Cleveland Petroleum Company Ltd v Dartstone Ltd
| Jurisdiction | England & Wales |
| Judge | THE MASTER OF THE ROLLS,LORD JUSTICE RUSSELL,LORD JUSTICE SALMON |
| Judgment Date | 26 November 1968 |
| Judgment citation (vLex) | [1968] EWCA Civ J1126-3 |
| Court | Court of Appeal (Civil Division) |
| Date | 26 November 1968 |
[1968] EWCA Civ J1126-3
The Master of the Rolls (Lord Denning)
Lord Justice Russell and
Lord Justice Salmon
In The Supreme Court of Judicature
Court of Appeal
Appeal by Defendants from the Order of Mr. Justice Eveleigh of 1st November 1968
Mr. RAYMOND WALTON, Q.C., and Mr. MARTIN BUCKLEY (instructed by Messrs. Parker Thomas & Co.) appeared on behalf of the Appellant Defendants.
Mr. A.P. LEGGATT (instructed by Messrs. Bower Cotton & Bower) appeared on behalf of the Respondent Plaintiffs.
This case concerns a garage and petrol station called The County Oak Service Station, at Crawley in Sussex. Mr. Sainsbury was the owner in fee simple. On the 1st July, 1960, there were three separate transactions! First, Mr. Sainsbury granted a lease of the entire premises to the Cleveland Petroleum Co, Ltd, for 25 years, from 1st July, 1960. Cleveland paid him £50,000 premium and agreed also to pay a nominal rent of £10 a year. Second, Cleveland granted an under-lease of the premises to a company called The County Oak Service Station Ltd. That company was one in which Mr. Sainsbury had a predominant interest. The under-lease was for 25 years, less 3 days from the 1st July, 1960, at a rent of £2,000 a year. In that under-lease there was this covenant tying the under-lessees to Cleveland: At all times to carry on the business of a petrol-filling station at the premises and not to store handle sell or distribute on or from the premises any motor fuels other than those supplied by the lessors." There was a provision that if Cleveland could not supply petrol the under-lessees could get if from Esso; and if Esso could not supply, they could get it from'somebody else, There was another covenant about lubricating oil, and a further covenant to keep the premises open to the public from 7 a.m. to 8 p.m.
The under-lessees, County Oak Service Station Ltd., duly carried on business in accordance with the covenants. They took all their petrol from Cleveland and paid their rent of £2,000 a year. Afterwards they assigned, with the consent of Cleveland, to another company; and that other company afterwards assigned, with Cleveland's assent, to a company called J.A. Gregory (Car Sales) Ltd. All those assignees compiled with the tie to Cleveland.
On the 30th August, 1968, the under-lessees assigned the under-lease to a company called Dartstone Ltd. A licence was granted by Cleveland for that assignment. Under the assignment Dartstone Ltd. undertook to pay the rent and "observe and perform the covenants and conditions" on the part of the under-lesseesContained in the under-lease. Mr. Gregory, who was the dominant shareholder in Dartstone Ltd., went surety for the company.
The writ was hardly dry on that assignment when Dartstone Ltd. challenged the covenant tying the under-lessee to Cleveland. On the 30th September, 1968, solicitors on behalf of Dartstone Ltd. wrote saying that they had been considering the validity of the ties, and they were advised that they were void. Thereupon Cleveland issued a writ against Dartstone Ltd, for an Injunction to restrain thee from breaking the agreement by storing, handling, selling or distributing on or from The County Oak Service Station any motor fuels other than Cleveland. Mr. Justice Eveleigh granted an interim injunction until trial. The under-lessees, Dartstone Ltd., with Mr. Gregory, appeal to this Court. They say that prima facie the covenants in the...
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Irish Shell Ltd v Elm Motors Ltd
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Enforceability of the Burden of a Freehold Covenant
...sense having had no previous right to be on the land. The majority view was applied in Cleveland Petroleum Co Ltd v Dartstone Ltd [1969] 1 WLR 116 and Amoco Australia Pty Ltd v Rocca Bros Motor Engineering Co Pty Ltd [1975] AC 561. In Alec Lobb (Garages) Ltd v Total Oil Great Britain Ltd [1......
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Illegality
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