General Motors UK Ltd v The Manchester Ship Canal Company Ltd
| Jurisdiction | England & Wales |
| Judge | Judge Behrens |
| Judgment Date | 30 November 2016 |
| Neutral Citation | [2016] EWHC 2960 (Ch) |
| Docket Number | Case No: HC-2015-000920 |
| Court | Chancery Division |
| Date | 30 November 2016 |
[2016] EWHC 2960 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
The Rolls Building
7 Rolls Buildings
New Fetter Lane
London EC4 1NL
His Honour Judge Behrens sitting as a Judge of the High Court.
Case No: HC-2015-000920
William Norris QC, Simon EdwardsandDaniel Stedman Jones (instructed by Duane Morris) for the Claimant
Katharine Holland QC and Katie Helmore (instructed by Hill Dickinson LLP) for the Defendant
Hearing dates: 24 – 28 October 2016
Introduction
In 1962, the Manchester Ship Canal Co Ltd ("MSCC") granted Vauxhall Motors Ltd ("GM/Vauxhalls"), the right to discharge (inter alia) surface water from its plant into the Manchester Ship Canal ("the Canal").
MSCC is the owner of the Canal and GM's main manufacturing plant at Ellesmere Port adjoins MSCC's land and drains through it to the Canal.
The 1962 document granting the right is described as a Licence. The right was granted in perpetuity; it required Vauxhalls to pay an annual sum of £50 and contained provisions which entitled MSCC to terminate the right if the £50 was not paid.
It is not in dispute that the sum payable in October 2013 was not paid. It is equally not now in dispute that MSCC validly terminated the right in a letter dated 10 th March 2014. Although GM subsequently offered to pay the overdue sum MSCC refused to accept it.
Following the letter GM and MSCC entered into negotiations for the grant of a temporary new right. In those negotiations MSCC sought a very substantially increased annual sum. The negotiations reached an advanced stage but it is common ground that there was no concluded contract between the parties.
Shortly before concluding a contract GM decided to take external legal advice. As a result of that advice in March 2015 GM issued these proceedings in which initially it claimed that the termination was not valid. In the alternative it sought relief from forfeiture.
The claim was amended in August 2016. In the Amended Claim GM abandoned the suggestion that the termination was not valid. However, it added a new claim under the provisions of Manchester Ship Canal Act 1885 ("the 1885 Act"). It will, of course, be necessary to consider the 1885 Act in detail later in this judgment. In summary GM contends that it is entitled to the benefit of the 1885 Act as a successor to Richard Christopher Naylor. GM contends that if it is no longer permitted to discharge surface water into the Canal then MSCC will interfere with or prejudicially affect the passage or escape of drainage or floodwater from its land into the River Mersey and, accordingly, MSCC will be under an obligation to restore the discharge or make sufficient provision therefor to GM's reasonable satisfaction
MSCC seeks to defend the proceedings on a number of grounds. First, it contends that there is no power to grant relief from forfeiture. If there is power to grant relief it contends that GM is estopped from claiming relief from forfeiture relying on the negotiations as giving rise to an estoppel by representation and/or an estoppel by convention. It contends that, as a matter of discretion, this is not an appropriate case for relief. It denies that the 1885 Act assists GM.
If, contrary to its primary submission this is an appropriate case for relief, there are disputes as to the terms upon which relief should be granted. If this is not an appropriate case for relief there are further disputes as to the correct measure of damages payable to MSCC as a result of the acts of trespass.
The Manchester Ship Canal 1
The Manchester Ship Canal is a 36-mile-long inland waterway linking Manchester to the Irish Sea. Starting at the Mersey Estuary near Liverpool, it generally follows the original routes of the rivers Mersey and Irwell through Cheshire and Lancashire. Five sets of locks lift vessels about 60 feet up to Manchester, where the Canal's terminus was built.
The rivers Mersey and Irwell were first made navigable in the early 18th century. By the late 19th century the Mersey and Irwell Navigation had fallen into disrepair and was often unusable. In addition, Manchester's business community viewed the charges imposed by Liverpool's docks and the railway companies as excessive. A ship canal was therefore proposed as a way of giving ocean-going vessels direct access to Manchester. The region was suffering from the effects of the Long Depression and for the Canal's proponents, who argued that the scheme would boost competition and create jobs, the idea of a ship canal made sound economic sense. They initiated a public campaign to enlist support for the scheme, which was first presented to Parliament as a bill in 1882. Faced with stiff opposition from Liverpool, the Canal's supporters were unable to gain the necessary Act of Parliament to allow the scheme to go ahead until 1885.
Construction began in 1887; it took six years and cost £15 million (equivalent to about £1.65 billion in 2011). When the Canal opened in January 1894 it was the largest river navigation canal in the world, and enabled the newly created Port of Manchester to become Britain's third busiest port despite the city being about 40 miles inland. Changes to shipping methods and the growth of containerisation during the 1970s and '80s meant that many ships were now too big to use the Canal and traffic declined, resulting in the closure of the terminal docks at Salford. Although able to accommodate a range of vessels from coastal ships to inter-continental cargo liners, the Canal is not large enough for most modern vessels. By 2011 traffic had decreased from its peak in 1958 of 18 million long tons (20 million short tons) of freight each year to about 7 million long tons (7.8 million short tons).
Richard Naylor 2
All the necessary land was acquired by negotiation with those who were prepared to sell or otherwise by a process of compulsory purchase where the price paid was set, if not by agreement, then by arbitration and, on a few occasions, in court. A landowner who opposed the scheme was a wealthy local banker, Richard Naylor, the owner of the Hooton, Overpool and Netherpool Estates. This land ran down to the south bank of the river, near Eastham, where the Canal would join the Mersey under the new/revised design which was the basis of the 1885 Act.
For those like Mr Naylor, whose land lay to the south of the River Mersey, the Canal created a physical barrier between their land and the river. Amongst other things, that deprived him of the pleasure of mooring his yacht at what was (so to speak) the end of his garden.
In 1914, Hooton Hall was requisitioned by the War Office and became a training ground for one of the newly created Liverpool 'Pals' battalions and later a military hospital. The house itself was demolished in the 1920s or 1930s and the site was used as a military airfield
until the War Office relinquished possession in 1957 (including a period from 1930 to 1933 when it was officially Liverpool Airport).Drainage before and after the 1885 Act.
At the date of the coming into force of the 1885 Act, Mr Naylor's 'estate' comprised the Hooton, Netherpool and Overpool Estates, upon which there was a country house known as Hooton Hall, a racecourse and a polo field. The escape of drainage or floodwater from that part of 'the estate' which now comprises GM's land has been considered by the hydrological experts. They are agreed that the majority of the rainfall over the site would have been absorbed by the land entering the groundwater, with sporadic ponding during extreme storm events. A small proportion of rainfall over the site would have been converted to flow in the ditch network and stream which discharged directly into the River Mersey via the ravine at the north western corner of Booston Wood. MSCC's expert, Mr Jones estimates that the peak run off rate in the ravine in 1882 for a 50% (1 in 2 year event) to have been 150 litres/second.
The experts have also agreed that when the Manchester Ship Canal was constructed, the water level was lower than the ground level at the end of the ravine and it would therefore have discharged directly to the Canal. The flow of water was not significant enough to warrant any special measures and ground water would have continued to flow towards the Mersey Estuary. The Canal would have intercepted any direct surface runoff from the strip of land adjoining. Furthermore, the drainage regime at the ravine did not change as a result of the Canal construction.
The only mitigating measure which was installed to deal specifically with the effects on drainage of surface water following the construction of the Canal was the construction of the Pool Hall Syphon, which was installed to allow the Rivacre Brook to pass beneath the Manchester Ship Canal and to drain into the River Mersey. The central gully flowed directly into the Manchester Ship Canal at the ravine.
Two syphon pipes (the Bankfield and Hooton Syphons) were also provided, one near that part of 'the estate' which now comprises GM's land and the other some 600 metres to the north. These syphon pipes were to deal with sewerage and to comply with the obligation in the 1885 Act to construct
"at least two outfalls by means of iron pipes not less than three feet in diameter for the purpose of carrying sewage from that portion of the estate which will lie southwards of the canal under the canal into the River Mersey",
Both of these pipes are now redundant.
Acquisition of GM's site
Vauxhalls acquired its site at Ellesmere Port from the Secretary of State for Air on 24 July 1961. Prior to that time there had been correspondence in which MSCC had agreed in principle to the discharge of both surface...
To continue reading
Request your trial
-
The Manchester Ship Canal Company Ltd v Vauxhall Motors Ltd (formerly General Motors UK Ltd)
...DIVISION) ON APPEAL FROM THE HIGH COURT OF JUSTICE CHANCERY DIVISION HIS HONOUR JUDGE BEHRENS SITTING AS A JUDGE OF THE HIGH COURT [2016] EWHC 2960 (Ch) Royal Courts of Justice Strand, London, WC2A 2LL Ms Katharine Holland QC and Ms Galina Ward (instructed by Hill Dickinson LLP) for the Mr ......
- General Motors UK Ltd v The Manchester Ship Canal Company Ltd No 2
-
Relief From Forfeiture Granted To A Mere Licensee
...General Motors UK Limited v. The Manchester Ship Canal Company Limited 2016 EWHC 2960 (Ch) the High Court granted relief from forfeiture to a mere licensee, thereby reinstating a licence that had otherwise been validly terminated for non-payment of the licence fee. The grant of relief from ......
-
Relief from forfeiture granted to a mere licensee
...General Motors UK Limited v. The Manchester Ship Canal Company Limited 2016 EWHC 2960 (Ch) the High Court granted relief from forfeiture to a mere licensee, thereby reinstating a licence that had otherwise been validly terminated for non-payment of the licence fee. The grant of relief from ......