Gough & ORS. v City of Holdfast Bay - [2013] SADC 170

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil: Interlocutory Application)
GOUGH & ORS. v CITY OF HOLDFAST BAY
[2013] SADC 170
Judgment of His Honour Judge Slattery
13 December 2013
EQUITY - EQUITABLE REMEDIES - INJUNCTIONS - INTERLOCUTORY INJUNCTIONS
Fifteen plaintiffs seek orders for an interlocutory injunction preventing the termination of their tenancies at a caravan park. Each of the plaintiffs claims to be permanent residents of dwellings within the caravan park and assert an entitlement to remain at the caravan park. The defendant submits the Court should not grant the injunction and the balance of convenience does not favour the granting of relief and the plaintiffs should be confined to their remedy in damages. (1) Whether there is a serious issue to be tried, namely that there is a sufficient likelihood of success of the applications to relief at trial. (2) Whether the inconvenience or injury to the plaintiffs would be likely to suffer if an interlocutory injunction is refused, outweighs the injury the respondent would suffer if an injunction is granted. (3) Whether the plaintiffs should be confined to the remedy of damages
Held: Application for an interlocutory injunction granted.
Corporations Land Act 1880 Generally; Public Works Act 1882 Generally; Residential Parks Act 2007 s5, s6, s7, s49, s50, s72 ; Local Government Act (SA) 1999 s200, s202; Local Government Act (New South Wales) s327, s327AA, s328 ; Real Property Act s14, s223LB(4) ; Land Acquisition Act s10(1), s11, s12, s12A; Pollock, Essays in Jurisprudince and Ethics (1882) at 122; Handley: Estoppel by Conduct and Election, Thomson, Sweet and Maxwell 2006 [6-008], p103; Meagher, Gummow and Lehane Equity Doctrines and Remedies 4th edition, 2004 at paragraph [17-075] ; Spencer Bower and Turner on Estoppel by Representation at page 32, referred to.
Bank Negara Indonesia v Philip Hoalim (1973) 3 PCC 27; [1973] 2 NLJ 3 PC; Bonds Brewing (New South Wales) Pty Ltd v Reffell Party Ice Supplies Pty Ltd (unreported 17 August 1987 Waddell CJ in Equity); Hough v The Guardian Fire and Life Assurance Company Ltd (1902) 18 TLR 273; Ismail v Polish Ocean Line [1976] 1 QB 893; Portland Downs Pastoral Co Pty Ltd v Great Northern Developments Pty Ltd [2012] QCA 18; Ramsden v Dyson and Thornton (1865) LR 1 HL 129; 9 App Cas 699; Silovi Pty Ltd v Barbaro (1988) 13 NSWLR 466, discussed.
ABC v O’Neill (2006) 227 CLR 57; ACMNET Pty Ltd v Ai Tel Pty Ltd [2007] SASC 96 ; ASIT Investments Pty Ltd v Koerner (2012) 272 FLR 131; Birmingham and District Land Co v London and North Western Railway Co [1888] 40 Chd 268; Brand v Chris Building Co Pty Ltd [1957] VR 625; Colonial Mutual Life Assurance Society Limited v Producers and Citizens Co-operative Assurance Limited (1931) 46 CLR 41; Commonwealth of Australia v Verwayen (1990) 170 CLR 394; Crabb v Arun District Council [1975] 3 WLR 847; Discount and Finance Limited v Gehrig’s NSW Wines Limited (1940) 40 SR (New South Wales) 598; Ewing International LP v Ausbulk Limited and Anor. (2008) 253 LSJS 195 ; Freeman and Lockyer v Buckhurst Park (Mangel) Pty Ltd [1965] 2 QB; Heatons Transport (St Helens) Ltd v Transport and General Workers Union [1973] AC 15; Hollis v Vabu (2001) 207 CLR 21; Horsfall v The Halifax and Huddersfield Union Banking Co (1883) 52 LGCh 599; Hughes v Metropolitan Railway Co [1877] 2 AC 439 ; Legione v Hateley (1983) 152 CLR 406; Mercantile Co Ltd v Twichings [1976] QB 225; New South Wales v Lepore (2003) 212 CLR 511; New South Wales Trotting Club v Glebe Municipal Council (1937) 37 SR (New South Wales) 288; Northside Developments Pty Ltd v Register General (1989-90) 170 CLR 146; Olson v Dyson (1969) 120 CLR 365; Plimmer and Anor. v The Mayor, Councillors and Citizens of the City of Wellington (1884) 9 App Cas 699 (PC); Pratten v Warringah Shire Council (1969) 90 WM 134; Provincial Insurance Co of Canada v Leduc (1874) LR 6 PC 224; Rogers v Moonta Town Corporation (1981) 55 ALJR 710; Scott v Davis (2000) 204 CLR 333; STA v Apex Quarries Ltd [1988] VR 137 ; State Rail Authority of New South Wales v Heath Outdoor Pty Ltd (1986) 7 NSWLR 170; Sweeney v Boylan Nominees Pty Ltd (2006) 226 CLR 161; Walton Stores (Interstate) v Maher (1988) 164 CLR 387; Ward v Kirkland [1967] 1 Ch V 194; Willmott v Barber (1880) 15 Ch V 96, considered.

GOUGH & ORS. v CITY OF HOLDFAST BAY
[2013] SADC 170
JUDGE SLATTERY

In this action, there are sixteen named plaintiffs although there are only fifteen applicants for Orders for an interlocutory injunction. The sixth named plaintiff, Pamela Bruce, does not seek Orders for an interlocutory injunction and seeks to withdraw from the proceedings.
Apart from one plaintiff, each of the plaintiffs are residents of a Caravan Park called the “Brighton Caravan Park”. That Caravan Park is situated in Kingston Park, on the beachfront, at the very southern end of the inner Adelaide metropolitan beachfront area. For the sake of convenience I will not make any distinction between the plaintiffs on the basis of residency.
Each of the plaintiffs claims to be permanent residents of the Caravan Park. The assertion of an entitlement of each of them to permanent residency in the Caravan Park is the basis upon which these plaintiffs seek interlocutory injunctive Orders from this Court. The Council seeks to remove the plaintiffs from the Caravan Park. The plaintiffs seek orders that the Council be restrained from taking any further steps to evict the plaintiffs from the Caravan Park.
The genesis of this action is that the plaintiffs have received from the City of Holdfast Bay (the Council) notices of termination of their tenancies at the Caravan Park. The notice states that they will be evicted from the Caravan Park on 17 November 2013 unless the residents leave earlier. The urgency of the matter was said to be that the notice of eviction date of 17 November 2013 left the plaintiffs with insufficient time and capacity to take any alternative action. The Council challenges the accuracy of the stated reasons of urgency made by the plaintiffs. The plaintiffs reside in an area of the Caravan Park called the “B Block”. The Caravan Park comprises three principal area of accommodation. The first may be described as “daily hirers”. The second type of occupant have been variously described but are more accurately called “annuals”. These are people who, for an annual fee, rent a site in the Caravan Park.
The third and final type of occupant are what is described as “permanent residents”. These are the plaintiffs. The plaintiffs are persons who have purchased a dwelling on a site in the Caravan Park. They have never purchased any interest in any part of the fee simple of the Caravan Park, any lease interest nor any reversion interest.
The concept of “dwelling” is referable to the Residential Parks Act 2007 (the Act). It is a useful expression which I will continue to use to describe the “premises” in the B Block occupied by the plaintiffs. The dwellings were comprised of caravans and caravans with annexes. The majority of the dwellings are connected to sewage, water and power. As far as I can tell, almost all of these dwellings comprise caravans to which a permanent form of annex is attached.
The dwellings were almost exclusively the permanent homes of the plaintiffs. In some instances, (four plaintiffs)[1] other properties are owned. None of the plaintiffs claim any proprietary interest in the land and none have caveated any interest. The plaintiffs claims are confined to an entitlement in equity to maintain their occupation of the dwelling on the Caravan Park as a consequence of the conduct, the acts of omission and commission of the Council and its alleged agent, Ricklemore Park Pty Ltd (Ricklemore), which managed the Caravan Park between 1981 and 30 June 2013. Ricklemore is not a party to the proceedings.
[1] Darryl Campain, Raffi Osman, Paul Rampling and Gregory Mark Shepherd.
The Council seeks the dismissal of the application for interlocutory injunction on the basis that there is no serious issue to be tried[2] as the test of interlocutory injunctions is now to be understood.[3] Alternatively the submission of the Council is that the plaintiffs should be confined to their remedy in damages[4] because their rights could rise no higher than to be reinstated the funds that they expended on the purchase of the dwellings. The plaintiffs submit that their interest being a right of occupation of a dwelling which is in the nature of a property interest and that they should not be confined to a remedy in damages.
[2] ABC v O’Neill (2006) 227 CLR 57.
[3] Decision of Layton J in ACMNET Pty Ltd v Ai Tel Pty Ltd [2007] SASC 96 at [19]-[21]; Ewing International LP v Ausbulk Limited and Anor. (2008) 253 LSJS 195 at 203 [46]-[47].
[4] STA v Apex Quarries Ltd [1988] VR 137 at 193.
The plaintiffs have not yet filed any pleadings in the proceedings. The Council identified on a number of occasions that in the past 3-4 months the plaintiffs have made public pronouncements about the preparation of proceedings, the intent to issue proceedings, the drafting of a statement of claim of numerous pages, the ongoing intention to issue and serve proceedings and the intention to use the Court resources to protect their claimed interest. Notwithstanding, no explanation has been given by them for the late commencement of these proceedings. That is to be understood in this background. The initial notice was given by the Council to the plaintiffs of the necessity for the plaintiffs to vacate their dwellings by 30 June 2013. That notice was given on 24 January 2013.[5] After some representations were made to the Council on 23 April 2013, the Council resolved to extend the time for the plaintiffs to vacate the dwellings. That resolution was subsequently rescinded on 28 May 2013. After a further extension of time, the Council stipulated that the plaintiffs were to vacate the Caravan Park by 17 November 2013.
[5] Affidavit of Stewart Galliford sworn 27 November 2013 (FDN39).
The Council has appointed a new operator[6] who requires unfettered access to the Caravan Park for clearing of the Caravan Park area and construction of new facilities. Each of the plaintiffs have given undertakings as to damages.
[6] Freespirit Resorts Pty Ltd; management agreement 24 October 2013 (exhibit NX41 to the third affidavit of Nicholas Xenophon sworn 26 November 2013).
The question for my consideration is whether, on the facts as they have been disclosed on the affidavit material, a prima facie case has been made out by the plaintiffs, the balance of convenience favours the grant or otherwise of the injunction and whether the plaintiffs should be confined to their remedy in damages.
On the question of the late commencement of the proceedings, the plaintiffs submit that they are unsophisticated people with very few worldly possessions and little by way of capital to sustain them. I accept that significant effort would have been required to draw together the relevant persons who are involved in these proceedings, to obtain the proper advice and then to prepare and commence proceedings.
Each of the plaintiffs and the Council reads a large volume of affidavit material.[7]
[7] First affidavit of Nicholas Xenophon (FDN2); second affidavit of Nicholas Xenophon (FDN33); third affidavit of Nicholas Xenophon (sworn 26 November 2013 (provided to me in Court)); first affidavit of D. Boss (FDN6); second affidavit of D. Boss (FDN32); first affidavit of J. Brown (FDN7); second affidavit of J. Brown (FDN28); first affidavit of D. Campain (FDN9); second affidavit of D. Campain (FDN29); first affidavit of R. Osman (FDN14); second affidavit of R. Osman (FDN30) first affidavit of C. Marsland (FDN12) and second affidavit of C. Marsland (FDN31).
The plaintiffs also tendered Exhibit P1. It is a book prepared on the topic of the Brighton Caravan Park residents, some of whom are the plaintiffs.
The Council’s affidavit of M. Burton (FDN21); first affidavit of P. Aukett (FDN22); second affidavit of P. Aukett (FDN26); third affidavit of P. Aukett (FDN38) and affidavit of S. Galliford (FDN39).
There was no cross examination and I proceed on the basis that only for this interlocutory hearing I will accept the content of them, subject only to those matters that I have ignored.
Ricklemore managed the Caravan Park from 1981 until 30 June 2013. It was both the lessee and the manager of the Caravan Park. Its principal was Mr Birchmore. Mr Birchmore and his wife were the Directors and shareholders of Ricklemore. As will be seen, Ricklemore plays a significant part in this matter as a result of alleged representations made by Ricklemore to the plaintiffs over a period from prior to 2007. These representations were alleged to have been made by Ricklemore concerning the permanent status of anyone who was living in Area B. It is contended by the plaintiffs that Ricklemore, through Mr Birchmore, informed some of the plaintiffs as they became residents at the Caravan Park, that the tenancy agreement that they were entering into (after the Act was proclaimed) (and as was prescribed by the requirements of the Act) was a mere formality; that, subject only to them fulfilling their obligations of neatness, tidiness and good behaviour, those persons could expect to remain as permanent residents of the Caravan Park for all purposes for the future. The question of how long into the future was never resolved by the evidence. Mr Wells QC submitted that at this stage of an interlocutory injunction it was not necessary for a decision to be made about, the length and extent of the interest of each of the plaintiffs. What was important was that, from the plaintiffs’ point of view, the conduct of the Council, through its own servants and agents including Ricklemore was to be identified as the basis of an assumption formed by the plaintiffs upon which they relied to their detriment.
Summary of the evidence
There are some common themes within the evidence. One of those themes identifies Mr Steve Watson, an employee of the Council. A number of the deponents depose to conversations with Mr Watson prior to entering into their tenancy agreements. Mr Birchmore was the manager “on the ground” of the Caravan Park. Mr Brad and Ms Erica Neeskens and Mr Greg O’Reilly and his wife appear to have been employees of Ricklemore. The plaintiffs Leonard Gough, Jeremy Austin, Steven Blake, Anthony Boss, Mark Farrelly, Vince Murdocco, Raffi Osman and Marilyn Pearson spoke to Mr Birchmore before entering into tenancy agreements.
Those conversations were described as “suitability interviews”.[8] Within those interviews, each tenant was told that if they kept their area clean, and kept paying their rent, then there would be really no problems for them living in the Caravan Park “long-term”. Generally each of the plaintiffs were told that the tenancy agreements were only put into place to allow for rent increases. A second reason suggested for the agreements was that Ricklemore could use the time of renewal of the tenancy agreements to be rid of “undesirables”.[9] Each of the deponents said generally the same thing with respect to the agreements: that there was a right for the manager to terminate at the end of the tenancy period if the view had been formed that a particular tenant was “undesirable”. The plaintiffs placed great emphasis upon the words spoken by Ricklemore to each of the prospective tenants. It formed part of the basis for what is alleged to be an assumption by each of the tenants in relation to their long-term tenancy of the Caravan Park.
[8] The right of occupation under a tenancy was subject to a suitability interview and a probation period. It is not clear what were the benchmarks to be achieved by prospective tenants within the probation period but it is a reasonable inference that prospective tenants needed to be able to get on with their fellow tenants in the area.
[9] It is not clear what is meant by “undesirables” although it may be inferred that “undesirables” include persons who could not keep their premises to the standard required by the manager.
The plaintiffs Jeffrey Brown, Carol Marsland and Giovanni Virgone had conversations with Brad and Erica Neeskens prior to becoming tenants. Each said that they were informed by the Neeskens that, generally, the tenancies would be renewed every year and that the tenants would only be removed from the premises if their behaviour was unacceptable and if they did not properly maintain their premises. Mr Greg Shepherd deposed to the fact that he spoke to a lady prior to signing a tenancy agreement. He was enquiring about whether there were any permanent sites available and he was told by Ricklemore that if he paid his rent on time, behaved properly as a tenant and kept his premises in good order and repair then he could stay there permanently. Generally, those persons who spoke to the Neeskens were told that they could be permanent residents and would keep on getting new tenancy agreements as long as they looked after their premises and paid their rent.
Mr Darryl Campain also spoke to the Neeskens and confirmed that he was looking for a permanent residence. He was also told that as long as he paid the rent and looked after his premises then he would be treated as a permanent resident. Mr Campain informed the Neeskens of the amount of money he was paying for his site ($65,000). Mr Jeffrey Brown was told by the Neeskens that he would be entitled to reside at the permanent site for as long as he wished to.
Mr Greg O’Reilly appears also to have been employed by Ricklemore sometime in 2007 and 2008. In October 2008, the plaintiff Mr Paul Rampling had a conversation with Mr O’Reilly who informed Mr Rampling that if he moved in as a permanent tenant, he was able to install an annex to the caravan onsite because it was a permanent site. Similar to the other conversations, Mr O’Reilly informed Mr Rampling that as long as he paid his rent and looked after the site he could stay as a permanent resident. He was also told on 28 November 2008, the date that he signed his tenancy agreement, that his tenancy agreement was an ongoing formality to mainly keep “undesirables” from coming into or staying at the Caravan Park.
Mr Gough had a conversation with Mr Watson on or about 11 June 2010 about the long-term future of the Caravan Park. Mr Gough alleges that Watson informed him that there were no plans for the Caravan Park other than fireproofing the cabins and refurbishing the toilet block.
Mr Steven Blake spoke to Mr Watson in or about February 2007 and Mr Watson informed him that there had always been permanent residents of the Caravan Park. Mr Blake alleges that Mr Watson also said that there will always be permanent residents at the Caravan Park based upon the steady source of income that sustains the Caravan Park. It appears implicit that the income of the Caravan Park was labile depending upon seasons. Mr Shepherd’s conveyancer had a conversation with Mr Watson some time in or about June 2011 concerning the future of the permanent residents. Mr Watson informed Mr Shepherd’s conveyancer that the management agreement with Ricklemore would end of 30 June 2013 and that any purchase made by Mr Shepherd was only a purchase of the infrastructure and would not include a purchase of an interest in the land.
Mr Raffi Osman spoke with both Mr Birchmore and the Neeskens sometime in early July 2012 and enquired about the possible plans to redevelop the Caravan Park. The Neeskens informed Mr Osman that apart from a new roof on the amenities block, there were no other development plans in place for the Caravan Park and that any development plans would not affect the permanent residents. Soon after Mr Birchmore informed Mr Osman that the “lease” (the tenancy agreement) was only a formality for CPI type rent increases and to keep out “undesirables”. Mr Osman informed Mr Birchmore that he paid $54,000 for his site (in July 2012). The plaintiffs Boss, Rampling, Austin, Gough and Campain were told that the documentation was a “mere formality”.

On the question of alleged subsequent detrimental reliance, it is the case of the plaintiffs’ that, subsequent to the conversations with members of the Council or with Ricklemore, they entered into contracts to purchase the dwelling sites. Prices ranged between about $45,000 to about $85,000. Generally, further money was also outlaid by them to make improvements to the vans in the site.
The Ricklemore Management agreement
The management agreement between the Council and Ricklemore is Exhibit “NX1” to the affidavit of Nicholas Xenophon sworn 8 November 2013 (FDN2). It is dated 23 December 2003. The agreement period is 5 years plus 1 right of renewal of 5 years. The agreement was extended on 8 July 2008 and was due to end on 30 June 2013.
The contention of the plaintiffs is that Ricklemore as the manager of the Caravan Park, was, as an independent contractor, the authorised agent of the Council and that the Council is bound by the representations made by Ricklemore to the plaintiffs. The recitals to the management agreement identifies that Ricklemore had managed the Caravan Park pursuant to a lease agreement between the parties dated 12 May 1998. That lease agreement is not in evidence. The original lease agreement expired on 30 June 2003. The management agreement reflects the fact that the Council had agreed to grant to Ricklemore a new lease of the Caravan Park. Ricklemore had the responsibility to manage the Caravan Park in accordance with the terms of the agreement. The agreement is expressed as follows:-
AGREEMENT
Grant of Lease and Authority to Manage
The Council grants to the company a lease over the property, together with authority and responsibility to manage the Caravan Park:
*For the period stated in Item 4 of Schedule 1; and
*Starting on the dates stated in Item 5 of Schedule 1; and
*On condition that the company meets all of its obligations under this agreement; and
*Subject to the limits of the company’s management power set out in this agreement.
One of the obligations of Ricklemore under the agreement was to make payments to the Council. There are two types of payments. The first is an annual rental payment. It is $10 per year payable on demand, a “peppercorn rent”. The second type of payment is that under Clause 18 of the agreement. This is a payment determined according to turnover.
Under the Clause, Ricklemore is required to pay to the Council an amount equivalent to 55% of the gross turnover of the Caravan Park business. That payment is required to be made on or before the 10^th day of each following calendar month. The amount of turnover rent payable by Ricklemore to the Council was to be not less than $300,000[10] for each 12 month period. In the event that the amount payable on turnover at the rate of 55%[11] was less than $300,000 then the obligation was upon Ricklemore to make up the difference between the turnover rent paid in the amount of $300,000 ten days after the completion of the relevant 12 month period.[12] The Council provided to Ricklemore plant and equipment, fixtures, fittings and buildings upon the site for the purpose of conducting its business.
[10] Clause 18.6.
[11] Clause 18.1.
[12] Clause 18.6 of the agreement.
Ricklemore’s obligations are set out in paragraph 2 of the agreement. Also contained within Schedule 2 on page 24 of the document is this obligation:-
To advertise and promote the property.
Mr Wells QC particularly emphasised this obligation. It must be viewed in the context of the whole of Schedule 2 which sets out the services that are to be provided by Ricklemore.
Under Part 7 of the agreement, Ricklemore acknowledges that it has not acquired any proprietary right in the Caravan Park as a party to the agreement.[13]
[13] Clause 35.
Clause 36 of the agreement reads as follows:-
NO AGENCY
36.1 Unless otherwise agreed by Council in writing, the company (Ricklemore) will not represent to any person that it acts as agent for the Council or has any right or authority other than as granted to it under this agreement.
Clause 6 of the agreement requires Ricklemore to use and manage the Caravan Park as intended. Clause 6.1 requires Ricklemore to use the Caravan Park only for the purposes or activities stated in item 9 of Schedule 1. Item 9 of Schedule 1 described the use of the property as “caravan park and holiday villages”.
Clause 6.2 states that it is agreed between the parties that Ricklemore was engaged by the Council as a contractor to perform the services. The same subparagraph identifies that the relationship between the Council and Ricklemore is that of a principal contractor an independent contractor and that Ricklemore is carrying on its own business in the performance of the agreement with the Council.[14] Ricklemore is to provide the services at the property but the Council also has the right to give directions to Ricklemore in the event that the Council forms the view that urgent action is required to protect any person or property on the Caravan Park.[15]
[14] Agreement clauses 6.2.1, 6.2.2 and 6.2.3.
[15] Clause 6.5 and 6.7 of the agreement.
Under Clause 6.8, Ricklemore is required, at its own costs, to comply with all reasonable direction given by the “Superintendant” regarding the performance of the services and Ricklemore is required to regularly liaise and consult with the Superintendent in relation to the scope and nature of the services.[16] The term “Superintendant” is defined within Clause 1 of the agreement as follows:-
Superintendant means any officer or person authorised by the Council and notified to the company (Ricklemore) as an authorised officer to carry out the terms of this agreement on the Council’s behalf.
[16] Clause 6.8 of the agreement.
Ricklemore is also required to keep the Superintendant fully informed of everything which Ricklemore, in its reasonable opinion, considers will affect or be likely to affect the Council and which may come to the Council’s attention.[17]
[17] Agreement clause 6.10.
The Council granted to Ricklemore for the duration of the agreement the use of and enjoyment of the Council’s improvements, fixtures, fittings and chattels located within the property.[18] There is no conveyance of the proprietorship or any interest in the Council’s improvements, fixtures, fittings and chattels located within the property. Ricklemore is required to regularly liaise and consult with the Superintendant.
[18] Clause 6.11.
Schedule 3 of the agreement sets out the special conditions under the agreement. Schedule 3 is referred to within the agreement at Clause 47 which states that the special conditions are incorporated into the agreement and prevail to the extent of any inconsistency.
Clause 13 of Schedule 3 reads as follows:-
13. Permanent Sites.
13.1 the maximum number of permanent sites at any time is limited to 32.
13.2 in this clause (permanent sites) means sites occupied by guests who use their caravan as their home and nominate the caravan park as their main place of residence. The expression “permanent sites” does not include:
13.2.1 Sites (commonly referred to “annuals”) which are reserved for persons who leave their caravans on a long term basis but who use this site for holidays, not as their main residence or normal place of abode; and
13.2.2 Persons who stay at a site for an extended period whilst they are looking for a new permanent home, building a new home or staying at the caravan park on a seasonable basis.
The agreement thus identifies that there are 32 permanent sites. The meaning of permanent sites is described as guests using the caravan on the site “as their home and as their main place of residence”.
The plaintiffs’ claim – legal and equitable principals
The claim of the plaintiffs is summarised as follows: the Council and Ricklemore are to be seen as essentially the same party so that when Ricklemore made representations to the residents, it did so on behalf of itself as well as on behalf of the Council. After it made the representations, it knew that the plaintiffs outlaid money on the purchase of a dwelling in Area B of the Caravan Park. Ricklemore actually knew of the sale and purchase of the dwellings. It also knew that the statements to the prospective purchasers were matters to be taken into account by the prospective purchasers. It also knew that substantial amounts of money were being paid to purchase the dwellings on the land. This process of sale and purchase of dwellings has been described as an “aftermarket”. It is also alleged by the plaintiffs that the representative of the Council and in particular Mr Watson made particular representations to the potential purchasers about the longevity of the right of the purchasers to remain within Area B as permanent residents. Following those representations, the plaintiffs set about the purchase of the dwellings.
The plaintiffs allege that having spoken with Mr Birchmore, the manager and with senior employees of the Council, the plaintiffs had a clear understanding of the permanence of their entitlement to remain, infuturo, in the dwellings on the sites. This in turn reflected the value of the dwellings which the plaintiffs were purchasing as well as the belief in each of the plaintiffs that their position would not change despite any plans that the Council may have for redevelopment of the Caravan Park land at any time in the future. The plaintiffs also contend that the Council had actual knowledge of the sale and purchase of the dwelling and that it was in the interests of the Council to encourage the sale and purchase of dwellings. It is contended by the plaintiffs that the Council encouraged the sale and purchase of dwellings. The general benefit to the Council was that the permanent residents created a steady cash flow during the leaner winter months. This in turn meant that there was a greater likelihood of the Council receiving above the sum of $300,000 on the turnover rent basis.
The authorities relied on by the plaintiffs
Ramsden v Dyson and Thornton[19] concerned statements made by stewards and agents of Ramsden that led Thornton to take a lease of portion of Ramsden’s land, place a building upon it, pay rent and amend the rent agreement to a tenancy at will, all in the expectation that a grant of a long term lease would be made by Ramsden to Thornton. Ramsden claimed to have no knowledge of these events and he refused to grant the lease.
[19] (1865) LR 1 HL 129; 9 App Cas 699.
After stating the relevant principles, the Lord Chancellor said as follows:-[20]
But it will be observed that to raise such an equity two things are required, first, that the plaintiff expending the money supposes himself to be building on his own land; and, secondly that the real owner at the time of the expenditure knows that the land belongs to him and not to the person expending the money in the belief that he is the owner. For if a stranger builds on my land knowing it to be mine, there is no principle of equity which would prevent my claim in the land with the benefit of all of the expenditure made on it. There would be nothing in my conduct active or passive making it inequitable in me to assert my legal right… if my tenant builds on land which he holds under me, he does not thereby, in the absence of special circumstances, acquire any right to prevent me from taking possession of the land and buildings when the tenancy has determined. He knew the extent of his interest and it was his folly to expend money upon a title which he knew would or might soon come to an end.
[20] 9 App Cas 699 at 141.
In the decision of Lord Kingsdown, the following formulation appears:-[21]
If a man under a verbal agreement with a landlord for a certain interest in law or, what amounts to the same thing, under an expectation created or encouraged by the landlord that he shall have a certain interest, takes possession of such land with the consent of the landlord, and upon the faith of such promise or expectation, with the knowledge of the landlord and without objection by him, lays out money upon the land, a Court of equity will compel the landlord to give effect to such promise or expectation. This was the principal of the decision in Gregory v Mighell and, as I conceive, is open to no doubt. If at the hearing of the cause there appears to be such uncertainty as to the particular terms of the contract as might prevent a Court of equity from giving relief if the contract had been in writing but there had been no expenditure, a Court of equity will nevertheless, in the case which is above stated, interfere in order to prevent fraud, although there has been a difference of opinion amongst great Judges as to the nature of the relief to be granted. Lord Thurlow seems to have thought that the Court would ascertain the terms by reference to the Master and if they could not be ascertained with fixed reasonable terms. Lord Alvanley and Lord Redesdale and perhaps Lord Eldon thought this was going too far; but I do not understand any doubt to have been entertained by any of them that, either in the former base for specific interest in the land or in the shape of compensation for the expenditure, a Court of equity would give relief and protect in the meantime the possession of the tenants. If, on the other hand, a tenant being in possession of land and knowing the nature and extent of his interest, lays out money upon it in the hope or expectation of an expended term or in allowance for expenditure, then, if such hope or expectation has not been created or encouraged by the landlord, the tenant has no claim which any Court of law or equity can enforce…
[21] 9 App Cas 699 at 711.
Plimmer and Anor. v The Mayor, Councillors and Citizens of the City of Wellington[22] concerned land that was vested under the operation of the Wellington Harbour Board and Corporations Land Act 1880. Plimmer claimed compensation under the Public Works Act 1882 because he had an estate or interest in the land. Plimmer had erected a wharf on land in 1848. In 1855 he erected a jetty, all at his own cost and with the permission of the Government. In 1856, the Government requested him to extend his jetty and to erect a warehouse on the wharf. The Government used the wharf and the jetty and other improvements on the land for a fee. The extended jetty was built at the cost of Plimmer. The land then became vested in the respondents by a Statute which came into force in September 1880 and in April 1881 they brought ejectment. There was no defence to the ejectment proceedings and so the respondents took possession of the jetty in 1882.
[22] (1884) 9 App Cas 699 (PC).
Their Lordships then gave consideration to the application of Ramsden v Dyson and in particular Lord Cranworth’s judgment. Different to the situation in Ramsden v Dyson and Thornton, in Plimmer, the landowner had, for his own purposes, requested the tenant to make the improvements. This was because the Government had a particular purpose for the use of the jetty namely the introduction of immigrants to the colony and the supply of the colony in order to maintain the livelihood of immigrants. The Privy Council held[23] that the case fell within the principle stated by Lord Kingsdown in Ramsden v Dyson because of the expectations created or encouraged by the owner. And in addition the owner had required the expenditure by Plimmer. The licence given to Plimmer was irrevocable.
[23] At page 713.
The Privy Council appeal decision in Bank Negara Indonesia v Philip Hoalim[24] concerned a solicitor, Hoalim, who occupied a room in a building at 3 Malacca Street Singapore. He occupied a room in the building since 1945. The room is described as having been located in the front portion of the first floor of the building which then comprised ground floor, first floor and second floors. Up until 1959, the building was owned by Lee Cheng Kiat. In 1957, when Hoalim was a monthly tenant paying $147.40 per month, the owner, Kiat, entered into negotiations with the Bank to sell the building. Those negotiations were successful and the building was conveyed to the Bank in July 1959.
[24] (1973) 3 PCC 27; [1973] 2 NLJ 3 PC.
In 1958 Hoalim was forced to move his rooms because of renovations. He did so only on Kiat’s promise that once the renovations were finished he could move back to the front of the building, he would have Rent Ordinance Protection and he could not be asked to leave so long as he was practicing his profession as a solicitor from the building. In 1961 he also negotiated a new lease with the new owner, the Bank, and paid an increased rent.
The Privy Council held that because of the two promises that were made by Kiat’s representatives to Hoalim,[25] the doctrine of promissory estoppel applied and quoted with approval Lord Cairns LC in Hughes v Metropolitan Railway Co[26] and Birmingham and District Land Co v London and North Western Railway Co.[27] The Privy Council held that because Hoalim entered into a legal arrangement which was less favourable than which he previously enjoyed between 1945 and 1958 only as a result of the assurances given by the previous registered proprietor, he should have the benefit of an equity protecting him in the new position in which he reaped. The Privy Council expressed their view in the following manner:-
Their Lordships therefore consider that, during the initial period after the respondent had moved to the third floor, he enjoyed the benefit of an estoppel which would prevent the appellants from availing themselves of their legal right to remove him so long as he carried on his profession there.[28]
[25] (1) that if Hoalim moved to the third floor he would enjoy the same protections as he enjoyed in respect of the first floor under the ordinance; (2) that so long as he continued to practice his profession then Hoalim would not be asked to leave by the Bank.
[26] [1877] 2 AC 439 at 448.
[27] [1888] 40 Chd 268 at 286 per Bowen LJ.
[28] At page 4.
The Privy Council did not consider that the negotiation that occurred in 1961 which led to the increase rent paid by Hoalim in any sense constituted a waiver. The estoppel created by Kiat’s conduct bound the Bank.
Although it is not clear what status might be enjoyed by the decision of Bank Negara Indonesia v Phillip Hoalim, it is the case that the decision of the Privy Council was cited with approval by Brennan J and Gaudron J in Walton Stores (Interstate) v Maher.[29] The status is a little unclear because in a number of Australian authorities, different Judges have cited this case as authority for quite different propositions. Compare for example the decision of McHugh JA on the one hand and Kirby J and Glass JA on the other in State Rail Authority of New South Wales v Heath Outdoor Pty Ltd (1986) 7 NSWLR 170.
[29] (1988) 164 CLR 387 at pages 420 and 459.
In Bonds Brewing (New South Wales) Pty Ltd v Reffell Party Ice Supplies Pty Ltd (unreported 17 August 1987 Waddell CJ in Equity) the facts were that Tooheys Limited owned many hotels in New South Wales generally leased under 12 month leases. The hotels changed hands at very high values based upon the perceived value of goodwill. In respect of the New Brighton Hotel at Manly, Tooheys Limited, as landlord, gave notice that a 12 month lease which had converted to a monthly tenancy was to terminate and a notice to quit was provided. The landlord took proceedings for possession and the question was whether there was any estoppel arising as between the landlord and the tenant concerning the question of the payment of goodwill. The tenant claimed an entitlement to be paid goodwill. The landlord denied the claim.
After considering all of the documentary evidence, Waddell CJ held that between about 1970 to about 1985, when the plaintiff sought to gain possession of one of its hotels which was subject to one of the brewery leases (the 12 month leases) then it paid substantial compensation to the outgoing tenant for goodwill. This was notwithstanding that the outgoing tenant was merely holding over on a monthly or weekly tenancy. This practice continued even after the Council had issued what was described as a “goodwill letter” which stated specifically to all tenants that the plaintiff was not obliged to pay for goodwill if it gave notice to tenants of their eviction. The payments for goodwill were also expressed as being attributable to the value of the tenant’s equity as a tenant in the premises.

A practice grew up as between the plaintiff and tenant lessees. At page 9, Waddell CJ held as follows:-
The documentary evidence establishes in my opinion that the practice of the plaintiff, in the case of any hotel doing a substantial trade, was to consider offers made by a tenant to purchase the freehold against its assessment of the value of its own interest in the premises, a figure which recognised the value of the tenant’s interest or equity. The plaintiff’s approach to the negotiation of these sales seems to me to be completely consistent with its approach in cases where it required vacant possession of premises for the purpose of sale to a third party.
A Mr Casey was employed as the landlord’s regional property manager. Mr Casey conducted transfer interviews for the brewery when a lessee introduced to the plaintiff brewery an intending purchaser of the lease. These interviews occurred in the background of what was called the goodwill letter.
Mr Casey conducted the interview with the intending purchaser and he was required to get the goodwill letter signed by the intending purchaser so that, consequently, there would be no rights as between the intending purchaser and brewery in the event that the brewery gave notice to quit to the intending purchaser. Mr Casey was asked about the letter in about 90% of all brewery interviews. His evidence was that it was his standard response that if the purpose of the letter was queried then he would say that it had to be signed. He would say to the prospective purchasers that it was no more than a mere formality: “because Tooheys over the years had sold 20 or 25 managed hotels, they had received the goodwill for those hotels selling most of them by tender.”[30] Waddell CJ had some difficulty comprehending this evidence but characterised the evidence to mean that Mr Casey: “…meant to convey the impression that if the hotel was sold the tenant would get the value of his goodwill.”[31]
[30] Judgment page 10.
[31] Judgment page 10.
In so doing, Mr Casey disobeyed the specific instructions given to him by his employer and he readily conceded in cross examination that his statement was false. He conceded that by telling the tenants that the letter was a mere formality, he was in breach of his instructions by the brewery.
After further considering the evidence, Waddell CJ said:-
Generally speaking, the oral evidence indicates a general perception in the hotel industry that the letter did not represent a threat to an intending lessee that he would lose his goodwill in the event that the plaintiff sought possession of the premises except in the instances already mentioned where it was made known to the lessee that the plaintiff had plans to sell the hotel at the time he was negotiating or had entered into a contract to purchase the lease.
At page 13 of the judgment, Waddell CJ held as follows:-
The general principles which are, in my opinion, applicable to the circumstances of this case are set out in the judgment of Mason and Deane JJ in Legione v Hateley (1983) 152 CLR 406 at 430-2.
Notwithstanding their diverse origins one may discern a common principle underlying the established emanations of estoppel in pais. The classic statement of that principle is that of Dixon J in Thompson v Palmer: “the object of estoppel in pais is to prevent an unjust departure by one person from an assumption adopted by another as the basis of some act or omission which, unless the assumption be adhered to, would operate to that other’s detriment. Whether a departure by a party from the assumption should be considered unjust and inadmissible depends on the part taken by him and occasioning its adoption by the other parties. He may be required to abide by the assumption because it formed a conventional basis upon which the parties entered into contractual or other mutual relations…; or because he has exercised against the other party rights which would exist only if the assumption were correct… (citations omitted).
Or because knowing the mistake the other laboured under, he refrained from correcting him when it was his duty to do so; or because of his imprudence, where care was required of him, was approximate cause of the other parties adopting and acting upon the faith of the assumption; or because he directly made representations upon which the other party founded the assumption. But, in each case, he is not bound to adhere to the assumption unless, as a result of adopting it as the basis of action or inaction, the other party would have placed himself in a position of material disadvantage if departure from the assumption is be permitted.
For present purposes two comments need to be made upon the above statement of the recognised grounds of preclusion… the first is that reference to an unjust departure was not seen by Dixon J as a charter for idiosyncratic concepts of justice and fairness. His Honour… said: “the justice of an estoppel is not established by the fact in itself that a state of affairs has been assumed as the basis of action or inaction and that a departure from the assumption would turn the action or inaction into a detrimental change of position. It depends also on the manner in which the assumption as been occasioned is induced. Before anyone can be estopped, he must have played such a part in the adoption of the assumption that it would be unfair or unjust if he were left free to ignore it. But the law does not leave such a question of fairness of justice at large. It defines with more or less completeness the kinds of participation in the making or acceptance of the assumption that will suffice to preclude the party if the other requirements for an estoppel are satisfied.
That question for the Judge was whether the assurance given by Mr Casey which caused the Council not to take the (goodwill) letter at face value make it unjust for the plaintiff to depart from the assumption made by the Council. His Honour found that Casey did not have any actual authority from the plaintiff to say that the letter was merely a formality. His specific instructions were to make no comment on it. However his Honour found that merely because Casey had no apparent or ostensible authority was not the end of the matter and properly addressed, the question was whether the plaintiff brewery was bound by what he said for the purposes of assessing the part which he played in the making of the assumption by the Council which led it to purchase the lease of the premises. Waddell CJ thought that it did.
His Honour then concluded[32] that, because of the actions of Casey were to be seen as the actions of the brewery, then the plaintiff had participated in the making of the assumption on which the Council acted and that was sufficient to lead to a conclusion that it would be unjust now to allow the plaintiff to depart from the assumption.
[32] Judgment page 16.
In the Commonwealth of Australia v Verwayen,[33] Deane J set out what he described as the conceptual foundation and essential operation of the doctrine of estoppel by conduct. The passages are well known and do not need to be set out here. I have taken them into account in reaching my decision in this matter.
[33] (1990) 170 CLR 394 at 443-446.
In his decision in Silovi Pty Ltd v Barbaro (1988) 13 NSWLR 466, Priestley JA at page 472 made a comparison of the features of equitable estoppel and common law estoppel. He said as follows:-
The following can I think be distilled from the reasons in Waltons notwithstanding the somewhat different language used by different Judges. (1) Common law and equitable estoppel are separate categories, although they have many ideas in common. (2) Common law estoppel operates upon a representation of existing fact, and when certain conditions are fulfilled, establishes a state of affairs by reference to which the legal relation between the parties is to be decided. This estoppel does not itself create a right against the party estopped. The right flows from the court's decision on the state of affairs established by the estoppel. (3) Equitable estoppel operates upon representations or promises as to future conduct, including promises about legal relations. When certain conditions are fulfilled, this kind of estoppel is itself an equity, a source of legal obligation. (4) Cases described as estoppel by encouragement, estoppel by acquiescence, proprietary estoppel and promissory estoppel are all species of equitable estoppel. (5) For equitable estoppel to operate … there must be the creation or encouragement by the Council in the plaintiff of an assumption that a contract will come into existence or a promise be performed, and reliance on that by the plaintiff, in circumstances where departure from the assumption by the Council would be unconscionable. (6) Equitable estoppel may lead to the plaintiff acquiring an estate or interest in land; that is, in the common metaphor, it may be a “sword”. (7) The remedy granted to satisfy the equity (which either is the estoppel or created by it) will be what is necessary to prevent detriment resulting from the unconscionable conduct…
I make particular reference to paragraph (7) as described by Priestley JA. The plaintiff’s position is that they seek a remedy to satisfy the equity based upon the state of affairs as established by the estoppel. There was no real contest between the parties that equity is in a position to fashion a form of remedy based on a state of affairs as they existed between the parties. The essential question therefore is the establishment (or not) of that state of affairs.
The Residential Parks Act
In the second reading speech in the Legislative Council, the Honourable GE Gago (Minister for Environment and Conservation) moved that the Bill be read a second time and said inter alia that:-
…the Government has been mindful of the need to strike a reasonable balance between the interests of residents and those of park owners. The park is the lawful property of the park owner but it is at the same time the permanent home of the residents. The landlord/tenant model was therefore judged to be a fair and sensible basis for regulating their respective rights…[34]
[34] At page 676.
In the Act, the interpretation provision identifies a “dwelling” as a structure whether fixed or moveable for use as human habitation. It can include a motor vehicle or trailer designed for such use.
A “Park owner” of a residential park (the Caravan Park is for all purposes a residential park) is defined to mean the owner or operator of the residential park. The submissions of the plaintiffs were that this disjunctive “or” must be read as “either or” so that the reference to the owner or the operator was, in effect, interchangeable as between them. The plaintiffs’ submission of the involvement of both an operator (Ricklemore) and an owner (the Council) of the Caravan Park at the same time concerned whether Ricklemore was a privy of the Council in this context.
The Council contends that the word “or” between owner and operator within the definition operates as a disjunctive only and does not operate to mean “either or”. The definition identifies that there may be an owner who deals with the residents in the Caravan Park or there may be an operator dealing with the residents in the Caravan Park (acting on its own behalf under some other arrangement). In my view, on this interlocutory application it is not appropriate, nor is it necessary, that I resolve that issue. These contrasting arguments are put and must be resolved at trial.
“Residential park agreement” means a residential park tenancy agreement or a residential park site agreement. A residential park site agreement means an agreement under which a park owner grants another person, for valuable consideration a right (not necessarily exclusive) to occupy a site in a residential park and to install or locate a dwelling on that site for residential purposes.
Section 5 of the Act says the Act will not apply to an agreement in respect of a dwelling in a residential park unless the dwelling is or is to be the person’s principal place of residence. That is, the Act does not necessarily or at all apply to transient itinerant residents or, “annuals” as they are described within the management agreement. Aspects of proof of permanency of occupations are also covered within the subsections of s5. The existence of and requirements for park rules and Residents Committees are prescribed in s6 and s7 including amendment of those rules under s8. The prescription for the formation of residential park agreements is set out in Part 3 of the Act from s10 onwards and in particular that the agreements must be in writing, they must contain terms prescribed by the Act and the Regulations under the Act and copies must be provided. Immediately following the prescription in relation to residential park agreements.
Under s49 of the Act, where a new registered proprietor becomes the owner of the Residential Park and upon the land acquired exists dwellings under residential park site agreements, then the new owner’s title to the land is subject to the residents’ interest under the residential park site agreement. The only right in the new registered proprietor is then to give a notice of termination of the residential park site agreement to the resident. The notice of termination must specify the end date of the tenancy agreement being the date of the end of the agreement or 12 months from the date of the new owner’s acquisition of title to the land. Subsection 49(5) of the Act provides that where there is a permanently fixed dwelling located on the site, under a residential park site agreement, then the notice of termination under the Section must not specify a day on which the agreement is terminated that is earlier than the end of the term of the agreement fixed by the agreement.
Section 50 of the Act recognises that there will sale and purchase agreements for dwellings on site. The section recognises the freedom of the market for the sale and purchase of dwellings. It also prohibits the park owner hindering or attempting to hinder the sale of a dwelling in that market.
In the course of argument, Counsel put a number of submissions to me about the meaning and operations of a number of the sections of the Act. In my view, there is merit in the arguments of both Counsel. At this stage of the proceedings it is not appropriate that I attempt to address these arguments. The resolution of those competing arguments appears to be an essential requirement in the final judicial determination of this matter.
The application of legal principles to the facts
In their first outline of argument, the plaintiffs summarised the legal principle in support of their contention in the following way:-
SUMMARY OF LEGAL PRINCIPLES
74. In summary, the following important principles emerge from the cases referred to above: first that an occupant or possessor of land can establish an equity in relation to land in circumstances where that person with the knowledge or encouragement of another person (a landlord) expends money on the strength of the representations made by the latter in relation to the use, occupation or possession of the land; secondly, that such an equity will bind both the landlord and any successors entitled to the landlord, notwithstanding that there may be subsequent changes in legislation affecting the use or occupation or possession; and thirdly, that such equity will be protected by the Courts by the grant of an irrevocable licence or another appropriately fashioned remedy to protect that equity.
The Council did not strenuously disagree with this formulation but strongly disagreed on the factual basis of the case. Mr Wells QC submitted that, at the interlocutory stage, it is not actually necessary to formulate in any specific way the particular interest said to be enjoyed by the plaintiffs or alternatively the interests which arises by virtue of the conduct of the Council. He said that the plaintiffs were entitled to stay in the Caravan Park for a period of greater than 12 months because they enjoy a right protected by equity to stay on the Caravan Park site until they choose to terminate the arrangements or alternatively, if the Council was in a position to terminate only because of irremediable or un-remedied breach of the site agreements.
Mr Wells QC contended that the interest enjoyed by each of the plaintiffs was not an interest limited to a 12 month agreement. He disclaimed any suggestion that at the very best, the plaintiffs might enjoy an interest only for a period of 12 months so that the rights of the Council under, for example, the Residential Parks Act, would be postponed to that interest. Mr Wells QC did not identify an upper temporal limit of the interest because, as he said, that was not necessary in the context of an interlocutory application. It will be a matter for the trial Court to make a decision on what is the consequence as between the plaintiffs and the Council of the estoppel which the plaintiffs claim. Mr Wells QC agreed that the equitable interest was something in the nature of a leasehold interest but the terms of the leasehold interest would have to be fashioned according to law including the statutory requirements. All that is necessary for the Court to do is to be satisfied that the equity is capable of not only arising but been given effect to.
On the question of the Council’s knowledge, Mr Wells QC referred to Exhibit MP6 to the affidavit of Marilyn Pearson sworn 20 November 2013 (FDN34) (the Pearson affidavit). This is a report to the Council dated 13 September 2011 on the subject of the Brighton Caravan Park Manager’s Annual Report, written by Mr Watson, Corporate Risk and Property Officer. It recommends the tabling of the report and secondly a review of the Caravan Park business model and facility is about to be undertaken and will be reported to Council at a later time. He states in the fourth bullet point:-
Permanent residents – the terminology within the existing agreement is ambiguous in referring to this category of resident. It would appear that the use of the term “permanent” has led some residents to reach a view that they possess some degree of ownership or value in the sites upon which their cabins/vans/annexes sit, which in turn has led them to seek prices (sometimes considerably) in excess of the value of that infrastructure from potential purchasers. Under the terms of their agreements this class of resident effectively has a right to occupy a nominated site for rolling 12 month periods (provided they comply with the obligations within the agreement). It also recognises that this category of longer term resident provides a considerable (approximately 20% of the current income) and stable revenue stream to the Park (and Council).
The “existing agreement” refers to the management agreement with Ricklemore. Mr Wells QC argued that there is a clear discrimen between the first and second sentences of the bullet point and what follows in the bullet point. The second sentence discloses the understanding of Mr Watson concerning the consequence of the use of the term “permanent” and the belief of residents that they possess some degree of ownership or value in the sites upon which their caravans sit. This has led them to seek prices in excess of the value of that infrastructure from potential purchasers.
Mr Wells QC submitted that the concept of a “permanent resident” has, at least since 2003, been a term that has been commonly used in and about the operation of the Caravan Park. The first sentence in paragraph 13.2 of Schedule 3 of the management agreement carries with it the hallmarks of permanency of residence because those persons living on those site would nominate the Caravan Park as their main place of residence. They are therefore not “annuals” and they are not daily or weekly renters.
Mr Wells QC submitted that the second sentence in the note prepared by Mr Watson discloses that the Council is aware that forms of expressions such as “permanent resident” have led some of them to believe that they possess some proprietary interest or proprietary value in a site which in turn has led them to seek (and obviously to obtain) prices for the site well in excess of the value of the infrastructure on the site. This position is to be distinguished from the last two sentences of the bullet point wherein Mr Watson identified the position of the residents. And, the comment by Mr Watson is to be seen in its totality. He is informing the Council that as a result of the use of a particular adjective, residents have formed the view that they have some “proprietary” interest to sell and have demanded a payment accordingly.

In his submissions, Mr Wells QC described this evidence as “classic” evidence of knowledge on part of the Council that a premium is being paid for tenure. It was described continuously as the “Watson assumption”: that there was knowledge on the part of the Council that in consideration of permanency of tenure, premiums were being paid for the caravans and annexes on the site which was well in excess of the value of those items. Obviously enough the Council had knowledge of this situation as described by Mr Watson. There is no evidence about for how long the Council possessed this knowledge. Mr Wells QC put his submission on the basis that this identifies knowledge on the part of the Council of how residents see their own “permanency”. This in turn has created the market in the permanent dwelling and obviously the premiums being paid for the particular dwellings.
Mr Wells QC then suggested that, by using the expression “…this class of resident effectively has a right to occupy a nominated site for rolling 12 month periods…” identifies that there is a mutual understanding between the Council and the plaintiffs that all of the tenancy agreements under which the residents occupy a relevant site are on a continuous “roll” for 12 months periods. Mr Wells QC submitted that this identified both the knowledge of the fact namely the belief on the part of the residents leading to the inflated aftermarket as well as the mutual understanding between the Council and the residents concerning the “rolling” nature of the 12 month period tenancies.
Mr Harris QC submitted that no mutual understanding could be drawn from the use of the expression “rolling 12 month periods” as set out in the particular bullet point. Mr Watson identified immediate issues. It may be said that all 12 month tenancies which are renewed continuously, are “rolling” 12 month tenancies because of that very fact. It does not suggest that, by virtue of the use of that expression, it means that there is a mutual understanding between landlord and tenant or between operator and tenant concerning any right in the tenant to demand continuing ongoing leases of 12 month periods merely because they have been renewed on that basis for a period of time. That much is clear from the decision of Waddell CJ in Eq. in the Bond Brewing case. More is required before it may be said that there is any form of mutuality of understanding concerning those matters.
What appears clear from the wording of the paragraph is that the Council knew or understood that there was a misapprehension on the part of the residents that they possessed some degree of right occupation by virtue of the fact that the sites were called permanent sites and that has led to the (over-inflated) aftermarket concerning the sale and purchase of those sites.
Mr Harris QC also pointed out that five of the permanent residents signed acknowledgement documents that were, in terms inconsistent with this stated belief. And all of the residents were subject to the Park Rules that were similarly inconsistent with the belief. The primary submission of the plaintiffs was that rather than better informing the plaintiffs, what was done by the Council merely reaffirmed the Council’s belief.
I have already identified those persons who, upon making enquiries in relation to the execution of the site agreements, were informed that the execution of those agreements was a mere formality. Mr Wells QC submitted that this circumstance is similar to the statements made by Mr Murphy in the Bond Brewing case that the execution of the goodwill letter was merely a formality. Mr Harris QC submitted that different from the Bond Brewing case, the plaintiffs were not told that notwithstanding the content of the tenancy agreements, the manager would not purport to exercise rights under the tenancy agreement in accordance with its terms. Although such statements were not made, the plaintiffs point to the fact that following being informed that the documents were a mere formality, those incoming “permanent residents” were also told that once they were in possession they could expect a permanent occupancy subject only to questions of observance of rules. Therefore, as the submission went, although there is a factual difference, there is no material difference on those facts (without more) from the factual circumstances as presented themselves to Waddell CJ in Eq. in the Bond Brewing case.
Mr Harris QC submitted there is distinction to be made in these circumstances. The statements made to the new “permanent residents” were all made by Ricklemore through its authorised servants, the Birchmores, (the O’Reilleys and the Neeskens) and, under the terms of the management agreement, Ricklemore was an independent contractor standing at arm’s length to the Council. He further submitted that there is no evidence to suggest that the Council authorised Ricklemore or its servant or agents, to make such representations to the plaintiffs. The question for consideration is whether or not such representations bound the Council.
I am unable on this interlocutory hearing to asses and decide upon the submission of Mr Wells QC that it is inevitable that both Ricklemore and the Council would have been told about sales as they both required newcomers to consult with them before buying. Mr Harris QC submitted that there is no evidence at all that any newcomer to the site did or was required to consult with the Council. There is evidence that there was consultation with the Council and that on an occasion, a Council employee was informed of the price being paid for a particular site (Mr Buckerfield). The Council employee, who had no particular status or authority, reacted to that news by saying that the price paid was “ridiculous” and that he was then told that higher prices were being paid for other sites. The suggestion of higher prices being paid for other sites is plainly a justification for the amount being paid for the particular site under discussion. However all of these issues are matters that I am not required to resolve finally in this hearing. I am unable to resolve these issue on the basis of evidence before me and I should not embark upon that task in this hearing.
In this connection, Mr Wells QC also relied upon a letter from the Mayor of the Council, Mr Ken Rollond to Mr Justin Lynch the Chief Executive Officer of the Council. It is exhibit NX22 to the affidavit of Nicholas Xenophon sworn 26 November 2013. The letter discloses that Mr Rollond as Mayor was absent and not part of the debates concerning two issues that he saw as important, one involving the Caravan Park. In his letter, Mayor Rollond suggests that he disagrees with Council’s decision. He says that he thinks the Council could be liable for huge compensation payments to the so-called “permanent residents”. He justifies that by saying that many years ago (more than six) he was informed that residents of the Caravan Park were advertising plots for sale including infrastructure on those sites in various media outlets. He claims that the Council, by not acting to stop the practice, could be found guilty by omission.
Mr Wells QC’s point on this issue was that this is further evidence of the knowledge of Council. He referred in particular to the material included by Mayor Rollond in the first page of the letter under the introduction: “My third reason…” and says that he has seen no evidence that written notice was given to the residents at the time and that the Council is relying entirely on the yearly tenancy agreement. The Rollond letter is some further evidence of the knowledge of the Council about what was occurring at the Caravan Park. It perhaps would have been quite helpful to have an understanding of what other information was possessed by Council or Mayor Rollond at the alleged time (6 years ago).
Mr Wells QC then discussed briefly each of the residents. He referred to the affidavit filed by Mr Douglass Anthony Boss sworn 7 November 2013. Paragraph 3 of that affidavit discloses that it was necessary to meet with Mr Birchmore to ascertain suitability before a caravan site could be purchased. He then states that the owner of the “caravan” told him that residents who lived in that section of the Caravan Park could stay there permanently. Mr Wells QC stressed the significance of this and other like statements by resident plaintiffs as being a community of understanding and interest. It appears clear from the evidence that the residents thought that they were living onsite as permanent residents. Mr Boss deposes to a conversation with Mr Birchmore in about February or March of 2006. He says that he obtained an understanding from that conversation that once he passed the relevant check for clearance he could stay permanently as a resident as long as he paid rent and looked after the site.
Mr Boss also says in November 2009 he received a document from Mr Birchmore which is exhibit DB1 to his affidavit. He then says that he understood that the form given to him by Birchmore was only a mere formality given what he had been told three years earlier. Mr Boss had taken up his tenancy many years earlier: its content and its delivery must therefore be viewed in the background of those circumstances. Exhibit DB1 is a written form of an acknowledgement. It says that Mr Boss acknowledges that prior to accepting occupancy at the Brighton Caravan Park and Holiday Village he was aware of a number of conditions. Five conditions are then set out. They are:-
1. Brighton Caravan Park and Holiday Village, Ricklemore Park Management and its Directors have no involvement in the sale or purchase of the caravan;
2. The sale is solely for the caravan and fittings and the land on which they are situated always remains the property of Brighton Caravan Park and Holiday Village;
3. A residential site agreement is to be signed not less than six weeks of occupation;
4. All site agreements are for a maximum of 12 months and expire on 30^th day of June annually and are subject to review;
5. No extension or renewal of any residential agreement is guaranteed;
6. The occupants agree to abide by all Park Regulations as outlined in the prospectus.
A submission put by Mr Wells QC is that the expression “…expire on 30^th day of June annually and are subject to review…” can only mean expiring every year on 30 June and not just expiring once. Also, the fact that paragraph 5 and paragraph 6 are in juxtaposition means that this is merely a confirmation of what was expected by the residents.
The acknowledgment signed by Mr Boss in 2009 appears to have occurred some several years after when he signed his first site agreement called a residential site agreement. Those agreements did not come into existence until after the commencement of the operation of the Act. Mr Harris QC submitted that the meaning of the document is clear enough. It is a signed acknowledgment by the person, Mr Boss, of a number of important factors. The most important is that the site agreements are for a maximum of 12 months. They expire every year on 30 June. They are subject to review. Merely because the expression “annually” is used would not usually lead to any particular conclusion about the rolling nature of any particular site agreement. Any ordinary reading of that clause together with clause 5 would suggest to even the most unsophisticated person that the agreements are for 12 months duration and there is no guaranteed extension of them.
In the absence of any cross examination on the topic it is not possible to resolve this situation. That can only be resolved at trial because of the general evidence of the plaintiffs of the statements by Ricklemore about the question of documents only being a formality. That in turn is dependent on the position of Ricklemore vis a vis the Council.
The case of the Council is that each of the plaintiffs received, signed and returned the documents in the form of the six exhibits to the affidavit of Mr Boss of 7 November 2013 (FDN6). That matter is also in contention between the parties.
Mr Wells QC next referred to the affidavits deposed to by Mr Campain (FDN 9 and FDN 29). Mr Campain has only been a resident at the Caravan Park since September 2012 and he paid $65,000 for the dwelling. He understood from his conversations with the previous owners that he would be purchasing the dwelling as a permanent resident. He then deposes to a conversation with the Neeskens and he was informed that he was buying in as a permanent resident. All that was necessary was to pay the rent. Mr Campain said that he was paying the $65,000. He also says that when he signed his tenancy agreement in about September 2012, he did so on an understanding that the agreement would be renewed each lease and it was just a formality. This understanding was formed by his discussions with the Neeskens. It was also his understanding of what was happening with other residents.
Mr Campain also says in his second affidavit that in about September 2012 the Neeskens presented him with a number of documents and they were forms in regards to being accepted as a resident at the Park. They needed to be signed. At the time that he signed the relevant documents, he was given signed and dated (28 August 2012) a document entitled “purchasing a caravan to live on site permanently”. There is set out a series of dot points. The second informs the purchaser that the purchase relates solely to the caravan and does not include any land or infrastructure whatsoever. It also stipulates that there is a six week probationary period before a tenancy agreement must be signed. It then says that each agreement is for a maximum of 12 months term and all agreements expire on the 30^th day of June annually. The next bullet point says that any extension of a residential contract remains solely at the discretion of park management and to no guarantee of an extension is given. The same dot point also states that compliance with regulations, site maintenance and caravan appearance play an important factor in the issuing of any new agreement.
Mr Wells QC criticised the wording of the document. He said that the document is significant for what it does not say. For example, he contends that it should have said that any person does not have an automatic right to stay at the Caravan Park and should only be read to mean that the occupier does not have an automatic right to that particular site on which to put the dwelling. Mr Harris QC contended that the third bullet point refers to that very topic and says that there are no automatic rights to continue occupancy of the site on which a caravan is located. It is to be understood as meaning that a person might be required to move the caravan and fittings to another site. The later dot points relate to the term. It is defined to mean a 12 month term only and that all agreements expire annually on 30 June and extensions remain at the discretion of Park management. An ordinary reading by any unsophisticated person would identify that the tenants are being informed of matters of which they must be aware, including in relation to their tenure at the Caravan Park.
However and for the same reasons that I expressed in relation to Mr Boss, the delivery of the documents appears to have been accompanied by statements to the effect that, as long as rent was paid and the premises kept then he was a permanent resident. This understanding is in contrast to the content of the document DC1 to Mr Campain’s second affidavit (FDN29).
Mr Wells QC then referred to the affidavit of Mr Austin (an exhibit to Mr Xenophon’s first affidavit (FDN2)). Mr Austin took up residence at the site in 2010. He informs the Court that in 2009 he was aware that the Council issued a directive given to impose a moratorium on building and development of annexes at the Caravan Park. It was enforced by Ricklemore. He says that in or about April 2010 he was informed by Ricklemore that he was entitled to live at the Caravan Park as a permanent resident. At that time he knew that other people had been living at the Caravan Park for many years as permanent residents. He also received a document from Mr Birchmore (exhibit JA1 to his affidavit). That document is entitled “Caravan Park Regulations (permanent residents)”, the Regulations contemplated under the terms of the Act. It deals with residency at paragraph 3 and states that all residential contracts are for a maximum of 12 months and expire on 30 June annually.
Mr Austin says that on 29 April 2010 he had an interview with Mr Birchmore concerning his wish to come and live at the Caravan Park. He was told by Mr Birchmore that he would be entitled to live at the Caravan Park as a permanent resident. Submissions were put about the significance of the expression “permanent resident”. Mr Austin says that after that time he held the belief that he would be entitled to live at the Caravan Park permanently once he moved onto the Caravan Park. This was because at his “entry” interview, he was told by Mr Birchmore that he would be entitled to live as a permanent resident.
Following the conversation with Mr Birchmore, a site was purchased by Mr Austin for $81,000. Finance was procured from a large commercial bank. There were prerequisites for becoming a resident including an interview and approval. It is known that there was also a probationary period.
On 22 May 2010, some one month or so after entering his agreement to purchase the van on site, Mr Austin signed an agreement. The form of the agreement is “Residential Park Site Agreement”.[35] Mr Austin says at the time of signing the agreement, nothing was said to him to suggest that he would not have a right to live at the Caravan Park permanently.
[35] Viz s72 Residential Parks Act 2007.
The first page of the agreement states that it is a Residential Park Site Agreement and that it is for a fixed term. The fixed term is described from 1 July 2010 to 30 June 2011. The agreement recites that the Park Owner agrees to let to the resident who agrees to rent the rented property, being site B017, during that period. There follows from the front page a series of conditions. Clause 10 identifies Park rules that may be made by the Park Owner about the use, enjoyment, control and management of the Caravan Park and states that the rules will be taken to constitute terms of the agreement. Copies of Park rules are to be provided. The right to sell the dwelling is contained within Clause 16 and rights of termination are then set out in Clauses 17, 18, 19, 20 and 21. The holding over provision is set out in Clause 22. The pertinent clause is Clause 21. It is to be recalled that the term under the description “fixed term” was for a period from 1 July 2010 to 30 June 2011. Clause 21 of the agreement reads:-
21. Termination at end of term
Either the Park Owner or the resident may terminate this agreement at the end of the term without specifying a ground of termination by giving the other not less than 28 days clear written notice.[36]
[36] Viz s72 Residential Parks Act 2007.
Within the terms of the agreement there is only one description of the term and that is on the front page as I have already described. Mr Austin says that he is not a sophisticated man of commerce. However, he says that he has limited experience in negotiating contracts confined to employment contracts and real property sale contracts. Mr Harris QC submitted that it may be assumed that Mr Austin is able to read and write and that that he had the capacity to read paragraph 21 if he took the time to do so. If he had done so, he would have understood the plain English meaning of the clause that the Park Owner is able to terminate the agreement on 28 days notice at the end of the term being the period ending on 30 June 2011.
Mr Austin says that at no time prior to signing the tenancy agreement was he told that the tenancy agreement might not be renewed. He was told that the Park Owner could terminate the agreement at the end of the term without specifying a ground. It is difficult to see those two propositions sitting together. The tenancy agreements were renewed for 2011 and 2012. It appears that they were signed by Mr Austin and his wife, Ms Caddy. They paid sufficient attention to the content of the document to enable them to make small corrections about the amount of rent charges and the name of Ms Caddy. On both occasions the representatives of Ricklemore engaged with Mr Austin and Ms Caddy in and about the execution of the document and on those occasions the representatives of Ricklemore observed Mr Austin and Ms Caddy signing the agreement. Therefore, the same comments as I have made in relation to the 2010 agreement obtain.

The first item in the minutes relates to Clause 14 which concerns change of ownership of vans on site including conditions that may apply when the age of the caravan being sold exceeds 20 years. There is a record of a complaint by residents about the restrictive nature of the clause. There is a second reference to the concern of management about dwellings being sold at inflated prices because of the location. The next sentence records:-
The executive feel that provided prospective purchasers are made aware of Park Rules, it is not their role to be involved.
The balance of the minutes then go on to discuss the questions of occupational health and safety, park safety and standards within the Park.
Mr Wells QC submitted that, properly understood, the minutes appear to cover a number of matters. All are related to the transferability of dwellings within the Caravan Park. On one reading of the minute as whole, it does not gainsay the propositions made by the plaintiffs, as the issue being discussed may relate to an entirely different matter. It is neither consistent nor inconsistent with the case of the plaintiffs because it does not inform the case one way or the other. The opposite position may also be argued. In the absence of evidence I am unable to resolve these arguments.
Mr Harris QC also referred to[73] minutes of the Brighton Caravan Park Permanent Residents Committee. It was attended by a large number of the plaintiffs in this action. The minutes of 15 March 2011 appear to record matters involved with the standard of dwellings on site as well as the Caravan Park generally.
[73] The second exhibit (PEA38) to the affidavit of Ms Aukett of 19 November 2013.
There is then a reference to minutes on 14 June 2011, paragraph 2.3 of which reads as follows:-
2.3 Lease renewals – most leases have been renewed for a further 12 months. Leases are offered for 12 months and management is under no obligation to renew leases each year. Residents concerns…
2.3.1 upgrade of the Park Rick (Birchmore) said the Council Committee dealing with the upgrade of the Park (of which he is a member) has not met in the last 12 months. His gut feeling is that no changes will take place within 3 years. (Rick stresses that it is only his gut feeling and he doesn’t have anything else to base that on).
(My emphasis)
The submission of Mr Harris QC was that, if the case as put by the plaintiffs was the view held by the parties as at 14 June 2011, why would it be the case that this minute was recorded. How could it be said that the plaintiffs were “all on the same page” in light of the existence of this minute?
Mr Wells QC submitted that there is a danger in reading a minute and extrapolating all manner of meaning from it without having heard from, Mr Birchmore, Mrs Pearson or anybody else who was involved. Second, on one argument, there is nothing inconsistent in Clause 2.3 concerning lease renewals because the interest contended for by the plaintiffs recognises that management was under no obligation to renew leases each year in the event that the residents were not complying with the Rules of the Park. As well, the minute appears incomplete because the last phrase within the minutes reads “Residents’ concerns…” It is unclear what was being referred to in the minute about residents’ concerns. However, there is some (albeit small) hint about issues because Mr Birchmore was explaining in paragraph 3.2 of the minutes that changes were implemented to ensure purchasers did not assume that they had a right to lifetime tenancy. That in turn, depended upon what had been said prior to 15 March 2011 from which paragraph 3.2 of the minutes of that meeting is taken. It also does not inform what might have been said prior to that time.
The last sentence of the first paragraph is also informative. It says:-
The changes also identify unacceptable behaviour and that park management is under no obligation to renew or extend a lease if the owner has broken the regulations.
There is then a further discussion about the need to keep sites to an acceptable standard. Mr Wells QC submitted that the minute as a whole does not necessarily “carry the day” in accordance with the submissions made by him. A number of matters that were in contention and under discussion as between the parties. As one example, there is a reference to “…a right to lifetime tenancy…” that comes from Mr Birchmore. Albeit rhetorical, the question that arises is why would Mr Birchmore raise questions of rights to lifetime tenancy in light of the documentation that had been used since at least 2007 to identify tenancy arrangements between residents and the operator. This is not a matter that I am able to resolve on an interlocutory hearing on the state of the evidence.
Mr Harris QC then focussed upon the question of the “encouragement” of the Council and identified the three matters that had been addressed by Mr Wells QC. They are the “Rollond letter”,[74] the knowledge of the Council about the inflated prices being paid for the permanent sites at the Caravan Park and thirdly the “Watson acknowledgment”. Mr Harris QC submitted that in none of these matters is there any indication of encouragement by the Council. In their supplementary submission and after making the initial submissions in relation to the question of the knowledge and encouragement of the Council, Mr Wells QC submitted that the Council was bound by the estoppel because of its own conduct and the conduct of those who were both its representatives and its privies who in turn contributed to the creation and persistence of the assumption.
[74] Exhibit NX22 to the affidavit of Nicholas Xenophon sworn 26 November 2013 (FDN33).
The matters identified by Mr Wells QC were as follows. First, with the knowledge of the assumption, the Council failed to correct the assumption. The plaintiffs refer to the “Rollond letter” and the “Watson acknowledgement”. The “Watson acknowledgment” identifies a correlation between the use of the term “permanent” and residents reaching a view that they possessed some degree of ownership or value in the site upon which their cabin/van/annexes sit. That has in turn led to the increase in prices sought for the purchase of those vans. And, this is a reference to a statement within a report. It may not reflect the discussion that might have taken place in and about the report. Taken at face value, it shows that there is knowledge within the Council of a belief on the part of the various residents concerning their right of tenure and their ownership of some interest over and above the ownership of the dwelling on the site. That is, there is something over and above the dwelling itself which gives rise to a monetary value. It is completely unclear how Mr Watson may have come to this conclusion, whether the conclusion is correct and whether he is fully aware of how that conclusion may have been formed. That is the importance, from the plaintiffs’ point of view, of the assumption and the knowledge within the assumption.
It was submitted by Mr Wells QC that two things follow. The first is that it may be assumed that it would be immediately identified that something must be done to correct the assumption. It is to be expected that whatever is done, it must be in an active sense not in a passive sense because of the importance of the matters raised by Mr Watson within his report as set out above. The second is that some judgment must be exercised about the way in which such active intervention is to take place. A criticism by the plaintiffs of the actions of the Council is that it did not actively take steps to correct the assumption but rather acquiesced in the plaintiffs’ continued detrimental reliance on the assumption. For example, it is a matter of conjecture about what might have happened in the event that each of the plaintiffs were approached and told personally about the inaccuracy of whatever assumption might have been made by them. Such intervention should have been followed up with documents but those documents also should have reflected an active intervention by the Council. There is no evidence of these matters. Therefore, the question of encouragement or not as submitted by Mr Harris QC is not a matter that can be assessed “in a vacuum”. It is a matter that must be assessed in light of the whole of the background circumstances of the case. And I am not in a position now to express any particular view on the matter.
The second matter raised by Mr Wells QC was an assertion that with the knowledge of the assumption, the Council encouraged the secondary market in the dwellings. It was in that market that a premium was included for tenure. There is evidence that the Council knew that because residents may have misapprehended their position (from the Council’s point of view) this meant that the aftermarket in the sale and purchase of the dwellings was at a level of price well in excess of the value of the infrastructure. It may be assumed that the infrastructure was largely worthless and that almost the whole of the price paid for the site was in respect of an asset/value other than the actual infrastructure itself. The continuation of that market in the knowledge of the Council is the issue on the submission of Mr Wells QC and not whether the Council has actually encouraged that market. It could not be said that the Council has actively encouraged anything at all but that it may be said that the Council did nothing in light of its knowledge of the existence of that aftermarket and that knowledge is not in doubt.
The third matter is the question of the Council being privy by statute or otherwise to the representations and the failures by Ricklemore to correct the assumption. I have already addressed that matter. The plaintiffs’ position is that it appears certain that Ricklemore knows of the aftermarket in the dwellings, of the requirement for security of tenure with permanency, of the enquiries about those matters raised by the prospective tenants, of the assurances given and of the steps then taken by the purchasers of the dwellings.
The Local Government Act (LGA)
Section 200 LGA sets out a general prohibition against the use of community land for a business purpose unless the uses are proved by Council. The operation of the Caravan Park on community land is for a business purpose. Sub-s200(2) LGA prevents the use of community land for a business purpose unless it is under the provisions of a management plan. The question of the content of the management plan for the Council is addressed in the second and third affidavits of Ms Aukett filed on behalf of the Council. Section 202 LGA deals with alienation of a community land by lease or licence. Under sub-s202(2) LGA, before a Council may grant a licence in respect of community land it must follow the relevant steps set out in its public consultation policy. The only exception would be under sub-s202(3) in the event that it is not necessary to comply with the requirements of sub-s2 if the grant of licence is authorised in an approved management plan or the Regulations provide for an exemption. The affidavits of Ms Aukett disclose that there is no authority in any approved management plan for the grant of a licence in relation to this community land and the Regulations do not provide an exemption. The public consultation policy of the Council is to be found in exhibit PEA39 to the third affidavit of Ms Aukett and reference is made to subclause 2.1.6 and subclause 2.1.7. Those subclauses require public consultation and notification to the public of an intention to grant an interest in community land so that the public can make submissions about that proposal. The procedure also requires compliance with the Local Government Associates Community Engagement Handbook which is described in exhibit 41 to the third affidavit of Ms Aukett. That document sets out a five phase process in which there are between two and seven steps. None of those things have been done in relation to the Caravan Park land.
Mr Harris QC relied upon the decision of Street J in Pratten v Warringah Shire Council.[75] This case concerned land at Palm Beach, Sydney which automatically vested in the local Council in September 1920. That automatic vesting did not authorise the Registrar General to enter the Council as the registered proprietor of the land because there was no provision within the Real Property Act for such registration. In the absence of any legislative sanction authorising the removal of the name of the previous registered proprietor, the interest of the Council was not registered. Section 398 of the LGA New South Wales operated on the land to divest the ownership from the registered proprietor and to vest that ownership in the Council in fee simple for drainage purposes. The Council became an owner for all purposes as if it owned an estate in fee simple in possession in the land. The 1921 amendment to the Real Property Act (New South Wales) remedied the position and permitted the name of the Council to be entered on the Register. The Council did not seek to have its name registered.
[75] (1969) 90 WM 134.
In 1967, Mr Pratten’s solicitors made enquiries of the Council concerning the land, identified that drainage reserve and identified the fact that it had been “dedicated to the Council”. The reply of the Council to the solicitors was that the Council had not become a registered proprietor and that it had no interest in the land for drainage purposes. The Council indicated that the ownership of the land remained vested in the previous owner, Palm Beach Lands Pty Ltd. The plaintiff entered into a contract to purchase that land and the plaintiff became registered as a proprietor of the land, including the land dedicated to the Council for drainage purposes.
After a query by the Registrar General, the plaintiff’s solicitors again contacted the Council, identified the issue in relation to the operation of s328 of the Local Government Act (NSW) and asked whether the Council would be prepared to transfer the land to the plaintiff. The Council again replied that it had no interest in the easement land. Upon that reply, the plaintiff became the registered proprietor of the land, presumably because the queries raised by the Registrar General had been answered.
Street J decided[76] that Palm Beach Lands Pty Ltd, the former registered proprietor of the whole of the land, did not have any fee simple interest in the drainage reserve land dedicated to the Council and could not transfer an interest in that land. The only way that the Registrar General could register a transfer of that interest of the Council in the land was under a written request of the Council pursuant to s14 of the Real Property Act (NSW). No such request was made.
[76] Page 142.
The alternative argument put on behalf of Mr Pratten was that the Council was estopped by its actions through its correspondence from asserting against the plaintiff’s title to the land. Street J, reluctantly, found that the plaintiff failed on this argument. This was, principally, because the Council’s powers to deal with the land were restricted by the terms of the LGA (NSW). It would only be if the Council obtained the approval of the Governor, that it would be in any position to sell the land and to transfer it to an arm’s length purchaser free from any encumbrance. The fact that the Governor’s approval had not been obtained was fatal to the argument. Street J held[77] as follows:-
The Governor’s approval is no less necessary in a case where it is sought to propound an estoppel against the Council than it is in a case where it is sought to allege that the Council has expressly by deed purported to deal with a drainage reserve. The approval of the Governor is a statutory prerequisite to any dealing by the Council. To give effect to the estoppel… would allow that estoppel to override the statutory requirement of the Governor’s approval.
[77] At page 143.
His Honour then considered Spencer Bower and Turner on Estoppel by Representation at page 32 and agreed with the learned authors that:-
A contract ultra vires a statute (for example) cannot be validated by an application of an estoppel… nor can the lack of such essential formalities as the consent of a Minister of the Crown or the making of a contract under seal or other particular formalities prescribed by statute be remedied by estoppel when the statute has made them the necessary conditions of entering into the transaction.
It was on that basis that Street J rejected the alternative argument.
In response Mr Wells QC referred to the decision of the Court of Appeal of New South Wales in Silovi Pty Ltd v Barbaro.[78] This case concerns an agreement made in 1982 by the registered proprietors of land with the proprietors of an adjoining plant nursery. The agreement gave a lease of portion of the allotment of the owner’s land to the nurseryman. The nurseryman then came onto the land the subject of the lease and planted 10,000 Cocos palms valued at about $90,500. These palms take about 10 years to reach maturity, the length of the lease entered into between the owners and the proprietors. The owner of the property on the other side of the registered proprietors became aware of the arrangements made between the owners, Barbaro, and the lessee of the portion of the allotment.
[78] (1988) 13 NSWLR 466.
Section 327AA of the Local Government Act (NSW) prevented registration of a lease of portion of an allotment for a period of lease over 5 years.
The proprietors of the plant nursery lodged a caveat to protect their interest upon failure to register their lease and the proprietors, Barbaro, assured them that the lease would not be broken.
Two years later, the owners entered into a contract for the sale and purchase of the land with the owner of the allotment on the other side of Barbaro’s land. Powell J, at first instance, gave a relief to the proprietor of the nursery against the purchaser of the Barbaro land, Silovi Pty Ltd (Silovi). The decision of the Court of Appeal of New South Wales was given by Priestley JA. At page 472 his Honour identified that the case was properly described as one of equitable estoppel. There had been unconscionable conduct on the part of the owners in entering into a contract with Silovi which, if carried through, enabled Silovi to defeat the assumption encouraged by the owners and the plaintiff that they had a right to use and occupy the land until 1992 (the end of the 10 year lease). This was despite the fact that Barbaro, in the contract with Silovi, attempted to preserve the plaintiff’s right. This was insufficient to “save” Barbaro because the contract entered into with Silovi, which was the unconscionable conduct, would permit Silovi, upon registration, as proprietor to exclude the plaintiffs from the land.
Silovi primarily relied upon the provisions of s327 and s327AA of the Local Government Act (NSW). Under s327, land was not permitted to be subdivided unless a plan of subdivision was registered. For those purposes, subdivision included dividing land into parts including by an agreement for lease for a period not exceeding 5 years without option of renewal. In the event that the lease was for a period of 5 years, then the land was available for separate occupation. Under s327(3), the agreements were not rendered void but merely made subject to a condition precedent, that they should be made subject to the approval of the Council being obtained. Section 327AA did not contain such a saving provision and the Court rejected the argument that it must follow, in the absence of the saving provision, that any contract entered into contrary to s327AA must be treated as void. Priestley JA held[79] as follows:-
There is no apparent reason when the sections are read in context, why noncompliance with s327AA should produce so much more drastic a result than s327 or why the case where there is noncompliance with both sections by the one agreement that agreement should be treated as subject to Council approval for the purposes of one section and illegal or void for the purposes of the other.
[79] At page 473.

His Honour went on to hold that such a term would be implied in any event.
It was on the basis of that finding that his Honour then went to consider whether or not equity would fashion a remedy in the particular circumstances. His Honour said[80]:-
Once that step is taken there seems to me no difficulty caused by the second question arising under the submission. If the equities in the case otherwise justify orders of the kind made by Powell J, there can be no objection based on s327 or s327AA to orders substantially permitting the satisfaction of the plaintiff’s equity, if those orders are so framed that there is no breach of the section.
(My emphasis)
[80] At page 474.
Thus it may be seen that the view of the Court was that as long as the contract itself was not rendered void by the statute or did not offend the statute to such an extent that it was unenforceable, then equity could fashion a remedy having regard to the existence of the statute. The Court envisaged that any number of contractual arrangements could be made to enable people to come onto the land and operate on the land and retain the “profit à prendre” rights as existed in the arrangements between Barbaro and the nurseryman. Having made those findings, Priestley JA then held[81] as follows:-
Powell J’s orders in the present case do not in my opinion permit a situation in breach of s327 as Silovi argued. The effect of the orders is not to render the relevant parts of the land immediately available for separate occupation (which because of the definition of “subdivision” already referred to might well be contrary to the section) but to ensure to the plaintiffs access to the land and their cocos palms which does not preclude the owners from occupation of the land and is not inconsistent with the usual idea of licences, that is, permitting the use of the land by licencees simultaneously with the continuing occupation of the owner.
[81] At page 474.
After making findings in relation to the awareness of Silovi to the arrangements made between Barbaro and the nurseryman and the legal difficulties faced by them, Priestley JA confirmed the estoppel upon Silovi from attempting to claim a superior equitable interest under its contract for the sale and purchase of the land to that belonging to the nurseryman. Priestley JA said[82] as follows:-
Treating the plaintiff’s equity arising from the equitable estoppel as that to which Powell J’s orders would give effect, it amounts to a personal licence to the plaintiffs coupled with an interest in the nature of a profit à prendre represented by the right of the plaintiffs in regard to the Cocos palms. This seems to me to be quite sufficient to justify treating the plaintiff’s rights against the owners as more than personal and is sufficient to prevent the later equitable interest acquired in the particular circumstances of the present case from prevailing over the earlier rights.
(My emphasis)
[82] At page 475.
Mr Wells QC finally submitted that the eviction of the plaintiff tenants in their peculiar circumstances amounted to or involved an acquisition of an interest in land under the Land Acquisition Act (SA). If that be the case, then the requirements of the Land Acquisition Act (SA) were not complied with. These included the requirement to give a notice of intention to acquire land pursuant to s10(1) of the Act. It also contemplates rights within the plaintiffs to be provided with an explanation about the proposed acquisition upon request (s11); to object to the proposed acquisition (s12) and the right of review by the Minister (s12A). These matters were not canvassed at length in oral submissions and Mr Wells QC included these matters in his supplementary outline of argument at pages 17-20. I have read those submissions and taken them into account. In my view, that is not a matter that could not be resolved on an interlocutory basis. It is an argument put and will be considered under the tests for an interlocutory injunction. Mr Wells QC responded further by submitting that the Local Government Act (SA) of South Australia does not contain a provision, similar in effect to s223LB(4) of the Real Property Act (SA) that the Council does not have the capacity to make the grant without first having undertaken the consultation.
Mr Wells QC also contended that, having regard to the fact that the Council was now the operator of the Caravan Park, it was bound by the estoppel created by its predecessor Ricklemore. That is for the reason that Ricklemore may be seen as the privy of the Council pursuant to the terms of the Act and the relationship created between Ricklemore and the Council under that Act. That is because each may be owner and manager by virtue of the definitions under the Act.
My task is to assess first whether there is a sufficient likelihood of success of the applicant’s application for relief at trial and second, whether the inconvenience or injury that the plaintiffs would be likely to suffer if an injunction is refused outweighs the injury that the Council would suffer if an injunction is granted. Third, it is necessary to address the question whether damages are an adequate remedy.
As I have attempted to make clear in the foregoing discussion, I have not made any findings about questions of fact. In many situations relevant to this case, it has been necessary to identify that a number of diverse arguments arise about particular facts, documents and circumstances that cannot and should not be resolved on an interlocutory basis. In the usual course, further material facts will be disclosed in evidence in any trial of this matter and therefore this discussion is confined to the facts as they are known to me currently. The decision that I make about the probabilities or likelihood of the success of the applicants to relief at trial having regard to the material proffered in support of the application does not require that I must make findings that matters are proved to any particular level of proof such as the balance of probabilities.
The questions to be taken into account in addressing the probabilities or likelihood of success are:-
First: whether there is sufficient evidence of an expectation by the plaintiffs about the property of the Council. In my opinion, sufficient has been shown in the material filed that it may be argued the statements of Ricklemore and by Mr Watson of the Council created in the minds of the plaintiffs a belief and therefore an expectation about their tenure upon the property of the Council, the Caravan Park.
Second: whether there is sufficient evidence of knowledge of the Council (itself or through its agents) of this expectation or belief. It may be argued the Council had knowledge of the assumption made by the plaintiffs by no later than 2011 (the Watson acknowledgement, the involvement of Ricklemore). There is sufficient evidence before me to suggest that it is possible that this knowledge existed for several years before 2011 (the Watson acknowledgment) (the Rollond letter). The question of the resolution finally of the attribution to the Council of the actions and knowledge of Ricklemore will turn on questions of fact that can only be resolved at trial.
Third: whether there is sufficient evidence of activity of the plaintiffs in reliance upon the expectation or belief. This can be positive in the sense of expenditure or by exception such as giving up a particular right that was otherwise exercisable. There seems little doubt on the facts that following the discussions with the Council (Mr Watson) and Ricklemore, the plaintiffs acted to their detriment by paying an amount for the dwellings that was significantly in excess of its real value and then expended funds on the dwelling in proving it over a period of time.
Fourth: whether there is sufficient evidence that the interest can be lawfully satisfied by the Council. The Council submitted that the LGA prohibited the alienation of any interest in the community land on which the Caravan Park sits and relied in particular on the decision of Street J in Pratten. There are a number of issues for resolution here that require full argument. For example: whether the alleged conduct of the Council actually in breach of the provisions of the LGA; whether equity is able to fashion a remedy to fit the requirement of the LGA and if so how. Despite the apparent strength of the arguments of Mr Harris QC based on the Pratten case, a Judge hearing the matter may, for reasons that may become clearer on the evidence, adopt the approach of Priestley JA in Silovi as discussed above. However, that is not a matter that can be decided here and neither should it be decided. It is a matter properly for trial.
Fifth: whether there is sufficient evidence of encouragement by the Council of the activities of the plaintiffs. There are alleged to be several forms of encouragement; the statements by Mr Watson about the longevity of the Caravan Park associated with the income it generates and that there will always be permanent residents. Then, arguably, the statements by Ricklemore about the “formalities” concerning the documents and of the permanency of the sites. The question of the resolution of the authority of Ricklemore and the binding nature of its statements are matters for the trial Judge. I again acknowledge the force of the submissions put to me by Mr Harris QC but at this interlocutory stage, it is inappropriate that I attempt to resolve those issues finally.
Sixth: whether there is sufficient evidence of knowledge in the Council of the property rights including the rights to take control of the land as a registered proprietor. This relates to the Caravan Park land in the knowledge of what was being done on the land by the plaintiffs. There is evidence that by no later than September 2011 (“Watson acknowledgment”) or earlier (the “Watson acknowledgment” (implicitly) and the “Rollond letter”) the Council were quite aware that the “permanent residents” were freely operating in an aftermarket of sales and purchase of the dwellings in contemplation of and on an understanding (based allegedly on nomenclature) of permanent residency.
In my view, enough has been shown that there is a sufficient likelihood of success of some of the plaintiffs as applicants for relief at trial to justify the grant of an interlocutory injunction in their favour until further Order.
I am unable to form that view in respect of the applicants Guy and Pearson because the material filed with the Court falls far short of that required. Notwithstanding, the failure of those plaintiffs in respect of this interlocutory application may have little effect overall.
In my view, the balance of hardship/balance of convenience favours the successful plaintiffs. The dwellings are their homes as their permanent residences. It is a very significant step for those plaintiffs to be forced from their homes and although relevant, I am unable to obtain much assistance from the fact that some owned other property or may be relocatable to other sites. This appears to overlook the very real and immediate consequences of these people being forced from these homes. The Council is a large organisation involved in many fields of endeavour. It will suffer detriment. The orders that I have under contemplation, including for an early trial, will not result in hardship to the Council sufficient to tip the balance of the exercise of the discretion in its favour.[83]
[83] Second affidavit of Nicholas Xenophon at paragraphs 21-22, 29-39.
For the same reasons, I am of the opinion that damages are currently an inadequate remedy in that the plaintiffs should not be confined to their remedy in damages.[84] If successful at trial, the plaintiffs may be confined to a remedy in damages but that is a decision for another day.
[84] STA v Apex Quarries Ltd [1988] VR 137 at 193.
I will hear the parties as to consequential Orders.