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	England and Wales High Court (Chancery Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Site Developments (Ferndown) Ltd v Barratt Homes Ltd & Ors [2007] EWHC 415 (Ch) (06 March 2007) URL: http://www.bailii.org/ew/cases/EWHC/Ch/2007/415.html Cite as: [2007] EWHC 415 (Ch)

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IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

		Royal Courts of Justice Strand. London, WC2A 2LL
		6 March 2007

RICHARD ARNOLD Q.C.:

Introduction

1. There are two applications before me. The first and main application is by the Defendants for partial reverse summary judgment. The second is by the Claimant to amend its Particulars of Claim.
2. The Claimant and the First Defendant are both property developers. The claim relates to two adjoining plots of land referred to as the Pink Land and the Blue Land at Wimborne, Dorset which have been developed into a housing estate by the First Defendant. 34 houses have been built on these plots, and the remaining Defendants are the owners or occupiers of 30 of those houses. The nub of the claim is that the Claimant alleges that it owns a small strip of land ("the Strip") adjoining the Pink Land. The Claimant claims that the Strip controls access to the Pink Land subject to a right of way, and thence to the Blue Land and to land owned by Cobham plc referred to as the Cobham Land. The Claimant also claims that part of the Strip is required for visibility splays for the access road into the development if the First Defendant is to comply with its planning permission. The Strip is of varying width but not exceeding 1.2m. The Defendants dispute the Claimant's claim to ownership of such a strip. In the alternative, the Defendants say that, if the Claimant does own the Strip, it has dedicated it as a public highway. In the further alternative, the Defendants says that the Claimant is estopped from enforcing its alleged legal rights. In addition to its claim to ownership of the Strip, the Claimant claims that it is the beneficiary of a restrictive covenant referred to as the Works Covenant affecting the Pink Land. The Defendants say that on its true construction the Works Covenant does not now bind the Pink Land. Finally, there is a dispute as to a positive covenant referred to as the Fence Covenant.
3. The Claimant seeks various heads of relief, including six injunctions, some of which are mandatory in form and some of which are prohibitory in form, and possession. The Defendants' application for summary judgment seeks a summary rejection of the claims to injunctive relief and for possession on the ground that the Claimant has no real prospect of succeeding in obtaining such relief. The Defendants say that it is manifest that the grant of injunctive relief would be oppressive and that damages should be awarded in lieu if the Claimant is otherwise successful. The Defendants also say that the Claimant is exploiting the existence of the claims to injunctive relief to tactical advantage, that the threat posed by those claims is inhibiting a sensible settlement of the dispute and that it is preventing some of the individual Defendants from selling their houses. Subject to two points discussed below, the Defendants accept that the Claimant has a real prospect of success on its underlying claims. The Defendants also accept that, if the Claimant is successful, it will be entitled to more than nominal damages although they do not accept that such damages should be quantified by reference to the First Defendant's profits as the Claimant contends.
4. As a separate matter, the Defendants seek an order that the claims against the Defendants other than the First Defendant be struck out or stayed on case management grounds.

Principles applicable to summary judgment applications

5. Since the principal application before me is an application for summary judgment, it is appropriate to remind myself of the principles applicable to such applications, and in particular the principles applicable to the question of whether there is a real prospect of success. These principles have been considered in the leading cases of Swain v Hillman [2001] 1 All ER 91 at 94-95 and Three Rivers District Council v Bank of England (No 3) [2003] 2 AC 1 at [90]-[97]. From these authorities and E D & F Man Liquid Products Ltd v Patel [2003] EWCA Civ 472 at [8]-[11] Sir Andrew Morrirt V.-C. derived the following propositions in Celador Products Ltd v Melville [2004] EWHC 2362 (Ch) at [6]-[7]:

"(a) it is for the applicant for summary judgment to demonstrate that the respondent has no real prospect of success in his claim or defence as the case may be;

(b) a 'real' prospect of success is one which is more than fanciful or merely arguable;

(c) if it is clear beyond question that the respondent will not be able at trial to establish the facts on which he relies then his prospects of success are not real; but

(d) the court is not entitled on an application for summary judgment to conduct a trial on documents without disclosure or cross-examination."

This summary was recently referred to with evident approval by Mummery LJ (with whom Longmore LJ and Lewison J agreed) in Doncaster Pharmaceuticals Group Ltd v The Bolton Pharmaceutical Co 100 Ltd [2006] EWCA Civ 661, [2007] FSR 3 at [4]-

6. To these four propositions there must be added a fifth which follows from CPR r. 24.2(b), namely that, even if the court concludes that the respondent has no real prospect of success, summary judgment may nevertheless be refused if there is a compelling reason why the case or issue should be disposed of at trial.
7. Mummery LJ went on in Doncaster v Bolton at [5]-[18] to sound a number of cautionary notes about the use of the summary judgment procedure. In particular, he said that the summary judgment procedure should be reserved for appropriate cases. His remarks at [13] are equally applicable to the present case. The papers for the hearing comprised three bulky files of statements of case, witness statements and exhibits together with two substantial files of authorities to which further authorities were added during the course of the hearing. I would particularly draw attention to the fact that the Defendants, having (as was their right) declined to give early standard disclosure before making the application, felt it necessary to serve a witness statement in reply which exhibited an entire file of documents, many of which had not previously been disclosed. Not surprisingly, this led to the Claimant serving a witness statement in rebuttal and requesting further disclosure, some of which was given just before the hearing. Equally unsurprisingly, counsel for the Claimant complained that such piecemeal disclosure was unsatisfactory. The Defendants' skeleton arguments

ran to 22 pages and the Claimant's skeleton argument to 29 pages. Finally, the hearing of the application took nearly two days of court time despite considerable pre-reading on my part. Some of that time may be attributable to my relative unfamiliarity with this area of the law, but I do not believe that that was a major factor.

8. Mummery LJ also re-iterated at [17] the familiar point that the court should exercise caution in granting summary judgment in fact-sensitive cases. Counsel for the Claimant submitted that an exercise of discretion which requires the Court to take into account all the relevant circumstances is a paradigm example of such a case. Counsel for the Defendants did not take issue with the general proposition, but submitted that in the present case there were undisputed and indisputable facts which made it obvious that no injunction would be granted.

Factual background

9. By a conveyance dated 30 June 1969 ("the 1969 Conveyance") British Railways Board ("the Board") conveyed to Flight Refuelling Ltd ("FRL") a plot of land adjoining Wimborne Station (referred to in these proceedings as the Pink Land although coloured blue on the plan annexed to the 1969 Conveyance) together with

"the right for the Purchasers and their successors in title (in common with the Board and others authorised by them or entitled thereto) to pass and repass at all time with or without vehicles over that part of the Station Forecourt shown coloured brown on the said plan".

10. Clause 3 of the 1969 Conveyance provided inter alia as follows;

"FOR the benefit and protection of such part of the adjoining or neighbouring property of the Board as is capable of being benefited or protected and with intent to bind so far as legally may be themselves and their successors in title owners for the time being of the property or any part thereof in whosesoever hand the same may come the Purchasers hereby covenant with the Board as follows:-

(1) Not at any time:-

(a) without previously submitting detailed plans and sections thereof to the Board and obtaining their approval thereto such approval not to be unreasonably withheld and

(b) without complying with such reasonable conditions as to foundations or otherwise as the Board shall deem it necessary to impose:

to erect or add to any building or structures or to execute any works on any part of the property

(2) Within six months to erect and at all times thereafter to maintain to the satisfaction of the Board fences of a design to be approved by the Board on the new common boundaries

(3) To pay to the Board from time to time a fair share (according to user) of the cost of maintaining and repairing that part of the Station Forecourt shown coloured brown on the said plan (which Forecourt shall be maintained by the Board to a standard suitable for their own purposes only)".

11. Clause 3(1) is referred to in these proceedings as the Works Covenant and clause 3(2) as the Fence Covenant. There are issues as to the construction of these Covenants that, with one exception, I am not called upon to decide.
12. It appears that Wimborne Station was closed some time after the 1969 Conveyance. By a conveyance dated 3 March 1981 the Board conveyed to Dorset County Council ("DCC") land which it had retained at the time of the 1969 Conveyance, including the old station forecourt. I was told by counsel for the Defendants that the Board appears still to exist, but performs no functions, and that its property interests in non-operational land have been vested in BRB Residuary Ltd.
13. On 11 February 1985 DCC transferred to the Claimant part of the land which it had acquired from the Board including the station forecourt. The conveyance included an obligation to construct a road in the region of the boundary which was to be the subject of an agreement under section 38 of the Highways Act 1980. On 12 February 1985 the Claimant was registered as proprietor of that land under title number DT121999.
14. Subsequently the Claimant developed its land and sold off the majority of it. Part of the Claimant's development involved the construction of an extension to Station Road over part of the forecourt. That extension was constructed and dedicated as public highway under a section 38 agreement between the Claimant and DCC dated 18 March 1985 ("the 1985 Agreement"). The Claimant claims that it deliberately retained a small strip of land between the highway and the fence which marked the boundary ("the Strip") and that the presence of the Strip is clear from the plan annexed to the 1985 Agreement.
15. Adrian Wilkes, a director of the Claimant, explains the Claimant's purpose in retaining the Strip in his first witness statement as follows:

"It has always been the Claimant's practice (as is usual for developers) to retain strips at the boundaries of its development sites. This is in order that we can retain control over the relevant strip and including the access position, and usually so as to enable us to require neighbouring landowners to deal with us when development becomes possible, and generally so that we are put in a position where we can acquire such land for our own projects or at least influence what happens on it."

Mr Wilkes says that this is what the Claimant did in. the present case.

16. On 14 October 1997 the Claimant changed the address of its registered office but did not notify the Land Registry of this.
17. It appears that in January 1999 an application was made to East Dorset District Council ("EDDC") for outline planning permission in respect of the Pink Land and the Blue Land and that such permission was granted on 12 April 2002. The Claimant's evidence is that it was not notified of this application.
18. In about May 2002 FPD Savills acting on behalf of FRL and Cobham plc advertised the Pink Land and the Blue Land for sale with offers to be submitted by 24 June 2002. The Claimant's evidence is that it was not notified ₀f this. The Defendants claim that FPD Savills' Technical Information Package gives no hint of any access problem. The Claimant claims that a plan included in the Package shows a gap between the Pink Land and Station Road in the area of the Strip.
19. The First Defendant submitted an offer which was accepted subject to contract in July 2002. The First Defendant instructed solicitors, Moore & Blatch ("M&B"), to carry out the conveyancing.
20. . On 25 July 2002 M&B wote to EDDC enquiring as to whether the roads and footpaths coloured orange on the enclosed plan were public highways. M&B said that they were particularly concerned to establish the status of the road fronting their client's property and leading off Station Road (i.e. the area where the Strip is said to be). The Claimant claims that the enclosed plan showed a gap in the area of the Strip which was not drawn to EDDC's attention. On 23 July 2002 DCC (to whom M&B's letter had been forwarded by EDDC) replied confirming that the area coloured orange on the plan was adopted highway except for an area hatched in black which is not relevant to this case. The Defendants claim that the copy of the plan enclosed with this letter shows no gap,
21. On 17 July 2002 M&B obtained an Index Map search from the Land Registry in respect of the Pink Land and the Blue Land showing that the Pink Land was unregistered. The Defendants claim that this shows that the Pink Land abutted Station Road while the Claimant claims that it shows a gap.
22. On 1 August 2002 M&B sent enquiries before contract to FRL and Cobham's solicitors to which the latter replied on 8 August 2002. The Defendants point out that the replies gave no hint of any problem regarding access.
23. On 12 August 2002 M&B wrote to Legal & Insurance Services Ltd ("LIS") seeking restrictive covenant indemnity insurance up to £3 million in respect of the covenants in the 1969 Conveyance. M&B enclosed with the letter copies of the Land Registry entries and title plan for title number DTI 76097 (the Blue Land) confirming that it was not subject to any covenants, of the 1969 Conveyance and a Land Registry print of title number DT167604 confirming that the adjoining land of the Board in 1969 was now vested in EDDC. On 13 August 2002 LJs replied offering cover. The policy covered inter cilia the cost of demolition or restoration necessary to comply with any court order. Condition 2 of the policy is as follows:

"If any step or proceedings by any third party likely to give rise to a claim under this Policy shall be induced either wholly or in part by or through any act or omission of the Insured (save as may already have occurred and be recorded in this Policy or schedule and save in relation to carrying out and using The Development) this Policy shall be void."

The Claimant says that this is a common condition in such policies which requires the developer not to trigger a claim under the covenant by communicating with those who may benefit from the covenant.

24. The office copy of the Land Registry entry for title number DT167604 dated 12 August 2002 states that the land is subject to rights granted by the conveyance dated 11 February 1985. The Claimant says that it follows from this that M&B were aware of its existence and ought to have appreciated that it might have rights relevant to the proposed purchase.
25. On 27 August 2002 M&B reported on title to the First Defendant. The report drew attention to the covenants in the 1969 Conveyance and recommended that the First Defendant take out insurance in accordance with the quotation obtained by M&B. It also enclosed a copy of EDDC's title to the adjoining land, which I assume is a reference to title number DTI 67604. The Defendants rely on the fact that the report stated that the highways search showed that the site directly abutted the public highway. The Claimant relies on the fact that it pointed out that there were no rights for the First Defendant to take visibility splays across adjoining land in third party ownership.
26. The Claimant suggests that it is likely that M&B located its title during their precontract searches, but so far as I can see there is no evidence at present that M&B did so: it is not referred to in the Index Map search of 17 July 2002, the report on title or the proposal to LIS. Furthermore the letter from the Land Registry dated 30 May 2003 referred to below apologies for the fact that the 17 July 2002 Index Map search did not show title number DT121999 and says that this was an error. In the alternative the Claimant contends that proper searches would have turned up its title.
27. The First Defendant says that its representatives inspected the land before contract and saw no evidence of the Strip. By contrast, the Claimant claims that photographs taken by Ordnance Survey in early 2003 show the Strip.
28. On 28 August 2002 the First Defendant exchanged contracts with FRL and Cobham to buy the Pink Land and the Blue Land for £1.86 million plus VAT. On the same day M&B wrote to LIS confirming that the First Defendant wished to take out the proposed policy and enclosing a cheque for £3,150 for the premium and tax.
29. On 25 September 2002 M&B obtained a second Index Map search which revealed the Claimant's title. On the present evidence this appears to be the first time that the First Defendant or M&B became aware of this. It is not clear what steps, if any, M&B or the First Defendant took in the light of this information.
30. Completion took place on 30 September 2002. The Claimant claims that the plan annexed to the transfer shows a gap in the area of the Strip. It is common ground that the transfer reserved a right of way to Cobham over the Cobham Land.
31. On 14 October 2002 M&B applied to register the First Defendant's title. On 6 March 2003 the Land Registry wrote to M&B stating that it would exclude two areas of land from the application. One of these was the Strip which was stated to be registered under title number DT121999. Subject to these exclusions, the First Defendant's title to the Pink Land and the Blue Land was registered under title number DT302096 on 10 March 2003.
32. On 12 May 2003 M&B wrote to the Land Registry expressing concern about the exclusion of the Strip from the First Defendant's title. They gave various reasons for believing that the First Defendant's land directly abutted Station Road, enclosing copies of sundry documents, but acknowledged that there was a discrepancy between the filed plans for DT121999 and DT302096. On 30 May 2003 the Land Registry replied following an intervening telephone conversation (no note of which is presently in evidence). The Registry suggested that the First Defendant apply to rectify title number DT121999 and expressed the view that the First Defendant rather than the Claimant was in possession of the land within a fence shown in the most recent Ordnance Survey map (referred to in these proceedings as the Old Fence). The Claimant says that it should have been clear that rectifying to the line of the Old Fence would not suffice for the First Defendant's purposes since it would still leave part of the Strip in the ownership of the Claimant. The Registry stated that it would serve notice of any such application on the Claimant.
33. On 5 June 2003 M&B filed an application for rectification on behalf of the First Defendant. The Land Registry duly served notice on the Claimant, but because of the unnotified change of address the Claimant did not receive this. Accordingly on 14 July 2003 the Land Registry rectified DT121999 so as to remove the part of the Strip on the First Defendant's side of the Old Fence and rectified DT302096 to add the same portion of land.
34. Meanwhile it appears that the First Defendant had made an application for detailed planning permission. On 16 June 2003 one Adrian Williams, a resident of Station Road, wrote to EDDC objecting that the First Defendant's proposed extension of the access road involved land which did not belong to the First Defendant. This letter was copied to M&B who responded on 14 July 2003 stating that the First Defendant's title had been rectified to include all the land it owned. The Claimant points out that the First Defendant did not make contact with it at this point.
35. In October 2003 someone told a director of the Claimant, Colin Burridge, about the First Defendant's planning application. Shortly afterwards Mr Williams contacted Mr Wilkes. The Claimant's evidence is that Mr Burridge telephoned a representative of the First Defendant on 3 November 2003. On the same day Mr Burridge wrote to the First Defendant (albeit apparently on behalf of P.A. Burridge & Sons Ltd) enclosing a copy of the pre-rectification Land Registry plan of the Claimant's land. On 11 November 2003 M&B replied enclosing a copy of the post-rectification plan. It appears that the Claimant also received a copy of this via Mr or Mrs Williams at around the same time. On 23 December 2003 the First Defendant wrote to EDDC enclosing a copy of the letter dated 11 November 2003, stating that no further contact had been received from Mr Burridge and expressing the hope that his was an objection that could be discounted.
36. It is not clear from the present evidence when detailed planning permission was granted or on what conditions, but the Claimant says that it seems to have required a section 38 agreement dedicating the area of the Strip and an unobstructed visibility splay across part of it.
37. Meanwhile on 19 December 2003 the Claimant's solicitors Dickinson Manser ("DM") wrote to the Land Registry querying the rectification of its title. After certain intervening correspondence, on 25 February 2004 the Registry sent DM a copy of the notice of the First Defendant's application to rectify which it had previously served, stating that it had been returned by the Post Office marked "addressee unknown". On 9 March 2004 DM replied pointing out the plan annexed to the 1969 Conveyance and the original plan filed for DT121999 showed a curved boundary whereas the land removed by the rectification had an obvious kink in it, and asking for an explanation.
38. On 17 March 2004 DM applied on behalf of the Claimant to register a unilateral notice against DT3 02096 reversing the rectification of its title. This was duly registered on 7 April 2004.
39. Meanwhile, on 29 March 2004 DM wrote to M&B advising them of the registration of the unilateral notice and stating that the letter "is intended merely to advise you of the position, and of the fact that our client is in dispute with yours as to the true ownership of the land in question". No other claim or demand was made, and in particular no reference to either the Works Covenant or the Fence Covenant. M&B replied on 30 March 2004 demanding withdrawal of the unilateral notice and putting DM on notice that the First Defendant was developing the site pursuant to planning permission.
40. Sometime in April 2004 work began on the site.
41. After intervening correspondence between DM and the Land Registry, the Registry wrote to DM on 16 April 2004 explaining that the kink which DM had queried was due to changes in the Ordnance Survey map.
42. After intervening correspondence between DM and M&B, on 20 April 2004 M&B applied on behalf of the First Defendant to cancel the unilateral notice.
43. During the course of further correspondence with the Land Registry, DM stated in a letter dated 15 June 2004 inter alia that:

"Our clients are, of course, aware of the information contained in numbered paragraph 3 of the Notice of 10 June 2003, but having inspected the land and considered the plans attached to the Conveyances dated 11 February 1985 and 3 March 1981, they consider that it is virtually impossible for accurate measurements to be taken that would establish beyond doubt that the two filed plans were inaccurate.

Upon receipt of Mr Briginshaw's letter of the 16 April our clients consulted their Surveyors, but we understand that Barratt Homes Limited have now commenced development of their land and that there are no remaining physical features which enable our clients to carry out any meaningful survey of the area in question. It was because of the commencement of the development of the land that our clients felt that they had no alternative but to register the unilateral notice.

In our view, the area of land in question is so small that it would be virtually impossible to say with any certainty that the boundary on the filed plans was in the wrong place, but if this can be demonstrated, then our clients would clearly be in a position to consider further their decision to register the unilateral notice."

44. On 23 June 2004 the Land Registry replied explaining the basis upon which rectification had taken place. On 1 July 2004 DM wrote agreeing to the removal of the unilateral notice. The letter stated that the Claimant agreed that some at least of the land in question did form part of the 1969 Conveyance, but asserted that when the Claimant developed the land in DT121999 they deliberately constructed the road to leave a strip of land between the footpath and the rectified boundary of DT302096.
45. On the same date DM wrote to M&B informing them of the Claimant's agreement to the withdrawal of the unilateral notice and continuing (emphases added):

"Our clients do, however, consider that there still remains within their title a strip of land lying between the rectified boundary of Title No DT 302096 and the rear edge of the footpath constructed within our clients land. If it is your clients intention that access to their development land should be gained at this point and that services will be laid beneath our clients land, we are instructed to enquire as to your clients proposals in this regard.

It is also noted that your clients land is subject to restrictive covenant imposed by the said Conveyance of the 30 June 1969 for the benefit of British Railways Board's retained land into whosesoever hands the same should come and we submit, therefore, that our clients now have the benefit of these covenants. We have in mind particularly the requirement for the approval of detailed plans and sections pursuant to Clause 3(l)(a) thereof.

Again, we invite your comments.'"

46. M&B replied on 2 July 2004 contending that rectified boundary of DT302096 directly abutted the highway and that evidence was required to support the Claimant's claim to the benefit of the 1969 restrictive covenants.
47. During the period 29 March to 2 July 2004, five Defendants reserved houses on the site, including the Second Defendant, a housing association. These purchasers were made aware of the unilateral notice. On 9 July 2004 M&B wrote to their solicitors as follows:

"With further reference to this matter we enclose up to date official copies of our client's title, which as you can see show that the Unilateral Notice has been removed. We are on notice that Site Developments may seek to take further action once they have considered their position. We have advised our client that the possibility of this is remote given the removal of the notice by the land registry, however, our client recognizes that purchasers may be concerned as to any future claims and accordingly our client will agree to [an indemnity]."

48. On 13 July 2004 DM wrote to both M&B and the Land Registry enclosing a plan prepared by the Claimant's surveyors showing the boundary between the two registered titles and the strip claimed by the Claimant. On 20 July 2004 the Land Registry replied explaining once again the basis upon which the boundary had been rectified. On 2 August 2004 M&B replied enclosing various documents and stating:

"Having regard to the above information and the fact that your clients have withdrawn their Unilateral Notice and accepted our clients' title, we cannot see that there is any basis for the claim made in your letter of 13^th July. In the circumstance we trust your clients will now confirm they accept that our clients' registered title directly abuts the public highway of Station Road¹'.

49. During the period from 2 July 2004 to 7 April 2005 the development was substantially completed. In addition 16 houses were sold off, nine of which were sold to the Second Defendant on 30 September 2004. Some of the purchasers, such as the Third and Fourth Defendants, purchased their properties in ignorance of the Claimant's claim since the First Defendant decided not to disclose it.
50. After an eight month silence, on 7 April 2005 DM wrote again to M&B enclosing various drawings and stating:

"Our clients position, therefore, is that although there may have been a discrepancy between the 1969 Conveyance and the 1985 Transfer which justified the rectification to which our clients initially objected, there remains in their ownership an appreciable strip of land between your clients boundary and the public highway on our clients land, over which your clients have no rights of any description.

Our clients also make the point that the sight lines depicted on your clients Section 38 plan clearly encroach on other parts of our clients land...

Our clients appreciate that your clients will need time to consider the enclosed drawings and the contents of this letter before you let us have your comments, and we would, therefore, request your reply within 21 days if receipt of this letter. Thereafter, our clients will need to consider such steps as may be available to them to protect their position."

51. There was then an exchange of correspondence between solicitors in which M&B requested copies of certain documents which DM did not provide until 3 June 2005.
52. During the period 7 April 2005 to 7 My 2005 10 more houses were sold off. The First Defendant did not advise any purchaser of the Claimant's claim, but in a few cases the purchaser's solicitors already knew about the unilateral notice and requested for their client, and were given, an indemnity in respect of it. The Sixth Defendant is an example of a purchaser who bought in this period without notice of the Claimant's claim.
53. On 7 July 2005 DM sent M&B a "CPR Pre-Action Protocol letter" running to 54 paragraphs over 9 pages which set out the Claimant's claims in detail. The letter included a list of the injunctions to which it was claimed that the Claimant was entitled, reserved the right to issue proceedings forthwith and asked the First Defendant to join with the Claimant in seeking to achieve an expeditious resolution by negotiation or litigation (including by a speedy trial).
54. As at 7 July 2005, the development was substantially complete: all but eight houses either had been sold off or contracts had been exchanged in respect of them.
55. On 1 September 2005 the Claimant sent a rather shorter Pre-Action Protocol letter to the Second Defendant.
56. The remaining eight houses were sold off by the end of 2005, and all purchasers who entered into contracts and completed in the period from 7 July to the end of 2005 were given an indemnity by the First Defendant.

The proceedings

57. The Claim Form was issued on 6 June 2006 and served with Particulars of Claim on the same day. On 28 June 2006 the First Defendant offered an indemnity to all the other Defendants who did not already have one. Since then the matter has not proceeded quickly. I was told that there were three main reasons for this. First, there was a dispute over the provision of security for costs by the Claimant which was resolved on 9 January 2007. Secondly, the First Defendant has joined DCC as a defendant to counterclaim and DCC only served its Defence on 9 February 2007. Thirdly, progress has been held up by this application. I was told that this was intimated at an early stage, but the Defendants' application notices were only issued on 22 December 2006 and 9 January 2007. In the result, pleadings have now closed but disclosure has not yet taken place and no directions for trial have been given.

The injunctions sought

58. As proposed to be amended, the injunctions sought by the Claimant are as follows:

"(a) that the First Defendant do reinstate the Claimant's Strip to how it was prior to the Development, and restraining the First Defendant from carrying out further works thereon

(b) that the First-Defendants must remove the buildings and structures erected upon the Pink Land (and including the- New Fence) and do reinstate the Pink Land to how ft was prior to the development, and restraining the Defendants from carrying out further works or erection thereupon without complying with the Works Covenant (including that they do not erect any buildings or structures upon the Pink Land without first submitting appropriate plans to the Claimant and obtaining its consent and approval)

(c) that the First Defendant do comply with the Works Covenant in relation to the New Fence by complying with the terms of the Fence Covenant by removing the New Fence and by erecting and maintaining a fence along the correct boundary i.e. along the southern side of the Claimant's Strip

(d) that the Defendants do not (by themselves, their directors, officers, servants, agents, invitees or otherwise howsoever) use and do not procure or assist anyone else (and in particular Cobham) to use the Claimant's Strip to access the Blue Land or the Cobham Land or to access the Pink Land in order to access the Blue Land or the Cobham Land

(e) that the Defendants remove or procure the removal of the Services and do not use the same

(f) that the Defendants do not (by themselves, their directors, officers, servants, agents, invitees or otherwise howsoever) and do not procure anyone else (including Cobham.) to enter upon, over or under the Claimant's Strip save in accordance with the 1969 Act Right of Way as hereinbefore declared".

Principles applicable to the grant of injunctive relief

59. An injunction is an equitable remedy. Even if a claimant establishes that his legal rights have been infringed, the court has a discretion as to whether or not to grant an injunction. The court may in an appropriate case award damages in substitution for an injunction in the exercise of the jurisdiction originally conferred by section 2 of the Chancery Amendment Act 1858, commonly known as Lord Cairns' Act, and now found in section 50 of the Supreme Court Act 1981. The court's discretion is not to be exercised arbitrarily, but according to well-settled principles, I was referred to a considerable number of authorities regarding those principles and their application to real property cases, including Wrotham Park Estate Co Ltd v Parkside Homes Ltd [1974] 1 WLR 798, Bracewell v Appleby [1975] Ch 408, Harrow London Borough Council v Donohue [1995] 1 EGLR 257, Jaggard v Sawyer [1995] 1 WLR 269, Gafford v Graham [1999] 3 EGLR 75, Mortimer v Bailey [2004] EWCA Civ 1514, [2005] 1 EGLR 1514, Midtown Ltd v City of London Real Property Co Ltd [2005] EWHC 33 (Ch), [2005] 1 EGLR 65 and Regan v Paul Properties DPF No 1 Ltd [2006] EWCA Civ 1319, [2006] 3 WLR 1131.
60. With the exception of Harrow v Donohue, each of those decisions is in essence an application of the principles laid down over a century ago in the well-known case of Shelfer v City of London Lighting Co Ltd [1895] 1 WLR 287. As Mummery LJ stated in Regan v Paul at [36], Shelfer establishes that a claimant is prima facie entitled to an injunction against a person committing a wrongful act, such as a continuing nuisance, which invades the claimant's legal right. The wrongdoer is not entitled to ask the court to sanction his wrongdoing by purchasing the claimant's rights on payment of damages assessed by the court. Accordingly it is only in exceptional circumstances that the court will exercise its discretion to award damages in lieu of an injunction.
61. On the other hand, as Millet LJ pointed out in Jaggard v Sawyer at 287D-E:

"Citation of passages in the cases warning of the danger of 'expropriating' the plaintiff need to be balanced by reference to statements like that of Lord Westbury LC in Isenberg v East India House Estate Co Ltd (1863) 3 De G J & S 263, 273 where he held that it was the duty of the court not

'by granting a mandatory injunction, to deliver over the defendants to the plaintiff bound hand and foot, in order to be made subject to any extortionate demand that he may by possibility make, but to substitute for such mandatory injunction an inquiry before itself, in order to ascertain the measure of damage that has been actually sustained.'"

62. In Shelfer AL Smith LJ said at p. 322 that it was a good working rule that

"(1) if the injury to the plaintiffs legal rights is small (2) And is one which is capable of being estimate in money, (3) And is one which can be adequately compensated by a small money payment, (4) And the case is one in which it would be oppressive to the defendant to grant an injunction - then damages in substitution for an injunction may be given".

63. AL Smith LJ went on to make it clear that what constituted a small payment was a relative matter. Subsequent cases have emphasised that AL Smith LJ's good working rule is only that: it is not a statute or straight!acket In particular, Nourse LJ stated in Gafford v Graham at 80E that the discretion to award damages in lieu of an injunction can be exercised even if the amount of damages may be large. I would add that, if it were otherwise, a claimant could oppress a defendant if the damages would be large but not if they would be small.
64. In my judgment, it is clear from the authorities that, while the position of the claimant should be considered as indicated by the first three criteria mentioned by AL Smith LJ, the key question is whether the grant of an injunction would be oppressive to the defendant, and whether it would be oppressive depends on all the relevant circumstances existing as at the date the court is asked to grant a injunction: see Sir Thomas Bingham MR and Millett LJ in Jaggard v Sawyer at 283B-C and 288B-C and H, Nourse LJ in Gafford v Graham at 80E-F and Mummery LJ in Regan v Paul at [73]. The relevant circumstances include the conduct of the parties and the reality on the ground at the time that the question falls to be decided.
65. So far as the conduct of the parties is concerned, the extent to which the claimant asserted his rights, what knowledge the defendant had of the claimant's rights when and what the defendant did when faced with the problem are particularly relevant considerations. Whether the claimant sought an interim injunction and whether the defendant sought negative declaratory relief appear to be relevant factors, but the weight of these factors appears to vary from case to case. A potentially decisive factor is if the claimant makes it clear that all he is really interested in is money, and only wants the injunction as a bargaining counter: see Nourse LJ in Gafford v Graham at 79L-M and 80D (and compare Banks v EMI Songs Ltd (No 2) [1996] EMLR 452).
66. So far as the position on the ground is concerned, the courts are reluctant to grant injunctions that will require houses to be pulled down or leave them land-locked: see Brightman J in Wrotham Park at 811A-C, Graham J in Bracewell v Appleby at 416A-D, Millet LJ in Jaggard v Sawyer at 288B-E and Nourse LJ in Gafford v Graham at 79J-K.
67. Thus far, the law seems fairly clear. Counsel for the Claimant pointed to a three areas where the law may be said to be rather less clear, however.
68. First, in Harrow v Donohue the Court of Appeal held that the court had no real discretion to exercise when the claimant had been dispossessed through the erection of a building by the defendant which had the effect of totally excluding the plaintiff from the land to which he had title. Rather the claimant had an option as to whether to accept the encroachment as an accretion to his land or to seek a remedy from the court. If he sought a remedy from the court, the court had a limited discretion as to whether to grant an order for possession or a mandatory injunction for the taking down of the offending building. Counsel for the Claimant submitted that this decision recognised the reality that, where the defendant built on the claimant's land, an award of damages in lieu would expropriate the claimant. In my judgment, however, this decision is very difficult to reconcile with the main stream of authority in this area. I note that it does not appear to have been referred to in any subsequent case. I would in any event not be deterred from granting summary judgment, if it were otherwise appropriate, by this decision since it is distinguishable on the facts.
69. Secondly, counsel for the Claimant submitted that, where the right relied upon by a claimant is ownership of land rather than a restrictive covenant or right to light or other lesser right, the claimant is entitled, even if injunctive relief to restrain future trespasses is refused, to exercise his other rights as landowner. Since the land remains his property to do with as he pleases, the claimant is entitled to exercise what might be described as a self-help remedy such as physically obstructing passage across the land e.g. by means of a gate. This point has particular force where the claimant would
70. Counsel for the Claimant replied that this tended to confirm that in reality the refusal of a mandatory injunction in such a case amounted to expropriation of the claimant's land and thus supported the approach taken in Harrow v Donohue. More importantly, perhaps, he submitted that Burton v Winters was readily distinguishable since it was concerned with the right of a claimant to self-redress involving trespass onto the defendant's land and/or destruction of the defendant's property, whereas the present case involved neither but merely the Claimant's right to make use of its own land and control passage across it (subject to the right of way). As at present advised, I would be inclined to accept this submission, but the point is not free from difficulty and I believe that it would benefit from further research and deeper argument than counsel were able to give it during the hearing before me. (Burton v Winters was one of the authorities produced during the course of the hearing, and counsel for the Defendants admitted that he had not previously been aware of it and had found it after a request from me for authority to support his submissions). Happily I do not have to decide it.
71. The third point raised by counsel for the Claimant was the impact of Human Rights Act 1998 and Article 1 of the First Protocol to the European Convention on Human Rights which provides:

"Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possession except in the public interest and subject to the conditions provided for by law and by the general principles of international law.

The preceding provisions shall not. however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties."

Counsel for the Claimant submitted that this required the court to grant an injunction or at least only to withhold one in truly exceptional cases.

72. Counsel for the Defendants accepted for the purposes of this hearing only that Article 1 was engaged, but submitted that there could be no question of Article 1 being contravened given that there was no expropriation, that the Claimant would be compensated by an award of damages if successful on the merits and that the requirement for oppression would mean that a fair balance was struck, relying on the decision of the European Court of Human Rights in J A. Pye (Oxford) Ltd v United Kingdom [2005] 3 EGLR 1. Again, as at present advised 1 would be inclined to accept this submission, but I do not have to decide the point.

Reasonable prospect of success: general considerations

73. Counsel for the Defendants characterised the injunctions sought as "ludicrous", "pointless" and "spiteful" among other epithets. Counsel for the Claimant retorted that the reasonableness of the relief sought was irrelevant: as a property owner the Claimant was not required to be reasonable in the exercise of its rights (save to the extent that the right in question incorporated a requirement of reasonableness, as in the case of the Works Covenant). I accept this: the test is not one of reasonableness but of oppression.
74. More significantly, Counsel for the Defendants submitted that it was inconceivable that any of the injunctions sought would be granted at trial since, even making every allowance in favour of the Claimant, it was manifest that the grant of the injunctions would be oppressive. In support of this submission, he particularly relied upon the following points:

i) The First Defendant has built and sold 34 houses which are now the homes of 34 families. This is now a fait accompli.

ii) The injunctions sought would apparently require the demolition of 15 houses and the land-locking of the other 19.

iii) The Strip is a ransom strip and its purpose is to enable the Claimant to extract money from a developer such as the First Defendant - that's what ransom strips are for.

iv) The Claimant had made claims to ownership of the Strip before work started but it never said: stop or we will seek injunctions. Still less did it apply for an interim injunction. On the contrary, it asked for proposals, comments and negotiation. Counsel for the Defendants argued that it is implicit, particularly in the passages in the letter dated 1 July 1994 I have italicised in paragraph 45 above, that what the Clamant really wanted, and still wants, is money.

v) The Claimant did not pursue its claims vigorously when it knew the development was under way. On the contrary, it was silent for eight months at a crucial stage.

vi) The Claimant did not bring proceedings until 11 months after its pre-action protocol letter and six months after all the houses had been sold.

vii) Before the First Defendant committed itself to buying the land it had searched against the Land Registry Index Map, and the map (wrongly, as the Land Registry later acknowledged) showed the whole of the Pink Land as unregistered; it had obtained a statement from the highway authority that the land directly abutted the highway; it was told by its vendor that there was no access problem; and it was advised by its solicitors that there was no access problem (although the visual splay would have to be sorted out).

viii) Several of the purchasers had bought not knowing that there might be a problem.

ix) The development has cost in excess of £5 million.

x) The Claimant failed to notify the Land Registry of its change of address. Had it done so, the problem might have surfaced 12 months earlier.

75. Against this, Counsel for the Claimant submitted that the Claimant should not be deprived of its proprietary rights, that there were numerous factual issues bearing upon the grant of injunctive relief that required disclosure, witness evidence and cross-examination to resolve and that even now it could be seen that there were a series of factors that militated against the refusal of injunctive relief. In support of this submission, he particularly relied upon the following points:

i) The Claimant had on its case properly established the existence of the Strip by agreeing it with DCC at the time of entering into the 1985 Agreement, marking it out clearly on the relevant plan which was deposited for public inspection, and constructing the extension to Station Road leaving a clear gap on the ground.

ii) On the Claimant's case, the First Defendant should have appreciated the existence of the Strip from the beginning. It should have seen that: the Savills Plan did not take the Pink Land up to Station Road or to the Claimant's registered title (as had been perfectly apparent to the Land Registry); the 1985 Agreement plan left a gap; and there was a gap on the ground.

iii) The First Defendant was aware of the Works Covenant prior to contracting to purchase the land and had obtained insurance in respect of it. Even if the Claimant's title had not been located at that stage (as to which the Claimant was sceptical), it should have been. Moreover, it was to be inferred that once the First Defendant had entered into the insurance policy it had deliberately refrained from contacting the Claimant once it did find the Claimant's title.

iv) The First Defendant had been specifically warned about the visual splay problem in M&B's report on title, but seemed to have done nothing about it.

v) I he First Defendant should in any event have known and appreciated the position prior to completion as a result of the pre-completion search. That had revealed the extent of the Claimant's title. Alarm bells should have rung, and the Land Registry had taken the point straightaway when the application for registration was made.

vi) It was at least possible that, in terms of acquisition, the First Defendant had taken a set of risks with its eyes open; but, if not, it had acted incompetently and/or unreasonably.

vii) If the First Defendant was misled by its vendors, then it would have a remedy against them. Likewise, if it received wrong or inadequate advice from M&B. Acting on advice was not an answer to an injunction.

viii) When the Land Registry raised the boundary problem, the First Defendant had not notified the Claimant or sought to deal with it. Nor had the First Defendant served notice of its applications for detailed planning permission on the Claimant.

ix) It should have been clear to the First Defendant, particularly from the Land Registry's letter dated 30 May 2003, that the rectification was inadequate for its purposes.

x) The Claimant had no reason to know of what was happening until October/November 1993. Thereafter it made complaints and claims, but was constitute an interference with the right of way to the Pink Land which could be restrained by an injunction. As for the trees, planting trees with the intention of obscuring a view and endangering road users' lives would also be an actionable interference with a right of way. In any event, it might well be possible to resolve the issue through discussion with the highway authority. The same was true of the dedication point. These last submissions, however, were not supported by any evidence. Furthermore, counsel for the Defendants had no real answer to the point on the declarations.

76. My conclusion on these general considerations is that the Defendants have a strong case for damages to be granted in lieu of any injunction and that the Claimant is unlikely to succeed in its claim to injunctive relief. Indeed, if I were exercising the discretion now, I would not grant any of the injunctions sought since, on what I know now, it appears to me that to grant them would be oppressive. Nevertheless, I do not feel able to conclude that the Claimant has no real prospect of success in its claim to injunctive relief. I have only been able to reach the view that I have through what has amounted to a mini-trial of the claim to injunctive relief without the benefit of proper disclosure or cross-examination and, in at least one respect, without the benefit of fully researched and developed submissions on the law. The authorities are quite clear that that is not a proper basis for summary judgment. That is particularly so given the point made by Millett LJ in Jaggard v Sawyer at 288A-B (emphasis added):

"Reported cases are merely illustrations of circumstances in which particular judges have exercised their discretion, in some cases by granting an injunction, and in others by awarding damages instead. Since they are all cases on the exercise of a discretion, none of them is a binding authority on how the discretion should be exercised. The most that any of them can demonstrate is that in similar circumstances it would not be wrong to exercise the discretion in the same way. But it does not follow that it would be wrong to exercise it differently.'"

As counsel for the Claimant submitted, I cannot be confident that, if the trial judge directing himself correctly as to the principles were to grant an injunction, the Court of Appeal would reverse him on the ground that he had exceeded the ambit of his discretion.

77. Furthermore, even if I am wrong on the question of no real prospect of success, I consider that there are two reasons for the issue to be decided at trial which taken together are compelling. The first is that all the same disclosure and evidence will have to be given even if the claim to injunctions is determined now since the documents and evidence will remain relevant to issues remaining in the case, such as the quantum of damages in lieu. The second is that some of the issues relating to the claim to injunctions will remain in the case in a different guise, in particular the issues concerning the Claimant's claims to self-help remedies and the public highway dedication point.

Real prospect of success: specific points

78. The conclusion I have reached in relation to the general considerations is not the end of the matter, however, since counsel for the Defendants also took a number of

specific points in relation to the individual injunctions sought. I shall deal with these in turn.

79. So far as injunction (a) is concerned, counsel for the Defendants submitted that, even if the Claimant succeeded in showing that it owned the Strip and that it was not public highway, the First Defendant had a right of way over it under the 1969 Conveyance which entitled it to carry out the work it had carried out and future works. As I understand it, it is common ground that the grantee of such a right of way usually has an implied right to carry out works of improvement: Newcomen v Coulson (1877) 5 Ch 133. Counsel for the Claimant submitted, however, that in the present case this right was excluded on the true construction of the 1969 Conveyance, and in particular clause 3(3). To this counsel for the Defendants submitted that the fact that a grantee was required to contribute to the cost of any works carried out by the grantor to the right of way land does not deprive the grantor of the right to carry out more substantial works at his own cost, particularly given that the requirement only applies to works carried out by the Board and the Board no longer has any interest in the land. In support of this he cited Perlman v Rayden [2004] EWHC 2192 (Ch) at [54]. Counsel for the Claimant submitted, however, that that case established no general principle and was simply a decision on the particular deed in issue in that case. As at present advised, I consider that the Defendants have the better of the argument on this issue, but I am unable to say that the Claimant has no real prospect of success.
80. So far as injunction (b) is concerned, this was originally sought against just the First Defendant. When counsel for the Defendants pointed out that the First Defendant had sold all the houses erected on the Pink Land, and therefore it had no power to remove them, counsel for the Claimant sought to amend the injunction so as to claim it against all the Defendants. As counsel for the Defendants submitted, however, there are two problems with this. First, there can be no basis for any claim against those Defendants who own houses on the Blue Land, since that is not alleged to be affected by the Works Covenant. Secondly, the Claimant has not pleaded any cause of action against those Defendants who own houses on the Pink Land - it is not enough for the Claimant to show that the First Defendant built the houses in breach of the Works Covenant. I accept, however, that the position in relation to the New Fence and a new internal road is different because the First Defendant has apparently retained ownership of these.
81. As matters stand, therefore, I would be disposed to grant the Defendants summary judgment on this claim except in so far as it relates to the New Fence and the new internal road. Since this judgment was circulated in draft, however, counsel for the Claimant has asked me to reconsider this conclusion on the ground that the Claimant wishes to advance a cause of action against the purchasers of the houses on the Pink Land as having aided and abetted breaches of the Works Covenant by the First Defendant and has submitted a revised draft of the proposed Amended Particulars of Claim pleading this. I will hear further argument on this point after this judgment has been handed down.
82. So far as injunction (c) is concerned, as originally formulated this was an attempt to enforce the Fence Covenant. It is common ground, however, that this does not bind the Pink Land since it is a positive covenant. Counsel for the Claimant sought to deal with this difficulty by amending the claim so as to invoke the Works Covenant as a means of indirectly enforcing the Fence Covenant. In my judgment, however, the Works Covenant does not provide the Claimant with a viable claim to a mandatory injunction requiting the First Defendant to erect and maintain a fence along what it says is the new boundary, because the Works Covenant does not oblige the First Defendant to carry out works at all. As for the claim for removal of the New Fence, this is now covered by injunction (b). Accordingly I will grant the Defendants summary judgment on the claim to injunction (c).
83. So far as injunction (d) is concerned, Counsel for the Defendants resisted the amendments proposed on the grounds that (1) the First Defendant had already granted Cobham a right of way and (2) there was no evidence of any threat by the First Defendant to do anything else which would amount to procuring or assisting Cobham to trespass on the Claimant's strip. Counsel for the Claimant had no real answer to these points. Accordingly I will refuse the application to amend injunction (d). The same goes for the application to amend injunction (f).

Theclajm to possession

84. As originally formulated, this was a claim to "possession of the Claimant's Strip". During the course of the hearing it was agreed that this would be amended to claim "possession as against the First Defendant of the part of the Claimant's Strip which is enclosed within the First Defendant's New Fence or on which such New Fence stands".

The position of the Second to Twenty-Eighth Defendants

85. With regard to the Defendants other than the First Defendants, during the course of the hearing the parties were able to reach an accommodation in principle, although the precise wording of the order remains to be settled. What has been agreed in principle is that, upon the Second to Twenty-Eighth Defendants undertaking to be bound by the findings and conclusions reached as against the First Defendant, all further proceedings against those Defendants will be stayed pending the determination of the claims against the First Defendant. This should leave just the question of relief against the other Defendants to be determined if the Claimant is successful against the First Defendant.

The position of the remaining purchasers and Cobham

86. The Claimant has threatened to join the purchasers of the other four houses as defendants, but has not yet done so. It seems to me that, if they are to be joined, it would be sensible for the claims against them to be stayed on the same terms. I invite the Claimant to decide whether it wishes to join these purchasers and, if so, to ascertain whether they will agree to a stay on the same terms.
87. As for Cobham, although I have held that there is no basis for the injunctive relief affecting it sought in the draft Amended Particulars of Claim, it is still potentially affected by the other relief sought by the Claimant, in particular the first declaration claimed as proposed to be amended. As I understand it, the Claimant does not intend to join Cobham as a defendant even if it could. Cobham may nevertheless wish to be joined as a party or to intervene in some way. Accordingly, as a condition of permission to amend, I will require the Claimant to send Cobham a copy of the Amended Particulars of Claim for information.

Speedy trial

88. The Claimant suggested that the Defendants' concerns about the claim to injunctions could be ameliorated by an order for a speedy trial. I am unable to see that such an order would be justified having regard to the history of these proceedings, for they could have been tried by now. Nevertheless, I am clear that the matter should be tried as soon as is practicable without making a speedy trial order as such. Counsel for the Claimant suggested that claim could be ready for trial by the beginning of July, while counsel for the Defendants suggested that September or October would be more practicable. At present I am minded to give directions designed to ensure trial in July, but I will hear further argument after this judgment is handed down if the parties are unable to agree suitable directions.

Mediation

89. The Claimant pointed out that it had suggested that this dispute be the subject of mediation, but the Defendants had refused to participate. Counsel for the Defendants explained that the Defendants were not prepared to mediate while the threat of injunctions was hanging over them. I will refrain from expressing a view as to the reasonableness or otherwise of that stance. I will, however, express the hope that, now the parties have had the benefit of hearing each other's arguments in detail and receiving an impartial evaluation of them, they will agree to mediate and reach a compromise of this dispute.

Conclusion

90. Save to the extent indicated in paragraphs 85 to 87 above, the Defendants' application for summary judgment is refused. Save to the extent indicated in paragraphs 85 to 88 above, the Claimant is granted permission to amend the Particulars of Claim as originally sought. I will stay the proceedings against the Second to Twenty-Eighth Defendants and I will make directions for trial as soon as practicable. I invite counsel to agree a form of order to give effect to these conclusions. I will hear further argument upon the Claimant's application to amend to plead a claim of aiding and abetting breaches of the Works Covenant, anything else that cannot be agreed and costs.