Property Law
Owen started the exclusive Grand View Lodge in Queenstown(the Lodge) as a successful commercial enterprise. At the bottom of the Lodge gardens is a standalone, elite self-contained unit, called "The Shed." From the Shed there are spectacular views out to Lake Wakatipu and The Remarkables.
Owen sold the Lodge to Vernon some years ago. Owen made sure a clause was inserted in the sale agreement allowing him to occupy the Shed "board free" for the month of August of each calendar year, commencing from the date title passed. This right was stated to be "personal" to Owen for the duration of his life.
At the same time, the sale agreement recorded Owen had the right to store his boat at the Lodge and launchit onto the Lake. Owen wanted both these rightreserved, even thoughin fact he kept his boat stored over the road on a property he still owned. The fact that the boat is actually stored on the property across the road is not recorded in the sale agreement.
In July 2015 Vernon entered into an agreement to sell the Lodge to Percy. The sale agreement does not refer either to Owen's right to occupy the Shed, or Owen's right to store and launch the boat.
Percy visited the property prior to taking title, and saw Owen launching his boat into the Lake. He struck up a chat with Owen, who advised him that he (Owen) had "title" rights to occupy the Shed for the month of August, and also"title" rights to launch his boatfrom Lodge land for so long as he lived. This surprised Percy, who immediately went to see his lawyer, Lucy, and asked her to look into the matter.
Lucy examined the issued certificate of title and told Percy that no such title rights existed. Lucy thenmade the agreement to purchase the property unconditional, by approving the title.
Prior to Percy paying for the land, Lucy received a letter from Owen's lawyer, stating Owen had a lease "for life" to occupy the Shed for the month of August each year, and also an easement to store and launch his boat at the Lodge whenever he wanted to. Lucy ignored this letter as she was confident from her earlier investigations that Owen had no rights that would bind Percy as the new owner.
Title to the Lodge subsequently passed into the name of Percy.
It is now August 2015. Percy is now the registered owner of the land. Owen has arrived at the Lodge. He is claiming he has a right to occupy the Shed and launch his boat onto the Lake over the Lodge property.
REQUIRED
Lucy seeks your legal advice.
a) What is the possible legal basis of Owen's claim to use the Shed?
b) What is the possible legal basis of Owen's claim to launch his boat?
c) In any event, has Percy taken title clear of any of these rights?