Department of Conservation within rights on Memorandum of Transfer for land easement agreement
Agreement for Sale and Purchase between private landowner and Crown—creation of equitable easement—registered Memorandum of Transfer creates legal easement but excludes reference to ‘members of the public’ referred to in equitable easement—whether conduct of Department of Conservation was reasonable—Ombudsman could not assist—effect of Court of Appeal decision
A complaint was received about the action of the Department of Conservation entering into an agreement with a private landowner and the territorial local authority for the district. The agreement provided, inter alia, for the installation of a locked gate at the entrance to a right-of-way over private land giving access to the coastline, thereby blocking vehicular access by members of the public to the unformed legal road along the coastline.
The right-of-way was created pursuant to a Memorandum of Agreement dated 25 March 1970 (‘the 1970 Agreement’) between a former owner of the land and the Crown under which certain parts of the land were sold to the Crown. Clause 8 of this agreement also provided that the vendor: ‘... shall grant to the Purchaser, her servants, agents, workmen, contractors and members of the public, a full, free uninterrupted and unrestricted right, liberty and privilege from time to time and at all times by day and by night at their will and pleasure to go, pass and repass on foot or by vehicle over and along the said right of way to the end and intent that the land shown ...will be forever subject to the said rights as and in the nature of an easement’.
Pursuant to the 1970 Agreement, a Memorandum of Transfer was executed on 12 January 1977. This transferred the land sold under the 1970 Agreement to the Crown but in respect of the right of way created under clause 8, referred to the ‘Transfer and Grant’ to the Crown and her ‘servants, agents, workmen and all persons having business with her’. There was no reference made to ‘members of the public’ as there was in clause 8 of the 1970 Agreement.
On 31 July 1998, an agreement was entered into between the Crown, the territorial local authority for the district and the then owner of the land. Clauses 14 and 15 of this agreement provided as follows:
The parties agree that the easement shown as ‘D’ on DP59276 will be available as a carpark for the public wishing to access the coastline at this point. The Crown authorises the Owner to install a locked gate on the dogleg portion of this easement to prevent unauthorised vehicle access to the sea. The Owner will provide the Crown with a key to any lock on this gate. The Crown will install a stile adjacent to this gate for pedestrian access. The parties acknowledge that the within agreement does not replace the provisions of the existing easements or the Crown’s and the public’s existing access rights to the public land along the coastline.
Under Clause 8 of the 1970 Agreement the vendor granted a right-of-way by foot or vehicle to ‘members of the public’ and also to the Crown’s servants, agents, workmen and contractors. Although the 1970 Agreement created an equitable right-of-way for ‘members of the public’, this did not become a registered right-of-way when the 1977 Memorandum of Transfer was registered under the Land Transfer Act, as it did for the Crown and ‘her servants, agents, workmen and visitors and all persons having business with her’.
Section 62 of the Land Transfer Act 1952 provides that:
Notwithstanding the existence in any other person of any estate or interest, whether derived by grant from the Crown or otherwise, which but for this Act might be held to be paramount or to have priority, [but subject to the provisions of Part 1 of the Land Transfer Amendment Act 1963], the registered proprietor of land or of any estate or interest in land under the provisions of this Act, shall, except in case of fraud, hold the same subject to such encumbrances, liens, estates, or interests as may be notified on the folium of the register constituted by the grant or certificate of title of the land, but absolutely free from all other encumbrances, liens, estates or interests whatsoever, - ...
(b) Except so far as regards the omission or mis-description of any right of way or other easement created in or existing upon any land.’
In Sutton and Another v O’Kane and Others  2 NZLR 304, the Court of Appeal held that:
Apart from the easement certificate procedure under s 90A of the Land Transfer Act 1952 the only way in which an easement can be created in terms of the Act is by a memorandum of transfer ...
In s 62(b) of the Land Transfer Act 1952 the expression ‘created in’ refers to an easement ‘created in’ a manner which is effective under the Act and does not include an equitable easement created subsequent to the servient tenement being brought under the Act.
Accordingly, the effect of the Court of Appeal’s decision in Sutton meant that any equitable easement (right-of-way) in respect of ‘members of the public’ which may have been created under the terms of the 1970 Agreement between the private land-owner and the Crown was not protected by section 62(b) of the Land Transfer Act. If this was so, then the decisions and actions of the Department of Conservation in entering into the 1998 agreement with the present landowner, which provided for the installation of the locked gate at the entrance to the legal right-of-way, could not be considered unreasonable as the Department had acted within the rights that the Crown acquired as transferee under the Memorandum of Transfer of 12 January 1977.
An Ombudsman does not have authority to determine questions of law or make a ruling on the interpretation or effect of the law. As a consequence, the complainant was advised to initiate proceedings in the appropriate Court if he wished to challenge the Department’s action in entering into the 1998 agreement. The matter could not be resolved in terms of the Ombudsmen Act 1975.
This case note is published under the authority of the Ombudsmen Rules 1989. It sets out an Ombudsman’s view on the facts of a particular case. It should not be taken as establishing any legal precedent that would bind an Ombudsman in future.