Rysaffe Trustee Company (CI) Ltd & Anor v Ataghan Ltd & Ors [2006] EWHC 2324 (Ch)

Case No HC04C03082

[2006] EWHC 2324 (QB)

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION

Venue Royal Courts of Justice

Date 8 th August 2006

Strand

London WC2A 2LL

Before

MR C FREEDMAN QC

sitting as a deputy judge of the high court

Between

RYSAFFE TRUSTEE COMPANY (Cd.) LIMITED (1)Claimants

SAFFERY TRUSTEE COMPANY (C.I.) LIMITED (2)Claimant

ATAGHAN LIMITED (1)Defendants

ANDREW THOMAS FOLEY (2)Defendant

ELLIOTT AND SONS LIMITED (3)Defendant

NICHOLAS MICHAEL ELLIOTT (4)Defendant

STEPHEN JAMES FREDERICK ELLIOTTDefendant

JUDGMENT

INTRODUCTION

[1]This case concerns various rights to a plot of land known as Part OS 50 relating to Perton Quarry, a working quarry on the Stoke Edith estate, Herefordshire. The Stoke Edith estate has been owned by the Foley family, or trusts or companies connected with them, since the late seventeenth century. The Second Defendant (“Mr. Foley”) is currently the senior member of the family.

[2]The Claimants are the current trustees of a settlement made by Mr. Foley on 18 October 1978. The settlement is commonly known as “T5” to distinguish it from others made by Mr. Foley. The principal beneficiary of T5 is the eldest son of Mr. Foley, Rupert Foley, who was born on 16 March 1970.

[3]The background to the dispute is that, as commonly occurs, property was put into a family settlement as part of tax planning. This followed the experience of the maximum level of estate duty being payable following the death of Mr. Foley’s father. It was to this end that the First Defendant was created, as well as a substantial number of family trusts, thereby greatly reducing the assets of Mr. Foley. Unfortunately, relationships within the family have deteriorated. On 9 January 1995, Mr. Foley and Mrs. Gillian Foley, his first wife were divorced, and at about that time personal relations between Mr. Foley and his son Rupert broke down. It is unlikely that the dispute between the parties as to rights to a field among many fields would have arisen or would have had any practical effect if the relationships had not become sour. For whatever reasons, they do not matter for this judgment, members of the same family now have different interests. The result is that notwithstanding that the original intention was to protect the interests of the family as a whole, there is now in effect a dispute between neighbouring landowners. On the one hand, there are the trustees of the Settlement and on the other hand there is the settlor, Mr. Foley. I mention this at the outset because there were times hearing a case which has a very complicated factual history when the dispute appeared to have no context. This is the context. What caused the family difficulties are irrelevant to my adjudication. I shall not need to revert to it.

[4]The First Defendant (“The First Defendant”) is a company whose share capital consists of 47,363 £1 preference shares and 5,002 £1 ordinary shares. The preference shares are entitled to a non-cumulative preference dividend of 10%. All shares carry equal voting rights, but on a winding up preference shares obtain only a return of capital. The First Defendant is a company whose share capital consists of 47,363 £1 preference shares and 5,002 £1 ordinary shares. The directors of the First Defendant are Mr. Foley and a solicitor Mr. Underwood. The revenue of the First Defendant is applied for the benefit of the preference shareholders, Mr. Foley and Mrs. Foley.

[5]The Third Defendant is a quarrying company, and the Fourth and Fifth Defendants are directors of the Third Defendant. The Third to Fifth Defendants have been in occupation of the quarry since about 1 April 2003. By a letter dated 16 May 2003, Wilsons, solicitors on behalf of the trustees, gave notice to the Third Defendant of the interest claimed by the Claimants in Part OS 50.

[6]On 9 June 2006, Mr. Foley gave notice of acting in person on behalf of all the Defendants. I gave permission to Mr. Foley to act for the First Defendant, having been satisfied that he was authorised to do so: a resolution of the First Defendant was provided. He is an employee of the First Defendant, and so permission was granted under CPR Pt 39.6: permission could also have been given on the basis that he was a director.

[7]However, I was unable to permit Mr. Foley to represent the Third to Fifth Defendants. They were informed about this development, but they have indicated through a letter from Burges Salmon dated 20 June 2006 that they did not wish to attend the trial and were prepared for the case to proceed without their attendance or representation.

Claimants’ freehold title

[8]Mr. Foley became the owner of the freehold of all the land at and in the vicinity of the quarry by an assent dated 4 March 1963 (2/5/142, see list of parcels at 2/5/145, and a conveyance dated 1 January 1972 (2/5/152, see reference to OS 78 and 79 at 2/51/156).

[9]By the combined effect of two Deeds dated 18 January 1983 (2/5/268) and 14 November 1989 (2/5/3 15) (“the Freezing Scheme Deeds”) Mr. Foley constituted himself a bare trustee for the then trustees of T5 of various parcels of land.

[10]Mr. Foley remained the bare trustee for the trustees of T5 of the land comprised in the Freezing Scheme Deeds until, following a request from the Claimants (3/6/629), he conveyed the freehold to the Claimants by a conveyance dated 14th January 2002 (“the 2002 Conveyance”) (2/5/375). The Claimants are now registered as proprietors of the land so conveyed (2/5/448). Part 05 50 is the “L” shaped area of land in the top left section of plan 4 attached to the conveyance of 14 January 2002 (2/5/382). The extension land is the northern section (marked “3652” and “5755”) of the block of land running from east to west in the middle of plan 4.

The First Defendant and Mr. Foley’s freehold titles

[11]Mr. Foley conveyed OS 59 to the First Defendant on 13 June 1979 (2/5/253) and he conveyed OS 58 and 78 to the First Defendant on 28 September 1980 (2/5/264). Mr. Foley retained the freehold of the remainder of Part OS 50 and of OS 51 and 52.

Freehold titles — summary

[12]Therefore the present freehold ownership of the quarry is: Claimants Part OS 50 First Defendant 05 78, 59 and 58. Mr. Foley Remainder of Part OS 50, 05 51 and 52.

RELEVANT HISTORY

[13]On 2 January 1939 the Stoke Edith Property Company (“SEPC”) was incorporated. It was an unlimited company, established by Mr. Foley’s father. He sold his interest in the Stoke Edith Estate to SEPC in return for shares. The land sold to SEPC included Part 05 50. The remaining part of the estate was held by Mr. Foley’s father as life tenant of a trust established by Mr. Foley’s grandfather.

[14]A planning permission was granted for mineral working at Perton Quany on 5 September 1951. By a permission given on 21 June 1958, the Herefordshire County Council granted permission for the development of land at Perton Quarry, Stoke Edith, Herefordshire. There had been an earlier permission granted in 1951 [2/5/120]. According to the plan attached to the permission of June 1958 [2/5/124], there is at the southern part of the land a road going from west to east: it is referred to as County Road, and I shall call it “the Road”. Immediately to the north of the Road are fields OS59, and to the east of it 0S58. To the north of 0S59 is Part OS 50, and to the north of it is OS49. Adjacent to the south east of 0S49 and the north east of Part 05 50 is the quarry. It is also adjacent to the south west of OS52. There is shown in the plan a rectangular area which marks the area of the quarry. Planning condition 1 provided that the workings should proceed in a westerly direction from the existing quarry workings in the southwestern corner or Field 0S52 and the north-east corner of Part 05 50. The workings were to proceed in an orderly manner through the area coloured pink on the plan submitted with the application, but in fact the plan which we have does not contain any colours (condition 2). There were various conditions at conditions 3-11 as to the operation of the quarry.

[15]Condition 12 provided for rights of access and read as follows:

“The existing access to the working shall be made in the following manner, that is to say-The entrance shall be formed at right angles in the County Road, the gates thereto shall be set back twenty feet from the highway boundary, and provided with fences splayed at 45 degrees on either side of the gates. The area so formed between the public highway and the splayed fences shall be constructed and paved to the reasonable satisfaction of the County Council as Highway Authority. Condition 13 then read: “The access to the north of the existing quarry working shall be retained only for use in emergencies. The access normally used to the top of the workings shall be by means of the access to the south of the extended area marked XY on the plan submitted with the application. The point at which the access XY continued meets the county road shall be improved to enable large vehicles to turn into the access without difficulty.”

Condition 13 then read:

[16]It should be noted that the point Y on the plan is at the Road and that the plan contains parallel broken lines going north (and slightly west) from Y through 0S59 to the point X which is in the south of Part OS 50. The access XY appears to correspond to the access referred to in clause 3(F) of the Lease referred to above.

[17]On 1st August 1958 SEPC and Mr. Foley’s father granted an agricultural tenancy (“the 1958 Tenancy”) over 125.158 acres on the Stoke Edith Estate known as Copgrove & Wootton Farms to Mr Williams (2/5/58). This included Part OS 50, described as “pasture” comprising 4.238 acres, and 05 59, 58 and 78 and the extension land, that is fields to the south of the road (see 2/5/137). Part OS 50 is shown on the tenancy plan as an L shaped parcel.

[18]Clause 3(A) reserved minerals to the landlord, and clause 3(d) reserved to the landlord the right at any time on giving two months notice to resume possession of and determine the tenancy in respect of any part of the farm for the purposes among other things of quarrying. The landlord did not exercise this right against Mr. Williams. By clause 3(F) (2/5/126), SEPC reserved a right of way 16 feet wide over OS59 and 50 in the approximate position shown on the plan annexed to the 1958 Tenancy. That appears at 2/5/141. The plan shows by parallel broken lines a route running north from the UC 72211 across 0S59 and terminating just inside Part OS 50. This route is similar to that contained in the 1958 Planning Permission. Mr. Foley was not involved directly in relation to the planning permission or the lease, but he said that the reservation of the right of way in the lease and the planning permission must have been related. That must be right.

[19]Mr. Foley gave evidence regarding the right of way. He said that it was not bulldozed, but that it was an indentation in the ground — the grass was marked. It was the shortest way from the Road. It was possible to use the track to go from the road to Part OS 50 and it was the shortest way. There was a gate on the road at the south of the track, and he could not remember whether there was a gate at the north of the track. He said though that it was more likely that a farmer would have gone from the barn through 05 78 to Part 05 50: there was a gate at the barn (towards the end of the hearing on 21 June 2006). In an ordnance survey plan attached to a letter of Mr. Foley dated 1 September 2004 (4/7/1145) is the same path shown as the area marked XY in the plan referred to in the planning permission. In a different part of his evidence (after the short adjournment on 22 June 2006), Mr. Foley said that by 1979, he would use the track in OS59 or the entrance from the barn, depending on which of the two was the more convenient.

[20]Mr. Foley said that the planning consent languished. Droitwich did no substantial mining work. Brain & West referred to below who became lessees in 1974 did very little work. Mr. Foley’s evidence was that he knew of no occasion when Droitwich used the route XY.

[21]On 13 December 1959, Mr. Foley’s father died. Mr. Foley in his witness statement at paragraphs 22-27 described a number of events, which it is unnecessary to set out in full, the effect of which was to transfer to Mr. Foley the estate let to Mr. Williams including the land comprising Part 05 50.

[22]By the time of the assent made on 4 November 1963, it is apparent from the identification of tenants that of Part 05 50 was let to Mr. Williams comprising the field at Copgrove and being 4.238 acres (apparently for agricultural purposes) and the other part of Part 05 50 comprising quarry and being 0.656 acres, which was clearly non agricultural, to Droitwich Construction Co. Ltd.. The assent also vested in Mr. Foley 0S58 and OS59. OS78 was conveyed to Mr. Foley by a conveyance dated 1 January 1972. By that time, Mr. Foley had acquired the freehold interest in the entire area of land over which Perton Quarry now extends.

[23]On 18 June 1973 Mr. Foley granted an agricultural tenancy (“the 1973 Tenancy”) to Stoke Edith Property Company Limited (“SEPCL”), a then recently formed company set up by Mr. Foley, of other land on the Stoke Edith estate (2/5/180). The 1973 Tenancy does not comprise any land in or near the quarry. SEPCL was formed on 20 December 1972 for agricultural purposes (2/5/167).

[24]In November 1973, the First Defendant was formed, and its principal object was to deal in land. (2/5/196). Mr. Foley was asked why the First Defendant and SEPCL had been formed. He said it was on the advice of lawyers and accountants. SEPCL was mainly for farming and the First Defendant was mainly a property company. He said that the strategy was to get value to flow down to the next generation, and to seek to avoid the taxes which had affected the family following his father’s death.

[25]By a lease dated 30th May 1974, Mr. Foley let to Mr. Brain and Mr. West 7.23 acres at Perton Quarry for a term of 25 years from 1st January 1974, which appeared to comprise Part 05 50, 51, 52 and part of 49, within an area edged red. It had been very difficult to find mining lessees. At a much earlier stage, Droitwich had been lessees, but they had not done much, and it took a long time to find other lessees. According to Mr. Foley, they were underfunded and lacked expertise.

[26]The way in which the tenancy of Messrs. Brain and West operated was as follows. The lease proceeded on the basis that the area within the area edged red and not coloured blue was in the possession of the agricultural tenant from whom possession would have to be obtained when land was required for quarrying. It follows that the land coloured blue was in the already being used for quarrying purposes. This would appear be the L shaped Part of Part OS 50. There was a mechanism in Schedule 3 whereby the tenant could, if required, quarry land not coloured blue. The lease envisaged that when that would happen, the landlord would have to pay compensation to the agricultural tenant, and the minerals tenant would then pay compensation to the landlord. This would connect with the Agricultural Holdings Act 1948 in that when land was required for quarrying, the tenancy could be brought to an end, subject to bringing the matter within Case B.

[27]Messrs. Brain and West were also a disappointment. They were small and underfunded. Their work was very limited. There were no sales of minerals. There was also a problem in that the mineral planning authority was restrictive at that time. Further, the drilling which took place in 1975 was not encouraging, because the samples revealed that the stone was not to the quality required.

[28]On 4th August 1975 Mr Williams assigned the 1958 Tenancy to SEPCL 1 (2/5/228, see too 2/5/232).

[29]By a memorandum of agreement made on 3 March 1977 between SEPCL as tenant (and signed by Mr. Foley on its behalf) and Mr. Foley as landlord (“the Memorandum”), as to which the Claimants put Mr. Foley to strict proof, it was agreed that the 1958 Tenancy be varied so that vary the 1958 Tenancy “so that the Tenant may join with the Landlord or another to strip off the top soil and overburden quarry and sell the same and sell the stone under the fields at Copgrove that fall within the Tenancy” (2/5/236). By paragraph 15 of the Defence, it was contended that the effect of the foregoing agreement was to replace the reservation of the right of the landlord alone to enter the property and quarry and remove the minerals for its own benefit with an arrangement under which the benefit of the minerals would be shared between landlord and tenant.

[30]The Claimants do not admit the existence of the 1977 Memorandum. No positive case was made, whether in the pleadings or in argument, to the effect that the document was a forgery in the sense of recent invention or otherwise. Mr. Pearce, Counsel for the Claimants, made clear that there was no allegation of forgery. I accept that the 1977 Memorandum was entered into at the time when it was dated.

[31]Mr. Foley said that it was created at the instigation of lawyers and accountants, so that income could be passed to the company SEPCL, and with a view to reducing his own liability for income tax. It remained to be seen in due course how much of the income would come to him and how much to SEPCL, depending on the applicable tax regime at the time. Mr. Foley said that the intention was to keep the arrangement as flexible as possible depending on levels of income tax and corporation tax. Mr. Foley was pressed as to what purpose there was in having such agreement in that until the percentages had been agreed, nothing had changed. Mr. Foley said that the position was left open. It was necessary to record the position by the 1977 Memorandum to have a written record. There was no further agreement for the payment of a specific sum or percentage to the company. Mr. Foley said that he did not know why there was no further agreement in writing. I conclude that this was because there was never an agreement as to anything further and in particular as to the percentage to be paid to SEPCL.

[1]The Stoke Edith Property Company (“SEPC”) and Stoke Edith Property Company Ltd (“SEPCL”) were different companies.

[32]On l3th June 1979, Mr. Foley, who until then had owned Part OS 50 and 0S59, conveyed OS59 to the First Defendant and retained Part OS 50 (2/5/253). There were expressly excepted from the conveyance “all rights easements privileges and appurtenances and other matters”.

[33]The case of the Claimants is that there was impliedly reserved out of 0S59 a right of way for the benefit of Part OS 50 along the route of XY referred to above. The basis of the implication is said to be that the planning permission had governed the operation of the quarry and in particular the rights of access thereto. It is contended that it must have been intended as between Mr. Foley and The First Defendant as the intended owner of Part OS 50 that the intended owner of Part 05 50 should have an easement to enable the quarry to be operated in accordance with the planning permission. As noted above, there was a further conveyance from Mr. Foley to the First Defendant of land including OS58 and OS79 (2/5/264).

[34]In 1979 there was a colossal landslip. Mr. Foley told the Court that the landslide was colossal comprising about one million tones of land which had moved. The land at Part 05 50 had come right forward and bringing with it other adjoining land comprising Part of 0S59 and OS51. There were also minor landslides in 1981 and 1983 consequent upon the first landslide. The effect was that Perton Quarries Limited, the sub-lessee of Messrs. Brain and West, became insolvent.

[35]One effect of the landslide according to Mr. Foley was that the vast majority of Part OS 50 disappeared. Nevertheless, there is evidence comprising field record cards showing some use of Part 05 50 for agricultural purposes until 1983 (7/5). According to Mr. Foley’s evidence, there came a time when Part OS 50 entirely ceased to be a field.

[36]Shortly after the 1979 landslip, there was the transfer of field OS59 to the First Defendant, to be followed the next year by the transfers of 0S58 and 78 also to the First Defendant, to which I have referred above. Mr. Foley explained that this occurred because these fields were intended to be in the quarry. They were conveyed because of potential for growth: the perception was that they had a value which was greater than agricultural. A further reason for the transfers was estate tax planning after taking advice. Until planning consent, it was a hope value. It must have been the case that the First Defendant was regarded as the right vehicle for receiving the fields. This was different from the plan of the 1977 Memorandum where the company to receive income was SEPCL. This is of importance in considering whether or not the 1977 Memorandum was ever implemented by any subsequent more specific agreement under which there was a sharing between SEPCL and Mr. Foley. The indicator is that by 1979-1980, the focus of receipt of money was the First Defendant and not SEPCL.

[37]By a planning permission dated 14 July 1987, pursuant to an application made in August 1984, permission was given to the southern extension of Perton Quarry to stabilize the present workings. This appears to have permitted extension into Parts of OS78, 0S59 and 0S58. Condition 14 provided that all vehicular movements into and out of the quarry should be via the established entrance at the north end of the site. No vehicles should enter or leave the site via the lanes to the south and east of the quarry.

[38]Mr. Foley said that he had to find a mineral lessee with capacity and marketing skills in order to clear up the mess from the landslides. There were a number of false starts. He then found Huntsman’s Quarries, who began to carry out work from the late 1980’s. It is to be noted that the 15 year lease to Huntsman’s dated 19 March 1990 was with effect from 1 April 1988, presumably reflecting the time of Huntsman’s being on site. Mr. Foley gave evidence about Huntsmans going on to the site with huge bulldozers and scrapers.

[39]Mr. Foley was asked when it was that Part OS 50 ceased to have agricultural use. It was not a question which Mr. Foley found easy to answer. At first, he said that part of it was used until 1982-1983. It could not have been used for livestock because of a problem of fencing and a collapsing terrain. He said that whatever part was required for silage was used. In the winter months, fertilizer was put on it and in the summer, it was cut for silage. He was again asked until when was the remainder of Part 05 50 used. He said that he could not remember. He was asked if it was used until before or after 1990, and he said that he thought that it was before 1990. In answer to a question which I then asked, Mr. Foley said that by 1990, none of Part 05 50 was being used for agricultural purposes. I accept that evidence. It is consistent with the work carried out by Huntsmans from the time when they come on to site in about 1988. I find as a fact that that Part 05 50 was used at least in part, for agricultural purposes until at least 1983, and that by 1990 it had ceased to be used for such purposes.

[40]The lease made on 19th March 1990 was between the First Defendant, Mr. Foley and Huntsmans Quarries Ltd. (“the 1990 Tenancy”) of minerals in 29.03 acres at Perton quarry for a term of 15 years from 1st April 1988 (2/5/318). It is to be noted that SEPCL was not a party to the lease. I accept the submission of the Claimants that the colouring on the plan (2/5/321) appears to be shown on 1/5/79. Part OS 50 is included in the “minerals area” (2/5/324).

[41]The lease was of Part OS 50, 51, 52, 78, 59 and 58 within the “minerals area” as defined by clause 2 (a). By clause 7(b), the First and Second Defendants covenanted (2/5/328) to “apply for and obtain any necessary consents and surrenders from tenants and occupiers of demised premises upon which the Tenant shall enter or which it shall use or occupy under the liberty in that behalf hereinbefore granted and to pay such tenants or occupiers full compensation including claims for tenant right and disturbance to which such tenants or occupiers would be entitled under the Agricultural Holdings Act 1948-1986 for any damage loss or injury whatsoever which shall be caused or occasioned by or as a result of the exercise of the said liberty and keep the Tenant fully and effectually indemnified in respect thereof’. The lease was non-assignable (Sch 2 Cl 24 (2/5/348)) and terminable on grounds of uneconomic working or exhaustion of reserves (Sch 3 Cl 4 (2/5/353)). It will be noted that SEPCL was not a party to the 1990 Tenancy. It was suggested by Mr. Foley that this was the case because it was contemplated that its assets were about to be transferred to the First Defendant, which was a party to the 1990 Tenancy.

[42]Mr. Foley said that Huntsmans did a very good job clearing up the landslide and marketing stone. They worked slowly down the land. They used adjacent land of Mr. Foley to the north and the east, in effect as dumping ground. The soil and wasted was banked up. He said that access to the south side had gone.

[43]By an Agreement dated 7th June 1990 (“the 1990 Agreement”) SEPCL agreed to sell its business to the First Defendant (2/5/355). SEPCL has since been dissolved. The business was sold including all the property assets and rights of the vendor used in the conduct of the business including the leasehold property. The leasehold property was defined as the leasehold premises owned by the vendor as list in Part 1 of Schedule 1, which listed the 1973 Tenancy, but not the 1958 Tenancy. The Defendants say that the effect of this agreement was that there was assigned to the First Defendant 1958 Tenancy which had been assigned by Mr. Williams to SEPCL in 1975. The Claimants do not admit that this was the effect, and point to the fact that at Schedule 1 to the 1990 Agreement, the leasehold property was defined by reference to the 1973 Lease and there is no reference at all to the 1958 Tenancy. In any event, the Claimants say that this was only an agreement to assign and that it did not vest property, absent an assignment by deed.

[44]It is apparent from documents of account [7/2/21 that the royalties from Huntsmans were paid to the First Defendant. The money did not go to Mr. Foley or indeed to SEPCL (bearing in mind that the first payments pre-dated the agreement under which SEPCL sold its business to the First Defendant). This is a further indicator that whatever the intention was at the time of the 1977 Memorandum, there does not appear to have been a sharing of income between Mr. Foley and SEPCL.

[45]The First Defendant and Mr. Foley claim that the 1958 Tenancy was assigned to First Defendant by the Agreement of 7 June 1990. The Claimants do not admit that it was. However, in one recent and one pending rent arbitration the Claimants have treated the First Defendant as holding certain land (including the extension land but not including Part OS 50) on the terms of the 1958 Tenancy (see 4/7/881 and 4/7/88 (first arbitration) and 5/8/1163 (second arbitration).

[46]The First Defendant and Mr. Foley further claim that the 1958 Tenancy continues to subsist in relation to Part OS 50. The Claimants contend that the 1958 Tenancy determined over Part OS 50 at or before the time when quarrying commenced on Part OS 50. The Claimants are presently unable to specify when quarrying commenced on Part OS 50: it may have been before or after the Agreement of 7 June 1990.

[47]As for the quarrying, the quarry has expanded over time. A copy of an extract from the 1929 Edition of the Ordnance Survey is at 1/3/57. It shows the quarry as “disused” and marked OS 52. Some idea of its expansion can be gathered from the planning permissions granted in 1951 (2/5/120), 1958 (2/5/121) and 1987 (2/5/312, in connection with which see the plan at 1/4/79). The quarry currently occupies all or most of Part 05 50, 51 and 52, 79, 59 and 58. A survey plan showing its extent in April 2003 is at 2/5/4 12. In May 2000 planning permission (2/5/365) was obtained to extend it further south into OS 79, 61, 60 and 61a (“the extension land”). This will only be possible after (amongst other preconditions) the road running to the south of OS 79, 59 and 58 has been diverted.

[48]T5 initiated a rent review of the land at Stoke Edith of which the First Defendant was tenant by two notices served on 28th November 1997, one in respect of each of the 1958 and 1973 Tenancies: see 4/7/813 - 816. The rent was referred to arbitration.

[49]Initially, Mr. Buxton of Burges Salmon, then the solicitor on behalf of Mr. Foley sought to clarify the extent of the holdings of which the landlord sought a rent review. Statements of Case were prepared both for the tenant and for the landlord. In the Statement of Case for the tenant, there was a plan attached which excluded Part OS 50 (4/7/875). Mr. Foley said in his evidence that the plan was for the purpose of fixing the rent of the holding, and that the value of Part OS 50 would be little or nil or value. It was suggested to him that that was not a very good reason for omitting it, to which he said that it possibly was not. When it was suggested that the real reason was that he believed that the First Defendant was not a tenant, he said that he did believe that the First Defendant was a tenant, but he did not show it. He cannot say whether or not the omission was deliberate: he could not remember exactly what was happening at that time.

[50]In the Statement of Case for the landlord, it was stated that the landlord did “not know the exact delineation of the land currently comprised within the tenancy. A plan is attached which delineates in red the land which the Landlords believe is comprised within the tenancy and, in particular, this plan excludes Part OS 50 comprising 4.238 acres.” (4/7/881). Mr. Buxton, the former solicitor of Mr. Foley, accepted in evidence that if this point had been contentious, it would have been his duty to point this out to the landlord. He did not do so: on the contrary, it was not contentious until after the award had been made. Mr. Foley said that this statement was wrong, and he cannot remember why he took no step to seek to correct this statement. He said that he was focusing his attention on the appropriate rent for the agricultural land.

[51]Mr. Buxton also reflected upon his letter dated 8 October 1999 in which he referred back to an earlier letter of his of 3 September 1999 in which he had expressed astonishment about the landlord being unclear as to the extent of the holding in respect of which they had demanded a rent review. He said that it was fundamental to adjudicate on the extent of the holding in order to decide the amount of the rent. If the Parties could not agree it, then the arbitrator would have to do so. That is why he referred to the case of Kirkby v Robinson [1965] EGD 236.

[52]On 11 November 1999, at a preliminary hearing, there was much discussion regarding the extent of the holding. There were present at the hearing Mr. Foley and Mr. Buxton for the tenant and Mr. Wiltshire of Wilsons and Mr. Denny of Berringtons (surveyors) for the landlord. This is evidenced by a note which I accept as the best evidence of what occurred, and I accept that it is substantially accurate: see 4/7/985 and following. Mr. Foley accepts that the plans before the meeting showed that Part OS 50 was not a part of the holding. When asked why he did not mention this, he said that it was because there were many other aspects to discuss, and the arbitrator was just going to set a rent. In other words, he was saying that he did not regard whether Part OS 50 was in or out as affecting the level of the rent.

[53]There was an erroneous conclusion as to the acreage of the land. There was agreement that the holding was 507.563 acres, but the next day, Wilsons for the landlord wrote stating that there had been a miscalculation and that in fact there were 611.353 acres. Draft plans were sent by Berringtons for the landlord to Mr. Buxton on behalf of Mr. Foley under cover of a letter dated 28 February 2000. On 13 April 2000, Mr. Buxton confirmed that the plans were accurate. Thereafter a schedule of acreages was produced and agreed at 602.71 acres.

[54]By a letter dated 12 November 1999 from Wilsons to Burges Salmon, it was recorded that there had been discussions “at considerable length” on the basis of which “there is no disagreement as to what is comprised within the tenancies”: 4/7/992. Mr. Buxton referred to this agreement as a provisional agreement. Mr. Buxton said that it was provisional in the sense that the agreement needed to be recorded in writing. It might have been provisional in the sense that anything might have been provisional until the award by consent: there is no indication that it was expressly provisional. On the contrary, by a letter of 1 December 1999 from Burges Salmon to Wilsons, it was stated that at the preliminary hearing it was agreed that the total acreage comprised in the rent review amounted to 507.563 acres, and “our client is not prepared to revisit this issue which has now been determined by the Arbitrator on the basis of evidence on either side at the Preliminary Hearing”: see 4/7/1004-5. This was in the context of Wilsons by this stage having contended that the true acreage was 6 11.353 acres, which led to the arbitrator stating that he would have to prepare his own schedule of acr~age: see 4/7/1007. In the same letter of Wilsons to Burges Salmon, it was stated that from the original tenancy agreements there had to be some deductions and in Particular “Os numbers 50, 59 and 78 are now part of Purton Quarry requiring a deduction of 19.9 72 acres.” As one would expect, this letter was passed on by Burges Salmon to Mr. Foley: see the letter of Burges Salmon of 19 November 1999: see 4/7/996. Mr. Foley admitted in evidence that he did not give instructions to Burges Salmon to correct this, even although on his case at least as regards Part OS 50, it was erroneous. He said that he could not remember why he did not do so.

[55]By a letter without prejudice dated 8 December 1999, it was stated that it was agreed that the rent should be £25,000 (per annum): see 4/7/1015. It is apparent that at that stage that the Parties were very close to agreement. By a letter dated 5 January 2000, various matters had been agreed, and Burges Salmon stated that Wilsons was arranging for Savills plc to produce the definitive plans and Schedule of Acreages.

[56]Plans were sent by Berringtons by a letter dated 28 February 2000 to Burges Salmon, which plans were confirmed as correct (having received confirmation from the client) by Burges Salmon by a letter dated 13 April 2000: see 4/7/1037, 1041. When asked about this, Mr. Foley said that he could not say whether he noticed at the time that Part 05 50 had been excluded. He said that he overlooked it.

[57]By a letter dated 6 June 2000 from Burges Salmon, it was agreed that the acreage of the holding totals 602.7 10 acres: 4/7/1059. By this time, it was agreed that the plan made by Berringtons would represent the agreed boundaries which would be signed and dated, but for the purpose of convenience an older plan of Savills would be attached to the award of the arbitrator: see letter of Wilsons of 15 June 2000 at 4/7/1079. Hence in the award, it was recorded that more detailed plans had been agreed between the Parties.

[58]The arbitration was concluded by an award made by consent on 14 August 2000 (“the 2000 Award”) (4/7/1118), which stated an increased rent for the holding and annexed documents containing matters incidental to the tenancy. These included an agreed plan and schedules of the holding, in neither of which is Part OS 50 included (see clause (a) and (b) at 4/7/1120, plan at 4/7/1121 and Schedule at 4/7/1126). In the system of field numbering used in that Schedule Part OS 50 would be 4476, see e.g. 4/7/1115 or 1/3/59. The Claimants further claim that any interest the First Defendant had as tenant in Part OS 50 must, if then still subsisting, have been brought to an end at latest by the 2000 Award.

[59]Mr. Foley said that in the summer of 2000, Burges Salmon agreed the form of the award. He said that the first question was the amount of the rent, which was a global sum agreed in order to avoid a contested arbitration. The second question was the plans and the schedules of acreage. There was only one set of plans which he signed.

[60]On 24 August 2000, the trustees were informed by Mr. Rupert Foley that Smiths Plant Hire was working at the quarry. By a fax of the next day, Wilsons, solicitors, gave notice to Mr. Smith of the interest of the trustees in Part OS 50. In the ensuing correspondence, Mr. Foley informed Wilsons that the Huntsmans lease had been assigned to Mr. Smith and that he considered the omission of Part 05 50 from the 2000 award to be a mistake. By a fax dated 1 September 2000 from Mr. Foley to Mr. Wiltshire of Wilsons, Mr. Foley stated as follows:

“On 4 August 1975 the tenancy held by Mr. Lewis Williams was assigned to (SEPCL). The tenancy covered O.S. 50. The First Defendant Limited took over (SEPCL). At no time has 0.5. 50 been surrendered out of the tenancy. I did not create my Settlement until 18th October 1978.”

[61]There then ensued correspondence in which the Part 05 50 issue was joined between the parties. No attempt has been made to rectify or set aside the 2000 award.

[62]There is an attendance note of Mr. Wiltshire of 13 September 2000 stating that Mr. Foley had signed and approved the plans prepared by Berringtons but they appear to have been lost in the office of either Burges Salmon or Wilsons. The note goes on to say that Mr. Buxton anticipated that Mr. Foley would say that the plan was no longer agreed. The note says “(Mr. Buxton) said that he had always been concerned that Mr. Foley would change his mind. James said that Mr. Foley was not prepared to agree to the new access way being marked on the plans for 0S83”.

[63]On 23 May 2002, the First Defendant initiated a further rent review of the land which it rented from T5. An arbitrator was appointed. The First Defendant claimed in the arbitration that Part 05 50 was comprised in the holding. By an order for directions made on 12 October 2004 the arbitrator adjourned the arbitration pending final determination together with related issues by the High Court. These proceedings were issued on 1 October 2004.

[64]During 2003, differences arose between the parties as to rights of access to Part OS 50. It will be necessary to revert in detail to the rights of way in due course in this judgment.

[65]After all of this, there was a further lease of the quarry. It was dated 2nd August 2004 and was granted by the First Defendant and Mr. Foley to the Third to Fifth Defendants (2/5/385). The Defence admits (paragraph 21, 1/1/11) that the lease comprises Part 05 50. The lease was granted after the 2000 Award and after the Claimants had been registered as proprietors of Part 05 50.

THE ISSUES TO BE TRIED

[66]The respective contentions have given rise to three issues which the Court is asked to determine, namely:(1) “Whether the Claimants are entitled to possession of Part 05 50.”

(2) “When the Claimants became entitled to possession of Part OS 50.”

(3) “Whether there is appurtenant to Part OS 50 a full right of way 16 feet in width between Part 05 50 and the road to the south of Perton Quarry via 05 59 and a full right of way between Part 05 50 and the road to the east of Perton Quarry”.

[67]As regards the third issue, this arises because the Claimants contend that there are appurtenant to Part 05 50 two legal easements, namely:(1) a full right of way sixteen feet in width between Part OS 50 and the road to the south of Perton Quarry via 05 59; and

(2) a full right of way between Part OS 50 and the road to the east of Perton Quarry.

[68]These three issues were ordered to be tried pursuant to an order made on 14 December 2005 by Deputy Master Arkush. He ordered a split trial of the issues of liability and quantum with the above issues to be determined.

THE WITNESSES

[69]Before considering each of the above issues, I make observations regarding the evidence. I heard the following evidence: For the Claimants: Mr. Pintus, a solicitor and a partner of Macfarlanes; Mr. Denny, a surveyor and formerly of Berringtons; Mr. Wiltshire, a solicitor and a partner of Wilsons; Mr. Hudson, a director of the Claimants and managing director of Saffery Champness Management International Limited of Guernsey. For the First and Second Defendants Mr. Foley Mr. Buxton, a solicitor and a partner of Burges Salmon.

[70]I shall refer to the evidence of Mr. Foley in a moment. As to the other witnesses, their evidence was in large measure bringing to life documents. This is a very heavily documented case in which there are 7 files of documents comprising well over 1,000 documents, of which there has been reference to many of them. The evidence of these witnesses was largely measured. Their evidence was cogent and it was entirely consistent with the documents.

[71]I wish to pay tribute to Mr. Foley to the way in which he acted as advocate. He was well aware of his limitations in relation to his inability to present any submissions of law. He was at all times courteous and constructive in his approach. He made light of the obvious difficulties of having to combine being advocate with being a major witness in the case.

[72]As for his evidence, he, unlike the other witnesses, had an involvement which straddled decades. He therefore was in a position to deal with relevant matters which went back to the 1950’s when the 1958 Tenancy was executed. He, unlike the other witnesses, had to deal with apparent contradictions or inconsistencies between his pleaded case and the documents.

[73]I found parts of Mr. Foley’s evidence confused. He had received advice over the years from solicitors and accountants as to the need to be involved in estate planning, especially from a fiscal perspective. That made his affairs very complex. Hence the web of companies and trusts, interrelating with ownership of the estate being split between various entities in the group, with Mr. Foley holding some land for some time as trustee or as agent for trusts and with there being the relationship of landlord and tenant between persons within the group.

[74]Mr. Foley was sometimes confused in his evidence, as he had been in some documents as to precisely who owned what and who had what rights. I formed the view that he was confused as to what was owned by the First Defendant and what by Mr. Foley and what by the trustees of T5. Hence the haphazard way in which it was discovered that Part 05 50 was owned by the trustees of T5: see 3/6/564.

[75]This in the end led to the problem of this case. There is a note of a meeting in 1998 when it was discovered that the Claimants and not Mr. Foley owned PART 05 50. This then in turn was to lead to the questions as to who, if anyone, was a tenant of the Claimants.

[76]I have referred in this judgment to several of the answers which Mr. Foley gave in evidence in particular in relation to the question as to why he did not object to the fact that in the context of the arbitration, the plans showed that Part 05 50 was excluded from the holding and on more than one occasion this point was specifically alluded to by the landlord. I have to say that I found the evidence given by Mr. Foley unconvincing, and rather smacking of someone not being able to confront reality. The reality as I find is that he did know at the time that Part 05 50 was excluded from the holding. However, in the context of the dispute immediately after the making of the Award by consent, he changed his mind, and decided that his interests were better served by Part OS 50 remaining a Part of the tenancy in favour of the First Defendant. It may be that he has convinced himself that this was a mistake which was not picked up until then. I take the view that there was no mistake at the time. He has changed his mind, but he has become so entrenched in his own cause, that he is unable to see that it was a change of mind, and not a mistake. QUESTION 1 - Whether the Claimants are entitled to possession of PART 05 50. QUESTION 2 - When the Claimants became entitled to possession of PART OS 50.

[77]The first question to be tried is whether or not the Claimants are entitled to possession of Part 05 50. The Claimants say that this is so because as regards Part 05 50, there has been a surrender of the 1958 Tenancy. The primary way in which the surrender is said to have taken place is by operation of law. It is said that when the land was required for mining operations or when the land was the subject of mining operations, the agricultural tenancy ceased, and the tenant surrendered the Part 05 50. The Defendants say that this was not the case and that there was no intention to surrender Part 05 50.

[78]I shall first consider the legal test, then review the submissions and then state my findings.

SURRENDER - THE LAW

[79]A surrender occurs where the tenant yields up his estate to the lessor. A surrender may be an express surrender or a surrender by operation of law. An express surrender of a lease not exceeding three years may by a written instrument. It is unclear whether a tenancy taking effect in possession for a term not exceeding three years can also be surrendered in writing. If it is possible for such a tenancy to be expressly surrendered, the Claimants submit that a letter from Burges Salmon dated 27 June 2000 amounts to an express surrender.

[80]If, however, the intention of the Parties as inferred from their conduct is that the lease should be yielded up, surrender results by operation of law without the necessity either of writing or a deed. This doctrine is based on the principle of estoppel.

[81]In Tarjormani v Panther Securities Ltd.

(1982) 46 P & CR 223

at 224, Peter Gibson J. stated as follows:

“The doctrine operates when the tenant is a party to a transaction that is inconsistent with the continuation of his tenancy, but in my judgment the conduct of the tenant must unequivocally amount to an acceptance that the tenancy has been terminated. There must be either relinquishment of possession and its acceptance by the landlord or other conduct consistent only with the cesser of the tenancy, and the circumstances must be such as to render it inequitable for the tenant to dispute that the tenancy has ceased.”

[82]The matter must be determined objectively. The conduct of the parties must point unequivocally to the termination of the tenancy, but their intentions are irrelevant: see Megarry & Wade 6th Ed. para. 14-174. Thus, even if one of the parties is acting under a mistake, there can be a surrender of law, provided that the mistake is not induced by the fraud of the other: see Gray v Owen

[1910] 1 KB 622

[83]The Agricultural Holdings Act 1986 does not restrict the ability of the Parties to a contract for the letting of an agricultural holding to surrender it: see Scammel & Densham, Law of Agricultural Holdings 8t~~ Ed. pp. 229-230.

[84]An example of where there is such a surrender is where the lessor grants a new lease to a third party, or accepts a third party as the new tenant, with the assent of the existing tenant.

The case ofthe Claimants

[85]It is necessary to focus on the way in which the Claimants put their case. It was as follows (see Addendum 1 to the Claimants’ Skeleton Argument para. 9):

“Cs submit that Part 05 50 was surrendered by operation of law out of the 1958 Tenancy: (1) if the freeholder of Part OS 50 with the consent of the tenant under the 1958 tenancy let a mining lessee into possession of it: failing which (2) when the trustees and The First Defendant agreed to the making of the 2000 Award.”

[86]As regards the first of the two above matters, the Amended Particulars of Claim states at para. 14 that “the Claimants will say that it (the 1958 Tenancy) determined, at the latest, when quarrying commenced on Part 05 50. The Claimants will say that the provisions of the 1958 Tenancy, including but not limited to those pleaded in paragraph 2 above (clause 3(A) and clause 3(D)), are inconsistent with the tenancy continuing over land used for quarrying, and that accordingly the 1958 Tenancy must have been determined, as regards Part 05 50, either by notice given pursuant to clause 3(D) or by express or implied surrender, when, at the latest, quarrying commenced on Part 05 50.”

[87]As regards the second of the two above matters, the Amended Particulars of Claim states at para. 17 “further or alternatively that any tenancy over Part OS 50 of which the First Defendant was the tenant was determined in respect of Part OS 50, by express or implied surrender on the making of the 2000 Award.”

[88]There is an alternative plea of estoppel in respect of the 2000 Award precluding the First Defendant from contending that it is the tenant of Part OS 50: see Amended Particular of Claim para. 18.

The case of the Defendants

[89]The Defendants admit that Part OS 50 has been quarried by a number of companies including Huntsmans Quarries: see Defence para. 19. However, they pray in aid a Deed made on 3 March 1977 between Mr. A.T. Foley and SEPCL said to vary the 1958 Tenancy and stating as follows:

“so that the Tenant may join with the Landlord or another to strip off the top soil and overburden quarry and sell the same and sell the stone under the fields at Copgrove that fall within the Tenancy.”

[90]It is said that the effect of the foregoing was to replace the reservation of the right of the landlord to enter the property and quarry and remove the minerals for its own benefit with an arrangement under which the benefit of the minerals would be shared between the landlord and the tenant: see Defence paras. 14-16.

[91]The Reply is to the effect that(a) the foregoing agreement is not admitted,

(b) the agreement was not a Deed,

(d) it was void for uncertainty: see Reply paras. 8-10.

[92]As regards the allegations relating to the 2000 Deed, the Defendants say as follows. By their Defence (1/1/11) the Defendants raise the following answers to Claimants’ case as to the effect of the 2000 Award:(1) “The rent of £25,000 was arrived at before the Parties had finally agreed what land was comprised in the tenancy, and the sum does not reflect the value of Part OS 50 one way or the other”.

(2) “In their letter to the arbitrator dated 27 June The First Defendant Limited’s solicitors submitted a plan which shows PART 05 50 is included in the tenancy”.

(3) “Following receipt of the Award the then landlords’ solicitors pointed out in a letter that the plan was erroneous in certain respects (not connected with Part 05 50) and could not be wholly relied upon”.

(4) “The first- and second-named Defendants deny that either of them has at any time made an unequivocal or any representation to any landlord of the land comprised in the 1958 Agreement that Part 05 50 has been or is excluded from it. If such a representation was made it was immediately revoked. It is also denied that any person has relied on any such representations. These Defendants therefore deny that they are estopped from asserting that Part 05 50 remains within the tenancy”.

(5) “The Claimants were not a Party to the award and are not entitled to take advantage of any estoppel”

Findings on surrender

[93]There was no instrument surrendering or giving notice to terminate the 1958 Tenancy as regards Part 05 50. However at the material times:(1) Mr. Foley was the freeholder of Part 05 50.

(2) Mr. Foley acted as land agent for the trustees of T5 (his agency was terminated on 1st October 1998 (3/6/570)).

(3) Mr. Foley was the controlling mind of SEPCL and The First Defendant.

[94]Mr. Foley’s dealings in these capacities were at times informal and not fully documented. Against such informality, the absence of an express surrender does not have as its effect that there must not have been a surrender by operation of law. On the contrary, the absence of arm’s length dealings and the informality provide a context in which I must consider whether or not there was a surrender by operation of law.

[95]I find that Part OS 50 initially became comprised in the 1958 Tenancy (2/5/125). In that lease it was described as pasture and probably was such (see 2/5/137). The 1958 Tenancy was an agricultural tenancy. As noted above, it contained the machinery under which it might be required for quarrying and might therefore cease to be used for agricultural purposes only. It contained a reservation of minerals (clause 3A, 2/5/126), a right of re-entry for quarrying (clause 3A, 2/5/126) and a covenant to use the farm for agricultural purposes only (clause 18 2/5/130). If at all times, the landlord and the tenant had been parties at arm’s length, then one would expect that the right of re-entry would have been exercised by notices being given by the landlord to the tenant. The more informal the arrangements between the landlord and the tenant, the less likely such notices would be.

[96]It is clear that at least until 1983, Part 05 50 continued to be used for agricultural purposes. This is consistent with the evidence to which I have referred above regarding how the first two mineral lessees did not fully exploit the land: see paragraph 20 above as regards Droitwich and paragraphs 25-27 above as regards Messrs. Brain and West. It is also proven by the cards containing the activities carried out on Part OS 50, at least showing that Part 05 50 continued to be used at least in part for agricultural purposes until 1983.

[97]However, on the evidence which I have heard, I am satisfied that by 1990, that had ceased to be the case. I find that by that stage, Huntsmans who had been in occupation bulldozing and preparing the area for mining since 1988 were using the area for purposes entirely at odds with the continuation of an agricultural tenancy. I accept the evidence of Mr. Foley that Part 05 50 had ceased to be used for agricultural purposes by 1990. I refer to my findings at paragraph 39 above.

[98]By this stage, the landlord was Mr. Foley and the tenant was a company controlled by Mr. Foley as director, that is to say SEPCL. The 1990 Lease made provision for the landlords, that is to say Mr. Foley and the First Defendant to procure all necessary consents and surrenders from tenants. In the context of the tenant being SEPCL, if there was still a tenancy, the closeness of the relationship between landlord and tenant made the formality of obtaining an express consent or an express surrender an unlikely step. The consent or the surrender could be implied if that was what was given.

[99]I find that it was given by Mr. Foley for all purposes including for the purpose of the companies which he controlled and directed which were affected, and particularly here for SEPCL. It is apparent that the agricultural use of Part 05 50 had ceased. It is also apparent that SEPCL ceded use of Part OS 50 to Huntsmans from before the time of the 1990 Lease. I do not attach much weight to the fact that SEPCL was not a party to the 1990 Lease because the structure was for the landlord to procure the consent or the surrender of the tenant. It was therefore envisaged that there might be tenants of the land. They would not be intermediate tenants under this structure, but parties in respect of whom the landlord had the obligation to procure a surrender or to obtain consent,

[100]I find that this was forthcoming. It was not simply a consent. It was a surrender because the purpose of the tenancy at least as regards Part 05 50 had come to an end. If SEPCL had been at arm’s length, then Mr. Foley would formally have sought to obtain such surrender. He did not have to do it expressly because of the informality of the relationship. It happened because if SEPCL had not already surrendered the tenancy insofar as it concerned Part 05 50, it did not object to the 1990 Lease. On the contrary, it permitted the 1990 Lease to take place and Huntsmans to be able to carry out its operations. Its closeness with Mr. Foley and the First Defendant was such that it did not need to give formal consent or express a surrender or be a party to the 1990 Lease.

[101]I reject the suggestion of Mr. Foley that at any time within the next few years, the land might be restored to agricultural use. This plainly was not the intention of the parties. It is to be noted that the 1990 Lease provided for a term of 15 years. Further, having seen pictures of the quarrying and having been told about the nature and extent of the landslip, it is unreal to regard this as a mere temporary interruption in the tenancy. I am satisfied that for the foreseeable future, it made an agricultural tenancy quite unworkable. It is entirely artificial to imagine that the arrangement with Huntsmans might have been a short term one under which the agricultural tenancy might have been kept alive in the expectation that it would revert at the conclusion of the short term arrangement with the land being restored to its former agricultural state.

[102]Faced with this, Mr. Foley has had to contend that the 1977 Memorandum provided for a change whereby SEPCL acquired an interest in the mining operation. Whilst as I stated in paragraph 30 above, I accept that the 1977 Memorandum was a genuine document, it was only a preliminary of something to be agreed. It allowed matters to be very flexible because its genesis was an attempt to reduce the incidence of taxation, and to channel income to Mr. Foley or to SEPCL according to the tax regime prevailing from time to time. It was in my view at highest an agreement to enter into a further agreement. The usual rule is that such an agreement is not enforceable. That, however, is not the central point. The point is that there is no evidence that whatever agreement there was, if any, was implemented. There is no evidence that royalties were paid to SEPCL. There is no evidence that SEPCL can’ied out any of the activities referred to in the 1977 Memorandum. As I found in paragraph 31 above, there was never an agreement as to anything further and in particular as to the percentage to be paid to SEPCL.

[103]The argument was that the 1977 Memorandum had as its effect that even if Part 05 50 was no longer available for agricultural purposes, the variation had an effect, namely that the tenancy could survive the letting of the land for mineral purposes due to the arrangement for the sharing of royalties. In my view, this argument must fail. The 1977 Memorandum was inchoate: if the agreement was complete, it was never performed in practice. It therefore follows that the 1958 Tenancy was not varied to have a profit sharing arrangement between landlord and tenant or assignee as regards the mining operations. Thus, no such arrangement to stand in the way of a surrender by operation of law.

[104]Mr. Foley said that there was no evidence of the rent being adjusted to take into account any surrender. In my view, this is not significant in that the rent which was paid the rent was paid as between associated persons in circumstances where the essence was tax avoidance. So long as that which was being paid was within a correct ballpark so that the transaction could not be challenged as being a sham, the exact amount being paid did not matter as between the parties. It came to matter when it was discovered that the true landlord was T5 and when the fall out within the family was such as to create the relationship of Parties very much at arm’s length.

[105]I also take into account various indicators after 1990 to the effect that the 1958 Lease was not considered as being in effect. This provides some evidence of the pre-existing surrender, although I should add that I have given this less weight than the matters set out above or the agreement made in 1999-2000 leading to the award, because it is necessary for any surrender to be unequivocal and not something which can be picked up by inferences from disparate points of evidence. Nonetheless, the points broadly giving rise to supportive evidence of pre-existing surrender are as follows:(1) The absence of reference to the 1958 Tenancy in distinction to the 1973 Tenancy in the agreement for the purchase of assets of SEPCL by the First Defendant in June 1990: see 2/5/355 at 357, 361. It is still possible that the 1958 Tenancy was comprised in the general words of clause 2.1.3 of the 1990 Agreement, but it is nonetheless significant that the 1958 Tenancy was not called to mind when the 1990 Agreement was made.

(2) The absence of reference to the 1958 Tenancy in a rent review memorandum dated 1995 (2/5/363). This appears to deal with all the rent payable by the First Defendant.

(3) The absence of reference to the 1958 Tenancy in the statement of case of the tenant in the arbitration, despite its being mentioned in the statement of case of the landlord: see 4/7/813 — 816 and 4/7/869 at 870. These points cumulatively provide evidence that Mr. Foley did not believe that the 1958 Tenancy was still in force, which is of some, albeit limited, evidential significance in relation to the question as to whether or not there had been a surrender by operation of law.

[106]I should add that the opening in this case also pointed to numerous communications which tended to indicate a belief on the part of Mr. Foley that the First Defendant owned Part 05 50 which was inconsistent with the contention that it was a tenant, and communications in which it would have been expected that the 1958 Tenancy might have been mentioned. I prefer to rest my judgment on the matters to which I have referred above, albeit that they provide some very limited evidence of the fact that at the time Mr. Foley did not consider that the 1958 Lease was in existence at least as regards Part OS 50.

[107]I have therefore come to the view that the surrender occurred by the time of the 1990 Lease. By that stage, Part OS 50 had ceased to be used for agricultural purposes and the quarrying by Huntsmans was well under way.

[108]I should say that I have looked for unequivocal acts of the tenant. Thus, I have not regarded as crucial by itself the absence of reference to the tenancy of Part OS 50 in communications when there might have been an expectation that Mr. Foley would have referred to the same. This might be some evidence of the position. However, I have come to the view that Mr. Foley and the companies which he controlled, and most particularly SEPCL, must have permitted Part 05 50 to be used for mining purposes by Huntsmans. The permission brought to an end for any continuing use of the land for agricultural purposes for many years, bearing in mind the nature of the lease to Huntsmans. This was completely inconsistent with the continuation of an agricultural tenancy in favour of SEPCL or its assigns. In my judgment, the nature of this arrangement was such as to give rise to a surrender by operation of law. In my view, that conduct was consistent only with the cesser of the agricultural tenancy (if indeed there had not been a prior surrender by operation of law) in circumstances where it was inequitable for the tenant to dispute that the tenancy has ceased.

[109]What then is one to make about the agreement in the context of the arbitration that Part 05 50 was outside the holding? In my judgment, the many communications culminating in the 2000 Award under which it was accepted that Part OS 50 was outside the holding were evidence of a pre-existing surrender. In my view, this was not a mistaken construction, but a recognition that for years it had fallen outside the holding. I have no doubt that this was accepted by Mr. Foley at the time who was consulted throughout by Mr. Buxton. Further, he was advised throughout and he accepted the position.

[110]If I were wrong about the existence of a surrender by operation of law prior to these communications, I find that the agreement in the context of the arbitration to Part OS 50 being outside the holding amounted to a surrender by operation of law. The agreement as to the extent of the holding was fundamental to the arbitration, because of the essence of the review of the rent is the extent of the holding. Hence, the parties determined at the time and as part and parcel of the review of the rent an examination of the extent and the precise location of the holding. The agreement occurred following exhaustive consideration by Mr. Foley on behalf of the First Defendant and solicitors (Burges Salmon) and by the trustees of T5 and their solicitors (Wilsons) and agents (Berringtons); see 4/7/passim. At no stage in those negotiations did either side produce any plan or schedule of acreages showing Part OS 50 as being comprised in the holding. On two occasions the trustees specifically drew to The First Defendant’s attention that Part 05 50 was excluded (see the final sentence of para 1 of the trustees’ statement of case re the 1958 Tenancy at 4/7/881, referred to at paragraph 50 above, and the fax dated 12th November 1999 from Wilsons to Burges Salmon at 4/7/992, referred to at paragraph 54 above).

[111]I am satisfied from the correspondence that the extent of the holding and in particular the fact that Part 05 50 was treated as outside the holding was considered repeatedly both by Mr. Foley and Burges Salmon. I am satisfied that specific instructions were taken by Burges Salmon from Mr. Foley and that he gave specific instructions such that he knew, understood and consented to the 2000 Award on the basis that Part OS 50 was outside the holding. By agreeing unequivocally that Part OS 50 was outside the scope of the holding as well as other fields originally within the holding, I am of the view that if there had not previously been a surrender by operation of law of Part OS 50, one then took place. What happened after the 2000 Award was not the revelation of a mistake, but a change of mind on the part of Mr. Foley. It was by then too late to change his position. The surrender had taken place long before, alternatively it had taken place in the negotiations leading to the arbitration, and at latest by agreement of the consent order in about late June 2000 or at very laterst by the 2000 Award of 14 August 2000.

ISSUE ESTOPPEL

[112]There is another legal answer to this aspect of the case. That is that the arbitration gave rise to an issue estoppel. The particular estoppel alleged is that the award identifies the agreed plans from which it can be seen that Part OS 50 is outside the holding. It is said therefore that it is not available to the Defendants in this case to contend that Part OS 50 is within the holding.

[113]The principles of law are as follows.(1) Issue estoppel applies to arbitration as it does to litigation: see Fidelitas Shipping Co. Ltd .v C/O Exportchleb

[1966] QB 630

, 643;

(2) There may be an issue estoppel even where the award or order is made by consent: see Haisbury’s Laws of England ~ Ed. 2003 reissue Vol. 16(2) para. 968;

(3) The parties having chosen the tribunal to determine the disputes between them are bound by the determination by that tribunal of any issue which is relevant to the determination of any dispute referred to that tribunal: see Fidelitas cited above;

(4) Unless otherwise agreed between the Parties, an award made by an arbitral tribunal pursuant to an arbitration agreement is final and binding both on the Parties and on their privies including any persons claiming through or under them: see Arbitration Act s. 5 8(1) and Halsbury’s Laws of England above cited atpara. 991, 999.

(5) Although the arbitrator’s jurisdiction is limited to determination of rent, all relevant ancillary matters which must be determined before rent can be assessed must first be determined including the extent of the holding and the terms of the tenancy. Such matters do not fall outside his jurisdiction even though his jurisdiction will be limited to the terms of his appointment to be the determination of rent: see Kirky v Robinson [1965] EGD 236 and Scammel and Densham’s Law of Agricultural Holdings 8t~l Ed. p. 108.

[114]Applying these principles to the instant case, I find that there was a determination by consent as to the extent of the holding. That was that the holding did not include Part 05 50. I say that by reason of the plan exhibited to the award and by reference to the plan which the Parties agreed referred to in the award. Whatever the whereabouts of the signatures to that plan, I am satisfied that it was agreed and that it excluded Part 05 50. In my judgment, the holding was plainly relevant to the determination of rent: it was necessary to determine it in order to arrive at the appropriate rent. The parties to the arbitration were the trustees of T5 and the First Defendant. Although the trustees of T5 were not parties to the arbitration, I am satisfied that the Claimants are their successors in title, and are to be treated as if a Party to the original award.

Answers in Defence regarding the effect of the 2000 Award

[115]I now refer to the matters raised by the Defendants in the Defence (1/1/11) to the case of the Claimants as to the effect of the 2000 Award: (1) “The rent of £25,000 was arrived at before the Parties had finally agreed what land was comprised in the tenancy, and the sum does not reflect the value of Part 05 50 one way or the other”. (a) There are two answers to this point. First, the extent of the holding was agreed at a preliminary hearing on ~ November 1999 (4/7985), albeit that after that hearing Cs realised that the acreage then agreed was incorrect. The rent of £25,000 was agreed on or about 8th December 1999 (4/7/1015). Secondly, both the agreement as to the holding and the agreement as to acreage were provisional in that the intention of the parties was that there should be one agreement to be the subject of a consent order. On that basis, the agreement as to the holding and the agreement as to rent were made simultaneously in the summer of 2000. (2). “In their letter to the arbitrator dated 27 June the First Defendant’s solicitors submitted a plan which shows Part OS 50 is included in the tenancy”. The letter referred to is at (4/7/1097). This letter recorded the agreement of the parties to the making of the award in the form in which it was thereafter made (with formal additions made by the arbitrator as requested). It is not correct that Burges Salmon submitted to the arbitrator a plan which showed Part OS 50 as included within the tenancy. I have referred above also to the plans sent by Berringtons referred to in the award and approved by Burges Salmon which did not show Part 05 50 as comprised in the holding. (3). “Following receipt of the Award the then landlords’ solicitors pointed out in a letter that the plan was erroneous in certain respects (not connected with PART 05 50) and could not be wholly relied upon”. The letter referred to is presumably that dated 22 August 2000 (4/7/1132). Following the making of the award both Parties are bound by its terms unless (a) they both agree to a variation thereof or (b) the award is corrected by the arbitrator or set aside or varied by the court (Agricultural Holdings Act 1986 Sch 11 par 20, 27, 28). In relation to Part 05 50, none of these events has occurred. It is not to the point that shortly after the Award had been made that the Second Defendant said that he believed that Part 05 50 was outside the holding. There has been no application to set aside the award, and it is not apparent on what basis any such application could have been made in any event. (4). “The first- and second-named Defendants deny that either of them has at any time made an unequivocal or any representation to any landlord of the land comprised in the 1958 Agreement that Part OS 50 has been or is excluded from it. If such a representation was made it was immediately revoked. It is also denied that any person has relied on any such representations. These Defendants therefore deny that they are estopped from asserting that Part 05 50 remains within the tenancy”. There was a clear and unequivocal representation made by the first two named Defendants to the trustees of T5 that Part 05 50 was not comprised in the holding by the communications set out above including the letter from Burges Salmon dated 13 April 2000 (4/7/1041) approving the plans produced by Berringtons, the letter from Burges Salmon dated 6 June 2000 (4/7/1059) approving the Schedule of Acreages produced by Berringtons and the above mentioned letter from Burges Salmon dated 27 June 2000 (4/7/1097). (5). “The Claimants were not a Party to the award and are not entitled to take advantage of any estoppel” The Claimants were successors in title to the persons named as landlord in the award and “persons claiming under them” within the meaning of Agricultural Holdings Act 1986 Sch 11 par 19.

Conclusions on Questions 1 and 2

[116]I therefore find that(1) there was an implied surrender of the 1958 Lease. This occurred by not later than the 1990 Lease by which time the agricultural use of Part OS 50 had ceased, the quarrying of the entirety of that area had commenced, and the 1990 Lease involving long term use of the land with the necessity for consents or surrenders to be procured by the tenant had been entered into, It was intended that, as Part 05 50 was required for the quarry, any agricultural tenancy of it would be brought to an end. The proper inference to be drawn is that this intention was carried into effect by an informal surrender by operation of law;

(2) I have concluded that the subsequent agreement as to the holding in 1999-2000 in the course of the arbitration was evidence of the prior surrender by operation of law. If I were wrong, and there had not been not a surrender of the 1958 Lease prior to that time, it occurred by not later than the agreement of the Parties in the summer of 2000 leading to the making of the Award in August 2000. The agreement was clearly that from that point onwards the rent would be fixed at £25,000 and the holding would exclude Part OS 50;

(3) In any event, I conclude that an estoppel arises which binds the Parties to the Award and their privies including those claiming title thereunder. The effect is to preclude the Defendants from running a case which challenges the finding in the Award that the holding did not include Part 05 50. I find that the award is also binding on the Third to Fifth Defendants being persons deriving any right of occupation of Part 05 50 from the first two named Defendants, and in Particular from the First Defendant who was a Party to the arbitration, and who claims to be the tenant of Part 05 50.

[117]It follows that I answer the first two issues as defined in the order of Deputy Master Arkush as follows:a. Issue 1 - in view of the matters set out in the preceding paragraph, I conclude that the Claimants did become entitled to possession and/or that the Defendants are estopped from denying that the Claimants are entitled to possession of PART 05 50

b. Issue 2 - I conclude that the Claimants became entitled to possession of PART 05 50 by not later than the time of the 1990 Lease, namely 19th March 1990. If I am wrong, I conclude that it was by no later than June 1990 when the arbitration was agreed between the Parties: alternatively by no later than the date of the award, namely 14th August 2000.

[118]For the purpose of completeness, I express no view as to whether the letter of 27 June 2000 gave rise to an express surrender. That would involve not only having to construe whether or not that letter was sufficiently clear to amount to an express surrender, but to decide whether a document short of a Deed could amount to such a surrender. Clarification of the law on the latter point would be useful, but it is unnecessary in the light of my conclusions above for me to express any view on that very subsidiary part of the case of the Claimants. QUESTION 3 - “Whether there is appurtenant to Part 05 50 a full right of way 16 feet in width between Part OS 50 and the road to the south of Perton Quarry via OS 59 and a full right of way between Part 05 50 and the road to the east of Perton Quarry”. RIGHT OF WAY BETWEEN PART 0S50 AND THE ROAD

[119]The first part of the question concerns the path to which I have referred above marked XY.

Principles

[120]The following propositions of law are relevant to issue (3) which I derive from paragraph 48 of the opening skeleton argument of Mr. Pearce, and which I adopt:(1) Where the common owner of two parcels conveys one away, there may be implied into the conveyance a reservation of easements for the benefit of the land retained, if to do so is necessary to give effect to the common intention of the parties to the conveyance. The burden on a party asserting an implied reservation is a heavy one: see Megarry & Wade, op cit. 6th ed. para. 8-100.

(2) Where the common owner of two parcels conveys one away, there will be implied into the conveyance a grant of easements necessary to give effect to the common intention of the parties: see Megarry & Wade 6th Ed. para. 18~12.

(3) Under the rule in Wheeldon v Burrows

(1879) 12 Ch D 31

, where the common owner of two parcels conveys one away, there will be implied into the conveyance a grant of easements corresponding to any quasi-easements over the land retained which were (a) continuous and apparent, (b) necessary for the reasonable enjoyment of the land granted and (c) had been, and were at the time of the grant, used by the grantor for the benefit of the land conveyed.

(4) By virtue of section 62 (1) of the Law of Property Act 1925 a conveyance of land is deemed to include and operates to convey “all liberties, privileges, easements, rights and advantages whatsoever, appertaining or reputed to appertain to the land, or any part, thereof, or, at the time of conveyance, demised, occupied or enjoyed with, or reputed or known as part and parcel of or appurtenant to the land or any part thereof’. Save where the right claimed is continuous and apparent, there must be diversity of ownership or occupation prior to the conveyance for section 62 (1) to apply: see Long v Gowlett

[1923] 2 Ch 177

; Sovmots Investments Ltd v S ofS forthe Environment

[1979] AC 144

at 169, 176.

(5) When the common owner of two parcels conveys one away, there will be implied into the conveyance a grant of a right of way over the land retained, if the grantee would otherwise have no means of access to the land granted: see Megarry & Wade, op cit, 6th ed. 18-098, 18-102.

[121]The Claimants contend that a right of way between OS 50 and the lane to the south of the quarry was impliedly reserved out of the conveyance of 05 59 to the First Defendant dated 13th June 1979 (2/5/253). They do so on the basis of their contention that there was a common intention of the parties that 0S59 should be used as a mode of access from the road to the south to OS5O.

[122]As noted above, the existence of a means of access to OS 50 by a track over OS 59 is indicated by the 1958 Planning Permission (2/5/121-124) and the 1958 Tenancy (2/5/125 at 126, 141). Furthermore vehicular access to the quarry via the lane to the south was prohibited by condition 14 of the 1984 Planning Permission (2/5/313), which suggests that there was something to prohibit.

[123]The oral evidence of Mr. Foley was as follows. He acknowledged that there had been a gate adjacent to the road at the south of the path marked XY. The gates had been removed as part of a package agreed with the local authority in about 2001-2002. It was decided that planning permission should be sought for access to the south south east corner of 0S59 next to the Copgrove farm house. He said that as regards the path XY, there had been a gate at the southern end of the path continuously until that removal. He also said that for most of the time it was possible to access Part OS 50 from the southerly road along the path marked XY. One could go down the haulroad by foot. One might be able to get a tractor down there. A bulldozer could be used. It was often possible to traverse the quarry from Part 05 50 to the gate by some means or another, even if the lie of the land was rather dynamic. In the light of this evidence, I reject the evidence of Mr. Foley given in his witness statement to the effect that it was not possible to access 0S50 from the south over Part 59 both before and after the landslide.

[124]An implied reservation is very different from an implied grant, and the burden of proving an intended reservation of an easement is very heavy one. In this case, I find that the common intention to have such a reservation has been proven. I find that when Mr. Foley conveyed 0S59 to the First Defendant in 1979, he must be taken to have reserved to himself a right to use the land conveyed away for the purpose of obtaining access to Part 05 50.

[125]The circumstances are very unusual, but they comprise the following matters, namely(1) The use of this access from the road to Part 0S50 was provided in the planning permission, and the permission was on the basis that access was to be used normally from the south along the path. This was the operative permission when Mr. Foley conveyed 0S59 to the First Defendant in 1979, and for the permission to be exercised, it was envisaged by all concern that the access from the south road along the path XY over 0S59 would be used as the point of access from the south. Since mining was actively being contemplated, if not undertaken in 1979, it must have been the case that Mr. Foley would be able to retain for himself the ability to carry out the mining on the basis of the permission which had been given;

(2) It is also telling that what appears to be the same access was specifically reserved as a right of way to the landlord in the 1958 lease, I accept that this must have been related to the planning permission, as Mr. Foley surmised in his evidence.

(3) Such access was used continuously until and after 1979;

(4) It was the most direct form of access from the road to the south;

(5) The access was clearly indicated by physical markings such as the gate at the south road and by a worn track on which the path went.

[126]In these circumstances, the ability to exploit the planning permission must have been contemplated at the time of the 1979 Conveyance. It must have been more than contemplated: it must have been intended between the parties that Mr. Foley would be able to exercise the mining rights in a manner consistent with the planning permission which required the access to be mainly from the south road. It must have been intended that the 1979 conveyance would not have brought to an end the ability to do so by the use of 0S59 as a point of access along the path XY for the benefit of the land at Part 0S50.

[127]In addition to the foregoing, there is a further powerful point which indicates that the absence of reference to such easement in the 1979 Conveyance is immaterial. The sale of Part 59 to a company controlled by Mr. Foley did not alter anything very substantially. The intention of Mr. Foley and that of the company in the transaction would have been the same in that Mr. Foley owned and controlled the company.

[128]The reason why generally, there is no implied reservation is because one would expect a vendor in such a situation to provide expressly such a right. Where parties are at arm’s length, they can be expected to negotiate and set out all the relevant terms including expressly stating which easements are to be reserved. However, this is a very unusual case because the 1979 conveyance was to a company owned and controlled by Mr. Foley. In those circumstances, it is hardly surprising that the question as to what was being reserved was not spelt out between the parties. This case is therefore entirely different from those where the failure to express the reservation. It is most likely that absent arm’s length negotiation between parties separate in law, but in fact very closely connected, that there was not the usual negotiation and setting out of all relevant terms which would be the case between parties at arm’s length. Therefore, this is an unusual case where the absence of an express reservation of right is not as significant as would be in another case.

[129]In all the circumstances, I have come to the conclusion that the parties, that is to say Mr. Foley and his company the First Defendant did indeed have the common intention at the time of the 1979 Conveyance that there should be reserved the right to use Part 59 for the purpose of access between the road to the south and Part 0S50. Bearing in mind the closeness of the association between the Claimant and the First Defendant, and their commonality of mind, it is to be inferred in all the circumstances of this case that they had a common intention that the right of way should be reserved in the manner contended for by the Claimants.

[130]Mr. Foley appears to contend that if there ever was a right of way as above, that this was extinguished by the quarrying operations. I cannot accept this proposition. First, at the time of the acquisition of the right, any quarrying operations were not so substantial as to have this effect. The evidence of Mr. Foley is that at that time the right of way was used. Secondly, the evidence is that thereafter, for all or most of the time, he has been able to use the point of access of the gate from the southerly road in the evidence to which I have drawn attention immediately above.

[131]If I had found that the quarrying operations had brought to a permanent end the right of way, I would then have had to find whether as a matter of law this led to an extinction of the easement. Whether or not an easement can be extinguished and in what circumstances it would arise would raise difficult questions of law, which were not discussed before me: see Huckvale v Aegean Hotels Ltd.

(1989) 58 P & CR 163

. Since I have found that there was no extinguishment, this issue does not arise for my adjudication.

[132]I, therefore find that there is there is appurtenant to Part 05 50 a full right of way 16 feet in width between Part 05 50 and the road to the south of Perton Quarry via OS 59.

RIGHT OF WAY BETWEEN PART 0S50 AND THE ROAD TO THE EAST OF THE QUARRY

[133]Further, the Claimants contend that the 2002 Conveyance (2/5/375) impliedly granted the Claimants a full right of way between 05 50 and the lane to the east of the quarry over 05 51 and 05 52, both of which are owned by Mr. Foley, by virtue of the application of one or more of propositions of law about easements set out in sub-paragraphs (2) to (5) above.

[134]The evidence is that the main entrance to the quarry was shown off the top corner in the plan at 3/695. Access would be by a wheeled vehicle. The precise manner of access, according to Mr. Foley’s oral evidence, would vary according to the nature of the operations. Most of the time, the exact route would depend upon the nature of the operations. As a matter of health and safety, the driver would report to the office. Common prudence would indicate the route to take.

[135]In Mr. Foley’s written statement (paras. 77-79), he said, albeit in the passage regarding the absence of use of the path XY (which evidence I have rejected) that the only access to Part 05 50 which had been required by the mining lessees was through the main quarry entrance. They always accessed it through this entrance.

[136]Mr. Foley has simply denied in his witness statement at paragraph 79 that there was an implied easement.

[137]In his oral evidence, Mr. Foley stated that at the date of the plan at 3/695, which was 1999, it would have been possible to travel by a wheeled vehicle from the main entrance, off the top right hand of corner of the plan, to Part OS 50. Nevertheless, trucks and crushers and conveyors could come in from the north side and past offices and down to 05 50. Asked whether it would have been obvious at that stage which way to go, Mr. Foley said that that was not really the case. He referred to what a dangerous place it was in view of the presence of crushed rocks of different sizes. Most of the time, access could be gained to OS 50. The exact route would depend on the operations at the quarry. Common prudence would indicate the way to go.

[138]I am satisfied from the evidence that there must have been a common intention at the time of the 2002 Conveyance that access through the existing routes should continue. It follows from my conclusions regards the access to the south that access from the main quarry entrance was not an easement of necessity of the kind referred to in principle (5) above. However, I find that the common intention of the parties at the time of the 2002 Conveyance was to retain access through the existing routes.

[139]Mr. Pearce, at the invitation of the Court, presented arguments which Mr. Foley might have been able to present if he had been represented. As I have paid tribute to Mr. Foley for his presentation of the case, the Court is also grateful to Mr. Pearce for the way in which he discharged his duties. He said that Mr. Foley might have contended that any quasi-easements over the land retained was not continuous and apparent. The law in this regard is set out in Megarry & Wade 6th Ed. at para. 18-105. I take into account the entirety of the written and the oral evidence of Mr. Foley, but especially the fact that access was available at most times from the main entrance and the fact that common prudence would have indicated the way to go as showing that there must have been a continuous route and an apparent route. It does not seem to me to detract from or affect that submission that the presence of rocks or the like would mean that the vehicles would adjust the precise route. The principle was to get from the main entrance to Part OS 50. I do not accept that the need to avoid temporary obstacles or even changes in the precise topography caused by mining led to the right of way being other than substantially the same one or anything other than continuous and apparent.

[140]I find also that quasi-easement was necessary for the reasonable enjoyment of the land granted. The touchstone is not the same as that required for an easement of necessity, that is something without which the property cannot be used at all. It suffices, and it is the case, that access from the main entrance is necessary for the reasonable enjoyment of Part 05 50, bearing in mind that this was an important mode of vehicular access to Part 05 50.

[141]Mr. Pearce stated that the Defendants might seek to contend that the principles in paragraphs 119(2) and 119(3) above must be satisfied not simply by reference to 2002, but also to 1989, when the topography of the quarry was different from what it was in 2002. I accept the answer of Mr. Pearce, namely that this is incorrect since those principles are concerned with the construction of a grant made by the 2002 Conveyance. The rights of the parties under the Freezing Scheme Deeds merged in the 2002 Conveyance, and prima facie the antecedent obligations pursuant to which the 2002 Conveyance was made are irrelevant to its construction.

[142]In my judgment, the propositions of law in paragraphs 119(2) and 119(3) above are satisfied as regards the access from the main entrance. For both or either of these reasons, I am satisfied that the Claimants have proven that appurtenant to Part 05 50 is a full right of way between Part 05 50 and the road to the east of Perton Quarry.

[143]By a note dated 27 June 2006, Mr. Pearce made written submissions to the effect that there is a further or alternative basis for implying an easement under section 62 of the Law of Property Act 1925, and particularly to the question as to whether for that purpose it suffices that there was diversity of beneficial, but not legal ownership at the date of the 2002 Conveyance. This raises a question of law, which it is unnecessary for the Court to decide in view of the bases upon which it has found for the Claimants.

[144]For the reasons set out above, the preliminary issues are decided in favour of the Claimants.