Volta Developments Ltd & Anor v Waltham Forest Friendly Society [2008] EWHC 1295 (Ch)

HC 07 C 01923

[2008] EWHC 1295 (Ch)

Date 20 March 2008

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION

Before

MR P CHAISTY QC

sitting as a DEPUTY JUDGE OF THE HIGH COURT

B E T W E E N :

Between

VOLTA DEVELOPMENTS LIMITEDClaimant

NABIGANJ INVESTMENT COMPANY LIMITEDClaimant

WALTHAM FOREST FRIENDLY SOCIETYDefendant

Mr Nicholas Isaac for Claimants

Mr Thomas Braithwaite for Defendant

JUDGMENT

By this claim two points are raised for determination:

[2]It is necessary to set out in some detail the background and recent history to the land in question. Little of what I describe is in dispute. The First Claimant owns 261 East India Dock Road, London, E14 and the Second Claimant owns the adjoining properties at 263 and 265 East India Dock Road. To the rear of these properties is an open area of land which is itself adjacent to a disused Public House known as the Sir John Franklin. It was once used as the car park to that Public House. It occupies the site of 36 - 40 and part of 42 Follett Street, London, E14. It is now owned by the Defendant. In short, the principal question is what rights of access do each of the 3 properties enjoy over that piece of land.

[3]It is also necessary to describe the position as existed in the early 1960s. By that time, London County Council had acquired a number of properties in the area generally as part of the “Blackwall Tunnel Duplication” project, using powers conferred by the London County Council (Tunnel and Improvements) Act 1938. Well before the 1960s it is clear, from various plans which have been produced, that the properties on East India Dock Road and Follett Street were terraced and backed on to each other with no rights of way existing from Follett Street to the rear of the properties fronting East India Dock Road. It is also clear, again from plans produced, that prior to the 1960s there had been some clearance to part of the general area, possibly by reason of bomb damage during the Second World War.

[4]By 1961 the Council had acquired and owned the land at 36, 38, 40 and 42 Follett Street. On 11 July 1961 it agreed to sell some of its land to a Mr and Mrs Cardosi (at that time Mr and Mrs Cardosi owned 269 East India Dock Road and 44 and 46 Follett Street). The Council reserved over part of number 42 a right of way. A copy of this Agreement is not available and it is necessary to refer to an Agreement dated 12 July 1961 in order to ascertain its existence and terms. Nevertheless, it has not been disputed that such Agreement did exist. It is clear from the plans attached to the Agreements which are before me that the width of the land over which the rights were reserved in favour of the Council was 12ft. I have referred to an Agreement dated 12 July 1961. This Agreement was made between Mr and Mrs Cardosi and Mann Crossman & Paulin Limited (“ M & P” ). By it Mr and Mrs Cardosi agreed to sell all of their land, that is to say 269 East India Dock Road and 44 and 46 Follett Street as well as that part of number 42 which they had agreed to buy from the Council. The Agreement expressly referred to a reservation in favour of the Council over that part of 42 Follett Street which is shown on the plan attached to it and as measuring 12ft in width. The Agreement exception and reservation was in part described in these terms:

“to the London County Council … in fee simple or other the owner or owners for the time being of the lands adjoining the western and southern boundaries”

. It would seem fairly self-evident that the land to the West was 36 - 40 Follett Street and the remaining part of number 42 which had been retained by the Council. The land to the south is not defined and is not so obviously self-evident.

[5]On 26 October 1961 the Council effected a transfer to M & P of the land which it had originally agreed to sell to Mr and Mrs Cardosi by the Agreement dated 11 July 1961. Whilst not available, it would seem from the documentation, and is not disputed, that Mr and Mrs Cardosi effected a transfer of their land to M & P in order to carry out their obligations under the Agreement of 12 July 1961 . I should add that M & P is the Brewery which constructed the Public House. The transfer by the Council to M & P reserved a right of way over land measuring 12ft in width in the terms which I have already described.

[6]On 16 December 1963 a land swap was effected by the Council and the Company, the Council acting by its powers under the 1938 Act. The Company acquired 36, 38, 40 and the relevant part of 42 Follett Street from the Council, the purpose being to construct a car park, and the Council acquired from the Company the front part of 269 East India Dock Road and some neighbouring land. The right of way which had been reserved in favour of the Council was extinguished and a new right of way was granted. It is this which is the subject of these proceedings. The first schedule of the transfer dated 15 August 1963 referred to 36 - 40 and the relevant part of 42 Follett Street and provided: “excepting and reserving to the Council in fee simple and its successors in title the owner or owners for the time being of the lands to the south of the said land the full right and liberty … from time to time and at all times hereafter and for all purposes to pass and repass with or without vehicles from and to the lands to the south to and from Follett Street over part of the said land such part to be a strip of land not more than twelve feet in width on so much of the said land as is not built upon”.

[7]At one stage it appeared to be contended on behalf of the Claimants that 261 - 265 East India Dock Road, which of course lay to the south of the relevant land, were not owned by the Council at the relevant time in 1963. If this had been the position there may well have been significant problems facing the Claimants in seeking to rely on any express rights. This point was not pursued and it is common ground that as at 15 August 1963 the Council did own 261 - 265 East India Dock Road and that those properties were indeed to the south of the land then transferred by the Council to Mann Crossman & Paulin Limited.

[8]It is necessary to refer to some further relevant factors and features of the general area of the land in question:(i) As I have already mentioned, and this is not in dispute, prior to any of the relevant dates properties on Follett Street and East India Dock Road were all terraced properties which backed directly on to one another;

(ii) On the plan attached to the Agreement of 12 July 1961 various lines are drawn, including one across part of 269 East India Dock Road and adjacent land, with the words “proposed widening line” added. Whilst not complete, the relevant line seems to continue across and over 267. At number 269 the East India Dock Road forms a junction with St Leonard’s Road and it is not difficult to envisage that what was contemplated was some form of road widening scheme to provide a safer and more efficient junction;

(iii) I have already commented on the reservations over part of 42 Follett Street as relating to land 12ft in width;

(iv) The plan attached to the 1963 transfer without including explanatory words includes the lines drawn on the earlier plan ie. across 269 and on to 267;

(v) Planning permission was granted for the erection of the Public House in 1962. Various conditions were attached, one of which related to the provision of a car park. The relevant condition, condition 4, referred to “drawings”. I have been shown a large drawing which formed part of that relevant permission. On this drawing is marked 269 - 265 East India Dock Road and on it a line is drawn across these three properties some distance from the front which is described as a “widening line”. At the rear of these three properties, where they meet what is to be the car park and in an area which seems to cut across 265 and 263, are two inward pointing arrows and the words “possible future right of way”. I am told by Mr Braithwaite, and the point is not disputed, that the drawing is to scale and the distance between the points so marked is 12ft. As shown on this drawing what is clearly contemplated is a single point of entry to the rear of the properties fronting East India Dock Road;

(vi) The 1963 transfer makes express reference to planning permission and in the second part of the Second Schedule at paragraph (1) it refers to the Public House and car park and “all necessary planning consents”;

(vii) The role of the Council in respect of acquiring and transferring and swapping land would seem naturally to have been all part of the steps taken primarily in connection with the Blackwall Tunnel project. The Dispute

[9]It is against this background that the dispute arises. In June 2007 the Defendant, having purchased the Car Park, the site of 36 - 42 Follett Street, erected posts and hoardings which restricted the line of access from Follett Street to the rear only of 265 East India Dock Road, blocking off direct access to 261 and 263. Until that time access was freely gained across the whole of the Car Park to the rear of each of the three properties directly and separately. Interim injunctive relief was granted in July in favour of the Claimants and continued, with a cross undertaking as to damages, pending the determination of the issues at trial.

[10]The position of the Claimants can be stated quite shortly. Mr Isaac, who appears on their behalf, says the matter is very simple and that the reference to “lands”, ie. in the plural, makes absolutely clear that each of the three properties 261, 263 and 265 enjoys distinctly and separately from the others its own right across the open area directly to that property so as thereby to gain direct access. The effect of this would be either three distinct straight lines or the creation of access across an area in a “ ┬ ” or “┌ ” shape so as to ensure a strip running along and abutting each of the three properties.

[11]Mr Braithwaite, on behalf of the Defendant, contends that this is wrong and that the extent of the entitlement is to one point of access along a straight strip, of no more than 12ft in width, which internally between the three properties can then serve as access to each, ie. that having been provided with a single point of access to one of the three properties it is a matter of internal arrangement as to how access is gained from, say, 265 to 263 and 261.

[12]Mr Isaac contends that the Claimant’s position is to adopt a simple process of construction and that the 1963 transfer provides a clear and complete answer.

[13]In my judgment it is necessary to look beyond the 1963 transfer alone and to the surrounding circumstances prevailing at the time, these I have set out above. I refer to the well known passages set out by Lord Hoffmann in Investors Compensation Scheme Limited v. West Bromwich Building Society

[1998] 1 WLR 896

at 912, as to the relevant principles to apply:

“1) Interpretation is the ascertainment of the meaning which the document would convey to a reasonable person having all the background knowledge which would reasonably have been available to the parties in this situation in which they were at the time of the contract. 2) The background was famously referred to by Lord Wilberforce as the “matrix of fact”, but this phrase is, if anything, an understated description of what the background may include. Subject to the requirement that it should have been reasonably available to the parties and to the exemption to be mentioned next, it includes absolutely anything which would have affected the way in which the language of the document would have been understood by a reasonable man … 4) The meaning which a document … would convey to a reasonable man is not the same thing as the meaning of its words … the meaning of the document is what the parties using those words against the relevant background would reasonably have been understood to mean … 5) The “rule” that words should be given their “natural and ordinary meaning” reflects the commonsense proposition that we do not easily accept that people have made linguistic mistakes, particularly in formal documents. On the other hand, if one would nevertheless conclude from the background that something must have gone wrong with the language, the law does not require Judges to attribute to the parties an intention which they plainly could not have had.”

[14]From the surrounding circumstances which I have described the following factors can, in my judgement, be regarded as background knowledge which was reasonably available:(i) That the Council was acting essentially pursuant to its powers under the 1938 Act and not as a private developer at the time or with an eye to private development in the future;

(ii) That the Council had in mind some form of adjustment or alteration to the frontage of at least some of the properties on East India Dock Road;

(iii) That previous Agreements and transfers had dealt with a single strip of land 12ft in width when dealing with rights of way;

(iv) That in relevant documentation relating to planning permission over what is the Servient Land there had been some contemplation of a future right of way of 12ft in width at one defined access point.

[15]In addition to these matters Mr Braithwaite submitted that the relevant transfer refers to a “strip” and not to “strips”. And further that the more natural meaning of the word “strip” was a single straight line and that such word was not appropriate to describe a situation whereby three individual lines of access would exist or some form of “ ┬ ” or “┌ ” shape would be required to provide access abutting all three properties. I would also add that it is to be noted that if the Claimants were entitled to access abutting all three properties in the shape of lines of “ ┬ ” or “┌ ” the width of the land at the right angle of the two lines would, if they were 12ft in width, itself exceed 12ft unless narrowed off in some way.

[16]In my judgement, the Defendant is correct in its contention that the three properties are together entitled to only one means of access from a single straight strip of land across the Car Park. In my judgement, applying the principles set out in Investors Compensation Scheme Limited v West Bromwich Building Society and taking account of the surrounding circumstances which I have described as well as the matters set out in paragraph 15 above one is driven to construe the relevant clause in the way so contended for by the Defendant. If the intention had been to provide each property with a separate and distinct right of way this could have been achieved quite easily by referring to “strips” rather than a “strip” of land and identifying and referring to “each” of the properties. The word “lands” is merely the means by which the Dominant Land is identified and described in general terms, the same as would be the case, for example, by a deed conferring a right of way by using the word “fields”. The word “lands” does not, in my judgment, control or determine by itself the extent of any interference with or encroachment over the Servient Land. Issue Estoppel

[17]I turn now to address the separate point of issue estoppel. This matter was raised during the course of opening the case, Mr Isaac having presented Mr Braithwaite with a copy of an Amended Reply shortly before I came into court. For my part I would have expressed some doubt as to whether the point had been adequately pleaded but Mr Braithwaite took no such pleading point and was content for the argument to be pursued. The one qualification which was expressed was that the Claimants should not trespass into other areas such as estoppel by convention. Mr Isaac made clear that the Claimants expressly limited themselves to issue estoppel.

[18]I should now set out how this point arises.

[19]In November 2006 a hearing took place between the Claimants and the Defendant’s predecessor in title before a Deputy Adjudicator to HM Land Registry. I have been provided with a copy of the relevant decision which runs to some 11 pages. From such it is to be noted that the Deputy Adjudicator was concerned with claims made by the Claimants over the relevant area asserting “prescriptive easements in the nature of a right of way with or without vehicles, a right to park and a right to load and unload”. The claims failed on the facts. Prior to the relevant hearing certain correspondence had passed between the parties then respective solicitors. The solicitors acting for the Defendant’s predecessor wrote to the Land Registry by letter dated 26 April 2005 and included a plan of the area. On it they had coloured an area of land in the shape of an “L” running from Follett Street along the back of 261 - 265”. The width of such area varies and at one point is described as being 1.5 metres. The intention seems to have been mark what was regarded as a general area over which rights of way could be exercised.

[20]The Claimants now contend that by reason of the decision of the Deputy Adjudicator the Defendant is estopped from contesting the position advanced by them, namely, a right of way crossing an area of the land from Follett Street and which abuts on to the back of all three properties and so providing direct access for each.

[21]It is necessary to consider the terms of the decision. The Deputy Adjudicator was concerned with claims to prescriptive rights and was not attempting to construe the express grant or reach specific conclusions as to its application. Nevertheless, he noted that there had been no nomination by the then owner, or any of its predecessors, over any part of the area of land of any specific route from Follett Street to the back of any part of 261 - 265. He concluded that the absence of any route being nominated there was a right, by virtue of the 1963 transfer, over the whole of the area and that such express rights were inconsistent with the acquisition of any prescriptive rights, I refer to paragraph 13 of the decision. In relation to any ancillary right to load or unload it is correct to observe that the Deputy Adjudicator, see paragraphs 14 and 15, sought to distinguish between the physical layout of each of the properties 261, 263 and 265. It is fair to say therefore that the impression is given that the Deputy Adjudicator may have considered that each had separate and distinct claims over the whole or at least part of the relevant area.

[22]In order to succeed in a submission based on Issue Estoppel the Claimants must establish certain matters. I was referred by both Mr Isaac and Mr Braithwaite to Spencer Bower, Turner and Handley, The Doctrine of Res Judicata, 3rd Edition, and each proceeded on the basis that such was an accurate summary of the relevant test to be applied. It is necessary only to refer to certain passages: Paragraph 201:

“Even when the Court has expressly determined the same issue in the earlier proceedings an issue estoppel will not necessarily result. Only determinations which are necessary to the decision, and fundamental to it, will found an issue estoppel …”

Paragraph 202:

“The difficulty in the application of these conceptions” continued Dixon J “is to distinguish the matters fundamental or cardinal to the prior decision or judgment, or necessarily involved in it as its legal justification or foundation, from matters which, even though actually raised and decided as being in the circumstances of the case the determining considerations, yet are not in point of law the essential foundation or ground work to the judgment”, “In order to make this distinction one has to inquire whether the determination was so fundamental to the decision that the latter cannot stand without it. Even where this condition is met, it is suggested by Dixon J that there is another test to pass, viz whether the determination is the “immediate foundation” of the decision or merely “a proposition collateral or subsidiary only ie. no more than part of the reasoning supporting the conclusion”

. A mere step in the reasoning is insufficient. What is required is a determination fundamental to the decision.

[23]The essential foundation and basis of the decision by the Deputy Adjudicator was his conclusion that no specific route had been nominated and his rejection on the facts of the case advanced. Any reference he may have made, expressly or otherwise, to individual claims of each property to some express right of way was, in my judgement, at best no more than part of the reasoning supporting his own conclusions. Accordingly, I reject any claim advanced on the basis of issue estoppel.

[24]In the circumstances I find at this stage in favour of the Defendant for the reasons which I have explained. This though is not necessarily the end of the matter. In the course of his reply Mr Isaac referred me, for the first time, to a letter dated 20 September 2007 written by the Claimants’ solicitors. In it an assertion is made that if the three properties are only entitled to a single access then it should be to the rear of 261 East India Dock Road. The route favoured by the Defendant is to the rear of number 265. This is in the nature of an alternative case to the principal case advanced. It was not addressed during the course of opening and was not dealt with by Mr Braithwaite. It was agreed at the conclusion of the hearing that such matters and any consideration of the relief, if any, to be granted would be considered at an adjourned hearing when this judgment is formally handed down.