Laming v Jennings

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S APCI 2018 0021

JAMES LAMING	Applicant
v
MARTIN GLENN JENNINGS	Respondent

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JUDGES:	KYROU, McLEISH and NIALL JJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	8 August 2018
DATE OF JUDGMENT:	7 December 2018
MEDIUM NEUTRAL CITATION:	[2018] VSCA 335
JUDGMENT APPEALED FROM:	Laming v Jennings [2017] VCC 1223 (Judge Cosgrave) Laming v Jennings [2017] VCC 1932 (Judge Cosgrave)

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REAL PROPERTY – Easements – Easement by prescription arising from doctrine of lost modern grant – Knowledge of owner of servient tenement of acts of user – Actual and constructive knowledge – Where knowledge of agent binds owner – Presumption of knowledge of open user – Where certain acts of user transient and sporadic – Where state of land would not put reasonable, diligent owner on inquiry – Appeal allowed – Pugh v Savage [1970] 2 QB 373; Diment v NH Foot Ltd [1974] 1 WLR 1427; Sunshine Retail Investments Pty Ltd v Wulff [1999] VSC 415 considered.

REAL PROPERTY – Easements – Nature and scope of easement – Validity of easement for recreation, storage of firewood and burning of green waste – Where land is part of private land holding – Re Ellenborough Park [1956] Ch 131; Jackson v Mulvaney [2003] 1 WLR 360 distinguished.

REAL PROPERTY – Easements – Nature and scope of easement – Easement for recreation, storage of firewood and burning of green waste – Whether easement amounts to joint possession of land.

REAL PROPERTY – Easements – Easement by prescription arising from doctrine of lost modern grant – Whether owner of servient tenement bound by acquiescence of predecessors in title – Transfer of Land Act 1958 s 42(2)(d).

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APPEARANCES:	Counsel	Solicitors
For the Applicant	Mr M J Colbran QC with Mr G D Bloch	Tisher Liner FC Law
For the Respondent	Mr R Hay QC with Mr K E Mihaly	Megan Copas

KYROU JA
McLEISH JA
NIALL JA:

Introduction and summary................................................................................................................ 1
The County Court proceeding............................................................................................................ 3
The judge’s reasons.............................................................................................................................. 3

The disputed land................................................................................................................................ 4
Use of the disputed land...................................................................................................................... 5
The adverse possession claim............................................................................................................... 9
The claim for an easement................................................................................................................. 10

The judge’s further reasons............................................................................................................... 15
The orders........................................................................................................................................... 18
The proposed grounds of appeal..................................................................................................... 19
Ground 1 — knowledge.................................................................................................................... 19

The parties’ submissions.................................................................................................................... 19
Relevant principles............................................................................................................................ 21
Consideration.................................................................................................................................... 28

Ground 2 — the easement is too broad.......................................................................................... 32

The parties’ submissions.................................................................................................................... 32
The easement as found....................................................................................................................... 33
Re Ellenborough Park....................................................................................................................... 35
Mulvaney.......................................................................................................................................... 36
Australian authorities....................................................................................................................... 39
Consideration.................................................................................................................................... 39

Ground 3 — the easement amounts to a right to possession...................................................... 44

Consideration.................................................................................................................................... 46

Ground 4 — s 42(2)(d) of the TLA................................................................................................... 48

Consideration.................................................................................................................................... 50

Conclusion.......................................................................................................................................... 55

Introduction and summary

This is an application for leave to appeal from a declaration and other orders made by a judge of the County Court upholding a claim for an easement for recreation over land in Ferny Creek, Victoria. The disputed land over which the easement was granted forms part of a larger parcel of land owned by the applicant, Mr Laming. The respondent had claimed adverse possession of the land, or alternatively an easement over the land.

The judge found that the respondent and his family (the Jennings), and their predecessors in title, the Howards, had made extensive use of the disputed land as their backyard, including by mowing and maintaining the grass to create a lawn, removing and planting trees, playing games, using garden furniture, and erecting a clothesline.

Notwithstanding the findings as to use of the disputed land by the Howards and the Jennings, the judge found that they were never in possession of the land. He also found that both the Howards and the Jennings had offered to acquire the land from its then owner, Telstra Corporation Ltd (‘Telstra’), which constituted an acknowledgment of the owner’s title. Based on those facts, the judge held that the respondent’s claim for adverse possession failed.

However, the judge held that the acts of the Howards and the Jennings constituted an open user of the disputed land to the knowledge of the owner which gave rise to an easement over part of the disputed land in favour of the land owned by the Jennings. The form of the easement, as declared by the judge, was an easement ‘for the purposes of recreation. The permitted usage includes burning green waste and storing domestic firewood’.

The applicant seeks to overturn the declaration made by the judge, advancing four proposed grounds concerning:

(a) the judge’s finding that Telstra had knowledge of user by the Howards and the Jennings;

(b) whether the easement found by the judge is recognised at law;

(c) whether the easement is unworkable due to inconsistency with the applicant’s rights as owner of the land; and

(d) the operation of s 42(2)(d) of the Transfer of Land Act 1958 (‘TLA’) in respect of user falling short of an easement by prescription at the time of registration.

The proposed grounds themselves are set out at [68] below. For the reasons that follow, we would uphold the first and second proposed grounds and reject the third. We would not decide the fourth proposed ground. To that end, we would grant leave to appeal and allow the appeal.

The County Court proceeding

In late 2015, the respondent made a claim to the disputed land. In response, the applicant commenced a proceeding in the County Court seeking:

(e) a declaration that he was entitled to possession of the whole of his land;

(f) alternatively, a declaration that the respondent had trespassed on the land;

(g) damages;

(h) an order that he was entitled to remove and dispose of the respondent’s chattels and fixtures placed on the land; and

(i) alternatively, an order that the fruit trees and clothesline situated on the land belonged to him.

By amended defence and counterclaim, the respondent contended that he and his predecessors in title had been in possession of the disputed land for a period exceeding 15 years and had therefore acquired title to that land or, alternatively, that he had the benefit of an easement over the disputed land arising by the doctrine of lost modern grant. He sought a declaration of title to the disputed land or, alternatively, a declaration that he had the benefit of an easement over the disputed land.

The judge’s reasons

The judge’s reasons for judgment[1] are structured by reference to an agreed set of issues that covered both the adverse possession claim and the alternative claim for an easement.[2] Given that the proposed grounds of appeal attack the factual foundations of the judge’s reasoning and conclusions reached by him, it is necessary to set out the judge’s findings in some detail.
[1]Laming v Jennings [2017] VCC 1223 (‘Reasons’).
[2]Reasons [20].

The disputed land

The respondent owns 2 Merimbula Road, Ferny Creek (‘Jennings land’). The property is close to trapezoidal in shape and covers an area of about 1,700 square metres. The respondent acquired the property on 7 July 2008 from Wendy and Glenn Howard who had been the registered proprietors since 19 September 1986.

The rear boundary of the Jennings land adjoins 4 One Tree Hill Road, which is a larger, irregular-shaped block owned by the applicant (‘Laming land’). The Laming land is approximately 16,000 square metres.

The Laming land was created in 2012 from a subdivision of a larger block that had originally been owned by the Commonwealth and, from 1991, the entity now known as Telstra (‘Telstra land’). The Telstra land was approximately 15 acres (or 60,000 square metres) and contained two telephone towers.

Telstra’s ownership of the Telstra land is complicated by the fact that, in 1997, Norman and Susan Brodie became the registered proprietors of the Telstra land and two nearby blocks that had also been owned by Telstra (all as part of the same title). One of those blocks, now known as 2A Merimbula Road, was transferred back to Telstra in 1998. The Telstra land was transferred back to Telstra in 2000. The relevant instruments of transfer recorded that no consideration was payable because it was a ‘correction of an error’. The Brodies remained the registered proprietors of the block now known as 5A Merimbula Road.

After the Laming land was first registered in February 2012, it was acquired by One Tree Hill Pty Ltd. The applicant acquired the land from One Tree Hill Pty Ltd on 21 September 2015.

The disputed land, marked yellow on the plan attached to the judge’s reasons as Annexure 1 (and reproduced as attachment 1 to these reasons), is a roughly rectangular area of land at the north-west corner of the Laming land. The area of the disputed land (approximately 1,400 square metres) is only a little bit smaller than the Jennings land.

Use of the disputed land

Both the adverse possession claim and the claim for an easement relied on long user of the disputed land first by the Howards and then by the Jennings.

The Howards acquired the Jennings land in September 1986. At that time, the Telstra land was owned by the Australian Telecommunications Commission. Mr Howard gave evidence that, at an inspection prior to purchase, he observed that the Telstra land contained gum trees and blackwood trees and a line of cotoneaster trees along the boundary between the Telstra land and the Jennings land. He also observed that at the intersection of the Jennings land, the adjacent block (2A Merimbula Road) and the Telstra land, there was thick vegetation and that the Telstra land was generally taken up with trees, scrubby areas and grassy areas.[3]
[3]Reasons [26].

Within two years of purchase, the Howards cut down the cotoneaster trees along the boundary between the two properties. This revealed a concrete and wire fence along the boundary. Mr Howard substantially removed the fence as part of his tidying work, but left a few of the concrete posts in place. Shrubs and trees were cut back to be clear of the Howards’ house and blackberries and other plants were removed.[4]
[4]Reasons [27]–[28].

Part of the Telstra land near the house was mowed by the Howards in order to ‘create a backyard area which [they] could use’.[5] The Telstra land sloped down towards the Jennings land and this was addressed by the Howards in a couple of ways. The Howards built steps from their property up towards the Telstra land and a dry rock wall along the rear of their land. A drainage ditch was also installed to reduce the flow of run-off water from the Telstra land.[6]
[5]Reasons [29].
[6]Reasons [30].

For two or three years after the Howards moved in, Telstra[7] cut the grass along a narrow strip along the rear boundary of the Telstra land. Mr Howard gave evidence that, over time, the Telstra person cut only to the point where Mr Howard had stopped mowing. Mr Howard never saw the Telstra person drive over that part of the Telstra land which he (Mr Howard) had mowed.[8]
[7]Strictly, its predecessor the Australian Telecommunications Commission.
[8]Reasons [31]–[33].

The ‘backyard’ (that is, the disputed land) was maintained by the Howards by mowing the grass and keeping the area free of debris such as fallen branches and the like.[9] In 1986 (or early 1987), the Howards planted a lemon tree on the land. They planted a weeping cherry in the late 1990s, two plum trees in the mid-1990s, a pine tree in about 1993, and a magnolia tree sometime in the 1990s. These trees were pruned and cared for by Mrs Howard and plums and lemons from the trees were used in cooking.[10]
[9]Reasons [34]–[35].
[10]Reasons [36].

The Howards also used the ‘backyard’ for the purposes of burning green waste, storing firewood, and recreational activities. The Howards installed a clothesline some time between 2000 and 2005.[11]
[11]Reasons [37].

The recreational activities that took place in the ‘backyard’ included the playing of sports on a frequent basis.[12] The ‘backyard’ was also used for social occasions, including birthday parties for the children, hosting Christmas on five or six occasions, and other social gatherings. The Howards placed a picnic table on the disputed land and used this as an eating area.[13]
[12]Reasons [38].
[13]Reasons [39].

Based on that evidence, the judge was satisfied that the Howards made extensive use of the disputed land, or parts of it, over many years commencing in 1986.[14]
[14]Reasons [40].

As noted above, the respondent acquired the Jennings land in July 2008. The respondent had a ride-on mower and regularly mowed the grass on the disputed land. He engaged in extensive maintenance and gardening and, shortly after moving in, transplanted a lemon tree from his front yard onto the disputed land. He removed at least five trees and planted two snow gums and three or four tea trees.[15]
[15]Reasons [43].

The judge found that the respondent undertook substantial work clearing out the garden and that he did a lot of garden clearing for fire risk mitigation. The respondent estimated that he burnt off waste in a fire pit on the disputed land about 20 times a year in those years he did a lot of clearing and, in less busy years, about 10 times. The Jennings used the clothesline, stored firewood on the disputed land, and used that land for a variety of recreational activities.[16]
[16]Reasons [44].

The judge was satisfied that the Jennings had made substantial use of the disputed land since they moved in.[17]
[17]Reasons [45].

The judge heard evidence from a variety of witnesses who lived in the area, including Barbara Rose, Anna-Marie Shew, Susan Coad, Sarah Krumins and Helen McGie. These witnesses described using the Telstra land and, on occasion, the disputed land.

The judge also considered the use of the disputed land by Telstra, the registered proprietor. Telstra was largely an absent owner. Its principal use of the Telstra land was as the location for telecommunications facilities, including the telephone towers and ancillary services.[18]
[18]Reasons [46].

At some point, Telstra subcontracted general maintenance services and engaged Broadspectrum Pty Ltd (earlier known as Transfield Services Pty Ltd) to perform maintenance work, which largely comprised slashing of grass approximately twice a year.[19]
[19]Reasons [46].

The judge recorded his findings in relation to the use made of the disputed land in these terms:

·The Howards extensively used the Telstra Property where it abutted their house from late 1986 until they sold in 2008. They cleared trees and undergrowth from the boundary area between the two properties. They mowed an area of grass and used it consistently with their view that it was their backyard. They planted trees. The Howards and their children used the area to play, to relax in and to entertain.
·Once they bought the Howards’ property, the Jennings family made similar use of the Telstra Property abutting the house. Using his ride-on mower, Jennings extended the mown area so it became larger than when the Howards lived at Merimbula Road. The Jennings planted more trees and made greater use of the clothesline than their predecessors. The Jennings family used the Disputed Land to play, to relax in and for entertaining.
·None of Mrs Rose, Mrs Shew, Mrs Coad or Mrs Krumins said that they walked on the Telstra property after obtaining consent or approval from Telstra. If they walked on the Disputed Land, they did not seek permission from the Howards or Jennings. Neither the Howards nor Jennings ever told any of these people not to walk on the Disputed Land or sought to warn them off (although Jennings refused Mrs Rose permission to walk from the Telstra Property through his land to her house).
·The consensus among virtually all the witnesses was that there was a notable demarcation between the mown grass in the disputed area and the slashed grass on the Telstra Property. The mown grass was always shorter and cut more frequently than the grass on the Telstra Property.
·The Howards and Jennings have not been present to see third parties walking on the Disputed Land. However, the camera installed by Jennings has photographed persons on or in the vicinity of the Disputed Land.
·The Howards and Jennings did not attempt to fence off or otherwise separate the Disputed Land from the Telstra Property. Nor did they place any warning signs on the land directing people not to walk on the Disputed Land. Notwithstanding this, walkers on the Telstra Property like Mrs Rose appreciated that the mown area comprising the Disputed Land was treated differently from the balance of the Telstra Property. Mrs Rose chose not to walk on the Disputed Land between the line constituted by the clothesline and trees planted by the Howards, and the rear of the house at 2 Merimbula Road. Mrs McGie said she thought of the fruit trees as belonging to Wendy Howard and Mrs Howard would make jam from their fruit.[20]

[20]Reasons [106] (citations omitted).

The judge noted that Telstra had arranged for various surveys and valuation work to be conducted in relation to the Telstra land. The following facts were agreed between the parties:

(j) on 16 January 1995, Telstra, or its contractors, undertook a survey of the boundaries of the Laming land and the land now known as 2A Merimbula Road;

(k) on 29 July 1997, Keith Jones, on behalf of Telstra, undertook a survey of the boundaries of the land now known as 2A Merimbula Road and placed survey pegs on parts of the boundary of the land; and

(l) on 29 February 2008, Gary Waite, on behalf of Telstra, undertook a survey of the boundaries of the Laming land and marked the concrete fence posts on the boundary of the disputed land as survey marks.[21]

[21]Reasons [172].

The adverse possession claim

The claim for adverse possession of the disputed land failed before the judge and there is no cross-appeal from that finding. However, it is useful to briefly describe the judge’s findings in relation to the adverse possession claim given they were also relevant to the alternative claim for an easement.

The judge found the adverse possession claim failed because both the Howards and the Jennings had offered to purchase parts of the Telstra land that included the disputed land (or part of it). This constituted an acknowledgement of the registered proprietor’s title to the land.[22]
[22]Reasons [141].

The judge concluded that neither the Howards nor the Jennings were in possession of the disputed land or any part of it.[23] His Honour found that they did not seek to assert or maintain exclusive possession and control as against Telstra or any third party, they took no steps to enclose the land or erect signs claiming possession, and they took steps to acquire the property from Telstra. The judge also relied on the fact that, at the time they sold the property, the Howards had explained the correct title boundaries to the estate agent and the details on the sale brochure corresponded with the paper title. The judge concluded that the acts relied on by the respondent were too equivocal to constitute possession and that the offers to purchase the land reflected the lack of the necessary intention to possess.[24]
[23]Reasons [165].
[24]Reasons [165]–[169].

The claim for an easement

The respondent’s alternative claim was for an easement arising from the doctrine of lost modern grant.

The judge set out the requirements for a valid easement as follows:

(m) there must be a dominant and servient tenement;

(n) the easement must accommodate the dominant tenement;

(o) the owners of the dominant and servient tenements must be different from each other; and

(p) the right or claim must be capable of being the subject matter of a grant.[25]

[25]Reasons [188].

The judge found that each of those matters was satisfied.[26] The second and fourth elements remain contentious on the application for leave to appeal and it is necessary to refer to the judge’s reasoning in respect of those elements.
[26]Reasons [189]–[190].

As to the second element, the judge concluded that the easement accommodated the dominant tenement in the sense that it benefited the dominant tenement and was not merely personal to the owner. There was a natural connection between the two tenements, and the easement was reasonably necessary for the enjoyment of the dominant tenement and therefore accommodated that tenement. In that regard, his Honour referred to the fact that the Jennings land has only a small backyard, with the house situated very close to the rear boundary.[27]
[27]Reasons [190].

In relation to the fourth element, the judge concluded that an easement for recreation is one capable of being made by grant. His Honour referred to Re Ellenborough Park[28] and Riley v Penttila[29] as establishing that the use of land as a pleasure ground, for the purposes of recreation, or as a garden or a park may qualify as an easement.[30]
[28][1956] Ch 131.
[29][1974] VR 547.
[30]Reasons [189].

As noted above, the claim was for an easement by prescription. The judge identified the matters that are necessary to create an easement by prescription[31] by reference to the decision of Hedigan J in Sunshine Retail Investments Pty Ltd v Wulff.[32] In Sunshine Investments, Hedigan J identified the relevant elements as follows:
[31]Reasons [191].
[32][1999] VSC 415 (‘Sunshine Investments’).

(q) the doing of an act by a person or persons upon the land of another;

(r) the absence of right to do that act in the person doing it;

(s) the knowledge of the person affected by it that the act is done;

(t) the power of the person affected by the act to prevent it, either by an act on his or her own part or by action in the courts;

(u) the abstinence by that person from interference for such a length of time as renders it reasonable for the court to say that the court shall not afterwards interfere to stop the act being done.[33]

[33]Ibid [76].

The judge recognised that knowledge of the servient owner of the use of the land in dispute is one of the essential elements underlying the doctrine of lost modern grant.[34]
[34]Reasons [212].

In considering the state of knowledge of Telstra, the judge included actual knowledge, derived from what its employees observed, and a form of constructive knowledge, being what a diligent owner, acting to protect its own interests, would have known given the means of knowledge available to it. Relevant to that question was whether there were physical or other clear signs of use on the land that would have been observable to an owner acting diligently.

In taking that approach, the judge referred to Gangemi v Watson[35] in which the Full Court of the Supreme Court of Western Australia held that the servient owners had constructive knowledge of user.[36] The Court there found that the servient owners, despite being unaware that they owned the land, technically had possession and was therefore under a duty to act diligently to protect their interest and that they had ‘means of knowledge’ by reason of the presence of physical signs of use.[37] The judge remarked that there were some parallels between Gangemi and the dispute before him because, in both cases, the servient owner could have seen clear evidence of user ‘if he or she had acted diligently to protect his or her interest in the land and had actually inspected it’.[38]
[35](1994) 11 WAR 505 (‘Gangemi’).
[36]Reasons [219]–[220].
[37]Gangemi (1994) 11 WAR 505, 515 (Seaman J, with whom Ipp and Wallwork JJ agreed).
[38]Reasons [221].

In this respect, the judge distinguished Sunshine Investments in which Hedigan J held there was nothing to put the owner on inquiry because the use of the land as a right of way left no indicia of use such as gates or wheel tracks.[39] The judge found that, in this case, there were clear differences in the land (such as the mown grass, planted trees and clothesline) that reflected use and would have put a diligent owner on notice.[40]
[39]Reasons [224]–[230], citing Sunshine Investments [1999] VSC 415 [111].
[40]Reasons [230].

The judge also referred to the onus of proof in relation to the elements of a prescriptive easement, including knowledge. The judge observed that Nelson v Hughes[41] ‘appear[s] to be authority’ for the proposition that, once the claimant has shown an obvious, open user of the disputed land, there is an evidentiary onus upon the servient owner to prove a lack of knowledge.[42] The judge concluded that, if there was such a presumption in favour of the respondent as claimant, the applicant had not rebutted that presumption. However, he went on to note that, even if the onus remained on the respondent to establish knowledge, he had proved that part of his case.[43]
[41][1947] VLR 227, cited in Sunshine Investments [1999] VSC 415 [124].
[42]Reasons [234].
[43]Reasons [235].

The judge observed that Telstra could not use its size as an excuse to say it did not know what was happening on the Telstra land.[44] Although the judge accepted that the written records available to Telstra did not reveal any knowledge on its part of anyone occupying or using part of the Telstra land,[45] he concluded that ‘Telstra knew or should have known that the Disputed Land (or part thereof) was being used by third parties in a way which made it quite different from the rest of the Telstra Property.’[46]
[44]Reasons [235].
[45]Reasons [233].
[46]Reasons [233].

The judge noted that, at least from late 1986 or 1989, a Commonwealth employee cut the grass and possibly carried out other maintenance on the Telstra land. The judge noted that ‘the evidence was overwhelming that the grass in the Disputed Land was mown short like a backyard, whereas the grass on the balance of the Telstra Property was always longer.’[47] It followed that a Telstra employee ‘must have seen that its appearance was different from the rest of the grassy areas on the Telstra property.’[48]
[47]Reasons [235].
[48]Reasons [235].

The judge also referred to evidence that, during the period in which the Howards and the Jennings lived on the Jennings land, employees of the Commonwealth and, after 1991, employees of Telstra attended at the Telstra land to perform work on the communications facilities located there. The judge also referred to the evidence of a Telstra employee, Mr Knight, who lived at 7 Merimbula Road and whose job included maintenance work at a tower on the Telstra land. He gave evidence that he had asked Mr Howard not to burn off when the wind was blowing towards the towers because it would set off an alarm.[49]
[49]Reasons [233].

An additional basis for Telstra’s knowledge was that a Telstra employee had tested for radiation along the boundary fence line of the Telstra land. Two witnesses gave evidence that they had seen this occurring in the late 1990s or early 2000s in the vicinity of the Jennings land. The judge said that one might reasonably infer that such testing occurred on a regular basis but that, regardless of that fact, any employee conducting testing during the late 1990s or early 2000s ‘would or should have noticed the difference in the appearance of the grassy areas within the Disputed Land and the Telstra Property more generally.’[50]
[50]Reasons [236].

The judge concluded that the respondent had not established a claim for adverse possession, but had proved an easement over part of the disputed land.[51] His Honour also upheld a claim of trespass against the respondent on the basis that he, and his predecessors in title, were present on the disputed land beyond the easement as found. The judge awarded nominal damages of $1.[52]
[51]Reasons [256].
[52]Reasons [255].

The judge invited the parties to make submissions on the final form of order and on the question of costs.

The judge’s further reasons

On 19 December 2017, the judge made orders and published reasons relating to the form of those orders.[53]
[53]Laming v Jennings [No 2] [2017] VCC 1932 (‘Further Reasons’).

The judge set out the submissions of the parties on the form of the easement. His Honour noted that the applicant had not sought to make any submissions about the form of declaration sought by the respondent in relation to the easement. He had, however, made some general submissions objecting to any order allowing the respondent to store fixtures, chattels or wood on the disputed land, on the basis that this would impinge unduly upon his possession and enjoyment of the land. He also objected to the respondent burning off on the disputed land and said that the use of the easement should not extend to invitees.[54]
[54]Further Reasons [32].

In dealing with the competing claims, the judge identified the essence of the claim to an easement as being that, over a period of more than 20 years, the Howards and then the Jennings had used part of the disputed land as their backyard. The judge said:

This usage entailed the varied sorts of activities which commonly occur in the backyard of the family home. The families maintained the area like a garden area by cutting the grass and clearing and burning green waste; they planted and maintained trees; they played games and engaged in different forms of recreational activity such as sports and having a coffee while reading; they entertained family, friends and neighbours.[55]

[55]Further Reasons [33].

The judge went on to observe that the burning of green waste and the storage of firewood was not unusual in the area.[56]
[56]Further Reasons [34].

The judge noted that the prayer for relief claimed an easement for recreational use but that he regarded that as ‘a general description designed to cover the use which the Howards and Jennings made of the Disputed Land (or part thereof) in and after 1986.‘[57] The judge then dealt with two specific aspects of the proposed easement: the burning of vegetation and the keeping of fixtures and storing of firewood on the disputed land.
[57]Further Reasons [35].

In respect of those matters, the judge concluded that the easement should not restrict the respondent burning green waste as that had occurred since he had moved in.[58] His Honour explained that, because it was past usage which gave rise to the easement:

it seems to me that the owner of the dominant tenement should be able to continue using the servient tenement affected by the easement in the same way as previously. Hence, if this is correct, the activities contemplated by the easement include burning green waste and playing on part of the Disputed Land, not only with immediate family members but also with less immediate family and third parties invited to the property.[59]

[58]Further Reasons [40].

[59]Further Reasons [41].

The judge then turned to the question whether the easement should allow the respondent to store, either temporarily or permanently, fixtures, chattels or wood on the disputed land The applicant had objected on the basis that such a provision would impinge on his, and any subsequent owner’s, possession and enjoyment of the land. His Honour analysed this aspect by examining the extent of the ’ancillary rights’ in connection with the easement that had been found. In this respect, the judge said that it seems to be established in Australian law that an easement can comprise a right of recreation, but that there are few cases which address the ‘ancillary rights connected with an easement of this kind, such as the rights to tend to a garden, attach fixtures or store items’.[60]
[60]Further Reasons [45].

The judge considered this question by reference to the decision of the Court of Appeal of England and Wales in Jackson v Mulvaney[61] and a discussion of that case in the leading textbook on this subject matter, Gale on Easements.[62]
[61][2003] 1 WLR 360 (‘Mulvaney’).
[62]J R Gaunt and P Morgan, Gale on Easements (Sweet & Maxwell, 20^th ed, 2017) 39–40 [1-71].

The judge approached the scope of the easement by reference to an organising principle that the easement should permit the owner of the dominant tenement to continue to engage in the same activities that had been undertaken on the land during the relevant period leading up to the creation of the easement.

Applying that principle, the judge said ‘the easement contemplates that Jennings can continue to have … outdoor furniture located on that part of Laming’s land the subject of the easement.’[63] A similar approach was taken in relation to the storage of firewood.[64]
[63]Further Reasons [50].
[64]Further Reasons [51]–[53].

The judge concluded:

In summary, the Howards and Jennings used the area of the Disputed Land subject to the easement in and after 1986 as a backyard. It represented an extension of the house property at 2 Merimbula Road and, for practical purposes, was effectively treated as part of that property. That is why the Howards called it their backyard and why Jennings treated it as such.

It is against that factual background that I say that my characterisation of the easement contemplates or includes use of the area the subject of the easement for activities such as the cutting of the grass, the clearing and burning of green waste, maintaining and enjoying the trees, playing games and sports, engaging in general recreational activity including entertaining family and friends.[65]

[65]Further Reasons [54]–[55].

The judge recorded that the respondent, but not the applicant, had responded to his invitation to address Mulvaney. The respondent submitted that Mulvaney stood for two principles. First, an easement for a communal garden arising by prescription does not exclude the registered proprietor and secondly an easement for a communal garden must have its character retained. However, specific features are not protected so long as any alterations by the servient owner do not substantially interfere with the easement, are reasonable, and are made with notice. In relation to those matters, the respondent submitted that the applicant had not been excluded from the disputed land and it was not necessary to resolve any particular proposal regarding future use.[66]
[66]Further Reasons [56].

The orders

The judge made orders with the following declarations:

1. The defendant [Mr Jennings] has not acquired title by adverse possession to any part of the land described in Certificate of Title Volume 11334 Folio 624 and known as 4 One Tree Hill Road, Ferny Creek, in the State of Victoria.

2. The land marked ‘E-1’ in the attached plan of easement dated 10 October 2017, within the registered title boundaries of 4 One Tree Hill Road, more particularly described as Certificate of Title Volume 11334 Folio 624, is burdened by an easement in favour of 2 Merimbula Road, Ferny Creek, in the State of Victoria, more particularly described as Certificates of Title Volume 9939 Folio 326 and Volume 8345 Folio 110, for the purposes of recreation. The permitted usage includes burning green waste and storing domestic firewood.

3. The easement may be exercised by the registered proprietor of the dominant tenement alone or with invitees or by invitees alone.

The plan attached to the orders, entitled ‘plan of creation of easement’, is a two-sided document, the front of which contains various pieces of information set out in boxes. The box entitled ‘easement information’ contains a number of columns. Below the column marked ‘purpose’ appears the following: ‘recreation, entertainment and use as a backyard’. The second page of the document contains a plan of the Laming land with the easement marked as ‘E-1’.

His Honour also made orders in respect of nominal damages for trespass, and costs.

The proposed grounds of appeal

The application for leave to appeal contained eight proposed grounds of appeal which were distilled in oral argument to four essential grounds. In the order they were advanced, these grounds are:

(v) the judge erred in finding that Telstra had knowledge of user of the land by the Jennings and their predecessors in title;

(w) the form of the easement is too wide and uncertain to be recognised at law and the evidence of user could not give rise to such a broadly defined easement;

(x) the easement as found is inconsistent with the possessory rights of the applicant and is unworkable; and

(y) s 42(2)(d) of the TLA does not operate to preserve easements that do not subsist at the time of registration.

Although the respondent had contended in written submissions that the applicant’s written case included matters that were not argued below, this contention was not pressed before us.

For the reasons that follow, leave to appeal should be granted in respect of all the above proposed grounds as reformulated. We will consider each of these four grounds in turn.

Ground 1 — knowledge

The parties’ submissions

The applicant commenced his oral submissions with the proposition that the relevant enquiry is whether the servient owner had knowledge of, and acquiesced in, the acts of user that gave rise to the easement. It was said that the doctrine of lost modern grant is grounded in the concept of an implied contract between the servient owner and the dominant owner.

The applicant submitted that the judge had failed to identify the relevant acts of user with the precision required to establish that the servient owner had knowledge of those acts. This was said to be particularly important in the present context where many of the acts relied on were transient and occurred sporadically over an extended period of time, and where the issue was not simply whether the acts occurred but also the character that they bore.

The applicant challenged the judge’s findings on knowledge on two bases. First, it was submitted that, as a matter of law, the constructive knowledge of Telstra’s agents should not be imputed to Telstra. As authority for that proposition, the applicant relied on Hedigan J’s decision in Sunshine Investments.[67]
[67][1999] VSC 415 [117], [119].

Secondly, it was submitted that there was an insufficient factual basis for a finding that Telstra knew or ought to have known of the relevant acts. Even if Telstra employees had seen the mown areas, they would reasonably have assumed no more than that this was to mitigate fire risk (rather than evidence of a proprietary right to use the disputed land). The applicant referred to the transient and sporadic nature of many of the activities said to constitute user, submitting that these would leave ‘no obvious trail to alert the owner’. The picnic table and clothesline were indicators of user, but they were placed on the land well within the relevant 20 year period.

In answer, the respondent pointed to passages of the judge’s reasons in which his Honour described the activities that he found took place on the disputed land. It was submitted that recreation encompasses a variety of activities, and that the applicant was ‘slicing and dicing’ in asserting that there was no evidence of open and continuous user of the disputed land for that purpose.

The respondent submitted that the judge correctly found that Telstra’s agents had actual knowledge of user. The respondent relied on the judge’s findings that Telstra employees had gone on to the Telstra land to mow the grass, perform work on the communications facilities, and meet with local residents to discuss fire risks. The respondent submitted that, consistently with the principles enunciated by Hedigan J in Sunshine Investments, the actual knowledge of Telstra’s agents could be imputed to Telstra as constructive knowledge.

The respondent also relied on the judge’s finding that Telstra had constructive knowledge because there were physical differences between the disputed land and the rest of the Telstra land which would have put Telstra (or its agents) on inquiry.[68]
[68]Reasons [221].

Finally, the respondent submitted that the judge correctly recognised that there was an evidentiary burden on the applicant to prove a lack of knowledge once open user of the land was established, and that the applicant had not challenged the judge’s finding that the presumption of knowledge had not been rebutted.

Relevant principles

The recognition of both adverse possession and an easement by prescription share an important conceptual underpinning. They reflect the circumstances in which the common law recognises long-established de facto enjoyment of property. Importantly, they focus not just on the conduct of the claimant but on the position of the owner of the land. As explained by Lord Hoffman in R v Oxfordshire County Council; Ex parte SunningwellParish Council:

[the common law] did not treat long enjoyment as being a method of acquiring title. Instead, it approached the question from the other end by treating the lapse of time as either barring the remedy of the former owner or giving rise to a presumption that he had done some act which conferred a lawful title upon the person in de facto possession or enjoyment.[69]

[69][2000] 1 AC 335, 349.

His Lordship went on to observe that, in the case of rights by prescription, the effluxion of time is not used to bar the remedy but to presume that enjoyment was pursuant to a right having a lawful origin.[70]
[70]Ibid 350.

Essentially, an easement arising by a presumption of lost modern grant will be found where there is an open and uninterrupted enjoyment of land for at least 20 years that is not explained by an express grant of an easement or permission to use the land.

The underlying rationale is that the courts presume a long assertion of right as having a proper legal foundation and that the owner, by its acquiescence in the face of an assertion of title, must be taken to have conferred the interest by grant. As Lord Herschell said in Philipps v Halliday, ‘the Courts will presume that those acts were done and those circumstances existed which were necessary to the creation of a valid title.’[71] The legal fiction upon which the precept of lost modern grant depends is that the paper owner has conferred a right by grant but that the grant is lost.
[71][1891] AC 228, 331.

It is necessary to examine both the acts of the claimant (and its predecessors in title) and the response of the owner. From the perspective of the claimant, its acts and conduct must manifest an assertion of right to do the thing claimed. In relation to a prescription by long user, the long enjoyment must have been ‘neither by violence, nor by stealth, nor by leave asked from time to time’.[72]
[72]Mills v The Mayor, Alderman, and Burgesses of Colchester (1867) LR 2 CP 476, 486. The Latin phrase ‘nec vi, nec clam, nec precario’ is commonly used.

The first of these requirements recognises that the owner should not be required to resist the application of force. The second requirement, that the enjoyment of the claimant must not be secret, means that the prescription cannot arise where the acts would not be known to an owner reasonably diligent in protecting its rights. The third requirement allows the owner to consent or give a licence to the use of the land, but not at the cost of having the land burdened by a proprietary interest of the user.[73]
[73]R v Oxfordshire County Council; Ex parte SunningwellParish Council [2000] 1 AC 335, 351 (Lord Hoffman).

Where those requirements are satisfied, the paper owner would be expected to resist the assertion of right or face the consequences of an easement by prescription arising if it fails to do so. In that context, Fry J said in Dalton v Angus that the whole law of prescription rests upon acquiescence of the owner.[74]
[74](1881) 6 App Cas 740, 773.

It is a reflex of the requirement that the acts not occur by stealth and a precondition for acquiescence that the servient owner have knowledge of the acts that constitute the claimed assertion of title and the power to stop them. In many cases, the conduct of the claimant will relate to a recognisable aspect of title. The use of part of the servient land as a right of way provides an obvious example.

Identifying the facts that constitute the relevant assertion of title becomes more difficult when the claimant seeks to aggregate a number of different acts or activities which together amount to a particular assertion of title. The difficulty arises in two ways. First, it is necessary to establish that the servient owner had knowledge of all, or at least a sufficient range, of the relevant acts and that the owner knew that, from those acts taken together, the claimant was asserting a particular right or interest in respect of the land.

Secondly, in order to establish long user, the claimant must establish that the user has continued for at least 20 years. If the character of earlier events can only be understood by reference to, or in combination with, later conduct, it would follow that the 20 year period would only commence once a sufficient number of the acts had been undertaken and that, in combination, they are continued over the 20 year period.

It is at this point that there is an overlap between the question of knowledge and the requirement that the easement be of a type that is clearly identified and capable of being recognised by law. This latter aspect is the subject of the second ground raised by the applicant, which we address later in our reasons.

The relevant knowledge for the purposes of prescription includes both actual knowledge and, in certain circumstances, forms of constructive knowledge. In the case of a corporate owner, actual knowledge will include the knowledge of its agents with sufficient and relevant authority to bind the owner as principal.

Constructive knowledge in the present context means the knowledge that a reasonably diligent owner would have obtained exercising reasonable care in protecting its own rights and interests.[75] Assessing what a reasonably diligent owner would know, and what he or she would be expected to make of that knowledge, will often depend on observation and on whether the owner was put on inquiry as to the use of the land by the claimant.
[75]Union Lighterage Co v London Graving Dock Co [1902] 2 Ch 557, 570–1 (Romer LJ); Milne v James (1910) 13 CLR 168, 177 (Griffith CJ); Gangemi (1994) 11 WAR 505, 515–16 (Seaman J, with whom Ipp and Wallwork JJ agreed); Williams v State Transit Authority (NSW) (2004) 60 NSWLR 286, 293 [85] (Mason P, with whom Sheller and Tobias JJA agreed) (‘Williams’).

At this point, two related and contested propositions of law become relevant. The first is that knowledge constructively acquired by an agent cannot be imputed to the owner. The second is that it is presumed, in the face of open user of land over a period of years, that the owner had knowledge of that user. The trial judge did not apply the first proposition but did apply the second. The applicant contended that the judge ought to have applied the first proposition to exclude reliance on knowledge constructively acquired by Telstra’s agents and employees. The respondent submitted that the judge was correct to apply the presumption.

That presumption, which is evidentiary in nature and does not displace the onus which lies on the party asserting the existence of an easement, is supported in the Australian authorities. It is often traced to Pugh v Savage,[76] where Cross LJ (with whom Harman and Salmon LJJ agreed) held that, where long user of a way has been shown, the law should presume, in the absence of any evidence to the contrary, that the owners of the land knew of that user.[77] Cross LJ applied the presumption to establish that successive prior owners of the relevant land knew of user of the land for a period of 18 years which, when added to actual knowledge on the part of the current owner, satisfied the 20 year period.
[76][1970] 2 QB 373.
[77]Ibid 384.

In Diment v NH FootLtd,[78] Pennycuick V-C approved this statement of the law and said that, in a case where long user has been shown, instead of the owner of the dominant tenement having to establish affirmatively that the owner of the servient tenement did have knowledge, the owner must establish that it did not.[79] However, he was not prepared to extend this presumption to a firm of chartered surveyors acting as the owner’s agent. It had been proved that the owner herself lacked knowledge of the user. The Court rejected an argument that the presumption applied to her agent, so as to presume it to have either knowledge of the user of the way or the means of such knowledge, in either case binding on the owner. Pennycuick V-C stated:

I do not think the presumption can legitimately be carried so far where a landowner employs an agent in connection with the property. There cannot, I think, be a presumption, merely by reason of that relation and without reference to the particular circumstances, that the agent has knowledge or means of knowledge of any particular act upon the land. That would be carrying this presumption altogether beyond anything that was said in Pugh v Savage …[80]

[78][1974] 1 WLR 1427 (‘Diment’).

[79]Ibid 1434.

[80]Ibid 1434-5.

The presumption articulated in these cases has been applied in Australia.[81] As the above passage in Diment shows, it is not a presumption which can be employed for the purpose of attributing knowledge or the means of knowledge to an owner’s agent in circumstances where it is proved that the owner had neither. However, in our opinion, Diment does not stand for the proposition, advanced by the applicant, that constructive knowledge on the part of an agent is legally incapable of binding the principal. Rather, Diment shows that there is not a further presumption against an owner that, merely because of the existence of the agency, his or her agent has knowledge or the means of knowledge of a particular use of the land. In our opinion, the question whether knowledge or means of knowledge on the part of an agent will bind the owner will instead turn on the circumstances of the case, including the nature of the relationship between the agent and the owner.
[81]Gangemi (1994) 11 WAR 505, 514, 516 (Seaman J, with whom Ipp and Wallwork JJ agreed); Sunshine Investments [1999] VSC 415 [124] (Hedigan J); Fernance v Simpson [2003] NSWSC 121 [31]–[33] (Windeyer J); see also Nelson v Hughes [1947] VLR 227, 228 (Lowe J). The presumption was given a more confined operation in Wayella Nominees Pty Ltd v Cowden Ltd [2003] WASC 210 [245]–[249] (Roberts-Smith J).

Sunshine Investments[82] provides a useful example. In that case, a group of residents in Toorak claimed that they had a pedestrian right of way over a path in front of an apartment block. A key issue in the case was whether the servient owner knew of the use of the path as a right of way. Hedigan J accepted that the path was ‘moderately busy’ with a substantial number of local residents traversing it as a shortcut to the amenities on Toorak Road.[83] However, his Honour was not satisfied that it would have been apparent to an ordinary, diligent owner that the residents were using the path. In reaching this conclusion, his Honour had regard to the fact that the walk along the path would have taken just a few minutes, the residents using the path would have been barely visible from within the apartment block, and that it would have been expected that there would be a substantial number of people moving about the apartment block in any event.[84]
[82][1999] VSC 415.
[83]Ibid [102].
[84]Ibid [123].

Relevantly for present purposes, Hedigan J concluded that, as a matter of agency law, only actual knowledge on the part of an agent will be imputed to the owner. He considered that the doctrine of constructive knowledge in this context is based on the existence of a duty on the part of an agent to communicate knowledge to the principal.[85] His Honour went on to say:

If, as I accept to be the proper legal conclusion, that information ‘constructively’ acquired cannot be imputed to the principal, then reliance by the claimants on the alleged observations by gardeners, or painting and maintenance men, does not advance the claimant’s case at all.
…
[I]t seems impossible to conclude, as counsel for the residents asked me to conclude, that these trade-persons were under a duty to pass on to the managing agent knowledge of use of the footpath by persons other than tenants and their guests, even if they knew that. I would not myself have thought they had any other duty than to carry out their work with proper care and skill.[86]

[85]Ibid [117].

[86]Ibid [117], [119].

At first blush, the approach of Hedigan J differs from that in Diment in so far as Pennycuick V-C treated the question as being whether the owner’s agent had knowledge or the means of knowledge, and declined to extend the presumption to that context. In other words, Pennycuick V-C did not rule out the possibility of an agent’s constructive knowledge binding the principal. However, we do not read Hedigan J as excluding the prospect that circumstances beyond the mere fact of agency may justify attributing to an owner the constructive knowledge of that owner’s agent. In particular, the relationship between owner and agent might reveal the existence of a duty to communicate relevant knowledge to the owner. In this way, both decisions recognise that the circumstances of the relationship between owner and agent might serve to fix the owner with the actual or constructive knowledge of the agent.

It follows that it is to be presumed against an owner that open user of the land over a period of time has taken place with the owner’s knowledge, but the presumption may be displaced by evidence as to the owner’s lack of knowledge. There is not a further presumption against an owner that, merely because of the existence of the agency, his or her agent has knowledge or the means of knowledge of a particular use of the land. Further, proof that an agent of the owner had actual or constructive knowledge of the relevant user will not of itself establish that the owner had such knowledge. Something more in the nature of the relationship between owner and agent is required before that conclusion can be drawn.

In assessing the cogency of the evidence, it is important to keep in mind that the court should not be astute to find an easement by prescription, particularly one that has the breadth of that claimed here.[87] The doctrine of lost modern grant is based on the fiction that the owner of the servient tenement has granted the rights by deed. Where the rights conferred by the claimed easement are broad or unusual, and where the grant confers no corresponding benefit on the servient tenement, the court should carefully assess the adequacy of evidence as to both use and knowledge.
[87]Sunshine Investments [1999] VSC 415 [147].

With those principles in mind, we now turn to the competing contentions.

Consideration

The judge identified various acts that had occurred on the disputed land between 1986 and 2015, when the issue of the respective rights of the parties to the disputed land first arose. They included the removal and planting of trees (including the stand of cotoneaster trees located on the boundary), the removal of the concrete and wire fence along the boundary, the construction of steps and a rock wall, mowing of the grass area so as to make it suitable for private recreational purposes, maintenance of the land, and the storage of firewood on the land.[88]
[88]Reasons [44], [159].

The judge did not make a finding that Telstra knew that these activities had occurred on its land in the sense that they had in fact been observed by officers of Telstra with relevant authority. He accepted that evidence as to Telstra’s relevant written records revealed that Telstra had no knowledge of anyone occupying or using part of the Telstra land.[89] However, the judge found that:
[89]Reasons [233].

(z) the Telstra employees (and later, contractors) mowing the Telstra land would have had actual knowledge that the disputed land was ‘being used differently from the rest of the Telstra property’;[90]
[90]Reasons [228].

(aa) the Telstra employees or contractors who conducted the surveys in 1995 and 1997 would have seen that the disputed land was ‘in a different condition from the rest of the Telstra Property’;[91]

(bb) Telstra knew, or should have known, that the disputed land was ‘being used by third parties in a way which made it quite different from the rest of the Telstra Property’;[92] and

(cc) Telstra employees attending at the disputed land and conducting radiation testing near the fence line would or should have noticed that the grass on the disputed land appeared ‘different from the rest of the grassy areas on the Telstra Property’.[93]

[91]Reasons [229].

[92]Reasons [233].

[93]Reasons [235]–[236].

Specifically in relation to constructive knowledge, the judge concluded:

in this case the owner or agent could be put on enquiry by being in proximity to the Disputed Land where there were visible signs of its use as a backyard: the closely mown grass, and later, the domestic fruit trees and the clothes line, which appeared sometime between 2000 and 2005. Hence, if Telstra had been at all diligent in protecting its interest in the Telstra Property and had actually inspected the land or its boundaries, it would have discovered evidence of the use to which others had put the Disputed Land.[94]

[94]Reasons [230].

It may be noted that the evidence of knowledge did not extend to the uses of storage of firewood and the burning of green waste, save that the judge referred at [233] of the reasons to Mr Knight’s evidence that he had told Mr Howard not to burn off when the wind was blowing towards the tower so as not to set off an alarm. The respondent’s case rested on establishing the easement for recreation to which those matters were ancillary.[95] It is therefore convenient to refer to the easement as found by the judge as an easement for recreation.
[95]Although the judge did not expressly describe the burning of green waste as an ‘ancillary’ use, the description is apposite and there is no other basis upon which the easement for that use was sought to be sustained.

In our view, for the reasons that follow, the findings made by the judge do not support the conclusion that Telstra had knowledge, either actual or constructive, that the owners of the Jennings land had engaged in conduct that constituted an assertion of a legal interest to use the disputed land (or part of it) for recreation. It will be necessary to consider the breadth of the concept of recreation under ground 2.

The judge’s findings were general in nature and amounted to a conclusion that the disputed land was in a different condition or was being used in a different way to the balance of the Telstra land. The main factual bases for that conclusion were that the grass had been mown, trees had been planted and, at some point, a clothesline had been installed.

Apart from the clothes line, which was installed much later, those observable features were rationally explicable as fire mitigation and improving the aesthetic outlook from the house on the Jennings land which, it will be recalled, is close to the boundary. There was evidence before his Honour that fire was a real risk in the area and that the long grass on the Telstra land was a cause for some local concern.[96] The evidence surrounding the planting of trees was also consistent with aesthetic purposes.
[96]Reasons [35], [44], [89], [233], [253].

Many of the acts of user relied on by the respondent were not found to have been observed by Telstra and were transient and sporadic. These acts left few, if any, permanent features that would suggest to an observer that the disputed land had been used for recreation and that the owners of the Jennings land were asserting a legal right to use the disputed land for that purpose. For these reasons, in our opinion, the respondent failed to establish actual knowledge by Telstra of use of the land by the respondent for recreational purposes.

The relatively sparse findings of fact as to knowledge could not be bolstered by recourse to constructive knowledge. In our view, the differences between the disputed land and the rest of the Telstra land were not such as to put Telstra’s agents or employees on an inquiry that would have revealed that the Howards and then the Jennings were using the disputed land (or part of it) as their backyard and asserting title to do so. Especially given that Telstra’s agents and employees were only on the land intermittently, the observable state of the disputed land, including the mown grass, was not sufficient to give rise to constructive knowledge of the use of the land by the Howards or the Jennings for recreation. That was because the observable state of the disputed land, when compared to the balance of the Telstra land, had a logical connection with fire mitigation and improved outlook. In contrast, the owners in Gangemi had an obvious means of knowledge of the use of their land as a laneway because there were double gates onto the dominant tenement allowing access to and from the servient tenement.[97]
[97]Gangemi (1994) 11 WAR 505, 515 (Seaman J, with whom Ipp and Wallwork JJ agreed).

Even if the placement of domestic fruit trees or the clothesline would have, in conjunction with the closely mown grass, put a reasonable, diligent owner on inquiry, the evidence did not establish that such an inquiry would have established the necessary period of user. The fruit trees appear to have been planted in the 1990s, but the clothesline was not erected until some time between 2000 and 2005, well into the 20 year period.

The applicant identified the 20 year period as being between 1995 and 2015 (when the respondent made his claim to title)[98] and submitted, correctly, that anything that occurred for the first time after 1995 could not be a relevant use except in so far as the act in question is of such a nature that it could be inferred that it had also taken place prior to 1995.
[98]Proposed ground 8 in the application for leave to appeal is that the judge erred in finding that periods of user of the disputed land by the respondent and his predecessors in title ran against the Crown. It was submitted that the earliest date that a period of relevant user could have commenced was November 1991, when title to the Telstra land was transferred from the Commonwealth to Telstra. This ground was not developed in oral submissions and it is unnecessary to consider it further.

In circumstances where the conditions observable by the Telstra agents and employees did not give them either actual or constructive knowledge of the respondent’s use of the disputed land for recreation, it is not necessary to consider further the attribution of any such knowledge to Telstra itself.

The presumption in Pugh v Savage,[99] upon which the trial judge relied,[100] is insufficient to make out the respondent’s case. The evidence showed that Telstra had no written record of the use of the disputed land by the respondent or his predecessors in title. To the extent that the presumption was relied upon to fasten Telstra with actual knowledge, it was therefore displaced. In so far as the presumption was said to fix Telstra with constructive knowledge through the observations of its agents and employees, as explained earlier, the presumption does not apply to attribute knowledge or the means of knowledge to an owner merely by presuming that an agent of the owner had the requisite knowledge or means of knowledge. Here there was no suggestion that the agents or employees of Telstra who conducted the occasional activity on the Telstra land were under any duty to communicate to Telstra their knowledge of potential signs that the disputed land was being used for recreation. As in Diment and Sunshine Investments, it would be pushing the presumption too far to presume that Telstra had knowledge or constructive knowledge of the respondent’s use of the land merely on the basis of the existence of the relationship between Telstra and its agents and employees.
[99][1970] 2 QB 373.
[100]Reasons [234]–[235].

In summary, there was an insufficient factual foundation for the judge to conclude that Telstra had knowledge, either actual or constructive, of the facts necessary to establish the easement found by the judge.

We would uphold ground 1.

Ground 2 — the easement is too broad

The second ground is that the easement is too broad and not supported by the evidence. Given that we would uphold ground 1, it is not strictly necessary to decide ground 2 but it is desirable to do so as it raises questions going to the nature and scope of the easement found by the judge.

The parties’ submissions

The applicant submitted that the easement is far more extensive and diffuse than the typical kind of easement. It was submitted that the easement found by the judge is not recognised at law, and that the breadth and uncertainty of the easement has consequences in relation to the strength and cogency of the evidence needed to justify it.

The applicant referred to the judge’s characterisation of the easement as one conferring on the dominant owner a ‘[r]ight to use [the] area as a garden or backyard’. The applicant observed that no easement of use as a backyard has been found to arise by prescription in any common law jurisdiction, and that the easement found by the judge is therefore a ‘novel legal fiction’. The applicant sought to distinguish those cases where courts have found easements for recreation on the basis that, in those cases, the easements were created by express grant and gave the dominant owners the right to use common areas.

In response, the respondent referred to Re Ellenborough Park,[101] Mulvaney,[102] Riley v Penttila[103] and City Developments Pty Ltd v Registrar-General (NT)[104] as authorities for the proposition that a right of recreation may be the subject of a valid easement. It was submitted that the categories of prescriptive easement are not closed, and that there is no reason in principle why an easement for recreation could not arise by prescription.
[101][1956] Ch 131, 163.
[102][2003] 1 WLR 360.
[103][1974] VR 547.
[104][2001] NTCA 7 (‘City Developments’).

In oral argument, the respondent acknowledged that the courts have not sought to define recreation and that the concept of recreation can change over time, according to the usages of mankind. It was submitted that, nonetheless, ‘most people have a good idea, as a general principle … [as to] whether something is recreation or not.’

The easement as found

The starting point of the analysis is the correct construction of the easement found by the judge. The declaration is set out above at [65] above. Omitting matters of detail, the Court declared that the ‘land marked “E1” in the attached plan … is burdened by an easement in favour of 2 Merimbula Road … for the purposes of recreation. The permitted usage includes burning green waste and storing domestic firewood.’

The meaning of a court order is to be derived from the language used, read fairly. The exercise is objective and does not involve delving into the subjective thought processes of the judge who made the order.[105] At least in the case of ambiguity or where the language is susceptible of more than one meaning, it is open to have recourse to extrinsic material, including the reasons for judgment.[106] Of course, the exercise remains one of interpretation and not reconstruction, and where recourse to such material is permitted, it is not admissible to contradict the plain meaning of the order.
[105]Radmanovich v Nedeljkovic [2002] NSWSC 212 [7] (Young CJ in Eq).
[106]Wende v Horwath (NSW) Pty Ltd (2014) 86 NSWLR 674, 689 [60] (Basten JA); Slea Pty Ltd v Connective Services Pty Ltd [2018] VSCA 180 [30].

In our view, the easement has three aspects: recreation, storage of firewood and burning green waste. There is nothing in the form of the order that would extend its reach to include all of those matters that might naturally or usually be undertaken in a backyard. The respondent submitted, correctly, that the form of the easement was deliberately confined and that it is not an easement to enjoy the land as a backyard.

Although the meaning that may be attributed to the word ‘recreation’ will depend on context, storing firewood and burning off would not ordinarily constitute acts of recreation. We are not persuaded that the easement should be construed broadly in the manner advanced by the applicant. Although that is how the respondent advanced his case at trial (as an alternative to adverse possession), it is not reflected in the terms of the declaration ultimately made. Given that the order reflects the terms of a proprietary interest that will run with the land, the justification for recourse to extrinsic material is necessarily qualified and we would be slow to go beyond the words of the order.

We would not read the reference to ‘recreation, entertainment and use as a backyard’ in the plan attached to the order as qualifying or altering the language of the order itself. The order adopts the plan only for the purpose of identifying the affected land. To the extent that the plan purports to describe the extent of the easement beyond that, it is inconsistent with the order and of no effect.

Construed in the manner set out above, the easement found by the judge is similar in nature and extent to those which were found to be valid in Re Ellenborough Park[107] and Mulvaney,[108] cases decided by the Court of Appeal of England and Wales, and, in the Australian context, by a single judge of this Court in Riley v Penttila[109] and by the Court of Appeal of the Northern Territory in City Developments.[110] Before deciding whether the easement granted in the present matter is sustainable on that basis, it is necessary to consider those cases.
[107][1956] Ch 131.
[108][2003] 1 WLR 360.
[109][1974] VR 547.
[110][2001] NTCA 7.

Re Ellenborough Park and Mulvaney stand for the proposition that use of a communal garden for recreational and amenity purposes or use of a common area for recreation may be the subject of a valid easement. Such an easement would not fail as being impermissibly wide or vague, nor does it necessarily carry with it any undue interference with the possession of the servient land by its owner.

Re Ellenborough Park

Ellenborough Park was a piece of open land surrounded on three sides by roads and houses fronting on them. The fourth side, which faced towards the sea, was open and had not been built on. Ellenborough Park and the surrounding roads and houses were formerly part of a single estate. Various plots surrounding the park were sold for residential purposes and the relevant conveyances included an easement in favour of the purchasers as to the:

full enjoyment … at all times hereafter in common with the other persons to whom such easements may be granted of the pleasure ground … in the centre of the square called Ellenborough Park… but subject to the payment of a fair and just proportion of the costs charges and expenses of keeping in good order and condition the said pleasure ground.[111]

[111]Re Ellenborough Park [1956] Ch 131, 165 (Lord Evershed MR).

Lord Evershed MR concluded that the enjoyment contemplated was the enjoyment of the garden in its physical state. The right was a right to walk on or over pathways, to rest on seats, and, if certain parts were set apart for particular recreation such as tennis or bowls, to use those parts for those purposes, subject to any regulations. The right did not extent to ‘trampl[ing] at will all over the park’, cutting or plucking flowers or shrubs, or interfering with the laying out or upkeep of the park.[112] His Lordship found that the easement was a ’common and clearly understood conception, analogous to the use and enjoyment conferred upon members of the public, when they are open to the public, of parks or gardens’.[113]
[112]Ibid 168.
[113]Ibid 168–9.

His Lordship also rejected the contention that the easement amounted to joint occupation of the park, distinguishing the case before him from Copeland v Greenhalf, where Upjohn J found that a putative easement for the storage of vehicles amounted to a claim to possession of the servient tenement.[114] His Lordship concluded that the rights were not rights of proprietorship or possession, any more than a right of way granted through a passage or the use of public gardens conveyed such rights.[115]
[114][1952] Ch 488, 498 (‘Copeland’).
[115]Re Ellenborough Park [1956] Ch 131, 176.

Mulvaney

The validity of an easement for the enjoyment or use of an area as a garden was again considered by the Court of Appeal in Mulvaney.[116] In that case, the Court upheld an easement found by the primary judge and made a declaration that ‘the claimant is entitled to a right to use the blue land as a communal garden for recreational and amenity purposes’.
[116][2003] 1 WLR 360.

The claimant owned one of a group of cottages. Each cottage enjoyed an easement over a strip of land at the rear of the cottage which gave the owner ‘a right of way at all time and for all purposes in common with the vendors and all persons having the like right over and above the open yard adjoining the said premises and coloured blue on the said plan’.[117]
[117]Ibid 361 [2] (Latham LJ, with whom Mance and Simon Brown LJJ agreed).

The claimant had, over an extended period of time, used part of the strip at the rear of her cottage to tend a garden consisting of a grassed area and a flower bed abutting the wall along one side of the strip. Without her consent, the owners of the strip of land removed the flower bed and part of the grassed area with the intention to deposit gravel for the purposes of improving vehicular access. The claimant sought a declaration that she held freehold rights over the land for ‘the purposes of cultivating, mowing and otherwise enjoying the same and hanging washing’.

The evidence established long use of the strip of land as a communal yard and that it was used by the residents of the cottages as amenity and garden land on a shared basis. The evidence showed certain ‘ground rules’ or understandings ‘to avoid anarchy … [which] included provision of washing lines, space for dustbins and allocation of small flower beds so that the yard would resemble a domestic garden and be more attractive as an amenity enjoyed by all’.[118] The primary judge made findings that the previous owners had known of, and acquiesced in, what was going on and benefited from the higher prices that would be at attained when the residents came to sell individual properties.[119]
[118]Ibid 363 [6] (Latham LJ, with whom Mance and Simon Brown LJJ agreed).
[119]Ibid.

The primary judge found an easement in the form of a right to cultivate the common garden, hang washing, and generally enjoy the land.

Before the Court of Appeal, the owners of the land submitted, however, that the easement as found was so extensive as to amount to a claim to exclusive possession and was an attempt to ‘dress up’ a claim for adverse possession which could not succeed because of the shared nature of the use.[120]
[120]Ibid 365 [10] (Latham LJ, with whom Mance and Simon Brown LJJ agreed).

The owners of the land accepted that an express grant of the right to the enjoyment of a communal garden could constitute a valid easement.[121] However, they sought to distinguish Re Ellenborough Park on the basis that, in that decision, the servient owners retained the right to the produce from the garden and to design and maintain it as they wished, subject only to the obligation that it should remain available as a communal garden to the dominant owners. By contrast, it was contended that, in the present case, the use relied on by the claimant as establishing her prescriptive rights indicated that she and other cottage owners had asserted the right to control and maintain the area as a communal garden and amenity space.[122]
[121]Ibid 366 [12] (Latham LJ, with whom Mance and Simon Brown LJJ agreed).
[122]Ibid 366 [15] (Latham LJ, with whom Mance and Simon Brown LJJ agreed).

The Court of Appeal found in favour of the claimant. It accepted, on the basis of Re Ellenborough Park, that an easement to use land as a communal garden was capable of forming the subject matter of a grant.[123] Further, the factual findings conclusively established that the servient owners had been content over the years to allow the owners of the cottages to determine the layout of the garden and to maintain it themselves, but this was not inconsistent with a communal garden.[124]
[123]Ibid 368 [23] (Latham LJ, with whom Mance and Simon Brown LJJ agreed).
[124]Ibid 369 [24] (Latham LJ, with whom Mance and Simon Brown LJJ agreed).

However, that conclusion did not entail that the right created by the established use excluded the servient owners from any use which they might wish to make of the land used as the communal garden. Their use was restricted to the extent necessary to ensure that the land as a whole could still be enjoyed by the owners of the cottages, and in particular the claimant, as a communal garden for recreational and amenity purposes.[125]

Australian authorities

[125]Ibid 369 [26] (Latham LJ, with whom Mance and Simon Brown LJJ agreed).

In Riley v Penttila,[126] Gillard J held that an express grant that provided to the transferee ‘liberty’ to use and enjoy a reserve ‘for the purpose of recreation or a garden or a park but subject to such rules and regulations respecting the user’ as may be made could constitute a valid easement. The use of the reserve served all the lots abutting it. Applying Re Ellenborough Park, his Honour held that enjoyment of a defined area for recreation was sufficiently precise to found an easement.[127]
[126][1974] VR 547.
[127]Ibid 557–8.

To similar effect, the Court of Appeal of the Northern Territory in City Developments held that an area adjoining a lake could be subject to easements providing for a right to use the land for ‘private recreational purposes’ or for ‘recreational purposes’, in both cases ‘in common with … other persons having the like right’.[128]

Consideration

[128]City Developments [2001] NTCA 7 [6], [7], [18] (Angel J, with whom Martin CJ and Bailey J agreed).

Based on those authorities, an easement for recreation is a recognised and permissible form of easement. However, the contexts in which easements for recreation have been upheld are very different to that in the present case and, in our view, can be distinguished. The easements in the above cases were created over land which had a common or communal character. Ellenborough Park had been reserved as a communal area for the common enjoyment of multiple residents. In the case of Mulvaney, the strip of land was a right of way reserved for the cottage residents and which the residents had tended as a garden for common enjoyment. The meaning and operation of the easement for recreation was to be understood in that context. In both Riley v Penttila and City Developments, the right to use the servient tenement was again enjoyed in common with others.

Here, the disputed land forms part of a single private land holding. It is true that, by reason of its ownership by Telstra over a number of years, many of the neighbours used the Telstra land and also the disputed land for recreation. However, it could not be said that the disputed land was used in a communal manner. Nor would an easement of that kind be consistent with the case advanced by the respondent at trial, which depended upon the respondent exercising rights (whether of possession or recreation) to the exclusion of the applicant. In the cases mentioned above, the court was not concerned with two private owners exercising rights over the same land which lacked any communal character.

This was not a case where the owner has, in effect, dedicated the land for the purposes of communal recreation. In other words, unlike the land in Mulvaney, for example, the disputed land is not required to retain the character of a place for communal recreation.[129] It follows that, although an easement for recreation in common is recognised at law, the easement found in the present case was not of that nature and cannot be sustained on that basis.
[129]Mulvaney [2003] 1 WLR 360, 369 [27] (Latham LJ, with whom Mance and Simon Brown LJJ agreed).

The question is therefore whether, despite not being an easement in a previously recognised form, the easement found was too wide. The applicant argued that the notion of an easement for recreation, of the width of that recognised in this case, was simply too wide to be recognised at law. By a related argument, advanced under ground 3, the applicant submitted that the easement amounts to a right to possession. It is convenient to defer consideration of that issue to ground 3.

To some extent, the applicant’s argument in this context proceeded upon the basis, which we have rejected, that the easement granted by the judge was to be construed as an easement for the use of the disputed land ‘as a backyard’. But the argument still needs to be considered in light of the more narrowly construed easement for recreation which we have found that the judge did grant.

In [35] of the further reasons, the judge referred to recreation as a general description designed to cover the use which the Howards and the Jennings made of the disputed land after 1986. Those activities included maintaining the area like a garden by cutting the grass, clearing and burning green waste, planting and maintaining trees, playing games, and engaging in different forms of recreational activity such as sports, having coffee while reading, and entertaining family, friends, and neighbours.[130]
[130]Further Reasons [33].

The judge analysed the acts of placing furniture on the disputed land and storing firewood on the basis that they were ancillary rights to the right of recreation.[131] The judge ultimately concluded that these acts were consistent with past use and should be permitted to continue.[132]
[131]Further Reasons [45].
[132]Further Reasons [48]–[53].

The judge’s reference to the easement he had recognised as extending to the use which the Howards and the Jennings made of the disputed land after 1986 must be read in the context of his rejection of the adverse possession claim. For the reasons already given, the easement did not permit use of the disputed land as a ‘backyard’. However, understanding ‘recreation’ in the sense explained by the judge, the easement differs from the easements for use in common with other rights holders recognised in the cases. The difference is that, here, the easement permits use in circumstances where the only other party with rights in respect of the land is the owner. Moreover, the owner has full rights of ownership, subject to the easement.

The potential for inconsistency between the rights of recreation and ownership gives rise to a need to know with certainty what activities or uses of the land are permitted by the easement. Certainty as to the rights and interests attaching to land is one of the central purposes of property law, and the law will not recognise an easement which undermines that purpose. While it is established that rights to use a communal space devoted to recreation are sufficiently certain, there is no case of which we are aware which has upheld a unilateral right of recreation of the kind found here.

As set out above, the judge used the term ‘recreation’ to describe the use which the Howards and the Jennings made of the disputed land after 1986. We have found that the term was not intended to encompass use of the land as a backyard. We have also observed that it is undesirable that the terms of an easement require resort to extrinsic material for their interpretation. In those circumstances, ‘recreation’ must have its ordinary meaning. The cases to which we have referred show that this is capable of defining a valid easement.

But even if ‘recreation’ identifies sufficiently what it is that the holder of the present easement is entitled to do, falling short of use as a backyard, it is not at all clear how that entitlement relates to the rights of the applicant as owner. As the matter proceeded before us, counsel dealt with hypothetical questions about potential areas of doubt and dispute in the enjoyment of the granted easement. The scope for debate about the respective rights of the parties in various circumstances was starkly illustrated. For example, who would have priority if both owners wished to hold a party on the disputed land? Who may decide what is planted or stored on, or removed from, the land? Can either party camp on the land?

It is true that there may also be scope for disagreements and uncertainty between an owner of land and the holders of easements for communal recreation on that land. However, the potential for such issues to arise is significantly limited by the circumstance that the communal nature of the space as one for recreation is intrinsic to its essential character. That provides an important starting point for deciding any dispute between the owner and common holders of the right, and identifies the essential restriction on the owner. It therefore helps to define the easement itself, and the extent to which it limits the rights of the registered proprietor of the land. In the case of a unilateral easement for recreation, that is not the case. There, the owner is not required to ensure that the land remains imprinted with the character of a communal recreational space, but is entitled to use it for myriad non-recreational purposes. That entitlement may give rise to all manner of issues about the scope of the easement.

On this aspect of the case, the easement does not fail because it confers rights of possession on the dominant owner (which we examine under ground 3) but because the rights of unilateral recreation over private land that otherwise lacks any communal aspect are too uncertain and productive of disputation. In the present case, there was no context that could render the easement sufficiently concrete, especially given that the primary claim was an assertion of possessory title.

It might be, in another case, that evidence would reveal a practice or understanding as to the manner in which rights of recreation could accommodate the rights of the owner of the servient tenement. There were, for example, ‘ground rules’ in Mulvaney. Such evidence could potentially enable the easement to be expressed, or construed, with greater particularity than is possible in the present case. It is not necessary for us to express a final view on these matters. That is because, as we have mentioned, in the present case, nothing in the evidence or the way the case was run at trial offers any clue as to how such issues, which did not arise given the state of Telstra’s knowledge, might be addressed in the future.

Although the matter does not strictly need to be decided in light of our conclusion as to ground 1, in our view, the easement found in this case, not being one for communal use of a recreational space, and lacking evidence of the kind described, was of a breadth which the law does not recognise. Accordingly, we would uphold ground 2.

If the easement properly construed is an easement to use the land as a backyard, and not just an easement for recreation, we would again hold that such an easement would be impermissibly wide. In our view, an easement to use a portion of private land as a backyard is not a valid easement. Such an easement would be too broad and would encompass such a wide range of potential uses as to be incapable of meaningful delineation. As we have seen, in Re Ellenborough Park, Lord Evershed MR observed that the easement of full enjoyment of the pleasure ground equated to a well understood practice of communal passive enjoyment of parks and gardens.[133] Such use is governed by recognised conventions and behaviours that accommodate communal use. That cannot be said about the use of land as a backyard, which is inherently a private space.
[133]Re Ellenborough Park [1956] Ch 131, 168–9.

Ground 3 — the easement amounts to a right to possession

The third ground is that the easement causes an unreasonable and enduring interference with the applicant’s use and enjoyment of his land and that it is unworkable. In essence, the applicant’s contention was that the easement as found amounts to a right to possession in the dominant owner. Again, it is not strictly necessary for us to decide ground 3 but it is desirable to do so because of its connection with ground 2. We propose to consider this ground on the basis, contrary to our conclusion on grounds 1 and 2, that an easement arose in the terms found by the judge. That is an easement for recreation, storage of firewood and burning green waste.

The applicant submitted that the parties’ wish to use the disputed land would inevitably overlap, and that the dominant owner would be required to vacate the disputed land whenever the servient owner came onto that land. By reference to Copeland[134] and Harada v Registrar of Titles,[135] the applicant submitted that the easement effectively gives to the respondent all the rights of exclusive possession and amounts to an impermissible claim of joint user of the disputed land.
[134][1952] Ch 488.
[135][1981] VR 743 (‘Harada’).

The applicant submitted that the easement is inimical to his right to use the disputed land as his own backyard because he, as the owner, cannot use it whenever he likes and leave it in whatever condition he likes. The easement was said to create practical impediments to the applicant using the disputed land for a number of activities that he would otherwise undertake as the owner, including running farm animals, letting out his dogs, and placing furniture or play equipment on the disputed land. The ‘sheer improbability’ of a land owner making an express grant of a right to use his backyard ‘requires one to question how readily a court could infer albeit fictively, that this had occurred.’

The respondent disputed the applicant’s characterisation of the easement as one amounting to joint possession. It was submitted that the applicant and respondent cannot prevent one another from using the disputed land for recreational purposes. The applicant ‘ha[s] much greater rights’ in respect of the disputed land, although he is required to maintain the character of the land as a place of recreation. The respondent distinguished Copeland and Harada on the basis that these were cases in which the servient owner would have been effectively barred from all use of the servient tenement.

It was further submitted that the concept of proportionality had some role to play. As the Queensland Supreme Court explained in Weigall v Toman,[136] this requires consideration of the importance of that part of the servient tenement over which an exclusive right is given to the servient tenement as a whole. In that regard, the respondent noted that the total area of the Laming land is 16,000 square metres, with the area of the easement ultimately granted being only 1,000 square metres.
[136][2006] 1 Qd R 192 [14] (Wilson J).

In response to the applicant’s submission regarding the unworkability of the easement, it was submitted that easements often involve some difficulty in enforcement and that the easement found by the judge was ‘a permissible easement requiring diplomacy’. The respondent also rejected the applicant’s submission that the finding of the easement stretched the fiction of lost modern grant, on the basis that proof that the grant was not made cannot rebut the fiction.[137]
[137]As support for this proposition, the respondent cited Thwaites v Brahe (1895) 21 VLR 192, 198–9 (Madden CJ), Pekel v Humich (1999) 21 WAR 24, 35 [109] (Templeman J) and Chick v Dockray (2011) 20 Tas R 167, 178 [41].

Consideration

Copeland was a case about a putative easement created by prescription to park vehicles on the servient tenement.[138] The plaintiff was the owner of an orchard. Access to the orchard was by a strip of land approximately 150 feet long and of varying width. The defendant was a wheelwright whose premises were opposite the strip of land. The plaintiff sought an injunction to enjoin the defendant from parking vehicles on the strip. The defendant, relying on a lost grant, said that he had the right to use the strip to park vehicles awaiting and undergoing repair and awaiting collection after repair.
[138]Copeland [1952] Ch 488.

Upjohn J rejected the putative easement on the basis that it was not capable of being valid. The judge concluded that the claim went wholly outside any normal idea of an easement and, in substance, amounted to a claim to a joint user of the land. In practical terms, the judge concluded that the defendant claimed the whole beneficial use of the land on one side and that, if upheld, he could leave as many or as few lorries there as he liked for as long as he liked, and could enter and use the land for the purposes of conducting repairs. The judge observed that the claim was ‘virtually a claim to possession of the servient tenement, if necessary to the exclusion of the owner; or, at any rate, to a joint user,’ and concluded that this was not a proper subject matter of an easement.[139]
[139]Ibid 498.

At a general level at least, that proposition may be accepted. However, the cases reveal a very uncertain line between what is permissible and what encroaches too far on the possessory rights of the servient owner. Easements, by their nature, represent a burden on the title of the servient owner. As was said by Lord Scott in Moncrieff v Jemison:

Every servitude or easement will bar some ordinary use of the servient land. For example, a right of way prevents all manner of ordinary uses of the land over which the road passes. The servient owner cannot plough up the road. He cannot grow cabbages on it or use it for basketball practice. A viaduct carrying water across the servient land to the dominant land will prevent the same things. Every servitude prevents any use of the servient land, whether ordinary or otherwise, that would interfere with the reasonable exercise of the servitude.[140]

[140]Moncrieff v Jamieson [2007] 1 WLR 2620, 2640 [54] (‘Moncrieff’).

There are a number of cases, of which Moncrieff is one, in which an easement authorising the dominant owner to park or store goods on the servient tenement has been upheld. Those easements may impact the ability of the servient owner to access those parts of the servient tenement on which the goods are stored. The ability to park vehicles, store coal or trade goods has been authorised by valid easements.[141] As Lord Scott explained, ‘sole use for limited purpose is not … inconsistent with the servient owner’s retention of possession and control or inconsistent with the nature of an easement.’[142] To similar effect, Lord Neuberger observed that a right is not prevented from being an easement simply because, if granted, it would involve the servient owner being effectively excluded from the property.[143]
[141]See Wilcox v Richardson (1997) 43 NSWLR 4, 15 (Handley JA), citing Attorney-General of South Nigeria v Holt [1915] AC 599, 617, Wright v Macadam [1949] 2 KB 744, 752, London & Blenheim Estates Ltd v Ladbroke Retail Parks Ltd [1993] 1 All ER 307. See also J R Gaunt and P Morgan, Gale on Easements (Sweet & Maxwell, 20^th ed, 2017) 35–41 [1-63]–[1-73].
[142]Moncrieff [2007] 1 WLR 2620, 2641 [55].
[143]Ibid 2663 [140].

Harada concerned a proposed easement for the State Electricity Commission to enter upon and clear the relevant land and to lay and erect upon it apparatus and equipment required for the purposes of transmitting electricity, which was expressed as binding the owner not to build any structure or grow trees on the relevant part of the land. King J held that the restrictions proposed went much further than prohibition of interference with the Commission’s rights and that the claimed rights were beyond the common law notion of an easement. Instead, as in Copeland, they were really rights to joint user.[144]
[144][1981] VR 743, 753.

Had we found that the easement was sufficiently certain to be recognised at law, we would not have been persuaded that the easement, properly construed, confers exclusive or joint possession or control of the disputed land on the dominant owner. On that assumption as to certainty, the enjoyment that is conferred on the dominant owner would not be to the exclusion of the servient owner and would not be inconsistent with the servient owner’s possessory rights. The right conferred on the dominant owner to store firewood on the land may limit the servient owner’s ability to access certain parts of the servient tenement, but does not constitute an undue interference with his possessory rights, as the authorities make clear.[145] Similarly, again assuming the easement is otherwise valid, the fact that the servient owner cannot use the land for purposes inimical to the dominant owner’s enjoyment of the easement would be no more than a recognition of the impact of the easement on the owner’s rights otherwise subsisting.
[145]See, eg, Wright v Macadam [1949] 2 KB 744.

Finally, we would add that had we found that the easement was one that gave a right to the owner of the dominant tenement to use the disputed land as his or her backyard, it would be both too wide[146] and would impermissibly confer a right of possession over the disputed land.
[146]As to which see [158] above.

We would reject ground 3.

Ground 4 — s 42(2)(d) of the TLA

The fourth ground relied upon by the applicant relates to s 42 of the TLA, which relevantly provides as follows:

42 Estate of registered proprietor paramount

(1) Notwithstanding the existence in any other person of any estate or interest (whether derived by grant from Her Majesty or otherwise) which but for this Act might be held to be paramount or to have priority, the registered proprietor of land shall, except in case of fraud, hold such land subject to such encumbrances as are recorded on the relevant folio of the Register but absolutely free from all other encumbrances whatsoever, except —

…

(2) Notwithstanding anything in the foregoing the land which is included in any folio of the Register or registered instrument shall be subject to —

…

(b) any rights subsisting under any adverse possession of the land;

…

(d) any easements howsoever acquired subsisting over or upon or affecting the land;

…

notwithstanding the same respectively are not specially recorded as encumbrances on the relevant folio of the Register.

The applicant sought to draw a distinction between s 42(2)(b), which is said to identify ‘immature rights’, and s 42(2)(d) which, it was submitted, preserves only those easements that subsist prior to registration. In the case of an easement by prescription, the person acquires no rights until the relevant 20 year period has passed.

It was submitted that no easement had arisen at the time of the transfer to the Brodies in 1997. That transfer, and the subsequent transfers back to Telstra, effectively re-started the 20 year period. The applicant rejected the suggestion that these transfers can simply be ignored because they were made in error (or to correct an error). It was noted that indefeasibility of title is the defining characteristic of the Torrens system.

The respondent submitted that the trial judge was correct to conclude that the owner of the servient tenement is bound by the acquiescence of those who have preceded him or her. In relation to the operation of s 42, the respondent made two arguments. First, the respondent observed that the doctrine of lost modern grant assumes the existence of a deed that has been lost. The dominant owner proves the existence of the deed after 20 years’ user of the land. On the respondent’s case, the respondent had proved the deed and thereby established that an easement had subsisted over the land since 1986 (or 1991 if time does not run against the Crown). The easement had been preserved in subsequent transfers by s 42(2)(d). In other words, once the 20 year time period had passed, it followed from the legal fiction that at all times during the 20 year period the use had been authorised by a grant, and the Brodies and then, on re-transfer, Telstra took the land subject to the easement that had been acquired by long user.

The respondent’s second, alternative, argument was to the effect that s 42 had no application because there was no encumbrance on title within the meaning of that provision at the time of the transfer of the land to the Brodies or the re-transfers back to Telstra. It was submitted that, until 20 years have passed, no easement arises and there is therefore no encumbrance that is preserved by the operation of s 42 and the question is simply one of use rather than encumbrance on title.

Finally, the respondent submitted that, even if the Court were to reject these two arguments, it should find that, because the transfer to the Brodies was in error, when Telstra resumed ownership it did so subject to the accruing rights of the Howards.

Consideration

This ground raises the uneasy interaction between easements by prescription and the Torrens system of land registration. Although the position is different in some other States,[147] easements by prescription have been upheld in Victoria since at least the decision of the Supreme Court in Nelson v Hughes.[148] The applicant did not contend that Nelson v Hughes was wrongly decided.
[147]Williams (2004) 60 NSWLR 286; Golding v Tanner (1991) 56 SASR 482.
[148][1947] VLR 227.

On the basis of that authority, an easement by prescription may be established where there is long user for 20 years and the necessary degree of acquiescence on the part of the servient owner. The issue raised by ground 4 is whether s 42 of the TLA has the effect that the claim can only be raised against a single registered owner so that a change of registered owner re-starts the relevant 20 year period.

The precise issue has not been the subject of determination by a judge of the Trial Division or by the Court of Appeal. As we have already held that the easement declared by the judge must fail, it is again not strictly necessary for us to determine this ground.

In order to understand how the scope of s 42(2)(d) arises in the present case, it is necessary to set out the legislative context in which that provision appears in the TLA. The relevant parts of s 42 have already been set out. Section 43 provides as follows:

43Persons dealing with registered proprietor not affected by notice
Except in the case of fraud no person contracting or dealing with or taking or proposing to take a transfer from the registered proprietor of any land shall be required or in any manner concerned to inquire or ascertain the circumstances under or the consideration for which such proprietor or any previous proprietor thereof was registered, or to see to the application of any purchase or consideration money, or shall be affected by notice actual or constructive of any trust or unregistered interest, any rule of law or equity to the contrary notwithstanding; and the knowledge that any such trust or unregistered interest is in existence shall not of itself be imputed as fraud.

Section 4(1) of the TLA defines ‘encumbrance’ in respect of any land as including ‘any estate interest mortgage charge right claim or demand which is or may be had made or set up in to upon or in respect of the land’.

As we have already stated, the doctrine of lost modern grant is based on the fiction that, upon completion of the 20 year period of uninterrupted use of land, an easement is deemed to arise at the commencement of that period by virtue of an express grant of easement which has become lost. Where the same person is the registered proprietor of the servient tenement during the 20 year period of uninterrupted use of that land, an easement may be said to be acquired and be subsisting during that person’s ownership of the land and is thus binding on subsequent registered proprietors by virtue of s 42(2)(d).

However, where, as in the present case, the 20 year period of uninterrupted use of the servient tenement is said to be still running when a person becomes the registered proprietor of that land, the question arises whether, notwithstanding that an easement was not in fact in existence at the time of registration, an easement is to be deemed to have been in existence pursuant to a lost grant at the time, prior to registration, that the period commenced. If an easement is deemed to have arisen prior to registration then, for the purposes of s 42(2)(d), it may be said that the easement was subsisting over the servient tenement at the time of registration.

It is readily apparent from the above discussion that ground 4 raises a very difficult question. Complex issues of statutory interpretation, legislative history and the continuing relevance of legal fictions which may conflict with the public policy underpinning the Torrens system are involved. In our opinion, these issues were not sufficiently explored before us to enable us to reach an informed decision on ground 4. Accordingly, we will refrain from expressing a final view on the question raised by that ground until such time as it requires determination in a future case.

Nevertheless, there is utility in identifying some considerations that may inform the resolution of that question.

First, as already noted, there is no authority on the precise issue that has arisen in this case namely, whether, for the purposes of s 42(2)(d), an easement can be held to have been subsisting over a servient tenement at the time a person became its registered proprietor even though the period of 20 years of uninterrupted use was completed after the time of registration.

Secondly, the differences in the wording of s 42(2)(b) and (d) of the TLA might support a different analysis of the circumstances in which an unregistered easement arising from long user binds the registered proprietor of the servient tenement compared to the circumstances in which title by adverse possession binds such a proprietor. The phrase ‘any rights subsisting’ in s 42(2)(b) may more readily be construed as rights that are continuing to accrue through user compared to the phrase ‘any easements howsoever acquired subsisting’. The latter phrase might indicate that an easement must have already crystallised as distinct from continuing to accrue at the time a person becomes the registered proprietor of the servient tenement.

Thirdly, the Torrens system embedded in the TLA is underpinned by a strong policy in favour of the integrity of the public register of land titles. Central to that policy is the indefeasibility of title in ss 42 and 43 of the TLA. The statutory exceptions to indefeasibility require careful analysis to ensure that the scope of those exceptions remains within the intended statutory limits.

Fourthly, the scope of s 42(2)(d) may be informed by its legislative history.

Section 42 of the TLA was previously s 72 of the Transfer of Land Act 1928 (‘1928 Act’). Section 72 did not contain any sub-sections or separate paragraphs. The exceptions to indefeasibility of title in s 72 were contained in a proviso to the section which was in the following terms:

Provided always that the land which is included in any certificate of title or registered instrument shall be deemed to be subject to the reservations exceptions conditions and powers (if any) contained in the grant thereof, and to any rights subsisting under any adverse possession of such land, and to any public rights of way and to any easements acquired by enjoyment or user or subsisting over or upon or affecting such land …[149]

[149]Emphasis added.

The 1928 Act was replaced by the Transfer of Land Act 1954 (‘1954 Act’). Section 72 of the 1928 Act became s 42 of the 1954 Act. In its original form, cl 42(2)(d) of the Transfer of Land Bill 1954 stated ‘any easements acquired by enjoyment or user or subsisting over or upon or affecting the land’. Before the Bill was passed, cl 42(2)(d) was amended by omitting the words ‘acquired by enjoyment or user or’ and substituting the words ‘howsoever acquired’.[150] The wording of the clause became ‘any easements howsoever acquired subsisting over or upon or affecting the land’ and has remained in that form since that time. Although no reasons for the amendment are disclosed in the Parliamentary Debates, it may be inferred that its purpose was to extend the scope of the section to all easements irrespective of how they were acquired.
[150]Victoria, Parliamentary Debates, House of Assembly, 3 December 1954, 2486.

Consideration will need to be given as to whether the above legislative history supports or detracts from the proposition that an easement can be held to be acquired and subsisting even though the 20 year period of uninterrupted use of the servient tenement is completed after a person becomes the registered proprietor of that land.

Fifthly, the doctrine of lost modern grant may operate more unfairly in the case of a person who becomes the registered proprietor of the servient tenement during the period of 20 years of uninterrupted use compared to a person who has remained the registered proprietor for the entire period. This is because the former person has less opportunity to observe the user and take steps to stop it, particularly if he or she becomes the registered proprietor in the last weeks of that period. Consideration will need to be given to case law to the effect that an owner of the servient tenement is bound by the acquiescence of his or her predecessors in title.[151]
[151]See, eg, Auckran v Pakuranga Hunt Club (1904) 24 NZLR 235, 240–1 (Edwards J); Pekel v Humich (1999) 21 WAR 24, 38 [135] (Templeman J); Wayella Nominees Pty Ltd v Cowden Ltd [2003] WASC 210 [230] (Roberts-Smith J).

Sixthly, the historical rationale of legal fictions such as the doctrine of lost modern grant has significantly diminished with the advent of modern systems for the registration of title, comprehensive planning laws and more mature land law jurisprudence.

In Pyrenees Shire Council v Day, Gummow J said ‘the spirit of the times [is] unfavourable to the preservation of legal fictions and hostile to the creation of new legal fictions’.[152] He repeated this statement in Scott v Davis.[153] The statement was quoted with approval by Mason P in Williams.[154] His Honour stated:

[I]t is to pile fiction upon fiction to extend the doctrine of lost modern grant into the Torrens system, because (assuming no relevant exception to s 42 or its equivalents) that system contemplates title at law as arising only upon registration. To transpose the fiction of lost modern grant into a Torrens context one has to presume considerably more than the loss of an executed (and delivered) deed. At the very least, one would have to presume the execution and delivery of a registrable instrument. But logic suggests that one has to go further and presume delivery accompanied by certificate of title, since that is the normal way in which the person entitled to have an interest registered goes about perfecting such title so far as lies in the grantor’s power. Indeed, the title is only perfected through the act of a third party (the Registrar-General), and there is no basis for inferring that officer’s acquiescence in the user giving rise to the common law doctrine.[155]

[152](1998) 192 CLR 330, 387 [163].

[153](2000) 204 CLR 333, 376 [128].

[154](2004) 60 NSWLR 286, 300 [130].

[155]Ibid 300 [129].

Mason P made these observations in the context of s 42(1)(a1) of the Real Property Act 1900 (NSW), which contains a much narrower exception to indefeasibility than s 42(2)(d) of the TLA. The extent to which the observations might bear on the question of construction sought to be raised under ground 4 was not canvassed before us.

Conclusion

We would grant leave to appeal and allow the appeal. We will hear the parties on the form of orders to give effect to these reasons and on the question of costs.

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[2018] VSCA 335

7 December 2018