Contract – Construction – Boathouse – Claimants seeking declaratory relief as to ownership of boathouse operated by defendant – Whether boathouse becoming part of land owned by Crown – Whether contract precluding defendant from dismantling and removing boathouse – Whether claimants estopped from denying defendant’s ownership – Claim allowed
A dispute arose concerning the ownership of a boathouse and jetties located on the Serpentine Lake, Hyde Park, London. The freehold land was owned by the Crown. The first claimant was a charity incorporated in 2016 to carry out functions including the management of Hyde Park.
Since 1998, the defendant had operated boating facilities at the Serpentine for the public. By a concession contract in December 2004, made with the second claimant secretary of state, the defendant agreed to replace the existing boathouse and jetties with a new boathouse.
The original contract period of fifteen years was extended to November 2020 but thereafter the contract expired. The defendant’s concession was not renewed, although it was extended on an interim basis.
The claimants sought declaratory relief as to the ownership of the boathouse, together with orders to restrain the defendant from continuing to trade from the boathouse and from removing the boathouse from Hyde Park. As it was constructed to form part of the land, it belonged to the Crown and the defendant had no right to remove the boathouse on expiry of its interim concession rights in October 2021.
The defendant argued that it retained ownership of the boathouse which remained a chattel and was not a fixture to the land; alternatively, the claimants were estopped from denying its ownership of that part of the boathouse which could be removed. It was designed to be assembled in parts at the lakeside and subsequently dismantled and was intended to be removeable in the event the concession ended by effluxion of time or otherwise.
Held: The claim was allowed.
(1) On the evidence, the boathouse comprised both the superstructure and substructure of the building. The method of construction adopted, materials used and the extent to which it had been anchored to the land, partially cut into the sloping bank of the Serpentine, indicated that the substructure and superstructure elements of the boathouse were built to be permanent and immobile.
(2) An object that was brought onto land might be classified as: (a) a chattel; (b) a fixture; or (c) part and parcel of the land itself. Objects in categories (b) and (c) were treated as part of the land: Woodfall on Landlord and Tenant (Vol 1), para 13.131.
It was a question of fact whether a particular object fell within one of those categories. The main factors were the degree of annexation to the land and the object of the annexation. Where an item had been attached or connected in some way to the land, there was a rebuttable presumption that it had become a fixture: Holland v Hodgson (1872) LR 7 CP 328.
Where the structure was annexed to the land but potentially removable, it would be treated as part of the land if the purpose for which it was annexed was the permanent and substantial improvement of the land; but it would be treated as a chattel if the purpose for which it was annexed was temporary or for the more complete enjoyment and use of it as a chattel. The test as to the degree and purpose of such annexation was an objective one; it was not determined by the subjective intention of the parties or any contractual arrangements between them: Elitestone Ltd v Morris [1997] 2 EGLR 115 applied. Melluish (HMIT) v BMI (No 3) Ltd [1996] AC 454 followed. Webb v Frank Bevis Ltd [1940] 1 All ER 247 and Wessex Reserve Forces and Cadets Association v White [2006] 1 EGLR 56 considered.
(3) In the present case, having determined that the boathouse comprised both the superstructure and the substructure, it followed that the degree of annexation was such that the structure was permanently fixed to, and was part of, the land. The purpose for which the boathouse was constructed by the Serpentine was the permanent and substantial improvement of the land. It was inextricably linked to the boating concession operated by the defendant on behalf of the claimants, a service that could only be operated from the lakeside.
Therefore, the boathouse fell within the definition of the premises under the contract and the defendant had no proprietary or contractual right to remove any part of it, including the building superstructure.
(4) The court rejected the defendant’s case that any estoppel arose in this case. Although promissory estoppel might arise in the absence of an express statement by A, a court would require clear evidence before finding that A impliedly encouraged B. The general position was that mere silence and inaction by A could not found a promissory estoppel, as A’s failure to act, if capable of communicating anything, would generally be open to differing reasonable interpretations, at least one of which would be inconsistent with A’s right not being enforced.
There were two exceptions to that general rule. First, if A was under a duty to disclose the existence of a particular matter giving rise to a right in A’s favour, A’s failure to do so might possibly support a promissory estoppel by leading B reasonably to believe that A did not have that right. Secondly, if A stood by, knowing that B had a mistaken belief as to B’s current legal rights and failed to take a reasonably available opportunity to assert A’s inconsistent right, the doctrine of acquiescence might then apply to prevent A’s later asserting that right: Snell’s Equity (34th Edition), paragraph 12-24.
On the evidence, nothing was said by any of the parties as to ownership of the boathouse or any right to remove it on expiry of the contract. The claimants’ silence did not give rise to estoppel. They were not under any duty to disclose the Crown’s ownership of the land which was a matter of public record. Therefore, the first exception did not arise. There was no evidence that, if the defendant were under a mistaken belief as to ownership in the boathouse, such belief was communicated to the claimants. Therefore, the second exception did not arise.
In the absence of any express statement from the claimants indicating that property in the boathouse would be transferred to the defendant, it was not reasonable for the defendant to assume, or believe that it would own the boathouse; and it was not unconscionable for the claimants to rely on their rights of ownership and occupation.
Camilla Chorfi (instructed by Bates Wells) appeared for the claimants; Kevin Leigh (instructed by RIAA Barker Gillette (UK) LLP) appeared for the defendant.
Eileen O’Grady, barrister
Click here to read a transcript of Royal Parks Ltd and others v Bluebird Boats Ltd
