The recent Court of Appeal judgment in Thornley v Ford [2024] NZCA 154 considered what happens when the infrastructure for an easement is not located in the same place as it is recorded on the title plans. It is worth looking at the reasoning and what rights landowners have in these situations.

Background

An easement is a right to use another person’s land without ownership of that land. Common easements are rights of way, rights to drain or convey water, or to convey electricity.

This case concerned a right to convey water for use in irrigation. The pipe passed over land owned by Dr Ford for the benefit of land eventually acquired by Mr Thornley. Before the pipe was laid an easement was registered on the relevant titles and the easement area surveyed. However, after this was registered the pipes were laid outside of the easement area by mutual agreement, due to practical construction difficulties. Neither party appreciated that this changed their legal rights. The relationship between the neighbours deteriorated and the Court had to determine what rights Thornley had to use the rogue pipe.

Decision

One of the questions for the Court was whether this was a “misdescription” of the easement area. Did Thornley hold the rights described under the easement even though the pipe was in a different location?

The Court traced the history of the relevant legislation and held that he did not hold legal rights protected by the registered easement instrument, but he did hold a lesser equitable interest in Ford’s land. The Court said that where the position of services was changed and owners could have, but chose not to, register an easement variation on their titles, then this was not a misdescription and the formal rights under the easement did not apply. The reason an equitable interest is a lesser right is that it only binds the owner of the burdened land at the time the rights were agreed. In most cases, once the burdened land is sold this right is lost.

Commentary

While in most cases owners recognise the need to formally record a change in their property rights, as lawyers we do come across situations where legal arrangements are not well recorded. A lack of formality in this situation could affect rights to use crucial infrastructure and ultimately the value of property. For example, if a driveway changed paths outside the surveyed area due to land movement, the related easement should be varied. If it wasn’t, the benefitting owner may only have an equitable right to use the driveway, which could be lost on a sale of the burdened land.

One saving grace is that equitable easements are recognised as important enough to be protected by a caveat, provided the person with the benefit of the easement acts to register the caveat before the burdened land changes hands.

Easements are registered on many property titles in New Zealand, and it is important that they are accurately recorded. Wynn Williams can assist with any questions about your property rights and obligations.