matter cannot be tried until evidence of the
amount of noise caused by the pupils in the school is available and I express no views on it.
Though the plaintiff’s claim against all the defendants fails, I do not wish to hide the sympathy which I have for him.
Power Supermarkets ltd v Crumlin Investments Limited
Unreported (High Court) 1978 No. 4539 P) (judgment delivered 22nd June, 1981)
The facts are set out in the judgment.
Costello J.:
Power Supermarkets Ltd entered into an agreement with Crumlin Investments Ltd on the 19th day of June 1974 by which Crumlin Investments agreed to grant to Power Supermarkets a lease of portion of a shopping centre in Crumlin which Crumlin Investments was then in the course of developing. The lease was eventu ally granted to Quinnsworth Ltd (a wholly owned subsidiary of Power Super markets). The lease contains a clause by which Crumlin Investments covenanted
‘Not during the term to grant a Lease for or to sell or permit or suffer the sale by any of its tenants or so far as within the Landlord’s control any sub or under tenants of groceries or food products in or over an area exceeding 3,000 square feet in any one Unit forming part of the Shopping Centre unless so ordered or directed by any Court of competent jurisdiction.’
The meaning of this covenant and its operation on the facts of this case are the subject matter of dispute in this action.
I can dispose of one matter of interpretation immediately. The Defendant’s Solicitor took the view that this covenant prohibited Crumlin Investments from making a lease or a letting by which a lessee or a tenant could carry on the prohibited activities, but it did not restrict any trading activities which Crumlin Investments itself might wish to carry on in any unit in the shopping centre. According to this view Crumlin Investments could itself sell groceries and food products in an area over 3,000 square feet if it was so minded. And so an assignee of any part of the freehold would not be bound in any way by the covenant. With respect, I cannot agree with this interpretation. The lessor in my opinion not only covenanted not to allow a tenant to sell groceries and food products in any area exceeding 3,000 square feet in a Unit of the shopping centre but it also covenanted that it would itself not do so. I agree that the covenant was somewhat imperfectly drafted, but the sense must be as I have just suggested. What I have to decide then, is whether this covenant was breached by one or other or both the Defendants.
There are two limited liability companies who are Defendants in this action, Crumlin Investments Ltd., the original lessor, and Dunnes Stores (Crumlin) Ltd. to whom Crumlin Investments conveyed the fee simple interest in a Unit of the shopping centre. The Plaintiffs make two submissions. Firstly, they say that I should look at the reality of the relationship between Crumlin Investments and Dunnes Stores (Crumlin) and hold that Crumlin Investments is in fact carrying on a business in the shopping centre in breach of the covenant. Secondly, and alterna tively, they claim that Dunnes Stores (Crumlin) is bound by the landlord’s covenant and that it threatens to trade in breach of it.
To deal with the first submission I must refer to the history of the Defendant’s involvement in the Crumlin shopping centre. The centre, as I have said, was developed by Crumlin Investments and a number of tenants took leases of different units in it. But the development was not a financial success and a financial institu tion which held a debenture over the property sought a purchaser of it. It approached the well known commercial enterprise to which I will refer as the Dunnes Stores Group. The Group decided to buy and it acquired the property by purchase of the shares in Crumlin Investments. The purchasing company was Cornellscourt Shopping Centre Ltd, and thus Crumlin Investments became its wholly owned subsidiary. But Cornellscourt Shopping Centre Ltd. is a wholly owned subsidiary of Dunnes Stores Ltd. which in turn is a wholly owned subsidiary of Dunnes Holding Co., an unlimited liability company whose shareholders are trustees of a discretionary trust whose beneficiaries are Mr. Ben Dunne and the members of his family. The Dunne Family in fact control all the companies in the Dunnes Stores Group (of which there are something in the region of 150) and actively participate in their running. It was central to the Group’s strategy that a Dunnes Stores Supermarket would be opened in a large vacant unit in the shopping centre. This would not only give the group a new and potentially profitable retail outlet but it was considered that this would attract custom to the whole centre, and would result in the fixing of higher rents on the periodic rent reviews to which all the tenants were subject. But it is the policy of the group that each of its outlets should be operated by a separate company. So, Dunnes Stores (Crumlin) Ltd. was incorporated on the 4th Jun, 1978. Only two shares in this company were issued, and it became a wholly owned subsidiary of Dunnes Stores (George’s Street) Ltd, a company which in its tum is a wholly owned subsidiary of Dunnes Stores Ltd., to which I have already referred.
The Plaintiffs are supermarket operators and carry on business in competition with the Dunnes Stores Group. They were, as can well be imagined, watching with keen interest the advent of the Group at the Crumlin Shopping Centre. Immediately it became clear that the Group was taking over the empty unit in the centre and that it proposed to trade in groceries and food products an application for an interim injunction was brought and a temporary restraining order was made on the 28th July, 1978. On the same day the Group’s Solicitor sent to the Group’s Accountants an engrossment of the conveyance of the fee simple interest of Crumlin Investments in a large vacant unit for execution by Dunne’s Stores (Crum lin). I am satisfied that this happened coincidentally with the interim order and the conveyance, which is dated the 1st August, 1978, was not executed in an attempt to defeat the injunction but in pursuance of an arrangement which had already been agreed upon in the Group. As I have already pointed out the Group’s Solicitor did not consider that Crumlin Investments were prohibited from trading in the manner referred to in the covenant and as they wished to do and as a lease to the new Company could clearly not be made it had been decided instead to convey to the new company the fee simple in the Unit. By this means it was considered that the new company could trade in groceries and food products in an area in excess of
3,000 square feet in the vacant unit and no infringment of the covenant would take place.
I come now to the actual means and method of trading in this unit of the shopping centre. The Dunne family are actively involved in the running of the Dunnes Stores Group of companies, and their wishes prevail, in respect of each company in the Group, including Crumlin Investments and Dunnes Stores (Crum lin). After the initial meeting of the Board of Directors of Dunnes Stores (Crum lin), which is comprised of members of the Dunne family, in 1978 no meeting of the Board has since been held. There has been no meeting of its shareholders. Company Accounts for one year only have been prepared, but have not been presented to any meeting. No meeting of the Directors was held for the purpose of deciding to take a conveyance of the property in the centre and no meetings were ever held to make decisions on trading and commercial matters. Purchases of stock are made on the company’s behalf by the purchasing panel of the Dunnes Stores Group who apportion liability for purchases to each trading company in the Group to whom the goods are invoiced. The Company is managed and controlled not by the members of the Dunne family meeting as Directors of the Company, and not by its shareholders, but by members of the Dunne family (or their servants and agents) meeting informally to manage the affairs of the Group as a whole or by individual members taking decisions on the family’s behalf.
An exactly similar situation has prevailed since the purchase of the shares in Crumlin Investments. Since then there has been no meeting of the Board of Directors of Crumlin Investments (which also comprise members of the Dunne family and their Accountant) and no shareholders meeting has taken place. It, too, is managed and controlled in the same way as Dunnes Stores (Crumlin) is managed and controlled. The reality of the relationship between the two companies is highlighted by the conveyance of the fee simple interest in the unit in the shopping centre. The consideration for this conveyance was only £100 which I am satisfied, notwithstanding the explanation for this figure which was advanced in the course of the evidence, must be regarded as a gross undervalue. It contained no covenant requiring the purchasers to carry on the business which Crumlin Investments required in order to make the shopping centre commercially viable. It contained none of the usual easements granted with a conveyance of this sort. It was never registered in the Registry of Deeds. These omissions are readily understandable when it is appreciated that the two companies are merely vehicles for carrying out the wishes of the Dunne family; they would do what the Dunne family told them to do.
The Plaintiffs submit that I should pierce the corporate veil and look to the realities in this case and hold, notwithstanding the fact that Crumlin Investments and Dunnes Stores (Crumlin) are two separate corporate entities, that the business in the unit is being carried on by a single entity. I was referred to Smith Stone and Knight Ltd. v. Birmingham Corporation (1939] 4 All E.R. 116, a case in which a parent company was held entitled to compensation in respect of a business carried on by its subsidiary on the basis that the subsidiary was in reality carrying it on on behalf of the parent company, and to D.H.N. v. Tower Hamlets London Borough Council (1976] 1 W.L.R. 852 a case also dealing with the payment of compensation for the compulsory acquisition of property. The claimants in that case were a group
of three companies associated in a wholesale grocery business. The Court of Appeal held that it should pierce the corporate veil, and that it should not regard the companies as separate legal entities but treat the group as a single economic entity for the purpose of awarding compensation. I need not refer to the facts of the case; however, the reasons which prompted the court’s approach are very material for the resolution of the issues in the present case. Lord Denning pointed out (page 860) that the group of companies was virtually the same as a partnership in which all three were partners; that they should not be treated separately so as to defect the claim to compensation on the technical point; that they should not be deprived of the compensation which should be justly payable for disturbance. So, he decided that the three companes should be treated as one. Lord Shaw (at page 867) pointed out that if each member of the group of companies was to be regarded as a company in isolation that nobody at all could claim compensation ‘in a case which plainly calls for it’, and he said that the true relationship should not be ignored because to do so would amount to a denial of justice. He too considered that the group should be regarded as a single entity.
It seems to me to be well established from these as well as from other authorities
(See Harold Holdsworth & Co. Ltd. v. Caddies [1955] 1 W.L.R. 352; Scottish Co-operative Wholesale Society Ltd. v. Meyer [1959] A.C. 324) that a Court may, if the justice of the case so requires, treat two or more related companies as a single entity so that the business notionally carried on by one will be regarded as the business of the group, or another member of the group, if this conforms to the economic and commercial realities of the situation. It would, in my view, be very hard to find a clearer case than the present one for the application of this principle. I appreciate that Crumlin Investments is a property-owning not a trading company but it is clear that the creation of the new company and the conveyance to it of the freehold interest in a unit in the shopping centre were means for carrying out the commercial plans of the Dunne family in the centre. The enterprise had a two-fold aspect (a) the creation of a new retail outlet for the Dunnes Stores Group in the shopping centre and (b) the enhancement of the rents in the centre as a whole which the creation of such an outlet would hopefully produce. To treat the two companies as a single economic entity seems to me to accord fully with the realities of the situation. Not do to so could involve considerable injustice to the Plaintiffs as their rights under the covenant might be defeated by the mere technical device of the creation of a company with a £2 issued capital which had no real independent life of its own. If it is established that the covenant is breached there should in my opinion be an injunction against both Defendants.
Even though the finding I have just made determines the parties’ rights in this
action I think I should also express my views on the Plaintiff’s second, alternative, submissions as the parties may wish to have my decision on all aspects of the case. They urged that the lessor’s covenant in this case ran with the land and that Dunnes Stores (Crumlin) were bound by it when they took the conveyance of the 1st August, 1978. The Defendants claimed that they were not and in support of their contention relied on Thomas v. Haywood L.R. 4 Ex. 311. But that case in my view does not help them – it dealt with the right of the assignee of the lessee’s interest to sue on a covenant in the lease. The present case is one involving the enforcement of a restrictive covenant against the successor in title to the freehold interest of the covenantor, and different principles apply.
The principle of equity which was developed in the last century is that the burden of a restrictive covenant runs with the land to which it relates so as to bind successors in title of the original covenantor, except in the case of a bona fide purchaser without notice. The basis of this rule is that the covenant is concerned w ith preserving the value of the land retained by the covenantee. For it to apply there must be a clear intention that the burden is to run. (See: Wylie Irish Land Law paragraphs 19.25 to 19.43, and London and S.W. Railway Co. v. Gomm 20 Ch. D. 562, at 583). Here, I think there can be little doubt that the parties to the lease intended that the lessor’s covenant would run with the land. It is true that the lessor did not expressly covenant on behalf of its successors and assigns, but it could not have been intended that the day after the execution of this lease the lessor would have been at liberty to convey the fee simple of a unit in the shopping centre so as to permit a grantee of the fee simple to trade in a way forbidden to a lessee of the same unit. It is equally clear that the covenant is a restrictive one and that Dunnes Stores (Crumlin) had notice of it. If, therefore the trading which is proposed for the unit breaches the covenant Dunnes Stores (Crumlin) should be restrained from continuing it.
That brings me to the last issue in the case – one that can be briefly dealt with. It
is admitted that the sale of groceries and food products in the Unit conveyed to Dunnes Stores (Crumlin) has taken place, and will take place if an injunction is not granted. But it is said that the covenant has not been breached because in ascertain ing the area embraced by the covenant only the area in which a sale actually takes place can be counted, that it to say only the area where the cashier sits and receives payment. As the check-out areas so occupied in this case are well below 3,000 square feet, there has, it is said, been no breach. Although ingenious, this in terpretation fails adequatedly to have regard to what the parties must have intended by the covenant. The lessor and the lessee were well aware of contempor ary methods of retailing in the grocery trade and quite obviously they were agreeing that in consideration of the execution by Quinnsworth of a lease of a unit in the shopping centre a business of substance in competition to Quinnsworth’s would not be permitted in another unit in the centre. To limit the clause to the areas now suggested would it seems to me do violence to the parties’ intentions.
I will therefore make an order in the terms of paragraph (a) of the prayer in the
Statement of Claim. If any dispute arises as to the implementation of this Order the case can be re-entered for argument.
Carrick v. Morton
[2002] IEHC 65 (13 June 2002)
THE HIGH COURT
2002 No. 6386p
BETWEEN
DESMOND CARRICK
Plaintiff
and
JUSTIN MORTON
Defendant
JUDGMENT of Mr Justice Kelly delivered the 13th day of June, 2002.
1. This action began on the 2nd May, 2002. In it the plaintiff claims a declaration that he is entitled to rely on a restrictive covenant which is contained in a deed of conveyance of the 29th July, 1954 entered into between Patrick Joseph McGrath and the plaintiff in respect of lands known as Woodtown in the barony of Upper Cross and County of Dublin.
2. The plaintiff is a professional artist and a member of the Royal Hibernian Academy. When he bought his property in 1954 he did so with a view to both living there and also setting up his studio. In order to be able to paint he says, he required both good light and calm. It was therefore of importance to him that the lands surrounding the property which he was buying would not be built on. Because of that the vendor, Mr McGrath, entered into the covenant which is the subject of these proceedings whereby he agreed to in effect sterilise the land outlined in green on the map annexed to the 1954 deed. The land was sterilised by virtue of Mr McGrath agreeing that he his heirs and assigns should not at any time erect or allow to be erected any buildings of any kind on the lands outlined in green.
3. The deed in question was registered at the Registry of Deeds on the 15th July, 1954.
4. In 1968 by a conveyance dated the 28th June the vendor, Patrick Joseph McGrath conveyed the sterilised lands to his son Joseph McGrath.
5. By a conveyance of the 12th November, 1991 Joseph McGrath conveyed land including part of the sterilised land to the defendant in these proceedings.
6. The sterilised land consists of eleven acres, two roods and twenty two perches. The area of the portion of the sterilised land acquired by the defendant is approximately one acre.
7. The lands in suit have been in the ownership of the defendant since 1991. In March, 2001 the defendant applied for planning permission to build a dwelling house on the part of the sterilised land sold to him. On the 3rd April, 2001 the plaintiff wrote to South Dublin County Council objecting to the application on various grounds including the existence of the covenant precluding building on the premises. Notwithstanding the objection, planning permission was granted on the 14th January, 2002. The plaintiff says that he intended to appeal that decision but made a procedural error in that regard and as a result his appeal was not considered.
8. On the 7th December, 2001 the plaintiff wrote to the defendant in the following terms:
“It has come to my notice that South Dublin County Council planning department granted you permission for a three bedroom bungalow at Kilakee Road and placing it within that area outlined in green on the enclosed map.
As you should be aware, that portion of land is sterilised from further building under a covenant agreed and signed between the late Patrick Joseph McGrath and myself and binds the heirs and assigns of both parties.
No third party has authority to break this covenant.
For your benefit I am attaching a copy of my deed of conveyance within which the covenant is recorded, for your solicitor’s attention. Should you start building on any part of that sterilised land then I shall enforce the covenant to prevent a precedent for further development and devaluation of my own property”.
9. That letter was replied to by the defendant’s solicitors on the 21st January, 2002.
10. Having pointed out that they had taken senior counsel’s opinion on the defendant’s position they said
“Our client purchased his land in 1991 without notice of the existence of the covenant in your favour. The senior counsel in his opinion cited s.3(1) of the Conveyancing Act, 1882 which says
‘Provided that a purchaser would not be prejudiced by notice of any instrument, fact or thing unless it was actually in his knowledge or would have come to his knowledge if such inquiries and inspections had been made as ought reasonably to have been made by him, or it came to the notice of his agent’
On the basis of this the senior counsel states that our client should not be bound by the covenant as he had no knowledge of it at the time of his purchase nor had his agent any knowledge of the covenant.
On the basis of the above our client intends proceeding to build on foot of his grant of planning permission”.
11. On the plaintiff’s own admission in mid March, 2002 construction work commenced. He viewed the lands on Monday the 29th April, 2002 where work on the foundations had been completed. He viewed it again on the 2nd May, 2002 when the walls had been built and five men were working on the site.
12. In the meantime correspondence was being exchanged between the solicitors but it is not necessary for the purpose of this ruling to deal with that in extenso. It is sufficient to recite that the defendant throughout that correspondence contends that he is not bound by the covenant because he had no actual notice of it, does not have constructive notice of it and is a bona fide purchaser for value without notice. On the plaintiff’s side it is said that he is bound by the terms of the covenant because it is registered in the Registry of Deeds and when he purchased he chose to take a short root of title with all the perils attendant upon that course. As a result whilst he remained unaware of the 1954 conveyance he is nonetheless bound by it.
13. This is an application for an interlocutory injunction. It is accepted by the defendant that there is a serious issue to be tried concerning the question of whether or not the defendant is bound by the covenant. But even if he is, it is not accepted that it follows that injunctive relief would be granted at trial. I propose to deal with the case on the basis of traditional interlocutory injunction principles since it does not appear to me that the case has about it the attributes which would be required to make relevant the views expressed by McCarthy J. in Irish Shell v Elm Motors.
14. I am however, satisfied, as indeed the defendant has sensibly accepted, that there is a serious issue to be tried.
15. I turn to the next question which is whether or not damages would be an adequate remedy.
16. In this regard a number of points are made by the defendant. It is pointed out that there is a substantial distance between his development and the dwelling house and studio of the plaintiff. The plaintiff’s house situate at such a distance is surrounded by no fewer than three rows of trees, two of which are deciduous and one of which in coniferous. Given the distance, the intervention of the trees, and the scale of the defendant’s development it is said that there is not nor could there by any real interference with the plaintiff’s quiet enjoyment of his premises.
17. For the plaintiff it is said that he is entitled to what he purchased and that it is no answer on the part of the defendant to say that money can buy off a right to which such weight and attention was given by the plaintiff. As against that the defendant points out that the plaintiff was himself willing to permit a planning permission to be obtained on his own lands for members of his family.
18. This is not the trial of the action and I am precluded from making any final or binding determinations of either fact or law. However, it seems to me that on the present state of the evidence I cannot say that in the circumstances of this case damages would necessarily be an adequate remedy particularly having regard to the plaintiff’s livelihood. I therefore conclude that for the purposes of the interlocutory hearing damages would not be an adequate remedy and therefore must then go on to consider the balance of convenience.
19. The principal ground which is relied upon by the defendant in this regard is the delay of the plaintiff in instituting these proceedings. He has known of the defendant’s intentions since the time the planning permission was sought and obtained. He was told in January of the plaintiff’s intention to proceed. He saw the development commence about the middle of March on his own admission. Yet he allowed the development to proceed before instituting these proceedings on the 2nd May. The plaintiff says that whilst he was aware of the works commencing in mid-March, 2002 he informed his solicitors on the 17th March, 2002 of such state of fact. He says however, that he could not have been sure that the work was necessarily that envisaged in the planning permission. He went to Spain to paint from the 4th April to the 26th April, 2002 and therefore was away for much of the month in respect of which the work was going on. When he returned from Spain he inspected the works on the 29th April and saw that the foundations had been poured. These proceedings were instituted a few days later. Whilst the proceedings were somewhat tardy, it does not appear to me that any particular inconvenience has been addressed in the evidence of the defendant in the event of an injunction being granted other than the obvious delay to the carrying out of the work. But there is no evidence of any specific damnification apart from that.
20. In these circumstances I have come to the conclusion that the balance of convenience lies in favour of the grant rather than the refusal of the injunction. If I refuse it then the work on the house will be completed. If the plaintiff is ultimately successful then the house will have to be removed. In a sense that is detrimental to the defendant’s interest. If on the other hand the injunction is granted it will hold up the completion of the work but I may ultimately be doing the defendant a service in that regard. If however, the defendant is successful at trial and an injunction is refused, then it seems to me that the undertaking as to damages which the plaintiff must give would be adequate compensation for the delay or any additional costs incurred by the holding up of the work.
21. I am therefore going to grant the injunction sought but I am also going to certify the case as fit for early trial and I will give consequential directions as to the exchange of pleadings presently.
O’Mara & Anor v. Morrison
[2003] IESC 53
(13 October 2003)
BETWEEN/
ALPHONSUS O’MARA AND
CLAUDIA O’MARA
Plaintiffs/Respondents
and
VAN MORRISON
Defendant/Appellant
JUDGMENT of Mr. Justice Geoghegan delivered the 13th day of October 2003 [Nem Diss]
The respondents are the owners and occupiers of a substantial house with grounds in Dalkey, Co. Dublin. At the time of purchase a total price of IR£1,010,000 was expressly apportioned so that IR£120,000 of the total purchase price was attributed to the benefit of certain covenants and easements. The purpose of the covenants was essentially to secure privacy for the respondents and they were, therefore, highly restrictive of development. Alleged breaches of these covenants have led to this litigation.
The case comes before this court by way of appeal from an order of the High Court (Kelly J.) made the 14th of February, 2003. In the High Court it was sought to injunct intended works for the purposes of widening a driveway from the public road which serviced both the respondents’ house and a house on the retained lands owned and occupied by the appellant. A mandatory injunction was also sought with a view to reinstating a hedge which had already been removed.
In effect there were three issues before the High Court. First of all it was alleged that these works contravened the protective covenants. Secondly, there was an issue as to whether planning permission was required for the carrying out of these works. That second issue, although ruled on in a kind of provisional way in the judgment of the learned High Court judge was to some extent a moot for the following reasons. Without prejudice to the view of his advisers that planning permission was not necessary the appellant did in fact apply for planning permission. That permission had not been granted as of the date that the proceedings were instituted and for that reason an injunction under the Planning Acts was sought as an alternative remedy to an injunction for the breaches of covenant. As of the date of hearing in the High Court a permission had been issued by the local planning authority but this was under appeal to An Bord Pleanála. It emerged at the hearing of this appeal that An Bord Pleanála has overruled the decision of the planning authority and has refused the permission.
The appellant having chosen to go the planning permission route, I do not consider that this court should now make any ruling as to whether planning permission was or was not necessary. It seems to be more or less conceded that despite the observations of the learned High Court judge, the planning issue did not loom large at the High Court hearing because of the fact that permission had in fact been granted. What particularly concerns me about expressing any view on it is that under s. 5 of the Local Government (Planning and Development) Act, 1963 and the equivalent replacement section in the current legislation the question as to what in any particular case is or is not “development” or “exempted development” has to be referred to and decided by Bord Pleanála. There is then an appeal from that decision to the High Court. I am doubtful that that procedure can be by-passed in the manner attempted in this case, but at any rate I do not find it necessary to express any view on it. In my view, the terms of the covenants determine this appeal. To an extent however the planning question may arise in relation to the obligations under the covenants also and I will be returning to that in due course.
The third issue related to whether a particular wall was a party wall or not the relevance of this being whether the appellant was a trespasser in relation to certain aspects of the works. The learned High Court judge did not find it necessary to make any decision on that point. If this court were to find it necessary that the party wall issue be determined it would have to send the case back to the High Court.
The learned High Court judge, in his judgment, raises the question as to whether there might in fact be a fourth issue. At p. 12 he said the following:
“I myself raised a fourth issue which seemed to me to be one of considerable practical importance from the point of view of carrying out development to the lower part of the driveway. I found it difficult to see how the driveway could be widened without the defendant acting in excess of his right of passage and repassage over the existing lower driveway which is in the ownership of the plaintiffs. I thought it unlikely that works of that type could be carried out without trespass and so would be an interference with the plaintiffs’ rights in respect of that stretch of the driveway. The evidence of the plaintiffs’ architects was to the effect that it would be quite impossible to carry out the works contemplated without such interference.”
While there seems to be considerable force in the observations of the learned judge, I do not think that it would be appropriate to broaden the issues on the appeal and in that regard even the plural is doubtfully appropriate because in my view the only matter which this court can now determine is whether the learned High Court judge was correct or incorrect in his view that the proposed works would constitute breach of covenant.
Although the case lasted several days in the High Court with oral evidence, the only factual matters, apart from general explanation of the geography of the property which needs to be elaborated on in this appeal is certain relevant correspondence between the parties.
The problems began with a relatively innocuous letter of the 24th of October, 2001 from the appellant’s architect, Mr. Chris Ryan, to the respondents’ architect, Mr. Desmond Crean. That letter read as follows:
“Dear Desmond
Re: New driveway to Kilross House and others
Following discussions with Conor Cavanagh, the new owner of Mount Alverno and his architect, Desmond Sheehan of Sheehan and Barry, and Joe Kennedy, Eddie Irvine’s architect, we have prepared proposals for the driveway, a copy of which is enclosed.
The proposal should not affect your client much. We have made arrangements for the occupants of Kilross House to park and have access from Mount Alverno. We will be connecting into the front gate with an as yet to be decided entry system. We will also be putting in lighting in the new driveway. We will have to liaise in the lighting on the lower portion of the driveway, to the north of your client’s portion of the drive. When we have the legals wrapped up, we will be producing further details which we will pass on to you for your information and comment.
If you have any initial comments, please let me know.
Yours sincerely
Chris Ryan”
In order to understand that letter it should be explained that on what I have already referred to as “the retained lands” were three other houses “Mount Alverno” (not to be confused with Monte Alverno, the respondents’ house) “Kilross” and “The Chalet”. The same entrance serves all three of these houses together with the respondents’ house. As one drives up the driveway from the public road which is Sorrento Road in Dalkey the first house is the respondents’. The driveway up to that point is part of the respondents’ property but the occupiers of the other three houses enjoy a right of way over it. I will refer to some other geographical features when treating of later correspondence.
The letter of the 24th of October, 2001 elicited a reply from Mr. Crean dated the 2nd of November, 2001 in the following terms:
“Re: Kilross and Monte Alverno
Dear Chris
Thank you for your letter of the 24th of October, 2001 and enclosure.
I will be away from 7th to 11th with the RIAI Conference and hope to meet Phons O’Mara the following week when we
will discuss and make any comments considered relevant as soon as possible.
Yours sincerely
Desmond Crean”
Mr. Crean wrote a further letter then to Mr. Ryan dated the 19th of November, 2001 and that reads as follows:
“Your client: Kilross House
Our client: Monte Alverno
Dear Chris,
We met as promised our client Phons O’Mara on Wednesday 14th of November last and advise you hereunder of our client’s concern as follows:
1. Maintenance:
Despite previous attempts no offer has ever been made by your client for the shared costs associated with the main gates and driveway. This is an ongoing costs for a facility enjoyed by your client and others but managed and paid solely by our client.
2. Bell at Gate:
We believe this was agreed many years ago. Basically our client does not wish to be inconvenienced with any work being carried out.
3. Electrics, lights, security:
Refer to 1 above.
4. Driveway general:
Our client will be concerned about keeping the existing driveway clean of debris, sand, soil etc. from the proposed works. We would draw your attention to two problems.
(a) Excessive dirt collecting in existing gate mechanical system at base and causing the gates to not operate.
(b) At present an acceptable amount of water cascades down the driveway. It would be of some concern if this is increased by the new hard surface. We strongly suggest you consider drains across the new driveway taken to the surface water system to prevent a greater increase of water which if increased will be like a river on the main lower driveway.
5. Foundations:
We trust there will be no interference of existing walls to Monte Alverno. We should be advised if there will be any disturbance.
6. Pedestrian gate to Monte Alverno:
We note a new wall to be constructed and is shown abutting the side pillar of the pedestrian gate. We would like to agree a detail of this proposal.
7. Disturbance:
Basically our client wishes to be left alone and not disturbed.
At present he acts as an answering service for your client and others on the site, despite meetings to resolve same many years ago.
8. Fees:
We indicated some fee involvement as our client will not meet same we indicated £300 or thereabouts already we have spent four hours not to mention previous meetings over the years. If we are to be involved we wish to be paid monthly based on a monthly time basis when the above reaches £500 net. Our hourly charge will be £120 for a principal and £60 for staff members as appropriate. Finally, the above points are brief and there may be other issues that will need addressing. We await hearing from you.
Yours sincerely
Desmond Crean”
It is obvious that as of that stage the parties were in civilised correspondence and no serious dispute had arisen. All that changed with the next letter from Mr. Ryan to Mr. Crean dated the 22nd November 2001. There were eight bullet points in that letter and I do not find it necessary to cite it in full. To a certain extent it was simply dealing with points that have already been referred to, but what was new was the third point in the letter which was headed “Electrics, lights, security”, etc. and it read as follows:
“It is our client’s wish to widen the lower stretch of the right of way, making the whole approx. 5m wide. (See attached sketch). In the immediate short term we intend to remove the vegetation to the back which work will start next week. We will be running our services between the gate and Kilross House and Mount Alverno in this area. We are aware that your client has placed his security cameras, lighting and associate cabling on our client’s property in this area. These will be affected by the works and we must agree on a new position for them. We would be grateful for your suggestions on this.”
The letter ended with the following sentence:
“As some works are being started next week, we would appreciate any comments or suggestions as soon as possible.”
The map annexed to that letter showed very extensive changes to the driveway. While the object was to widen it quite substantially that involved considerable work. It would seem reasonably obvious that the appearance and character of the driveway would be significantly changed.
That letter of the 22nd of November was replied to by a letter of the 27th of November, 2001 from Mr. Crean to Mr. Ryan and it read as follows:
“Re: Monte Alverno
Dear Chris
I write to advise my client’s deepest concern regarding many proposals suggested in your letter dated 22nd of November 2001.
We have been asked to refer the matters of boundaries, removal of trees, shrubs, lights, cameras, widening of driveway to our client’s solicitor to check your client’s right to carry out such work without our client’s consent on or near our client’s property.
I suggest that both of our clients’ solicitors agree the lease legalities before any work is carried out.
I trust no work will start on the areas referred to without advising us.
Yours sincerely”
In actual fact because it appeared that the works were going ahead these proceedings were instituted on the 30th of November, 2001 and on the same day an interim injunction was granted by the High Court (Lavan J.). That injunction subject to an agreed variation continued until the date of hearing.
Apparently, the letter of the 22nd of November, 2001 was not received by Mr. Crean until Monday the 26th of November. In relation to the reaction to that letter Kelly J. at p. 9 of his judgment says the following:
“I accept the plaintiffs’ architect’s evidence when he says that he was greatly surprised by this letter because included with it was a single sheet plan which represented in diagrammatic form the proposal which was made for the first time in the letter concerning works to be done on the lower part of the driveway. The plaintiffs’ architect immediately became concerned and contacted the first-named plaintiff.”
I have already observed that the lower part of the driveway was owned by the respondent, the other house occupiers having merely a right of passage over it. The upper part of the driveway however was owned by the appellant. What complicated matters was that the appellant also owned as part of his take, a strip of land adjoining the lower part of the driveway.
The next part of the High Court judgment is also relevant and it reads as follows:
“I accept the evidence of the plaintiffs’ architect that he met the defendant’s architect on site on the 29th. At that stage a contractor had moved in and was carrying out excavations of part of the driveway which is in the ownership of the defendant. A considerable amount of excavation had been done to lead to a widening of that part of the driveway. A number of shrubs and trees of about twenty feet in height had been removed. These trees gave considerable privacy to a number of houses. Deep concern was expressed by the plaintiffs’ architect to the defendant’s concerning what had happened and he also resurrected an issue which had figured previously in discussions namely, his view that planning permission was required for this work. He took that view because in his opinion Kilross House was a protected structure and he said that any part of a site or building or structure which is protected requires planning permission. The defendant’s architect was of a different view.
The plaintiffs’ architect gave evidence that the proposals in respect of the widening of the driveway at the lower end could not be carried out without affecting the existing driveway owned by the plaintiffs. He said that it would be impossible not to disturb the existing driveway while carrying out the proposed works.”
The learned judge went on to point out that the plan which accompanied the letter of the 22nd of November in addition to showing the proposed works also showed a low wall. There was a dispute as to whether that wall was a party wall or not or whether it was the property of the appellant. It has been pointed out in counsel’s submissions that the expression “party wall” had several meanings but nothing turns on that here. Either the wall was the sole property of the appellant or the respondents had some ownership interest in it. As I have already pointed out this court cannot be concerned with this issue since it was never determined in the High Court.
Did the proposed works contravene the covenants? The learned High Court judge held that they did. As to whether he was right or wrong in that view is the only question in my opinion which this court can now consider. It is, therefore, immediately necessary to set out the relevant covenants in full.
The deed in which the relevant covenant is contained is an indenture of conveyance and assignment dated the 11th of December, 1992 and made between Renata Elisa Coleman (otherwise Renata Eliza Coleman) of the first part, Kilross Estates of the second part and Alphonsus O’Mara and Claudia O’Mara of the third part. The restrictive covenant is contained in paragraph 1.4 of the conveyance and reads as follows:
“The First Vendor and the Second Vendor HEREBY JOINTLY AND SEVERALLY COVENANT with the purchasers so as to bind the owners and occupiers for the time being of the Retained Lands and so that this Covenant shall be for the benefit and protection of the Sold Lands, as appurtenant rights in relation thereto and every part thereof and shall enure for the benefit of the purchasers and the persons deriving title under them to the Sold Lands or any part thereof, THAT;
1.4.1 Development of the Retained Lands (save and except the Pink Lands) shall be restricted to:
(a) the extension, renovation, alteration or rebuilding of each of the existing houses respectively known as ‘Mount Alverno’, ‘Kilross’ and the ‘Chalet’ provided that such works shall not involve any change of use. AND
(b) the construction of an additional two houses each to be used as a single private dwelling house only, each to comprise an area not exceeding four thousand square feet and each to be located and constructed so as to maintain the level of privacy of the Sold Lands as at present existing in relation to same.
1.4.2 No development whatsoever shall be carried out within the boundaries of the Pink Lands SAVE the construction and use of a driveway leading from the Right of Way area shown hatched black on Map 2 annexed hereto the line of which driveway may encroach on the Pink Lands north of the points marked “G” and “H” on said Map 2.”
An immediate problem arises as to what is meant by ‘Development’ in the deed. The learned High Court judge suggests two alternative interpretations. The first of these which is the one which finds favour with him, is that it is self-defining having regard to the wording of the deed. The second is that it had the same meaning as the meaning which it has under the Planning Acts. In the written submissions lodged on behalf of the appellant in the High Court a third alternative is suggested which would certainly in my view be open to argument. It is suggested that development meant development within the meaning of the Planning Acts but excluding “exempted development”. A fourth possibility might be to give the word “development” its ordinary dictionary meaning or to put it another way the kind of meaning it would have been given if contained in a deed before 1963. However, I am quite satisfied that this last meaning could not be the correct one in this case having regard to the terms of the covenant and at any rate it was never argued. As I understand it from the written submissions and what was argued at the appeal the self-defining interpretation applied by the learned High Court judge is not seriously in dispute between the parties. What is in dispute is the learned High Court judge’s application of his own definition. The appellant contends that the proposed works fall within the expression
” the extension, renovation, alteration or rebuilding of each of the existing houses respectively known as ‘Mount Alverno’, ‘Kilross’ and ‘The Chalet’ provided that such works shall not involve any change of use.”
The respondents contend that the works in controversy in this case fall well outside that expressly permitted limited development and they further contend that the works cannot be implicitly permitted by the deed as being merely ancillary to the permitted development.
The trial judge did not agree with those submissions put forward on behalf of the appellant. To a certain degree the view of the learned trial judge has been borne out by the ultimate refusal of the permission by An Bord Pleanála. Clearly, An Bord Pleanála took the view as did the learned trial judge that this was development which substantially altered the nature of the driveway and its environs. It would appear also that the learned trial judge was influenced by the fact that in relation to the lower part of the driveway what was involved was not the extending of the width of a driveway owned by the developer but rather adding a strip of the developer’s own land onto a driveway over which he had merely a right of way.
The written submissions lodged in this court on behalf of the appellant have rather unfairly characterised the views of the learned High Court judge as so restrictive as to lead to absurdities which might prevent quite minor works in the future. There are two points which I would make in relation to this submission. First of all, I do not agree that the judgment of the High Court can be characterised in that way. Secondly, if and in so far as the learned High Court judge expressed views that were not strictly relevant to the facts of this case he was merely speaking obiter. Counsel for the appellant at the oral hearing of this appeal was inclined to encourage this court to go a step further and to lay down the parameters of the covenants so as, as it were, to provide the appellant with more satisfactory title deeds into the future. It would be both wholly inappropriate and wholly unwise for this court to accept that invitation. Any problems that may arise out of ambiguity and draftsmanship can only be determined on a case by case basis. But any decision of this court should relate only to the actual works involved in the litigation.
It is important to reflect on the purpose of the covenant. It is not there to prevent unauthorised development. The Planning Acts already provide adequate remedies for that purpose. It is there to prevent development which would otherwise be authorised under the Planning Acts. Obviously, there is an overlap but the primary concern of the respondents when purchasing the property would have been to protect themselves from development for which permission under the Planning Acts might in fact be given.
I take the view that the appeal ought to be dismissed. As to whether there should be any alteration in the terms of the order made by the High Court in the light of the subsequent refusal by An Bord Pleanála can be discussed with counsel.
UK Cases
Baxter v Four Oaks Properties Ltd
[1965] Ch 816 Chancery Division (Cross J)
Cross J.
‘I will, therefore, make a declaration that the plaintiffs are entitled to enforce the covenants against the defendants and that the use of the building in question as flats will be a breach of the relevant covenant.
… there is no covenant against erecting a block of flats. The plaintiffs cannot, and do not ask for an order that the defendants pull down the building which they have put up: they ask only for an order that the defendants do not use the building as flats. The effect of granting such an order would, of course, be to put the plaintiffs in a very strong bargaining position, for, unless the defendants were prepared to leave the building unused, they would be forced to buy a release of the injunction. Nevertheless, what the plaintiffs would get in the end would only be damages though, no doubt, more damages than they would get if no injunction were granted …
… the defendants did not deliberately act in a way which they knew would involve a breach of covenant.
They thought – wrongly as I have held – that the covenant did not extend to flats. All these considerations lead me to think that this is a case where I ought not to grant an injunction, but should award damages instead.’
Brunner v Greenslade
[1971] Ch 993 Chancery Division (Megarry J)
Megarry J:
‘Where there is a head scheme, any sub-purchasers are bound inter se by the covenants of that head
scheme even though they have entered into no covenants with the sub-vendor or with each other. What binds the sub-purchasers inter se is not any covenant of their own making, for there is none, but an equity independent of any contractual obligation entered into by them, and arising from the circumstances of the existence of the head scheme, the process of sub-division into sub-lots and the disposal of those lots. If on disposal the common intention was that the local law created by the head scheme should apply within the sub-area, then apply it would. It would be remarkable if the restrictions of the head scheme were to be reciprocally enforceable between the owner of a sub-plot and a plot elsewhere on the estate, however distant, and yet unenforceable as between neighbouring owners of sub-plots.’
Dolphin’s Conveyance, Re
[1970] 1 Ch 654 Chancery Division (Stamp J)
Stamp J:
‘ … if one finds conveyances of the several parts of an estate all containing the same or similar restrictive covenants with the vendor, that is not enough to impute an intention on the part of that vendor that the restrictions should be for the common benefit of the vendor and the several purchasers inter se. For, it is at least as likely that he imposed them for the benefit of himself and of the unsold parts of the estate alone. That is not this case … For what possible reason does a vendor of part of an estate, who has extracted restrictive covenants from a purchaser, covenant with that purchaser that the other parts of the estate, when sold, shall contain the same restrictions, unless it be with the intention that the purchaser with whom he covenants as well as himself shall have the benefit of the restrictions when imposed …
As a matter of construction of the conveyances, I find that what was intended, as well by the vendors as the several purchasers, was to lay down what has been referred to as a local law for the estate for the common benefit of all the several purchasers of it.
To hold that only where one finds the necessary concomitants of a building scheme or a deed of mutual covenant one can give effect to the common intention found in the conveyances themselves, would, in my judgement, be to ignore the wider principle on which the building scheme cases are found and to fly in the face of authority …
There is not … a dichotomy between the cases whose effect has been given to the common intention inferred from the existence of the concomitants of a building scheme and tho’se whose effect has been given to the intention evidenced by the existence of a deed of covenant … Here the equity … arises not by the effect of an implication derived from the existence of the four points specified by Parker J (in Elliston v Reacher [1908] 2 Ch 374 or by the implication derived from the existence of a deed of mutual covenant, but by the existence of the common interest and the common intention actually expressed in the conveyances themselves …
The conveyances of the several parts of the estate taking the form they do and evidencing the same intention as is found in a deed of mutual covenant, I equate those conveyances with the deed of mutual covenant considered by Cross Jin Baxter v Four Oaks Properties Ltd [1965] Ch 876 … as showing the common intention. So equating them, I follow what I conceive to be the ratio decidendi of Baxter v Four Oaks Properties Ltd and give effect to that intention by holding that the restrictive covenants are enforceable by the successors in title of each of the original covenantors against any of them who purchased with notice of those restrictions.’
Elliston v Reacher
[1908] 2 Ch 374 Chancery Division (Parker J); affirmed by the Court of Appeal [1908] 2 Ch 665
Parker J:
‘In my judgment, in order to [establish a building scheme] … it must be proved: (1) that both the plaintiff and defendants derive title under a common vendor; (2) that previously to selling the lands to which the plaintiffs and defendants are respectively entitled the vendor laid out his estate, or a defined portion thereof (including the lands purchased by the plaintiffs and defendants respectively) for sale in lots subject to restrictions intended to be imposed on all the lots and which, though varying in details as to particular lots, are consistent and consistent only with some general scheme of development; (3) that these restrictions were intended by the common vendor to be and were for the benefit of all the lots intended to be sold, whether or not they were also intended to be and were for the benefit of other land retained by the vendor; and (4) that both the plaintiffs and the defendants, or their predecessors in title, purchased their lots from the common vendor upon the footing that the restrictions subject to which the purchases were made were to enure for the benefit of other lots included in the general scheme whether or not they were also to enure for the benefit of other lands retained by the vendor. If these four points be established, I think that the plaintiffs would in equity be entitled to enforce the restrictive covenant entered into by the defendants or their predecessors with the common vendor, irrespective of the dates of the respective purchases.
I may observe, with reference to the third point, that the vendor’s object in imposing the restrictions must in general be gathered from all the circumstances of the case, including in particular the nature of the restrictions. If a general observance of the restrictions is, in fact, calculated to enhance the values of the several lots offered for sale, it is an easy inference that the vendor intended the restrictions to be for the benefit of all the lots … further, if the first three points be established, the fourth point may readily be inferred, provided the purchasers have notice of the facts involved in the first three points.
It is also observable that the equity arising out of the establishment of the four points I have mentioned has been sometimes explained by the implication of mutual contracts between the various purchasers and sometimes by the implication of a contract between each purchaser and the common vendor, that each purchaser is to have the benefit of all the covenants by the other purchasers, so that each purchaser is in equity an assign of the benefit of these covenants. In my opinion, the implication of mutual contract is not always a perfectly satisfactory explanation …
Under all the circumstances of the case, it is in my opinion sufficiently established that the predecessor of the plaintiffs and the defendants respectively had notice of the intention of their common vendors that the restrictions in question should enure for the benefit of all the lots offered for sale, but that they made their respective purchases on that footing.
… I hold, therefore, that the plaintiffs are … entitled in equity to enforce the covenants in question.’