Property purchasers beware! Rights of way: How to prevent neighbour warfare

A recent case has highlighted the importance of proper due diligence by purchasers in assessing legal title to a property and, more particularly, the effect of any right of way easement affecting the title.

Purchasers are often, understandably, more concerned with the clear-cut aspects of a purchase; the price, the condition of the building and its surroundings – perhaps there’s a lavish garden and a pool. But, as the Court in Cornes v Village Residential Ltd [2021] NZCA 216 has illustrated, purchasers should not so quickly disregard the legal details in their due diligence because if they do, especially when a right of way easement affects the title, it can result in costly, preventable neighbour warfare.

Cornes v Village Residential Ltd – The facts

The appellants, Mr Cornes and Ms Jones (“C”), owned a property in Havelock North, comprising a large back section including a strip of land extending to the road containing their driveway (“C’s Lot”). The defendant, Village Residential Limited (“VRL”), had purchased the neighboring property (“VRL’s Lot”), which sat in front of C’s Lot, and enjoyed the use of the driveway on C’s Lot pursuant to a right of way easement.

VRL decided to subdivide VRL’s Lot into 5 lots and the Council granted subdivision consent with various conditions, including that the driveway, which served both parties, required an upgrade and a new drainage sump installed within it to provide better stormwater management and reduce runoff.

C stringently opposed the driveway upgrade and the subdivision, indicating the development would erode the privacy and amenity value C had enjoyed. During the driveway construction process, C allegedly stood in the hole dug for the new drainage sump to prevent work proceeding and parked a car across the driveway to prevent VRL’s contractor from accessing the site. In the face of this strong objection, VRL resorted to applying for Court orders confirming it was entitled to upgrade the driveway.

The Court of Appeal’s decision

On appeal, the Court of Appeal determined whether VRL had the right to upgrade the driveway when the right of way easement only expressly allowed for repair, maintenance and upkeep of the driveway.

The Court noted the terms of the right of way easement, created by a memorandum of transfer dated in 1951, permitted VRL to have access over the driveway on C’s Lot, including vehicular access, “for whatever purpose [VRL’s Lot] may be lawfully used”. Nothing in the terms prohibited VRL from upgrading the driveway, if that was required to enable the lawful use of the right of way to access VRL’s Lot.

In discussing the relevant case law, the Court noted a grant of a right of way easement carries with it such ancillary rights as are reasonably necessary for the effective and reasonable exercise and enjoyment of the right of way. Even significant modifications to the burdened land (C’s Lot) by the owner of the dominant land (VRL) are allowed to facilitate the use of the right of way for purposes not anticipated at the time of the grant.

What’s the upshot for purchasers?

If you’re purchasing a property with a shared driveway, or there are any easements on the legal title, proceed with caution and ensure you obtain appropriate advice to understand your obligations and the potential for disputes. Although rights of way are generally in place to ensure legal access, there are often other aspects to these easements which can catch out unknowing purchasers down the line and cause catastrophic neighbour warfare. If you are weighing up a property purchase, contact Sarah, Jono, Amanda or Sean.