P & S Platt Ltd. v Crouch & Anor

Section 62 of the Law of Property Act 1925 converts qualifying quasi-easements into legal easements when part of commonly owned land is conveyed, unless a contrary intention is expressed or objectively established. The relevant rights must appertain, or be reputed to appertain, to the conveyed land or be enjoyed with it. Prior negotiations are generally excluded when construing the conveyance, although objective background concerning the transaction’s genesis and aim may be considered. A right is incapable of being an easement only where it would effectively deprive the servient owner of any reasonable use. That question is one of fact and degree. The claimed mooring and ancillary rights satisfied these requirements.

The appellants transferred Petersfield House Hotel to the respondent while retaining Noosa Sound, including river moorings and a path connecting the moorings to Lower Street. The transfer contained no provision excluding or modifying section 62 of the Law of Property Act 1925. The respondent claimed rights to use the moorings and associated rights to display signs, fish and pass over the retained land.

The High Court declared that the mooring and ancillary rights had passed, but rejected the claimed fishing right and dismissed the appellants’ rectification counterclaim. The appellants appealed, arguing that the parties’ intention excluded the rights and that their exercise would deprive the retained land of reasonable use. The central issues were the relevance of pre-contract negotiations and whether the rights were capable of existing as easements.

The appeal was dismissed unanimously. Peter Gibson LJ gave the principal judgment. Dyson LJ agreed, and Longmore LJ added reasoning on the admissibility of negotiations.

1. Statutory operation. Section 62 applied because the claimed rights and advantages appertained, or were reputed to appertain, to the hotel and were enjoyed with it as part of the hotel business. They were advertised and used by hotel patrons. The rights were continuous and apparent. Common ownership before the transfer did not prevent them becoming easements on the transfer.
2. Contrary intention and negotiations. Section 62 operated subject to a contrary intention expressed in the conveyance or established by relevant circumstances. The reasoning in Birmingham, Dudley and District Banking Co. v Ross (1888) 38 Ch D 295 did not permit the court to rely generally on pre-contract negotiations. The rule in Prenn v Simmonds [1971] 1 WLR 1381, explained by ICS Ltd. v West Bromwich Building Society [1998] 1 WLR 896, excluded such negotiations from construction because they were an uncertain guide to the parties’ final agreement. Objective background, including the genesis and aim of the transaction, remained admissible. The particulars of sale objectively indicated that the hotel was sold as a going concern whose business included boating and mooring facilities. No contrary agreement or common intention was established. The failed rectification claim was not pursued on appeal.
3. Capacity to be easements. A right cannot exist as an easement if it would effectively deprive the servient owner of any reasonable use of the affected land. This is a question of fact and degree, and appellate interference with the trial judge’s assessment requires a significant error or a plainly wrong conclusion. The seasonal moorings and occasional passage of hotel guests caused some detriment but did not deprive the appellants of reasonable use. The residual value of Noosa Sound also did not suggest that their ownership was illusory. The approach in Copeland v Greenhalf [1952] Ch. 488, London & Blenheim Ltd. v Ladbroke Retail Parks Ltd. 1992 1 WLR 1278 and Batchelor v Marlow (2001) 82 P & CR 36 was therefore satisfied.
4. Postscript. The trial judge’s speculation about the appellants’ motives was unnecessary, unsupported and regrettable. It did not affect the outcome.

1. Court of Appeal (Civil Division): The appeal was dismissed unanimously. The court upheld the High Court’s declarations concerning the mooring and ancillary rights. [2003] EWCA Civ 1110
2. High Court, Chancery Division: HH Judge Richard Seymour Q.C. declared that the mooring and ancillary rights had passed under section 62 of the Law of Property Act 1925, rejected the claimed fishing right and dismissed the rectification counterclaim. No injunction was granted.