Lim Group Holdings Pty Ltd v Paragreen
[2018] VCC 1677
•24 October 2018
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMERCIAL DIVISION | Revised Not Restricted Suitable for Publication |
GENERAL LIST
Case No. CI-17-00007
| LIM GROUP HOLDINGS PTY LTD (ACN 074 598 646) | Plaintiff |
| v | |
| MICHAEL ANDREW PARAGREEN | First Defendant |
| and | |
| JUSTINE KIMIKO PARAGREEN | Second Defendant |
---
JUDGE: | HIS HONOUR JUDGE MACNAMARA | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 19, 20, 21, 24, 25 September 2018 | |
DATE OF JUDGMENT: | 24 October 2018 | |
CASE MAY BE CITED AS: | Lim Group Holdings Pty Ltd v Paragreen and Anor | |
MEDIUM NEUTRAL CITATION: | [2018] VCC 1677 | |
REASONS FOR JUDGMENT
---
Subject:Property Law
Catchwords: Real property; registered easement of carriageway; extent of dominant tenement owner’s rights; whether entitled to object to locked gateway on carriageway; to which land appurtenant; whether carriageway may be availed of for benefit of land other than dominant tenement; whether easement by lost modern grant established; restrictive covenant; whether terms of settlement between plaintiff and previous owner of servient tenement as to parking of vehicles enforceable against current owners as restrictive covenant.
Legislation Cited: Transfer of Land Act 1958, s72; Subdivision Act 1988, s24(2)(d); Property Law Act 1958, s79; Real Property Act 1900 (NSW), s42, s43; Sale of Land Act 1962, s32
Cases Cited:Westfield Management Limited v Perpetual Trustee Company Limited (2007) 233 CLR 528; Kyren Pty Ltd v Cinema Place Pty Ltd [2004] SASC 268; National Trust for Places of Historical Interest or Natural Beauty v White [1987] 1 WLR 907; Grinskis v Lahood [1971] NZLR 502; Jones v Pritchard [1908] 1 Ch 630; Biki v Chessells [2004] ANZ Conv R 296; Boglari v Steiner School and Kindergarten (2007) 20 VR 1; Bulstrode v Lambert [1953] 1 WLR 1064; Laris v Lin (No 2) [2016] NSWSC 560; Chiu v Healey [2003] NSWSC 857; Butler v Muddle (1995) 6 BPR 97; Bond and Leitch v Delfab Investments Pty Ltd (1980) 26 SASR 462; Pattison & Stephens [2015] VCC 1423; Trewin v Felton [2007] NSWSC 851; Fitzgerald v Masters (1956) 95 CLR 420; Toohey v Gunther (1928) 41 CLR 181; Bahr v Nicolay (No 2) (1988) 164 CLR 604; Body Corporate No 12870 v Aldal Pty Ltd [2010] VSC 366
Judgment:(1) Within fourteen (14) days, the parties must bring in short minutes to give effect to these reasons.
(2)Costs reserved.
---
APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr J K Arthur | Ellinghaus Weill Lawyers & Consultants |
| For the Defendants | Mr S V Palmer | Boris Pogoriller Solicitor |
HIS HONOUR:
Background
1 This proceeding concerns a dispute between neighbouring landowners in Walsh Street, West Melbourne, as to their respective rights and liabilities relative to an easement of carriageway created in 1873.
2 The principal of the plaintiff company is Mr Lim Tong Leong, known in English-speaking circles as Mr Leong Lim. He is an architect by training, holding degrees in Architecture and Town Planning, as well as a Bachelor’s Degree in Computer Science. He was born in Malaysia, spending some of his time there and some in Australia. He has worked on a variety of major projects in Australia and Malaysia as an architect, and in other capacities. (Transcript (“T”) 106-108)
3 By Contract dated 13 June 1996, the plaintiff company, as Mr Lim’s nominee, purchased the property at 42-52 Walsh Street, West Melbourne, from Challenge Bank Ltd as mortgagee. (Court Book (“CB”) 88-105) The property was comprised in some four Certificates of Title: Volume 8040 Folio 302, Volume 7009 Folio 773, Volume 8609 Folio 873, and Volume 2912 Folio 361. (CB 650-655, 713-719) At that time, according to Mr Lim:
“The property was … it wasn’t tarmac, it was just gravel. There was a small gate at the front, it was one of those Wilson Parking type situations.”
(T111, Line(s) (“L”) 17-20)
4 Mr Lim said that the property had a permit for the erection of an eight-storey multi-unit development, but his company “didn’t have the financial resources” to carry out that development. (T111, L21-27) The development which his company ultimately erected included some sixty rooms, built over a period of time. (T111, L30-31)
5 Immediately to the east of this property was a property known as 38 Walsh Street. The most easterly of the four allotments forming part of the complex, comprised in Certificate of Title Volume 2912 Folio 361, had the advantage of a right of way running the full depth of the title: north from Walsh Street to the boundary of another property facing Rosslyn Street, West Melbourne. In the old measurements, this right of way was some 9 feet in width. It traversed land comprised in the title to the adjacent property at No 38 Walsh Street. (CB 652-656) The right of way was comprised in Certificate of Title Volume 10359 Folio 486.
6
From 1997, this parcel subject to the right of way was vested in PMP Property Pty Ltd, apparently a property-owning company of the Pacific Publications Group, which until recently was a major property holder in the area.
(CB 660-1) Concurrently, PMP Property Pty Ltd became the owner of the property immediately to the east of the right of way: Certificate of Title Volume 10359 Folio 500. (CB 667-8) The right of way allotment comprised in Certificate of Title Volume 10359 Folio 486 was in that title depicted as having a width of 2.74 metres and being subject to an easement:
“… created by a conveyance dated 11/6/1860 from William Sturgess to Henry Charles Registered Book 94 Number 883.”
[This is apparently a reference to the registry of memorialised deeds kept under Part 1 of the Property Law Act 1958].
7 The property immediately to the east of the right of way was occupied by the Pacific Publications Group. (T113, L29-30) Erected on this land was a brick building which was being used by Pacific as a warehouse. (Ibid, L13-14) To Mr Lim’s observation, “There was quite a lot of traffic going up and down [the right of way].” (Ibid, L14-15) Some of the traffic used this right of way to reach an open parking area which then existed immediately to the north of the right of way, on land fronting Rosslyn Street. (T115, L22 – T116, L2)
8
Commencing the first stage of the plaintiff’s development of 48-52 Walsh Street, its contractors trimmed the levels and constructed footings. (T116,
L9-17) The preliminary excavations uncovered stone footings, apparently the remains of buildings which had previously existed on the site. (T117, L24-25) The plaintiff’s contractors used the right of way to access 48-52 Walsh Street by travelling north from Walsh Street and exiting at the northern corner. (T118, L2-6) Access to the development site, 48-52 Walsh Street, was from the Walsh Street frontage or from the side abutting the right of way. (Ibid, L21-22)
9 The development by Lim Group Holdings was for student accommodation. It was designed by Mr Leong Lim following consultation with the housing officer of RMIT University. (T110, L2-13)
10 During this initial phase of construction, the plaintiff made extensive use of the right of way “because it was ... already a prepared surface and traffic on it was easy, so the contractors would prefer to use it rather than going through a muddy route ...” (T120, L32–T121, L3) There was a gateway at the northern end of the right of way, which at this period was customarily open, and Lim Group Holdings availed itself of that access. (T121, L28-31) Whether access was had by the right of way or from Rosslyn Street was merely a matter of convenience. (T122, L19-26) The right of way was used for concrete pours, which took about 10-15 minutes. (T123, L1-15)
11 On 25 September 2000, the right of way and the factory/warehouse block were transferred to the proprietorship of Judisco Pty Ltd. (CB 661, 668) When Judisco took up occupation of the factory/warehouse, according to Mr Lim, customarily six to seven cars belonging to its employees were parked throughout the day on the right of way. Lim Group Holdings commenced proceedings in this Court against Judisco, which were resolved by a settlement agreement dated 28 May 2008 which provided, inter alia, that Judisco would cease parking cars on the right of way. (T156, L14-31)
12 By contract dated 26 June 2009, Judisco sold the right of way and the factory/warehouse to a property developer, Mr Michael Ryan. Following his purchase, he lodged an application for a redevelopment and subdivision of the two properties. Mr Lim, on behalf of his company, inspected the plans of the proposed subdivision and redevelopment, and concluded “there were quite a number of design issues that ... I perceived as an architect, as well as [an] adjoining land owner, that I had issue with”. (T157, L14-24)
13 Melbourne City Council, as responsible authority, issued a notice of determination to grant the permit. (Ibid, L25-30) Lim Group Holdings sought review of that determination from the Victorian Civil and Administrative Tribunal. According to Mr Lim, “VCAT accepted that the ... development proposal, the subdivision of it and a conversion of a warehouse to a residential was okay”. What Lim Group Holdings “took issue with” was “the fact that Ryan had ... designed what we considered to be garages in the two units that ... just wouldn’t work”. There were also issues as to the design of light shafts, the location of planter boxes, and so on. (T158, L1-15)
14 The review application came on for hearing on 28 April 2010. Mr Lim represented his company. The tribunal member, Ms Bensz, directed modifications to the proposed plans, requiring the dimensions of the garage to be at least 5.4 metres with an aisle width of 4.8 metres. She directed:
“The vehicle access is reasonably achievable to the garage of dwelling 3. The submission of turning circle diagrams may aid in demonstrating that reasonable access is possible.”
15 What was described as “dwelling 3” was a proposed new structure to the north of and behind the existing warehouse/factory at 38 Walsh Street, including within its allotment the most northerly portion of the right of way. Ultimately, however, Mr Ryan elected to delete the proposed garage from Unit 3. (T159, L24-26) This was approved by way of a secondary consent given by the Melbourne City Council as responsible authority, without further reference to the tribunal. (CB 163-165)
16 Consequently, when Plan of Subdivision PS601870T was registered, affecting the two titles previously owned by PMP, the right of way from Walsh Street north, 18.52 metres, was allocated as common property to the subdivision. What are described as Units 2 and 3 - that is, the two units closest to Walsh Street - abutted the right of way/common property, with vehicle garages accessed from this right of way. The northernmost portion of the right of way, running south from the rear boundary toward Walsh Street, 9.68 metres, formed part of Unit 1 on the Plan of Subdivision. Perhaps confusingly, this has been referred to as “Unit 3” as it was in the course of the disputation before VCAT. This property is now in the ownership of Mr and Mrs Paragreen, the defendants in the proceeding.
17 The easternmost strip of this land, to a width of 2.74 metres [viz a conversion of 9 feet from the old Imperial system], is, according to the Plan of Subdivision, affected by some three easements, designated E‑1, E‑2 and E‑3. (CB 672) In the legend for the Plan of Subdivision at CB 671, E-2 is described as a carriageway easement created by instrument 31414. The easement, created by a document styled ‘Creation of Easement’ dated 31 May 1873 [therefore not the 1860 easement memorialised under the general law system and referred to on the face of the title to the right of way previously held by PMP], is found at CB 682. The instrument stated:
“We hereby transfer to the said Elizabeth Rogers and grant to her her transferees in fee simple full and free right and liberty to and for her and the proprietor or proprietors for the time being of all that piece of land being part of allotment ten of Section HB Melbourne parish of North Melbourne County of Bourke and more particularly described in the Certificate of Title entered in the Register Book Vol 66 folio 13170 or any part of parts thereof and their tenants servants agents tradesman and visitors to go pass and repass at all times hereafter and for all purposes and either with or without horses or other animals carts or other carriages into and out of and from the said land or any part thereof through over and along all that piece or parcel of land being part of Crown Allotment ten of section HB “Melbourne” parish of North Melbourne County of Bourke more particularly described in the Certificate of Title entered in the Register Book Vol 583 Folio 116531 which pieces of land are delineated as to the first part above described piece of land Red and as to the last part above described piece of land Brown on the plan.”
18 This registered easement is shown as appurtenant to Certificate of Title Volume 2912 Folio 36 - that is, the most easterly of the four Certificates of Title purchased and redeveloped by Lim Group Holdings.
19 Meanwhile, the plaintiff’s land had been redeveloped in two stages. The second stage, which entailed structures built to the easterly boundaries at the northern or rear portion, was completed in 2004. (T127, L4-15) This rear area had previously been used as a garden. (T126, L5-18) The ground floor of the front portion of the buildings had been used as a childcare centre (presumably a trading enterprise) for Mr Lim’s daughters. (T125, L29-T126, L1) This childcare centre apparently ceased operation in 2001. (T251, L16-18)
20 By Contract of Sale dated 4 June 2011, Mr and Mrs Paragreen purchased Unit 1, or dwelling 3, the northernmost unit in the subdivision of 38 Walsh Street, from Mr Ryan. (CB 171 ff) That Contract of Sale included the vendor statement made by Mr Ryan under s32 of the Sale of Land Act 1962. That statement annexed a series of certificates and pieces of information as to rates, planning matters relative to the subdivision, and so on, as well as the terms of settlement entered into on 28 May 2008 between the plaintiff, Lim Group Holdings Pty Ltd, and Judisco Pty Ltd. (CB 194-196)
21 Despite the contracts being drawn for use at an auction, the sale was made by private treaty on a Friday. The Paragreens signed the contract showing a price of $741,000, but, upon Mr Ryan’s declining to agree to that price, it was subsequently amended to a price of $750,000. (T157, L1-13) This unit had been advertised as including one car-space. (CB 721-2) An online report of the sale also identified Unit 3 as a “townhouse” sold for $750,000 featuring one car-space.
22 The Paragreens moved into the townhouse in August 2011. (T283, L28-30) The Paragreens’ eldest child was born in November 2012, and they continued to live in the unit until Mrs Paragreen took up a job offer in the Latrobe Valley and the family relocated to the Latrobe Valley from March 2014 to March 2016, with tenants occupying for some two years. (T284, L1-9)
23 When the Paragreens moved in, the right of way was to all appearances as it had been for many years: simply an open laneway. There was no designation of the boundary between the common property driveway as part of the 38 Walsh Street subdivision and the northern portion of the right of way which was allocated as the separate property of No 3.
24 Mrs Paragreen said that there were a number of intrusions and attempted break-ins, in particular one in January 2013. (T284, L10-T285, L31) According to Mr Paragreen, this was a typical inner-city suburban area with nearby hotels and entertainment venues, creating security issues. In addition, their eldest child, Harry, is now “five going on six”, with a second son born in June 2016. (T206, L7-22). They wished to have a secure playing area for their children. (T287, L3-4). As a result, the Paragreens erected a gate inset two or more metres from their southern title boundary across the right of way. It was constructed in two stages: first a frame, and then the gates themselves.
25 This led to communication with Mr Lim’s younger brother, Mr Sim Lim, who is the plaintiff’s property manager. Mrs Paragreen said she explained the rationale for the gate, namely a concern for the security of the Paragreens’ two young children. Mr Sim Lim asked if this gate should be regarded as permanent or temporary, and suggested that the Paragreens might obtain legal advice. Mrs Paragreen said there was no plan to take down the gate. He replied, according to her account:
“[T]he Lim Group’s long-term developments plans, ... would most likely include a multi-storey apartment building, and would most likely include an underground car-park that would enter at the rear of the Lim Group property, so outside our front door. He said that the Lim Group would probably consider allowing us to leave the gate for the short to medium term ... ‘By the time your child’s sort of old enough and of age’, and that if I put it in writing that it was going to be a temporary structure, that it would be removed when they got planning application to put an underground car-park at the rear. And that if I write in the letter that I waive my rights to object to any future planning application, that they would most likely allow me to keep the gate. He did explain that his superior [viz Mr Leong Lim] was away for business at the time and would be back, and they would consider my letter when he got back. I never ended up writing that letter. … .”
(T290, L1-20)
26 Mrs Paragreen declined to waive any entitlement to objection in the planning process. (T290, L27-31)
27 With the gate erected and the Paragreens back in residence with two young children, they placed a chicken coop, with first four and then three chickens in it, and some children’s play equipment, on the area north of the gate affected by the right of carriageway. (T292) She said, “The chickens were really our pets”. (T292, L28)
28 Asked about evidence which Mr Sim Lim had given as to complaints from Lim Group Holdings’ tenants about the chickens generating a foul odour, Mrs Paragreen denied this. (T293)
29 There then followed letters of demand from solicitors acting for the plaintiff. Lim Group Holdings filed a writ in the Supreme Court seeking a raft of relief against the Paragreens on 25 November 2016. That proceeding has since been transferred to this Court. The most recent version of the Statement of Claim is dated 6 August 2018. (CB 19 ff) It was the subject of lengthy argumentation before Judicial Registrars in this Court.
30 The most recent formulation of the relief which the plaintiff seeks is to be found in a document dated 20 September 2018. That relief is as follows:
“In addition to the relief sought in the Statement of Claim, the Plaintiff seeks a declaration that the Plaintiff and its successors in title by reason of the relief claimed in paragraph A of the Prayer for Relief is entitled to:
(i) carry out maintenance and improvements to the Lim Property from the Laneway and the Laneway Area, including those referred to in particular B to paragraph 20 of the Amended Statement Claim, painting its building, installation of windows, exhaust fans, maintenance of its walls, windows, water heaters, cleaning the guttering and repairing roofs (and especially those facing the Laneway), with necessary tradesmen, vehicles, scaffolding, necessary safety or work safe barriers, and machinery as required using the Laneway for any such purposes;
(ii) pedestrian and vehicular access to the Lim Property from the Laneway by the Lim Gate and any other future gates, being its doorway in the eastern wall of the Lim Property;
(iii) access to the Lim Property from the Laneway by the Lim Gate and any other future gates, being its doorway in the eastern wall of the Lim Property for the purposes of stopping, loading and unloading vehicles with inter alia groceries, furniture, building materials, appliances, goods, rubbish and supplies for use in its property management and development business and for the purposes referred to in sub-paragraph (i) hereof;
(iv) its servants and/or agents, electrical contractors and authorities accessing the Main Switchboard of the Lim Property which is situated near the south west corner of its building just north of the southern edge of the Laneway on its western side or any future possible location of such services as approved by the responsible authority;
(v) its servants and/or agents, accessing its garbage wheely bins located in a recess in its building just to the north of the Main Switchboard or any other future location of such storage alcoves as approved by the responsible authority which it has done so since the initial construction of the building on the Lim Property in 1996.
(vi) reasonable and unobstructed access of the Right of Way for the purposes of access only (not parking) during the demolition and subsequent construction phase of any further development of its property.”
Cul de sac or throughway?
31 Paragraph 31 of the outline of closing submissions on behalf of the plaintiff, Lim Group Holdings, stated:
“It is evident that prior to the Plaintiff [that is Lim] owning the Land and not until the time of Judisco the laneway allowed access to Rosslyn Street. Apart from this it is assumed it was used for night carts.”
32 I pressed plaintiff’s counsel, Mr Arthur, for an explanation of the purport of this sentence. Mr Palmer, on behalf of the defendants, had placed some reliance upon the fact that the area of the right of way comprised in the defendants’ property was the end of a cul de sac. Mr Arthur said that I should take judicial notice of the way night cart lanes were used in inner Melbourne. Despite this explanation, I remained unclear as to exactly what was being contended.
33 What I can say is that, to the extent that any sort of prescriptive entitlement is being relied upon, something to which I will turn in some detail below, the long user period necessary to be demonstrated is a period of twenty years.
34 According to Mr Leong Lim, the gate at the northern end of the right of way was frequently, and perhaps customarily, open when the plaintiff’s complex was under construction. Since then it has been customarily closed.
35 Had I realised that the point in question was to be urged in final submission, I would have paid particular attention, on the view which was conducted on the first day of the hearing, to the present state of affairs; in particular, to what was on the other side of the now apparently permanently-locked gate. Mr Palmer said in submissions on a number of occasions, without any contradiction, that the other side of the gate had a sign ‘Private Property’ on it. Mr Leong Lim’s evidence as to the situation during the construction phase was that the site fronting Rosslyn Street was a car park used by Pacific Publications. My impression at the time of the view was that some kind of residential unit development was erected on the site now, and that there was extensive car parking associated with it.
36 The upshot is that the evidence on the subject is quite unclear. Certainly there is nothing which could make good any kind of twenty‑year-long user. It was not made clear to me what I should take judicial notice of. Whatever it might be, in the circumstances I am not satisfied that anything is so notorious that it could bring certainty to this uncertain situation.
37 The burden of proof on these matters lies on the plaintiff. That burden has plainly not been discharged. Accordingly, I will treat this right of way as it seemed to be treated for most of the trial and most of the final argument: as being a cul de sac.
Lost modern grant
38 Mr Arthur placed reliance not only upon the easement registered as an encumbrance upon the defendants’ title and what might be taken to be implied in the terms of that easement, but also upon an easement right obtained by prescription. This was not mentioned in his opening. Had I appreciated that reliance was being placed upon a prescriptive easement, I would have sought clarification upon a number of points in the evidence of the Messrs Lim and elaborations upon some of the other points.
39 The parties filed a document styled ‘Statement of Issues’ prior to the commencement of trial. The formulation of this document by agreement between counsel was time-consuming and difficult. (T77-78) As to this document, it referred to the registered 1873 easement, potentially an easement arising under s72(3) of the Transfer of Land Act 1958 or s24(2)(d) of the Subdivision Act 1988, and no other easements or potential easements.
40 In their defence to paragraph 20 of the plaintiff’s Amended Statement of Claim, the defendants denied the allegations by Lim Group Holdings that their erection of the gate was a substantial and unreasonable interference with the plaintiff’s right of carriageway or a breach of the plaintiff’s entitlement under the Subdivision Act or s72(3) of the Transfer of Land Act. They said that the gate did not prevent Lim Group Holdings from gaining access to and from its land, continuing:
“Further they say that there is no purpose or utility for any person to enter into that part of the Defendants’ land to the north of the gate in any event. There is and at all material times has been a fence at the northern boundary of the Defendant’s [sic] land which was erected by the owner of the adjoining land and as a result of which there is no access beyond the northern boundary of the Defendant’s (sic) land.”
41 By way of reply, Lim Group Holdings, in clause 20(b) of its Reply, said that:
“[T]he presence of the Gate prevents it from enjoying the Right of Carriageway as granted, inter alia, as set out in the particulars to paragraph 20A, B and C of the ASC [viz the Amended Statement of Claim] ... which it is has duly and openly exercised, and it was and is entitled to do, without the permission of the Defendants, or their predecessors in title, since its purchase of the Lim Property in 1996.”
42 The only easement or potential easement referred to in paragraph 20 of the Amended Statement of Claim is the “Right of Carriageway” which is defined in clause 7 thereof as the registered 1873 easement.
43 In clause 20(c) of the Reply, Lim Group Holdings says further, or alternatively:
“[B]y its use of the Laneway since its purchase of the Lim Property in 1996 and otherwise, it has full right to enjoy the Right of Carriageway in accordance with its terms, or further, or in the alternative, it has an implied right to stop, load and unload, or further, or in the alternative, a right, or implied right, to use the Laneway, for each of the purposes set out in the particulars A, B and C to paragraph 20 of the ASC. … .”
44 In the particulars to this subclause, Lim Group Holdings refers to a number of uses to which it has put the “laneway” since its purchase in 1996, numbered (i) to (v). This analysis, it will be seen, since it ultimately proceeds from what is defined in the Amended Statement of Claim as the “Right of Carriageway”, restricts itself to the registered easement. It does not, as it seems to me, invoke any species of easement by lost modern grant separate from the registered easement.
45 I was dismayed by Mr Arthur’s raising the doctrine of lost modern grant at so late a stage in the proceeding. Mr Palmer, however, did not unequivocally object to my consideration of the matter.
46 As I put to Mr Arthur, the doctrine of lost modern grant can only be of relevance to the extent that reference to it could invoke some more extensive right in favour of the plaintiff than the plaintiff enjoys as against the defendants under the present registered easement, either as to the range of activities on the servient tenement which it might authorise or as to the land which it might benefit. To the extent that rights for a particular parcel of land are already subsumed in a registered easement, the law would have no occasion to resort to the fiction of lost modern grant.
47 Under the common law, an easement could be regarded as having been acquired if it had been freely and openly exercised since time immemorial. As the editors of Bradbrook and Neave’s Easements and Restrictive Covenants (3rd ed, 2011) note:
“Under this method of acquisition, a prescriptive easement will arise if user of the right over the alleged servient tenement dates from the time of legal memory. This was fixed by the Statute of Westminster 1275 as 1189, the year of accession of Richard I.”
[5.6] 131-2
48 According to Bradbrook and Neave:
“The doctrine of lost modern grant was developed by courts in order to allow claims based on long enjoyment without the necessity of proving user since 1189. The essence of the doctrine is that a grant will be presumed by the courts to have been made and lost in modern times if enjoyment of the alleged easement for 20 years can be proved.”
[5.7] 132
49 Mr Arthur noted that, according to the learned editors:
“The user required to support a prescriptive claim need not be certain and uniform in its extent and nature throughout the prescriptive period.”
[5.16] 137
50 The learned editors in the balance of that paragraph refer to instances where the extent of the alleged prescriptive use has varied or increased over time. Beyond the assertion of enjoyment of certain rights since 1996, the period of the alleged prescription is not more precisely defined in the plaintiff’s reply.
51 Amongst the uses which Lim Group Holdings asserts in paragraph 20 of its reply, which would go beyond the entitlements granted to it in the registered easement, is accessing its property via what is described as the “Lim garden gate”:
“[F]or the purposes of stopping, loading and unloading vehicles with inter alia furniture, building materials, appliances, goods, rubbish and supplies for use in its property management and development business.”
52 The evidence at trial does not establish the enjoyment of any such right for twenty years or more. As noted above, the ground floor of the Lim Group Holdings building was, until 2001, used as a childcare centre. Its use as a storage depot for the company’s property management business at a variety of locations in inner Melbourne necessarily commenced thereafter. Logically, this usage must have commenced less than twenty years ago. There can be no prescriptive easement on that basis.
53 In any event, as will appear, the uses alleged are in no way inconsistent with their being, as the plaintiff’s pleadings ultimately assert, in pursuance of the Right of Carriageway constituted by the registered easement. It may be that a twenty‑year usage of the type alleged might be regarded as forming a basis for the existence of a prescriptive easement for the benefit of the three portions of the plaintiff’s complex which do not, according to the register under the Transfer of Land Act, enjoy the right of carriageway. The time period involved, however, is inadequate.
54 Again, according to the evidence of Mr Leong Lim and the discussions which Mrs Paragreen held with his younger brother, the aspiration of Lim Group Holdings is to use the right of way as a base from which to carry out building operations. This aspiration is specifically pleaded in paragraph 20 of the Amended Statement of Claim, which refers to Lim Group Holdings’ intention to build “a multi-apartment development” on its site with a basement car park accessed by the right of way. It is further contended that the Paragreen’s gate is “too narrow, and the cross-bar too low, to accommodate cranes, cement mixers and other construction vehicles”.
55 I will consider below whether the terms of the Right of Carriageway established by the registered 1873 easement extend to the deployment of cranes, cement mixers and other construction vehicles in the right of way for the purposes of a redevelopment on the plaintiff’s land. For present purposes, I note that, according to the evidence, there were two distinct construction phases for the plaintiff’s land: one in the late 1990s, and the other in the early years of the new millennium. These were distinct and limited construction periods. They establish no continuous user for the necessary twenty‑year period to avail under the doctrine of lost modern grant.
56 Further matters of long usage which it appears are being invoked are the use of the right of way for maintenance purposes. It appeared that on the most recent repaint of the plaintiff’s building, its eastern boundary - that is, the one abutting the right of way - was not repainted at all. The evidence as to occasional work on windows or ventilators abutting the right of way was, in my view, too vague, intermittent and de minimis to form the basis for the acquisition of any prescriptive right. Assuming, despite the doubts that I have expressed above, that such a matter is properly open to the plaintiff upon its pleadings, the use of the right of way at the southern end in the vicinity of a recess where the “wheely bins” for the disposal of rubbish from the plaintiff’s complex are located is, in my view, too de minimis to establish any new or more-extensive prescriptive rights beyond those contained in the registered 1873 easement.
57 I put the doctrine of lost modern grant to one side, and, to the extent that it has been properly raised (which I doubt), I reject it.
Section 24(2)(d) of the Subdivision Act 1988
58 Section 24(2)(d) of the Subdivision Act 1988 provides:
“(2) Upon registration—
...
(d) any easement, restriction or other right is created, varied or removed as specified in the plan; ... .”
59 This paragraph of the Subdivision Act is referred to and relied upon by the plaintiff in its pleadings. I do not recall any submission by Mr Arthur in support of its application to the facts disclosed at trial. As I would understand this paragraph, it provides for the creation of easements depicted on plans of subdivision upon registration of those plans. The obvious and primary operation for this provision is to create new easements within a plan of subdivision so as to accommodate the relative rights and responsibilities of the owners and occupiers of the allotments.
60 The present plan depicts the plaintiff’s easement of carriageway as “E‑2” on the plan. Since this easement had existed for over a hundred years prior to the registration of the Plan of Subdivision, it is difficult to see how it could be said that the registration of the plan created that pre-existing easement, much less varied or removed it. Even if the paragraph has any subject matter to operate upon or work to do, it would seem to add nothing to the pre-existing registration under the Transfer of Land Act 1958 and its predecessor statute.
Section 72 of the Transfer of Land Act 1958
61 Also referred to and relied upon in the plaintiff’s pleadings is s72 of the Transfer of Land Act 1958. That section provides as follows:
“Notification of easements in Register
(1) A folio of the Register may contain a recording to the effect that the land therein described is subject to or has appurtenant thereto an easement.
(2) Upon application in an appropriate approved form the Registrar shall on the relevant folio of the Register make a recording of any easement over or upon or appurtenant to any land under this Act which the Registrar is satisfied has been created by compulsory acquisition in accordance with section 36 of the Subdivision Act 1988 or by any instrument deed or other written document or recognized by an order of any court or award of an arbitrator.
(2A)Subsection (2) does not apply to the creation of an easement—
(a)which is part of a plan of subdivision or consolidation; or
(b)if the creation of the easement is authorised by a planning scheme or permit under the Planning and Environment Act 1987;
(2B)The Registrar may accept a legal practitioner’s certificate as evidence of the creation of an easement over or upon or appurtenant to any land under this Act.
(3) When in any folio of the Register or instrument an easement is referred to or created or reserved by the use of the words ‘Together with [or Reserving] a right of carriage-way over’ [specifying the roads subject to the easement and referring to a map or plan of subdivision] such words shall have the same effect and shall be construed as if the words contained in the Twelfth Schedule had been inserted in the folio of the Register or instrument.”
62 Once again, it is difficult to see that this section adds anything to the entitlements of Lim Group Holdings derived from the registered 1873 easement. The words by which, under ss(3), the terms of an easement of carriageway as defined in the Twelfth Schedule to the Act may be engaged, were not used in the present creation of easement. That fact, and the fact that in any event, the 1873 easement pre‑dated the 1958 Act, means that this section adds nothing. I put it to one side.
The Right of Carriageway
63 I now come to the registered easement as created in 1873, the terms of which are quoted above. Mr Palmer, on behalf of the defendants, was initially inclined to advance argument to the effect that this creation of easement was not apt to create, as the plaintiff had contended, an easement of carriageway in general terms. For somewhat abstruse reasons which it is not necessary to traverse here, Mr Palmer elected not to press any argument along those lines. (T56, T405-6)
Appurtenant to which land?
64 As noted above at paragraph [5], it is only the most easterly of the four allotments comprised in the plaintiff’s complex, being the land described in Certificate of Title Volume 2912 Folio 361, which, according to the register under the Transfer of Land Act 1958, enjoys the benefit of the 1873 registered easement. Lim Group Holdings purports to enjoy the benefit of this registered easement as an appurtenance to its entire complex comprised in the four titles, not merely the most easterly one. It uses the right of way to access, load and unload items to be stored in an area extending across the four titles. It seeks to have the right of way in future available to provide vehicle access to a car park extending across the four titles for the benefit of residential units to be located throughout the area comprised in the four titles. Its case does not seek to draw any distinction between the titles comprised in its complex for these purposes.
65 The ability of a dominant tenement owner to exercise rights over the servient tenement for the benefit not only of the dominant tenement identified in the instrument creating the easement, but also other land, was considered by the High Court of Australia in Westfield Management Limited v Perpetual Trustee Company Limited (2007) 233 CLR 528. In that case, the easement had been created in the relatively recent past, viz 1988 in connection with the establishment of the Pitt Street Mall in central Sydney. The easement provided a right of carriageway underground to provide access to a building opened in 1990 called ‘Skygarden’. By 2007, the Skygarden building was owned by the appellant, Westfield, which had also acquired adjacent commercial developments known as ‘Imperial Arcade’ and ‘Centrepoint’. It sought to use the underground way for the benefit of these complexes as well. The terms of the easement of carriageway were as follows:
“Full and free right of carriageway for the grantee its successors in title and registered proprietors for the time being of an estate or interest in possession of the land herein indicated as the lots benefited or any part thereof with which the rights shall be capable of enjoyment and every person authorised by it, to go, pass and repass at all times and for all purposes with vehicles to and from the said lots benefited or any such part thereof across the lots burdened.”
(2007) 233 CLR 528 at 533 [15]
(emphasis added)
66 The Court dismissed an appeal from the New South Wales Court of Appeal which had determined that Westfield was not entitled to exploit the easement in the manner described. It approved the reasoning of Hodgson JA in the Court of Appeal when he said:
“Although the words ‘to and from [the dominant tenement] or any such part thereof’ do not exclude the possibility that the right should extend to going to the dominant tenement and then going across it to further land, and then returning across the dominant tenement and then going from it across the servient tenement, the words tend to suggest that it is access to and from the dominant tenement that is the purpose of the [E]asement, and not access to further land reached only by going across the dominant tenement. Certainly, if it had been intended that the grant extend to the authorisation of others to go across the dominant tenement to further properties, the words ‘and across’ could readily have been added.”
(2007) 233 CLR 528 at 534 [18]) ((2007) NSW ConvR 56-170 at 56,175)
(emphasis in original)
67 Westfield seems to provide a determination of the highest possible authority, requiring the rejection of Lim Group Holdings’ case on this point. As the reasoning of Hodgson JA in the Court of Appeal, approved by their Honours in the High Court, indicates, the outcome was crucially dependent upon the words employed in creating the easement. It would have been possible to create an easement having the effect contended for by Westfield, and by Lim Group Holdings in this case.
68 Unsurprisingly, Mr Arthur, on behalf of Lim Group Holdings, sought to distinguish Westfield. Mr Arthur observed that the 1873 easement in this case, in contrast to the one in Westfield which gave the dominant tenement owner authority to pass and repass “to and from the said lots” provided for the dominant tenement owner to be authorised to go “into and out of” the benefited land. The language is different, but it was not clear to me that this difference in wording was material. Again, the 1873 easement empowers the owner of the dominant tenement to go “through over and along” the right of way, but that seems to provide no material distinction. On a factual distinction, which I asked him to identify, he said, at T482, L9-12:
“But our primary point is that once we open the garden gate, we are already there. We don’t have to go through the right of way to get to the destination. We are already there.”
69 I am not sure that I understand the point of distinction which counsel was seeking to draw. Whatever it means, it is a distinction which I find difficult to accept. The acid question here is what entitlements do Lim Group Holdings, as owner and occupier of the most westerly of the four titles, have over the right of way? Commencing from any part of the land comprised in this title, or indeed its neighbour immediately to the east, Lim Group Holdings cannot say “we are already there”, viz on the right of way. By way of background, it should be said that the “garden gate” referred to is on the eastern boundary of the plaintiff’s complex, several metres to the south of the point at which the Paragreens have erected their gate.
70 Mr Arthur also placed some reliance upon the view that the right of way should be treated not as a cul de sac, but as a throughway to Rosslyn Street. Again, I am not entirely clear as to how this would create a point of distinction between this case and Westfield on a material point; however, the findings that I have already made mean that the premise for this argument, whatever its precise details might be, has already been rejected, and no more need be said about it.
71 Mr Arthur also placed reliance on a decision of Doyle CJ sitting as a trial judge in Kyren Pty Ltd v Cinema Place Pty Ltd [2004] SASC 268. In that case, said Mr Arthur, the Court, “with a very similar covenant and a commercial inner city location, was prepared to give the dominant tenement holder extensive ancillary implied rights”. (T469, L29-31) He observed that in Kyren’s case:
“[T]he court didn’t seem to be troubled by the fact that while the dominant tenement holder owned five lots, only two of those lots abutted the right of way.”
(T469, L23-25)
72 The dispute in Kyren’s case arose during the course of construction on the dominant tenement. The plaintiff dominant tenement owner successfully contended that it was entitled to have motor vehicles use the right of way to deliver building materials to the site and to carry out work on the building’s exterior. At paragraph 48, his Honour said:
“The right of way extends to the use of motor vehicles on Vaughan Place to bring goods to and from the dominant tenements. It includes causing those vehicles to stand on Vaughan Place for a reasonable time while being loaded or unloaded: see Robmet Investments Pty Ltd v Don Chen Pty Ltd (1997) 8 BPR 15,461. Deanshaw and Deanshaw v Marshall (1978) 20 SASR 146 at 149-150; Elliott v Renner [1923] St R Qd 172. My findings in relation to Vaughan Place and the dominant tenements satisfy me that such a use of Vaughan Place would have been contemplated by the parties to the grant.”
[2004] SASC 268 at [48]
73 I will consider the entitlement of the holder of right of carriageway to use the right of way for the delivery of materials or the collection of materials from the dominant tenement in due course. The present significance of Kyren’s case is the extent to which it bears upon the principle seeming to derive from the Westfield case.
74 The learned Chief Justice was sitting at trial level. To the extent that he might have proceeded on any legal basis inconsistent with a later decision of the High Court of Australia, the reasoning in the latter case would necessarily prevail. In any event, as Mr Palmer, for the defendants, accurately observed, the reasoning of Doyle CJ was in no way inconsistent with Westfield. Indeed, it was entirely consistent with it. His Honour made the following remarks in paragraphs to which I was not taken by Mr Arthur:
“[76] That leaves the question of the significance of the fact that the building extends over all five allotments owned by Kyren. Kyren has conducted its case before me on the basis that it seeks to use Vaughan Place only in connection with the erection and fitting out of that part of the building that is situated on the dominant tenements, and subsequently in connection with the two commercial premises that will be located on the ground floor of that building, and on the dominant tenements.
[77] It is well established as a matter of law that the right of way that attaches to the dominant tenements cannot be used for the benefit of other tenements. The right is a right to bring vehicles on to Vaughan Place in connection with the enjoyment of the dominant tenements only: see Shean Pty Ltd v Owners of Corinne Court 290 Stirling Street, Perth Strata Plan 12821 [2001] WASCA 311; (2001) 25 WAR 65 at [34]-[42]; Bradbrook and Neave at [6.44].
[78] Although Kyren claims only to exercise the right of way for the benefit of the dominant tenements, the evidence before me did not explain how it will ensure that its use is so restricted. On the other hand, it is relevant to bear in mind that the construction of the building is well advanced, and Kyren has access to the site from Frome Street at the west end, and from the east-west portion of Vaughan Place. There is no reason to think that Kyren needs or wishes to use Vaughan Place in connection with the erection of that part of the building that will be erected on land other than the dominant tenements. It has managed so far without access to Vaughan Place. At the same time I recognise that it will be difficult for Cinema to satisfy itself that Kyren is not exceeding its rights.
[79] My conclusion is that, in the circumstances, Kyren remains entitled to exercise its right of way. Kyren denies that it will exercise its rights so as to benefit land other than dominant tenements, and the circumstances do not point to a conclusion that that denial should be rejected. It is possible to distinguish between a use for building work on the dominant tenements and use for building work on the other allotments. Kyren has managed so far without access to Vaughan Place.
[80] It would not be right to refuse to enforce Kyren’s rights on the basis that the use of those rights might be excessive. I accept that if it is impossible to sever the proper use of a right of way from an excessive use, the owner of the servient tenement may stop the use altogether: Gale on Easements (15th ed, Sweet & Maxwell, 1986) at 311.
[81] In the present case the proposed use is not excessive, merely because it is a use in connection with a building that extends to allotments other than the dominant tenements. There is a risk that the proposed use will be excessive, and it is only fair to Cinema to recognise that proof of excessive use will be difficult. Nevertheless, as I am not satisfied that the use will be excessive, I conclude that the risk of excessive use is not a reason to decline to enforce Kyren’s rights. It remains open to Cinema to object in the light of later events that the use of Vaughan Place, or a proposed use of it, is, or will be, an excessive use of the right of way.”
Kyren (ibid, at [76]-[81])
75 In the present case, there has been no attempt made by Lim Group Holdings to draw a distinction between any of its four titles. The evidence was that their property, spread over four titles, operated as an integrated complex. If the projected residential unit redevelopment proceeds, once again the contemplated underground car park accessed from the north-east corner of the right of way would serve the entire complex, not merely the area comprised in the most easterly title. If this multi-unit residential development were to be constructed, it would seem that the Paragreens, or whoever was the then-owner of their unit, would be entitled to require use of the right of way to cease altogether in accordance with the principles stated by his Honour at [80].
76 Whatever the precise principle that could be regarded as established by the Westfield case, Mr Arthur contended that there was a recognised exception to it, exemplified by the decision of Warner J in the High Court Chancery Division in England in National Trust for Places of Historical Interest or Natural Beauty v White [1987] 1 WLR 907. The National Trust operated an historic site in Wiltshire, and held the benefit of a right of carriageway over a track giving access to the site through the defendants’ farm. The county council had constructed a car park adjacent to the track and opposite the farm, on property leased to it by another land‑owner. The defendants complained that this arrangement increased the volume of traffic and adversely affected their enjoyment of their farm property.
77 The Court held that whilst the National Trust, as owner of the dominant tenement, could not increase the burden on the servient tenement by enlarging the dominant tenement, it could use the right of way to access land near the dominant tenement to which that land was ancillary to the enjoyment of the dominant tenement. His Lordship said:
“It is not as if the National Trust claimed a right to authorise people to use the track for access to the car park for the purpose of enjoying the car park itself, e.g. by picnicking there. Indeed, one way of describing the right claimed by the National Trust is as a right to authorise people to use the track to get to Figsbury Ring [the historic property], in their vehicles as far as the car park and on their feet from there on.”
[1987] 1 WLR 907 at 913
78 In my view, this exception has no application to the present state of facts. What Lim Group Holdings wants to do is to use the right of way for the benefit of all four titles without any one of such titles being ancillary to the other, in the way that the car park was found by his Lordship to be ancillary to the historic property. What Lim Group Holdings wishes to do is the equivalent of using the right of way to enable visitors to picnic on the car park.
79 It follows, in my view, that use of this right of way to service the plaintiff’s integrated facility extending over four titles, to only one of which is the right of way appurtenant, is excessive. The 1873 easement would not authorise the use of the right of way to access an underground car park for a residential development extending over those four titles.
80 Mr Arthur complained that this point relied on by the defendants did not appear in their pleadings. I have not sought to analyse the defendants’ pleadings to ascertain if, upon their proper construction, this point is open. It was referred to by Mr Palmer in his opening statement, made immediately after Mr Arthur’s opening. It was also the subject of extensive submissions by both counsel. Accordingly, in my view, it is proper that I consider it, whether it has been pleaded or not.
Extent of entitlements under right of carriageway
81 In the Westfield case, the High Court considered the rules of construction to be applied to registered easements. In their joint Judgment, Gleeson CJ, Gummow, Kirby, Hayne and Heydon JJ said:
“However, in the course of oral argument in this Court it became apparent that what was engaged by the submissions respecting the use of extrinsic evidence of any of those descriptions, as an aid in construction of the terms of the grant, were more fundamental considerations. These concern the operation of the Torrens system of title by registration, with the maintenance of a publicly accessible register containing the terms of the dealings with land under that system. To put the matter shortly, rules of evidence assisting the construction of contracts inter partes, of the nature explained by authorities such as Codelfa Construction Pty Ltd v State Rail Authority of NSW, did not apply to the construction of the Easement.”
(2007) 233 CLR 528 at 539 at [37]
82 Their Honours continued:
“The third party who inspects the Register cannot be expected, consistently with the scheme of the Torrens system, to look further for extrinsic material which might establish facts or circumstances existing at the time of the creation of the registered dealing and placing the third party (or any court later seized of a dispute) in the situation of the grantee.”
(Ibid, at [39])
83 There can and should be no attempt to place the Court “in the shoes” of the parties to the 1873 instrument. Their Honours nevertheless said:
“To some degree the attraction of “the common law approach to the construction of grants of easement” has been to counter arguments that a right of way may be used only for the purposes for which the way was used at the time of the grant. But to accept the proposition that the user under a registered easement may change with the nature of the dominant tenement, so long as the terms of the grant are sufficiently broad, does no violence to the principles of the Torrens system.”
(2007) 233 CLR 528 at 540 at [42]
84 In the present case, the right of carriageway is bestowed in wide terms, generally equivalent to the form of words used in the Twelfth Schedule to the Transfer of Land Act 1958. The words are general, in the sense that the right of carriageway is not restricted, for instance, to pedestrians, or expressed to be restricted to traffic generated by a particular use of the dominant tenement existing in 1873. The general rule as to rights of carriageway is as stated by the learned editors of Bradbrook and Neave’s Easements and Restrictive Covenants [6.20]:
“The present rule is that a grantee is not confined to using a right of way for the purpose of prevailing at the date of the grant, but may use the way for any different purpose.”
(3rd ed, 2011), 376 [6.20]
85 Later, the learned editors stated:
“In White v Grand Hotel, Eastbourne Ltd [1913] 1 Ch 113, a private dwelling house, to which a right of way was appurtenant, was converted into a hotel. The different user was held by the Court of Appeal to be within the terms of the grant. A similar conclusion was reached by the Court of Appeal in Jelbert v Davis [1968] 1 WLR 589, where the dominant tenement was changed from agricultural use to a camping and caravan site.”
(Ibid, at 178)
86 I also refer to Grinskis v Lahood [1971] NZLR 502 at 509, where conversion of the dominant tenement from a block of flats to motel units was held not to limit the continued operation and entitlement of the right of carriageway by the motel guests (Bradbrook and Neave, ibid at 177). These propositions are well established and were common ground in the course of argument.
87 Building on these general principles, Mr Arthur submitted that Lim Group Holdings, as the owner of the dominant tenement, enjoys not merely the rights granted expressly by the 1873 instrument, but also “such ancillary rights as are necessary to the exercise and enjoyment of the easement”. He referred to Court Forms, Precedents and Pleadings Victoria [29,070], Jones v Pritchard [1908] 1 Ch 630 per Parker J, and Biki v Chessells [2004] ANZ Conv R 296 per Ormiston J. He referred to the statement by Parker J in Jones v Pritchard:
“[T]he grant of an easement is prima facie also the grant of such ancillary rights as are reasonably necessary to its exercise or enjoyment. Thus the grantee of an easement for a watercourse through his neighbour’s land may, when reasonably necessary, enter his neighbour’s land for the purpose of repairing, and may repair, such watercourse.”
(Ibid, at 638)
88 He referred to the paragraph already quoted from Court Forms, Precedents and Pleadings Victoria where the learned editors state:
“Ordinarily, apart from the right of way itself, the dominant owner has the right to load and unload vehicles in connection with business purposes provided that the exercise of the ancillary right does not obstruct other users of the right of way and he or she also has the right to repair a right of way.”
89 Mr Arthur noted that the right of way was described on some title documents as a “road”. He referred to a definition from an online dictionary service defining road as:
“A wide way leading from one place to another, especially one with a specially prepared surface which vehicles can use.”
90 He noted the determination by Doyle CJ in Kyren’s case that the dominant tenement holder was entitled to exercise the right of way over the defendant’s land by having motor vehicles deliver material to the building site and bring vehicles onto the defendant’s land to carry out work on the building’s exterior when the building was complete. He referred to Boglari v Steiner School and Kindergarten (2007) 20 VR 1 as supporting an entitlement to use a right of way for a use different from the one obtaining when it was granted. Similarly he referred to Megarry and Wade, The Law of Real Property (6th ed, 2000), pages 1153-4 [18-197].
91 The learned editors of Australian Real Property Law (3rd ed, 2002) state, with respect to rights of carriageway:
“The question whether the owner of the dominant tenement always has the right to stop to set down or pick up passengers or to unload goods or to park appears to depend on the conditions existing at the time of the grant. There have been cases where these incidental rights have been held to come within the scope of a right of way, but it appears that there is no firm rule to this effect. Where the dominant land is used for business purposes, the owner may allow vehicles to stand outside her or his premises…provided that the vehicles do not cause an obstruction to other persons entitled to use the right of way.”
(691)
92 In Bulstrode v Lambert [1953] 1 WLR 1064, a right of carriageway was granted in general terms, but identifying the dominant tenement as “the auction mart”. Upjohn J determined that this easement entitled the owner of the auction mart to have a vehicle travel down the right of way, which was a cul de sac, and pause to load and unload merchandise. His Lordship said:
“It seems to me that the right of coming upon this land in order to get to the auction mart is virtually useless to the plaintiff, unless he can unload his vehicles there, and therefore he must have the right to keep his vehicles there while he unloads and loads them ... .”
[1953] 1 WLR 1064 at 1071.
See also Laris v Lin (No 2) [2016] NSWSC 560.
93 It follows that Lim Group Holdings and its licensees are entitled not merely to traverse the right of way, but also to stop for the purpose of loading and unloading items. This conclusion is subject, of course, to what I have already said as to the question of the land to which the right of carriageway is appurtenant. I will return to the significance of this limitation in due course.
94 Do the entitlements of Lim Group Holdings under the right of carriageway extend to carrying out maintenance, as the Messrs Lim would have it, by the use, for instance, of cherry-pickers to paint or maintain the eastern boundary wall of the present complex, scissor lifts, or mobile scaffolding?
95 Mr Palmer referred to and relied upon a dictum of Young CJ in Eq in Chiu v Healey [2003] NSWSC 857 [61], where his Honour said:
“A problem does, however, occur where a person wants not just to pass along the right of way but to stop. Stopping for a short moment incidental to passage is unobjectionable. However, staying on the right of way for a period of time to erect a ladder to paint is, in my view, an excessive user. The right to put the ladder up and paint must be obtained either by licence of the servient holder, by an order made by a magistrate under the relevant legislation ... or alternatively by an order under s 88K of the Conveyancing Act.”
96 His Honour’s conclusions relative to ladders would apply a fortiori to the use of cherry-pickers and mobile scaffolding. Admittedly his Honour was speaking of a right of footway, rather than a right of carriageway, as here, which provides for vehicular traffic. Loading and unloading items can be seen to be incidental to the right to come and go on the right of passageway in a way that carrying out maintenance tasks cannot be.
97 Again, granted that the creation of an easement gives, by implication, an entitlement to the beneficiary to do what is necessary to enable the right of carriageway to be enjoyed as such so that there is a right to construct or repair the surface of the right of way, a right to carry out maintenance on the dominant tenement is in no way necessary for the enjoyment of the right of carriageway. Where maintenance is being carried out, this may be seen as the principal purpose of the visit to the land affected by the right of way. It is in no way ancillary to the use of the right of way, as maintenance to the right of way itself is.
98 In Butler v Muddle (1995) 6 BPR 97, 532 [BC 9504808], Young J (as he then was) considered a vehicular easement of carriageway. One of the questions related to the existence or otherwise of an entitlement to park on the right of way. His Honour said, at page 6:
“The third matter is the question of parking. The easement is for passing and repassing. Unless parking is a necessary part of the passing and repassing, then one does not normally conclude that parties intended to confer a right of parking in the grant of a right of way. There may be some circumstances where the Court will draw that conclusion such as where there are obviously parking bays mapped out in the plan by which the easement was granted.”
99 At page 7, his Honour said:
“In the instant case, the only ostensible right given by the right of carriageway is the right to pass and repass ... I cannot see any reason for implying some right to park along a relatively small frontage of 23 metres in order to be able to exercise that right. Accordingly, I cannot see any right to park which would be implied.”
100 Plainly a right to carry out maintenance is a different entitlement from a right to park. Functionally, however, it has the same effect where the maintenance is envisioned as being carried out with the use of structures, albeit mobile, such as cherry-pickers and scaffolding. These pieces of equipment must be halted for a substantial period of time to allow maintenance to be carried out.
101 Mr Arthur relied on the decision of Doyle CJ in Kyren’s case in support of the proposition that Lim Group Holdings was entitled to use the right of way to facilitate building and redevelopment operations on its complex. One might think that if this be correct, then an entitlement to use the right of way for maintenance purposes on the existing structure would flow a fortiori. Doyle CJ said, at [50]:
“The right of way includes the use of Vaughan Place [the servient tenement] by motor vehicles in connection with the repair of premises on the dominant tenements, and in connection with the building of new premises on the dominant tenements: see, for example, Bond and Leitch v Delfab Investments Pty Ltd (1980) 26 SASR 462 at 471. The possibility of occasion arising to repair or to rebuild premises on the dominant tenements must have been contemplated by the parties.”
102 The authority referred to by his Honour in support of this proposition is a Judgment of Mitchell J: Bond and Leitch v Delfab Investments Pty Ltd (1980) 26 SASR 462. Interestingly, it seems that his Honour, the Chief Justice, was counsel for the successful plaintiffs before her Honour. The matter in dispute before her Honour was not so much the extent of rights bestowed by a right of carriageway, but whether the right of carriageway continued to exist at all. Senior Counsel for the defendant advanced a complex submission, based upon the interaction of a number of pieces of nineteenth century legislation and the events that occurred in the 1880s, to contend that any right of carriageway ceased to exist on 18 November 1886. ((1980) 26 SASR 462, 466) The dispute was adjudicated in favour of the plaintiffs, with a finding by her Honour that the right of carriageway existed and continued to exist, and that the plaintiffs should be awarded damages of $2,000:
“in respect of additional costs incurred in relation to the building of the town houses, by reason of the fact that the defendants prevented them from obtaining access to the private road.”
(1980) 26 SASR 462 at 471
103 In applying the principles of Bond and Leitch’s case, Doyle CJ did not, as I read his Judgment, determine that motor vehicles or items of building equipment could be parked on the right of way to enable them to be brought to bear on building operations on the dominant tenement. Rather, he said, at [2004] SASC 268 at [51]:
“The proposed use will be to deliver building materials for use on the dominant tenements, covering materials such as ‘bricks, glass, aluminium, plasterboard, mechanical ductwork, fixtures and fittings, tiles, carpets, plumbing …’.”
104 His Honour said that delivery of these items by small vans would be a use “within the scope of the right of way”. His Honour specifically abstained from determining whether what he described as “concrete trucks” could deliver pre‑mixed concrete by the right of way in conformity with predominant tenement owners’ rights. At [52].
105 In my view, what is contemplated by way of maintenance is not covered by the statements of principle in Kyren’s case or the decision of Mitchell J in Bond and Leitch’s case, which the learned Chief Justice followed and applied.
106 It would seem, therefore, that it would be competent to use the right of way for the delivery of materials for works or repairs on the dominant tenement or, by parity of reasoning, for the removal of materials which have been demolished; but it would not be within Lim Group Holdings’ rights to set up building equipment on the right of way to operate from there on its site.
107 Since ready-mixed concrete trucks were specifically mentioned in the evidence of Mr Leong Lim, I should say something about them. This was not a matter upon which Doyle CJ pronounced in Kyren’s case. In his evidence, Mr Leong Lim said that a concrete truck would not tarry on site, because otherwise its concrete would “set” if there were a delay of any appreciable time. (T123) Should one regard a ready-mix concrete truck as merely delivering material to the site, and pausing to unload, or as engaging in building operations from a location on the right of way? With some hesitation I prefer the second interpretation. I say that concrete trucks would not be within the scope of the easement of carriageway.
The Gate
108 The defendants’ gate is depicted in exhibit B. This exhibit includes some items of measurement which were verified in evidence by Mr Leong Lim. They were neither distinctly admitted nor distinctly denied by the defendants in their case. According to exhibit B, the width of the right of way is 2,730 millimetres, representing a conversion from 9 feet in the old Imperial measurements which were employed in 1873. The gate is said to have a height of some 2,380 millimetres and to open outwards. According to this exhibit, the useable area of the right of way is reduced to 2,460 millimetres, namely 220 millimetres from the western column and 50 millimetres from the eastern column.
109 A series of photographs admitted as exhibit 1 show a small utility truck, being a Mitsubishi Triton, employed by the plaintiff, inter alia, for delivery and collection of materials from the “garden gate”. These photographs do not, as it seems to me, show that the defendants’ gate, whilst open, would prevent the Triton from passing through. Doubtless any restriction in width would make a comparatively tight laneway even more so. Mr Lim’s attitude was that in the inner-city every millimetre counts; therefore, no narrowing or restriction of the right of way should be countenanced at all. Nevertheless, in the plaintiff’s reply, it was pleaded that the plaintiff would be prepared to agree to a somewhat different form of gate. It was unclear to me, either by reference to the reply or to the evidence, whether this was offered as a final and permanent concession, or one for an interim period only until matters progressed to the contemplated redevelopment of the plaintiff’s complex for the multi-unit residential development. Mr Leong Lim conceded that it would be possible for his company’s utility vehicles to reverse into the laneway and stop just south of the garden gate to unload. (T175, L7-13)
110 Moreover, Lim Group Holdings has access to the ground-floor storage area directly from Walsh Street. Further, it was obvious at the view that the “garden gate” was not frequently used. It has no outside handle enabling it to be opened from the right of way. Entry entails a step down, and there were no properly established steps; rather, an ad hoc arrangement had been made. (T197, L5-16) Mr Leong Lim agreed consequently that this gateway was not frequently trafficked. Indeed, Mr Sim Lim, the plaintiff’s property manager, and therefore the one with the most day-to-day knowledge of the plaintiff’s complex in Walsh Street, said of this “garden gate”:
“I would say [it is used] at least two to three times a year because there is a ... peak period for students movement when contracts are change[d] ... .”
(T237, L25-28)
111 In these circumstances, I do not believe that the evidence demonstrates that the defendants’ gate constitutes an unreasonable interference with the right of way.
112 The cross-bar on the gate is potentially an issue, insofar as it was suggested that the cross-bar was an obstacle to vehicles such as cherry-pickers and scissor lifts which might be used for maintenance purposes. The conclusion that I have already reached negativing any entitlement for the plaintiff to use the right of way for maintenance purposes means that these matters can be put aside. The issue of the Mitsubishi Triton vehicle carrying carpet is hypothetical. As explained, if the Triton vehicle reversed up the right of way, the tailgate would be to the south of the defendants’ gate and the cross-bar would create no issue, whether there was a roll of carpet on top or not. If the gate were opened and the nose of the vehicle were to project through it, one would not expect the hypothetical roll of carpet to be loaded right to the front of the vehicle.
113 The evidence as to present use does not establish any unreasonable interference with the plaintiff’s rights as dominant tenement. This conclusion is reached without any consideration of the conclusion necessarily flowing from Westfield’s case that use of the right of way to service a storage area extending beyond the dominant tenement necessarily means that the plaintiff’s present use of the right of way is excessive.
114 Mr Lim gave the example of the roll of carpet which might be carried on the roof of the Triton truck. (T136, L9-12) This is a “hypothetical”. The “garden gate” through which Lim Group Holdings said it loaded and unloaded furniture, building materials, and so forth, is to the south of the gate. There is no obvious reason why the Triton would need to travel north of the gate for loading or unloading.
115 Mr Lim said that loading was difficult, as was unloading, at the “garden gate”, because the defendants’ gate required the Triton to be parked further to the south for loading and unloading purposes, rather than with its tailgate to the north of the gate. (T129) I enquired whether it would be possible to open the gate and drive the utility further north so that the appropriate alignment with the “garden gate” could be obtained. He expressed scepticism. Based on exhibit 1 and the fact that the defendants themselves have no difficulty traversing the gateway, I do not believe that his scepticism was well justified. In fact, Lim Group Holdings has never used the key, and it would seem that this is dictated more by a desire to avoid anything which might entail an admission that the gate had been erected legally or that Lim Group Holdings was in need of permission to traverse this northern section of the right of way than upon any operational problem.
116 In Pattison & Stephens [2015] VCC 1423, I was required to determine a dispute as to easement of carriageway in the seaside township of Flinders. The primary contentions of Mr Pattison, the owner of the dominant tenement, was that he was entitled to have the servient tenement clear of all obstructions and clear for vehicular traffic for the entirety of its width. Counsel for the defendant resisted these absolute propositions. I summarised his contentions as follows:
“45. Mr Alexander appeared on behalf of the defendant. He referred first to the terms of the Twelfth Schedule to the Transfer of Land Act 1958. Next, he referred to a summary of the law as to rights of way by Kenneth Martin J in Staley v Pivot Group (No 6) [2010] WASC 228. The decision of Balmford J in Baypeak Pty Ltd v Lim [2005] VSC 77 at [99] and the decision of Hall J in Davidson v Elkington [2011] WASC 29 at [82].
46. In light of these authorities, Mr Alexander submitted the test for the court to apply was to consider:
(a) is there a ‘substantial interference with the … enjoyment of the carriageway’;
(b) a substantial interference is to be determined by reference to:
· the degree of interference, common sense, the ideas of reasonable people, the nature of the land, character, duration and time of interference and its effect.”
(at paragraphs [45] and [46]).
117 I accepted the defendant’s contention in this respect. In particular, I concluded that the erection of a gate at the street entry/exit of the right of way was not a substantial or unreasonable interference with the enjoyment of the carriageway, so long as the owner of the dominant tenement was provided with a key. I did not consider that the servient tenement owner was creating a substantial interference by employing a gate that needed to be opened manually rather than an automated one. Those considerations would seem to point away from any determination in this case requiring the defendants to remove the gate which they have erected. The situation of the two easements, however, is far from identical. In Pattison’s case, the right of way, even narrowed by the garden beds, was 3.3 metres wide, whereas the full width of the right of way in this case is less than 3 metres. Reference to the photographs in exhibit 1 demonstrates that the Mitsubishi Triton truck which is employed by Lim Group Holdings in managing its venues in inner Melbourne, and moving stores and materials from its depot in Walsh Street to other locations, is able to pass through the gate despite the narrowing effect of its surrounding structures.
118 Based upon the evidence of Mrs Paragreen and my observations on the view, I accept that there were good grounds for the Paragreens to wish to erect a gate for security purposes. The tender age of their two children, namely five to six and two years of age, also renders a gate highly desirable for their household. In light of the principles referred to, the present gate, which seems to be an efficient and appealing structure, should not be treated as a substantial interference with the right of carriageway, save on the basis of convincing evidence.
119 The present facts bear some resemblance to those considered by Brereton J in Trewin v Felton [2007] NSWSC 851. The dispute in that case, as in this, related to a right of carriageway. One of the matters in dispute was the entitlement of the servient owner to erect a fence for security purposes between the right of way and the dominant tenement. Another issue related to the erection of a gate which closed-off the final 5 metres of the right of way. His Honour considered, upon the facts and in light of evidence as to the need to use the right of way for vehicles towing trailers, that the gateposts constituted a substantial interference with the dominant owner’s rights. He concluded, however, that a gateway constructed with narrower gateposts would not be such an unreasonable interference. [77] As to the gate closing off the final 5 metres of the right of way, his Honour said:
“Mr Trewin [the dominant tenement owner] gave contradictory evidence as to whether it was necessary to enter on the last 5 metres when reversing into the second garage bay, being that closest to the Felton’s property. Mrs Trewin maintained that she needed to enter onto the last 5 metres in order to reverse into that bay, but having viewed the video evidence and inspected the site I am not satisfied that that is so. Nonetheless, I do accept that in order to manoeuvre a trailer, entry onto the last 5 metres is reasonably required. The only contrary proposition advanced amounted to the suggestion that the trailer could be detached and manhandled, and an obstruction that required the dominant owners to do that would be an unreasonable one.”
[2007] NSWSC 851 at [79]
120 The effect of his Honour’s reasoning would seem to be that the erection of a gate at the end of a right of way would not, in itself and without more, constitute an unreasonable interference with the dominant tenement owner’s right, without proof of the infliction of practical inconvenience. In the present case, no such practical inconvenience has been demonstrated. I have already noted that, subject to Lim Group Holdings’ objection on principle to using the key which has been provided to it, it could open the gate to enable it to project its vehicle through those gates to line up the tailgate for loading and unloading purposes with the “garden gate”. Further, as Mr Palmer, for the Paragreens, observed, there would be no problem with lining up the tailgate if the plaintiff’s vehicle or vehicles reversed along the right of way.
Parking
121 The undisputed evidence is that over a period of time the Paragreens have parked various vehicles on their portion of the right of way. According to Mrs Paragreen, they have suspended doing this pending the outcome of the present proceeding. The plaintiff asserts a right to have the entire right of way free of parked vehicles, based not only upon the terms of the easement of carriageway but also upon the terms of settlement which it reached with Judisco Pty Ltd, which it says now operate as a restrictive covenant binding upon the Paragreens. I will deal in due course with these restrictive covenant issues. For the moment, I will deal with the issue of parking only in terms of the plaintiff’s entitlements under the right of carriageway.
122 Where a motor vehicle is left for an indefinite period upon an area affected by a right of way, it constitutes an obstruction. As we have seen, there is no absolute entitlement for a dominant tenement owner to have the entire area affected by a right of way kept clear of obstruction. Mr Palmer’s contention, on behalf of the Paragreens, was that, as a matter of practicality, there was no reason for Lim Group Holdings or any of its licensees to traverse the area to the north of the defendants’ gate, and therefore for the Paragreens to park in that location constituted no unreasonable interference with the rights of Lim Group Holdings under the right of carriageway.
123 A similar issue arose for consideration by Brereton J in Trewin v Felton (ibid). It will be recalled that in the matter before his Honour, the servient tenement owners had erected a gate closing off the last 5 metres of the right of way. His Honour noted that the parking of a car or cars by a servient owner on a right of way may be an actionable obstruction, and it may be such “even though no one is in fact obstructed”, so long as there was something which “would have the effect of hindering passage if anyone wanted to pass”. [84]-[85].
124 His Honour continued:
“In this context, it is also important to bear in mind all the circumstances, including the rights of the servient owner and other persons entitled to use the way. It is not to be overlooked that the servient owner is entitled to do as it pleases on the servient land, so long as it does not interfere with reasonable use of the right of carriageway. It is not every act of parking on the right of carriageway that constitutes an actionable obstruction: for example, to park on the right of carriageway in a manner and location that did not obstruct the passage of the dominant owner or his licensees would not be a nuisance. To park there for a short time in circumstances that, in the event of the dominant owner or his invitees requiring access or egress, the vehicle could be promptly moved would, I think, not be an actionable obstruction.”
[2007] NSWSC 851 at [85]
125 His Honour said, as to the evidence before him:
“Generally speaking, the parking of which the Trewins [the dominant tenement owners] complain appears to have taken place in the vicinity of the last 5 metres. I accept that, to the extent that vehicles block access into the last 5 metres, this has the potential to obstruct reasonable user on those infrequent occasions when it is necessary or convenient for vehicles entering or leaving the rear of Lot 1 to manoeuvre on the last 5 metres.”
(Ibid, at [86])
126 The photographs at CB 241 depict a motor vehicle parked on the defendants’ property on the right of way behind the gate. Were the gates opened, there would be some scope for one of the utility vehicles used by Lim Group Holdings to project its nose into the defendants’ land and possibly align its tailgate with the “garden gate”. It might be that there would be insufficient scope for the nose of the vehicle to be driven north to facilitate unloading. A confident answer to this uncertainty would require perhaps further measurements or an attempt at a practical demonstration, which was not undertaken during trial.
127 In this state of uncertainty it is difficult to conclude that the parking of cars on the northern extremity of the right of way would not constitute an unreasonable obstruction of the plaintiff’s use of the right of way via the “garden gate”. Nevertheless, a determination to that effect ought not to be made because the present use, as previously explained, is excessive. A fortiori the proposed use of the right of way to access an entry point to a proposed unit residential development located over the four titles would also be excessive.
Chickens and play equipment
128 The evidence proved that, at some points in the past, children’s play equipment and a chicken coop were erected on the right of way within the defendants’ land. The chickens have been removed, and Mrs Paragreen said they would not be returning. There is no play equipment on the right of way now. The same reasoning would appear to apply to these items as would apply to a parked motor vehicle in the same area; except, however, that, since they are smaller in bulk, a utility loading or unloading from the “garden gate” might be able to project its nose into the defendants’ land with the gate open without being obstructed by the chicken coop or the play equipment, depending upon where they were placed. The more general comment about the present excessive use of the right of carriageway, however, applies likewise to these matters.
129 As Doyle CJ remarked in Kyren’s case:
“[I]f it is impossible to sever the proper use of a right of way from an excessive use, the owner of the servient tenement may stop the use altogether: Gale on Easements (15th ed, Sweet & Maxwell, 1986) at 311.”
[2004] SASC 268 at [80]
The Terms of settlement - restrictive covenant?
130 The terms of settlement between Lim Group Holdings and Judisco Pty Ltd appear at CB 111-114. Clause 2 of those terms provides:
“The Defendant undertakes not to park vehicles in the Laneway or allow its servants, agents or invitees to park vehicles in or otherwise obstruct the Laneway.”
131 Paragraph 7 provides:
“This Agreement shall bind the Defendant and its successors in title to the Defendant’s Land and the Defendant warrants that it will bring the terms of this Agreement to the attention of any prospective purchaser prior to that purchaser agreeing to purchase the Defendant’s Land.”
132 The “defendant” referred to is Judisco Pty Ltd. It is well established that negative as distinct from positive covenants which touch and concern land may be enforceable against successors in title under equitable principles. The terms of settlement include a clear promise on the part of Judisco Pty Ltd not to park vehicles on the right of way. Judisco is a predecessor in title of the defendants. Lim Group Holdings is the original covenantee with respect to Judisco’s promise not to park cars; therefore, there is no issue as to the passing of the benefit of the terms of settlement. This benefit, at least with respect to the promise not to park cars, was given to and remains with Lim Group Holdings.
133 According to the learned editors of Bradbrook and Neave’s Easements and Restrictive Covenants, the three requirements which must be satisfied for the passing of the burden of a restrictive covenant are:
(i) the covenant must be negative
(ii) the burden must be intended to run with the land, and
(iii) the covenant must be given for the benefit of land, not simply for the benefit of the covenantee, and the covenant must touch and concern that land. ((3rd ed, 2011) [14.19] page 276)
134 The promise not to park cars is plainly negative. Clause 7 quoted above, in my view, makes good the second requirement for the enforceability of these terms as a restrictive covenant. The promise not to park relates to a piece of land, viz the right of way, over which Lim Group Holdings enjoyed and enjoys a right of way. In my view, this establishes that it is given for the benefit of the land owned by Lim Group Holdings, and not merely Lim Group Holdings itself. Again, since the promise affects a right of way appurtenant to Lim Group Holdings’ land, it touches and concerns that land. Plainly it also touches and concerns the servient tenement.
135 Whilst the terms were not recorded in the Register Book under the Transfer of Land Act, they formed part of the vendor statement received by the Paragreens before they purchased their property. The Paragreens therefore took with notice of this promise not to park.
136 Mr Palmer was critical of the terms on a number of grounds. First, he said that the word “laneway”, which is central to the terms, and in particular to the promise not to park a vehicle, was ambiguous and misleading. He observed there is not a single laneway. That observation is no doubt accurate now, but as at the date of the terms, which preceded the subdivision and redevelopment effected by Mr Ryan, the laneway was comprised in a single title: Certificate of Title Volume 10359 Folio 486. The warehouse/factory to the west of the laneway was comprised in Certificate of Title Volume 10359 Folio 500. This latter title is not mentioned in the definition of the defendants’ land in Clause 1, which is said to be known as “38 Walsh Street, Melbourne”. Rather, the same Certificate of Title and Volume number as for the lane is mistakenly employed.
137 Mr Palmer then drew attention to the definition of the laneway, which describes it as being “between the plaintiff’s land and the defendants’ land”. Mr Palmer said there is no gap between these two parcels of land; they are contiguous, and this reference is incorrect. With this uncertainty attending the terms of settlement, apart from any other consideration, he said, they should not be regarded as binding upon the Paragreens.
138 In my view, there has been a fairly clear error in the definition of the defendants’ land. It should have referred to the title including the reference “Folio 500”, rather than merely being a repetition of the title particulars for the laneway itself. If that error is corrected, everything fits together in a rational fashion. In Fitzgerald v Masters (1956) 95 CLR 420, 437, McTiernan, Webb and Taylor JJ said:
“It is trite law that an instrument must be construed as a whole. Indeed it is the only method by which inconsistencies of expression may be reconciled and it is in this natural and common sense approach to problems of construction that justification is to be found for the rejection of repugnant words, the transposition of words and the supplying of omitted words.”
139 Applying this common sense rule of construction, a correction should be made to the definition of the defendants’ land so that it refers to “Folio 500” rather than “Folio 486”. Once this obvious correction is made, the land descriptions are in harmony and make sense.
140 Mr Palmer’s second and perhaps major point was that, on their true construction, the terms merely restricted Judisco Pty Ltd from parking cars in or on what was described as the laneway. To the extent that the Paragreens might be liable as successors in title under the equitable principles, having taken with notice, Mr Palmer said they might be liable for parking infractions by Judisco but were not themselves constrained from parking at all. In effect, Mr Palmer was contending that, in the absence of a definitional provision stating that a reference to “the defendant” should be taken to include a reference to any of its successors in title, the terms were inapt to be rendered binding upon successors in title as to their own actions as distinct from the acts of Judisco Pty Ltd.
141 Mr Arthur submitted that s79 of the Property Law Act 1958 reinforced the operation of Clause 7 of the terms. Section 79 provides as follows:
“Burden of covenants relating to land
(1) A covenant relating to any land of a covenantor or capable of being bound by him, shall, unless a contrary intention is expressed, be deemed to be made by the covenantor on behalf of himself, his successors in title and the persons deriving title under him or them, and, subject as aforesaid, shall have effect as if such successors and other persons were expressed.
This subsection shall extend to a covenant to do some act relating to the land, notwithstanding that the subject-matter may not be in existence when the covenant is made.
(2) For the purposes of this section in connexion with covenants restrictive of the user of land successors in title shall be deemed to include the owners and occupiers for the time being of such land.
(3) This section shall apply only to covenants made after the commencement of this Act.”
142 In my view, whether because of the terms of Clause 7 itself or s79 of the Property Law Act 1958, or their combined effect, the terms should be regarded as promises made, inter alia, by the Paragreens as successors in title. This leaves the point of construction as to which party Judisco and its successors in title should be regarded as promising would not park cars on the laneway.
143 I looked at some samples of restrictive covenants in precedent books; for instance, Precedent 450.27 in the Australian Encyclopaedia of Forms and Precedents, service 233, pages 4217-4219. Clause 6 of this conveyance form includes the following:
“The purchaser as to the allotment of land conveyed and with intent to bind all persons in whom the said allotment of land shall for the time being be vested, but not so as to be personally liable under this covenant after he has parted with all interest in the allotment, hereby covenants with the company as follows:
...
(c) not to erect or permit the erection of any building other than a detached or pair of semi-detached dwelling-houses (either with or without stables and garages, greenhouses, conservatories and necessary outbuildings) upon the said land hereby granted or any part thereof.”
144 This form of deed does not include a definitional or constructional provision to the effect that the purchaser include a reference to a successor in title. In context, the intent is clear enough. I do not accept the contention that the Paragreens are free of any parking restrictions under the terms of settlement on the basis of these matters.
145 Mr Palmer, however, submitted that they were so freed by operation of ss42 and 43 of the Transfer of Land Act 1958.
146 Mr Palmer noted that the Paragreens, as the registered proprietors of an estate in fee simple in their property, held an unencumbered indefeasible title by virtue of s42 of the Transfer of Land Act 1958 “except in the case of fraud”. Accepting that, by virtue of its inclusion in the vendor statement the Paragreens had notice of the terms of settlement, he said their indefeasible title was, by virtue of s43 of the Transfer of Land Act, “not affected by any ... unregistered interest”, including, in particular, the terms of settlement. Section 43 provided that the mere existence of an unregistered interest did not in itself denote fraud.
147 This analysis might be thought to be supported by the decision of the High Court in Toohey v Gunther (1928) 41 CLR 181. Ms Gunther contracted to sell the freehold of a hotel, together with furniture, fittings, licence and goodwill, to Mr Toohey. The hotel property had been made the subject of a trade tie covenant in favour of a brewery, created by a previous owner. This came to the attention of Mr Toohey, as the brewers, the beneficiaries of the trade tie covenant, gave notice to him of their claimed entitlement to a monopoly of beer supplied to the hotel until 1935. When Mr Toohey declined to complete the contract, Ms Gunther rescinded and forfeited his deposit. He then filed an originating summons seeking declarations that Ms Gunther was not entitled to rescind the contract or forfeit the deposit, and that no good title had been shown such as could compel him to settle.
148 Knox CJ concluded that since Ms Gunther’s predecessor in title had bought the hotel without notice of the trade tie covenant, he had been protected from being bound by it by s43 of the Real Property Act 1900 (which is to the same effect as s43 of the Victorian statute) ((1928) 41 CLR 181 at 193). Isaacs J reached the same conclusion (ibid, at 196-7). Higgins J determined the matter on other grounds, but remarked:
“[B]ut this I can say, with confidence - that if the purchaser [Mr Toohey] here had to rely on [the Real Property Act] alone for immunity from the tie, the title ought not to be forced on him.”
149 He noted that s43 of the statute provided protection to a purchaser only after registration, referring to a number of precedents to that effect. ((1928) 41 CLR 181 at 207) Starke J decided the case in favour of Ms Gunther on the basis of s42 and s43 of the New South Wales Real Property Act 1900, but upon the basis that they eliminated the trade tie upon registration of the transfer from the creator of the tie to Ms Gunther. ((1928) 41 CLR 181 at 209-10) Gavan Duffy J dissented.
150 The reasoning in the Supreme Court of New South Wales had turned on doctrines relative to the rule prohibiting clogs on the equity of redemption, since the trade tie covenant was given concurrently with a mortgage to secure an advance by the brewery company which had been repaid with the mortgage being discharged prior to Ms Gunther’s taking title to the hotel.
151 The present case differs from Toohey v Gunther because the Paragreens have been registered as proprietors of an estate in fee simple. Unlike Mr Toohey, therefore, they can assert the protection given by s43 of the Transfer of Land Act. In contrast to Toohey v Gunther however, they had notice of the existence of the terms of settlement before entering into their purchase contract by reason of its inclusion in the vendor statement. Despite superficial resemblances, therefore, Toohey v Gunther provides no direct guidance for the resolution of the present dispute.
152 Somewhat closer to the facts in the present case is the decision of the High Court in Bahr v Nicolay (No 2) (1988) 164 CLR 604. In 1980, Mr and Mrs Bahr sold a piece of land to Mr Nicolay, subject to a three-year leaseback, with a special condition providing for the Bahrs to repurchase the property at the end of the leaseback period for a nominated price. This clause was taken to have imposed an obligation on Mr Nicolay to sell the land back to the Bahrs. Mr Nicolay thereafter sold the land to Mr and Mrs Thompson. The sale contract to the Thompsons included a clause whereby they acknowledged the existence of an agreement between the Bahrs and Mr Nicolay. The Thompsons’ solicitor wrote to the Bahrs’ solicitors confirming the Thompsons’ acknowledgment of the Bahrs’ interest. The Bahrs then sought to exercise their right to repurchase which was resisted by the Thompsons.
153 The High Court, on appeal, held that the Thompsons could not assert protection from the Bahrs’ claim, based on the Western Australian equivalent of s43. According to Wilson, Brennan and Toohey JJ, the Thompsons, by taking a transfer knowing of and accepting the obligation to resell, became subject to a constructive trust in favour of the Bahrs. Mason CJ and Dawson J said that the acknowledgment by the Thompsons of the Bahrs’ right to repurchase created an express trust which was binding upon the Thompsons, and their repudiation of that obligation constituted fraud. The Court was divided as to whether the fraud referred to in the provisions equivalent to the Victorian s42 and s43 was confined to fraud in acquiring title.
154 Mr Arthur placed reliance upon the decision of Vickery J in Body Corporate No 12870 v Aldal Pty Ltd [2010] VSC 366.
155 Aldal’s case concerned entitlements to a covered walkway established in central Bendigo, established in accordance with a covenant entered into in 1988 (by coincidence, the same year as the date of creation of the easement in the Westfield case). The defendant acquired first, a one-third interest in the unit of the subdivision comprising the walkway in 1990, and the other two-thirds interest in 2003. It had obtained rate relief from the local municipal council based upon this unit’s being restricted to the use only as a walkway. The covenant entered into in 1989 relative to the walkway provided as a covenant by the then owner of the unit:
“… that neither the covenantor nor those deriving title under it will erect any building, wall or any other structure other than a floor and ceiling upon any part of the burdened land and that neither the covenantor nor those deriving title under it will use or permit to be used the burdened land for any other purpose than that of an arcade or pedestrian walkway.”
156 In 2005, Aldal attempted to block off the walkway. The barriers were not maintained, but the plaintiff body corporate commenced a proceeding seeking declarations, inter alia, that the covenant was binding on Aldal as a restrictive covenant. The 2003 contract of sale whereby Aldal acquired a two-thirds interest in the walkway included a special condition that Aldal acknowledged the existence of a number of agreements, including the covenant, and provided that the sale was made with Aldal “acknowledging the existence of those agreements”. The arrangement was disclosed in the vendor statement given under s32 of the Transfer of Land Act. The plaintiff claimed that despite the covenants not being notified on the register, it operated as an encumbrance on Aldal’s title despite s42 and s43 of the Transfer of Land Act. They relied upon Bahr v Nicolay (No 2) (ibid, at 604). Vickery J undertook a detailed analysis of the judgments of the various Justices in that case. His Honour noted that the fraud exception had not been pleaded by the plaintiff, although if it had been relied upon, he would have sustained it. His Honour said:
“[124] Again, although it was not pleaded by the Plaintiffs, if fraud, as an exception to the indefeasibility provisions found in ss.42 and 43 of the TLA had been pressed by them, I would have found that, having regard to the intention of the parties expressed in the acknowledgment clauses of the two sale agreements which I have found, the subsequent repudiation of those agreements would have constituted fraud within the exceptions referred to in ss.42 and 43 TLA.
[125] In this case the facts point to the existence of fraud in the sense described by Mason CJ and Dawson J in Bahr v Nicolay, namely that arising from the dishonest repudiation of a prior interest which the registered proprietor has acknowledged or has agreed to recognise as a basis for obtaining title. The repudiation was fraudulent because it had as its object the destruction of the unregistered interest in the restrictive covenant notwithstanding that the preservation of the unregistered interest was the foundation or assumption underlying the entry into the two sale contracts pursuant to which the Defendants as transferees took the property in Unit 10, first as to a one third interest, and subsequently as to the remaining two thirds interest.”
Body Corporate No. 12870 v Aldal (ibid, at 108 [124]-[125])
157 Mr Arthur submitted that I should see the present facts as analogous to those in Aldal and Bahr v Nicolay (No 2) (ibid). Mr Palmer, however, submitted that the conclusions in Aldal and Bahr v Nicolay (No 2) proceeded from a far more elaborate set of provisions in the relevant sale contract than was to be found here. The Court Book contained not only the Contract of Sale by which the Paragreens bought from Mr Ryan, but also the contract whereby he bought from Judisco. In this prior contract, the existence of the Terms of Settlement was made known by Judisco Pty Ltd to Mr Ryan.
158 Mrs Paragreen, who was the sole witness for the defendants, should, therefore, be regarded as speaking both for herself and her husband, did not suggest that she was unaware of the Terms of Settlement. The Sale of Contract from Mr Ryan to the Paragreens included an added manuscript provision “this offer is conditional upon the purchasers’ solicitor’s approval of Documentation by 8 JUNE ’11.” (CB 180) Mrs Paragreen did not disclose what advice she might have received from her solicitor as to the contract. (T316-7) When asked as to her appreciation of the meaning of the Terms of Settlement, she said she understood it to be a document which imposed obligations on Judisco Pty Ltd alone and, inferentially, not upon her and her husband. (T282, L 5-17).
159 The defendants’ case was at pains to draw attention to the basis on which the unit had been marketed by developer, Mr Ryan, to the Paragreens, namely as including a car parking space. Given that nothing in the evidence suggested that marking the unit in this way was approved, much less encouraged by Lim Group Holdings or the lessor’s Lim, it is difficult to see how this consideration can better the Paragreen’s position as against Lim Group Holdings. Mrs Paragreen said that the price that she and her husband were prepared to pay factored in the availability of off-street parking. Any adjudication denying this would devalue the property. (T368, L2-8).
160 General condition 1.1 of the Paragreen’s contract with Mr Ryan stated:
“The purchaser buys the property subject to:
a. any encumbrance shown in the Vendor’s Statement other than mortgages or caveats; and
b. any reservation in the crown grant; and
c. any lease referred to in the particulars of sale.”
(CB 173)
161 The Vendor’s Statement given under s32 of the Sale of Land Act 1962 was annexed to the Contract of Sale. It is not suggested that this was not available to the Paragreens before they entered the contract.
162 Paragraph 1 of the statement read as follows:
“1.RESTRICTIONS - information concerning an easement, covenant or other similar restriction affecting the Property (registered or unregistered):
(a)Description:
* As set out in the attached copy of title document(s)
… .”
(CB 185)
163 The first set of annexures to the Vendor’s Statement entailed the computerised printout particulars of proprietorship. The document setting out the relevant Plan of Subdivision also included the Terms of Settlement.
164 Mr Palmer drew attention to the sale, which was made of the second two-thirds of the interest in the walkway and Aldal as being made for the nominal consideration of one dollar, indicating a devaluation of the land consistent only with its being burdened by the covenant.
165 What led Vickery J in Aldal (ibid) and Mason CJ and Dawson J in Bahr v Nicolay (ibid) to find that the broad exception referred to s42 and s43 of the Transfer of Land Act was a finding that disregarding the relevant obligations entailed destroying unregistered interests which were “the foundation or assumption underlying the entry into” the relevant contracts. In the present case, it would plainly be an exaggeration to refer to the Terms of Settlement as the foundation of the Contract of Sale to the Paragreens; however, it plainly was an assumption which underlay it. In my view, it would be contrary to good conscience for the Paragreens, having known of the existence of the Terms of Settlement before entering into the purchase contract, now to disregard its terms. This would be fraud for the purposes of the exception, as it was applied in Aldal and Bahr v Nicolay (No 2) (ibid).
The chicken coops and the chickens
166 Mr Sim Lim said that when the chickens were in residence, he detected an offensive odour through the window of the ground floor room immediately opposite the Paragreen’s unit. Mrs Paragreen denied this. There was no detailed evidence and no evidence from a resident student who allegedly complained as to this matter. Mrs Paragreen said that the chickens had been removed and would not return. In those circumstances, I am not satisfied that the evidence makes out any case for relief relative to the chickens or the chicken coop.
The children
167 Mr Leong Lim objected to the Paragreen’s children playing on the right of way. The relevant portion of the right of way is comprised in land of which their parents are the fee simple owners. Unless the children obstruct vehicular or pedestrian traffic on the right of way, there is no ground to exclude them. This is a matter for the good sense and judgment of their parents, principally in the interests of the children themselves.
Relief
168 As to the declarations and orders which Lim Group Holdings now seek set out at paragraph [30] above, I have concluded that the 1873 easement grants a right of carriageway for the benefit of one portion of the Lim Group Holdings’ complex only. All of the items of relief which Lim Group Holdings seeks or required determinations giving the easement an excessive effect or seeking to make excessive use of it, the benefit land other than the land to which it is annexed. Therefore, these determinations should not be made.
169 It should be said in the most downright terms that Lim Group Holdings’ ultimate aspiration to use this right of way for access purposes for a redevelopment of their complex for the benefit of the entire complex would entail an excessive use of the easement. Indeed the present use of the easement is proven to be excessive.
170 I will direct that within fourteen (14) days the parties bring in short minutes to give effect to these Reasons. I have heard no submissions on costs so they will be reserved.
- - -
2
21
0