Bethell v Bethell [2015] NZHC 1375 (17 June 2015)

Last Updated: 8 July 2015

IN THE HIGH COURTOF NEW ZEALAND AUCKLAND REGISTRY

CIV-2012-404-001797 [2015] NZHC 1375

BETWEEN	CHRISTINE ANNE BETHELL Plaintiff
AND	VICTORIA ELIZABETH BETHELL Defendant / First Counterclaim Plaintiff MARIA GAEL BETHELL Second Counterclaim Plaintiff

Hearing:	2-4 March 2015
Appearances:	R Thompson and S Park for Plaintiff S A Grant and B Saldanha for Defendant and Second Counterclaim Plaintiff
Judgment:	17 June 2015

_{JUDGMENT OF COURTNEY J}

BETHELL v BETHELL [2015] NZHC 1375 [17 June 2015]

Introduction

[1] In my decision dated 20 December 2013 I made an order for specific performance requiring the defendant, Victoria Bethell (Vicky),¹ to convey to the plaintiff, Christine Bethell (Chrissie), “4.047 hectares being Lot 1 of CT NA6B/653 as approved for subdivision in the decision of the Waitakere City Council dated

_{10 May 2007”.}² _{This order was affirmed by the Court of Appeal}³ _{but has not yet}

been complied with because it has now been discovered that the area shown in the subdivision scheme plan as Lot 1 is actually 3.7603 hectares, not 4.047 hectares.

[2] Vicky lodged a survey plan that reflects the original scheme plan for the purposes of obtaining approval for the subdivision of Lot 1. But Chrissie maintains that she is entitled to receive 4.047 hectares and that a title for Lot 1 based on this plan will not comply with the order for specific performance. Chrissie has applied for directions requiring Vicky to take all the steps necessary, at her cost, to transfer Lot 1 of CT NA6B/653 in accordance with a proposed plan that encompasses 4.047 hectares. An order in the terms sought would result in an alteration to the boundaries shown on the current survey plan.

[3] Chrissie also seeks directions regarding gates that she claims Vicky has wrongly removed from Lot 1. Vicky asserts that the gates were chattels, not fixtures, and that she was entitled to remove them.

[4] Vicky opposes the application. She asserts that:

(a) The Court of Appeal held that the area to which Chrissie is entitled is defined by the boundaries shown in the scheme plan and the issue is therefore res judicata in this Court.

(b) Alternatively, the directions sought constitute a variation to the order for specific performance and this Court has no jurisdiction to make

_{such directions.}

1. During the hearing counsel and the parties themselves used the first names by which they are known. For clarity and convenience I do likewise.

² _{Bethell v Bethell [2013] NZHC 3492.}

³ Bethell v Bethell [2014] NZCA 442.

(c) If orders are made that have the effect of altering the boundaries, the Court should take into account the effect on Vicky and Maria when re- drawing the boundaries.

[5] The order for specific performance also required Maria Bethell to vacate the house located on Lot 1 that she had occupied for some years. Pursuant to an agreement reached with Chrissie in February 2014, Maria was permitted to remain in the house on the condition that she would pay rent and maintain the property. Chrissie asserts that when Maria vacated the house in late 2014 she removed a water tank and wood-burner fireplace, which Chrissie claims were fixtures. Chrissie seeks orders regarding an accounting for the rent due and the reinstatement of these items or, if they cannot be reinstated, an inquiry into damages to compensate for their loss.

[6] Maria maintains that these items were chattels that she was entitled to remove. She also seeks to have her liability for rent set off against the cost of rates, insurance and maintenance of the house over the relevant period.

[7] The Court’s jurisdiction to make the orders sought arises from its power, once it has made an order for specific performance, to control performance of the agreement acting upon equitable principles.⁴

Background

[8] The land that is the subject of the proceedings is part of a very large block of coastal land that has been in the Bethell family for over a century. At the relevant times this block was owned by Chrissie’s brother, Ross Bethell, and following his death in 2008, by Vicky, Ross’ widow and executor. Maria is Ross’ first wife.

[9] Under a 1987 deed of family arrangement Chrissie had the right to call for up to 10 acres of land in the vicinity of what was known within the family as the camping ground and the clay patch, provided that consent to subdivide could be

_{obtained while she and Ross were still alive.}

⁴ Hutton v Palmer [1990] 2 NZLR 260 (CA) at 270.

[10] Chrissie exercised that right in 1991 and called for 10 acres.⁵ While Ross was still alive she obtained consent from the Waitakere City Council to subdivide an area of 4.047 hectares (10 acres) as Lot 1. The remainder of the block would be Lot 2. A firm of surveyors, Cato Bolam, prepared the application and scheme plan showing the boundaries of the proposed Lot 1. The scheme plan noted that areas and measurements were “subject to survey”.

[11] The Council’s subdivision consent was to expire on 10 May 2014. In order to complete the subdivision a survey plan conforming to the subdivision consent had to be lodged with the Council by that date.⁶ A surveyor from Cato Bolam, Mr Parker, arranged a site visit. During that visit Vicky raised the possibility of altering the boundary line shown on the scheme plan to exclude her front lawn from Lot 1; the area had special and very personal significance for her. Mr Parker indicated that an adjustment to the boundary lines would be possible. Vicky later emailed him a line drawing showing how the boundary could be altered.

[12] The surveyor contacted Chrissie regarding the front lawn area. She indicated her agreement to altering the boundary to exclude that part of Vicky’s lawn. Vicky gave evidence that she did not intend her comments to signal the start of negotiations over the boundaries then shown on the scheme plan and that she did not ask and did not expect the surveyor to take the matter up with Chrissie. Whilst I accept that Vicky gave her evidence honestly, I have difficulty understanding how she thought that this change could have been achieved without Chrissie’s agreement.

[13] In her email Vicky had also said that the plan would need to include an easement over the north-western corner of Lot 1 where the driveway entered from the public road and crossed to the south-west to rejoin the road. This was a change that Vicky placed quite some importance on; without it the only access to the back part of Lot 2 and to relatives and neighbours in the vicinity of that area would be

_{much longer and more difficult.}

⁵ _{These were findings that I made and that were upheld by the Court of Appeal.}

⁶ Resource Management Act 1991, s 223.

[14] At about the same time Chrissie’s counsel approached Vicky’s counsel about the possibility of obtaining a survey plan that provided for separate driveways for Lots 1 and 2.

[15] Cato Bolam proceeded to complete its survey. It soon identified a problem; the area depicted in the scheme plan, which all parties had believed to be 4.047 hectares (10 acres), was actually 3.7603 hectares (9.2 acres). Cato Bolam requested a meeting with Vicky to discuss this. At that stage, unaware of the problem, she saw no need for a meeting and asked for an explanation. In an email sent on 31 March

2014 Peter Reaburn, a surveyor and director of Cato Bolam, explained that the scheme plan did not show the full 10 acres but observed that this was not unusual and when it happens “we generally just widen out the boundaries to fit”. In this case, however, the alteration to exclude Vicky’s lawn had to be reconsidered. Nevertheless, Mr Reaburn expected that Council approval could be obtained and said that Cato Bolam had come up with “a couple of options” that he needed to discuss with her.

[16] Vicky met with Mr Reaburn later that day. She claimed that he was not specific about the extent of the discrepancy. A few days later she emailed Cato Bolam again expressing concern about the 10 May deadline and the time that it might take to change the plan:

... I am thinking it may be instead necessary that we lodge the original, unaltered resource consent plan (not changing anything including the acreage) to be the most prompt and efficient means of guaranteeing that we succeed within the critical timeframe.

[17] She sent another very similar email the following day. It is evident from these emails that in early April 2014 Vicky still did not know the exact difference between the scheme plan and the survey result.

[18] There was a meeting on 7 April 2014 between Chrissie, Vicky and Mr Reaburn to discuss the lodgement of the survey plan. Vicky’s partner, Paul Wittington, also attended. There were some differences in the accounts given by Vicky, Chrissie and Mr Reaburn. This is a convenient point at which to note that, whilst Mr Thompson sought and obtained leave to cross-examine Vicky and Maria

(over Ms Grant’s opposition), there was no corresponding request to cross-examine

any of Chrissie’s witnesses.

[19] It is clear from the weight of the evidence that Mr Reaburn explained that the scheme plan depicted an area that was less than 10 acres and that the irregularity had arisen through the use of aerial photographs to produce the original scheme plan which was less accurate than undertaking a survey, although whether the precise discrepancy was identified is not clear. I accept, too, that Mr Reaburn made it clear that a survey plan showing either the 10 acres or a lesser area could be prepared for lodging with the Council and that he did not anticipate any difficulty in amending the scheme plan to reflect the survey plan.

[20] Vicky accepted that Mr Reaburn and John Wisker (another Cato Bolam director, who attended a second meeting on 9 April) had said that there was no difficulty expected in obtaining consent for either of the areas. However, her fear was that the time required to complete a survey plan showing the larger area would run beyond the expiry date for the consent. I accept, having listened carefully to Vicky’s evidence, that she was genuinely concerned not to risk lodging a survey plan that did not conform to the scheme plan, thereby losing the opportunity to obtain approval for the subdivision.

[21] At the 7 April meeting two new plans were tabled for discussion. They were referred to as option A and option B. They each proposed an amendment to the existing scheme plan that would result in Lot 1 being less than 4.047 hectares. Under option A the area would be 3.8712 hectares. Under option B it would be

3.924 hectares. Both showed the eastern boundary moved back from Vicky’s lawn and a new “dog leg” taking in an area of pine trees between the camping ground and Vicky’s house in compensation. Both also showed the right of way over the north- western tip of Lot 1 near Bethells Road, which would have provided Vicky with easier access to the back of Lot 2 and to other properties in the area.

[22] There was a dispute as to whether options A and B came to be produced on Vicky’s instructions or on Cato Bolam’s own initiative. It is not significant and I do not need to resolve the issue. Chrissie indicated she would accept option B except

for the right of way over the north-western tip of Lot 1. However, although Chrissie did not want to grant the proposed right of way she assured Vicky that access would not be refused. She claimed that Vicky refused to discuss alternatives. Vicky claims that no alternative proposals were made for her to consider; she was at pains to emphasise that her main concern was not to jeopardise the deadline for lodging the survey plan.

[23] Negotiations continued on 9 April 2014 at the second meeting attended by Vicky, Mr Wittington, Chrissie, Kevin Matthews (Chrissie’s partner), Mr Reaburn and Mr Wisker. No agreement was reached. On Chrissie’s account, Vicky ended the meeting by saying that if Chrissie would not agree to the right of way over the north- western tip then she would submit the survey plan for 9.2 acres. Vicky maintains that she insisted on the existing plan being used only because she was not confident that Cato Bolam’s belief that the boundaries could be adjusted gave adequate assurance that the s 223 approval would be obtained.

[24] Despite withdrawing her instructions from Cato Bolam immediately after this meeting, Vicky later instructed it to complete and lodge a survey plan that reflected the original scheme plan, which it did. The current position is that s 223 approval has been issued for a subdivision of 3.7603 hectares. However, the actual survey has not yet been carried out and a survey plan has not been lodged with LINZ. Mr Wisker has deposed that the Council could agree to accept a substitute plan prepared in accordance with the one Chrissie now proposes. However, he expects that the Council would require a fresh resource consent. The cost of both steps would total approximately $11,000 plus GST.

[25] Vicky was very clear in her evidence before me that she understood that the order for specific performance required her to obtain Council approval on the basis of the existing scheme plan. This was somewhat inconsistent with the fact that she was clearly prepared to engage in a negotiation over amendment to that plan but I accept that she was strongly motivated to avoid the risk of running out of time to lodge a plan that she could be confident would be approved.

[26] Also in dispute is whether Chrissie concluded these meetings by making it clear that she still wanted the 10 acres to which the Court of Appeal had confirmed she was entitled. Chrissie said she made it clear at both meetings. Her partner, Mr Matthews, confirmed that. Mr Reaburn and Mr Wisker confirmed it. Vicky’s partner Mr Wittington, who also attended the meetings, did not provide an affidavit.

[27] Vicky was adamant that Chrissie had not said anything at the meetings about still wanting 10 acres. Further, she expressed her strong view that Mr Reaburn and Mr Wisker were both lying to minimise their professional exposure arising from the discrepancy between the scheme plan and the survey plan. This was a very serious allegation to make and had Ms Grant sought leave to cross-examine those witnesses I would certainly have granted it. I am not prepared to draw any adverse inference regarding their honesty without their having had the opportunity to respond. On balance I find that Chrissie did make it clear that she wanted 10 acres and was not happy for a survey plan to be lodged that did not reflect an area of that size. I do not accept Ms Grant’s submission that she acquiesced in Vicky’s course of conduct.

The application for directions as to specific performance

Is the determination of the boundaries res judicata as a result of the Court of

Appeal’s decision?

[28] Ms Grant advanced two general arguments in support of her submission that it was no longer possible for Chrissie to seek a variation of the order for specific performance so as to amend the boundaries. The first was that the Court of Appeal had held that Chrissie had elected the boundaries of Lot 1 when she applied for resource consent, namely those shown on the scheme plan; the matter was therefore res judicata and Chrissie could not now seek to amend the boundaries. Some additional information is necessary before considering this argument.

[29] In its decision the Court of Appeal dismissed a late application made on

Vicky’s behalf to adduce further evidence on the appeal. In concluding its discussion

_{on the application the Court said:}⁷

⁷ At [97].

Ms Grant relied particularly on the undisputed fact that it emerged during the course of the April 2014 discussions that when a formal survey plan was completed for s 223 purposes, the land area shown on the scheme plan of subdivision was only 9.2 acres. In a letter from the surveyors they explain that the scheme plan was prepared from an aerial photograph and this has resulted in the discrepancy. Nevertheless the consent is for 10 acres and the surveyors’ advice is that the boundaries can be adjusted to 10 acres or Chrissie may accept the 9.2 acres shown on the scheme plan. There is nothing material in this point.

[30] As originally issued the penultimate sentence of [97] was:

Chrissie has chosen the latter and the s 223 survey plan was issued on that basis. There is nothing material in this point.

[31] Following an application on behalf of Chrissie, pointing out that her position had always been and still was to seek the full 10 acres, the Court re-issued the decision without that penultimate sentence. Ms Grant argued, however, that a statement made by the Court at [69] of the judgment had the effect of holding that Chrissie had elected the boundaries as shown on the original scheme plan and since there had been no request to redact that statement Chrissie was bound by it. The statement at [69] of the judgment on which Ms Grant relied was:

... The precise boundaries were ultimately defined by [Chrissie’s] application for subdivision and the survey plan that followed after the Council’s consent.

[32] Ms Grant submitted that, on the basis of this statement, the issue regarding the boundaries of Lot 1 was res judicata and this Court could not now amend the order for specific performance to allow Chrissie to alter the boundaries.

[33] Whilst the last sentence in [69] does suggest that the Court considered that Chrissie had defined the size and shape of her land by reference to the subdivision application and survey plan, the judgment read as a whole does not have that effect. The issues being considered by the Court of Appeal related to Chrissie’s rights and Vicky’s corresponding obligations as Ross’ executor under the deed of family arrangement. The Court of Appeal confirmed that Chrissie had the right to call for

an allotment up to 10 acres in the vicinity of the camping ground.⁸ Vicky’s

_{obligations were to sign the documents necessary to enable Chrissie to receive her}

⁸ At [55]-[56].

claimed allotment and, beyond the signing of the plans and relevant documents, an implied positive obligation “to facilitate the allocation and subdivision of the area up to 10 acres for Chrissie when she called for it”.⁹

[34] It is evident that the Court proceeded (as did I) on the basis that Chrissie had made a specific call in 1991 for 10 acres and it was only the precise location of the land and shape of the lot that was unknown; it was those matters to which the Court was therefore referring in the last sentence. The statements at [69] are a summary of the preceding discussion on those matters; the whole of [69] read:

On our approach, Chrissie’s equitable interest in the land first arose upon the execution of the Deed in 1987 and did not require any further definition at that stage. Her interest at that point was limited to the right to call for the land. When she made her call in 1991, she defined the size of the area she sought up to the maximum of 10 acres. Neither the precise location of the land nor the shape of the lot needed to be defined at that point to be enforceable. Those matters were capable of ascertainment at Chrissie’s election (so long as it was in the vicinity of the camping ground) or in the manner adopted by the Judge we shortly discuss or by the final determination of the Court if necessary. The precise boundaries were ultimately defined by her application for subdivision and the survey plan that followed after the Council’s consent.

[35] Moreover, the Court of Appeal was not concerned with the discrepancy that had been discovered between the scheme plan and the survey. Although the fact of that discrepancy had been raised in the context of the unsuccessful application to adduce further evidence, it had no relevance to the issues being decided, which were identified at [16]; the Court of Appeal was considering whether Chrissie had the right to call for up to 10 acres and whether she had exercised that right. It was not concerned with what the boundaries of the subdivision would ultimately be. The statement at the end of [69] can only be regarded as obiter with the result that the issue is not res judicata.

[36] In any event, the concluding comments at [97] make it absolutely clear that the Court of Appeal was not intending to curtail the possibility of the boundaries being adjusted. It is not tenable to suggest that in the main part of the judgment,

_{when adjustment of the boundaries was not an issue, the Court should have intended}

⁹ At [64].

to make a finding that precluded that possibility but then gone on to signal in unmistakeable terms that such a course was possible.

Is the order for specific performance limited to the area shown in the scheme plan?

[37] I turn next to Ms Grant’s submission that the terms of the order for specific performance do not allow for an amendment to the boundaries because the order requires the transfer of an allotment and an allotment is not determined by size but by boundaries. In this she relied on the following definition of “allotment” at s 218(2) of the Resource Management Act 1991 (RMA):

(a) any parcel of land under the Land Transfer Act 1952 that is a continuous area and whose boundaries are shown separately on a survey plan, whether or not –

(i) the subdivision shown on the survey plan has been allowed, or subdivision approval has been granted, under another Act; or

(ii) a subdivision consent for the subdivision shown on the

survey plan has been granted under this Act; ...

[38] Ms Grant submitted that the reason allotments, as defined in the RMA, are determined by boundaries rather than size is that once a survey plan is approved it is submitted to the Registrar-General of Land for the issuing of a separate certificate of title based on that plan. Boundaries define the size of the allotment and the stated size of the land comes secondary to the boundaries.

[39] I do not accept that submission. At the time the order for specific performance was made no plan existed that could be regarded as a survey plan for the purposes of s 218. There was a scheme plan only, which had been prepared on the basis of aerial photographs and is acknowledged to be inaccurate. Not until a survey plan was prepared would an allotment exist within the definition of s 218 of the RMA.

[40] Ms Grant also rejected the argument that because the plan was marked “subject to survey” the surveyors were able to change the boundaries to make the allotment contain 10 acres. She submitted that an amended plan of the kind proposed by Cato Bolam at the April 2014 meetings would not conform to the

resource consent sufficiently to obtain s 223 approval. These submissions run counter to the evidence. Whether the Council would have accepted a survey plan amended in accordance with options A or B was the subject of evidence from Mr Reaburn and Mr Wisker, both highly experienced surveyors who gave their evidence in accordance with the code of conduct for expert witnesses in the High Court Rules.

[41] In his affidavit of 9 February 2015 Mr Reaburn referred to the fact that the

original scheme plan was “subject to survey” and said that:

In my experience councils anticipate and allow some variance in such a plan once a survey is undertaken, and in this instance we foresaw no problems with Council approving an amended scheme plan for Lot 1 which was for ten acres.

[42] In his reply affidavit he said:

... I made it clear to Victoria that the consented area of ten acres for Lot One could be reduced to 9.2 acres, or alternatively the boundaries could be drawn to ten acres, or areas in between those two. I did not suggest to Victoria Bethell that there were going to be problems with obtaining Council approval of those changes. I made it clear I believed the Council would accept those changes. If there was to be any difficulty with Council, I explained it was more likely to be in relation to the change of boundaries to accommodate Victoria’s back lawn, but I was still confident it would be approved with those changes.

Normally, if not for Victoria Bethell’s concerns that the eastern boundary would embrace some of her back yard, we would have just moved the eastern boundary out by roughly an average of ten metres. That is all it would have taken to obtain Council approval of a survey plan for the full ten acres. However we were confident that we could also make the adjustments to meet Victoria Bethell’s concerns and still obtain Council approval for the full ten acres.

[43] There was no request to cross-examine either witness. Nor was any evidence produced to challenge these views. In these circumstances I do not accept that the Council would have rejected a survey plan that encompassed 10 acres.

Does the Court have the power to make supplementary orders?

[44] Ms Grant acknowledged that this Court has the power to make orders supplementary to the order for specific performance but argued that the circumstances in which that might be done were limited and such orders would not

be permissible in this case. She relied on Universal Homes Ltd v Kloet¹⁰ in which Chilwell J referred to Brightman J’s decision in Ford-Hunt v Raghbir Singh¹¹ and said:¹²

The conclusion to be drawn from the authorities cited by Brightman J appears to me to be that while the general rule is that a court has no jurisdiction to vary its order after it has been passed and entered, there is, apart from the slip rule which did not apply in that case or in the present case, an exception to the general rule where the new order sought is grounded on facts not available at the time when the original order was made and where the new order does not alter the original order, that is, where it is truly supplemental.

[45] Ms Grant argued that there was no change in the factual position in the present case; rather, a fact has simply been shown to be incorrect. I do not accept that. At trial Chrissie’s case was put squarely on the basis of her entitlement to

10 acres. It was found by both me and the Court of Appeal that Chrissie called for

10 acres. When she applied for subdivision consent of Lot 1 she sought an area of

10 acres in the belief that the area shown within the boundaries on the scheme plan was that size. The discrepancy inherent in the application for subdivision consent was unknown to any of the parties at the time. The change in the factual position is the discovery of the error after the order for specific performance was made and at a time when a survey plan could have been produced that rectified that discrepancy.

[46] As for whether the order sought by Chrissie is “truly supplemental” in that it does not alter the original order, the answer to this depends on whether the overall effect of the original order was that Vicky was required to convey “Lot 1” or “4.047 hectares”. Vicky’s submission is that the focus of the Court should be on the requirement that she convey Lot 1 to Chrissie. On that reading, an order allowing for the land’s boundaries to be adjusted could be said to impermissibly alter the original order. However, for the reasons just discussed I find that the overall effect of the original order was that Vicky was required to convey 4.047 hectares to Chrissie. This, after all, was Chrissie’s entitlement and what all parties initially thought she was to receive. From that starting point an additional order enabling the

_{transfer of 4.047 hectares is supplemental and does not alter the original order.}

¹⁰ _{Universal Homes Ltd v Kloet [1976] 1 NZLR 246.}

¹¹ _{Ford-Hunt v Raghbir Singh [1973] 1 WLR 738 (Ch).}

¹² At 248.

[47] Finally, Ms Grant submitted that abandoning the eastern boundary as shown on the scheme and survey plans would take away a significant plank in the Court’s reasoning – in particular, the finding that the eastern boundary was so obvious that Ross Bethell must have known where it was – and would involve the adoption of a different basis for drawing the eastern boundary. There is no weight in this submission. On Mr Reaburn’s evidence the eastern boundary would have simply been moved out by an average of 10 metres. The more significant change shown on the plan now proposed has been included to accommodate Vicky’s wish that the boundary not cut across her lawn. Further, the Court of Appeal made it clear in its decision that there was no need for precise definition of the boundaries and that the

Court could, if necessary, settle the boundaries itself.¹³

What directions should be made?

[48] The production of a survey plan that enabled the order for specific performance to be complied with was Vicky’s responsibility. Although I accept she was primarily motivated by the tight timeframe, whether she acted reasonably or not is not relevant. She had an obligation under the deed to facilitate Chrissie’s claim for

10 acres. On the evidence this could have been achieved.

[49] Ms Grant submitted that if I were to hold that I had the power to re-draw the boundary then I must be relying on the Court’s equitable powers to do so, and therefore I could and should take into account other factors relevant in equity. Drawing on the House of Lords’ decision in Co-operative Insurance Society Ltd v Argyll Stores (Holdings) Ltd,¹⁴ she argued that granting specific performance in the terms sought by Chrissie would result in injustice to Maria and Vicky and that the terms of the order could and should be drawn so as to reduce that injustice.

[50] Argyll Stores is not factually analogous to this case. The question there was whether an order for specific performance should be made requiring a lessee to run its business from the leased premises until the landlord could secure a replacement tenant. The decision is, however, valuable for the discussion regarding the nature

_{and limitations of an order for specific performance. Ms Grant submits that Lord}

¹³ _{At [61], [69] and [70].}

¹⁴ Co-operative Insurance Society Ltd v Argyll Stores (Holdings) Ltd [1997] UKHL 17; [1998] AC 1 (HL).

Hoffmann’s observations regarding the risk of injustice by allowing the plaintiff to

enrich himself at the defendant’s expense are relevant to the present case:¹⁵

The loss which the defendant may suffer through having to comply with the order ... may be far greater than the plaintiff would suffer from the contract being broken.

...

It is true that the defendant has, by his own breach of contract, put himself in such an unfortunate position. But the purpose of the law of contract is not to punish wrongdoing but to satisfy the expectations of the party entitled to performance. A remedy which enables him to secure, in money terms, more than the performance due to him is unjust.

[51] The three matters that concern Vicky and Maria are Vicky’s front lawn, the house located on Lot 1 and the right of way on the north-western corner. No difficulty arises in relation to the first; Chrissie has made it clear that she wishes to accommodate Vicky in this and has drawn the proposed revised boundary accordingly.

[52] Drawing the boundary so as to exclude the house, however, would radically change the shape of Lot 1. More significantly, it would be contrary to one of the underlying reasons that the right to call for the 10 acres was conferred on Chrissie in the first place. In my earlier judgment I described in some detail the evidence which led to the conclusion that the approximately six acres in the area known as the clay patch (where the house is currently located) was to be set aside for Chrissie because that is where she planned to build a house for herself. There are no feasible means by which the boundaries could be altered so as to both exclude that house and retain one of the essential benefits of the right conferred on Chrissie by the deed of family arrangement.

[53] This leaves the right of way sought by Vicky at the north-western end of Lot 1. It is evident that access to the back of Lot 2 will be made immeasurably more difficult if Vicky cannot use the accessway historically relied on to link Bethells

_{Road with the road to the west of Lot 1. I had the benefit of visiting the site prior to}

¹⁵ At 15.

writing my previous decision. The terrain is very difficult and access a constant challenge.

[54] I have no doubt that if Ross or Vicky had facilitated the subdivision of Lot 1 at a much earlier stage this right of way would have been granted. Given the good relations between Chrissie’s and Maria’s sons and, indeed, between Chrissie’s sons and Vicky, it is to be hoped that future generations of this family will find a more co- operative basis on which to live in proximity to one another. Now, however, it is understandable from Chrissie’s perspective that she should not wish to grant a right of way to Vicky. Vicky may well have acted in the honest belief that she was in the right. But the fact is that she, and Ross before her, put up a sustained resistance to Chrissie’s legitimate claim.

[55] I do not accept Ms Grant’s submissions that I can use the Court’s equitable powers to grant the right of way over Chrissie’s land. To do so would be to read a limitation into Chrissie’s right to elect the 10 acres that is unwarranted. However, given the difficulties in accessing the rear of Lot 2 it may be that the land is effectively landlocked and so amenable to an application under s 327 of the Property Law Act 2007.¹⁶ That is not, however, what is before me in this proceeding.

Removal of items from Lot 1

[56] Chrissie complains that a number of items that are properly to be viewed as fixtures on the land have been removed from Lot 1 and should either be reinstated or compensated for. She submits that Maria and Vicky’s removal of the items was a breach of her rights under the judgment ordering specific performance and a breach of Maria and Vicky’s undertakings to the Court and Chrissie that they would

_{maintain Lot 1 and the buildings on it.}

¹⁶ The provisions relating to landlocked land are contained in ss 326-331 of the Property Law Act

2007.

Legal principles

[57] Fixtures are chattels annexed to land. A chattel that has become a fixture effectively becomes part of the land on which it is situated, so that when the land is sold the fixture is sold with it.¹⁷ Where a chattel is annexed to the land to any extent, the prima facie position is that it is a fixture and the onus is then on the person claiming that the chattel has remained a chattel to show that is the case.¹⁸ The distinction between chattels and fixtures can be difficult to discern, but it is often said that the two main indicators are the degree and object of annexation.¹⁹ Each case will depend on its particular facts and a commonsense approach, consistent with the broad test, must be taken in considering the indicators.²⁰

Gates

[58] Chrissie asserts that six gates, including gudgeons, hinge straps, bolts and latches, have been removed from the fencing to which they were attached at the driveway across the bottom of the north-west corner near Bethells Road and from other parts of Lot 1. In fact, it seems that there were only five gates on Lot 1. At the trial a contractor, Mr Atchison, gave evidence of five gates at $125 per gate being supplied with $350 of labour in maintenance. In her evidence in this application Vicky said that only five gates were on Lot 1 and the sixth was on Lot 2. I proceed on the basis that there are only five gates in issue.

[59] Vicky confirmed that the five gates to which Mr Atchison referred in his evidence were ones that she had moved together with one further gate from the driveway. She explained that the two gates at the beginning of the driveway were taken further up and positioned nearer her house for security reasons. Other gates were moved from time to time to accommodate filming that is sometimes undertaken

_{on the land.}

¹⁷ _{Auckland City Council v Ports of Auckland Ltd [2000] NZCA 190; [2000] 3 NZLR 614 (CA) at [72].}

¹⁸ _{Lockwood Buildings Ltd v Trust Bank Canterbury Ltd [1995] 1 NZLR 22 (CA) at 28.}

¹⁹ _{Auckland City Council v Ports of Auckland Ltd, above n 16, at [72].}

²⁰ At [72].

[60] For Chrissie, Mr Thompson relied on the decision in Cockrell v Ward,²¹ which is factually similar. The case contains a discussion of whether fencing and its constituent parts should be seen as chattels or fixtures:²²

So far as fencing is concerned, that would seem as a matter of commonsense to be properly regarded as a fixture. There is a degree of annexation to the land. It is not plausible to suggest on an objective basis that the individual components of the fences were regarded as continuing to retain their individual character as chattels after they were built into the fence structure. As well, fences are more logically to be viewed as items that improve the land and which are left behind by the vendor of the farm because they are essential to the continuing operation of the land as a farm.

[61] Ms Grant submitted that those comments do not apply in this case due to the particular way in which these gates were used. First, she said that the degree of annexation of gates hanging in the air attached to gudgeons is slight. Second, she said the evidence in this case shows the gates were intended all along to remain as chattels, because the gates and the fences to which they were attached were regularly moved to re-house stock on the land. Therefore this case can be distinguished from Cockrell v Ward where fences were installed to create permanent paddocks. Ms Grant pointed out that the property in this case does not operate as a farm and Vicky has simply created paddocks where they were needed.

[62] I find that the gates were fixtures and should not have been removed. The fences, which are sufficiently attached to the land to themselves be fixtures, have remained on Lot 1 and I agree with Mr Thompson that it is not sensible to say that gates forming part of a fence are somehow different and distinguishable from the rest of the fence, and are removable as chattels. Removing gates destroys the character and function of a fence.

The water tank

[63] A large plastic water tank had been located close to the house on Lot 1. The evidence indicates that this was not the primary source of water to the house; that comes from nearby Lake Kawaupaka. Unchallenged evidence from Maria was that

_{she had installed the water tank and associated spouting in 2012 to provide water for}

²¹ _{Cockrell v Ward [2013] NZHC 2368.}

²² At [42].

the laundry shed. The laundry shed was accepted as having belonged to Maria and not being a fixture and Chrissie’s claim to the water tank is resisted on the basis that, not only was the tank not affixed to the ground, but it was in fact connected by the spouting to the laundry shed. Maria submits that as part of a chattel, the tank is itself a chattel. However, the tank was filled from rainwater collected on the house and piped across the lawn. In addition, Maria acknowledged that a pipe fed back from the tank to the house, providing a supply of fresh, drinkable water (the water from Lake Kawaupaka being variable in quality).

[64] Mitchell Rickard, Chrissie’s son, provided an affidavit (unchallenged) describing markings on the wall inside the house distinguishing between a “lake water” tap and other taps connected to the water tank from which fresh drinkable water was always available. His affidavit also set out how he had helped dig the trench to lay the piping for rainwater collection from the house to the tank. He described the downpipe connecting the house to the water tank.

[65] I consider that the water tank, having been connected to the house through piping from which it drew and supplied water, was sufficiently affixed to the house to become part of it and, consequently, part of Lot 1. It should not have been removed.

The wood-burner fireplace

[66] A wood-burner fireplace had been located in the sitting room of the house. Maria removed that. Although she described the removal as simply lifting the wood- burner off the floor and carrying it out of the house, she made no mention of the fact that removal of the wood-burner also involved removing the chimney, which left a hole in the ceiling. Maria had taped plastic around the top exterior portion of the chimney that remained.

[67] Maria’s explanation for removing it was not, in fact, because she regarded it as a chattel but because of concerns over whether the house would be insured in its vacant state, given that the fireplace was not permitted. She said in her affidavit that she removed the fireplace to ensure that future tenants would be safe and the house would remain insured following her leaving. I do not accept that explanation.

However, the insurability of the house and the safety of the fireplace were matters for Chrissie as the owner. In any event, on Mitchell Rickard’s unchallenged evidence, Maria knew that it was Mitchell who was planning to move into the house after her. So suggestions about concern over tenants are disingenuous. The fireplace was unquestionably a fixture. Removing it left a hole in the ceiling with potential exposure to the elements, the only protection from which was the plastic taped to the chimney top.

Rental for the house

[68] Under the original order for specific performance Chrissie was entitled to a conveyance of the subject area by 20 January 2014. Vicky and Maria applied for a stay of execution of the order. On 18 February 2014 I made an order by consent staying the judgment on the condition that certain undertakings were honoured. They included that:

(c) Maria Bethell is permitted to occupy the white house and curtilage and pay no rental unless and until a judgment is issued by the Court of Appeal the effect of which is that Chrissie Bethell is entitled to occupation or ownership of the proposed Lot 1, in which case Maria undertakes to pay rent from 20 March 2014 at the amount agreed between two registered local real estate agents, one appointed by each of the defendants and the plaintiff. Failing agreement between the real estate agents, the rental is to be fixed at the mid-point between the two. In fixing the rental, the agents shall have regard to:

(i) The costs of maintaining Lot 1 and Maria’s house and curtilage and ancillary costs such as rates, maintenance, insurance and water that would otherwise be provided by a landlord;

(ii) That the sleep-out and laundry are not landlord’s fixtures;

(iii) The access arrangements that existed over the relevant period;

...

(f) Vicky Bethell and Maria Bethell undertake to maintain the proposed Lot 1 and the land and buildings thereon pending the Court of Appeal’s judgment and if the judgment is adverse to them and requires transfer of all or some of Lot 1 pending transfer to Chrissie Bethell.

[69] It is common ground that Maria has not paid any rent for the period between

20 March and 11 September 2014, when she vacated the property. Efforts by Chrissie prior to the release of the Court of Appeal’s judgment to agree upon a weekly rental sum were resisted on the grounds that there was no need to settle the rent until the Court of Appeal issued a judgment in Chrissie’s favour.

[70] Following the Court of Appeal’s decision, initially released on 5 September

2014, Maria obtained a rental appraisal from a Ray White agent which put the rental at $250-$275 per week (its “appalling access” contributing to the relatively low rental figure). The real estate agent Chrissie had previously consulted is no longer available and, at the date of hearing, she did not have further evidence. In those circumstances I fix the rent payable at the mid-point of the range suggested by Maria’s agent, namely $262.50.

[71] I do not accept Ms Grant’s submission that the costs of maintaining Lot 1 should be offset against the rent owed. The terms of the stay meant that the level of rent was to be determined with those costs in mind, and Maria’s affidavit discloses that her real estate agent assessed the rental on that basis.

Summary and result

[72] I have concluded that:

(a) The order for specific performance required Vicky to take steps to facilitate the subdivision of Lot 1 so that it comprised 10 acres or

4.047 hectares. The lodging of the survey plan based on the scheme plan did not comply with the terms of the order for specific performance.

(b) I have the jurisdiction to make further directions so as to ensure compliance with the order. The Court of Appeal decision does not preclude that and nor do the terms in which the original order was made.

(c) There is no equitable basis on which to amend the order in the ways sought by Vicky and Maria.

[73] I make the following orders:

(a) Victoria Bethell is to take all steps necessary, including signing a revised survey plan for the purposes of s 223 of the Resource Management Act 1991, to convey to Christine Bethell Lot 1 of CT NA6B/653 as approved for subdivision in the decision of the Waitakere City Council dated 10 May 2007 in accordance with the proposed plan annexed as CAB8.1 to the affidavit of the plaintiff sworn on 30 January 2015, being a plan for Lot 1 encompassing 10 acres or such other plan or amended plan as the plaintiff may elect, subject to the approval of the Court.

(b) Victoria Bethell is to take whatever other steps are necessary as directed by the Court to finalise and transfer Lot 1 to the plaintiff, including if necessary, preparing a fresh resource consent if required by the Council.

(c) Victoria Bethell is to pay the costs of the steps at (a) and (b).

(d) Victoria Bethell is to return the five gates removed from Lot 1 and pay reasonable costs of re-attaching them to the fences.

(e) Maria Bethell is to return the water tank to its original position on Lot

1 and to pay for the reasonable costs of reinstating the connection of the tank to the house.

(f) Maria Bethell is to return the wood-burner stove to the house on Lot 1 and pay the reasonable costs of reinstating it.

(g) Maria Bethell is to pay Christine Bethell rent at the rate of $262.50 per week for the week beginning on 20 March 2014 and ending on

11 September 2014.

Costs

[74] Chrissie seeks increased or indemnity costs for what she describes as Vicky’s “contumacious and contumelious disregard” of Chrissie’s rights, and for breaches of Vicky’s undertakings to the Court. However, I have found that Vicky acted honestly when lodging the survey plan based on the original scheme plan, and the issues over the fixtures are of a minor nature. I do not therefore think that this is a case in which increased or indemnity costs are appropriate. Costs are to be paid by Vicky and Maria on a 2B basis.

[75] Chrissie submits also that there are unresolved costs from the interlocutory application to stay enforcement of the judgment. This application was brought by Vicky and Maria and I made orders by consent. Costs on the interlocutory

_{application will lie where they fall.}

P Courtney J