PRINCE OF WALES HOTEL.

New Zealand Times, Volume LXIX, Issue 3735, 9 May 1899, Page 5

PRINCE OF WALES HOTEL.

QUESTION AS TO BEER COVENANT,

In the Court of Appeal yesterday, before Mr Justice Mr Justice Denniston, Mr Justice Conolly and Mr Justice Edwards, argument was begun in the special case stated between J. Staples and Company, Limited, brewers, plaintiffs, and 'Patrick William Corby, hotelkeeper, defendant. Sir Robert Stout, with him Mr H. D. Bell and Mr Skerrett, appeared for the plaintiff company, and Mr Monson, with him Mr Young, for the defendant. The basis of this suit is a covenant in the deed of conveyance dated the 16th November, 1889, of the Prince of Wales Hotel, to the effect that the lessee of the hotel would not at any time thereafter permit to he used or consumed in or upon the hotel any colonial ale, stout and malt liquors other than those purchased from the plaintiff company. • Tbo question, for the decision of the 'Court is whether the plaintiff company is entitled to the following relief:— (1) Judgment for £SO as damages; and (2) an injunction restraining the defendant from permitting to be used or consumed in or upon the hotel any colonial ale, stout or malU liquors other than those purchased from the plaintiff company. Sir Robert Stout said this was a suit for what were called nominal damages, namely £SO, and for an injunction, on a restrictive covenant as to colonial beer, which was entered into with reference to a hotel in Wellington known as the Prince of Wales Hotel. There was a lease, and under it there was power of purchase. The defendant, being lessee, exercised the power of purchase, and ho claimed, so counsel understood, that a restrictive covenant which was in the conveyance was not binding on him. He claimed that the land by his purchase was freed from the covenant which was in the original conveyance. Mr Morison intimated that the defendant raised no question as to notice. Sir Robert Stout, continuing, said the point for the decision of the Court, tnereforo, would be whether the Court could, in consequence of the covenant, prevent the defendant from selling colonial malt liquors other than those supplied by the plaintiff company, by an injunction on 1 the land. The point, it was submitted by the plaintiff company, did not necessarily a,rise whether the covenant ran with the land or not. The plaintiff company,' however, said it did run with the land. It said that as the covenant mentioned assigns, it was binding upon every person who was an assignee of the land. The plaintiff company relied on the power of the Court in equity to grant an injunction, on the ground that the contract in question was a contract which hound everyone who purchased the land and who had notice of the contract, it being a restrictive covenant. It was submitted for the plaintiff company that the Court had power, when dealing with a restrictive covenant, to issue an injunction restraining an assignee of the land from using the land contrary to the covenant, and that it had this power independently altogether of whether the covenant ran with the land or mot.

The Court intimated, in reply id Sir Robert Stout, that in the special circumstances of the case, and without making a precedent, it would hear third counsel for the plaintiff company. , At 4.40 pan. the Court adjourned till this morning,- when Sir Robert Stout will conclude his argument.