Lilie Jurleta v Zhong Xing Liu

[2017] NSWSC 1015

Supreme Court

New South Wales

Medium Neutral Citation:

Lilie Jurleta v Zhong Xing Liu [2017] NSWSC 1015

Hearing dates:

21 July 2017

Date of orders:

21 July 2017

Decision date:

21 July 2017

Jurisdiction:

Equity

Before:

Emmett AJA

Decision:

(1) Within 7 days of the date of this order, the Defendant:

 

(a) sign the original of the plans, a copy of which is Exhibit 5, and provide the signed plans to the Plaintiff to enable them to be lodged with Land and Property Information (LPI);

 

(b) produce to the Plaintiff or procure Mr Kiong Low to produce to the Plaintiff, the certificate of title for DP 3/307369; and

 

(c) produce to the Plaintiff or procure Mr Kiong Low to produce to the Plaintiff, the signed transfer creating easement signed on 3 February 2017, a copy of which is Exhibit 6, to enable it to be lodged with LPI.

 

(2) In default of compliance with order 1 above, the Registrar of the Court be authorised to take each of those steps or actions on behalf of the Defendant.

 

(3) The Defendant take all necessary steps required by LPI to enable the easement, the subject of the plans, to be registered on the title.

 

(4) The Defendant pay the Plaintiff’s costs of the proceedings on the ordinary basis.

 

(5) Note the undertaking given on behalf of the Plaintiff that any drain pipe laid in the land subject to the easement will be laid as far as possible 15 centimetres east of the centre line shown on the plans.

 

(6) Liberty to apply on 3 days’ notice in relation to compliance with orders 1 and 3 above.

 (7) The balance of the proceedings be stood over to the Registrar’s list on 30 October 2017.

Catchwords:

REAL PROPERTY – torrens title – easements

Legislation Cited:

Conveyancing Act 1919 (NSW)

Cases Cited:

Nil

Texts Cited:

Nil

Category:

Principal judgment

Parties:

Lilie Jurleta (Plaintiff)
Zhong Xing Liu (Defendant)

Representation:

Counsel:
J Lazarus (Plaintiff)
Z Liu (in person)

  Solicitors:
LP Alidenes & Co (Plaintiff)

File Number(s):

2017/00186963

EX TEMPORE Judgment

1. EMMETT AJA: I have before me a dispute concerning the enforcement of an agreement for the grant of an easement. The plaintiff, Ms Lilie Jurleta, is the owner of a property known as 31 Victoria Street, Ashfield, being the land comprised in identifier 2/977483 (the Dominant Tenement). The defendant, Mr Zhong Liu, is the owner of a property situated at 7 Robert Street, Ashfield, being the land in identifier 3/307369 (the Servient Tenement). The two properties have an adjoining boundary.

2. Ms Jurleta has obtained development consent from Inner West Council (the Council) for the construction of apartments on the Dominant Tenement. A condition of the development consent is that drainage be provided for the Dominant Tenement, in effect, over the Servient Tenement. Following the grant of development consent, Mr Liu and Ms Jurleta engaged in negotiations for the grant of an easement. Those negotiations approached finality towards the end of 2016 and draft agreements were prepared, but finality was not reached.

3. On 12 December 2016, Messrs Kiong Low & Co, the solicitors acting for Mr Liu, wrote to the solicitors acting for Ms Jurleta requesting amendments to a draft agreement for the grant of an easement. Relevantly, Kiong Low & Co said that Mr Liu wanted to have certainty as to particular matters not indicated on existing plans. The three matters he raised were:

1. The length of the easement from Robert Street along the Servient Tenement;

2. The point where the easement terminates on the boundary of the Servient Tenement;

3. To what the pipes in the easement will join; and

4. To what the pipes in the easement will join where they terminate in Robert Street at the other end.

4. There was no evidence of a specific response to that letter. However, apparently instructions were given on behalf of Ms Jurleta for the preparation of a plan in relation to the laying of the proposed drainage pipes in the easement. As a consequence, a document entitled “Storm Water Easement Construction Scope of Works Methodology Plan” dated 25 December 2016 was brought into existence (the Scope of Works Plan). The Scope of Works Plan contains a description of the work to be undertaken in order to lay pipes for the drainage required as a condition of the development consent. The Scope of Works Plan refers to marked-up photographs of the location of the proposed new drainage pipeline. Four photographs are attached on which a red line is marked indicating the proposed position of the new storm water pipeline.

5. The Scope of Works Plan was a colour attachment to an email sent to Kiong Low & Co by the solicitors for Ms Jurleta. There was no evidence of any further negotiation or discussion concerning the terms of the Scope of Works Plan. In any event, each of Ms Jurleta and Mr Liu signed an instrument described as “agreement for easement”, which bears the date 3 February 2017 (the Agreement). By cl 2 of the Agreement, Mr Liu, in his capacity as the registered owner of the Servient Tenement, agreed to grant to Ms Jurleta, as the registered owner of the Dominant Tenement, a 1.2 metre wide easement to drain water.

6. By cl 2(b) of the Agreement, Ms Jurleta agreed to pay Mr Liu consideration in the amount of $60,800, being $60,000 for the granting of the easement and $800 for reimbursement of the cost of a valuation of the diminution in the value of the Servient Tenement by reason of the grant of the easement. Clause 2(c) provided for the consideration to be held in the trust account of Kiong Low & Co whilst the Agreement and the transfer creating the easement were being signed and registered. One half of the consideration was to be paid to Mr Liu on the exchange of counterparts of the Agreement and the signing of the transfer, and the remaining one half of the consideration was to be paid once the transfer creating the easement was registered. Kiong Low & Co were to be responsible for registering the transfer and were also required to serve on Ms Jurleta, or her solicitors, notice of when the transfer was registered. Ms Jurleta gave Kiong Low & Co an irrevocable authority to release the balance of consideration to Mr Liu on service of such a notice.

7. Clause 2(d) of the Agreement provided that the proposed easement would run along the side boundary of the Servient Tenement as described in Annexure A to the Agreement. Annexure A is a copy of the Scope of Works Plan. However, the version of the Scope of Works Plan attached to the Agreement is in black and white, and not in colour as in the case of the version sent to Kiong Low & Co. Nevertheless, it is reasonably easy to discern a line marked on the black and white photographs that corresponds with the red line on the coloured version of the photographs.

8. Clause 2(e) provided that the rights and responsibilities of the easement were to be governed by Pt 3, Sch 8 of the Conveyancing Act 1919 (NSW). The relevant terms of the proposed easement, taken from Sch 8, are set out in cl 2(e).

9. Clause 2(f) of the Agreement provided that, upon registration of the easement, Ms Jurleta was to make prompt application to the Council for the necessary approvals to lay and install the pipeline and other requirements for the purposes of the easement (the Works). Under cl 2(g), Ms Jurleta was to be solely responsible for the costs incurred in the laying and placing of the pipes and in the rectification of the site after the Works had been completed. Under cl 2(h), Ms Jurleta was to be responsible for the costs of inspecting, cleansing, repairing, maintaining and renewing the pipeline, and agreed to indemnify and keep Mr Liu indemnified against all claims in relation to the Works, provided that he was not in any way responsible for damage to the pipes.

10. Clause 10 of the Agreement provided that Ms Jurleta would pay Mr Liu’s reasonable costs and disbursements in relation to the Agreement and to the registration of the transfer creating the easement. On 3 February 2017 the sum of $3,905 was paid to Kiong Low & Co in payment of Mr Low’s fee note of 1 February 2017 for that amount, being for his costs of acting for Mr Liu in relation to the grant of the easement.

11. On 2 February 2017 the sum of $60,800 was paid into the trust account of Kiong Low & Co, as contemplated by cl 2(b) of the Agreement. In accordance with the Agreement, a form of transfer creating the easement was signed by both parties and was entrusted to Kiong Low & Co. Sometime thereafter, Kiong Low & Co lodged the transfer and other documents, including a plan intended to identify the location of the proposed easement.

12. However, on 16 February 2017, Land and Property Information (LPI) raised requisitions in relation to the proposed registration of the easement. The requisitions were directed to Kiong Low & Co as the lodging party. Specifically, the requisitions related to a requirement for the lodging of a compliant plan. The plans lodged in connection with the transfer apparently did not meet the requirements of the regulations.

13. On 21 February 2017, Mr Low of Kiong Low & Co sent an email to Ms Jurleta’s solicitors saying that he had withdrawn his services to Mr Liu. He explained in the email the difficulties that he had had in that regard that caused him to cease to act. On 16 March 2017, Ms Jurleta’s solicitors sent an email to Mr Liu telling him that LPI had required a compliant survey plan to be prepared. The email said that the plan was required to conform with what was agreed in the Agreement and that a surveyor would need to measure on site to ensure that the plan was what was agreed. The email contained a request that the surveyor be allowed to measure on site in the following week.

14. On 17 March 2017, Ms Jurleta’s solicitors sent another email to Mr Liu attaching a copy of the Agreement, the signed transfer creating the easement and the requisitions from LPI. The email said that the surveyor would need to replicate the plan in the Agreement in the form required by LPI.

15. It appears that access to the Servient Tenement was given and survey plans were prepared by the surveyor in the form required by the regulations and LPI. On 12 April 2017, Ms Jurleta’s solicitors wrote to Mr Liu enclosing the survey plans, saying that they were needed to finalise the registration of the easement. The plans had already been signed by Ms Jurleta and the letter asked Mr Liu to sign alongside Ms Jurleta’s signature on each page and return the documents.

16. On 19 April, Ms Jurleta’s solicitors sent another email to Mr Liu, noting that he had taken delivery of the plans for registration. The email required the plans to be signed and returned to the solicitors by 27 April 2017.

17. On 28 April 2017, Messrs Birch Partners, solicitors, wrote to Ms Jurleta’s solicitors saying that they now acted for Mr Liu. The letter said that Mr Liu’s sewer pipes were currently located within the proposed easement site and asked for the easement documents to be amended to reserve certain rights for Mr Liu and future registered proprietors, as follows:

1. The owner of the Servient Tenement was to have the right to leave the existing sewer pipes on the Servient Tenement in their current location;

2. The owner of the Servient Tenement was to have free access to the easement site to enable the owner to repair, maintain or replace the existing sewer pipes; and

3. The proposed storm water pipes were to be laid adjacent to and not on top of the existing sewer pipes in the area of the proposed easement.

18. Birch Partners asked for Ms Jurleta’s solicitors to obtain instructions and provide amended documents for approval and execution.

19. However, in circumstances not explained, Birch Partners ceased to act and informed Ms Jurleta’s solicitors of that fact on 23 May 2017. On the same day, Ms Jurleta’s solicitors sent another email to Mr Liu saying that they had been notified that Birch Partners were no longer representing him. The email noted that the plans had not yet been signed and returned, and that no explanation or offer had been made. The letter said that if the plans were not signed and returned by 26 May 2017 Ms Jurleta would have no option but to bring proceedings in the Supreme Court to enforce the Agreement. The letter said that they would be seeking costs on the indemnity basis.

20. These proceedings were commenced by summons dated 22 June 2017. Application was made for expedition on the basis that, unless the conditions of the development consent are satisfied by a date in the near future, the consent will lapse. The matter was listed for hearing before me today.

21. I had previously conducted a directions hearing to satisfy myself that the proceedings were ready for hearing and would be ready to proceed today. On that occasion Mr Liu appeared in person with the assistance of his daughter. His daughter seems to be very competent in the English language, although Mr Liu appears to have very limited, if any, knowledge of the English language. At that stage, Mr Liu informed the Court, through his daughter, that he proposed to have legal representation at the hearing. However, when the matter was called on for hearing today, Mr Liu appeared without legal representation. He was assisted by his daughter and by an interpreter who appeared to have no difficulty in communicating what was said in court to Mr Liu and in understanding what Mr Liu said in response.

22. Mr Liu indicated that he had made efforts to obtain representation, but that no lawyer whom he approached was prepared to accept instructions on short notice. Be that as it may, Mr Liu indicated that he was content for the matter to proceed to hearing today.

23. The basis upon which the orders sought by the plaintiff are resisted seems to be two-fold. First, it was said that the photos annexed to the Scope of Works Plan were too imprecise and were not in colour. Secondly, Mr Liu raised the question of the sewer pipes in the Servient Tenement. A third matter that was raised on behalf of Mr Liu concerned certain costs.

Uncertainty

24. I accept that Kiong Low & Co may not have passed on to Mr Liu the colour version of the Scope of Works Plan showing the proposed site of the pipes in red. However, there was no suggestion that a complaint was made, at the time when the Agreement was signed, that the location of the proposed pipes was in any way doubtful or that there was any doubt as to the proposed location of the easement. On an examination of both the black and white and the colour photographs, it is apparent that the location marked on the photographs accords precisely with the location of the proposed easement as shown on the plans that were forwarded to Mr Liu for signature.

25. I invited Mr Liu to indicate the respect, if any, in which he says that the plans that he was asked to sign do not conform with the requirements of the Scope of Works Plan. He could not point to any discrepancy.

26. Clearly, it would have been desirable for a surveyor’s plan to have been prepared and annexed to the Agreement. However, I do not consider that there is any uncertainty in the language of the Agreement or of the Scope of Works Plan as to the intended location of the proposed easement and the drainage pipes to be constructed within the easement. Accordingly, there does not appear to be any substance in the first objection to the making of orders requiring the performance of the Agreement.

Sewer Pipes

27. In response to Mr Liu’s concern about sewer pipes, Ms Jurleta, through her counsel, proffered an undertaking that any drain pipes laid in the Servient Tenement would be laid, as far as possible, at least 15 centimetres east of the centre line shown on the survey plans. That undertaking, as I understand it, satisfies Mr Liu’s concern that there might be some conflict between the existing sewer pipe and the proposed drainage pipe.

28. It may be that Mr Liu is under some misapprehension as to the effect of the grant of the proposed easement. There is no change in the ownership of the land that is subject to the easement. The precise terms of the easement are taken from the language of the relevant schedule to the Conveyancing Act and are set out in the Agreement. There is nothing in the terms of the easement that would prevent Mr Liu from attending to his own sewer pipes, so long as he did not, in doing so, interfere with the free flow of water in the drainage pipes to be constructed by Ms Jurleta. I do not see any basis for the concern on the part of Mr Liu. In any event, that is a matter that should have been raised in the negotiation for the grant of the easement.

Costs

29. As I have said, the Agreement provided that Ms Jurleta would pay Mr Liu’s reasonable costs and disbursements in relation to the Agreement and the registration of the transfer creating the easement. As I have said, the sum of $3,905 has already been paid in relation to those costs. There is no evidence before me that any other costs have been incurred that might fairly be described as relating to the Agreement or to the registration of the transfer creating the easement.

30. It appears that Mr Liu’s concern is that he has consulted solicitors, presumably Birch Partners, and has incurred costs in relation to interpreter’s fees in connection with these proceedings. I do not consider that they are costs in relation to the Agreement or to the registration of the transfer. Any costs reasonably incurred by Mr Liu in relation to the performance by him of the Agreement, to the extent they are over and above those for which Kiong Low & Co has been paid, would be the responsibility of Ms Jurleta. However, the costs incurred by reason of the failure to perform the Agreement in resisting the litigation are not costs that in any view fall within cl 10 of the Agreement. Failure to pay those costs is therefore not a bar to the grant of an order effecting specific performance of the Agreement.

Conclusion

31. In all of the circumstances I am satisfied that Ms Jurleta is entitled to orders effecting specific performance of the Agreement. I therefore propose to make orders in the following terms:

1. Within 7 days of the date of this order, the Defendant:

1. sign the original of the plans, a copy of which is Exhibit 5, and provide the signed plans to the Plaintiff to enable them to be lodged with Land and Property Information (LPI);

2. produce to the Plaintiff or procure Mr Kiong Low to produce to the Plaintiff, the certificate of title for DP 3/307369; and

3. produce to the Plaintiff or procure Mr Kiong Low to produce to the Plaintiff, the signed transfer creating easement signed on 3 February 2017, a copy of which is Exhibit 6, to enable it to be lodged with LPI.

2. In default of compliance with order 1 above, the Registrar of the Court be authorised to take each of those steps or actions on behalf of the Defendant.

3. The Defendant take all necessary steps required by LPI to enable the easement, the subject of the plans, to be registered on the title.

4. The Defendant pay the Plaintiff’s costs of the proceedings on the ordinary basis.

5. Note the undertaking given on behalf of the Plaintiff that any drain pipe laid in the land subject to the easement will be laid as far as possible 15 centimetres east of the centre line shown on the plans.

6. Liberty to apply on 3 days’ notice in relation to compliance with orders 1 and 3 above.

7. The balance of the proceedings be stood over to the Registrar’s list on 30 October 2017.

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Decision last updated: 02 August 2017