Hungry Jack's Pty Ltd v The Trust Company (Australia) Ltd [No 3]
[2021] WASC 231
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: HUNGRY JACK'S PTY LTD -v- THE TRUST COMPANY (AUSTRALIA) LTD [No 3] [2021] WASC 231
CORAM: TOTTLE J
HEARD: 23 - 24 MARCH 2020, 17 - 26 FEBRUARY 2021 & 8 - 10 MARCH 2021
DELIVERED : 20 JULY 2021
FILE NO/S: CIV 3129 of 2016
BETWEEN: HUNGRY JACK'S PTY LTD
First Plaintiff
SELDEN PTY LTD
Second Plaintiff
AND
THE TRUST COMPANY (AUSTRALIA) LTD
First Defendant
CLASSIC SWAN PTY LTD AS TRUSTEE FOR IANNANTUONI FAMILY TRUST
CELESTINO MARIO IANNANTUONI
GIUSEPPINA ANTONIETTA WETTER
Second Defendants
Catchwords:
Real property - Adverse possession - Application of Limitation Act 1935 (WA) - Claim for possessory title over part of land used to operate drive–through restaurant - Whether exclusive possession in fact established - Whether presence on land pursuant to Halliday v Nevill licence - Whether plaintiff had relevant intention to possess - Where intention inferred from acts of plaintiff - Whether intention negated by belief that land was included as part of a lease of adjoining land - Whether intention negated by belief that land was included in adjoining land possessed by claimant under a licence - Turns on own facts
Real property - Whether informal lease inferred from circumstances - Whether possession pursuant to lease or licence - Exclusive possession not sufficient to establish lease
Statutory interpretation - Transfer of Land Act 1893 (WA) - Whether following statutory procedure mandatory precondition to the grant of relief - Where provisions framed in permissive terms - Where basis of legal interest of predecessors in title not identified - Statutory procedure not a bar to relief sought
Practice and procedure - Evidence - Without prejudice privilege - Whether privilege impliedly waived by nature of case run by plaintiffs - No inconsistency between plaintiffs' case and statements made in without prejudice communications - No waiver of privilege
Maxims - Applicability of maxim ex turpi causa non oritur actio to claim for adverse possession considered
Legislation:
Limitation Act 1935 (WA), s 4, s 5, s 30
Transfer of Land Act 1893 (WA), s 68(1a), s 222, s 223, s 223A
Result:
Preliminary issue determined in favour of the plaintiffs
Declaration made
Category: B
Representation:
Counsel:
| First Plaintiff | : | Dr J T Schoombee |
| Second Plaintiff | : | Dr J T Schoombee |
| First Defendant | : | Mr R W Douglas |
| Second Defendants | : | No appearance |
Solicitors:
| First Plaintiff | : | HWL Ebsworth Lawyers |
| Second Plaintiff | : | HWL Ebsworth Lawyers |
| First Defendant | : | K J Levy |
| Second Defendants | : | No appearance |
Case(s) referred to in decision(s):
Australian Competition and Consumer Commission v Radio Rentals Ltd [2005] FCA 1133; (2005) 146 FCR 292
Bell Group Ltd (in liq) v Westpac Banking Corporation [No 9] [2008] WASC 239; (2008) 39 WAR 1
Ben‑Pelech v Royle [2020] WASCA 168
Caltex Properties Ltd (in liq) v Love (1997) 95 LGERA 132
Cawthorne v Thomas (1993) 6 BPR 13,840
Clowes Developments (UK) Ltd v Walters [2005] EWHC 669 (Ch)
Cubillo v The Commonwealth (No 2) [2000] FCA 1084; (2000) 103 FCR 1
Fabre v Arenales (1992) 27 NSWLR 437
Fowley Marine (Emsworth) Ltd v Gafford [1968] 2 QB 618
General Discounts Pty Ltd v Crosbie [1968] Qd R 418
Goldsworthy Mining Ltd v Federal Commissioner of Taxation [1973] HCA 7; (1973) 128 CLR 199
Halliday v Nevill [1984] HCA 80; (1984) 155 CLR 1
Harris v Wogama Pty Ltd [1969] 1 NSWR 245
Hesse Blind Roller Company Pty Ltd v Hamitoski [2006] VSCA 121
Ho Hang Wan v Ma Ting Cheung (1990) 1 HKLR 649
J A Pye (Oxford) Ltd v Graham [2003] 1 AC 419
J Alston & Sons Ltd v BOCM Pauls Ltd [2008] EWHC 3310 (Ch)
Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298
Lapham v Orange City Council (No 2) [1968] 2 NSWR 667
Les Laboratories Servier v Apotex Inc [2014] UKSC 55; [2015] AC 430
Mackowik v Kansas City St F CBR Co 94 SW 256 (1906)
Malter v Procopets [2000] VSCA 11
Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1
Ofulue v Bossert [2009] Ch 1
Old Papa's Franchise Systems Pty Ltd v Camisa Nominees Pty Ltd [2003] WASCA 11
Panegyres v Medical Board of Australia [2020] WASCA 58
Payne v Parker [1976] 1 NSWLR 191
Petkov v Lucerne Nominees Pty Ltd (1992) 7 WAR 163
Powell v McFarlane (1977) 38 P&CR 452
R (Best) v Chief Land Registrar [2015] EWCA Civ 17; [2016] QB 23
R v Orton [1922] VR 469
Radaich v Smith [1959] HCA 45; (1959) 101 CLR 209
Refina Pty Ltd v Binnie [2009] NSWSC 914
Ronchi v Portland Smelter Services Ltd [2005] VSCA 83
RPS v The Queen [2000] HCA 3; (2000) 199 CLR 620
Schellenberg v Tunnel Holdings Pty Ltd [2000] HCA 18; (2000) 200 CLR 121
Seddon v Smith (1877) 36 LT 168
Shaw v Garbutt (1996) 7 BPR 14,816
Spence v Demasi (1988) 48 SASR 536
Sunny Corporation Pty Ltd v Elkayess Nominees Pty Ltd [2006] VSC 314
The State of Western Australia v JWRL (a child) [No 3] [2010] WASC 294
Thorpe v Frank [2019] EWCA Civ 150; [2019] 1 WLR 6217
Tower Hamlets London Borough Council v Barrett [2006] P&CR 132
Trampoline Enterprises Pty Ltd v Fresh Retailing Pty Ltd [2019] VSCA 74
Trustees of the Michael Batt Charitable Trust v Adams (2001) 82 P&CR 406
West v GIO (NSW) [1981] HCA 38; (1981) 148 CLR 62
Woolcorp Pty Ltd v Rodger Constructions Pty Ltd [2017] VSCA 21
Wretham v Ross [2005] EWHC 1259 (Ch)
Yokogawa Australia Pty Ltd v Alstom Power Ltd [2009] SASC 377; (2009) 262 ALR 738
TOTTLE J:
Introduction
The Dog Swamp Shopping Centre is located in Perth's northern suburb of Yokine. It is owned by the first defendant, The Trust Company (Australia) Ltd ('Trustco'). Contiguous with the shopping centre's southern boundary is a Hungry Jack's fast food restaurant with a drive‑through facility. The primary issue in this action, and the preliminary issue the subject of these reasons, is whether one or other of the plaintiffs has acquired possessory title to the land on which a significant area of the drive through facility is located (the Disputed Land).[1] Trustco holds the paper title. The plaintiffs, Hungry Jack's and Selden are related companies in the common ownership of Competitive Foods Australia Ltd.
[1] Order 18 December 2019 as amended by order made on 16 July 2021.
The restaurant and drive‑through facility are shown in the aerial photograph below:[2]
[2] Exhibit 271.
A diagram showing the boundaries of the Disputed Land, the drive‑through and various features of the Disputed Land and those on adjoining properties is reproduced in the appendix to these reasons together with a series of photographs taken from various positions marked on the diagram.
The Hungry Jack's restaurant was built in 1971. The drive‑through was added in 1980. A series of transactions affecting the paper title to the Disputed Land culminated in the registration of a transfer of the Disputed Land by Selden to Javy Pty Ltd (one of Trustco's predecessors in title) on 12 December 1984. This is the date from which Hungry Jack's contends it has been in exclusive possession of the Disputed Land for the purposes of its claim to adverse possession.
Trustco did not realise the Disputed Land formed part of the land to which it had paper title until late 2015. On 8 December 2016 Trustco sought to fence off the Disputed Land thereby preventing members of the public gaining access to the entrance of the drive‑through.
This action was commenced on 9 December 2016. In response to an application for an injunction, Trustco gave an undertaking not to obstruct public access to the drive-through. On 26 February 2018 I ordered that the matter should proceed to a trial of a preliminary issue to determine whether Hungry Jack's could establish adverse possession.
The trial of this action was originally listed to commence in March 2020, after two days of hearing the trial adjourned part heard owing to the uncertainty of the prevailing COVID‑19 pandemic. The trial recommenced in February 2021.
Trustco disputes the essential elements of the adverse possession claim, that is, it disputes that Hungry Jack's has been in exclusive possession of the land at any time since 12 December 1984 and it disputes that Hungry Jack's had any intention to possess the Disputed Land, that is any 'animus possidendi'.
I have used the following terms to describe the areas of land, other than the Disputed Land, referred to in these reasons: first, I refer to the area of land on which the Hungry Jack's restaurant and the part of the drive‑through that is not on the Disputed Land as the 'Hungry Jack's restaurant site';[3] secondly, I refer to the area of land on which the adjoining Kentucky Fried Chicken (KFC) restaurant and drive‑through is constructed as the 'KFC restaurant site';[4] thirdly, I refer to the area of land on which the Dog Swamp shopping centre and the shopping centre car park are constructed as the shopping centre or the shopping centre car park;[5] and fourthly, I refer to the area comprising the Hungry Jack's restaurant site, the Disputed Land and the car park which is partly on the Hungry Jack's restaurant site, partly on the Disputed Land and partly on adjoining Crown Land as the 'Hungry Jack's pad site'. I explain the derivation of the expression 'pad site' later in these reasons.
[3] Landgate Certificate of Title 2154/888. In the pleadings and in the course of the trial the Hungry Jack's restaurant site was referred to as the 'Leased Land' but that description has the potential to mislead.
[4] Landgate Certificate of Title 2154/887.
[5] Landgate Certificate of Title 2132/244.
I have concluded that adverse possessory title of the Disputed Land has been made out and that the title should be vested in Selden and I set out my reasons in the following paragraphs.
Applicable law
Statutory framework
A right of adverse possession arises if and when the owner's right to bring an action to eject the party in possession has been barred by the expiry of the applicable limitation period.[6]
[6] Ben‑Pelech v Royle [2020] WASCA 168 [53].
In this case the limitation period is that prescribed by the Limitation Act 1935 (WA),[7] and is 12 years from the accrual of the right to take possession.[8] Relevantly, the right to take possession accrues when the person claiming possession and entitled to possession 'has been dispossessed, or has discontinued such possession'.[9] Dispossession occurs when a person comes on to the land of another and discontinuance of possession occurs when a person voluntarily goes out of possession and another assumes possession in their place.[10]
[7] The Limitation Act 2005 (WA) does not apply, because Trustco's cause of action accrued before November 2005, when the Limitation Act 2005 commenced: see Limitation Act 2005 s 2 and s 4.
[8] Limitation Act 1935 (WA) s 4.
[9] Limitation Act 1935 (WA) s 5(a).
[10] Harris v Wogama Pty Ltd [1969] 1 NSWLR 245, 248; Bowman v Tremaine [2016] WASC 294 [34].
The right of action may be barred by the lapse of a 12 year period which may commence prior to the registered proprietor's ownership of the land. So long as the adverse possession is continuous and successive registered proprietors do not dispossess the claimant, then adverse possession will be effective.[11]
[11] Petkov v Lucerne Nominees Pty Ltd (1992) 7 WAR 163, 166.
The Limitation Act does not merely operate as a bar to an action. Rather if adverse possession is established, the registered proprietor's title to the land is extinguished.[12] Thus, title to land arising from adverse possession is an express exception to indefeasibility of registered title under the Transfer of Land Act 1893 (WA).[13]
The guiding principles
[12] Limitation Act 1935 (WA) s 30; Petkov v Lucerne Nominees (166).
[13] Transfer of Land Act 1893 (WA) s 68(1A).
Given the subject matter, it is not surprising the acquisition of title to land by adverse possession has given rise to a substantial body of case law. The wide variety of circumstances in which adverse possession has been claimed means that many of the decisions have limited value as precedents as they are fact specific often turning on the nature of the subject land. In the following paragraphs I will focus on the central legal principles. I will begin by referring to the exposition of those principles by Slade J in Powell v McFarlane:[14]
(1)In the absence of evidence to the contrary, the owner of land with the paper title is deemed to be in possession of the land, as being the person with the prima facie right to possession. The law will thus, without reluctance, ascribe possession either to the paper owner or to persons who can establish a title as claiming through the paper owner.
(2)If the law is to attribute possession of land to a person who can establish no paper title to possession, he must be shown to have both factual possession and the requisite intention possess ('animus possidendi').
(3)Factual possession signifies an appropriate degree of physical control. It must be a single and [exclusive] possession, though there can be a single possession exercised by or on behalf of several persons jointly. Thus an owner of land and a person intruding on that land without his consent cannot both be in possession of the land at the same time. The question what acts constitute a sufficient degree of exclusive physical control must depend on the circumstances, in particular the nature of the land and the manner in which land of that nature is commonly used or enjoyed. In the case of open land, absolute physical control is normally impracticable, if only because it is generally impossible to secure every part of a boundary so as to prevent intrusion. 'What is a sufficient degree of sole possession and user must be measured according to an objective standard, related no doubt to the nature and situation of the land involved but not subject to variation according to the resources or status of the claimants': West Bank Estates Ltd v Arthur, per Lord Wilberforce. It is clearly settled that acts of possession done on parts of land to which a possessory title is sought may be evidence of possession of the whole. Whether or not acts of possession done on parts of an area established title to the whole area must, however, be a matter of degree. It is impossible to generalise with any precision as to what acts will or will not suffice to evidence factual possession. … Everything must depend on the particular circumstances, but broadly, I think what must be shown as constituting factual possession is that the alleged possessor has been dealing with the land in question as an occupying owner might have been expected to deal with it and that no‑one else has done so.
(4)The animus possidendi, which is also necessary to constitute possession, was defined by Lindley MR, in Littledale v Liverpool College (a case involving an alleged adverse possession) as 'the intention of excluding the owner as well as other people.' This concept is to some extent an artificial one, because in the ordinary case the squatter on property such as agricultural land will realise that, at least until he acquires a statutory title by long possession and thus can invoke the processes of the law to exclude the owner with the paper title, he will not for practical purposes be in a position to exclude him. What is really meant, in my judgment, is that the animus possidendi involves the intention, in one's own name and on one's own behalf, to exclude the world at large, including the owner with the paper title if he be not himself the possessor, so far as is reasonably practicable and so far as the processes of the law will allow. (footnoted omitted)
[14]Powell v McFarlane (1977) 38 P&CR 452, 470 ‑ 472.
Slade J added a further observation in relation to the intention to possess:[15]
Though past or present declarations as to his intentions, made by a person claiming that he had possession of land on a particular date, may provide compelling evidence that he did not have the requisite animus possidendi, in my judgment statements made by such a person, on giving oral evidence in court, to the effect that at a particular time he intended to take exclusive possession of the land, are of very little evidential value, because they are obviously easily capable of being merely self‑serving, while at the same time they may be very difficult for the paper owner positively to refute. For the same reasons, even contemporary declarations made by a person to the effect that he was intending to assert a claim to the land are of little evidential value for the purpose of supporting a claim that he had possession of the land at the relevant date unless they were specifically brought to the attention of the true owner. As Sachs LJ said in Tecbild Ltd v Chamberlain, 'In general, intent has to be inferred from the acts themselves.' (footnotes omitted)
[15] Powell v McFarlane (476 – 477).
The principles summarised by Slade J in Powell were explained and expanded upon by the House of Lords in J A Pye (Oxford) Ltd v Graham,[16] in which Lord Browne‑Wilkinson (with whom Lord Bingham, Lord Mackay, Lord Hope and Lord Hutton agreed) gave the leading speech. Lord Hope and Lord Hutton each added some observations of his own.
[16] J A Pye (Oxford) Ltd v Graham [2003] 1 AC 419.
Referring to Slade J's summary of the relevant principles Lord Browne‑Wilkinson stated:[17]
. . . for the most part the principles set out by Slade J as subsequently approved by the Court of Appeal in Buckinghamshire County Council v Moran [1990] Ch 623 cannot be improved upon.
[17] J A Pye (Oxford) Ltd v Graham [31].
Lord Browne‑Wilkinson addressed the concepts of possession, dispossession, ouster and adverse possession.[18] His Lordship referred to 'a long standing confusion as to what constitutes 'dispossession' and the place, if any, of 'adverse possession' in the modern law'.[19] After a discussion about how this confusion arose his Lordship observed that it was unnecessary for a squatter to act adversely to the paper title owner and:[20]
The question is simply whether the defendant squatter has dispossessed the paper owner by going into ordinary possession of the land for the requisite period without the consent of the owner.
[18] J A Pye (Oxford) Ltd v Graham [32].
[19] J A Pye (Oxford) Ltd v Graham [32].
[20] J A Pye (Oxford) Ltd v Graham [36].
Lord Hope made the same point observing that 'adverse' does not describe the nature of the possession that the squatter needs to demonstrate and that no element of aggression, hostility or subterfuge is required.[21]
[21] J A Pye (Oxford) Ltd v Graham [69].
In the course of considering the meaning of the term 'possession' Lord Browne‑Wilkinson responded to a criticism by counsel for both parties to the effect that there was an element of circularity in Slade J's analysis of the term in Powell. His Lordship emphasised that the law had always required both factual possession and an intention to possess and stated:[22]
Counsel for both parties criticised [Slade J's definition of possession] as being unhelpful since it used the word being defined – possession – in the definition itself. This is true: but Slade J was only adopting a definition used by Roman law and by all judges and writers in the past. To be pedantic the problem could be avoided by saying there are two elements necessary for legal possession: (1) a sufficient degree of physical custody and control ('factual possession'); (2) an intention to exercise such custody and control on one's own behalf and for one's own benefit ('intention to possess'). What is crucial is to understand that, without the requisite intention, in law there can be no possession... But in any event there has always, both in Roman law and in common law, been a requirement to show an intention to possess in addition to objective acts of physical possession. Such intention may be, and frequently is, deduced from the physical acts themselves. But there is no doubt in my judgment that there are two separate elements in legal possession.
[22] J A Pye (Oxford) Ltd v Graham [40].
Lord Browne‑Wilkinson explained why an intention to possess was necessary to establish legal possession by reference to the following example:[23]
Suppose a case where A is found to be in occupation of a locked house. He may be there as a squatter, as an overnight trespasser, or as a friend looking after the house of the paper owner during his absence on holiday. The acts done by A in any given period do not tell you whether there is legal possession. If A is there as a squatter he intends to stay as long as he can for his own benefit: his intention is an intention to possess. But if he only intends to trespass for the night or has expressly agreed to look after the house for his friend he does not have possession. It is not the nature of the acts which A does but the intention with which he does them which determines whether or not he is in possession.
[23] J A Pye (Oxford) Ltd v Graham [40].
Lord Hope also emphasised the necessity for factual possession to be accompanied by an intention to possess and that the latter may be inferred from the former:[24]
The acquisition of possession requires both an intention to take or occupy the land ('animus') and some act of the body ('corpus') which gives effect to that intention. Occupation of the land alone is not enough, nor is an intention to occupy which is not put into effect by action. Both aspects must be examined, and each is bound up with the other. But acts of the mind can be, and sometimes can only be, demonstrated by acts of the body. In practice, the best evidence of intention is frequently found in the acts which have taken place.
[24] J A Pye (Oxford) Ltd v Graham [70].
On the subject of the inferences about intention that may be drawn from use and occupation of land, Lord Hutton stated:[25]
I consider that such use of land by a person who is occupying it [doing everything which an owner of land would have done] will normally make it clear that he has the requisite intention to possess and that such conduct should be viewed by a court as establishing that intention, unless the claimant with the paper title can adduce other evidence which points to a contrary conclusion. Where the evidence establishes that the person claiming title under the Limitation Act 1980 has occupied the land and made full use of it in the way in which an owner would, I consider that in the normal case he will not have to adduce additional evidence to establish that he had the intention to possess. It is in cases where the acts in relation to the land of a person claiming title by adverse possession are equivocal and are open to more than one interpretation that those acts will be insufficient to establish the intention to possess. But it is different if the actions of the occupier make it clear that he is using the land in the way in which a full owner would and in such a way that the owner is excluded.
[25] J A Pye (Oxford) Ltd v Graham [76].
As to the nature of the intention required of a squatter, Lord Browne‑Wilkinson expressed his disapproval of statements in earlier cases to the effect it was necessary that the squatter should have an intention to own the land in order to be in possession – all that was required was an intention to possess.[26] Lord Hope made the same point stating:[27]
But it is reasonably clear that the animus which is required is the intent to exercise exclusive control over the thing for oneself ... The only intention which has to be demonstrated is an intention to occupy and use the land as one's own... So I would hold that, if the evidence shows that the person was using the land in the way one would expect him to use it if he were the true owner, that is enough.
[26] J A Pye (Oxford) Ltd v Graham [42].
[27] J A Pye (Oxford) Ltd v Graham [71].
Lord Browne‑Wilkinson dealt with the suggestion that the sufficiency of possession can depend on the intention of the true owner. His Lordship stated:[28]
The suggestion that the sufficiency of the possession can depend on the intention not of the squatter but of the true owner is heretical and wrong… The highest it can be put is that, if the squatter is aware of a special‑purpose for which the paper owner uses or intends to use the land and the use made by the squatter does not conflict with that use, that may provide some support for a finding as a question of fact that the squatter had no intention to possess the land in the ordinary sense but only an intention to occupy it until needed by the paper owner. For myself I think there will be few occasions in which such inference could be properly drawn in cases where the true owner has been physically excluded from the land. But it remains a possible, if improbable, inference in some cases.
[28] J A Pye (Oxford) Ltd v Graham [45].
I will consider some refinements to these central principles in the course of my consideration of the submissions advanced by the parties.
The evidence
The parties adduced a substantial volume of documentary evidence – the trial bundle comprised 335 exhibits and extended to approximately 4,300 pages.
The plaintiffs called two witnesses:
(a)Mr Samuel Morton, who has held the position of general manager of Hungry Jack's Western Australia, since August 2015. Mr Morton started work as a 'manager in training' for the Kentucky Fried Chicken (KFC) Innaloo branch (Innaloo being a suburb near Dog Swamp shopping centre) in October 1980 (the connection between KFC restaurants and Hungry Jack's restaurants is explained later). Mr Morton was familiar with the Hungry Jack's at Dog Swamp from October 1980 for three reasons, first, he drove passed it on his way to and from work, secondly, as part of his duties he was required to collect stock from the Dog Swamp KFC restaurant situated next to the Dog Swamp Hungry Jack's and thirdly, he was curious about the way in which the drive‑through operated because it was a concept new to Perth and, when he started his training at Innaloo, a drive‑through was being constructed at that outlet. In about 1987 Mr Morton was promoted to the position of district manager with responsibility for up to twelve KFC outlets including the Dog Swamp outlet and as a consequence he had ongoing familiarity with the Dog Swamp Hungry Jack's restaurant. Mr Morton was a director of Hungry Jack's from September 2009 to June 2014. After a break in his employment with the Competitive Foods Australia Group in 2014 and early 2015, Mr Morton returned to work for Hungry Jack's in the position presently held by him in mid‑2015.
(b)Ms Jacqueline Hansen, who currently performs a human resources role at Hungry Jack's, was still at school when, in 1975, she first started working for Hungry Jack's at its restaurant in the Perth suburb of Melville. In about 1979 she entered the cadet management program, became a 'cadet manager' and thereafter progressed through the management structure being promoted to the position of a district manager with responsibility for a group of Hungry Jack's restaurants in 1986. In the early 1990s one of the restaurants for which she was responsible was the Dog Swamp Hungry Jack's. From 1996 until 2015 Ms Hansen was the Western Australian State Manager of Hungry Jack's and in that capacity had operational control for all the Hungry Jack's outlets in the State.
Trustco called eight witnesses:
(a)Mr Matthew Seth, a licensed surveyor, who on instructions from Trustco, undertook a 'detail and [boundary] re‑establishment survey' of the Disputed Land on 18 November 2019. Mr Seth prepared a diagram setting out the boundaries of the Disputed Land and identifying various features present on the Disputed Land and adjoining lots. He produced photographs of a number of the features marked on his survey diagram. It is Mr Seth's survey diagram and photographs that are reproduced in the appendix. In addition Mr Seth produced a series of survey diagrams and aerial photographs on which he recorded the title particulars and boundaries of the lots, which had at various dates since 1970, comprised the shopping centre, the Disputed Land and the adjoining lots.
(b)Mr Daniel Lees, a town planner, who compiled a photographic survey of various fast food outlets in the Perth metropolitan area for the purposes of enabling a comparison to be made between the traffic control devices and signage present at those sites and the traffic control devices and signage present on the Disputed Land. In addition, Mr Lees gave some evidence of the zoning of the Disputed Land for planning purposes.
(c)Mr Mario Dilena, who has worked as a barber at the Dog Swamp shopping centre since the late 1960s, and who gave evidence about the development of the shopping centre and the Hungry Jack's drive‑through.
(d)Mr Anthony Metcalfe, who is a quantity surveyor and project manager involved in shopping centre developments and redevelopments. From 2016 he was involved in a redevelopment of the Dog Swamp shopping centre involving an expansion of the available retail space to accommodate a new Aldi supermarket. In addition, Mr Metcalfe gave evidence of the development of the area around the shopping centre having lived in the area as a young man and having been a customer of Hungry Jack's in the late 1970s and early 1980s.
(e)Ms Nikki Panagopoulos, the fund manager for the Australian Unity Diversified Property Fund. Ms Panagopoulos is the person within Trustco who has had ultimate responsibility for the management of the Dog Swamp shopping centre.
(f)Three persons who had direct and close involvement in the management of the Dog Swamp shopping centre – they were:
(i)Mr Gary Wrightson who was an asset manager with Foodland between 1996 and 2004 during which period he was familiar with the Dog Swamp shopping centre as it was refurbished.
(ii)Ms Barbara Morel who was employed as the Centre Manager of the Dog Swamp shopping centre in the period between 2009 and May 2011.
(iii)Mr Tony Davis who was employed as the Centre Manager of the Dog Swamp shopping centre between early 2011 and October 2017.
In my assessment, all of the witnesses gave their evidence truthfully. The elapse of time between the relevant events coupled with the possibility of witnesses' evidence being influenced by a subconscious partisanship with the party who called them, cause me some concern about the reliability of the evidence of the lay witnesses. In making factual findings I have relied, wherever possible, on the contemporaneous documents and on the inherent probabilities given the nature of the land holdings and the commercial uses to which they were put.
A view of the site was conducted on 19 March 2020.
Overview of factual issues
To provide context for the findings that follow the factual issues may be summarised as follows:
Physical custody and control (factual possession)
(a)To what extent, if at all, was the Disputed Land enclosed or otherwise demarcated from the adjoining land?
(b)What development, if any, of the Disputed Land was undertaken by the plaintiffs after 12 December 1984?
(c)To what extent, if at all, did Hungry Jack's demonstrate physical control of the Disputed Land whether by restraints on entry or otherwise?
(d)To what extent, if at all, did Hungry Jack's keep the Disputed Land and things on it clean, tidy and in a good state of repair?
(e)How was the Disputed Land used by Hungry Jack's and members of the public?
(f)To what extent, if at all, did the owners of the Dog Swamp shopping centre or their agents undertake any activities on the Disputed Land?
Intention to possess (animus)
(a)In December 1984 did the plaintiffs possess the Disputed Land with the consent of the shopping centre owner, Javy, pending the construction on the Disputed Land of a crossover between the shopping centre and Wiluna Road?
(b)Did the plaintiffs believe that their presence on the Disputed Land, was, as Trustco contended, 'consensual, temporary, contingent, restricted and subordinate and that they could not and did not intend to exclude all the world'?
(c)Was the existence of any intention to possess undermined or negated by one or more of the following:
(i)uncertainty on the part of the plaintiffs of the ambit of the Disputed Land?
(ii)the absence of any application for development approval or building licence approval with respect to the Disputed Land?
(iii)the basis upon which a valuation of the Hungry Jack's restaurant site was undertaken in March 1998?
(iv)the terms of a sale of the freehold of the Hungry Jack's restaurant site by Selden to Westpac and a related lease by Selden in favour of Hungry Jack's?
(v)the absence of restrictions on others entering the Disputed Land?
Factual findings
The parties
The plaintiffs
In the early 1970s Competitive Foods Australia operated two fast‑food businesses, Hungry Jack's and KFC, the latter being operated by a subsidiary, Competitive Foods Pty Ltd. The Hungry Jack's restaurants were operated under a franchise agreement with Burger King Corporation.[29]
[29] ts 609, Ms Hansen's evidence to the effect that Burger King was 'our franchisor' and exhibit 137.
Selden was primarily involved in the businesses operated by Competitive Foods Australia as the property holding company. It did not operate any restaurants in its own right.[30]
[30] ts 330 and 332.
Mr John ‘Jack’ Cowin is a director of Competitive Foods Australia, Hungry Jack's and Selden.[31] He is, and was, the senior person in the corporate group.[32] I infer that he, or interests associated with him, owned and controlled Competitive Foods Australia and, through it, the Hungry Jack's and KFC businesses.
[31] Exhibits 262, 263 and 268.
[32] 'The functional principal' ‑ 'the company owner': ts 468.
Mr Cowin was involved in obtaining planning approval for the development of the Dog Swamp Hungry Jack's and KFC restaurants. He had discussions and correspondence with the local authority (the City of Stirling) in 1970 and 1971 and during that period held discussions with local residents regarding complaints and concerns held by them about the operation of the restaurants.[33]
[33] Exhibit 324.
Mr Cowin lived in Perth until 1980 when he moved to Sydney.[34]
[34] ts 470.
Trustco contends that it may be inferred from the fact that the plaintiffs did not call Mr Cowin as a witness that his evidence would not have assisted the plaintiffs. This is a matter to which I will return later.
The Dog Swamp Hungry Jack's was one of the first Hungry Jack's restaurants in Western Australia. The Hungry Jack's business has grown significantly over the past 50 years. In 1980 there were eight Hungry Jack's restaurants in Western Australia. There are now 68 Hungry Jack's restaurants in Western Australia.[35]
[35] ts 437, exhibit 198.
In 2016 the Hungry Jack's head office was moved from Perth to Sydney.[36]
[36] ts 328.
For many years a Mr John Butler was involved in the management of Competitive Foods Australia. Mr Butler was an accountant by profession. He was appointed as a director of Selden and Hungry Jack's in 1978.[37] He was appointed as the company secretary of Selden and Hungry Jack's in 1980 and was appointed the company secretary of Competitive Foods Australia in 1984.[38] He was appointed as a director of Competitive Foods Australia in 1984.[39] Mr Butler was Mr Cowin's 'second in command' and the group's senior financial officer.[40] Mr Butler became unwell and resigned from the offices he held in the Competitive Foods Australia group in 2015. He died in November 2017.
Trustco
[37] Exhibits 234 and 235.
[38] Exhibits 233 and 234.
[39] Exhibit 233.
[40] ts 329 ‑ 330 and 469.
Trustco has been the registered proprietor of the Dog Swamp shopping centre and the Disputed Land since March 2011 in its capacity as the 'custodian' of assets held for the investors in the Australian Unity Diversified Property Fund. The Australian Unity Diversified Property Fund is a managed investment scheme, the responsible entity for which is Australian Unity Property Ltd.
The second defendants
The second defendants are the current registered proprietors of the Hungry Jack's restaurant site which they lease to Hungry Jack's. The second defendants have filed a notice of intention to abide the outcome.
Paper title history
The history of the paper title to the Hungry Jack's restaurant site and the Disputed Land is set out in the table below.
Date
Hungry Jack's Restaurant Site
Disputed Land
27 February 1970 (Lot 7)
14 May 1970
(Lot 4)
6 July 1970
(Lots 5 and 6)Selden became the registered proprietor of Lot 4 on Diagram 15198, Lot 5 on Diagram 18685 and Lot 6 and part of Lot 7 on Diagram 17357. These lots and part lot encompassed the Hungry Jack's restaurant site and the KFC restaurant site.[41]
At this date the Disputed Land formed part of the land reserved for a public road though no road had been constructed.
30 August 1974
Selden acquired title to the Disputed Land and it becomes part of Lot 4 on Diagram 15198.[42]
27 February 1975
Selden caused Lots 4 (which included the Disputed Land) and Lots 5, 6 and 7 to be amalgamated to form Lot 15 with the result that the land comprising the Hungry Jack's restaurant site, the KFC restaurant site, and the Disputed Land were amalgamated into Lot 15.[43]
The Disputed Land became part of Lot 15 following the amalgamation described in column 2.
26 January 1977
Selden executed a transfer of part Lot 15 (comprising the Disputed Land) in favour of Javy Pty Ltd, the registered proprietor of the Dog Swamp shopping centre. The transfer was not registered on this date.[44]
27 January 1977
Selden executed a transfer of Lot 15 to Wesfarmers Provident Fund Pty Ltd (Wesfarmers).[45]
27 January 1977
Wesfarmers executed a transfer of the Disputed Land in favour of Selden.[46]
21 April 1977
The portion of Lot 15 that did not include the Disputed Land is designated as Lot 16 and registered in the name of Wesfarmers.[47]
Designated pt Lot 15 on Diagram 41169.[48]
21 April 1983
Wesfarmers transfers Lot 16 to H N Leong and F C Leong.
12 December 1984
The transfer by Selden to Javy was registered.
Subsequently the Disputed Land was incorporated into and formed part of Lot 17 on Diagram 51731.[49]26 August 1985
Javy Pty Ltd transferred Lots 17 (including the Disputed Land, 11 and 13 to Forrester Nominees Pty Ltd.[50]
15 November 1988
The Leongs transferred Lot 16 to Selden.[51]
22 June 1989
Forrester transferred Lots 11, 13 and 17 to Sangora Holdings Pty Ltd.[52]
10 March 1997
Sangora transferred Lots 11, 13 and 17 to Foodland Properties Pty Ltd.[53]
17 April 1998
Foodland caused the titles of Lots 11, 13 and 17 to be amalgamated and redesignated Lot 18 and as a result the Disputed Land becomes part of Lot 18.[54]
15 June 1999
Selden caused Lot 16 to be subdivided and the Hungry Jack's restaurant site was designated Lot 20 and the KFC restaurant site became Lot 19.[55]
9 July 2002
Selden transferred Lot 20 (the Hungry Jack's restaurant site) to Westpac Funds Management Ltd.[56]
19 December 2003
Foodland transferred Lot 18 to Westpac.[57]
17 April 2009
Westpac transferred Lot 20 to the second defendants.[58]
4 March 2011
Westpac transferred Lot 18 to Trust Co.[59]
[41] Exhibits 6, 12 and 71.
[42] Exhibits 6 and 21.
[43] Exhibits 6, 12, 26 and 71.
[44] Exhibit 32.
[45] Exhibit 36.
[46] Exhibit 33.
[47] Exhibit 37.
[48] Exhibit 339.
[49] Exhibits 32 and 57.
[50] Exhibit 66.
[51] Exhibit 68.
[52] Exhibits 69 and 70.
[53] Exhibits 69 and 70.
[54] Exhibit 80.
[55] Exhibit 83.
[56] Exhibit 99.
[57] Exhibit 103.
[58] Exhibit 123.
[59] Exhibit 145.
Location and early development
The location of the Dog Swamp shopping centre is shown on the aerial photograph below:
The shopping centre lies between the eponymous swamp to the north‑west, Wanneroo Road to the west, Wiluna Street to the south and, a further shopping centre, the Flinders Square shopping centre to the east.
The Dog Swamp shopping centre was constructed in 1968.[60] The main customer entrance to the shopping centre building faces south onto a car park that extends to the east and west of the building. To the rear of the main building but within the boundary of the shopping centre, there is a service road. The shopping centre building itself has been renovated and expanded considerably since 1968. To the west of the shopping centre car park there was (and there still is) a service station with a frontage onto Wanneroo Road.
[60] ts 929.
In 1970 Selden acquired land immediately to the south of the shopping centre with a frontage onto Wanneroo Road and Wiluna Street. Competitive Foods Australia obtained approval to build a KFC restaurant and a Hungry Jack's restaurant on the site. The two restaurants were built and began trading in 1971. The street address of the Hungry Jack's restaurant is 8 Wiluna Street, Yokine.
Commercial sites, such as the service station site, the KFC restaurant site, and the Hungry Jack's restaurant site, located on the periphery of a shopping centre are known as 'pad sites' (sometimes referred to as 'free‑standing drive‑throughs'). In a commercial sense, businesses on pad sites complement the businesses operating in the adjoining shopping centre, they are 'traffic generators' that attract customers to the shopping centre and service customers who are otherwise attending the shopping centre.[61]
[61] ts 452 ‑ 453 (Mr Morton); ts 793 (Mr Lees).
In 1949, at an early stage of the urban development of the Dog Swamp locality, a corridor of land running in a north‑south direction on the eastern edge of the land on which the Dog Swamp shopping centre now stands was reserved for the purposes of a road. The proposal was that at its southern end the road would form a junction with Wiluna Street and the junction would incorporate the Disputed Land.[62]
[62] Exhibit 5.
I infer from the contents of a letter from the Town Clerk for the City of Stirling to the Secretary for Local Government dated 29 April 1971,[63] that it was a condition of approval of the development of the KFC restaurant site and the Hungry Jack's restaurant site that the Disputed Land be amalgamated with the titles held by Selden and used for car parking and access from Wiluna Street. The relevant portion of the letter read:
. . . the triangular section of the Wiluna Street road reserve east of Lot 15 should be used for parking and access to the site. One of the conditions of the Legal Agreement is that the only Street access to the site shall be over the triangular section of land.
Action has already been taken by the City to have this portion of the road closed, and Council is still awaiting a reply from the Department of Lands and Surveys in this regard.
If the triangular portion of road has not been amalgamated with Lot 15 when a development application is made, then amalgamation will be a condition of approval.
[63] Exhibit 324, 3915.
Although the reference in the letter to 'Lot 15' is difficult to reconcile with the lot numbers of the land then held by Selden, the context makes it clear that the Town Clerk was referring to the Disputed Land. An explanation for the reference to Lot 15 may be that a survey diagram showing the prospective amalgamation of the then existing lots had been prepared showing them redesignated as Lot 15 because that was what ultimately occurred.
For completeness I mention that in 1971 local residents objected to access to the KFC restaurant site and the Hungry Jack's restaurant site being obtained from Wiluna Street and sought to persuade the City (unsuccessfully) to impose a condition that access to the site be obtained from the shopping centre car park rather than from Wiluna Street.[64] Mr Cowin was involved in discussions with the local residents on this and other concerns held by them.
[64] Exhibit 324, 3878.
To the east of the Disputed Land is an area of land that had also formed part of the road reserve. In this litigation this area has been referred to as the 'Crown Land' and its location is depicted in the aerial photograph. The Crown Land is in two parts: one part is incorporated in the bituminised car park to the east of the entrance to the drive‑through lane. This bituminised part is separated from the balance of the Crown Land, which is a grassed area, by a retaining wall that is between approximately 0.1 metres and 0.76 metres high (the Eastern Retaining Wall).[65] The land to the east of the Eastern Retaining Wall (the grassed area) is between 0.65 metres and 0.17 metres lower than the land to the west of the wall and there is a telephone box on it. The Disputed Land cannot be accessed by motor vehicle from any part of the Crown Land that lies to the east of the Eastern Retaining Wall (that is from the grassed area). The Eastern Retaining Wall and the location of the bituminised and grassed areas of the Crown Land are shown in photographs D, E, and L in the appendix.
The Selden – Wesfarmers – Javy transactions
[65] Statement of Agreed Facts filed 11 March 2020 [40].
Unsurprisingly given the transactions occurred in 1977, the documents relating to the transfer of the Disputed Land to Javy were limited, and those that there were available, presented something of an enigma.
In logical, rather than chronological order, the sequence was as follows. Selden executed a transfer of 'Lot 15 on Diagram 41169 and being the whole of the land comprised in Certificate of Title Volume 1401 Folio 536' (that is the Hungry Jack's restaurant site, the KFC restaurant site and the Disputed Land) in favour of Wesfarmers. This transfer was dated 27 January 1977 and the consideration was recorded as $360,000 'and Pursuant to Declaration of Trust dated 27th day of January 1977'.[66] The transfer was registered on 2 February 1977. The declaration of trust was recorded in a letter dated 27 January 1977 from Wesfarmers to Selden which read:[67]
We refer to the Contract of Sale and Purchase between Wesfarmers Provident Fund Pty Ltd, and Selden Pty Ltd, bearing even date herewith with respect to the land and improvements therein described as 'the property' which forms part of the land comprised in Certificate of Title Volume 1401 Folio 536.
For the purposes of expediting settlement of the sale and purchase of 'the property' Wesfarmers Provident Fund Pty Ltd, agrees to take a transfer of All of the land comprised in Certificate of Title Volume 1401 Folio 536 and HEREBY ACKNOWLEDGES that it holds that part of the land comprised in Certificate of Title Volume 1401 Folio 536 as is comprised in Lot 17 on Diagram 51731 which land is not included in 'the property' upon trust for Selden Pty Ltd, and will transfer the same to Selden Pty Ltd, or as directed by Selden Pty Ltd, as and when requested by Selden Pty Ltd, at the cost of Selden Pty Ltd in all respects.
[66] Exhibit 36.
[67] Exhibit 34.
On 27 January 1977 Wesfarmers executed a transfer in favour of Selden in respect of the Disputed Land which was described as follows:[68]
ALL THAT piece of land being Portion of Perthshire Location A and being so much of Lot 15 on Diagram 41169 as is comprised in Lot 17 on Diagram 51731 and being part of the land comprised in Certificate of Title Volume 1401 Folio 536.
[68] Exhibit 33.
The consideration for the transfer was recorded as 'Pursuant to Declaration of Trust dated 27th day of January 1977'. Diagram 51731, (referred to in the transfer) was prepared following a survey undertaken in 1975. It showed the Disputed Land incorporated within the boundary of a lot numbered 17. Lot 17 encompassed the land forming the southern portion of the shopping centre car park. The diagram shows the balance of Lot 15 redesignated as Lot 16. Diagram 51731 was approved by the Town Planning Board on 7 December 1976. It was marked 'In order for dealings subject to 2 Owners' on 14 January 1977 and approved by the Inspector of Plans and Surveys on 12 December 1984.[69]
[69] Exhibit 60.
The transfer of the Disputed Land from Selden to Javy was dated 26 January 1977.[70] The description of the land was identical to the description contained in the Wesfarmers to Selden transfer of the Disputed Land dated 27 January 1977. The consideration was recorded as $50.[71]
[70] Exhibit 32.
[71] Exhibit 32.
I interpolate that on 27 January 1977 Wesfarmers granted Selden a lease of 'Lot 16' for a term of 10 years (with options to extend by two further periods of 5 years).[72] The terms of the lease recorded that the leased premises would be used as take away food outlets under the names Kentucky Fried Chicken and Hungry Jack's and that such uses were permitted uses and would not involve any breach of the covenant against assignment, subletting or parting with possession.[73]
[72] Exhibit 35.
[73] Exhibit 35, cl 6.13, 6.14 and 8.01.
Selden's interest in the Disputed Land was protected by a caveat registered against Wesfarmer's title. The transfers of the Disputed Land by Wesfarmers to Selden and Selden to Javy were not registered until 12 December 1984.
The evidence does not explain why it took nearly eight years for diagram 51731 to be approved and for the transfers of the Disputed Land to be registered. By way of comparison Wesfarmers obtained a new title to Lot 16 in respect of the balance of the land that had formed Lot 15 on 21 April 1977 and transferred that lot to a third party on 21 April 1983.[74]
[74] Exhibits 37 and 52.
Trustco contended that the failure by the plaintiffs to adduce evidence explaining Selden's transfer of the Disputed Land to Javy tells fatally against concluding that Hungry Jack's intended to possess and did in fact possess the Disputed Land on and after 12 December 1984. This contention must be assessed against the background of the events that occurred between 1977 and 1984 which I will now outline.
The development of the drive‑through
In November 1979 Selden applied for approval to construct drive‑through facilities as additions to the Dog Swamp KFC and Hungry Jack's restaurants.[75] For the purposes of providing background to issues discussed later it is necessary to mention the following details.
(a)The location of the land in respect of which the application was made was specified as 'Lot 16'.
(b)The site plan prepared for the purposes of the application provided for the relocation of the crossover between Wiluna Street onto the Disputed Land and the creation of a new 12 metre crossover.[76] The eastern end of the proposed crossover aligned with the entries to the car bays proposed to be positioned along the Eastern Retaining Wall.
(c)Annotations on the site plan prepared for the purposes of the application proposed the construction of a 'new retaining wall' to the east of the north eastern corner of the Hungry Jack's restaurant building along the northern boundary to a point approximately half way along the drive‑through lane. A further annotation proposed that a 'traffic rail' be added to the 'existing retaining wall' which was shown as commencing at the point that the 'new retaining wall' finished.
(d)Approval for the development was given in January 1980.
(e)A site plan prepared for the purposes of obtaining a building licence for the Hungry Jack's drive‑through showed the crossover from Wiluna Street positioned further to the west than was shown in the plan that accompanied the application in 1979.[77] The position of the crossover on the building licence site plan accords with its present location.
[75] Exhibit 324.
[76] Exhibit 324, 3835.
[77] Exhibits 317, 3571 and exhibit 324, 3835.
In late 1980 Hungry Jack's built the drive‑through. This involved the following:[78]
[78] See exhibits 317 and 324 and the Statement of Agreed Facts.
(a)The construction of a retaining wall (the Northern Retaining Wall) along the northern edge of the Hungry Jack's restaurant site and the Disputed Land and the installation of a steel balustrade (more precisely described as a 'Guard Rail W‑Beam') along the top of the wall. The guard rail did not and does not extend along the entire length of the Northern Retaining Wall, it stops about 8 metres from the junction of the northern and eastern boundaries of the Disputed Land. The height of Northern Retaining Wall is between 0.74 and 0.83 metres above the level of the shopping centre car park to its north.[79] The Northern Retaining Wall and guard rail as viewed from the shopping centre car park may be seen in the photographs A and B in the appendix.
[79] Statement of Agreed Facts [32].
(b)The construction (using concrete) of the drive‑through lane itself – part of the drive‑through lane is on the Disputed Land and part is on the Hungry Jack's restaurant site. The drive‑through lane is a hockey stick shape – the shaft runs parallel with the Northern Retaining Wall and the hook or head curves around to the south when the lane meets the eastern wall of the restaurant.
(c)The laying of a bituminised surface over the land to the east of the Hungry Jack's restaurant building to form the access to the drive‑through and a car park. This bituminised area covered: part of the Hungry Jack's restaurant site; those parts of the Disputed Land that did not form part of the drive‑through lane or the garden bed to which I refer below; and the part of the Crown Land that lay to the west of the Eastern Retaining Wall. The boundaries of the Hungry Jack's restaurant site, the Disputed Land and the Crown Land were not marked on the bituminised surface that is to say, adopting the plaintiffs' language, 'the Disputed Land [was] visually, structurally and functionally an indistinguishable part of the rest of Hungry Jack's Dog Swamp'.[80] The position of the boundaries of each component of the area just described is shown in the diagram in the appendix and the area is shown in photographs F and J.
[80] Plaintiffs' note of proposed findings of fact and holdings of law filed 20 March 2020 [8].
(d)The creation of a landscaped garden bed partly on the Hungry Jack's restaurant site and partly on the Disputed Land. The garden bed is approximately 22 metres long. The portion of garden bed on the Disputed Land is at least 15 metres long from its western most point to its eastern most point. At its widest point, the portion of the garden bed on the Disputed Land is approximately 4 metres wide.[81] A reticulation system was installed to water the garden bed with the water and power being supplied from the Hungry Jack's restaurant. The garden bed, in its present condition, may be seen in photographs A, H and F in the appendix.
[81] Statement of Agreed Facts [35].
(e)Various features whose purpose was to control the flow of traffic and car parking. These features were as follows:
(i)the laying of curbing to delineate the drive‑through lane and the edge of the car parking areas – the curbing is partly on the Disputed Land and partly on the Hungry Jack's restaurant site;
(ii)the painting of directional arrows on the bitumen surface of the Disputed Land pointing to the entry to the drive‑through lane;[82]
(iii)the installation on the Disputed Land of protective bollards on the garden bed side of the entry to the drive‑through lane;
(iv)the marking out of car parking bays by painting lines on the bitumen surface – three parking bays are wholly within the curtilage of the Disputed Land and one is partly on the Disputed Land and partly on the Hungry Jack's restaurant site, in addition there are four parking bays on the Crown Land to the west of the Eastern Retaining Wall;
(v)adjacent to the entry to the drive‑through lane on the Disputed Land a sign displaying the Hungry Jack's logo with the words 'Drive‑Thru' below it (this can be seen in photograph I in the appendix); and
(vi)the construction on the Disputed Land of a 'speed hump' at the entry to the drive‑through (part of which can be seen in photograph I in the appendix).[83]
(f)The installation of a menu board on the Hungry Jack's restaurant site on the north side of the drive‑through close to the ordering station to which I refer below. Although the evidence was silent as to its presence, I infer that in addition to the menu board, a 'pre‑ordering board' was installed which displayed the food items that could be purchased at the drive‑through. I draw the inference that such a board was installed because one is, and has been, present on the garden bed side of the drive‑through for some years and a pre‑order board appears to be integral to the efficient operation of a drive‑through system.
(g)The installation of an ordering station – a speaker unit mounted on a pole – into which customers spoke for the purpose of giving their orders. The ordering station was installed on the northern side of the drive‑through lane approximately where the lane turned to run parallel with the eastern wall of the restaurant building. The speaker system was linked by underground cabling connected to an audio system within the restaurant.
(h)The installation on the Disputed Land of a rubbish bin at the end of the garden bed closest to the entrance of the drive‑through lane (though not entirely clear the bin can be seen in photographs D and E in the appendix).[84]
(i)The erection of a 'height bar' on the Disputed Land at the entrance to the drive‑through lane. Mr Morton's evidence was that this was erected in 1980 'because the danger of [vehicles] hitting the canopy or the structure of the building'.[85] Although the evidence when the height bar was erected was limited, I think it is likely that the height bar was erected when the drive‑through was first constructed as a precautionary measure to reduce the risk of larger vehicles damaging the structure of the Hungry Jack's restaurant building.
[82] Mr Morton couldn't say whether the directional arrows visible on the bitumen were there in 1980 but the sense of his qualification is that the directional arrows have been there for a number of years but not necessarily in the same place ‑ ts 467.
[83] ts 340.
[84] ts 466.
[85] ts 347.
In about 1984 the ordering station and the menu board were moved from their original positions. The ordering station was moved to a position about half way along the northern side of the drive‑through lane to the position that the ordering station presently stands on the Disputed Land. The menu board was moved to its present position on the garden bed side of the drive‑through lane so that it could be seen by a customer placing an order from a car pulled up alongside the ordering speaker, (the menu board can be seen in photograph A in the appendix). One of the supports of the menu board is on the Hungry Jack's restaurant site and the other is on the Disputed Land. These changes were made to improve the drive‑through service.[86] When the ordering station was relocated a sensor pad was installed beneath the drive‑through lane close to the ordering station. The sensor pad sent a signal to the Hungry Jack's restaurant to notify staff that a vehicle had entered the drive‑through. The sound sensor or loop has been replaced from time to time as technology improved.[87] From at least the latest the date the menu board was moved to the position I have just described a pre‑order board has been located in the garden bed on the Disputed Land on the southern side of the drive‑through lane.
[86] ts 342 ‑ 343.
[87] ts 340 ‑ 341.
The issue of when a canopy was first erected over the ordering station (an 'ordering canopy') was controversial. When the drive‑through was first constructed there was no ordering canopy. I base this finding on the fact that no ordering canopy is shown on either site plan prepared for the construction of the drive‑through.[88] Further, no ordering canopy can be seen on the photographs taken in 1981 or 1985.[89] In a photograph taken in 1995,[90] there appears to be a canopy extending from the restaurant building itself to provide protection for vehicles stationary by the servery window in the drive‑through lane but no ordering canopy is visible. Nor is an ordering canopy visible in an aerial photograph taken in December 2003.[91]
[88] Exhibit 317, 3571 and exhibit 324, 3835.
[89] Exhibits 45, 63 and 64.
[90] Exhibits 73 and 74.
[91] Exhibit 105.
Mr Morton's evidence was to the effect an ordering canopy was erected in 1984 and that it was 'upgraded at least twice'. [92] Mr Morton's recollection was the original canopy was a 'simpler structure'.[93] The canopies subsequently erected were elaborate and extended across the width of the drive‑through lane.
[92] ts 341.
[93] ts 342.
The documentary evidence shows that planning approvals were obtained for ordering canopies in 2004,[94] and 2012.[95] Mr Morton's evidence to the effect that there had been an ordering canopy over the ordering station since 1984 was challenged on the basis that the architectural drawings prepared in 2012 showed a canopy structure described as 'New Drive Thru Canopy' (a description contrasted with the reference to a 'new height limit bar to replace existing [height limit bar]', (emphasis supplied)) and it was suggested to him that this description meant that there was no pre‑existing canopy.[96] The architectural drawings prepared in 2004 refer to the construction of a 'new canopy'.[97] As described in the drawings, this canopy was a substantial structure with concrete footings and a steel framed cantilevered roof. An ordering canopy situated on the Disputed Land can be seen in an aerial photograph taken in December 2006.[98]
[94] Exhibit 322.
[95] Exhibit 328.
[96] ts 558 – 561, exhibit 328, 4152.
[97] Exhibit 322.
[98] Exhibit 113, ts 581.
On the basis of the 2004 architectural drawing and the 2006 aerial photograph I find that in 2004 an ordering canopy as shown in the 2004 drawings, and as visible in the 2006 photograph, that is a canopy extending over the width of the drive‑through, was erected on the Disputed Land.
I am confident that Mr Morton was truthful in his evidence that a simpler form of canopy had been erected in 1984. On the basis that there is no reference to a canopy over the ordering station in contemporaneous documents and a canopy of the dimensions visible in the 2006 photographs is not visible in the earlier photographic evidence, I am not satisfied that in 1984 there was a canopy of the dimensions of that subsequently erected but I find that a canopy of a limited size, large enough only to protect the ordering station equipment itself but not extending over the drive‑through lane, was installed in 1984. I make this finding for two reasons. First, because it is supported by Mr Morton's evidence which I accept and, secondly, I infer the ordering station required some form of protection from the elements. The limited size of the 1984 ordering station explains why it was not visible on the aerial photographs (even on the later aerial photographs which are of better quality it is hard to make out the ordering canopy erected in 2004) and why approval was not necessary.
At some point – the evidence does not permit a finding as to when – a cable conduit was secured to the top of the Northern Retaining Wall housing a cable running from the Hungry Jack's restaurant. Over time the conduit was damaged and fell into a state of some disrepair. In 2012 a contractor retained by Hungry Jack's approached Mr Davis (the then manager of the shopping centre) and sought permission to run cabling contained in a conduit on the northern side of the Northern Retaining Wall and Mr Davis gave permission as 'a good neighbour'.[99] Part of the length of the conduit can be seen in photograph C in the appendix.
Drainage easement
[99] ts 1028 ‑ 1029.
In 1982 and 1983 there was correspondence between the City of Stirling, and Selden in which the City sought Selden's consent to the creation of a drainage easement over 'Pt Lot 15 Wiluna Street, Yokine'.[100] The City of Stirling sought Selden's consent because the caveat recorded against Wesfarmers' title gave notice that Wesfarmers held the land on trust for Selden.
[100] Exhibits 47, 48, 49, 50, 53 and 54.
The easement was for an underground drainage pipe. The City's correspondence attached a plan showing that the drainage pipe was to run from the Crown Land onto the Disputed Land (in a line roughly parallel with the southern boundary of the shopping centre car park) before turning to the north‑west at a point close to the entry to the drive‑through lane and from there crossing under the car park of the shopping centre before emptying into the Dog Swamp itself to the north west of the shopping centre.
In response to a request for consent to the easement, concern was expressed on Selden's behalf that 'the drainage easement which the City of Stirling has requested lies exactly at the entrance of our Drive‑Thru service facility'.[101]
[101] Exhibit 50.
In a letter to the City dated 31 May 1983 signed by Mr Butler on behalf of Selden he stated:[102]
Please be advised that Selden Pty Ltd, as lessees of the above property, is prepared to provide an easement to the City of Stirling.
I believe you will also require the permission of the owners who are Leongs Investment Trust...
[102] Exhibit 54.
Ultimately, however, it was Javy and not the Leongs who executed a deed of easement on 10 December 1984.[103]
Javy did not consent to Hungry Jack's use and occupation of the Disputed Land pending construction of an interchange with Wiluna Street
[103] Exhibit 59.
I return to Trustco's contentions concerning the inferences to be drawn from Selden's transfer of the Disputed Land to Javy. Trustco submitted 'where Selden had finally and self‑consciously executed a long‑planned sale and transfer to Javy, there must be significant doubt – if not disbelief – as to any contention that Selden intended to adversely possess the land it had just conveyed',[104] and 'the transfer by Selden for a peppercorn price suggests some arrangement between Selden and Javy, and some quid pro quo'.[105] These submissions culminated in the submission that:[106]
...the peppercorn purchase price, the odd shape and size of the land and its limited utility for most purposes (at least in 1977 and 1984), and the history of the City of Stirling proposing an interchange at the situs of the disputed land suggest that Selden sold the Disputed Land to Javy as part of a contemplated interchange on the site, which could comprise a known purpose which would not be transgressed by Selden building on the land in the interim, which is inconsistent with possession in fact or animus possidendi. Consistent use remains a relevant factor, and may comprise a decisive factor, in assessing both factual possession and intention to possess. Where the trespasser’s acts had not been inconsistent with the future planned use, not therefore manifesting the requisite intention of dispossessing the owner, one might more readily conclude that the requisite elements for adverse possession had not been established.
Plaintiffs at all times believed that once their permission lapsed, the right to possess the Disputed Land lay with (whom they conceived to be) the true owner, not with them. It is enough that, having regard to the actual nature of the permission given, and believed to be given, no plaintiff intended to exclude all the world, nor thought it could, nor attempted to do so, where mistaken belief of consent may negative an intention to possess.
[104] First defendant’s outline of closing submissions filed 5 March 2021 [15].
[105] First defendant’s outline of closing submissions filed 5 March 2021 [17].
[106] First defendant’s outline of closing submissions filed 5 March 2021 [71(h)‑(i)].
The substance of the inference Trustco asks the court to draw is that Selden agreed to transfer the Disputed Land to Javy to enable Javy to use it to construct a crossover (interchange) from Wiluna Street onto the shopping centre car park and that the consideration for this transfer was $50 and Javy's consent to Hungry Jack's use of the Disputed Land for the purposes of a drive‑through pending the construction of the crossover.
The contention that such an inference should be drawn was not a matter raised in Trustco's defence nor in its statement of proposed findings of fact and holdings of law (incorporated into its opening submissions). Rather in the latter document Trustco contended that 'from at least 1980 and through most of the relevant period . . . [Hungry Jack's] believed that it was entitled to be present on the Disputed Land by reason that the lessor of the [Hungry Jack's restaurant site] granted permission' and that elements of that belief included that '[t]he Disputed Land formed part of the land that Hungry Jacks leased, initially from Selden, and ultimately from the second defendants'.[107]
[107] First defendant's proposed findings of fact and holdings of law filed 22 March 2020 [77] and [78(c)].
In closing oral submissions Trustco raised a further argument with which it attempted to buttress the contention that in December 1984 Hungry Jack's was present on the Disputed Land with Javy's consent. Trustco contended the court should hold that it was an implied term of the contract pursuant to which the transfer of the Disputed Land to Javy was effected that vacant possession would be given on settlement.[108] Trustco's counsel contended for a finding that vacant possession was in fact given but 'if there was any continuing right of use by Hungry Jack there afterwards, it was pursuant to an arrangement whereby this land would be used by consent for the purpose of an interchange – being the singular interchange on Wiluna Street.' Trustco contended also that if the plaintiffs did not in fact give vacant possession to Javy then the failure to do so was a breach of the contract with Javy.[109] It was contended that in those circumstances the general principle that a person should not be permitted to benefit from their own wrongdoing encapsulated in the maxim ex turpi causa non oritur actio,[110] prevented the plaintiffs from claiming on the basis their possession was adverse to Javy.
[108] ts 1332.
[109] ts 1297.
[110] 'No right of action arises from a shameful cause'.
There are a number of answers to Trustco's breach of contract contention:
(a)First, the contract between Selden and Javy, if there was one, was not in evidence and nor was there any suggestion in any of the contemporaneous documents that such a contract was brought into existence (there is a reference to the contract between Selden and Westfarmers in Wesfarmers' letter to Selden of 27 January 1977 but not to a contract between Javy and Selden).
(b)Secondly, there is no evidentiary basis for concluding that there was any change in who was in factual possession on 12 December 1984 being the date the transfer to Javy was registered. Hungry Jack's used and occupied the Disputed Land in the same manner both before and after registration of the transfer. Trustco's reliance on a contractual 'presumption of regularity' does not advance its case, assuming the presumption arises in this case, a court does not subordinate findings of fact on the evidence to a legal presumption: 'Presumptions may be looked at as the bats of law, flitting in the twilight, but disappearing in the sunshine of actual facts'.[111]
(c)Thirdly, as is observed in Jourdan & Radley‑Gardner's Adverse Possession,[112] (albeit in a different context) given the law of adverse possession is concerned with rendering lawful conduct which initially constitutes the tort of trespass, it is not obvious why the principle encapsulated in the ex turpi causa non oritur actio should apply.[113]
(d)Fourthly, as counsel for the plaintiff rightly points out[114] the reliance on the doctrine ex turpi causa non oritur actio was not pleaded, nor is there any mention of it in the written submissions. Recent authority established that reliance on the doctrine ex turpi causa non oritur actio must be pleaded.[115]
(e)Fifthly, although it is unnecessary for me to reach a conclusion, there is significant doubt that the doctrine ex turpi causa non oritur actio would apply even if a contract between Selden and Javy existed and was in evidence, and if a breach of that contract by Selden was proved. In Les Laboratories Servier v Apotex Inc,[116] Lord Sumption JSC, with whom Lord Neuberger PSC and Lord Clarke JSC agreed, synthesised the common law origins of the doctrine and stated:[117]
The ex turpi causa principle is concerned with claims founded on acts which are contrary to the public law of the state and engage the public interest...
In my opinion the question what constitutes 'turpitude' for the purpose of the defence depends on the legal character of the acts relied on. It means criminal acts, and what I have called quasi‑criminal acts. This is because only acts in these categories engage the public interest which is the foundation of the illegality defence. Torts (other than those of which dishonesty is an essential element), breaches of contract, statutory and other civil wrongs, offend against interests which are essentially private, not public. There is no reason in such a case for the law to withhold its ordinary remedies. The public interest is sufficiently served by the availability of a system of corrective justice to regulate their consequences as between the parties affected.
(f)Finally, if there was a breach of contract as alleged by Trustco it was actionable by Javy and it was of no continuing relevance when the paper title was transferred to Forrester Nominees Pty Ltd in August 1985.
[111] Mackowik v Kansas City St F CBR Co 94 SW 256 (1906), 262.
[112] Jourdan S QC and Radley‑Gardner O, Adverse Possession (2nd ed, 2011) [9.44] ‑ [9.56]; see also Butt P, Land Law (6th ed, 2010) [7.140].
[113] See also R (Best) v Chief Land Registrar [2015] EWCA Civ 17; [2016] QB 23.
[114] ts 1467.
[115] Trampoline Enterprises Pty Ltd v Fresh Retailing Pty Ltd [2019] VSCA 74 [120].
[116] Les Laboratories Servier v Apotex Inc [2014] UKSC 55; [2015] AC 430.
[117] Apotex [25], [28].
I do not accept that the inference Javy allowed Hungry Jack's to use the Disputed Land pending the construction of a crossover arises. Before setting out my reasons I must deal with an application by Trustco to admit evidence of statements made in without prejudice correspondence which it contended supported the drawing of the inference.
The statements Trustco sought to have admitted were contained in a letter dated 15 February 2021 endorsed with the words 'without prejudice and save as to costs' sent by Competitive Foods Australia's 'Group General Manager', Mr Ian Parker, to the Chief Executive Officer of Australian Unity Property Funds Management Pty Ltd, Ms Esther Kerr‑Smith. Trustco contended that any 'without prejudice' privilege that may have attached to the letter had been waived.
Some background is required to put the application in context. In the course of cross‑examining Mr Morton, Trustco's counsel invoked the 'Orton procedure',[118] and with leave, showed the letter of 15 February 2021 to Mr Morton and asked him whether he wished to change the evidence that he had given a few minutes earlier to the effect that he would not speculate as to the reason for Selden selling the Disputed Land to Javy in 1977.[119] I pause to record that Trustco's counsel relied on the Orton procedure on the basis that Mr Parker's letter was inadmissible, however, before closing its case Trustco's counsel sought to tender the letter. I heard the parties' submissions on the tender of the letter and reserved my decision on its admissibility.
[118] ts 497 and 520. Stemming from R v Orton [1922] VR 469, and see also The State of Western Australia v JWRL (a child) [No 3] [2010] WASC 294.
[119] ts 521 ‑ 522.
The critical paragraph in the letter was in the following terms:
Hungry Jack's has been operating from the Dog Swamp site since 1971. One of our other group companies, Selden, first acquired the entire parcel of land in 1970 and for reasons unknown we sold the small disputed parcel to the then owner of the Dog Swamp Shopping Centre site for $50 in 1977. I say 'reasons unknown' because our then CFO has passed on and so he cannot confirm as to why we would have sold this piece of property for a peppercorn price. The only thought we can come up with is that the then owner of the Dog Swamp Shopping Centre was seeking to change the site egress which would have resulted in more shoppers and hence more potential customers for Hungry Jack's. While the agreement to sell the piece of property was dated 1977, the transfer was not effected on the WA property register (i.e. now Landgate) until 1984. In 1980 Hungry Jack's constructed a drive‑thru on part of the Disputed Land which it has operated continuously and uninterrupted since that time. (emphasis added)
Statements expressed to be made on a 'without prejudice' basis, that is in an attempt to settle a dispute or action, are privileged. The test is whether the communication was part of a genuine attempt to settle a dispute, if so, the whole course of the negotiations is privileged.[120]
[120] Old Papa's Franchise Systems Pty Ltd v Camisa Nominees Pty Ltd [2003] WASCA 11 [91] (McLure J, Murray & Parker JJ agreeing).
I reject the tender of the of Competitive Foods Australia's letter of 15 February 2021 for the following reasons.
(a)First, I accept that the letter is covered by without prejudice privilege. Trustco contended that the letter was 'at best, only tangentially a without prejudice communication'.[121] Trustco relied also on the fact that the plaintiffs had waived claims to privilege in respect of other without prejudice correspondence. The plaintiffs' counsel described it as the 'opening shot' in settlement negotiations.[122] I accept the contents of the letter were communications that were made on a without prejudice basis with a view to attempting to reach a compromise. The waiver (by both parties) of without prejudice privilege in respect of other items of correspondence is irrelevant. I have formed this view based on the fact that the letter was plainly part of a genuine attempt to settle a dispute, as much is clear from:
[121] First defendant’s outline of submissions as to admissibility of plaintiffs’ 15 February 2021 letter filed 4 March 2021 [23].
[122] Plaintiffs’ note opposing admission of “without prejudice” letter dated 15 February 2021 filed 5 March 2021 [4].
(i)The stated purpose of the letter being 'an attempt to avoid wasting any further resources on a dispute between our companies'.
(ii)The outlining of the history of the dispute and the reference to previous attempts to resolve the dispute on a commercial basis.
(iii)The inclusion of a statement to the effect that proceeding to trial would result in a uncommercial outcome for both parties.
(iv)The statement by Mr Parker that the parties should seek to negotiate a commercial outcome rather than 'waste more time and money in the courts'.
(b)Secondly, while I accept that a party may waive 'without prejudice' privilege impliedly in the same way that legal professional privilege may be the subject of an implied waiver,[123] I do not accept that there has been any inconsistent conduct by the plaintiffs capable of amounting to an implied waiver. The applicable legal principle (expressed by reference to the implied waiver of legal professional privilege) was stated by Gleeson CJ, Gaudron, Gummow and Callinan JJ in their joint judgment in Mann v Carnell,[124] as follows:
Waiver may be express or implied. Disputes as to implied waiver usually arise from the need to decide whether particular conduct is inconsistent with the maintenance of the confidentiality which the privilege is intended to protect. When an affirmative answer is given to such a question, it is sometimes said that waiver is 'imputed by operation of law' (eg, Goldberg v Ng (1995) 185 CLR 83 at 95). This means that the law recognises the inconsistency and determines its consequences, even though such consequences may not reflect the subjective intention of the party who has lost the privilege. Thus, in Benecke v National Australia Bank ((1993) 35 NSWLR 110), the client was held to have waived privilege by giving evidence, in legal proceedings, concerning her instructions to a barrister in related proceedings, even though she apparently believed she could prevent the barrister from giving the barrister’s version of those instructions. She did not subjectively intend to abandon the privilege. She may not even have turned her mind to the question. However, her intentional act was inconsistent with the maintenance of the confidentiality of the communication. What brings about the waiver is the inconsistency, which the courts, where necessary informed by considerations of fairness, perceive, between the conduct of the client and maintenance of the confidentiality; not some overriding principle of fairness operating at large.
The plaintiffs' case is that the intention to possess is to be inferred from physical possession of the Disputed Land. Nothing said in the relevant paragraph of the letter is inconsistent with that case. Whilst questions of fairness are a subordinate consideration, there is no unfairness in allowing the plaintiffs to maintain the without prejudice privilege in respect of the letter. Further, the sentence relied on as amounting to an admission, 'The only thought we can come up with...', when read in context, reflects the outcome of speculation some 44 years after the event, engaged in because the actual reasons for the transactions are not known. Even if admitted to evidence the statement would be of negligible value and would fall well short of an 'admission'.
(c)Finally, I agree with the plaintiffs' submission that to conclude that there had been a waiver of without prejudice privilege in the circumstances of this case would render the privilege of very limited utility.[125] To paraphrase remarks made by the Honourable Dyson Heydon QC in another context,[126] sharp‑witted, industrious and well paid legal practitioners will not be slow to construe concessions and admissions made in without prejudice communications as inconsistent with the case being run by the party on whose behalf the communications were made and thereafter trial judges would be bedevilled with applications to admit statements made in without prejudice communications.
[123] See Yokogawa Australia Pty Ltd v Alstom Power Ltd [2009] SASC 377; (2009) 262 ALR 738 [106] ‑ [107].
[124] Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1.
[125] Plaintiffs’ note opposing admission of “without prejudice” letter dated 15 February 2021 filed 5 March 2021 [13].
[126] Heydon JD, Heydon on Contract: The General Part (2019) [9.680].
As part of its use and occupation of the Disputed Land Hungry Jack's kept it clean and tidy and maintained the garden beds (including planting the tree to which I have referred) and maintained the improvements in the manner I have described earlier in these reasons. These activities were not undertaken on a random or ad hoc basis. Rather they were undertaken in a structured way in accordance with the procedures set out in the Hungry Jack's operation manuals. In this respect Hungry Jack's activities were those which an occupying owner would undertake in respect of care and maintenance.
It may be accepted that the construction of the drive‑through and the various improvements undertaken on the Disputed Land before the transfer to Javy on 12 December 1984 are not to be regarded as acts of possession by Hungry Jack's for the purposes of this claim. The improvements were simply features of the land to be taken into account in determining whether Hungry Jack's use and occupation amounted to exclusive possession.
Trustco contended Hungry Jack's possession of the Disputed Land was 'punctured' by the actions of shopping centre staff going onto the Disputed Land to recover trolleys or pick up litter, or chase 'undesirables' away from the shopping centre, and by the presence on the Disputed Land of members of the public who were visiting or shopping at the shopping centre.
The acts of the shopping centre staff must be assessed against the background of the evidence of Mr Davis to which I have referred earlier that the shopping centre management regarded the Northern Retaining Wall as the southern boundary of the shopping centre and that they 'maintained' up to that boundary. The acts relied on by Trustco were far removed from acts of possession in respect of the Disputed Land – they cannot even be characterised as equivocal. Rather they were simply the acts to be expected of those possessing and managing a neighbouring property. They were acts undertaken on an ad hoc basis as part and parcel of the process of operating the shopping centre and for that purpose. They were not undertaken for any purpose related to the use and occupation of the Disputed Land. They were not 'equivalent acts of concurrent possession' in respect of the Disputed Land.[246]
[246] Fowley Marine (Emsworth) Ltd v Gafford [1968] 2 QB 618, 637 ‑ 638 (Willmer LJ).
The presence of members of the public who parked in the Hungry Jack's car park and shopped at the shopping centre or simply crossed the car park and Northern Retaining Wall on their way to and from the shopping centre was a presence permitted by Hungry Jack's as occupier and that presence did not undermine Hungry Jack's possession. The presence on the Hungry Jack's pad site and in particular on the Disputed Land, of members of the public who were not customers of Hungry Jack's and had not caused any difficulty for the operation of the Hungry Jack's, was something tolerated by Hungry Jack's. This, of course, is not surprising given the limited car parking and that the Disputed Land did not form part of a convenient walking route to and from the shopping centre.
Conclusion on factual possession
Trustco contended that the plaintiffs must establish adverse possession 'to a Briginshaw standard apposite to the gravity of displacing a registered proprietor under Torrens title...'.[247] In Cawthorne v Thomas,[248] Bryson J held that a plaintiff claiming adverse possession bears no more than the ordinary standard of proof.[249] On the basis of the facts I have found, however, I am comfortably satisfied (to a Briginshaw standard) that Hungry Jack's exercised a sufficient degree of physical control over the Disputed Land (including the Northern Retaining Wall and northern sliver) for it to have been in possession from 12 December 1984 onwards. This conclusion is founded on my observations about the nature of the Disputed Land and Hungry Jack's use and occupation of it. Expressed compendiously, Hungry Jack's used and occupied the Disputed Land as an occupying owner would have done.
[247] First defendant's proposed findings of fact and holdings of law filed 22 March 2020 [51].
[248] Cawthorne v Thomas (1993) 6 BPR 13,840.
[249] Cawthorne v Thomas, (13,843).
Intention to possess
Summary of the parties' contentions
The parties' contentions as to the intention to possess may be summarised as follows.
The plaintiffs contended the intention to possess is to be inferred from Hungry Jack's factual possession of the Disputed Land which they argue was unequivocal. If, however, any inquiry was required as to the plaintiffs' subjective intention it was to Mr Butler's state of mind that the inquiry should be directed because he was to be regarded as constituting the controlling mind and will of the plaintiffs. Mr Butler, rather than Mr Cowin, was the architect of the system pursuant to which Hungry Jack's occupied restaurants owned or leased by Selden and he managed the system. As described by the plaintiffs (in terms reminiscent of feudal times) Mr Cowin was 'essentially the distanced overlord of the Group'.[250] The plaintiffs contended Mr Butler's subjective intention was that Hungry Jack's should possess the Disputed Land.
[250] Plaintiffs' closing submissions filed 5 March 2021 [51].
Trustco contended that Hungry Jack's use and occupation of the Disputed Land was equivocal and inquiry into the plaintiffs' subjective intention was required. Trustco contended that it was Mr Cowin who was the controlling mind and will of the plaintiffs.
If Hungry Jack's was in possession, Trustco contended that it was in possession with consent that negated the required intention to possess. Trustco contended consent arose in one or more the following ways:
(a)Javy consented to Hungry Jack's using the Disputed Land pending the construction of a crossover from Wiluna Street onto the shopping centre car park via the Disputed Land.
(b)By analogy with the implied licence granted by householders to visitors to use a driveway or path to the entrance of their houses, Javy and its successors in title granted an implied licence to members of the public and Hungry Jack's staff to be on the Disputed Land.
(c)Hungry Jack's believed the Disputed Land was part of the Hungry Jack's restaurant site which it occupied with the consent of the owner of that site.
Intention to possess inferred from possession
In my view Hungry Jack's possession of the Disputed Land pointed unequivocally to an intention to possess such that the intention may be inferred from factual possession.
The conclusion I have reached in respect of the nature of Hungry Jack's possession, and the inference as to intention that may be drawn from it, means it is unnecessary to inquire into Hungry Jack's subjective intention. In my view, however, it is clear that in 1984 Mr Butler was the member of Hungry Jack's management with ultimate responsibility for any issues connected with the land on which the Dog Swamp Hungry Jacks restaurant and drive‑through was conducted and he was the controlling mind of the plaintiffs in respect of those matters. It may be inferred from Mr Butler's letter dated 31 May 1983 to the City of Stirling consenting to the drainage easement sought by the City that his understanding was that the Disputed Land, which was to be the subject of the easement, formed part of the land leased by the Leongs and was used and occupied by Hungry Jack's for the purposes of the drive‑through. There is no evidence to suggest that Mr Butler's understanding changed and the terms of the 2002 Lease suggest that the misapprehension on the part of the plaintiffs as to on the ownership of the Disputed Land persisted.
Hungry Jack's not in possession with Javy's consent pending the construction of a crossover
In the course of my factual findings I have rejected Trustco's contention that in 1984 Hungry Jack's was in possession of the Disputed Land with Javy's consent pending the construction of a crossover between Wiluna Street and the shopping centre car park.
No implied licence
Trustco pleaded that the presence of members of the public on the Disputed Land was pursuant to an implied or tacit licence from Trustco or its predecessors in title and that 'any presence of Hungry Jacks on the disputed land and the northern sliver ... was at all material times subsequent to the Javy Registration Date pursuant to not less than an implied or tacit license from Trustco and its predecessors in title on the same footing as that afforded to members of the public'.[251]
[251] First Defendant’s Third Further Re‑Amended Substituted Defence & Counterclaim filed 9 February 2021 [36(c)].
The implied licence relied on by Trustco was of the nature discussed in the joint judgment of Gibbs CJ, Mason, Wilson and Deane JJ in Halliday v Nevill,[252] in the following terms:
While the question whether an occupier of land has granted a licence to another to enter upon it is essentially a question of fact, there are circumstances in which such a licence will, as a matter of law, be implied unless there is something additional in the objective facts which is capable of founding a conclusion that any such implied or tacit licence was negated or was revoked: cf Edwards v Railway Executive. The most common instance of such an implied licence relates to the means of access, whether path, driveway or both, leading to the entrance of the ordinary suburban dwelling‑house. If the path or driveway leading to the entrance of such a dwelling is left unobstructed and with entrance gate unlocked and there is no notice or other indication that entry by visitors generally or particularly designated visitors is forbidden or unauthorized, the law will imply a licence in favour of any member of the public to go upon the path or driveway to the entrance of the dwelling for the purpose of lawful communication with, or delivery to, any person in the house. (footnotes omitted)
[252] Halliday v Nevill [1984] HCA 80; (1984) 155 CLR 1, 6 ‑7.
I do not accept that an implied licence of the nature discussed in Halliday arose in the circumstances of Hungry Jack's possession of the Disputed Land for the following reasons.
(a)First, the implied licence is limited to entry for a range of specific purposes that correspond with the uses to which the premises to which entry is sought are put. Hungry Jack's used and occupied the Disputed Land for the purposes of its drive‑through restaurant business. It was that business which brought Hungry Jack's customers and Hungry Jack's staff onto the Disputed Land and not any business conducted at the shopping centre. Trustco's answer to this point was to contend that Hungry Jack's did not use the Disputed Land for the purposes of its business. It contended that the business was conducted at the point at which money was exchanged for food which took place at the servery window situated on the Hungry Jack's restaurant site.[253] In my view this analysis was highly artificial and did not reflect the reality that the signs and other improvements on the Disputed Land used by Hungry Jack's, including the drive‑through lane itself, were integral parts of the drive‑through business that could not have operated without the Disputed Land.
(b)Secondly, as the passage from the joint judgment in Halliday makes clear the licence is between the occupier and the putative trespasser and it was Hungry Jack's who was the occupier and not the owner of the shopping centre.
[253] ts 202 ‑ 204.
I add that the concept of consent in adverse possession claims was described by the Court of Appeal in Ben‑Pelech v Royle in the following terms:[254]
Thus, subject to an immaterial exception, where one person enters or occupies land owned by another, the owner's consent to the other's entry or occupation and the accrual of a cause of action in favour of the owner are opposite sides of the same coin. If consent exists there is no cause of action; if consent does not exist, the owner has a cause of action. As Edelman J has observed in the closely related context of trespass, 'consent is the very antithesis of trespass'.
It is only where the true owner knowingly permits the putative adverse possessor to occupy or exercise rights over land the owner knows to belong to him or her, and not to the possessor, that the owner has consented so as to preclude an action for ejectment by the owner. In other words, in this context, knowledge is an element of consent.
(citations omitted)
[254] Ben‑Pelech v Royle [58] – [59] (emphasis added).
In this respect I reject the assertion that Trustco or its predecessors ever consented to the presence of Hungry Jack's on the Disputed Land. There is no evidence that Trustco’s predecessors knew they held paper title to the Disputed Land. Nor is there evidence that Trustco knew it held the paper title to the Disputed Land until after Hungry Jack's claim had accrued.
Intention to possess not negated by Hungry Jack's status as licensee or lessee of Hungry Jack's restaurant site
In support of the contention that any intention to possess was negated by Hungry Jack's belief that the Disputed Land was part of the land it occupied as licensee or lessee, Trustco relied on two first instance decisions of the High Court in England & Wales.
The Trustees of Michael Batt Charitable Trust v Adams,[255] was a case in which a landlord sought to establish adverse possession on the basis that his tenant had been in possession of the claimed land. Laddie J held that the claim failed because the tenant did not have the necessary intention to possess because he believed that he was using and occupying the land with the implied permission of his landlord albeit the landlord was not the true owner.[256]
[255] Trustees of the Michael Batt Charitable Trust v Adams (2001) 82 P&CR 406.
[256] Trustees of Michael Batt Charitable Trust v Adams [27] ‑ [31].
In Clowes Developments (UK) Ltd v Walters,[257] Hart J referred to the example given by Lord Browne‑Wilkinson (cited at [17]) and said:[258]
When, in that passage, Lord Browne‑Wilkinson refers to the possibility of A being there 'as a squatter' he must, I think be using the word 'squatter' to mean someone who is there without the consent of the true owner. It is true that elsewhere in his speech (see in particular Pye paragraph 37 quoted above) he uses that term as potentially including a person who has factual possession as a result of the licence of the true owner. It is, however, in my judgment clear that a person who is in factual possession and who intends to remain in possession (and to use that factual possession for his own benefit) so long as the true owner continues to permit him to do so does not have the necessary intention to possess for the purpose of starting a period of limitation running in his favour. Thus if, in the example, A’s response to an inquiry as to how he happens to be in occupation and control of the locked house is that he is there with the permission of the true owner, it is not open to him to say that by being there he intends to dispossess the true owner. He does not have the necessary intention, and that is so whether or not he is correct in his belief that he does have that permission and whether or not he is correct in his belief as to the identity of the true owner. (emphasis supplied)
[257] Clowes Developments (UK) Ltd v Walters [2005] EWHC 669 (Ch).
[258] Clowes Developments (UK) Ltd v Walters [40].
The authorities concerning adverse possession claims based on factual possession by a tenant and factual possession by a licensee are discussed in Jourdan & Radley‑Gardner's Adverse Possession.[259] The following propositions may be drawn from that discussion:
(a)Adverse possession may be established on the basis of possession by a tenant who believes wrongly that it holds a tenancy of the disputed land. In Tower Hamlets London Borough Council v Barrett,[260] Lord Neuberger said of the claimants in that case:[261]
...[T]hey plainly satisfied the requirement of legal possession i.e. intention to possess. They believed their tenancy included the area. Hence they thought they were enjoying exclusive possession of it – i.e. they not only manifested, but, for what it is worth, they also subjectively had, what Slade J referred to as 'the intention to exclude the world at large' quoted with approval in paragraph 43 of Pye's case.
(b)Although more controversial, a person who believes themselves to have a licence which can be terminated at any time may have an intention to possess. This proposition is supported by appellant authority in Hong Kong, Ho Hang Wan v Ma Ting Cheung,[262] and by first instance judgments in the High Court of England & Wales, Wretham v Ross,[263] (in which David Richards J held that a mistaken belief on the part of the claimant that he had the owner's permission to possess a stable was an insufficient basis to conclude that he did not have the requisite intention to possess), and J Alston & Sons Ltd v BOCM Pauls Ltd.[264]
[259] Jourdan S QC and Radley‑Gardner O, Adverse Possession (2nd ed, 2011) [9.44] ‑ [9.56]; see also Butt P, Land Law (6th ed, 2010) [22.14].
[260] Tower Hamlets London Borough Council v Barrett [2006] P&CR 132 [42].
[261] Tower Hamlets London Borough Council v Barrett [42], see also Ofulue v Bossert [2009] Ch 1 [63] (Arden LJ).
[262] Ho Hang Wan v Ma Ting Cheung (1990) 1 HKLR 649.
[263] Wretham v Ross [2005] EWHC 1259 (Ch) [41].
[264] J Alston & Sons Ltd v BOCM Pauls Ltd [2008] EWHC 3310 (Ch).
In J Alston & Sons Ltd v BOCM Pauls Ltd,[265] HHJ Marshall QC sitting as a Deputy High Court Judge held a claimant who farmed agricultural land knowing that he had a licence from previous owners but did not know what had happened thereafter had the necessary intention to possess. Her Honour gave detailed consideration to the decisions in Batt, Clowes and Wretham.[266] Her Honour preferred the decision in Wretham reasoning that Batt was decided before Pye and was affected by the connotations of the word 'adverse' which Lord Browne‑Wilkinson had deprecated in Pye which led to an erroneous approach to the concept of 'possession'.[267] Her Honour rejected the argument that there had to be an intention to 'infringe the rights of the true owner' on the basis that the argument seemed to reintroduce the connotations of conflict attaching to the label 'adverse possession' and preferred the approach of David Richards J in Wretham on the basis that accorded more closely with the judgments in Pye.[268]
[265] J Alston & Sons Ltd v BOCM Pauls Ltd [86] and [105].
[266] J Alston & Sons Ltd v BOCM Pauls Ltd [86] ‑ [104].
[267] J Alston & Sons Ltd v BOCM Pauls Ltd [95].
[268] J Alston & Sons Ltd v BOCM Pauls Ltd [99] ‑ [100].
In Adverse Possession Jourdan and Radley‑Gardner express the view that (in England & Wales) it is settled at any level below the Court of Appeal that a person who wrongly believes that they have, or may have, the owner's permission to use the property can have the requisite intention to possess and the decisions in J Alston & Sons Ltd and Wretham are to be preferred over the decisions going the other way on the following basis:[269]
A person who intends to exercise exclusive control over property, for his own benefit, for the time being, does have the intention to possess, and is in possession. The fact that he believes that he has the owner's permission, when in reality he does not have such permission, does not prevent him from being in possession. If he did, in reality, have such permission, then the permission would have the effect of making his possession vicarious, on behalf of the true owner . .. However, if there is no such permission, then there is no basis for treating the possession as vicarious. It is clearly established that a person who wrongly believes themselves to be a tenant does have the intention to possess ... There is no practical difference between the intention of a tenant holding under a tenancy which can be determined at any time by notice from the landlord and a licensee entitled to exclusive possession. Both intend to possess for the time being for their own benefit, and both know that they may be required to vacate at any time. (footnotes omitted)
[269] Jourdan S QC and Radley‑Gardner O, Adverse Possession (2nd ed, 2011) [9.51].
In Sunny Corporation Pty Ltd v Elkayess Nominees Pty Ltd,[270] Bongiorno J upheld a claim for adverse possession by the defendant company whose director erroneously believed the defendant to have leased the claimed land when the evidence established that the defendant held neither a lease nor a licence over the claimed land – he held a grazing licence over adjoining land.[271] Bongiorno J referred to the decision of Brooking JA in Malter v Procopets,[272] in which Brooking JA had held that a land owner's mistaken belief that he was the true owner of a strip of land actually owned by his neighbour did not prevent the acquisition of title by adverse possession. Bongiorno J held:[273]
What is necessary to the formation of an animus possidendi, as the Latin phrase implies, is an intention to possess. In Malter the claimant intended to possess the disputed land because he erroneously thought he was the fee simple owner as that land was included within his title. In this case Mr Kelly intended to possess the disputed land because he thought he was the lessee under a lease. In each case the claimant had an intention to possess... The error in Mr Kelly’s belief is irrelevant. What is important is that he had the requisite intention to possess. He excluded the true owner without knowing he was the true owner just as the claimant did in Malter.
[270] Sunny Corporation Pty Ltd v Elkayess Nominees Pty Ltd [2006] VSC 314.
[271] Sunny Corporation Pty Ltd v Elkayess Nominees Pty Ltd [12] ‑ [13].
[272] Malter v Procopets [2000] VSCA 11.
[273] Sunny Corporation Pty Ltd v Elkayess Nominees Pty Ltd [51] ‑ [52].
Hungry Jack's was in factual possession of the Disputed Land. Its intention was to use the Disputed Land as its own in the manner an occupying owner would have done. As I have found Hungry Jack's believed the Disputed Land formed part of the Hungry Jack's restaurant site, which in 1984 was leased by Selden, and from 1988 to 2002 was owned by Selden. Thereafter, Hungry Jack's believed the Disputed Land was part of the land the subject of the 2002 lease. Hungry Jack's mistaken belief is irrelevant. What is relevant is that Hungry Jack's was not in possession of the Disputed Land with the consent of the owner of the paper title of the Disputed Land at anytime. When Westpac owned both the Hungry Jack's restaurant site and the Disputed Land, Hungry Jack's only had Westpac's consent to possession of the Hungry Jack's restaurant site and not the Disputed Land.
Payment of rates by Trustco and predecessors in title did not negate intention to possess
As recorded earlier Trustco and its predecessors in title paid the rates and statutory charges in respect of the Disputed Land. The payment of rates by the owner of the paper title is not fatal to a claim for adverse possession though payment of rates by a claimant may strengthen the claim.[274] In my view the fact that the rates in respect of the Disputed Land were paid by the paper owner did not undermine Hungry Jack's intention to possess.
The franchise agreements
[274] Shaw v Garbutt (1996) 7 BPR 14,816, 14,833‑4 (Young J); Refina Pty Ltd v Binnie [2009] NSWSC 914 [25] (Brereton J).
Trustco pleaded that Hungry Jack's did not have an intention to possess the Disputed Land because Hungry Jack's presence on the Disputed Land was in accordance with the terms of the franchise agreements that governed the operation of the restaurant.[275] In closing submissions nothing was said in support of this aspect of Trustco's pleaded case. That Hungry Jack's owed obligations to its franchisor as to the operation of the restaurant, which affected how it could use the Disputed Land, did not negate its intention to possess.
Conclusion on intention to possess
[275] First Defendant's Third Further Re-Amended Substituted Defence & Counterclaim filed 9 February 2021[99B] - [99E].
The reasons set out in the preceding paragraphs lead to the conclusion that Hungry Jack's had an intention to possess the Disputed Land from 12 December 1984 which was not negated by any of the matters relied on by Trustco.
Legal possession established
Hungry Jack's was in factual possession of the Disputed Land with the intention to possess from December 1984. The plaintiffs divided the period of Hungry Jack's possession into different 'claim periods' to account for changes in ownership of the Hungry Jack's restaurant site. The primary claim period was December 1984 to December 1996 and the alternative period was 9 July 2002 to 9 July 2014. In my view possessory title of the Disputed Land accrued in December 1996, if, however, the period prior to the execution of the transfer of the Hungry Jack's restaurant site to Westpac were to be disregarded for some reason, possessory title accrued by 9 July 2014.
The effect of the accrual of possessory title in 1996 was to deprive the holder of the paper title (Sangora Holdings Pty Ltd) of its title and either Hungry Jack's or Selden acquired it.
There is a rebuttable presumption that a tenant who has encroached on the land of a third party and established adverse possession holds the additional land as if it were a part of the tenancy.[276] Although I concluded that Hungry Jack's did not occupy the Hungry Jack's restaurant site under the terms of a lease or tenancy with Selden the agreement between them to the effect that Hungry Jack's acquired the possessory title on behalf of Selden reflects the rebuttable presumption that would have applied if there had been a tenancy. I have already noted that the second defendants advance no claim to the Disputed Land. I hold that possessory title of the Disputed Land is vested in Selden.
[276] Tower Hamlets London Borough Council v Barrett [26] ‑ [30].
The statutory scheme and subdivision of the shopping centre land
The Transfer of Land Act 1893 (WA) provides a procedure whereby a person claiming possessory title to land may apply to the Commissioner of Titles to be registered as the proprietor of the land, s 222 and s 223. Among other things the procedure requires such an application to be advertised in a newspaper. Section 223A of the Transfer of Land Act provides that a person claiming an estate or interest in the land the subject of an application may lodge a caveat forbidding the grant of the application.
Trustco contended that these provisions 'at least qualify the relief that any plaintiff can seek ...'.[277] The gravamen of Trustco's pleaded case was that the declaratory relief should not be granted by this court because no application had been made by the plaintiffs under s 222 of the Transfer of Land Act.[278] Trustco contended that the proceeding before this court would adjudicate the rights as between the parties but 'could [not] give rise to relief as against the world, including any predecessor in title who may seek to be heard as to a competing right including, for example, Westpac, Foodland, Sangora, Forrester and Javy'.[279]
[277] First defendant's proposed findings of fact and holdings of law filed 22 March 2020 [108].
[278] First defendant's third further re‑amended substituted defence and counterclaim filed 9 February 2021 [103].
[279] First defendant's proposed findings of fact and holdings of law filed 22 March 2020 [109].
Trustco's contention as to the operation of the statutory provisions was novel. It was not supported by any authority. Nor is the contention supported by s 222 of the Transfer of Land Act which is expressed in permissive terms, 'Any person claiming to have acquired under or by virtue of any statute of limitations an estate in fee simple in possession . . . may make application . . .'. There is nothing to suggest the statutory provisions confine the jurisdiction of this court. Further, there is no evidentiary or legal basis for the suggestion implicit in Trustco's contention that any of its predecessors in title have any interest in the outcome of this action.
I do not accept that the power of the court to grant declaratory relief to the effect that any title of Trustco to the Disputed Land has been extinguished by adverse possession by Hungry Jack's and that Selden is the proprietor in respect of the Disputed Land of an estate in fee simple in possession is constrained by the provisions of the Transfer of Land Act nor do I consider that the discretion is limited in the manner contended for by Trustco. I have reservations, however, about whether it is appropriate for the court to make a declaration in respect of the decision to be made by the Commissioner under s 222 of the Transfer of Land Act. This is essentially an administrative process which should be allowed to take its course in the usual way.
Trustco contended that 'the precise result which a finding of adverse possessory title is not certain. Subdivision of Lot 18 to detach the Disputed Land (with or without the Northern Sliver) may not be possible under existing subdivision requirements'.[280] Trustco pleaded that, by reference to various provisions of the Planning and Development Act 2005 (WA) and City of Stirling Local Planning Scheme No 3, approval to subdivide Lot 18 to create a new lot being the Disputed Land would not, or ought not, be granted and therefore the plaintiffs' claimed relief should be denied.[281]
[280] First defendant's proposed findings of fact and holdings of law filed 22 March 2020 [110].
[281] First defendant's third further re‑amended substituted defence and counterclaim filed 9 February 2021 [104] ‑ [105].
The proposition that the acquisition of possessory title is in some way dependent on the potential sub‑divisibility of the claimed land is not supported by authority. I do not accept Trustco's contention that the difficulties identified in its pleading constitute a bar to the relief claimed by the plaintiffs.
Relief and costs
I will hear the parties as to the terms of relief and costs.
Appendix
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
AS
Associate to the Honourable Justice Tottle
20 JULY 2021
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