If you own land, you may be affected by a right of way.  A right of way gives rights to use another landowner’s land for access purposes.  You may have rights to use another landowner’s land to access your property, or your land may be subject to rights of access for someone else.  You can usually ascertain from looking at the record of title whether the property you own has the benefit of, or is subject to, a right of way. This is because the right of way will generally be recorded in an easement that will be registered against the record of title for the affected properties.

 

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However, in some instances, a right of way may not be registered against the title. The recent case of Kinara Trustee Ltd (Kinara) v Infinity Enterprises NZ Ltd (Infinity) [2019] NZHC 1526 highlights the potential pitfalls of an unregistered right of way.

In Kinara v Infinity, Kinara claimed it had the right to use an unregistered right of way over land owned by Infinity.  The right of way was not a registered easement.  Kinara claimed it was either an equitable easement or that Infinity was estopped from denying its equitable right to use the access. Infinity refused to recognise Kinara’s right to use the disputed access. 

Kinara acquired its land in 2007 and since then Infinity had consented to Kinara using the access and had never objected to that use.  Kinara undertook a significant retailing commercial development on its property and claimed that it had done so based on its access rights over the disputed area.  Kinara sought an order requiring Infinity to register an easement of right of way over the relevant area. 

The court held firstly that there was no equitable easement as the tests for an equitable easement were not met. However, Kinara’s claim succeeded on the basis of equitable estoppel and that Infinity was estopped from denying Kinara’s right of use of the access.  The court ordered that Infinity must register the easement on its title. 

Despite Infinity’s knowledge that the right of way was being used by Kinara without a registered easement, Infinity did nothing for ten years to restrain Kinara from using the right of way.  The court held that Infinity’s silence contributed to Kinara’s mistaken belief that it had the right to use the right of way.  The court also took the view that Infinity should have raised its objection to the use of the right of way before the building was complete – at the outset of the development or as soon as Infinity became aware of it.  It was apparently obvious from the building’s design that it would need to use the right of way access.

There are two important takeaway points from this case for both an owner of land subject to an unregistered right of way and for persons using such a right of way:

  1. If you own property subject to an unregistered right of way, this does not necessarily mean you can stop any informal use based on indefeasibility of title (i.e., based on the fact that the easement is not registered on the title). As an owner, you may need to formally object to that use or to make it clear that it is on the basis of a temporary licence that you can revoke at any time.  Otherwise you may run the risk of an estoppel claim requiring you grant a formal easement, potentially preventing your own future development of your property.
  2. If you have the benefit of an easement, or think you have the benefit of an easement, we highly recommend you ensure that the easement is registered. Even though in the above case Kinara was able to raise an argument in the court that the easement should be registered, this may not always be the case and a registered easement ensures your rights will be recognised by property owners without the expense and risk of a Court application to secure your access rights.

Please contact us for further advice if you have any concerns about the legality of easements on land you own or land you wish to purchase.

 

This article is current as at the date of publication and is only intended to provide general comments about the law. Harkness Henry accepts no responsibility for reliance by any person or organisation on the content of the article. Please contact the author of the article if you require specific advice about how the law applies to you. 


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