Section 62 of Law of Property Act 1925 — Riverside hotel enjoying mooring facility — Mooring located on island accessible by footbridge — Defendants selling hotel to claimant without mention of mooring facility — Claimant failing to exercise option to buy mooring and other island property — Defendants purporting to revoke right to use mooring — Whether such right passing to claimant under section 62 — Whether contrary intention to be gathered from option agreement and correspondence — Claim allowed
The defendants owned and operated an 18-bedroom hotel in Horning, Norfolk, which offered, inter alia, river moorings for guests arriving by boat. These were located on an island, and were accessed via a footbridge that spanned a backwater (the lagoon) running between the island and the bank upon which the hotel stood. Notices were posted in various places warning that the moorings and the bridge were for the exclusive use of hotel guests. On the island itself, the defendants owned, in addition to the river moorings, a bungalow, together with a further set of moorings located on the lagoon side of the island (the lagoon moorings), which were let from time to time to individual boat owners.
On 23 May 2001, the parties entered into an agreement (the sale agreement) for the sale of the hotel as a going concern to the claimant for £700,000. On the same day, they entered into a further agreement (the option agreement), whereby the claimant obtained an option, exercisable not later than 28 February 2002, to buy other property belonging to the defendants for a further £200,000. That property included “the land and bungalow abutting the Broads including the moorings and known as Noosa Sound as edged in red on the Plan attached”. Neither the sale agreement nor the subsequent conveyance of the hotel made any express reference to a mooring facility.
The claimant failed to exercise the option within the prescribed period. The defendants refused to extend the option and informed the claimant that hotel guests could no longer use the river moorings and footbridge. The claimant brought proceedings claiming that such use had been acquired by way of a grant to be implied by section 62 of the Law of Property Act 1925*. The defendants advanced various arguments to the contrary.
Held: The claim was allowed.
1. It was accepted that a right to moor boats to a mooring post and the right to place a notice or sign were established categories of easement: see Lancaster v Eve (1859) 5 CB (NS) 717 and Hoare v Metropolitan Board of Works (1874) LR 9 QB 296. It would have been otherwise if, as claimed by the defendants, the exercise of those rights were to deprive a defendant of the beneficial use of that part of his property over which the rights were claimed. However, the interference in the present case was minimal: Copeland v Greenhalf [1952] Ch 488 and Batchelor v Marlow (No 2) [2001] EWCA Civ 1051; (2001) 82 P&CR 36 distinguished.
2. The defendants’ main contention (relying upon Birmingham, Dudley & District Banking Co v Ross (1888) 38 Ch D 295 and Selby District Council v Samuel Smith Old Brewery (Tadcaster) Ltd [2001] 1 EGLR 71) was that the implication otherwise to be made under section 62 was displaced by an intention that no mooring rights were to be acquired unless and until the option was exercised. However, the burden of proving a contrary intention lay upon the defendants. No such intention could be inferred from the shared expectation that the ownership of both moorings would shortly pass to the claimant on the exercise of the option. Nor could such an intention be gathered from pre-completion correspondence, which referred to the status of the lagoon moorings pending such exercise.
3. There was no case for undoing the effect of section 62 by way of rectifying the conveyance: Clark v Barnes [1929] Ch 368 not followed.
* Editor’s note: Which, as judicially construed, can operate to convert certain rights and advantages into enduring easements: see Wright v Macadam [1949] 2 KB 744 (considered in the present case).
Mark Warwick (instructed by Lionel J Lewis & Co) appeared for the claimant; Nicholas Caddick (instructed by Nicholsons, of Lowestoft) appeared for the defendants.
Alan Cooklin, barrister
