Bottos v Citylink Melbourne Ltd

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S EAPCI 2022 0012

NEILO STEFANO BOTTOS	First Applicant
ADRIAN LLOYD BOTTOS	Second Applicant
v
CITYLINK MELBOURNE LIMITED (ACN 070 810 678)	Respondent

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JUDGES:	BEACH, SIFRIS JJA and J FORREST AJA
WHERE HELD:	Melbourne
DATE OF HEARING:	9 November 2022
DATE OF JUDGMENT:	5 December 2022
MEDIUM NEUTRAL CITATION:	[2022] VSCA 266
JUDGMENT APPEALED FROM:	[2021] VSC 585 (Gorton J)

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REAL PROPERTY – Title – Adverse possession – Adverse possession of land beneath surface – Effect of building wall where posts and supporting structures encroached on adjoining land – Factual possession – Intention to possess – Whether possession open and manifest – Acknowledgment of title – Whether respondent acknowledged applicants’ title.

LIMITATION OF ACTIONS – Trespass against land – Whether applicants’ claim for trespass statute barred – Adverse possession – Adverse possession of land beneath surface – No error in trial judge’s conclusion that trespass claim statute barred – Application for leave to appeal refused.

Limitation of Actions Act 1958, ss 8, 9, 14, 18, 24 and 25; Transfer of Land Act 1958, s 42(2)(b).

Symes v Pitt [1952] VLR 412; Abbatangelo v Whittlesea City Council [2009] VSCA 188; and Price v Spoor (2021) 270 CLR 450 referred to.

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Counsel
Applicants:		Mr M Clarke KC with Mr MF Sharkey
Respondent:		Mr SR Horgan KC with Ms A Hando
Solicitors
Applicants:	Antony, Sdrinis & Co
Respondent:	Herbert Smith Freehills

BEACH JA
SIFRIS JA
J FORREST AJA:

Neilo and Adrian Bottos (‘the applicants’) are, and have at all relevant times been, the registered proprietors of 9 McColl Court, Brunswick West (‘the property’). The property runs generally from south (at the front) to north (at the back), with the Tullamarine Freeway to the north of the property and a noise wall (‘the noise wall’) running diagonally at an angle from the northwest corner of the block to the southeast corner. The unusual shape of the block came about because part of the block had earlier been compulsorily acquired for the purpose of constructing the freeway.
The noise wall was constructed some time in 1999 by CityLink Melbourne Ltd (‘the respondent’). The noise wall consists of large panels set between eight metre high steel H-beam poles set in concrete. There are 11 poles on that part of the noise wall that runs along the boundary of the applicants’ land. Although the wall panels are not on the property, the steel poles are wider than the panels and they extend between 6 to 17 centimetres into the property, according to one survey, and between 0.8 to 3.5 centimetres according to another survey. The steel poles are attached to square concrete bases that extend a further 20 centimetres from the poles. Underneath the concrete bases are deep cylindrical concrete foundations of at least 60 centimetres diameter that extend further into the property.
When one of the poles of the noise wall was being installed, a large amount of concrete spilt over, underground in an irregular shape, further into the property (‘the spillage’). The spillage was about 3 metres long, 1.5 metres wide, and three-quarters of a metre deep, and it encroached by this amount into the property. It was below the surface and covered by soil.
On 16 April 2018, the applicants commenced a proceeding in the Trial Division against the State of Victoria, the Roads Corporation, the respondent and Transurban Ltd. Ultimately, the proceeding only went ahead against the respondent. The applicants sought damages for trespass and an order that the respondent remove the noise wall to the extent that it encroached on the property. The respondent, however, contended that, by reason of the long presence of the noise wall, it had adversely possessed the land occupied by the noise wall, and accordingly it was not liable in trespass.
The applicants’ proceeding was tried over 10 days in June and July 2021 by Gorton J. On 16 September 2021, his Honour delivered reasons,[1] in which he concluded that only the spillage constituted an actionable trespass, the respondent having adversely possessed the land occupied by the poles and their supporting structures. On 13 December 2021, the judge ordered the respondent to pay to the applicants damages in the sum of $69,035 in relation to the trespass caused by the spillage, together with interest pursuant to s 60 of the Supreme Court Act 1986.[2] The judge dismissed the balance of the applicants’ claims.
[1]Bottos v Citylink Melbourne Ltd [2021] VSC 585 (‘Reasons’).
[2]Agreed in the sum of $19,360.30.
The applicants now seek leave to appeal from the order dismissing their claims in respect of the poles and supporting structures. In their application for leave to appeal, the applicants advance seven proposed grounds of appeal, under which they contend that the judge erred in his analysis of the principles of adverse possession, and erred in concluding that that part of the property upon which the poles and supporting structures encroached had been adversely possessed by the respondent.

The facts in more detail

We have already set out the circumstances in which the noise wall came to be constructed in 1999, and we have also described the extent of the encroachment of the steel poles and their supporting structures. In order to understand the issues in this case, it is necessary to set out some additional facts and detail.
It was common ground at trial that, in constructing the noise wall, the respondent did not intend to encroach into the property. A plan of the noise wall, tendered in evidence and stamped ‘as constructed’, shows the noise wall as being set back a small but distinct distance from the boundary of the property. Additionally, other plans tendered at trial showed that, where the noise wall went past other properties in the area, the lease boundary was shown as being set back about a metre from the relevant property.
At the time of the construction of the noise wall, there was a weatherboard house on the property with a large backyard. The property was ‘tenanted out with plans always to develop it into townhouses’. The evidence was that the applicants regularly mowed the lawn of the backyard right up to the noise wall. The concrete supports for the steel poles and the spillage were underground and not visible.
At trial, and in this Court, the applicants contended that, if that part of the property on which the poles and supporting structures encroached was adversely possessed for any period, then that period of adverse possession was broken by circumstances which occurred in 2011–2012: that is, within the 15 year period provided by s 8 of the Limitation of Actions Act 1958 (‘the Act’).
Specifically, in September 2011, the applicants applied to the City of Moreland for a planning permit. The application was prepared by their agent and town planner and sought to construct six units on the property (with the resultant demolition of the weatherboard house). The planning submission report indicated that two of the units were to be built with boundary walls, that is, built to the boundary where the noise wall was. The City of Moreland notified VicRoads of the application as an ‘adjoining land owner’.
In September and October 2012, there was correspondence between the City of Moreland and VicRoads, and between VicRoads and the respondent, as to whether VicRoads objected to the proposed development.
On 19 September 2012, VicRoads sent an email to Martin Hecht (a qualified lawyer and the then commercial affairs manager of the respondent), regarding any ‘necessary set back between the noise wall and the proposed development and any other additional requirements to ensure that there will be no detrimental impact [on] the wall or the development’. The email attached the correspondence between the City of Moreland and VicRoads as well as the title plan and architectural drawings. Mr Hecht forwarded the email from VicRoads to various other people at the respondent, including senior people in operations and maintenance, a senior engineer and the general manager, asking for them to advise him of their feedback so that he could ‘pass it back to VicRoads’. Mr Hecht attached to his email the planning application material, including the plans that showed the build to the boundary and the certificate of title.
On 28 September 2012, the head of maintenance and operations of the respondent replied to Mr Hecht, copying the others in, stating:
Investigations so far indicate that our Lease area should extend 1 metre behind the noise wall whereas the drawings indicate less than 300mm. …
It would be nice to have more land to maintain the wall (not that this seems likely as the current Lease Boundary alignment will prevail) but if we have services that need to be protected, do you know if we would be able to get an easement? My guess is — no (without compensation) …
On 2 October 2012, Mr Hecht replied to VicRoads in the following terms:
From our lease plan it appears that the lease boundary is the actual noise wall where it abuts 9 McColl Court … Our suggested planning conditions would include:
1. At all times a 1 meter width clearance is to [be] maintained along the boundary between the property and the ... noise wall.
On 3 October 2012, VicRoads replied to Mr Hecht asking for information on the noise wall foundation. On 5 October 2012, Mr Hecht, after making the necessary enquiries, replied to VicRoads attaching ‘drawings and plans’, including of different noise wall foundations. In his reply, Mr Hecht said that it could not be ascertained which plan was used, without an ‘infield survey’. A foundation with a diameter of 600 mm was thought the most likely. The alternative was a foundation with a diameter of 900 mm. One of the drawings was said to show that the property ‘backs onto’ the noise wall.
On 8 October 2012, VicRoads wrote to the Moreland City Council, advising that it had reviewed the application and that it did not object to the application with the recommended condition that the ‘northern fence line [be] set back by 1.0 metre from the existing noise wall columns for maintenance purposes’.
On 12 October 2012, Lawrence Li, as the applicants’ agent, sent a letter to the Moreland City Council opposing the proposed condition. On 7 November 2012, Moreland City Council issued a notice of decision to grant a planning permit without the condition recommended by VicRoads. No appeal was lodged by VicRoads. On 5 December 2012, a planning permit for the construction of six units was issued in accordance with the notice of decision.
The applicants commenced construction of the units in mid-2017. In February 2018, during the course of the construction of the units by the applicants, the spillage was discovered. It was approximately 40 centimetres below the surface with the dimensions we have already set out. On 21 March 2018, the property was re-surveyed and a re-establishment plan was prepared that revealed, for the first time, the encroachments by the metal poles. This was the first time that it was appreciated that parts of the noise wall encroached upon the property. Shortly thereafter, the spillage was removed by the respondent. The noise wall and its support structures, however, have remained in place.
It was necessary for the external wall of the two rear units to be brought in by 20cm from the boundary to accommodate the encroachment by the poles. The foundations of both these units were diverted around the poles.
On 16 April 2018, by which time the spillage had been removed, the applicants (as we have already noted) commenced the proceeding which is the subject of this application for leave to appeal. On 4 July 2019, the applicants discontinued the proceeding against the State of Victoria and VicRoads. On 17 July 2019, the applicants, the State of Victoria and VicRoads entered into a settlement agreement whereby the applicants agreed to pay the State and VicRoads $9000 and released them from any further claims.

Relevant provisions of the Act

Section 8 of the Act relevantly provides:
No action shall be brought by any person to recover any land after the expiration of fifteen years from the date on which the right of action accrued to him … .
Section 9(1) of the Act relevantly provides:
Where the person bringing an action to recover land … —
(a) has been in possession thereof; and
(b)has while entitled thereto been dispossessed or discontinued his possession —
the right of action shall be deemed to have accrued on the date of the dispossession or discontinuance.
Section 14(1) of the Act relevantly provides:
No right of action to recover land shall be deemed to accrue unless the land is in the possession of some person in whose favour the period of limitation can run (hereafter in this section referred to as ‘adverse possession’); and where under the foregoing provisions of this Act any such right of action is deemed to accrue on a certain date and no person is in adverse possession on that date the right of action shall not be deemed to accrue until adverse possession is taken of the land.
Subject to an exception not presently relevant, s 18 of the Act relevantly provides:
[A]t the expiration of the period prescribed by this Act for any person to bring an action to recover land … the title of that person to the land shall be extinguished.
Section 24(1) of the Act relevantly provides:
Where there has accrued any right of action … to recover land … , and —
(a)the person in possession of the land … acknowledges the title of the person to whom the right of action has accrued … —
the right shall be deemed to have accrued on and not before the date of the acknowledgement … .
Section 25 of the Act relevantly provides:
(1)Every such acknowledgment as aforesaid shall be in writing and signed by the person making the acknowledgment.
(2)Any such acknowledgment … may be made by the agent of the person by whom it is required to be made under the last preceding section, and shall be made to the person, or to an agent of the person, whose title … is being acknowledged … .

The judge’s reasons

The judge commenced his reasons with an overview of the issues in dispute at trial.[3] He then described the property, and the construction of the noise wall and the encroachments,[4] before summarising the relevant provisions of the Act.[5] His Honour said that it followed from those provisions that, if the respondent had ‘dispossessed the [applicants] of the land occupied by the noise wall in 1999, and if the application in 2012 for a planning permit did not break that possession or result in an acknowledgment of title by [the respondent], then time to commence a proceeding to recover that land would have run out in 2014’.[6] His Honour noted that, as such, the respondent contended that the applicants had lost title to the land occupied by the encroachments, and were therefore unable to claim damages for trespass.[7]
[3]Reasons [1]–[3].
[4]Ibid [4]–[9].
[5]Ibid [10].
[6]Ibid [11].
[7]Ibid.
At trial, the applicants contended that the Land Acquisition and Compensation Act 1986, which permits the Crown to acquire land compulsorily on the payment of proper consideration, covered the field and by implication ousted any acquisition of land by the Crown under the Act. The judge rejected that submission.[8] The applicants have not sought to re-agitate that argument in this Court.
[8]Ibid [13]–[17].
Next, under the heading, ‘Is [the respondent] otherwise unable to rely on its adverse possession defence?’, the judge set out the applicants’ submissions, as he understood them, that:
(a) the extinguishment of title provided for in s 18 of the Limitations Act does not operate automatically on the expiration of the limitation period, but only operates in the event that a party properly raises the limitation period in a defence to a claim against it;
(b) they had commenced proceedings against the Crown, the Crown had not raised the limitations defence, and they had since compromised their claim against the Crown. Accordingly, the Crown would not now be able to raise a limitations defence or assert that the Bottos brothers’ title had been extinguished by reason of the principles set out in Port of Melbourne Authority v Anshun; and
(c)accordingly, CityLink, as a tenant of Crown land, is unable to contend in this proceeding that the Bottos brothers’ title has been extinguished to the land occupied by the noise wall, which is the basis of its defence to the claim in trespass.[9]
[9]Ibid [18] (citation omitted).
The judge accepted the submission set out in (a). As to the submissions set out in (b) and (c), the judge said:
The following propositions underlay the second part of the Bottos brothers’ argument set out in paras (b) and (c) above:
(a)there is a presumption that a tenant adversely possessing land is adversely possessing that land on behalf of its landlord;
(b) unless that presumption is rebutted, it is the landlord that obtains the benefits or protections given by the Limitations Act;
(c) because of this, it is only the landlord that can plead and take advantage of the Limitations Act;
(d) here, the presumption has not been rebutted, the Crown has not pleaded the Limitations Act, and indeed would now be estopped from doing so; and
(e) accordingly, CityLink is not able to rely on the protections given by the Limitations Act.
I accept the propositions set out in paras (a) and (b), at least in so far as the land occupied is adjacent to the leased premises.[10] But I do not accept that it follows that a tenant is not able to plead and take advantage of the Limitations Act in a proceeding brought against it. The presumption that an adversely-possessing tenant is doing so on behalf of its landlord is directed to the result at the end of the tenancy. The presumption means that the adversely possessed land is treated as part of the demised property rather than land being separately occupied by the tenant outside that tenancy arrangement. At the end of the tenancy, the tenant does not retain a right of possession as against the landlord; and the landlord, as against the registered title owner, is able to take advantage of the period of dispossession that took place during the tenancy. However, there is no presumption that the tenant is not possessing the land for its own purposes during the course of the tenancy. There is no reason to think that, so long as the tenancy continues, the tenant in possession does not or ought not have such protections as the Limitations Act provides.
It should be remembered that the principles governing adverse possession are focussed on possession and possessory titles, rather than registered titles. Disputes as to adverse possession may well arise between two people, neither of whom is a registered proprietor.[11] The fact that there is a registered proprietor with no present right to possession ‘in the background’ to a dispute between two parties, each of which claims the present right to possess land, ought not to affect, and in my opinion does not affect, the ability of those persons to rely on the Limitations Act in proceedings between them relating to or arising from that claimed possessory right.
The Bottos brothers note that s 18 of the Limitations Act ‘extinguishes the title’ to the possessed land and thus on its face directs attention to the registered titleholder. It is, perhaps, tempting to think that, because of the language of
s 18, it ought to or does only apply to disputes where the party claiming to adversely possess is the titleholder who will ultimately benefit from the adverse possession, and that it ought not to apply for the benefit of mere tenants. But this is not so. Section 18 of the Limitations Act, where it applies, does not transfer an interest in land; rather, it operates only to extinguish ‘the title of the dispossessed against the dispossessor’.[12] Further, it operates as an adjunct once it has been established that the limitation period has expired, rather than as a controlling device governing when the expiration of a limitation period may be relied upon. As I see it, a ‘claim to recover land’ may be brought against a person in adverse possession, even if that person is a tenant of neighbouring land.[13] The adversely-possessing neighbouring tenant may then plead the limitations defence. If time had expired prior to issue, the limitations defence will defeat the claim to recover possession. The associated extinguishment, seen as an adjunct, will then operate to extinguish the title of the dispossessed against the adversely-possessing neighbouring tenant, and defeat any claim for damages for the trespass constituted by the adverse possession.[14] This may all happen without any involvement of the tenant’s landlord at all. The fact that, at the end of the tenancy, the landlord may obtain possession of the relevant land from the tenant, and can rely on the period of adverse possession by the tenant if an action were brought against it by the registered titleholder, does not remove the protections set out in the Limitations Act from the tenant in the meantime. Indeed, it would be an odd result if a long-term tenant’s ability to rely on the Limitations Act as a defence to a claim to recover land, or a claim in trespass, were to depend on the attitude of the tenant’s landlord.
Accordingly, it does not follow that, because the Crown as landlord has not raised the limitation defence, CityLink as tenant cannot contend, in its defence to the claim for damages against it:
(a) that the time limit in s 8 of the Limitations Act has expired; and
(b) that the Bottos brothers’ title as against it has been extinguished by s 18 of the Limitations Act sufficiently to prevent an action for trespass.
My conclusion is consistent with the conclusion in Hampshire Automatic Centre Pty Ltd v Centre Com (Sunshine) Pty Ltd[15] that a tenant does not require the consent of its landlord to establish an easement by prescription over neighbouring property, or the consent of its landlord to bring an action to prevent interference with the tenant’s enjoyment of that easement, notwithstanding that the easement ultimately crystallises into a proprietary interest of the owner and in that way enlarges the freehold title of the landlord. The Bottos brothers observed that it was decided in that case that the landlord should be joined because the tenant was seeking a declaration as to a proprietary interest in the landlord’s land.[16] I do not consider that that requirement prevents CityLink from relying on the Limitations Act in its defence in this proceeding. CityLink is not seeking a declaration to the effect that it or anyone else has obtained ownership of the land occupied by the noise wall, but is simply contending that the Bottos brothers’ title has been extinguished (by implication, as against CityLink) by reason of the Limitations Act, and the Bottos brothers are parties.[17]
[10]Kingsmill v Millard (1855) 156 ER 849; Tower Hamlets LBC v Barrett [2006] 1 P&CR 9, 139–40 [26]–[30] (Neuberger LJ).
[11]Taylor v Twinberrow [1930] 2 KB 16 is an example. It concerned a licensee of a subtenant who overstayed and obtained by adverse possession a right to remain enforceable against the subtenant, but not enforceable against the owner when the subtenancy ended. Similarly, in Tichborne v Weir (1892) 67 LT 735 an equitable mortgagee who assumed possession of tenanted premises obtained possessory rights as against the mortgagor without any involvement of the landowner.
[12]Price v Spoor (2021) 95 ALJR 607, 632 [114], 633 [118] (Steward J); Fairweather v St MaryleboneProperty Co Ltd [1963] AC 510. See also Taylor v Twinberrow [1930] 2 KB 16, 23 (Scrutton LJ); Tichborne v Weir (1892) 67 LT 735.
[13]Indeed, it would be surprising if the proceeding were brought against anyone else. See Tower Hamlets v Barrett [2006] 1 P&CR 9, 149 [83] (Neuberger LJ).
[14]At least for any trespass that post-dated the extinguishment. See Beaulane Properties Ltd v Palmer [2006] Ch 79, 142 [220] (Strauss QC).
[15](2019) 60 VR 579, 595 [78]–[79], 597 [92], 598 [95], 600 [106] (Tate, Niall and Emerton JJA).
[16]Ibid 604 [128].
[17]Reasons [20]–[25] (footnotes in original).

Under the heading, ‘Did [the respondent] dispossess [the applicants]?’, the judge said that the respondent was required to establish that it dispossessed the applicants by going into possession of the land for the requisite period without their consent. His Honour said that there must be both actual possession or physical control of the land (factual possession) and an intention to possess; and that it was the intention to occupy and use the land as one’s own that ‘transforms what might otherwise be mere occupation into possession’.[18]
[18]Ibid [27].
As to factual possession of the poles and supporting structures, the judge said:
In my view, by building the noise wall, CityLink factually possessed, and factually dispossessed the Bottos brothers of, the space physically occupied by the noise wall and its support structures. CityLink used the land occupied by the structure as if it were its own.[19] This is not a case where the area under consideration was an open area upon which different people might wander, such as a field, or a piece of open land. It was a space actually, physically occupied by a solid structure. It is analogous, perhaps, to a piece of land enclosed by an impenetrable fence, which would effectively compel a finding of factual possession: ‘enclosure is the strongest possible evidence of adverse possession’.[20] Only one person can be in factual possession,[21] and, to my mind, it is self-evident that CityLink, and not the Bottos brothers, was in possession of this space. It is not to the point that the Bottos brothers had plans for the land and had not abandoned it.[22]
In this case, the metal poles encroached at the surface of the land, and the support structures encroached a further distance under the surface of the land. The Bottos brothers also contended that, even if CityLink possessed the land occupied by the metal poles, because the Bottos brothers continued to possess the surface of the block right up to the fence, they were not dispossessed of the underground land occupied by the support structures.
I accept that the Bottos brothers did continue to possess the surface of their block right up to the noise wall. Not only were they not denied access right up to the noise wall, but they entered onto that area when they mowed the grass. Normally, possession of the surface carries with it possession of the land underneath and the space above.[23] However, where one party possesses the surface and another party possesses a space under or above that surface, the physical space may be in concept divided; the possession of a part of three-dimensional space may amount to ‘adverse possession’ of that part notwithstanding that someone else is in actual possession of the three-dimensional space above or below. For example, in Midland Railway Company v Wright,[24] an adverse possessor of the surface of land was found not to be in possession of a tunnel underneath that land. Similarly, in Symes v Pitt,[25] it was held that a person was in adverse possession of the surface of a strip of land between two houses despite the fact that the eaves of the neighbour and true owner’s house extended over that strip. The practical result was that the dispossessor obtained rights to the strip of land, but subject to the true owner’s rights to the ‘cubical space’ occupied by the eaves.
The only case cited to me that supported the view that the ‘adverse possession’ of an underground space dispossessed the occupier of the surface of that underground space was Rains v Buxton.[26] In that case, the plaintiff had a cellar that went under the ground of his neighbour. It was apparent that the cellar had been there for more than the relevant period. The Court recognised that, by reason of the equivalent legislation then in force, the plaintiff was ‘entitled to that cellar’, and the Court enjoined the neighbour from performing works that would interfere with it. There is no real discussion in that case of the principles that apply in such circumstances. But in the later case of Symes v Pitt,[27] Sholl J stated as a principle of law:
A disseisor of … strata under the surface, or of other cubical spaces under the surface, acquires only that of which he takes actual possession.[28]
It is implicit in this expression of principle that a person who takes occupation of underground land is taking possession of that ‘cubical space’ (albeit only that space) for the purpose of the Limitations Act. I was not referred to any cases that disagreed with the statement of principle by Sholl J or that expressed principles that conflicted with it in a relevant context. This expression of principle, with which I respectfully agree, defeats the Bottos brothers’ contention that they were not factually dispossessed by the underground structures of the noise wall because they retained possession of the surface.[29]
[19]Ibid 443 [61] (Lord Browne-Wilkinson).
[20]Powell v McFarlane (1979) 38 P&CR 452, 478 (Slade J), quoting Seddon v Smith (1877) 36 LT 168, 169 (Cockburn CJ).
[21]A Pye (Oxford) Ltd v Graham [2003] 1 AC 419, 436 [41] (Lord Browne-Wilkinson), 445 [70] (Lord Hope).
[22]Ibid 437 [45] (Lord Browne-Wilkinson).
[23]Midland Railway Co v Wright [1901] 1 Ch 738, 744 (Byrne J); Symes v Pitt [1952] VLR 412, 424 (Sholl J).
[24][1901] 1 Ch 738.
[25][1952] VLR 412.
[26](1880) 14 Ch D 537.
[27][1952] VLR 412.
[28]Ibid 425 (Sholl J).
[29]Reasons [29]–[33] (footnotes in original).
The judge then turned to the issue of the respondent’s intention to possess, rejecting the applicants’ contention that the respondent did not have the necessary intention to possess. Specifically, his Honour said:
The intention to possess is established if a person intends to exercise the custody and control they have on their own behalf and for their own benefit. That intention may be deduced from the physical acts of possession themselves.[30]
In my view, the situation where the land under consideration is the space occupied by an actual physical structure is different to the situation where the land under consideration is an open piece of land. In the latter situation, a question may arise as to whether the use of that piece of land amounts to, and is intended to amount to, taking possession of that piece of land and dispossession of any paper titleholder. For example, using a piece of land to grow vegetables or to support livestock or as part of a garden, or even placing a fence around the perimeter of a piece of land, could, depending on the circumstances, be use of the land that is consistent with ongoing use also by the paper titleholder and thus might not amount to a dispossession of the paper titleholder.[31] This is where the requirement that there be an ‘intention to possess’ comes into play as part of an evaluation of whether the use amounts to the taking of possession by the user and associated dispossession of the paper titleholder, or a use short of the taking of possession. However, the actual and deliberate physical occupation of space by a bulk structure that is intended to be a permanent presence thereafter, in my view, not only effects an actual dispossession of others from that space, but would ordinarily carry with it the necessary associated intention to exclude others from that space. In my view, CityLink self-evidently did intend to possess, to the exclusion of others, the space physically occupied by the noise wall, both above and below the ground.[32]
[30]J A Pye (Oxford) Ltd v Graham [2003] 1 AC 419, 435 [40] (Lord Browne-Wilkinson); Whittlesea City Council v Abbatangelo (2009) 259 ALR 56, 60 [6(b)] (Ashley, Redlich JJA and Kyrou AJA); Cervi v Letcher (2011) 33 VR 320, 336 [59] (John Dixon J).
[31]These have been referred to as ‘casual acts of trespass’: Whittlesea City Council v Abbatangelo (2009) 259 ALR 56, 60 [6(g)] (Ashley, Redlich JJA and Kyrou AJA).
[32]Reasons [35]–[36] (footnotes in original).
The judge noted the applicants’ submission that the respondent did not have the necessary intention to possess because the noise wall was not intended to be a boundary wall and because the respondent did not intend to build the noise wall other than on its own property.[33] With respect to this submission, the judge said:[34]
I accept that CityLink did not intend the noise wall to be a boundary wall and that CityLink did not intend to build the noise wall other than on its own property. But it does not follow that CityLink did not have the necessary intention to possess the land occupied by the noise wall. Both these arguments are related ways of saying that an occupier of another’s land does not have the intention to possess necessary to engage the Limitations Act unless the occupier is intending to possess land that it knows is owned by another. That is not the law. It is the existence of an intention to possess that matters, not whether the possessor was aware of the fact that the land was on another’s title.[35] As was observed by Brooking JA in Malter v Procopets,[36] most adverse possessions take place inadvertently. It is hard to see why accidental dispossessors ought to be treated less favourably than deliberate dispossessors. Indeed, the fact that CityLink believed that it had the right to possess the land occupied by the noise wall, if anything, assists CityLink in its argument that it intended to possess it.[37]
[33]Ibid [37].
[34]Ibid (footnotes in original).
[35]Ibid 58 [5] (Ashley, Redlich JJA and Kyrou AJA).
[36](2000) V ConvR 54-624, 64,463 [5].
[37]See, eg, Tower Hamlets LBC v Barrett [2006] 1 P&CR 9 142 [42] (Neuberger LJ).
The judge recorded the applicants’ contention that, ‘there was no adverse possession because the encroachment by the noise wall, but particularly by the underground foundations, was not “manifest and open”’.[38] After referring to a number of authorities, including J A Pye (Oxford) Ltd v Graham[39] and Whittlesea Council v Abbatangelo,[40] the judge said:
I doubt that there is, in truth, a separate requirement that the dispossession be ‘open and manifest’. Rather, the extent to which the acts relied upon are open and manifest is something to be considered, depending on the circumstances, when evaluating whether there was factual possession and an intention to possess by the adverse possessor. For example, someone who quietly under the cover of night grazes stock on the land of his or her neighbour is probably not, in part due to the lack of openness, in fact taking possession of, or intending to exclude others from, that land.
In any event, I consider that (with the exception of the spillage, considered below) the taking of possession by the noise wall was ‘open and manifest’. The wall is a massive structure and there was nothing secretive about it. The fact that the encroachments were of small dimension and that a survey undertaken in 2012 did not identify them does not mean that they were not open and manifest. Further, although the precise design and location of the foundations could not be seen because the foundations were underground, the fact that there would be significant foundations was apparent. Nobody suggested that the foundations as constructed were of a surprising design or size. In those circumstances, I consider that the wall, including the associated foundations, were ‘open and manifest’.[41]
[38]Reasons [41].
[39][2003] 1 AC 419 (‘Pye’).
[40](2009) 259 ALR 56 (‘Abbatangelo’).
[41]Reasons [44]–[45] (footnote omitted).
Finally, on the question of liability, the judge dealt with the applicants’ contention that, if that part of the property on which the poles and supporting structures encroached was adversely possessed for any period, then the period of possession by the respondent was broken by, and the respondent acknowledged the applicants’ title to the property in, communications relating to the planning process that occurred in 2011–2012. His Honour then set out the relevant correspondence that passed between relevant parties between September 2011 and December 2012, to which we have already referred,[42] before saying that there were further communications that took place in 2016 when an application was made to amend the planning permit.[43] The judge said that he did not see these (the communications that took place in 2016) as taking the matter any further.[44]
[42]Ibid [53]–[69].
[43]Ibid [70].
[44]Ibid.
The judge rejected the applicants’ submission that, by reason of the application for and grant of the planning permit, the 15 year period of possession by the respondent of the property was interrupted.[45] The judge said that the respondent’s adverse possession of the land occupied by the poles and supporting structures could not cease unless there was a change in the possession of that land from possession by the respondent to possession by the applicants; or possibly a change in the respondent’s intent. His Honour said that neither change took place: the encroachments stayed, and the respondent did not abandon its intention to possess the land occupied by the poles and supporting structures.[46] The judge said that even if the application for a planning permit amounted to an assertion of title by the applicants, without taking possession, any such assertion of title would be insufficient to break the respondent’s period of possession.[47]
[45]Ibid [71].
[46]Ibid [72].
[47]Ibid [72]–[74].
On the question of whether the respondent acknowledged the applicants’ title, the judge said:
The more difficult issue is whether the agreement by VicRoads to the granting of the planning permit, so long as a condition were imposed, amounted to an acknowledgement in writing of the Bottos brothers’ title. If it did, the questions arise as to whether, in making that acknowledgment, VicRoads was acting as CityLink’s agent and whether the acknowledgment was made to the Bottos brothers or to their agent.[48]
[48]Ibid [75].
The judge concluded that none of the communications made in the period September 2011 to November 2012 contained an acknowledgement of the applicants’ title. With particular reference to the letter from VicRoads to the Moreland City Council on 8 October 2012, the judge said:
It seems to me, at its heart, that an acknowledgment of the Bottos brothers’ right to possess the land right to the boundary could only be implied if the communication were inconsistent with there being a question as to who was in possession of or had the right to possess land at the boundary. Perhaps, if by the letter VicRoads had communicated to the Bottos brothers that CityLink did not object to the Bottos brothers constructing units to the boundary, that would have amounted to an implied acknowledgment that the Bottos brothers had the right to possess the land to the boundary. But here, the letter made it clear that CityLink sought a condition that the build be at least a metre away from the boundary. This allowed for the possibility of a dispute as to who had actual possession of or had the right to possession of the land at the boundary occupied by the noise wall and its foundations. Thus, in my view, it did not impliedly acknowledge that the Bottos brothers had that right.[49]
[49]Ibid [82].
Although not relevant to the determination of this appeal, his Honour found that the spillage constituted a trespass on the applicants’ land.[50] As we have already said, the applicants’ damages were assessed at $69,035.[51]
[50]Ibid [120].
[51]Ibid [182].

Proposed grounds of appeal

The applicants’ proposed grounds of appeal are as follows:
1. Was the adverse possession by the respondent open and manifest?
2.Has the Court erred in its textual analysis of s 18 of the Act at Reasons [42]?
3.Does exclusive possession of the surface of land constitute possession of land below?
4.Did the respondent have the necessary intention to adversely possess the applicants’ land?
5.Is the respondent entitled to rely on any possible right to claim adverse possession vesting in its landlord, the State of Victoria, in defence of a claim for damages for trespass when the State of Victoria is no longer a party to the proceeding?
6.Can the ownership of land in Victoria be in limbo or abeyance?
7.Did VicRoads, as agent for the respondent, acknowledge the applicants’ title to the encroached land within the meaning of s 25 of the Act?

Proposed ground 1: was the adverse possession by the respondent open and manifest?

Applicants’ submissions

Under proposed ground 1, the applicants submitted that the judge ‘misstated the law as it relates to adverse possession’, ‘misapplied the principles to the facts’, and ‘failed to take into account all the evidence in reaching findings of fact’.
In submitting that the judge misstated the law, the applicants contended that the judge erred, when he ‘doubt[ed] that there is, in truth, a separate requirement that the dispossession be “open and manifest”’.[52]
[52]Ibid [44].
In submitting that the judge misapplied relevant principles to the facts and failed to take into account all of the evidence, the applicants complained about the judge’s statement that, ‘nobody suggested that the foundations as constructed were of a surprising design or size’.[53] The applicants submitted that the judge fell into error by failing to take into account the unchallenged evidence of the applicants that they were unaware of the nature and extent of the foundations and incursion of the poles and their supporting structures below ground; correspondence which showed that the respondent and VicRoads did not know the extent of the foundations; and the evidence of the respondent’s surveyor, Mr Sullivan, that in order to find out about the extent of the foundations, a surveyor would need to dig using a mechanical digger.
[53]Ibid [45].
The applicant submitted that it followed from the evidence given at trial that there was no basis for his Honour to say that nobody suggested the foundations as constructed were of a surprising design or size. On the contrary, it was ‘reasonable to expect that foundations on boundaries of properties are contained within the boundary of the relevant property’. Thus, the applicants submitted that the judge ‘failed to apply the true legal test to the facts’.

Proposed ground 1: analysis and conclusion

The requirement that the possession needed to support a claim for adverse possession must be ‘open and manifest’ comes from the judgment of Cooper J in McDonell v Giblin.[54] In McDonell, Cooper J said:
In order to dispossess the rightful owner the possession which is claimed to be adverse to his rights must be sufficiently obvious to give to such owner the means of knowledge that some person has entered into possession adversely to his title and with the intention of making a title against him; it must be sufficiently open and manifest that a man reasonably careful of his own interests would, if living in the locality and passing the allotment from time to time, by his observation have reasonably discovered that some person had taken possession of the land. No doubt, in applying this rule, regard must be had to the character and position of the land.[55]
[54](1904) 23 NZLR 660 (‘McDonell’) (emphasis added).
[55]Ibid 662.
Cooper J’s statement was cited with approval and applied by Pagone J, at first instance, in Abbatangelo v Whittlesea City Council.[56] On appeal, in Whittlesea City Council v Abbatangelo,[57] this Court set out a number of relevant principles relating to adverse possession,[58] one of which was that a court will ‘require clear and affirmative evidence that [a] trespasser, claiming that he has acquired possession, not only had the requisite intention to possess, but made such intention clear to the world’.[59] After setting out the relevant principles, the Court of Appeal referred to Pagone J’s statement of the principles at first instance as being ‘broadly consistent with our summary of the principles’.[60] Thus it is apparent that the Court of Appeal in Abbatangelo considered (rightly in our respectful view) that there was no material difference between its formulation of the requirement that possession be ‘clear to the world’ and the earlier formulation of the requirement that it be ‘open and manifest’.
[56][2007] VSC 529, [6].
[57][2009] VSCA 188 (‘Whittlesea’).
[58]Ibid [5]–[6].
[59]Ibid [5] (emphasis added).
[60]Ibid [49].

In any event, there is no substance in the applicants’ submission that the judge misstated the law when he doubted that there was a separate requirement that dispossession be ‘open and manifest’; rather than simply being ‘something to be considered, depending on the circumstances, when evaluating whether there was factual possession and an intention to possess by the adverse possessor’.[61] The question posed by his Honour was rendered moot by the way in which he ultimately dealt with the issue. Having expressed his doubt as to the existence of a separate requirement, his Honour then went on to say that in any event he considered that the taking of possession by the noise wall was ‘open and manifest’. Thus, notwithstanding his Honour’s expressed doubt, it is plain that his Honour found that the possession relied upon by the respondent was open and manifest.
[61]Reasons, [44].
Similarly, there is nothing in the applicants’ contention that the judge misapplied the principles to the facts, or failed to take account of all of the evidence. In the circumstances of this case, it was not necessary for the judge to refer to the evidence that the applicants did not know the extent of the encroachment below ground; the correspondence relied upon by the applicants, showing that the respondent and VicRoads did not know the precise extent of the foundations; or the evidence of the respondent’s surveyor that in order to find out about the extent of the foundations, a surveyor would need to dig using a mechanical digger. The judge was perfectly entitled to conclude that the taking of possession by the noise wall was open and manifest for the reasons he gave: namely, that the wall was a massive structure, with nothing secretive about it; the fact that there would be significant foundations was apparent; and there was no suggestion that the foundations were of a surprising design or size.[62] Having examined all of the evidence for ourselves, we are unable to see any error in his Honour’s conclusion that the respondent’s possession was open and manifest. Indeed, on a proper understanding of all of the evidence, we doubt that any other conclusion would have been open.
[62]Ibid [45].
Proposed ground 1 must be rejected.

Proposed ground 2: has the Court erred in its textual analysis of s 18 of the Act?

Applicants’ submissions

Under proposed ground 2, the applicants complain about the judge’s statement that there is ‘nothing in the text of [the Act] that imposes an additional requirement that the possession be open and manifest or clear to the world, and the more recent authoritative expressions of principle are more confined’.[63] The applicants submit that there was no basis for this statement, and that it was unnecessary for the judge to ‘embark on a textual analysis of s 18 [of the Act]’. The applicants then submit that ‘this … led his Honour into error in his ultimate conclusion’.

Proposed ground 2: analysis and conclusion

[63]Ibid [42].

For the reasons we have given rejecting the applicants’ submissions under proposed ground 1 that the judge misstated the law, there is no substance in proposed ground 2. As we have already said, the judge found that the respondent’s possession of the relevant parts of the property was open and manifest. There was no error in the judge observing that none of the relevant provisions of the Act contained text that used the words ‘open and manifest’ or ‘clear to the world’. Even if it could be said that there was some error in this part of the judge’s analysis at Reasons [42], any such ‘error’ is of no moment, having regard to his Honour’s ultimate conclusion that the respondent’s ‘taking of possession by the noise wall was “open and manifest”’.[64]
[64]Ibid [45].
Proposed ground 2 must be rejected.

Proposed ground 3: does exclusive possession of the surface of land constitute possession of land below?

Applicants’ submissions

Under proposed ground 3, the applicants variously submitted:
•‘possession must be exclusive or unitary so that a paper owner and a trespasser cannot be in possession at the same time’;
•the authorities relied upon by the judge to conclude that the respondent had taken factual possession of those parts of the poles and supporting structures that were below the surface (Rains v Buxton,[65] Midland Railway Company v Wright[66] and Symes v Pitt[67]) did not support the judge’s conclusion of factual possession;
•the respondent’s possession ‘was not exclusive, open nor manifest’;
•the applicants and the respondent were in possession at the same time, ‘precluding the [respondent] from claiming exclusive possession for the purposes of acquisition by adverse possession’;
•the applicants were in possession of the surface of the land which prima facie is also possession of the soil and minerals below; and
•the judge erred by not taking into account the applicants’ possession, or the need for an adverse possession to be exclusive.

Proposed ground 3: analysis and conclusion

[65](1880) 14 ChD 537 (‘Rains’).

[66][1901] 1 Ch 738 (‘Midland Railway’).

[67][1952] VLR 412 (‘Symes’).

The respondent possessed that part of the land upon which the posts protruded above ground. In addition to possessing this surface land, it also possessed the land below upon which the posts were situated. Looking at the more substantial supporting structures (which are below the ground surface), it is possible to say that the applicants possessed the surface above those structures, but the respondent possessed the ‘cubical spaces’[68] containing those structures.
[68]To use the language of Sholl J in Symes [1952] VLR 412, 424–5.
In concluding that the respondent possessed the below the surface spaces containing the supporting structures, the judge relied principally upon the decision of Symes. Symes was a case which involved a defendant adversely possessing a strip of the plaintiff’s land on the boundary between their two properties. The complicating factor was that, on the plaintiff’s land, there was a house (which was not the subject of the claim for adverse possession), the eaves and foundations of which possibly encroached on the strip of land which was the subject of the adverse possession claim.
After referring to Midland Railway and Rains, Sholl J set out the following propositions of law:
(1)Acquisition by adverse possession of the surface gives ownership of everything above the surface and of everything below … .
(2)Except strata severed in title before the commencement of the disseisor’s possession; and the same must be true of other cubicle spaces.
(3)And except strata or other cubical spaces, below or, semble, above the surface, of which the disseisee remains in actual possession … .
(4)A disseisor of minerals or strata under the surface, or of other cubicle spaces under the surface, acquires only that of which he takes actual possession.
(5)Strata above the surface cannot be in fact severed in title unless actually forming part of buildings, because no feoffment could be made of such strata or spaces; the same must be true of other cubicle spaces; and accordingly proposition (4) applies also to strata or other cubicle spaces above the surface.[69]
[69]Symes [1952] VLR 412, 425 (italics in original).
In determining that the respondent possessed the relevant parts of the noise wall that encroached on the property below the surface, the judge applied Sholl J’s proposition (4). Contrary to the applicants’ submissions, the judge’s application of proposition (4) involved no error. Merely because the various facts in Rains, Midland Railway and Symes were different from the present facts was not a basis for his Honour to disregard the propositions identified in Symes. The applicants’ assertions to the contrary (including their assertions that the respondent’s possession of the relevant structures was not exclusive) are without substance.
Proposed ground 3 must be rejected.

Proposed ground 4: did the respondent have the necessary intention to adversely possess the applicants’ land?

Applicants’ submissions

Under proposed ground 4, the applicants submitted that the respondent ‘did not have the necessary intention to possess their land in order to adversely possess it’. Relying upon the conduct of the respondent and its agents in relation to the applicants’ planning permit applications in 2011–2012 (and later in 2016), and the decision of Cervi v Letcher,[70] the applicants submitted that the conduct of the respondent in failing to assert any possessory right when it had opportunities to do so in 2012 and 2016 told against the respondent having the requisite intention to possess the applicants’ land.
[70](2011) 33 VR 320 (‘Cervi’).
In submitting that the respondent lacked the requisite intention to possess their land, the applicants also relied upon the respondent’s actual intention as having been to build a noise wall one metre back from any private land; and its intention to pursue compulsory acquisition in respect of any land that it needed to possess. Additionally, the applicants noted that the intention of the noise wall was not to mark the boundary between two adjoining properties. As the applicants put it, ‘the intention of the noise wall [was] to reduce noise’.
By reference to passages in the decisions of Malter v Procopets,[71] Whittlesea,[72] and Malone v La Playa Nominees,[73] the applicants submitted that the judge was wrong to find that the respondent had any intention to possess the land on which the fence was situated. The submission appeared to be that these decisions gave rise to a principle that, in adverse possession cases where possession had been taken by the erection of a fence, the intention of the adverse possessor is only to possess the land inside the fence.

Proposed ground 4: analysis and conclusion

[71][2000] VSCA 11, [5], [7] (‘Malter’).

[72][2009] VSCA 188, [56].

[73][2022] VSC 83, [344], [383] (‘Malone’).

As we have already noted, the judge said that, for the purposes of adverse possession, the intention to possess ‘is established if a person intends to exercise the custody and control they have on their own behalf and for their own benefit’; and ‘that intention may be deduced from the physical acts of possession themselves’.[74] Those statements are, with respect, entirely orthodox and well-supported by this Court’s decision in Whittlesea.[75] Having made these correct statements of principle, the judge then engaged in a detailed analysis of the issue of the respondent’s possession of the relevant parts of the property. In the course of doing so, his Honour rightly rejected a number of arguments which the applicants have put again in this Court.
[74]Reasons [35].
[75][2009] VSCA 188, [5]–[6].
The decision of Cervi is of no assistance to the applicants. Cervi was a case where the conduct of the defendant (the party claiming adverse possession) was held to have lacked consistency. On the evidence in that case, the defendant failed to establish an intention to exclude the true owner of the land from that land during a significant part of the period relied upon to support the claim for adverse possession. To the contrary, in Cervi, the evidence showed that, whenever access to the disputed land (a driveway) was sought by the true owner, the defendant freely granted access, ‘without any expressed qualification, limitation or reservation’. It was in those equivocal circumstances, that the judge in that case (John Dixon J) relied upon the defendant’s failure to assert his right to the land as telling against the defendant having an intention to exclude the true owner.[76] In the present case, however, there was no such equivocation. For the reasons given by the judge, it could not be doubted that the respondent intended to possess the cubical spaces in which the noise wall sat, to the exclusion of the world at large including the applicants.
[76]Cervi (2011) 33 VR 320, 336 [62], 338 [68].
Similarly, the passages the applicants rely upon in Malta, Whittlesea and Malone relating to the intention of the relevant parties in those cases to possess only the land inside the relevant fences, are of no assistance to the applicants. Fundamentally, each case falls to be decided on its own evidence and facts.[77] The fact that evidence in another case might show only an intention to possess land inside a fence and not the land on which the fence sits, says very little about the proper inferences to be drawn in a different case on different evidence.
[77]For completeness, see the expression of this proposition in relation to factual possession in Whittlesea [2009] VSCA 188, [6] and Cervi (2011) 33 VR 320, 326 [18].
Equally, it is not to the point that the purpose of the noise wall was to reduce noise. Nor is it to the point that the original intention was to build the noise wall one metre back from any private land. Nor is it to the point that the respondent might have had an intention to pursue compulsory acquisition under statute if it needed to possess any particular piece of land. While those matters might be capable of consideration, the question his Honour was required to decide was whether, on all of the evidence, the respondent established that it intended to possess the land over which the noise wall protruded into the property to the exclusion of all others. Plainly it did: the only inference available on the evidence was that the construction of the noise wall by the respondent meant that it intended, as his Honour found, to possess the land exclusively. There was no equivocation of the kind evidenced in Cervi. His Honour was correct to conclude that the respondent established the relevant intention to possess.
Proposed ground 4 must be rejected.

Proposed ground 5: is the respondent entitled to rely on any possible right to claim adverse possession vesting in its landlord, the State of Victoria, in defence of the applicants’ claim when the landlord is no longer a party to the proceeding?

Applicants’ submissions

The applicants’ submissions under proposed ground 5 were, in part, premised upon an assertion that the respondent did not claim adverse possession. The applicants observed that, in the respondent’s defence,[78] the applicants pleaded that it was the State of Victoria which was entitled to become the registered proprietor of the land upon which the noise wall encroached. The applicants then variously submitted:
•no claim had been made by the respondent ‘to vest any land in it or the State of Victoria’;
•the respondent did not claim that the land upon which the noise wall encroached vested in the respondent in its own name by reason of any adverse possession;
•by reason of the High Court’s decision in Price v Spoor,[79] title is not automatically extinguished at the expiration of the limitation period (title not being extinguished until a claim ‘is successful in vesting the adversely possessed land in the name of the claimant’);
•the State of Victoria, as the owner of the land or the entity entitled to adverse possession, was a necessary party, without whose presence the respondent could not rely upon the provisions of the Act to defeat the applicants’ claims against it;
•the respondent ‘made no claim of adverse possession over the applicants’ land’; and
•‘in circumstances where the State of Victoria has not asserted any right to possession and abandoned any claim for adverse possession upon settling with the applicants, it is estopped from pursuing such a claim at a later date’.
[78]The final form of which was a further amended defence dated 28 September 2020.
[79](2021) 270 CLR 450 (‘Price’).
In support of these submissions, the applicants relied upon passages in Neuberger LJ’s decision in Tower Hamlets LBC v Barrett[80] and this Court’s decision in Hampshire Automotive Centre Pty Ltd v Centre Com (Sunshine) Pty Ltd.[81]

The respondent’s defence

[80][2006] 1 P&CR 9 (‘Tower Hamlets’).

[81](2020) 60 VR 579 (‘Hampshire’).

In order to understand the applicants’ submissions, it is necessary to set out the relevant part of the respondent’s defence — para 11. Paragraph 11 is the respondent’s plea to the allegation made in para 11 of the applicants’ statement of claim.[82]
[82]The final form of which was a further amended statement of claim dated 18 September 2020.
Paragraph 11 of the statement of claim pleaded that the support structures of the noise wall encroached on the property ‘and are a trespass to it’. In response, the respondent pleaded:
(a) it denies paragraph 11;
(b) further, the encroachments admitted in paragraph 10 above occurred at the time of the construction and erection of the noise barrier prior to 29 June 1999;
(c) after 29 June 2014 the plaintiffs and their predecessors in title to the plaintiffs’ land were unable to recover any of the land the subject of the encroachments admitted in paragraph 10 above (the adverse possession land) by operation of section 8 of the Limitation of Actions Act 1958 (Vic);
(d) as and from 29 June 2014 the plaintiffs’ title to the adverse possession land was extinguished by operation of section 18 of the Limitation of Actions Act 1958 (Vic); and
(e) as and from 29 June 2014 the State of Victoria was entitled to become registered as the proprietor of the adverse possession land by reason of the adverse possession of that land by the encroachments admitted in paragraph 10.[83]

Proposed ground 5: analysis and conclusion

[83]Omitting strike outs and underlining.

Price is authority for the proposition that the limitation defence provided by the Act must be pleaded before the remedy of recovery of the land is barred and title is extinguished. To the extent that the applicants submitted that, in addition to pleading the relevant sections of the Act,[84] the respondent needed to obtain a declaration from the Court that time had run and/or the applicants’ title had been extinguished, that submission must be rejected. Nothing in Price required the respondent to do more than was done at first instance to successfully defend the applicants’ trespass claim in relation to the poles and their supporting structures.
[84]Sections 8 and 18 of the Limitation of Actions Act 1958.
Next, the applicants’ contentions that the State of Victoria was a necessary party whose absence at trial deprived the respondent from successfully relying on the provisions of the Act to defeat the trespass claim in respect of the poles and supporting structures must also be rejected. Initially, the State of Victoria was a defendant to the trespass claim. The applicants chose not to pursue the claim initially made against the State of Victoria — letting it out on terms that required the applicants to pay an agreed amount for costs. Unlike Hampshire, where the suit between the named parties had the capacity to affect the legal interests of the owner of relevant property, the present proceeding (constituted as it was between the applicants and the respondent) had no capacity to adversely affect the legal rights of the State of Victoria in the event that the respondent successfully defended the trespass claim. To the extent that any right in the State might have been affected by the trespass claim succeeding, any absence of a necessary party (the State) was a matter properly to be laid at the feet of the applicants as plaintiffs. Put shortly, the absence of the State from the proceeding at trial was no impediment to the respondent pursuing its adverse possession defence of the trespass claim in relation to the poles and supporting structures.
Similarly, the applicants’ submissions that the judge misconstrued Tower Hamlets must be rejected. As Neuberger LJ said, once the necessary number of years of adverse possession has been established, ‘the paper owner loses his title, and someone, either the landlord or the tenant acquires it’:
If it is the landlord who then acquires title, the land is added to the holding comprised in the tenancy; if it is the tenant, then he holds the freehold of the land in possession.[85]
[85]Tower Hamlets [2006] 1 P&CR 9, [90].

The applicants’ submission that the question of who can or should be entitled to registration upon the expiration of the adverse possession years (the tenant or the landlord) had to be determined in the applicants’ proceeding claiming damages for trespass against the respondent, and that the failure of that issue to be pleaded, contested and determined in the proceeding gave rise to an Anshun estoppel [86] must be rejected. The judge having concluded that the adverse possession period has expired and the applicants’ title to the disputed parts of the property extinguished, the dispute (if there be any dispute) between the respondent and its landlord (the State) is one that can be determined in a subsequent proceeding, without either the respondent or the State being the subject of an Anshun estoppel. There is no basis upon which the applicants can sensibly contend that, in the applicants’ proceeding claiming damages and other relief for trespass, it was unreasonable for the respondent or the State not to raise the question of who, between the respondent and the State, was entitled to become registered as the proprietor of the adverse possession land.[87] Moreover, it is to be noted that para 11(e) of the defendant’s defence suggests that there is unlikely to be any dispute between the respondent and the State, about this issue, requiring the adjudication of a Court.[88]
[86]Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 (‘Anshun’). See also Timbercorp Finance Pty ltd (in liquidation) v Collins (2016) 259 CLR 212, 229 [27].
[87]As defined in para 11 of the respondent’s defence.
[88]Until this issue is determined, it is clear that the applicants, for so long as they remain registered proprietors, hold the land subject to ‘any rights subsisting under any adverse possession of the land’ (s 42(2)(b) of the Transfer of Land Act 1958).
In any event, it was not for the applicants to allege or rely upon an ‘Anshun estoppel’ in this proceeding. Such a defence would only arise in a subsequent proceeding in which a party (presumably the State) asserts that it is unreasonable in the context of the first proceeding for the claim not to have been raised in that case.[89]
[89]Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR 507, 517–8 [22].
The applicants’ submission that the State of Victoria abandoned any claim for adverse possession upon settling the present proceeding with the applicants is equally without merit. There is no evidentiary foundation for this submission. Contrary to the applicants’ submission, the State of Victoria’s preparedness to be let out of the proceeding on terms that the applicants pay a fixed amount for costs does not provide any basis upon which it might be asserted that the State has abandoned anything other than an entitlement to a greater sum for costs than that referred to in the settlement agreement. As was correctly observed by the respondent, the settlement agreement does not contain any term by which the State released the applicants from any claims the State might have in respect of the land occupied by the respondent.
Proposed ground 5 must be rejected.

Proposed ground 6: can the ownership of land in Victoria be in limbo or abeyance?

Applicants’ submissions

Under proposed ground 6, the applicants noted that, at the time the State settled with them, the respondent’s defence raised a claim of adverse possession. The applicants then contended that, ‘in circumstances where the State settled with the applicants … fully cognisant of the respondent’s adverse possession claim, it is open to infer that the State had no interest in asserting title’. The applicants’ argument then proceeded:
Where no declaration was sought or made as to who now owns the encroached land, the unavoidable consequence of his Honour’s conclusion, and in circumstances [sic], is that there is no proper owner of the encroached land following the extinguishment of the applicants’ title.
Next, the applicants submitted that paras [89] and [90] of Tower Hamlets, ‘state the law is that ownership of land should not be in limbo or abeyance’. The applicants also submitted that Tower Hamlets was authority for the proposition that the law ‘knows no abstract ownership, as opposed to the right to recover possession’.
Finally (in relation to proposed ground 6), the applicants submitted that, ‘his Honour’s conclusion contradicts the judgment of the majority in Price held that title is not automatically extinguished at the end of the limitation period [sic]’.

Proposed ground 6: analysis and conclusion

The applicants’ submissions under proposed ground 6 must be rejected, largely for the reasons given in respect of proposed ground 5.
There is no basis for the applicants’ contention that it is open to infer that, when the State settled with the applicants, the State had no interest in asserting title. That said, even if such an inference could or should be drawn, for the reasons given in respect of proposed ground 5, the drawing of such an inference is not a basis for overturning the judge’s conclusions and orders.
Contrary to the submissions of the applicants, Tower Hamlets is not authority for any proposition which is an impediment to the respondent relying upon the relevant provisions of the Act to successfully defend the trespass claim made against it. As we have already said, the fact that there might be some issue between the State and the respondent (to be determined in the future) about which of them might be entitled to registration of the land upon which the encroaching parts of the noise wall is situated, is no impediment to the respondent’s defence of the applicants’ claims made against it.
In asserting that the ownership of land ‘should not be in limbo or abeyance’, and that the law ‘knows no abstract ownership, as opposed to the right to recover possession’, the applicants relied upon parts of sentences contained in Neuberger LJ’s judgment in Tower Hamlets. The full sentences in the judgment were as follows:
The ownership of land should not, in my view, be in limbo, or be treated as being in limbo, save where statute requires it.[90]
…
And at para 3-126,[91] it is said that, subject to a possible exception in the case of the Crown, ‘English law knows no abstract ownership, as opposed to the right to recover possession’.[92]
[90]Tower Hamlets [2006] 1 P&CR 9, [90].
[91]Megarry & Wade, The Law of Real Property (6^th ed, 2000).
[92]Tower Hamlets [2006] 1 P&CR 9, [101] (footnote added).
The applicants’ attempt to elevate parts of individual sentences, taken out of context, and which are themselves qualified, must be rejected. This is not the first occasion on which such an attempt has been rejected.[93] For the reasons already given, the parts of the sentences in Neuberger LJ’s judgment do not assist the applicants in the circumstances of this case.
[93]See, eg, White v The Queen (1962) 107 CLR 174, 175 (per Dixon CJ); Aktiebolaget Hässle v Alphapharm Pty Ltd (2002) 212 CLR 411, 446 [87] (per McHugh J), and 459–60 [133] (per Kirby J).
In relation to the applicants’ submissions that the judge’s decision is contrary to the principles identified in Price, these must be rejected for the reasons given with respect to proposed ground 5.
Proposed ground 6 must be rejected.

Proposed ground 7: did VicRoads, as agent for the respondent, acknowledge the applicants’ title to the encroached land?

Applicants’ submissions

In their written case in this Court, the applicants relied upon all of the circumstances which occurred in 2011–2012, together with the circumstances in which they applied for an amendment to their planning permit in 2016, as constituting the respondent’s acknowledgement of title within the meaning of ss 24 and 25 of the Act. The applicants contended that it was apparent from the relevant correspondence passing between the parties that the respondent was ‘fully aware that the applicants were asserting title over the whole of the land’; and that the respondent (through its agent VicRoads), remained silent ‘as to its knowledge that there was a very real possibility that they were occupying the applicants’ land’. Thus, the applicants’ submitted:
In positively indicating that it did not object to the 2012 planning permit, failing to object to the issue of that permit without the recommended conditions or failing to take any steps in relation to the 2016 planning permit application, the respondent should be taken to have acknowledged the applicants’ title and therefore legal right to build on the entirety of their land within the meaning of s 25 of [the Act].
In oral argument, the applicants pursued a more limited claim on the issue of acknowledgment. The applicants accepted that events occurring after the expiration of the limitation period could not give rise to a relevant acknowledgment of title; and that the events of 2016 were ‘merely contextual’. In oral argument, the applicants relied upon the VicRoads letter of 8 October 2012, addressed to the Moreland City Council, as constituting the relevant acknowledgement of title. That letter relevantly provided:
Thank you for forwarding planning permit application spear MPS/2011/0677 pursuant to Section 52 of the Planning and Environment Act 1987.
…
VicRoads has reviewed the application and associated plans and does not object to the application with the following recommended conditions being included in any Notice of Decision to issue a Planning Permit or Planning Permit:
1.Before the development starts, amended plans must be submitted to and approved by the Responsible Authority & VicRoads to show the northern fence line set back by 1.0 metre from the existing noise wall columns for maintenance purposes. … [94]
[94](Emphasis in original.)
The applicants submitted that the 8 October letter, in the context of all of the circumstances of this case, ‘led to the unavoidable inference that the applicants’ title was acknowledged by the respondent, or VicRoads as its agent’.

Proposed ground 7: analysis and conclusion

Nowhere in VicRoads letter of 8 October 2012 was there any express acknowledgement of the applicants’ title to the land upon which the posts of the noise wall and their supporting structures encroached. The applicants’ case was that the 8 October letter, in the context of all of the facts and circumstances of the planning application, contained an implied acknowledgement of the applicants’ title. We disagree.
Far from impliedly acknowledging the applicants’ title to the now disputed land, in its letter of 8 October 2012, VicRoads required a condition preventing the applicants from developing the property within one metre of the noise wall and its columns. The fact that VicRoads required this condition ‘for maintenance purposes’, rather than because it asserted that the now disputed land belonged to the respondent, is of no assistance to the applicants. The short point is that, in seeking the condition it sought, VicRoads did not impliedly acknowledge the applicants’ title to the land on which the noise wall poles and supporting structures encroached. As the judge said, the position may have been different, ‘if by the letter VicRoads had communicated to [the applicants] that CityLink did not object to [the applicants] constructing units to the boundary’.[95]
[95]Reasons [82].
Proposed ground 7 must be rejected.

Conclusion

The application for leave to appeal must be refused.
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[2022] VSCA 266

5 December 2022