Cleveland Petroleum Company Ltd v Dartstone Ltd

JurisdictionEngland & Wales
JudgeTHE MASTER OF THE ROLLS,LORD JUSTICE RUSSELL,LORD JUSTICE SALMON
Judgment Date26 November 1968
Judgment citation (vLex)[1968] EWCA Civ J1126-3
CourtCourt of Appeal (Civil Division)
Date26 November 1968
Between
Cleveland Petroleum Company Limited
Plaintiffs, Respondents
and
Dartstone Limited and James Arthur Gregory
Defendants Appellants

[1968] EWCA Civ J1126-3

Before

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.

THE MASTER OF THE ROLLS
1

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.

2

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.

3

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.

4

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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13 cases
  • Irish Shell Ltd v Elm Motors Ltd
    • Ireland
    • Supreme Court
    • 1 January 1984
    ...Esso Petroleum Co. Ltd. v. Harper's Garage (Stourport) Ltd.ELR [1968] A.C. 269; Cleveland Petroleum Co. Ltd. v. Dartstone Ltd.WLR [1969] 1 W.L.R. 116 and Amoco Australiav. Rocca Bros.ELR [1975] A.C. 562 considered. 2. That the restrictive covenants on the part of the defendants in the lease......
  • Lobb (Alec) (Garages) Ltd v Total Oil (Great Britain) Ltd
    • United Kingdom
    • Court of Appeal (Civil Division)
    • 8 November 1984
    ... ... 2 In 1968 a Company, Alec Lobb (Garages) Ltd. ("the Company") which was the first plaintiff in ... In Esso Petroleum Co. Ltd. v. Harper's Garage (Stourport) Ltd ... (1969) AC 269 , it was ... that the facts in this case were very different from either the Cleveland case or the Harper case. In Esso Petroleum Co. Ltd. v. Harpers Garage ... ...
  • CA v Secretary of State for the Home Department
    • United Kingdom
    • Queen's Bench Division
    • 20 July 2004
    ... ... Mr A Nicol QC and Mr M Henderson instructed by Bartram & Company, for the Claimant; ... Ms J Anderson instructed by the Treasury ... ...
  • Queensland Co-Operative Milling Association v Pamag Pty Ltd
    • Australia
    • High Court
    • Invalid date
  • Request a trial to view additional results
3 books & journal articles
  • Table of Cases
    • United Kingdom
    • Wildy Simmonds & Hill Restrictions on the Use of Land Preliminary Sections
    • 30 August 2016
    ...198 EG 583, DC 387 Cleaver v Bacon (1887) 4 TLR 27 288 Clegg v Hands (1890) 44 Ch D 503 243 Cleveland Petroleum Co Ltd v Dartstone Ltd [1969] 1 WLR 116, [1968] 1 All ER 201, 20 P & CR 235, CA 252 Coastal Partnerships Ltd v Beddy [2007] EWHC 387 (Ch) 281 Cole v Davies-Gilbert [2007] EWCA......
  • Enforceability of the Burden of a Freehold Covenant
    • United Kingdom
    • Wildy Simmonds & Hill Restrictions on the Use of Land Part IV. Restrictive covenants (freehold land)
    • 30 August 2016
    ...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......
  • Illegality
    • Canada
    • Irwin Books The Law of Contracts. Third Edition Vitiating Factors
    • 4 August 2020
    ...(3d) 193 (Ont CA), leave to appeal to SCC refused (1976), 65 DLR (3d) 193n (SCC). See also Cleveland Petroleum Co v Dartstone Ltd , [1969] 1 All ER 201 (CA). 190 Above note 154. See also Clifford Davis Management Ltd v WEA Records Ltd , [1975] 1 All ER 237 (CA). Illegality 535 “retain-or-tr......

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