Halsall v Brizell

The parties and the building scheme

The summons concerned the construction of a building scheme entered into on August 19, 1851, by a large number of owners of properties in what had become known as Cressington Park, then within the City of Liverpool. On May 8, 1851, about 40 acres of land, which afterwards became Cressington Park, had been purchased for the sum of some £24,000, and that land was sold off in some 174 plots, some purchasers taking more than one plot.

The deed of August 19, 1851

On the occasion of each conveyance on sale the purchasers entered into a number of building covenants, and those covenants were repeated in the deed of August 19, 1851. The plots having been sold off, the roads and a promenade along a sea wall remained vested in the original purchasers, Okell and Jeffrey. The object of the deed was to declare trusts concerning the roads and the promenade for the benefit of the purchasers, and to provide for payment of the necessary expenses proportionately by the owners in respect of the upkeep and maintenance of the roads and promenade, of the sewers which had been placed under the road, and of the street lighting, which was by gas. The parties to the deed were a large number of owners of plots of the one part and Okell and Jeffrey of the other part. The deed contained elaborate provisions for the owners of the plots to meet and to decide what was an appropriate sum to be paid annually to defray the necessary expenses of the trustees, together with a number of restrictive covenants concerning building lines and restricting building to one dwelling-house on each plot.

The seventh covenant

By the seventh covenant each of the plot owners covenanted to contribute and pay a due and just proportion in respect of the plot or several plots of land and of the dwelling-house on each such plot, in regard to the costs and charges of keeping the roads in repair, of repairing the sea wall, promenade and lodge, and of maintaining the sewers. The covenant as to lighting was in different terms, the expense of lighting the roads with gas being contributed to and paid by the owners of such dwelling-houses as were for the time being erected, completed and fit for habitation, in equal shares. The owners or shareholders had power to make rules and regulations for the proper administration of the estate, and in particular for the purpose of agreeing and determining upon the expenses to be from time to time incurred.

The position at the date of the summons

To that day the sewers had not been taken over by the local authority, nor had the roads serving the park, all of which remained in the plaintiffs, who were the successors of the original trustees, Okell and Jeffrey. The street lighting had been taken over by the local authority, so that no question arose upon it.

The defendants' property and the resolution

The defendants' house, No. 22, Salisbury Road, had originally been sold in 1931 to their predecessor in title, who took the house on the terms of the deed of 1851. Under a declaration of 1928 the house might lawfully be divided into a number of tenancies, and the defendants had five flats in it. A resolution was passed in September, 1950, under which no more than three calls were to be made in respect of any one plot. Pursuant to that resolution calls were made upon the defendants. The call for 1954-1955 in respect of a single plot was £3, and the defendants were assessed for that year in the sum of £9.

The dispute

The defendants were willing to pay £3 in respect of the one plot, but denied the validity of the resolution purporting to make them liable to pay three calls in respect of one plot. Two questions arose: first, whether, in so far as the deed of 1851 purported to make the successors of the original contracting parties liable to pay calls, it was valid and enforceable at all; and secondly, whether, upon the true construction of the deed, the resolution passed in September, 1950, was a valid resolution.

Outcome

Upjohn J. held that the defendants could not be sued on the covenants contained in the deed, for at least three reasons: a positive covenant in the terms of the seventh covenant did not run with the land; the provisions with regard to the payment of calls infringed the rule against perpetuities; and it was conceded that the provision for distraining on failure to pay was not valid, a right to distrain being capable of annexation only to a rent-charge, which this was not. It was conceded, however, that it was ancient law that a man could not take benefit under a deed without subscribing to the obligations thereunder, for which his Lordship referred to the observation of Lord Cozens-Hardy M.R. in the argument in Elliston v. Reacher, citing Co. Litt. 230b. The defendants did desire to take the benefit of the deed: they had no right to use the sewers, which were vested in the plaintiffs, nor, apart from the deed, to use the roads of the park leading to their house, and they could rely neither on a way of necessity nor on prescription, because their predecessor in title had taken the house in 1931 on the terms of the deed of 1851, which bound him contractually to contribute a proper proportion of the expenses as a condition of being entitled to use the roads and sewers. They were therefore bound by the deed if they desired to take its benefits. On the second question, his Lordship held that the resolution could only properly be made if the method proposed was one whereby each owner of a plot was bound to contribute a due and just proportion. The whole of the document was concerned with the management of the roads and other amenities for the benefit of the owners of the plots as such, and the plot was the unit contemplated for assessment; a contribution could not be made to depend upon the user to which a particular proprietor put his plot, any more than upon the number of his children, servants or motor-cars. Accordingly the resolution, although passed bona fide, was not a proper resolution but was ultra vires and void, the deed not having empowered the meeting of the proprietors to exercise their discretion in that way. A declaration was made accordingly.