Shaw v Applegate

JurisdictionEngland & Wales
JudgeLORD JUSTICE BUCKLEY,LORD JUSTICE SHAW
Judgment Date25 February 1977
Judgment citation (vLex)[1977] EWCA Civ J0225-5
Docket Number1973 S. No. 4374
CourtCourt of Appeal (Civil Division)
Date25 February 1977
William Joseph Shaw
Plaintiffs/Appellants
and
John Shaw
and
Herbert William Applegate
Defendant/Respondent

[1977] EWCA Civ J0225-5

Before:

Lord Justice Buckley

Lord Justice Goff and

Lord Justice Shaw

1973 S. No. 4374

In The Supreme Court of Judicature

Court of Appeal

(Civil Division)

On Appeal from the High Court of Justice

Chancery Division (Group B)

MR. T.L.G. CULLEN (instructed by Messrs. Boxall & Boxall, agents for Messrs. Taylor Broomer & Co., Goals, appeared on behalf of the Plaintiffs/Appellants.

MR. G. NEWSON, Q.C. and MR. A. KHAN (instructed by Messrs. Myer, Wolfe & Co., Emberside appeared on behalf of the Defendant/Respondent.

1

( As approved by the Judge)

LORD JUSTICE BUCKLEY
2

This is an appeal from a judgment of Vice-Chancellor Blackett-Ord, sitting as an additional Judge of the Chancery Division in Manchester, on the 13th February, 1976. He then dismissed the plaintiffs' claim to an injunction to restrain the defendant from using a certain building at Witherman in Yorkshire as an amusement arcade. The covenant on which the plaintiffs sue was a covenant contained in a conveyance dated the 10th November, 1967, and made between a company called Service Machine Company Limited of the one part, and the defendant, Mr. Applegate, of the other part, Under that conveyance there was conveyed to Mr. Applegate upon sale, a piece of land containing 559 sq. yds. or thereabouts, situate on the North side of Seaside Road, Withernsea in the East Riding, and by Clause 3 of the conveyance the defendant covenanted with the vendor so as to bind the land conveyed into whosoever hands it should come, but not so as to render him or him successors liable for breaches after he should have caused to be the owner of the property, not to build or permit to be built, an amusement arcade on the said property or any part thereof, or use or permit to be used any part of the said property for the game of Bingo.

3

The learned Vice-Chancellor jointed out that it was really impossible to predicate of a building, just from its physical characteristics, that it was an amusement arcade and be treated the covenant as being a covenant restrictive of the use of any building on the property, and it is common ground in this Court that that is a proper approach to the covenant.

4

The vendors owned, in addition to the property conveyed by that conveyances to the defendant, other properties in this area of Withernsea, in particular a plot of land in Memorial Avenue, which is a street which leads out of Seaside Road, on which they carried on an amusement arcade business under the name of "Pastimes". They also owned other properties in the near neighbourhood in Seaside road and in Queen Street. I should say that the conveyance to the defendant contained as words ing the benefit of that covenant to any otherproperty of the venders, and nothing indicating what land, if any, the covenant was intended to benefit. But, as I have said, the vendor company was running an amusement arcade business on the plot of land in Memorial Avenue, and it ha not really been disputed before us that this was a covenant which was intended for the benefit of that plot of land.

5

On the following day, the 11th November, Service Machine Company Limited conveyed to the plaintiffs, Mr. William Joseph Show and Mr. John Show, the plot of land is Memorial Avenue, three houses is Seaside road and properties which are referred to as "157, 157a, 157b and 1579 Queen Street", that is to say all the properties in the neighourhood which I have mentioned earlier which they had retained at the time of the conveyance to the defendant. By that conveyance the vendors assigned too the plaintiffs the benefit of the covenant entered into by the defendant in the conveyance of the day before.

6

No notice of that assignment was given by the plaintiffs to the defendant until the 13th April, 1973, when by a letter before motion they wrote giving notice to the defendant that the venders had assigned the benefit of the covenant in the conveyance of Pastimes and the other properties, and by that letter they threatened that unless she defendant should cease to use the property which he had acquired as an amusement arcade within 7 days, they would proceedings.

7

When the defendant acquired the property in Seaside Road it consisted of an open space, or yard, having upon it a wooden of some sort occupying a comparatively small part of it, and in the yard the defendant at first installed certain children's amusement machines, or equipments, such as a ten train ride and some coin-operated "Co-Karts", a Tug Beat, a Flying Sancer, and so on. In the the house there was one fruit machine, but nothing turned upon that for it is not suggested that the tea hut, or the cafe which, it will shortly emerge, succeeded it, have ever formed part of any amusement arcade.

8

I should say that is a small seaside town and has a short. On the evidence of the defendant, he opened his entertainment activities on his site to the public for a short time at Easter, and them for limited hours in the day until the summer, and then throughout the summertime it was open to the public for about two months all day.

9

Between the 1969 season and the 1970 season, that is to may, in the autumn of 1969 and the early months of 1970, the defendant took away the tea house standing on his property and he built a rather mere substantial cafe at that end the open space, with a kitchen behind it, and along the side of the open space which is parallel with Seaside Road and furthest from the road, he erected what has been described as a "lean-to" which, as I understand it, is a building open on its side which faces towards Seaside Road and enclosed on the other three sides. Somewhat later, he installed folding doors on the side of that building facing Seaside Road, but the evidence indicates that when the establishment is open to the public, these doors are folded back and the lean-to is open all along that side of it which faces the road.

10

In 1970, following these alterations, he installed two Pin Tables, a Juke Box, two or three coin-operated Rides, four coin-operated Co-Karts and a Flying Saucer in the lean-to, and out in the open, on the open space in front of the lean-to, be had other childish amusements something called an Octopus, a Peter Pan Train, a Ferris Wheel, a Mini Speedway and a Tug Boat. At this stage there were two fruit machines in the Cafe but, again, that does not affect the question whether or not the lean-to was an amusement arcade.

11

In 1971, for the 1971 season, the defendant got rid of the Flying Saucer from the lean-to but he installed even new slot machines and up to about 74 additional slot machines and three coin-operated rides, that is to say, mechanical devices on which a child can sit and which would move about when a coin was introduced. None of these devices was in any sense a gaming devices. They were purely amusement machines. Outside in the openthe defendant installed the Flying Saucer which had been removed form the lean-to, is addition to his previous stock of entertainments out in the open. The position inside the Cafe remained as it was.

12

In the year 1972, the defendant obtained a gaming-license. That was necessary because he prepared to introduce to the lean-to some fruit machines. These were the first machines installed in the lean-to which were of a kind from which you could recover a prize greater than the value of the coin inserted into the machines. He also introduced to the lean-to seven or eight additional entertainment machines. The position out in the open part of the property remained as it was, and the position in the Cafe remained as it was.

13

In 1973, the defendant added nine new slot machines - I think one of which was a gaming machines, and an additional seven more fruit machines. The position outside remained as before, and the position in the Cafe continued as it had been. It was evidently the introduction of a considerable number of gaming machines which stimulated the plaintiffs into taking the steps that they did to protect against the use that the defendant was making of the property, and to assert that he was committing a breach of the covenant in his conveyance not to use the property for the purposes of an amusement arcade.

14

In about June of 1973, the Plaintiffs incorporated a company which they called "Pastimes (withersea) Limited", in which they were the sale share-holders and they transferred their business at Pastimes, which was the business of an amusement arcade, to the company but they did not convey the land of Pastimes to the company.

15

The writ in the action was issued on the 14jth August, 1973. It claimed the injunction I have mentioned, damages, further or other relief, and costs. The Appellants, who are the plaintiffs, contend that in fact and in law there was no breach of the defendant's covenant until 1973, or no breach known tothem at any rate. They say that is order to avoid any suggestion of acquidence on their part by delay in instituting proceedings at an earlier date.

16

The learned Judge, in his judgment, came to the conclusion that upon the true construction of the covenant, an amusement arcade, for the purposes of the covenant, is a building with free access to the public and containing coin-in-the-slot amusement machines, irrespective of whether they are gaming machines or not, but he thought that the description "amusement arcade" excluded a place of entertainment which was only for very small children. There was some evidence bearing upon this question of what is an amusement arcade. The first witness called by the plaintiffs was the first plaintiff, Mr. William Shaw, and he said that the business which he and his brother carried on at Pastimes was that of an amusement arcade. He was asked what he meant by that expression, and his answer was this: "It had amusement games,...

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