Campbell v McGrath - [2005] NSWSC 496

No judgment structure available for this case.

CITATION:
Campbell v McGrath [2005] NSWSC 496

HEARING DATE(S): 19/04/05, 20/04/05, 21/04/05

JUDGMENT DATE :

27 May 2005

JURISDICTION:
Equity Division

JUDGMENT OF:
Barrett J

DECISION:
Short minutes to be brought in

CATCHWORDS:
REAL PROPERTY - easements - sale and transfer of adjoining lots (Lot 6 and Lot 12) by common vendor to separate purchasers - contracts and completion simultaneous - whether purchaser of Lot 12 agreed to grant purchaser of Lot 6 right of way over existing driveway on Lot 12 servicing Lot 6 - whether easement created by estoppel - whether easement over Lot 12 in favour of Lot 6 arose by implication of law under rule in Wheeldon v Burrows as applied in cases of simultaneous sale and conveyance

LEGISLATION CITED:
Conveyancing Act 1919, ss.7, 23C, 54A
Limitation Act 1969, s.23
Real Property Act 1900, s.42

CASES CITED:
Aldridge v Wright [1929] 2 KB 117
Allen v Taylor (1880) 16 ChD 355
Australian Hi-Fi Publications v Gehl [1979] 2 NSWLR 618
Bahr v Nicolay (No 2) (1988) 164 CLR 604
Borman v Griffith [1930] 1 Ch 493
Bowers v Kennedy 2000 SC 555
Breskvar v Wall (1974) 126 CLR 376
Costagliola v English (1969) 210 Estates Gazette 1425
Eisman v Tamer (formerly known as Uygurer) (SCNSW, Cowdroy AJ, 16 December 1996, unreported);
Finlayson v Campbell (1997) NSW ConvR 55-825
Fraser v Walker [1967] 1 AC 569
Hansford v Jago [1921] 1 Ch 322
Howitt v Fitzgerald (1898) 24 VLR 387
Kebewar Pty Ltd v Harkin (1987) 9 NSWLR 738
Nelson v Walker (1910) 10 CLR 560
PT Ltd & Anor v Maradona Pty Ltd (No 2) (1992) 27 NSWLR 241
Steven and Evans v Allan and Armanasco (1955) 58 WALR 1
Tarrrant v Zandstra (1973) 1 BPR 9381
Walton Stores (Interstate) Ltd v Maher (1988) 164 CLR 387
Ward v Kirkland [1967] 1 Ch 194
Wheeldon v Burrows (1879) 12 Ch D 31
Wilcox v Richardson (1997) 43 NSWLR 4
Williams v State Transit Authority (2004) 60 NSWLR 286

PARTIES:
Leonard Joseph Campbell - First Plaintiff
Margaret Anne Campbell - Second Plaintiff
Edward Bruce McGrath - First Defendant
Margaret June McGrath - Second Defendant

FILE NUMBER(S):
SC 3897/01

COUNSEL:
Mr J.M. Ireland QC/Mr M.D. Seymour - Plaintiffs
Mr B. DeBuse - Defendants

SOLICITORS:
Martin Trisley - Plaintiffs
Armstrongs - Defendants

LOWER COURT JURISDICTION:

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

BARRETT J

FRIDAY, 27 MAY 2005

3897/01 – LEONARD JAMES CAMPBELL & ANOR v EDWARD BRUCE McGRATH & ANOR

JUDGMENT

Background

1 The plaintiffs, Mr and Mrs Campbell, are the registered proprietors under the Real Property Act 1900 of a property bounded on the north by The Boulevarde, Toronto, to which it has its street frontage. This property is described as Lot 6 in Deposited Plan No. 656671. The defendants, Mr and Mrs McGrath, are the registered proprietors under that Act of a property bounded on the south by Brighton Avenue, Toronto, to which it has its street frontage. That property is described as Lot 12 in Deposited Plan No. 4292. The properties have a common boundary. The southern (or rear) boundary of the plaintiffs’ property corresponds with the northern (or rear) boundary of the defendants’ property. Also relevant to the proceedings is a property in other ownership adjoining the plaintiffs’ property to the east which is described as Lot 20 in Deposited Plan No. 301366. It will be convenient to refer to these properties by their lot numbers.

2 By their further amended statement of claim, the plaintiffs claim:

(a) a declaration that the plaintiffs are entitled to a right of way over part of Lot 12, being a strip of land twelve feet wide running in a northerly direction from Brighton Avenue along the eastern boundary of Lot 12 to the rear boundary of Lot 12, being the common boundary of Lot 12 and Lot 6;

(b) an order that the defendants execute an instrument in registrable form for the purposes of the Real Property Act granting to the plaintiffs a right of carriageway appurtenant to Lot 6 affecting that strip of land within Lot 12;

(c) orders restraining the defendants from preventing the plaintiffs and persons authorised by them from using and having access over the strip of land; and

(d) an order referring to a Master the question of the damages suffered by the plaintiffs in consequence of the defendants’ refusal to allow the plaintiffs to use the strip of land.

3 The claimed right of way would provide access to the back of the plaintiffs’ Lot 6 from Brighton Avenue across the defendants’ Lot 12. There is a formed vehicular track in the relevant location. It was referred to in the course of the proceedings as “the driveway”.

4 The defendants deny the entitlement of the plaintiffs to the relief sought. They have filed a cross-claim to be mentioned presently.

5 The plaintiffs purchased Lot 6 in 1980. The defendants purchased Lot 12 at the same time. The vendor of both lots was Mrs Chiplin. Each lot was a subdivided lot the subject of a separate certificate of title before Mrs Chiplin transferred one lot to the plaintiffs and the other to the defendants. The respective transactions with Mrs Chiplin were a consequence of one of the plaintiffs, Mr Campbell, becoming aware that Mrs Chiplin wished to sell her property consisting of two lots. As a result of discussions between the first plaintiff, Mr Campbell, and the first defendant, Mr McGrath, Mrs Chiplin contracted to sell one lot (Lot 6) to the plaintiffs for $95,000 and the other (Lot 12) to the defendants for $40,000. It is suggested that the two contracts were expressed to be interdependent with one another but there are difficulties in making any firm finding to that effect. It is clear, nevertheless, that both contracts were made at or about the same time. It is also clear that the two transfers bear the same date, 9 September 1980, from which it may safely be inferred that both purchases were completed on that day

6 The strip of land within Lot 12 that is at the centre of the proceedings is burdened by a right of carriageway created by a memorandum of transfer dated 12 December 1925 (registered as B307680), as is an elongation of the strip for a distance of some 15 feet in a northerly direction into Lot 6. The dominant tenement in respect of the right of carriageway thus burdening both part of Lot 12 and part of Lot 6 is Lot 20. This right of carriageway provides access to Lot 20 from Brighton Avenue across the defendants’ Lot 12 and the plaintiffs’ Lot 6. It is the contention of the plaintiffs that they, as the registered proprietors of Lot 6, are entitled to an equivalent right of carriageway over the part of the site of the right of carriageway appurtenant to Lot 20 that lies within Lot 12, the dominant tenement in respect of the right of carriageway they thus claim being Lot 6.

The plaintiffs’ case

7 The plaintiffs’ case is, in the first instance, that there was either an express oral agreement or an implied agreement between the plaintiffs and the defendants, made or arising when the plaintiffs bought Lot 6 and the defendants bought Lot 12 from a single vendor (Mrs Chiplin), that an easement in the nature of a right of way would be granted by the defendants to the plaintiffs as a necessary incident of the respective transfers from that vendor. The plaintiffs also rely on an alleged estoppel.

8 The plaintiffs next rely on the proposition that the transaction between the plaintiffs and Mrs Chiplin and the transaction between the defendants and Mrs Chiplin, taken together, were the source of an implication at law of a right of way burdening Lot 12 and benefiting Lot 6.

9 The defendants, by the amended defence, deny the plaintiffs’ entitlement to any easement over Lot 12 in favour of Lot 6 by agreement, estoppel or implication. Their contention is further advanced on three bases: first, that the plaintiffs lost any equitable interest in the easement on entering into an oral licence with the defendants to use the right of way or by laches; secondly, that the alleged agreement being in respect of an interest in land is unenforceable by reason of the Conveyancing Act 1919 (ss. 54A and 23C); and thirdly, that the plaintiffs’ claims in equity are analogous to claims to enforce an agreement and thereby statute barred: Limitation Act 1969, s. 23.

10 The defendants’ cross-claim against the plaintiffs seeks the removal of a caveat lodged by the plantiffs in respect of Lot 12 and mesne profits to the value of the alleged licence fee for the period from February 1996 to April 2002.

An express or implied agreement based on the draft special conditions?

11 Some twenty-five years have passed since the sale and transfer of Lot 6 to the plaintiffs and Lot 12 defendants. The practitioners involved in the conveyancing were Mr Ian Campbell (a clerk with the firm Baker Love & Geddes acting for both the plaintiffs and the defendants as purchasers) and Mr John Chiplin (a solicitor in sole practice acting for his mother, the vendor, Mrs Chiplin). Relevant files and office records have, in each case, been destroyed in the ordinary course of document management. Ian Campbell and John Chiplin are now both dead. The passage of time has naturally affected precise recollection by witnesses.

12 The surviving and available documentary evidence includes a draft version of special conditions for the respective contracts for purchase from Mrs Chiplin. The draft special conditions are found in a letter from John Chiplin to the plaintiffs dated 3 April 1980. Specifically, the draft special conditions for the plaintiffs’ contract state:

13 The draft special conditions for the defendants’ contract (also enclosed with John Chiplin’s letter to the plaintiffs) provide:

14 It will be clear at once that the inclusion of terms reflecting the draft special conditions in the executed contracts is critical to the plaintiffs’ claim of an express or implied agreement, whereby the defendants would grant to the plaintiffs the right of way over Lot 12 in favour of Lot 6.

15 The wife of the late John Chiplin, Mrs Louise Chiplin, was then the secretary for his practice. When shown the draft special conditions for both proposed contracts enclosed with John Chiplin’s letter to the plaintiffs, Louise Chiplin confirmed that she had typed them. She could not recall whether she typed any other versions of the special conditions, but assumed that the draft special conditions had been duly incorporated in the respective contracts.

16 None of the witnesses recalled sighting any special condition in either executed contract. The defendants deny having had knowledge of the draft special conditions relating to the transfer of a right of way over Lot 12 in favour Lot 6. That the first plaintiff, Mr Leonard Campbell, could not recall providing a copy of the draft special conditions to the defendants after receiving them from Mr Chiplin seems consistent with the defendants’ alleged ignorance about the draft special conditions.

17 Any special conditions concerning the right of way in favour of Lot 6 in the executed contracts would have differed, to some extent, from the draft special conditions. The incomplete references to the names of the purchasers make incorporation of the draft special conditions without further modification improbable. The draft special condition clearly required the plaintiffs to make a positive election to have the transfer, to bear the expense of preparing the transfer in registrable form and to seek approval from the vendor Mrs Chiplin of the precise form of grant. That there was never any express grant would support either the absence of the draft special condition concerning the right of way in favour of Lot 6 from the executed contracts, or the failure of the plaintiffs to take the specified steps to secure their alleged entitlement to the right of way in accordance with a special condition modelled on the draft version.

18 The fact that the two contracts were made at about the same time might indicate a likelihood of the inclusion of the draft special condition concerning interdependence. But in light of the nature of the draft special conditions concerning a right of way and lack of proof and recollection about the terms of the executed contracts, there is insufficient evidence to ground a positive finding of inclusion of a special condition in the respective contracts for a grant of the right of way over Lot 12 in favour of Lot 6. Consequently, the plaintiffs’ claim for an express or implied agreement based on the draft special condition cannot succeed and I approach the remainder of the case on the basis that the contracts did not include special conditions regarding creation of a right of way.

Observations regarding Lot 20

19 At all material times before the time of the 1980 transactions, the family of the second plaintiff, Mrs Campbell, owned Lot 20. The plaintiffs themselves occupied Lot 20 when the transactions were entered into. Perhaps as a matter of family arrangement, the plaintiffs, having become owners and occupiers of Lot 6, also used the right of way enjoyed by Lot 20 over Lot 12. Indeed, Mrs Campbell in cross-examination said:

“Q. … Lot 20, was that owned by your father or your father and your brother?
A. Originally it was owned by my father and my brother and then my father took over his half and then did it with my mother.

Q. And then when your father died –
A. It came into my brother and sister and myself.

Q. … So from your perspective, it was always going to be possible whilst your family owned lot 20 to use the right of way in any event because lot 20 had the right of way?
A. Yes. ….

Q. And whilst you had the right of way as a tenant, you had used that right of way for access to Lot 20?
A. Yes.
Q. And when you purchased lot 6, there was no practical reason why you couldn’t keep on using it because your father owned lot 20?
A. That’s right.”

20 Both the plaintiffs deposed that, during Mrs Chiplin’s ownership of Lots 6 and 12, the tenants of Lot 6, their employees, suppliers and customers had used the driveway to access Lot 6. Such use of the driveway reflects convenient access to Lot 6 that was permitted by Mrs Chiplin as the owner of Lots 6 and 12 together.

21 It is likely that the late Ian Campbell erroneously advised the plaintiffs that their Lot 6 had a right of way over Lot 12. This is apparent from two letters from the plaintiffs’ subsequent solicitors, Trisley Kilmurray O’Sullivan to Armstrongs (solicitors for the defendants) and to Baker Love (successors to Baker Love & Geddes), both dated 17 July 1998. The letter to Armstrongs said at para 17:

22 The letter to Baker Love said at paras 4-5:

23 Both plaintiffs confirmed receipt of such advice. Mr Campbell (the first plaintiff) said in cross-examination:

“Q. ... You see there, paragraph 4: ‘We are instructed by our client that Ian Campbell advised them that lot 6 already had a benefit of the right of way over lot 12 and that there was no need to take another grant’. Do you see that?
A. Yes, I see that.

Q. Is that what Mr Campbell advised you?
A. Yes I believe so.

…

24 Mrs Campbell deposed that Ian Campbell provided her with the original as formal documentation for the alleged right of way over Lot 12 appurtenant to Lot 6:

An express oral agreement based on the alleged meeting?

25 The plaintiffs also claim an express oral agreement that the defendants would grant the alleged easement. This claim is based on controversial evidence about the role of Ian Campbell in acting for the plaintiffs and the defendants in their respective purchases from Mrs Chiplin. The second plaintiff, Mrs Campbell, deposed that she and her husband never received documents relating to the sale of Lot 12, nor provided those documents to the defendants. But Mrs Campbell’s recollections about interactions with Ian Campbell were often speculative. For example:

“Q. And then when did you see Mr Campbell for the first time, or the only time, when did you see Mr Campbell in relation to this matter?
A. I’m sorry, I couldn’t tell you exactly when we did, but we did see him several times.

Q. You saw him several times?
A. Well, because you don’t buy a property without having a few conversations.

26 The first plaintiff, Mr Leonard Campbell, says that he never gave the defendants documents relating to the purchase of the properties. However, in cross-examination, Mr Campbell confirmed having liaised between the defendants and Ian Campbell to facilitate the defendants’ purchase. This seems consistent with the defendants’ evidence that they had no interaction with Ian Campbell. Indeed, the defendants said that all documents in relation to their purchase requiring execution were delivered to Mr McGrath by Mr Campbell at the defendants’ then place of business, and Mr McGrath would return the documents to Ian Campbell via Mr Campbell.

27 I am not satisfied that the defendants had no interaction with Ian Campbell during the whole of conveyancing transaction. It is more likely that they had minimal interaction with Ian Campbell, given their familiarity with Lot 12 and the conveyancing transaction being relatively free from complication. The defendants may have communicated with Ian Campbell by telephone or mail as well as via Mr Leonard Campbell. That the plaintiffs received draft special conditions for both contracts from Mr Chiplin is relevant only to their being informed of the interdependent nature of their contract, and does not bear upon the alleged role of Mr Leonard Campbell as the liaison between Ian Campbell and the defendants.

28 The plaintiffs say that Ian Campbell explained about the right of way over Lot 12 in favour of Lot 6 at a meeting on the driveway attended by Mr Chiplin, the plaintiffs and the defendants (and, of course, Ian Campbell) in mid-1980. The defendants say that no such meeting occurred and maintain that they had no contact with and never spoke to Ian Campbell until meeting him at a birthday party quite some time after the completion of the two purchases.

29 Inconsistencies in the plaintiffs’ accounts highlight the inadequacy of their evidence concerning Ian Campbell. For example, they swore affidavits to the effect that Ian Campbell read aloud from what the plaintiffs believed to be the memorandum of transfer B307680 which created in favour of Lot 20 the right of carriageway over Lots 6 and 12. However, on cross-examination Mr Campbell said that Ian Campbell was holding a plan and survey report and that he never saw the document held by Ian Campbell. Whereas Mr Campbell did not recall John Chiplin saying anything at the alleged meeting, Mrs Campbell asserted that John Chiplin helped Ian Campbell to explain the implications of the easement to the purchasers. Although the plaintiffs said that the meeting took place in April 1980, Ian Campbell dated the meeting in late June 1980. In cross-examination and re-examination, Mr Campbell admitted that he had no independent recollection of the meeting. Moreover, in their pursuit of a possible professional negligence claim against Baker Love, the plaintiffs never instructed their solicitors about the alleged meeting despite its clear relevance to any such claim.

30 I prefer the evidence of the defendants concerning the role of Ian Campbell. Their assertion that they were never informed about the right of way over their Lot 12 in favour of Lot 6 is consistent with the instructions later given by the plaintiffs to Trisley Kilmurray O’Sullivan, as evidenced by the letters from Trisley to Armstrongs and Baker Love quoted at paragraphs [21] and [22] above.

31 I am not persuaded that the alleged meeting on the driveway took place. Evidence about the meeting suffers from inconsistency between the accounts of those witnesses who deposed that the meeting took place. Even if the meeting did occur, it is by no means clear that Ian Campbell, with or without the assistance of John Chiplin, explained to the defendants that Lot 12 was or would be burdened by a right of way in favour of Lot 6. I therefore do not accept the plaintiffs’ submissions that there was an oral agreement that the defendants would grant the right of way in favour of Lot 6.

The Statute of Frauds

32 The defendants contend that even if there was an implied agreement as a result of the draft special conditions and the alleged meeting, there is no memorandum or note in writing as required by ss.54A and 23C of the Conveyancing Act. Section 54A(1) provides:

33 Section 23C(1) provides:

34 Mr J. M. Ireland QC for the plaintiffs advanced two submissions on this point: first, that the implied agreement was not one for the sale or disposition of land, but an agreement to create an easement and therefore outside s.54A; and, second, insofar as writing may be required, an inference should be drawn that there was a written contract signed by the defendants which included the special conditions, applicable to the contract for the creation of the easement.

35 The term “disposition” is widely defined under s.7 of the Conveyancing Act and at law: PT Ltd & Anor v Maradona Pty Ltd (No 2) (1992) 27 NSWLR 241 at 249-250 (Giles J). It has been held that an agreement to create or release an easement qualifies as a “disposition of land”: see Eisman v Tamer (formerly known as Uygurer) (SCNSW, Cowdroy AJ, 16 December 1996, unreported); Finlayson v Campbell (1997) NSW ConvR 55-825. A requirement for writing applies accordingly in relation to any express agreement to the effect that the defendants would grant to the plaintiffs a right of way over Lot 12 in favour of Lot 6.

36 Absent any written record of the alleged meeting on the driveway, any agreement arising from that meeting is unenforceable. It is perhaps arguable that the letter from John Chiplin to the plaintiffs containing draft special conditions may constitute the necessary “memorandum or note” for s.54A but the view I take is that that has not been shown to have involved anything beyond an idea or proposal communicated by John Chiplin to the plaintiffs. There is nothing to support a finding that the defendants accepted or subscribed to it. John Chiplin’s authority was authority from the vendor, Mrs Chiplin, alone.

Easement by estoppel

37 The plaintiffs’ estoppel claim is advanced on the following alternative bases:

(a) that there was an implied agreement by the defendants to allow the plaintiffs as purchasers of Lot 6 to use the right of way over Lot 12 (appurtenant to Lot 20) for access to Lot 6; the defendants’ conduct in allowing the plaintiffs, the tenants of Lot 6 and their employees, suppliers and customers from time to time, to use the right of way was part performance of the implied agreement; and it would be unconscionable for the defendants to resile from the agreement by restraining such user; or

(b) that the defendants induced the plaintiffs to assume that they were entitled to use the right of way and it would be unconscionable for the defendants to deny the assumption as the plaintiffs relied on the assumption to their detriment.

38 I consider the two bases separately. There is no credible evidence of any implied agreement by the defendants to allow the plaintiffs and other persons authorised by them to enjoy the benefit of the right of way over Lot 12. I have already found that there was no meeting between the plaintiffs, the defendants and their respective legal advisers at which Ian Campbell explained about an existing right of way over Lot 12 in favour of Lot 6. Moreover, the first plaintiff, Mr Leonard Campbell, admitted in cross-examination that he never felt the need to discuss an easement over Lot 12 for Lot 6 with Mr McGrath, and did not do so prior to their dispute in 1995 which has resulted in these proceedings. The plaintiffs’ claim of estoppel based on the implied agreement fails accordingly.

39 On the alternative estoppel claim, I find that the defendants acquiesced in the plaintiffs’ use of the driveway in a spirit of neighbourliness at all relevant times. In particular, the first defendant, Mr McGrath, said in evidence:

“Q. And through the whole of that period for eight years, you never once complained to the Campbells about the use of the driveway to gain access to their property?
A. No.

40 Such acquiescence falls short of the clear and precise representation by the defendants required for equitable estoppel: Walton Stores (Interstate) Ltd v Maher (1988) 164 CLR 387. In particular, the defendants say that they never consented to Robert Cameron, Jennifer Monaghan, Katherine Gavenlock, Maxine Hannon and Kenneth Edwards (all former tenants of Lot 6) using the right of way over Lot 12 for access to and egress from Lot 6. Hence, there was no relevant reliance on the alleged assumption that the plaintiffs were entitled to use the right of way. Indeed, Mr DeBuse of counsel for the defendants submitted that any reliance by the plaintiffs resulted from their independent belief that Lot 6 had a right of way. I accept that submission and refer to my findings on the plaintiffs’ subjective expectations about their purchase in paragraphs [19] to [24] above.

41 The estoppel claim does not succeed.

Oral licence, laches and statute of limitations

42 As I have found against the existence of any agreement as claimed by the plaintiffs, it is unnecessary to consider submissions of the defendants in relation to oral licence, defence of laches, and expiry of applicable limitation periods.

Easement by implication

43 The plaintiffs contend that there was an implied grant by the vendor Mrs Chiplin of a right of way over Lot 12 in favour of Lot 6, along with a corresponding implied imposition of burden in the transfer of Lot 12 to the defendants. Specifically, the plaintiffs rely upon the rule in Wheeldon v Burrows (1879) 12 Ch D 31, where Thesiger LJ (at p 49) laid down two “rules”:

“The first of these rules is, that on the grant by the owner of a tenement of part of that tenement as it is then used and enjoyed, there will pass to the grantee all those continuous and apparent easements (by which, of course, I mean quasi-easements), or, in other words, all those easements which are necessary to the reasonable enjoyment of the property granted, and which have been and are at the time of the grant used by the owners of the entirety for the benefit of the part granted. The second proposition is that, if the grantor intends to reserve any right over the tenement granted, it is his duty to reserve it expressly in the grant.”

44 The plaintiffs rely on the first of these rules. As stated by Thesiger LJ, the rule operates where the following elements exist: first, “the grant by the owner of a tenement of part of that tenement”; second, grant of the part “as it is then used and enjoyed”; third, the existence of “continuous and apparent easements” or “quasi-easements”; fourth, that those easements “are reasonably necessary to the property granted”; and, fifth, that the easements “have been and are at the time of the grant used by the owners of the entirety for the benefit of the part granted”.

45 Applied to the present case, these elements direct attention to various matters of fact prevailing at the time Mrs Chiplin transferred Lot 6 to the plaintiffs. For the purposes of Thesiger LJ’s first rule, I am satisfied that Lot 6 and Lot 12, when together owned by Mrs Chiplin, constituted a single “tenement” and that Lot 6 was “a part of that tenement”. There was no submission to the contrary. Nor was there any submission that Lot 6 was not transferred by Mrs Chiplin to the plaintiffs as it was “then used and enjoyed”. It is therefore necessary to decide whether:

(a) there existed, at the time of that transfer, any “continuous and apparent” easement or “quasi-easement” affecting Lot 12 and benefiting Lot 6;

(b) any such easement or “quasi-easement” was “reasonably necessary to the property granted”, being Lot 6; and

(c) any such easement was at the time of transfer (and had been previously) used by Mrs Chiplin for the benefit of Lot 6.

“Quasi-easement”

46 Thesiger LJ’s reference to “quasi-easements” was explained by Isaacs J in Nelson v Walker (1910) 10 CLR 560 (at p.582) as follows:

“Quasi-easements are such things enjoyed de facto during unity of possession as would, had unity not existed, have been easements.”

47 The matter was the subject of an interpolation by Russell J in Hansford v Jago [1921] 1 Ch 322 (at p.335) into the statement by Thesiger LJ:

“and the interpretation there interposed [by Thesiger LJ’s reference to ‘quasi-easements’] is necessary, because, where the owner of two tenements grants one of them, there can be no easement at the moment of the grant over the other tenement, the two tenements having belonged to one and the same person, and an easement being a right over the land of somebody else.”

48 An example of the existence of “quasi-easements” bearing a strong resemblance to the facts of this case is given at paragraph 10908 of Butterworths’ “Conveyancing Service New South Wales”:

“For example, suppose that First Street and Second Street are parallel streets, Blackacre faces First Street and Whiteacre faces Second Street, so that the rear of Blackacre and Whiteacre adjoin. Suppose too, that whilst Blackacre and Whiteacre are in common ownership there is an open and apparent path across Whiteacre from the rear of Blackacre to Second Street, and another path across Blackacre from the rear of Whiteacre to First Street. These paths are not easements because the lands are in the sole ownership.”

“Continuous and apparent”

49 The requirement that the user be “continuous and apparent” has been interpreted generously, in that the element of “continuity” has largely been ignored: see Borman v Griffith [1930] 1 Ch 493 where Maugham J (at 499) held that a right of way will not fail the test in Wheeldon v Burrows for lack of continuous user. To qualify as “apparent”, the use must have been discoverable upon an inspection of the servient tenement. In Hansford v Jago (above), Russell J said (at p.338):

“Now what is required in the case of a quasi-easement is the quality of being apparent. That quality may be arrived at in different ways, and, no doubt, the easiest case is that of a made-up road; it is most important, if not essential, that the road should be made up when it is sought to establish the apparency of a quasi-easement of way over an unenclosed piece of land. But when every other possible indication is present as here and they all point to a defined and enclosed strip having been set aside to provide an access to the rear of certain houses, I certainly decline to hold, unless compelled to do so by authority, that the absence of a made-up road prevented the establishment of an implied grant.”

50 At the time the parties entered into their respective contracts and took their respective transfers from Mrs Chiplin, they were familiar with Lots 6 and 12 because of the proximity of their homes and business premises to Mrs Chiplin’s property. The first plaintiff, Mr Campbell, had visited Lot 20 since 1953. The plaintiffs lived on Lot 20 from 1957 to 1966, and conducted a newsagency business there from 1961 to 1981. The first defendant, Mr McGrath, had conducted an upholstery business at 8 The Boulevarde, Toronto from 1976. The business had formerly been located in Victory Parade, Toronto. Mr McGrath had been a milkman in the 1960s and his milk run had included the relevant locality.

51 Mr McGrath’s denial of knowledge about the use of the claimed right of way over Lot 12 for Lot 6 at the time of the conveyances is implausible. In his affidavit, he asserted detailed knowledge about the front driveway of Lot 6 (we are dealing in this case with the back driveway):

“…deliveries were made to the front of the ‘Owl Store’ [on Lot 6] in the Boulevarde, particularly milk and related products on a daily basis. ….
I deny there was no suitable place for unloading deliveries at the front of Lot 6, the Campbell land in The Boulevarde. There has always been a driveway from the carriageway of the Boulevarde to the front of the Campbell land at its Boulevarde frontage. There was sufficient room to park a delivery vehicle on what was then a grass verge without impeding pedestrian traffic on the concrete footpath. There was a driveway in the gutter specifically for that purpose. The footpath area was remodelled in about 1993, but vehicular access is still permitted from the carriageway of the Boulevarde …”

52 Mr McGrath ultimately conceded knowledge of the situation at the back of Lot 6 in cross-examination.

“Q. And you knew, didn’t you, from your milk run activities and other familiarity with the area, that the driveway which starts at Brighton Avenue was being used for deliveries to what was then the supermarket on lot 6. You knew that in 1980?
A. I don’t know what deliveries were made from the rear of the property in 1980, before, I can’t say, but I know what happened in the front.

….

Q. I want to suggest to you, Mr McGrath, that you knew perfectly well, in the seventies, that the entrance from Brighton Avenue to Mrs Chiplin’s land was being used by both delivery vehicles and customers attending the supermarket premises [ie, Lot 6]. Do you agree or disagree?
A. There could have been. Yes, there was. I’m not saying there wasn’t.

….

Q. And you knew that immediately prior to that sale, I want to put to you, the entry from Brighton Avenue had been regularly used for both deliveries and for customer parking for the business located on lot 6; you knew that, didn’t you?
A. It was a communal driveway. You have been talking about the driveway. It was a communal driveway. …

53 According to the evidence of the plaintiffs, the front driveway of Lot 6 (off The Boulevarde) was limited in terms of parking capacity for larger commercial delivery vehicles and during times when the traffic on The Boulevarde was busy. Based on the plaintiffs’ familiarity with Lots 6 and 12 as neighbours, I accept that they observed Mrs Chiplin, her family members, the tenants of Lot 6 and their employees, suppliers and customers, regularly using the driveway over Lot 12 to access Lot 6 while both lots were owned by Mrs Chiplin. Such user – eventually conceded by Mr McGrath – is corroborated by the affidavit evidence of Ms Garven who had been a tenant of Lot 12 and employee of the supermarket on Lot 6; and the evidence of Louise Chiplin in cross examination and re-examination, which is extracted below.

54 Louise Chiplin said in cross-examination:

“Q. Can you remember seeing delivery trucks in front of lot 2 and 4 of The Boulevarde?
A. No. I have only seen delivery trucks at the back. The times that I was there with my husband, I have seen them at the back. I have never seen them at the front, back then. Not back then, no.

….

Q. How often did you go with your husband to The Boulevarde?
A. Well, to the front or the back?

55 Louise Chiplin said in re-examination:

“Q. You said in an answer to my learned friend that you would stay in the car when your husband was collecting rent. Where was that?
A. That would be at the back. He would drive down to the back of the – from Brighton Avenue, down the right of way to the back

Q. Did that happen once or more than once?
A. More than once.

Q. Was it on those –
A. Every time.

56 That the claimed right of way is visible and permanent, in the sense of being a formed vehicular track or driveway (a matter not, I think, in dispute), further supports a finding that the relevant user was sufficiently continuous and apparent: Steven and Evans v Allan and Armanasco (1955) 58 WALR 1 at 15 and Ward v Kirkland [1967] 1 Ch 194 at 225-226.

“Reasonably necessary to the property granted”

57 This part of Thesiger LJ’s test is satisfied if it is shown that the claimed easement is reasonably necessary to the enjoyment in a reasonable manner of some permanent feature or part of the transferred part of the single parcel. Earlier authority requiring essentiality may be put to one side in New South Wales in light of the decision of the Court of Appeal in Wilcox v Richardson (1997) 43 NSWLR 4. After discussing earlier cases, Handley JA said (at pp.14-15):

“The true test, implicit in the general authorities, and explicit in Wheeldon v Burrows , is the more liberal test of whether the implied rights were ‘necessary to the reasonable enjoyment of the property granted’. The difference is significant, because rights which are not necessary for the operation of a business may be necessary for its reasonable operation and hence for the reasonable enjoyment of land leased for that business. Expressed in other words, such rights may be needed "to give such business efficacy to the transaction as must have been intended at all events by both parties who are business men": The Moorcock (1889) 14 PD 64 at 68.

It is clear from the judgment of Thesiger LJ that the test of what is necessary for the purpose of the rule in Wheeldon v Burrows is not the strict test relevant for the implication of an easement of necessity: see also Wheeler v J J Saunders Ltd [1996] Ch 19 at 31, per Peter Gibson LJ. What is necessary for this rule is what ‘conduces to the reasonable enjoyment of property’ (ibid).
Moreover in Schwann v Cotton [1916] 2 Ch 459 at 469, Lord Cozens-Hardy MR said: ‘The word necessary must not be taken in a rigid sense. The better phrase is that which is used by Lord Campbell ... “convenient and comfortable enjoyment of the property” ....’

58 The concept of “reasonably necessary” was explained by Meagher JA by means of an example (at p.8):

59 What is, in this sense, “reasonably necessary” is to be determined by reference to physical features of the land and improvements, including their use. Lot 6, as I have said, has a frontage to The Boulevarde which is the main street of Toronto. In the usual way, shops and business premises line the main street. The premises on Lot 6 are of this kind. As already noticed, there is a small off-street driveway for vehicles at the front of the premises on Lot 6 (by the front, of course, I mean the frontage to The Boulevarde). As evidence previously mentioned shows, however, persons visiting Lot 6 for business purposes (particularly persons with vehicles) have habitually entered the premises at the back, crossing Lot 12 along the driveway from Brighton Avenue.

60 The evidence about the limited capacity of the front driveway to Lot 6 and habitual resort to the back driveway by persons visiting Lot 6 justifies, in my view, a finding that the claimed right of way over Lot 12 is necessary for the reasonable enjoyment of Lot 6. The plaintiffs do not say that the front driveway is unusable but merely that it is unsuitable for unloading substantial deliveries and during times of busy traffic on The Boulevarde; and that it cannot accommodate delivery and customer vehicles in the way they can be accommodated at the back. Substantial deliveries and access by customers wishing to park at the back of the retail premises on Lot 6, coupled with the fact that The Boulevarde is the main shopping street of Toronto, supports the reality that most deliveries to Lot 6 have had to be received from the rear via the claimed right of way and many customers and visitors will use it, as the only available carriageway to Lot 6 from Brighton Avenue.

61 Mr DeBuse submitted that the right of way has been and is unnecessary for the reasonable enjoyment of Lot 6 by its present occupant, Paul Murphy trading as Hunter Valley Design, who accesses the premises only from The Boulevarde. The evidence concerning Paul Murphy is derived second-hand from the affidavit of Stephen Churches, who was not cross-examined. Notwithstanding the untested and hearsay nature of the evidence concerning Paul Murphy, his subjective enjoyment is temporary by virtue of the term of his lease and arguably of limited relevance to the test. The evidence discloses a history of commercial use for the premises on Lot 6. In particular, the premises of Lot 6 have accommodated inter alia, a supermarket and newsagency business, both of which received deliveries via the claimed right of way. In Wilcox v Richardson, as I have said, the Court of Appeal held that the claimed right of way need only be reasonably necessary and not essential.

62 I find the claimed right of way reasonably necessary to the enjoyment of Lot 6. It makes no difference, in my view, that Lot 6 had been vacant from a date in 1979 up to the time it was conveyed to the plaintiffs. The temporary non-use of a quasi-easement of the relevant kind does not matter. I refer, in that connection, to the decision of Megarry J in Costagliola v English (1969) 210 Estates Gazette 1425. The report is cast in the third person. I quote from page 1429:

“At the time of the conveyance 10 or 11 months had elapsed since Mr. Mutimer had left, and the use of the lane and track for vehicles had abated. But he (Megarry, J.) did not think that an established means of access which for less than a year ceased to be actively enjoyed to any great extent thereby ceased to be a quasi-easement. It still remained a visible and useful way for vehicles.”

But Mrs Chiplin did not retain Lot 12

63 I refer next to the important point that Mrs Chiplin did not retain the putative servient tenement (Lot 12) when she transferred the putative dominant tenement (Lot 6) to the plaintiffs: she conveyed it to the defendants by transfer of the same date as the transfer to the plaintiffs. That, however, does not detract from the operation of the rules with respect to easements implied by reference to the principle in Wheeldon v Burrows. Rather, it brings into play a variant stated in the following terms by Greer LJ in Aldridge v Wright [1929] 2 KB 117 (at p.131):

“Where an owner executes contemporaneous conveyances of adjoining plots with the houses erected on them, and there exists a made road across the land of one plot to an entrance to the house on the other plot, and it is proved that the road was constructed for the use of both houses, there will be implied a grant in the one conveyance of a right to use the road and a corresponding reservation in the other conveyance.”

64 One of the cases quoted by Greer LJ in support of this proposition is Hansford v Jago (above) where a row of houses that shared a common rear pathway leading to a street were sold at auction to different purchasers on the same day. Russell J, after referring to the rule in Wheeldon v Burrows in a passage to which I have earlier referred (at paragraph [43] above), said (at p.335):

“These principles prima facie apply to the present case subject to the question whether they apply when there has not been a sale of part and a retention of another part of a tenement but a sale of the whole by simultaneous sales to different persons. It seems to me to be clear on the authorities that the same principles do apply.”

65 Russell J referred to a number of decided cases, including the decision of Sir George Jessel MR in Allen v Taylor (1880) 16 ChD 355 in which simultaneous sales of two properties by one vendor to separate purchasers with simultaneous conveyances was regarded as “one transaction” in equity.

66 Also instructive, in this connection, is the decision of the Full Court of the Supreme Court of Victoria in Howitt v Fitzgerald (1898) 24 VLR 387. That case involved lots in a subdivision effected by the Crown. A drainage channel benefiting one or more lots and running through other lots existed before the subdivision. Lots enjoying the benefit of the drain and lots through which it ran were, according to the statement of facts in the report, “sold and granted on the same day by the Crown to the respective purchasrs”. That circumstance was the basis for a submission described by the Court (Madden CJ, Williams and a’Beckett JJ) as follows (at p.396):

“It is contended that there was then a continuous and apparent easement over the lands through which the drain ran, entitling the Crown grantee of the allotments which afterwards became the plaintiff’s to have the drain kept open over the other allotments by virtue of the well-recognized principle applied to ordinary vendors who subdivide and sell property one part of which can only be fully enjoyed by exercising rights over another part.”

67 The Court said in relation to this submission:

Gale on Easements

if he sells the two tenements to two different persons at the same time, the service which one rendered to the other, if it was continuous and apparent at the time of the sale, becomes permanent, and the owner of the servient tenement cannot deprive the dominant tenement of the advantage theretofore possessed

68 In cases of simultaneous (or near simultaneous) transfer of two relevant parcels to different purchasers, each of whom takes knowing of the other transaction, it will be presumed that the common transferor intends not only that the transferee of the putative dominant tenement is to have rights in respect of the putative servient tenement but also that the transferee of the latter is to take subject to the corresponding burden; while corresponding and parallel intentions will be imputed to the respective transferees. There is, in those circumstances, an inference as to the transferor’s intention both to burden and to benefit and as to the intentions of the respective transferees to take from the transferor accordingly. In Bowers v Kennedy 2000 SC 555, the Inner House of the Court of Session had before it a situation in which vendors (“the Lamberts”) had sold Wynton Knackery to a chemical company and the adjoining Wynton Farm to Troup upon break-up of an estate and sale of parts by auction. The conveyance of Wynton Farm was made on 8 January 1945 and that of Wynton Knackery on 16 January 1945. After reviewing Scottish authority similar to Wheeldon v Burrows, the court (the Lord President (Rodger), Lord Kirkwood and Lord Allanbridge) said (at [19] – [20]):

“[19] In the light of these authorities we regard it as clear that, if the Lamberts had simply disponed the Knackery to the chemical company and had retained the surrounding farm land, then the chemical company would have obtained an implied right of access to the Knackery. To put the point another way, the Lamberts would impliedly have reserved a right of access to the Knackery. Moreover, if nothing had been said, the access would have been by the route which had been used before the lands were split up. The wording of the disposition to the chemical company suggests that the access road across the farm to the Knackery had been used to obtain access before 1945. So, it appears that, if nothing had been said, the chemical company would have been entitled to access along the same access road.

Russel v Watts

Hansford v Jago

Easements

69 Paragraph 20 of that judgment shows that the “contemporaneous conveyance” principle upon which these decisions proceed does not depend upon strict simultaneity. It applies where there is, as a matter of reality, a composite dealing with two parcels involving transfers to two transferees who take at or about the same time, with each taking in the knowledge that the other is taking and of the relevant physical features of the land. Those elements exist here. The close link between the two transactions came from the circumstances in which they were negotiated and the contracts were exchanged (with Mrs Chiplin willing only to dispose of both lots together and the plaintiffs having brought in the defendants as buyers of the lot the plaintiffs did not want), coupled with the fact that each transfer bears the same date (9 September 1980) from which it may safely be inferred that completion of both transactions took place at the same time.

70 The circumstances of this case therefore warrant a finding of not only an intention on the part of Mrs Chiplin that the defendants should take Lot 12 from her subject to the quasi-easement represented by the vehicular track providing access over Lot 12 to Lot 6 and that the plaintiffs should take Lot 6 with the benefit of that quasi-easement, but also corresponding intentions of the defendants and the plaintiffs as the transferees of the respective lots from Mrs Chiplin under the transfers dated 9 September 1980.

71 The Wheeldon v Burrows principles as to implied easements, as they apply in cases of contemporaneous transfer of parts of a single tenement, therefore brought about, in equity, the result that Lot 6 had the benefit of, and Lot 12 was burdened by, the easement for which the plaintiffs contend in these proceedings.

Relevance of the Real Property Act

72 The rule in Wheeldon v Burrows has been recognised as applying to Torrens title land in New South Wales, so far as the creation of unregistered equitable interests is concerned. Courts will enforce an in personam right to an implied easement by ordering actions of the parties necessary to bring about alteration of the register. In Tarrrant v Zandstra (1973) 1 BPR 9381, where all conditions for an implied Wheeldon v Burrows easement were fulfilled, Mahoney J (as he then was) was satisfied that, had the contest been one between the plaintiff and the servient owner at the time the easement arose, the plaintiff would have been entitled to an order that the servient owner execute the necessary documents to give effect to an agreement granting the right of way (at 9384). Mahoney J concluded:

“[i]t is, in my opinion, clear that as between the immediate parties, any equities created by the purported grant of a right-of-way can be enforced.” (at 9390)

73 The Court of Appeal in both Australian Hi-Fi Publications v Gehl [1979] 2 NSWLR 618 at 623-624 (Mahoney JA, Reynolds & Samuels JJA concurring) and Kebewar Pty Ltd v Harkin (1987) 9 NSWLR 738 at 743 (McHugh JA, Samuels & Priestley JJA concurring), accepted this observation of Mahoney J. In the words of Mahoney JA in Australian Hi-Fi Publications v Gehl (at pp.622-623):

“The intention of the Torrens legislation is, as has been authoritatively determined, that title be conferred by registration and that the registered proprietor hold, subject to the register, free from competing interests of the kind referred to in, e.g., s. 42: Fraser v Walker [1967] AC 569; Breskvar v Wall (1971) 126 CLR 376. This does not mean that a party may not enforce any unregistered interests against a registered proprietor. The right to enforce, e.g., equitable rights existing personally against the registered proprietor is well established: Barry v Heider (1914) 19 CLR 197 at 213. ….

Wheeldon v Burrows

74 The principle of indefeasibility of title reflected in s.42 of the Real Property Act does not deny the right of a plaintiff to bring against a registered proprietor a claim in personam for such relief that a court acting in personam may grant: Fraser v Walker [1967] 1 AC 569 at 585; cited in Bahr v Nicolay (No 2) (1988) 164 CLR 604 at 637-638 (Wilson & Toohey JJ). Barwick CJ in Breskvar v Wall (1974) 126 CLR 376 said (at p.385) that the enforcement of rights existing personally against a registered proprietor was “no impairment of the conclusiveness of the register”. The register remains conclusive and, if it is altered by recognition of an instrument brought into existence pursuant to an order of a court, the new form it thereby assumes is likewise conclusive.

75 Because of the simultaneous transfers by Mrs Chiplin, the defendants are not, as against the plaintiffs, “subsequent” owners of the servient Lot 12. As between the plaintiffs and the defendants, the defendants effectively stand in the position of the grantor Mrs Chiplin. Hence, this case fits within the in personam exception to statutory indefeasibility, and the Real Property Act does not prevent enforcement of the implied right of way.

76 Mr DeBuse submitted that Williams v State Transit Authority (2004) 60 NSWLR 286 provides against the enforcement of informal easements such as implied Wheeldon v Burrows easements over Torrens title land. But that case concerned an alleged easement by prescription and it was held that the doctrine of lost modern grant was inadequate to support prescriptive easements arising over Torrens land. The Court of Appeal there had no occasion to consider the in personam exception to statutory indefeasibility and I do not consider the decision to be in any way instructive as to the outcome in this case.

Conclusion

77 In light of the decision that the plaintiffs have succeeded in making good their claim to an easement by implication, it is unnecessary to consider the defendants’ cross-claim for mesne profits.

78 In the result, therefore, the plaintiffs are entitled to relief to the effect described in items (a) to (c) of paragraph [2] above. I direct that short minutes be brought in accordingly within 14 days.

79 As to item (d) of paragraph [2] above, it is not clear to me that the evidence warrants any finding of relevant damage, since the matter received no real attention in submissions. In relation to that aspect, therefore, I direct that, if the plaintiffs press their claim for an order in terms of that item (d), they file by delivery to my Associate within 14 days a statement identifying the evidence adduced in the proceedings by reference to which the claim to relief by way of damages is maintained.

80 As to costs, the normal rule would indicate an order that the defendants pay the plaintiffs’ costs of the proceedings. If the defendants contend that some other costs order is appropriate, they should file written submissions by delivery to my Associate within 14 days. Any submissions of the plaintiffs in response thereto should be filed in like manner within a further 14 days.

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Citations

Campbell v McGrath [2005] NSWSC 496

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CITATION:	Campbell v McGrath [2005] NSWSC 496
HEARING DATE(S):	19/04/05, 20/04/05, 21/04/05
JUDGMENT DATE :	27 May 2005
JURISDICTION:	Equity Division
JUDGMENT OF:	Barrett J
DECISION:	Short minutes to be brought in

CATCHWORDS:	REAL PROPERTY - easements - sale and transfer of adjoining lots (Lot 6 and Lot 12) by common vendor to separate purchasers - contracts and completion simultaneous - whether purchaser of Lot 12 agreed to grant purchaser of Lot 6 right of way over existing driveway on Lot 12 servicing Lot 6 - whether easement created by estoppel - whether easement over Lot 12 in favour of Lot 6 arose by implication of law under rule in Wheeldon v Burrows as applied in cases of simultaneous sale and conveyance
LEGISLATION CITED:	Conveyancing Act 1919, ss.7, 23C, 54A Limitation Act 1969, s.23 Real Property Act 1900, s.42
CASES CITED:	Aldridge v Wright [1929] 2 KB 117 Allen v Taylor (1880) 16 ChD 355 Australian Hi-Fi Publications v Gehl [1979] 2 NSWLR 618 Bahr v Nicolay (No 2) (1988) 164 CLR 604 Borman v Griffith [1930] 1 Ch 493 Bowers v Kennedy 2000 SC 555 Breskvar v Wall (1974) 126 CLR 376 Costagliola v English (1969) 210 Estates Gazette 1425 Eisman v Tamer (formerly known as Uygurer) (SCNSW, Cowdroy AJ, 16 December 1996, unreported); Finlayson v Campbell (1997) NSW ConvR 55-825 Fraser v Walker [1967] 1 AC 569 Hansford v Jago [1921] 1 Ch 322 Howitt v Fitzgerald (1898) 24 VLR 387 Kebewar Pty Ltd v Harkin (1987) 9 NSWLR 738 Nelson v Walker (1910) 10 CLR 560 PT Ltd & Anor v Maradona Pty Ltd (No 2) (1992) 27 NSWLR 241 Steven and Evans v Allan and Armanasco (1955) 58 WALR 1 Tarrrant v Zandstra (1973) 1 BPR 9381 Walton Stores (Interstate) Ltd v Maher (1988) 164 CLR 387 Ward v Kirkland [1967] 1 Ch 194 Wheeldon v Burrows (1879) 12 Ch D 31 Wilcox v Richardson (1997) 43 NSWLR 4 Williams v State Transit Authority (2004) 60 NSWLR 286
PARTIES:	Leonard Joseph Campbell - First Plaintiff Margaret Anne Campbell - Second Plaintiff Edward Bruce McGrath - First Defendant Margaret June McGrath - Second Defendant
FILE NUMBER(S):	SC 3897/01
COUNSEL:	Mr J.M. Ireland QC/Mr M.D. Seymour - Plaintiffs Mr B. DeBuse - Defendants
SOLICITORS:	Martin Trisley - Plaintiffs Armstrongs - Defendants