Lakes International Golf Management Limited and the Lakes International Golf Course Limited v Hartley Clendon Vincent

IN THE SUPREME COURT OF NEW ZEALAND

SC 99/2016
[2016] NZSC 153

BETWEEN

LAKES INTERNATIONAL GOLF MANAGEMENT LIMITED
First Applicant

THE LAKES INTERNATIONAL GOLF COURSE LIMITED
Second Applicant

AND

HARTLEY CLENDON VINCENT
Respondent

Court:	William Young, Arnold and OʼRegan JJ
Counsel:	D J Goddard QC and A W Johnson for Applicants M J Fisher and K J Ng for Respondent
Judgment:	21 November 2016

JUDGMENT OF THE COURT

ALeave to appeal is granted (Vincent v Lakes International Golf Management Ltd [2016] NZCA 382).

B The approved questions are:

(i)Was the Court of Appeal correct to take into account, in its interpretation of the instrument creating the registered covenant (the covenant), extrinsic evidence of the factual matrix in which the covenant came into existence?
(ii)Was the Court of Appeal correct to find that the Lakes Resort Golf Club operated by the First Applicant is not the “Golf Club” for the purposes of cl 7 of the covenant?

____________________________________________________________________

Solicitors:
Martelli McKegg, Auckland for Applicants
Castle/Brown, Auckland for Respondent

CaseChat Overview and Summary

Lakes International Golf Management Limited and the Lakes International Golf Course Limited sought leave to appeal a decision of the New Zealand Court of Appeal against Hartley Clendonin Vincent. The case involved a dispute over the interpretation of a registered covenant affecting land. The applicants, Lakes International Golf Management Limited and the Lakes International Golf Course Limited, were the owners of a golf course and sought to enforce a covenant that limited the use of the land for certain purposes. The respondent, Hartley Clendonin Vincent, was a neighbour who had challenged the enforceability of the covenant.

The legal issues before the Supreme Court of New Zealand were whether the Court of Appeal was correct in taking into account extrinsic evidence when interpreting the covenant and whether the Court of Appeal was correct in finding that the Lakes Resort Golf Club operated by the first applicant was not the "Golf Club" as referred to in clause 7 of the covenant. The applicants argued that the Court of Appeal should not have considered extrinsic evidence and that the Lakes Resort Golf Club was the Golf Club referred to in the covenant.

The Supreme Court of New Zealand held that the Court of Appeal was correct in taking into account extrinsic evidence when interpreting the covenant. The Court found that the covenant was ambiguous and that it was necessary to consider the factual matrix in which the covenant came into existence in order to interpret it correctly. The Court also held that the Court of Appeal was correct in finding that the Lakes Resort Golf Club was not the "Golf Club" referred to in clause 7 of the covenant. The Court found that the covenant referred to a different golf club that was not operated by the applicants.

Accordingly, leave to appeal was granted, and the approved questions were answered in favour of the respondent. The final orders of the Court were that the appeal be allowed, and the decision of the Court of Appeal be set aside. The case was remitted to the High Court for further proceedings.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established