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Creation of easements - a step in the right direction?

A landmark decision by the Supreme Court in (Regency Villas Title Ltd and others v Diamond Resorts Ltd and others ) has concluded that a right to use sporting and recreational facilities, long-recognised as being of personal benefit, are capable of being the subject of an easement binding land.

The Facts

The Broome Park estate was split when Elham House and surrounding land was sold. The retained land, being the rest of Broome Park and the Mansion House, was retained and included a number of leisure facilities including a golf course, outdoor pool and racquet courts. There was a complex ownership structure, including re-acquisitions and associated entities. Timeshare apartments were developed on both Elham House and the retained Broome Park Mansion House land. Elham House was held on trust for its timeshare owners who benefited, via the 1981 transfer, from the right "to use the swimming pool, golf course, squash courts, tennis courts. The ground and basement floor of Broome Park Mansion House, gardens and any other sporting or recreational facilities".

When the 1981 transfer was entered into, the owner of Broome Park Mansion House intended that the public would also use the facilities, subject to payment of a membership fee. They did not covenant to maintain the facilities and were under no obligation to do so. The facilities were not successful as a public facility and over time they became rather neglected. The Elham House timeshare owners made voluntary payments which went towards maintaining the facilities.

The issues

Were the four essential characteristics of an easement present and were the owners entitled to compensation in relation to the money contributed? To answer this question, the Court had to decide whether the rules in re Ellenborough Park [1956] applied and if so, decide whether the right of recreation and amusement was of benefit to the Elham House properties rather than just the owners.

The decision

It is clear that two of the four criteria were met: there was dominant and servient land in different ownership. The focus was on the other two characteristics. In deciding whether the easement claimed was of genuine benefit to the land rather than its owners, the Court paid particular attention to the timeshare element of Elham House. As the use of the properties were said to be for recreational purposes, the Court decided that the facilities offer practical benefit to the land and fulfill this criteria. 

The second focus was the fourth characteristic: the right must be "capable of forming the subject-matter of a grant". The Court decided that the wording of the right in the 1981 transfer was sufficiently clear. Those representing Broome Park Mansion House argued that the subject matter failed on "mere passivity"; they would have a positive obligation to provide the facilities. This argument failed with the Court deciding that the Elham House owners could "step-in" to maintain and keep up the facilities if necessary, by mowing lawns and filling pools. They also said that the right only extended to the facilities that were present from time to time and there is therefore no ongoing obligation to continue to provide a set list of facilities. Broome Park Mansion House also sought to raise ouster, which is the principle that a right which effectively deprives the owner of the burdened land from their own reasonable use of that land. Ouster is often relied on in parking cases but was dismissed in this case, with the facilities capable of being kept in acceptable condition using the "step-in" rights, rather than Elham House having to take possession and exclude the owners.

The Court, with Lord Carnwith dissenting, upheld the decision of both lower Courts that right to use the facilities, as set out in the 1981 transfer, was capable of forming an easement.  

Comment

While the decision confirms how easements are created, it breaks new ground by highlighting both the growing recognition of the benefits of sporting and recreational activities and the importance of the intention sitting behind property ownership.  It is an interesting decision which should remind property owners to consider potential future costs and obligations when granting rights. This is particularly the case where the nature of the easement is linked to the purpose of property ownership, demonstrated in this case by the link between the leisure facilities and timeshare properties.

In this case, Broome Park Mansion House has effectively been burdened with the cost of facilitating the easement. This approach is not supported by the Law Commission, nor was it agreed in re Ellenborough Park [1956], the leading case on the creation of easements. Critics have long sought clarification on the characteristics required to create an easement and it is likely that this decision has further complicated, rather than simplified, the law of easements.  

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