Maio v City of Stirling [No 2]
[2016] WASCA 45
•17 AUGUST 2017
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
TITLE OF COURT : THE COURT OF APPEAL (WA)
CITATION: MAIO -v- CITY OF STIRLING [No 2] [2016] WASCA 45
CORAM: MARTIN CJ
BUSS JA
MURPHY JA
HEARD: 27 JANUARY 2016
DELIVERED : 16 MARCH 2016
FILE NO/S: CACV 92 of 2015
BETWEEN: GIROLAMO MAIO
First-named First Appellant
GLENYS JOY MAIO
Second-named First AppellantJVR PTY LTD
Second AppellantLINEMARK INVESTMENTS PTY LTD
Third AppellantTHE OWNERS OF STIRLING VILLAGE STRATA PLAN NO 11718
Fourth AppellantAND
CITY OF STIRLING
First RespondentVALMARL PTY LTD
First-named Second RespondentPETER GRAHAM HEARN
Second-named Second RespondentBANK OF QUEENSLAND
Third RespondentRAINWAVE NOMINEES PTY LTD
Fourth Respondent
ON APPEAL FROM:
Jurisdiction : SUPREME COURT OF WESTERN AUSTRALIA
Coram :LE MIERE J
Citation :MAIO -v- CITY OF STIRLING [No 2] [2015] WASC 189
File No :CIV 2706 of 2013
Catchwords:
Deed - Proper construction - Party claiming benefit of deed not a party to the deed - Claimed entitlement to enforce deed by virtue of s 11(2) of the Property Law Act 1969 (WA) - Proprietary rights allegedly conferred on the nonparty - Alleged proprietary rights by way of easement for car parking - Easements - Easements by prescription - Doctrine of lost modern grant - Whether use of neighbouring property 'as of right'
Legislation:
Prescription Act 1832 (UK)
Property Law Act 1969 (WA), s 11(2)
Town Planning and Development Act 1928 (WA), s 7, s 24
Transfer of Land Act 1893 (WA), s 63A, s 65(3), s 69
Result:
Appeal dismissed
Category: B
Representation:
Counsel:
First-named First Appellant : Mr J Thomson SC
Second-named First Appellant : Mr J Thomson SC
Second Appellant : Mr J Thomson SC
Third Appellant : Mr J Thomson SC
Fourth Appellant : Mr J Thomson SC
First Respondent : Mr K Pettit SC & Mr P Wittkuhn
First-named Second Respondent : Mr D Jackson
Second-named Second Respondent : Mr D Jackson
Third Respondent : No appearance
Fourth Respondent : No appearance
Solicitors:
First-named First Appellant : Haydn Robinson
Second-named First Appellant : Haydn Robinson
Second Appellant : Haydn Robinson
Third Appellant : Haydn Robinson
Fourth Appellant : Haydn Robinson
First Respondent : McLeods Barristers & Solicitors
First-named Second Respondent : Hotchkin Hanly Lawyers
Second-named Second Respondent : Hotchkin Hanly Lawyers
Third Respondent : No appearance
Fourth Respondent : Hotchkin Hanly Lawyers
Case(s) referred to in judgment(s):
Attorney‑General v Simpson [1901] 2 Ch 671
Bakewell Management Ltd v Brandwood [2004] 2 AC 519
Codelfa Construction Pty Ltd v State Rail Authority of New South Wales [1982] HCA 24; (1982) 149 CLR 337
Dalton v Henry Angus & Co (1881) 6 App Cas 740
Delohery v Permanent Trustee Co of New South Wales [1904] HCA 10; (1904) 1 CLR 283
Gardner v Hodgson's Kingston Brewery Co Ltd [1903] AC 229
Kitching v Phillips [2011] WASCA 19; (2011) 278 ALR 551
KPMG LLP v Network Rail Infrastructure Ltd [2007] EWCA Civ 363
Maio v City of Stirling [No 2] [2015] WASC 189
Moody v Steggles (1879) 12 Ch D 261
Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37; (2015) ALR 188
New v City of Stirling (1986) 62 LGRA 368
Patel v W H Smith (Eziot) Ltd (1987) 1 WLR 853
Piromalli v Di Masi [1980] WAR 173
R (Barkas) v North Yorkshire County Council [2015] AC 195
R v Oxfordshire County Council, Ex parte Sunningwell Parish Council [2000] 1 AC 335
Royal Botanic Gardens and Domain Trust v South Sydney Council [2002] HCA 5; (2002) 240 CLR 45
Sturges v Bridgman (1879) 11 Ch D 852
The Bell Group (in liq) v Westpac Banking Corporation [No 9] and [No 10] [2008] WASC 239; (2008) 39 WAR 1
Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165
Yip v Frolich [2004] SASC 287; (2004) 89 SASR 467
MARTIN CJ: This appeal should be dismissed for the reasons given by Murphy JA, with which I agree.
BUSS JA: I agree with Murphy JA.
MURPHY JA:
Introduction
This is an appeal against a decision of Le Miere J in which his Honour dismissed the appellants' claim in respect of certain alleged proprietary rights over land registered in the name of the second respondent: Maio v City of Stirling [No 2].[1] The proprietary rights claimed by the appellants were, in effect, in the nature of an easement for parking on adjoining land. The rights allegedly arose pursuant to a deed to which they were not a party, referred to in these reasons as the '2010 deed' which, in turn, referred to an earlier deed, described in these reasons as the '1983 deed' to which the appellants were also not a party. Alternatively, the appellants claimed that their rights allegedly arose pursuant to the doctrine of lost modern grant or by prescription.
[1] Maio v City of Stirling [No 2] [2015] WASC 189 (primary reasons).
For the reasons which follow, in my view the appeal should be dismissed.
General background
In 1982 the City of Stirling (City) sold certain land on the corner of Cedric and Sanderling Streets, Stirling (the subject land), to parties who may, for present purposes, be sufficiently described collectively as the 'Original Owner'.[2]
[2] Primary reasons [12].
On 19 August 1983, the subject land was subdivided into, relevantly, lots 602 and 604.[3] In approving the subdivision, the Town Planning Board had required the Original Owner to enter into an agreement with the City.[4] The agreement was executed as a deed dated 11 May 1983 (1983 deed).[5] Prior to then, in the period 30 June 1982 - 11 May 1983, the Original Owner obtained approval for and developed the land on proposed lot 602 as a shopping centre.[6]
[3] Item 4, agreed chronology, WB 75.
[4] Item 2E, agreed chronology, WB 75.
[5] Item 3, agreed chronology, WB 75.
[6] Items 1D, 2F, agreed chronology, WB 75.
On 19 August 1983, lot 602, upon its creation, was itself subdivided by strata plan into 11 strata lots (the lot 602 strata lots), and the certificate of title for lot 602 was cancelled.[7] All lots on the strata plan were sold by the Original Owner, commencing on 25 October 1983, and the strata lots were onsold to other persons over the ensuing years.[8]
[7] Item 7, agreed chronology, WB 76.
[8] Item 9, agreed chronology, WB 76.
The supermarket was built on the land which became lot 6 of the strata plan (strata plan lot 6).[9] Strata plan lot 6 was transferred to the first appellant, Mr and Mrs Maio, on 23 December 1985.[10] Mr and Mrs Maio remain the current registered proprietors of strata plan lot 6, on which the supermarket remains situated.[11] The second appellant, JVR Pty Ltd (JVR), is the registered proprietor of lots 1 and 2 on the strata plan. The third appellant, Linemark Investments Pty Ltd (Linemark), is the tenant of lot 6. Mr and Mrs Maio are the sole shareholders and directors of JVR and Linemark. Mr and Mrs Maio, or their companies, control a majority of units under the strata plan. The fourth appellant is the strata company for the strata plan and sued as a representative of the proprietors of the lots in the strata plan pursuant to s 33(1) of the Strata Titles Act 1985 (WA).
[9] Primary reasons [19].
[10] Item 12, agreed chronology, WB 76.
[11] The matters in this paragraph are derived from primary reasons [19] unless otherwise indicated.
In general terms (and leaving aside certain events irrelevant for present purposes)[12] the following events occurred in relation to lot 604:
[12] See primary reasons [20] - [23].
(a)on 19 August 1983, the City lodged caveat C604832 (first caveat) on the title to lot 604 pursuant to the 1983 deed, forbidding registration of an instrument 'unless such instrument be expressed to be subject to the [City's] claim';[13]
[13] Item 6, agreed chronology, WB 76; GB 63.
(b)lot 604 was sold by the Original Owner in January 1985 and the transferee took, subject to the first caveat;[14]
(c)lot 604 was transferred again in 1986, when it was purchased by Mr and Mrs Siciliano who took subject to the first caveat;[15]
(d)Mr and Mrs Siciliano caused a service station to be built on lot 604, pursuant to a development approval by the City in August 1986;[16]
(e)on 21 August 2006, in contemplation of the purchase of lot 604 from Mr and Mrs Siciliano, the second respondent and another party (Mr Bogle) executed a 'Transferee's Assumption Deed' with the City (2006 deed);[17]
(f)on 24 August 2006, lot 604 was transferred by Mr and Mrs Siciliano to the second respondent and Mr Bogle, at which time the first caveat was withdrawn and, immediately upon lodgement of the transfer, the City lodged caveat J887305 (second caveat) on the title of lot 604;[18]
(g)in 2008, the service station on lot 604 was demolished;[19]
(h)on 13 October 2010, the City, the second respondent and the third respondent (bank) executed a 'Transferee's and Mortgagee's Assumption Deed' (2010 deed), in contemplation of the second respondent acquiring Mr Bogle's interest in lot 604;[20]
(i)on 18 October 2010, the second respondent became the sole registered proprietor of lot 604, having acquired Mr Bogle's interest, and the bank became the registered mortgagee on the title;[21]
(j)at the time of the above transfer on 18 October 2010, the City withdrew the second caveat and subsequently lodged, upon registration of the transfer, a further caveat L456329 (third caveat);[22] and
(k)in 2014, the second respondent entered into a contract to sell lot 604 to the fourth respondent (Rainwave).[23]
[14] Item 14, agreed chronology, WB 76.
[15] Item 41, agreed chronology, WB 80.
[16] Primary reasons [89]; GB 91 - 94.
[17] Item 17, agreed chronology, WB 77.
[18] Item 42, agreed chronology, WB 80.
[19] Primary reasons [6].
[20] Item 20, agreed chronology, WB 77.
[21] Item 21, agreed chronology, WB 77.
[22] Item 22, agreed chronology, WB 77.
[23] Item 23, agreed chronology, WB 77.
The 1983 deed
Legislative context - town planning
In 1983, s 24(1) of the Town Planning and Development Act 1928 (WA) provided, in effect, that if, in the opinion of the Town Planning Board (the Board), a plan of subdivision may affect the functions of a local authority, the Board shall forward the plan to such local authority for objections or recommendations. Section 24(2) provided that any such local authority was to forward to the Board any objections or recommendations it had in relation to the plan. By s 24(3) the Board had the power to approve or reject a plan of subdivision, and to affix 'such conditions as the Board may think fit, which shall be carried out by the owner before the plan is approved by the Board'.
As the appellants contended, the 1983 deed appears to have been entered into pursuant to a condition imposed by the Board under s 24(3) of the Town Planning and Development Act.
There was no dispute that the City had the power to enter into the 1983 deed. The 1983 deed was entered into in the statutory context that the 1974 City of Stirling District Planning Scheme (TPS 1) applied to the land. TPS 1, by cl 7.8, provided:
The [City] may enter into agreements with the owners of land within the Scheme Area … in respect of any matters pertaining to this Scheme.
By virtue of s 7(3) of the Town Planning and Development Act, TPS 1 had full force and effect as if it were enacted by that Act.
Kennedy J in New v City of Stirling[24] described an agreement made under a power conferred by a town planning scheme in the following terms:
The agreement having been made under the power conferred by the scheme, … required no statutory force. Its force was derived from its execution by the parties. It is capable of being varied by the parties without going through the process of amending the scheme. It cannot, nor does it purport to, impose any obligations upon third parties.
The terms of the 1983 deed
[24] New v City of Stirling (1986) 62 LGRA 368.
The 1983 deed was entered into between the City and the Original Owner. It contained recitals to the effect that:
(a)the Original Owner is the registered proprietor of the subject land;
(b)the Original Owner proposes to subdivide the subject land to form lots 602, 603 and 604, and has made application to the Board for its approval;
(c)the Board has granted its approval for the proposed subdivision subject to a condition requiring the Original Owner to enter into an agreement with the City; and
(d)at the request of the Original Owner, the City has agreed, subject to the provisions of this deed, to notify the Board that the condition referred to in Recital C has been fulfilled, and to recommend to the Board that the Original Owner be permitted to subdivide the subject land.
By cl 1, it was agreed that the City would notify the Board that the condition referred to in Recital C had been fulfilled and would make the recommendation to the Board as soon as practicable after the execution of the deed.
The 1983 deed provided that the Original Owner covenants with the City, as follows:
[2](a) in addition to any other consent or approval required by law, not to use or develop Lot 604 without the consent in writing of the [City] … which consent the [City] is at liberty to grant or refuse in its absolute discretion;
(b)not to suffer or allow vehicular access to or egress from Lot 604 from or to Cedric Street;
(c)in carrying out any development of Lot 604 to ensure that … any such development of Lot 604 and the existing shopping centre on Lot 602 have the appearance of a single complex;
(d)not to erect or permit to be erected a fence on or about the common or dividing boundaries of Lots 602 and 604 or … otherwise obstruct or impede the free movement and thoroughfare of persons and vehicles on either of those lots or from one lot to the other;
(e)upon the sale or transfer of either Lot 602 or Lot 604 to grant to the purchaser thereof and the successors in title, tenants, invitees, licensees, customers and visitors of such purchaser and all other persons lawfully entering the lot sold the right to use for the purpose of parking motor vehicles the car parking areas situated on the unsold lot together with full and unrestricted access from one lot to the other … and to reserve to the [Original] Owner as owner of the unsold lot and their respective successors in title, tenants, invitees, licensees, customers and visitors and all other persons lawfully entering the unsold lot the right to use for the purpose of parking motor vehicles the car parking areas situated on the sold lot together with full and unrestricted access from one lot to the other … such grant and reservation to contain covenants on the part of the [Original] Owner and the transferee of the sold lot with the [City] as follows -
(i)not to erect or permit to be erected a fence on or about the common or dividing boundaries of Lots 602 and 604 or … otherwise obstruct or impede the free movement … on either of those lots or from one lot to the other;
(ii)not to surrender, revoke or otherwise terminate or attempt to surrender, revoke or otherwise terminate the rights contained in the abovementioned grant and reservation … without the prior written consent of the [City]; and
(iii)not to sell, agree to sell, transfer or otherwise dispose of the lots … to any other person unless that person has first entered into a deed of covenant with the other parties hereto (including the [City]) to observe and perform the provisions of this Deed …;
(f)forthwith to obtain the unconditional written consent to … this Deed of any person entitled to an encumbrance on the subject land …; and
(g)not to sell, agree to sell, transfer, mortgage, charge or assign Lot 604 … unless the person to whom any such right or interest to or in Lot 604 is to be granted has first executed a deed of covenant to be prepared by the [City's] solicitors … whereby that person covenants to observe and perform all the covenants, conditions and stipulations herein contained (including this present covenant) in like manner as if he had been a party to this Deed …
Background to the 2010 deed
It is convenient to recapitulate the position as at the date of entry into the 2010 deed:
(a)the 1983 deed had been entered into in May 1983 for planning purposes;
(b)in August 1983, the Original Owner had subdivided lot 602 by strata plan into the lot 602 strata lots and sold them, commencing in October 1983, without granting to purchasers the right to use the car parking areas on lot 604, and without reserving to itself as owner of lot 604, the right to use the car parking areas on the lot 602 strata lots;
(c)when in 1985 the Original Owner sold lot 604, it did not (and could not, given that it had already subdivided and sold the lot 602 strata lots) grant to the purchaser of lot 604 the right of parking on the lot 602 strata lots; and
(d)on 21 August 2006, in contemplation of the second respondent and Mr Bogle acquiring Mr and Mrs Siciliano's interest in lot 604, the second respondent and Mr Bogle entered into the 2006 deed.
The 2006 deed was entered into between the second respondent and Mr Bogle (collectively described as the 'Transferee') on the one part, and the City on the other part. The 2006 deed recited the desire of the Transferee to purchase lot 604 from Mr and Mrs Siciliano, and the Transferee's agreement to be bound by the terms of the 1983 deed.
The 2006 deed, by cl 2, provided:
The Transferee agrees with the [City] that the Transferee will duly and punctually observe and perform all the provisions of the [1983 deed] on the part of the Original Owner, to be observed and performed in like manner as if the Transferee had been named as the Original Owner, in the [1983 deed].
Also, as at 13 October 2010, the land was the subject of the City of Stirling Local Planning Scheme No.3 (LPS 3). Clause 11.1.1 of LPS 3 provided:
The [City] in implementing the Scheme has the power to -
(a)enter into an agreement with any owner, occupier or other person having an interest in land affected by the provisions of the Scheme in respect of any matter pertaining to the Scheme.
The 2010 deed
The 2010 deed was entered into on 13 October 2010 by the City, the second respondent as 'Transferee', and the bank. There were recitals to the effect that Mr Bogle desired to transfer his share in lot 604 to the second respondent, and the second respondent agreed to execute the 2010 deed; by executing the 2010 deed the second respondent agreed to be bound by the terms of the 1983 deed; and that the second respondent desired to mortgage lot 604 to the bank and the bank agreed to execute the 2010 deed.
Clause 2 provided:
The Transferee agrees with the [City] that the Transferee will duly and punctually observe and perform all the provisions of the [1983 deed] on the part of the Original Owner, to be observed and performed in like manner as if the Transferee had been named as the Original Owner, in the [1983 deed].
Clause 3 provided:
The Transferee hereby charges [lot 604] in favour of the [City] for the purpose of securing the due and punctual observance and performance by the Transferee of the provisions of this document and of the [1983 deed] on the Transferee's part to be performed and observed and authorises the [City] to lodge an absolute caveat pursuant to the Transfer of Land Act 1893 against the certificate of title to [lot 604] in order to protect the rights and interests of the [City] under this document.
Clause 4 provided:
The [bank] agrees with the [City] that:
(a)should the [bank] pursuant to the Mortgage exercise its rights to deal with [lot 604] … the [bank] shall perform and observe the provisions of this document and of the [1983 deed] on the Transferee's part to be performed and observed in like manner as if the [bank] was named in this document as the Transferee and in the [1983 deed] as the Original Owner; and
(b)the [bank] will not sell [lot 604] in exercise of its power of sale without at the same time obtaining the execution of an agreement between the proposed purchaser and the [City] whereby the proposed purchaser agrees to perform and observe the provisions of this document and of the [1983 deed] on the part of the Transferee and the Original Owner, respectively, to be performed and observed; and
(c)the [bank] will not assign the Mortgage or any of its rights thereunder without first procuring the execution by the proposed assignee of an agreement between the proposed assignee and the [City] whereby the proposed assignee agrees to perform and observe the provisions of this document on the part of the [bank] to be performed and observed.
Grounds of appeal
The appellants' grounds of appeal covered two topics. The first concerned the contention that the appellants were entitled to enforce the covenants in cl 2(d) and cl 2(e) of the 1983 deed as adopted in the 2010 deed, notwithstanding that they were not a party to either deed, by virtue of s 11(2) of the Property Law Act 1969 (WA) (PLA). The second concerned the contention that the first appellants were, alternatively, entitled to an easement for use of an area described as the 'Use Area' on lot 604, by reason of the doctrine of lost modern grant or prescription.
Covenants enforceable by virtue of s 11(2) of the PLA: grounds 1 and 2
In relation to the first topic, the appellants' grounds of appeal were to the following effect:
1.The judge erred in law in construing cl 2(d) and cl 2(e) of the 1983 deed, as adopted pursuant to cl 2 of the 2010 deed, as only containing covenants for the benefit of the City, when he ought to have construed those clauses as containing covenants directly for the benefit of the appellants. In this regard, his Honour erred in that:
(a)he construed cl 2(d) and cl 2(e) of the 1983 deed in the context of the common ownership of adjoining lots of land when the 1983 deed was entered into, when he should have construed those clauses in the context of the different ownership of the adjoining lots of land when the 2010 deed was entered into;
(b)he construed cl 2(d) and cl 2(e) of the 1983 deed by reference to cl 2(a) and cl 2(c) of the 1983 deed, when they address different subject matters; and
(c)to the extent of any ambiguity, he failed to construe cl 2(d) and cl 2(e) by reference to the common knowledge of the parties that the purpose of those clauses was to provide for 'cross‑easements' between parking and access areas on adjoining lots of land.
2.Further to ground 1, the judge erred in law in finding that the appellants were not entitled to enforce the covenants contained in cl 2(d) and cl 2(e) of the 1983 deed as adopted by cl 2 of the 2010 deed, when he should have found that the appellants were so entitled by virtue of s 11(2) of the PLA.
Easement by doctrine of lost modern grant or prescription: ground 3
The appellants' grounds of appeal in relation to the second topic were to the following effect:
3A.The judge erred in fact and in law in making the following findings which were not factual issues litigated at trial and not supported by the evidence:
(a)from 1986, the owners of lot 604 allowed the use of the Use Area because they understood that they were obliged to do so by the terms of their development approval; and
(b)Mr and Mrs Maio believed that they and their customers were entitled to use the Use Area by reason of the reciprocal rights contained in the development approval for the service station.
3B.The judge erred in fact and in law in finding that Mr and Mrs Maio were not entitled to an easement for the use of the Use Area for access, egress and parking by the occupiers of, and visitors to, the supermarket by reason of the doctrine of lost modern grant or prescription, on the basis that they and their visitors had not used the Use Area as a matter of right due. In that regard, his Honour:
(a)erred in fact as alleged in ground 3A;
(b)erred in law in finding that the terms of par 6 of the 1986 development approval created any access or parking rights which could be exercised by Mr and Mrs Maio and their visitors 'as of right'.
Section 11 of the PLA
Section 11 of the PLA provides:
11.Persons taking who are not parties
(1)A person may take an immediate or other interest in land or other property, or the benefit of any condition, right of entry, covenant or agreement over or respecting land or other property, although he is not named as a party to the conveyance or other instrument that relates to the land or property.
(2)Except in the case of a conveyance or other instrument to which subsection (1) applies, where a contract expressly in its terms purports to confer a benefit directly on a person who is not named as a party to the contract, the contract is, subject to subsection (3), enforceable by that person in his own name but -
(a)all defences that would have been available to the defendant in an action or proceeding in a court of competent jurisdiction to enforce the contract had the plaintiff in the action or proceeding been named as a party to the contract, shall be so available;
(b)each person named as a party to the contract shall be joined as a party to the action or proceeding; and
(c)such defendant in the action or proceeding shall be entitled to enforce as against such plaintiff, all the obligations that in the terms of the contract are imposed on the plaintiff for the benefit of the defendant.
(3)Unless the contract referred to in subsection (2) otherwise provides, the contract may be cancelled or modified by the mutual consent of the persons named as parties thereto at any time before the person referred to in that subsection has adopted it either expressly or by conduct.
The appellants' arguments in relation to grounds 1 and 2
The appellants' arguments are largely self‑evident from the grounds of appeal. The gravamen of the appellants' case in ground 1 is that by 2010, lots 602 and 604 were in different ownership and the successors in title to the ownership of lot 602 had become the registered proprietors of the strata plan by which the former lot 602 was subdivided. The appellants contend that:[25]
[T]he promises in clause 2(d) and 2(e), as adopted by the [second respondent] in the 2010 Deed, were immediate promises by the owner of lot 604 to the City:
(a)not to erect or permit to be erected a fence on or about the common dividing boundaries between the replacement strata plan for lot 602 and lot 604, or any of those boundaries, or otherwise obstruct or impede the free movement and thoroughfare of persons and vehicles on either of those lots or from one lot to the other;
(b)to grant to the owners of the lots on the strata plan replacing Lot 602, and their tenants, invitees, licensees, customers, visitors and lawful entrants, the right to use for the purpose of parking motor vehicles the car parking areas situated on Lot 604 together with full and unrestricted access from one lot to the other both vehicular and on foot;
(c)in the case of a sale of Lot 604, to reserve to the owners of the lots on the strata plan replacing Lot 602, and their tenants, invitees, licensees, customers, visitors and lawful entrants, the right to use for the purpose of parking motor vehicles the car parking areas situated on Lot 604 together with full and unrestricted access from one lot to the other both vehicular and on foot.
[25] Substituted appellants' submissions, par 50, WB 21 - 22.
The appellants contend that this construction of the 2010 deed arises from a consideration of the terms of the 2010 deed read with the 1983 deed, and that, to the extent of any ambiguity, that construction is confirmed by reference to extrinsic evidence to the effect that the purpose of cl 2(d) and cl 2(e) of the 1983 deed was to provide for 'cross‑easements' between parking and access areas of lots 602 and 604, and to ensure that subsequent purchasers were bound.[26] In this regard, the appellants referred to a letter from the City dated 9 November 1982[27] to the Original Owner's consultants to the effect that the City had adopted a recommendation of its planning committee in relation to the application to subdivide the subject land into, relevantly, lots 602 and 604. The letter stated:
[26] Substituted appellants' submissions, par 61, WB 24.
[27] GB 43 - 44.
This matter was considered at the November meeting of the Planning Committee and on 16th November, 1982 [the City] adopted the Committee's recommendation to the effect that the subdivision be recommended subject to a Legal Agreement, supported by a Caveat on the land including the following conditions: -
1.The new lot [lot 604] must not be developed for retail shops, except with the specific approval of [the City].
2.Any proposed development to be approved by [the City].
3.Cross‑easements between parking and access areas of the lots to be arranged to the satisfaction of the City.
4.The new lot [lot 604] is not to be sold unless the purchaser signs a similar agreement.
5.The development on the new lot [lot 604] to match the existing shopping centre in respect of design, colours and materials used.
6.The terms of the original contract to be varied, but only so far as to permit subdivision and separate development.
7.The Legal Agreement is to be at the owner's cost to the satisfaction of the City's Solicitors.
The appellants placed particular reliance on point 3 of the letter.
The appellants contend that this extrinsic evidence could be used to construe the 2010 deed in light of the English decision of KPMG LLP v Network Rail Infrastructure Ltd.[28] That case concerned the proper construction of a break‑clause in a reversionary sub‑underlease dated 11 July 1985 (1985 lease). The break‑clause contained words which were, in effect, inexplicable and incomprehensible in the context of the provision as a whole. The 1985 lease was executed following an earlier agreement to lease between the parties' predecessors in 1974 (1974 agreement) which annexed a draft of the lease upon which the 1985 lease was based. The break‑clause in the draft annexed to the 1974 agreement indicated that the equivalent term of the 1985 lease omitted material words, and that the omission explained what was otherwise the inexplicability of the provision in the 1985 deed. It was held that the draft lease annexed to the 1974 agreement was an important part of the background and a permissible aid in the construction of the 1985 lease in its final form.[29]
[28] KPMG LLP v Network Rail Infrastructure Ltd [2007] EWCA Civ 363.
[29] KPMG [43].
Accordingly, the appellants contend that, properly construed, the covenants contained in cl 2(d) and cl 2(e) of the 1983 deed, as adopted in the 2010 deed, conferred a benefit directly upon the appellants and that the appellants are entitled to enforce the covenants directly against the second respondent by reason of s 11(2) of the PLA.
Proper construction of the 1983 deed
Ultimately, the relevant issue of construction is the proper construction of the 2010 deed. However, that issue requires an understanding of the meaning and effect of the 1983 deed.
The rights and liabilities of parties under a contract are to be determined objectively: Codelfa Construction Pty Ltd v State Rail Authority of New South Wales;[30] Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd.[31] The common intention of the parties in this context is a reference to what a reasonable person would understand by the language in which the parties have expressed their agreement. The meaning of the terms of the contract is to be determined by what a reasonable person would have understood them to mean: Toll;[32] Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd.[33]
The 1983 deed - overview
[30] Codelfa Construction Pty Ltd v State Rail Authority of New South Wales [1982] HCA 24; (1982) 149 CLR 337, 352.
[31] Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165 [40].
[32] Toll [40].
[33] Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37; (2015) ALR 188 [47].
Read as a whole, the 1983 deed objectively indicates the following:
(a)An underlying premise is that the proposed lot 602 had already been substantially developed as a shopping centre precinct which, it may be inferred, was understood to be a major long‑term development (cl 2(c)).
(b)The adjacent land on proposed lot 604 was undeveloped (cl 2(a) and cl 2(c)).
(c)The City wished to effectuate control over the future development of adjacent proposed lot 604 in light of and harmoniously with the usage of the existing development on the land in proposed lot 602 (Recitals B ‑ D, cl 1 and cl 2 generally).
(d)A concern of the City was to manage the flow of vehicles to and within the overall corner site from which proposed lots 602 and 604 were to be created, including management of parking (cl 2(b), cl 2(d) and cl 2(e)).
(e)The City, by the covenants in its favour in the deed, wished to augment its ordinary statutory powers in relation to any future development on proposed lot 604 (cl 2 generally and particularly cl 2(a)).
(f)The control over development of the land on proposed lot 604 and its harmonious usage with the existing development on proposed lot 602 were to be effected by, inter alia, covenants to be given by the Original Owner whilst it remained the owner of the land the subject of proposed lots 602 and 604, including both prior to the creation of those lots and subsequent to their creation (cl 2(a) ‑ cl 2(d) and cl 2(f)).
(g)Where, following the creation of lots 602 and 604, the land in either of those lots first came to be held in different ownership, it was intended that the subsequent owners of the lots would themselves be bound by the City's development requirements contemplated by the deed, by directly covenanting with the City (cl 2(e) and, additionally in the case of lot 604, by cl 2(g)).
(h)The procedure for procuring subsequent owners of lots 602 and 604 to covenant directly with the City was to be effected by both negative and positive promises in the 1983 deed given by the Original Owner. The positive promise involved the Original Owner agreeing, upon first sale or transfer of either lot, to enter into an instrument of grant and reservation with the transferee, on terms that the transferee would itself directly covenant with the City, and on terms that it could only sell to subsequent transferees who were similarly prepared to covenant with the City (cl 2(e)). This was in addition to the negative promise, given by the Original Owner in favour of the City, precluding a sale or disposition of an interest in lot 604, unless the disponee executed a deed under which it, in effect, assumed corresponding obligations to the City (cl 2(g)).
(i)The Original Owner agreed, in effect, that following subdivision of the subject land and the creation of lot 604, lot 604 was to be charged by the Original Owner, in favour of the City, to secure the payment of any moneys payable by the Original Owner to the City and for the purpose of securing performance of the terms of the 1983 deed, and in that regard authorised the City to lodge a caveat on lot 604 to 'protect the rights and interests of the [City]' under the deed (cl 3).
It is convenient to examine in more detail the operation of cl 2(e) of the 1983 deed.
Clause 2(e) of the 1983 deed
The substantive promises in cl 2(e) of the 1983 deed were to operate on the first occasion that either proposed lot 602 or proposed lot 604 was sold by the Original Owner. That is apparent from the structure of the provision in general; the centrality to its operation of the grant and reservation, which is premised upon the Original Owner then being the owner of both proposed lots 602 and 604; and from the use of the word 'either'.
Assuming, for example, that lot 604 were first to have been sold, cl 2(e) provides, relevantly, that the Original Owner covenants with the City that upon the sale or transfer of lot 604 by the Original Owner, the Original Owner would:
(i)grant to the purchaser of lot 604 (and to its successors in title, tenants, assigns and licensees, etc) the right to use the car parking areas on lot 602 together with full and unrestricted vehicular and pedestrian access to lot 602 from lot 604;
(ii)reserve to itself, as owner of lot 602 (and to its successors in title, tenants, assigns and licensees, etc) the right to use the car parking areas on lot 604 together with full and unrestricted vehicular and pedestrian access to lot 604 from lot 602;
(iii)include in the grant and reservation referred to above, covenants, by the Original Owner and the transferee of lot 604, to the effect that each of the Original Owner and transferee of lot 604 covenants with the City:
Anot to fence the boundary between lots 602 and 604 or otherwise impede or obstruct free movement between the two lots;
Bnot to surrender or terminate the rights contained in either the grant or reservation without the City's prior written consent; and
Cnot to sell, agree to sell or otherwise dispose of its interest in the lot it owns (ie, relevantly, in the case of the Original Owner its interest in lot 602, and in the case of the transferee its interest in lot 604) unless the third party enters into a deed with the other parties to the 1983 deed (including the City) to 'observe and perform the provisions of [the 1983 deed]' including this covenant.
In relation to the term summarised in subpar (iii)C of the preceding paragraph above, the phrase 'observe and perform the provisions of [the 1983 deed]' means, in the context of the deed as a whole (particularly cl 2(a)), and insofar as it applies to the transferee of lot 604, the provisions of the 1983 deed concerning the use and development of lot 604.
On the assumption referred to in [40] above, as applied to the circumstance where the Original Owner sells lot 604 to a purchaser (first transferee of lot 604) and where the first transferee later sells to another person (subsequent transferee of lot 604), the 1983 deed contemplates that:
(a)the first transferee of lot 604 would covenant with the City:
(i)not to develop lot 604 without the City's consent which the City may, in its absolute discretion, refuse (cl 2(a) read with cl 2(g));
(ii)not to allow vehicular access to lot 604 from Cedric Street or to Cedric Street from lot 604 (cl 2(b) read with cl 2(g));
(iii)that, in carrying out any development of lot 604, it will ensure that the design and colours etc used in the development are the same as the shopping centre in lot 602 to give the appearance of a single complex (cl 2(c) read with cl 2(g));
(iv)not to fence the common boundary between the two properties or otherwise impede or obstruct free movement between lots 602 and 604 (cl 2(d) read with cl 2(g), as well as via cl 2(e)(i));
(v)not to surrender or terminate (or seek to do those things) its right of parking on with access to lot 602 under the Original Owner's grant referred to in cl 2(e), without the prior written consent of the City (cl 2(e)(ii));
(vi)not to revoke or terminate (or seek to do those things) the right of parking on with access to lot 604 given to the owner of lot 602 under the Original Owner's reservation referred to in cl 2(e), without the prior written consent of the City (cl 2(e)(ii)); and
(vii)not to transfer its interest in lot 604 to a subsequent transferee without the subsequent transferee entering into a deed of covenant with the City (and the Original Owner) to observe and perform the provisions of the 1983 deed concerning the use and development of lot 604, such deed to be prepared by the City's solicitors at the expense of the subsequent transferee (cl 2(e)(iii));
(b)the subsequent transferee of lot 604 would also be required to covenant with the City on the same terms referred to in (i) to (vii) above.[34]
[34] As to the terms in (i) ‑ (iv), see cl 2(a) ‑ cl 2(d) respectively, read with cl 2(e)(iii); as to the terms in (v) and (vi), see cl 2(e)(ii), read with cl 2(e)(iii); and as to the term in (vii), see cl 2(e)(iii).
Disposition - grounds 1 and 2 (s 11(2) of the PLA)
There are a number of reasons why the appellants' construction cannot be accepted. First, the appellants' contentions are inconsistent with the language of cl 2 of the 2010 deed, read as a whole, as discussed below.
The appellants' contention that cl 2 of the 2010 deed imports an 'immediate promise' by the second respondent as 'the owner of lot 604' to 'grant' to the proprietors of lot 602 strata lots proprietary rights over lot 604[35] cannot be accepted. The only immediate promise was to 'observe and perform' all the provisions in the 1983 deed 'in like manner as if the [second respondent] had been named as the Original Owner' in that deed. The Original Owner, in cl 2(e) of the 1983 deed, did not covenant to 'grant' to the successors in title to lot 602 rights over lot 604. Rather, it covenanted, upon the sale of lot 604 (in the event that lot 604 was sold ahead of lot 602), to 'grant' to the purchaser of lot 604 (and its successors etc), a right to car parking on, with access to, lot 602. In other words, with respect to the sale of lot 604, the 1983 deed contemplated the grant of a right over lot 602.
[35] The second of the three promises referred to in [30] above on the appellants' construction.
Similarly, the appellants' contention that cl 2 of the 2010 deed imports an 'immediate promise' by the second respondent as 'the owner of lot 604', upon the sale of lot 604, to 'reserve' to the proprietors of the lot 602 strata lots proprietary rights over and access to lot 604[36] cannot be accepted. The Original Owner covenanted, relevantly, in cl 2(e) of the 1983 deed that upon the sale of lot 604, it would 'reserve' to itself 'as owner of [lot 602]' (and its successors etc), a right to car parking on, with access to, lot 604. That promise was incapable of performance by the second respondent 'in like manner' as required by the 2010 deed. The Original Owner could only sensibly 'reserve' any right to itself as owner of lot 602 and for the benefit of its successors in title, if it was the owner of lot 602. That was not the position of the second respondent in 2010 and a reasonable person in the position of the parties to the 2010 deed would have understood cl 2 to apply to promises capable of future performance by the second respondent.
[36] The third of the three promises referred to in [30] above on the appellants' construction.
Also, similarly, the appellants' contention that under cl 2(d) as adopted in the 2010 deed there was an 'immediate promise' by the second respondent not to obstruct or impede the free movement of persons and vehicles between lot 602 and lot 604[37] cannot be accepted. The second respondent, as owner of lot 604, could not perform that provision 'in like manner' as if they were the Original Owner. That is because the second respondent was never the owner of both lots 602 and 604, and thereby could not prevent, in the manner contemplated by cl 2(d) as adopted in the 2010 deed, the successors in title to lot 602 from erecting barriers on their land, or otherwise preventing the free movement of persons and vehicles from lot 604 onto their land.
[37] The first of the three promises referred to in [30] above on the appellants' construction.
Secondly, a reasonable person in the position of the parties to the 2010 deed would not have understood that they agreed, by the language they used, to create proprietary rights in favour of the lot 602 strata lot holders. Whilst they agreed that the second respondent would observe and perform the promises in the 1983 deed in like manner as if they were the Original Owner, that was a deed entered into for the public purposes of orderly planning, and not for the creation of private rights. That is evident from its terms as a whole, its recitals and the statutory context in which the deed was executed. This is confirmed by cl 2(e)(ii) of the 1983 deed in particular, which is to the effect that subsequent transferees could neither surrender nor revoke the rights intended to be conferred by the grant and reservation contemplated under cl 2(e) without the prior written consent of the City. It is to be inferred from its statutory context, subject matter and terms as a whole, that the 2010 deed was correspondingly entered into for town planning purposes.
The absence of an objective intention to confer proprietary rights on the lot 602 strata lot holders is also confirmed by two other considerations. One is that the 2010 deed did not itself identify any car parking areas on lot 604 which were to be the subject of an easement appurtenant to the lot 602 strata lots, and the 1983 deed also provided no identification of the car parking areas intended to be the subject of the grant and reservation in cl 2(e). It is an unlikely intention to attribute to the parties in 2010 that the second respondent agreed, by cl 2 of the 2010 deed, to confer proprietary rights in favour of the lot 602 strata lot holders by way of an easement over lot 604, when neither the 2010 deed nor the 1983 deed identified the location of the car parking areas the subject of the alleged grant.
The other consideration (although it is not essential to the conclusion on this point) is that, had any proprietary rights been intended to be created in favour of the lot 602 strata lot holders, it would be expected that the City would have a contractual obligation, or at least an expressly conferred entitlement, to create an easement over lot 604 under the Transfer of Land Act 1893 (WA) (TLA). In 1983, an easement could be created by deed and notified to the registrar for the purpose of having it recorded on the certificate of title: s 63A and s 69 of the TLA as it then stood.[38] Also, by the date of the 2010 deed, following amendments to the TLA in 1996, there were a variety of statutory short form easements by transfer, including an easement for motor vehicle parking: s 65(3) of the TLA and Schedule 10.[39] Here, neither the 1983 deed nor the 2010 deed provided for the creation of an easement on lot 604 (or for that matter lot 602) under the TLA. Rather, the City's planning requirements were evidently intended to be effectuated by covenants directly with the City, and with the 'rights and interests' of the City protected by a caveat over lot 604 (cl 3 of the 1983 deed and cl 3 of the 2010 deed).
[38] See Francis E A, The Law and Practice Relating to Torrens Title in Australasia (1972) 514; Bradbrook AJ and MacCallum S V, Bradbrook and Neave's Easements and Restrictive Covenants (3rd ed, 2011) [11.8]. Note however that under the general law, an easement could only be created by deed of reservation if the reservation were contained in the conveyance and executed by the purchaser, in which case it would operate as a re‑grant by the purchaser: Kitching v Phillips [2011] WASCA 19; (2011) 278 ALR 551 [45]; Bradbrook A J and MacCallum S V, Bradbrook and Neave's Easements and Restrictive Covenants (3rd ed, 2011) [4.3]; Yip v Frolich [2004] SASC 287; (2004) 89 SASR 467 [64] - [90] (where the reservation was in the transfer document and not in a deed).
[39] Under the TLA in 1983 the only statutory short form easement was for a right of carriageway: s 65 TLA and Schedule 9. It is unnecessary to consider for present purposes whether and to what extent other easements could be created by transfer under the TLA as it then stood. See, however, generally s 63A, 65 and s 88A of the TLA and Francis E A, The Law and Practice relating to Torrens Title in Australasia (1972) 515 ‑ 516.
In oral submissions, the appellants contended that cl 2(e) of the 1983 deed contained an 'independent obligation' owed by the Original Owner as owner of lot 602 and another 'independent obligation' owed by the Original Owner as owner of lot 604.[40] That submission also cannot be accepted. There was only one obligation on the Original Owner in cl 2(e) of the 1983 deed. That was that upon the creation of lots 602 and 604 (they had not been created at the time of entering into the 1983 deed) the Original Owner would, as the owner of the two newly created lots, make the grant and reservation referred to upon the first sale of either lot.
[40] Appeal ts 83.
In oral submissions, the appellants also contended that 'if the court thought that it was relevant to giving the remedy' to the appellants in enforcing cl 2(e) against the second respondent, then the court could 'condition' the enforcement by requiring the appellants to 'enter into similar covenants'.[41] This further submission is inconsistent with the earlier one. If the appellants were correct and cl 2(e) contained independent obligations, there would be no basis for conditioning the enforcement of the appellants' independent right in that manner. In any event, the submission cannot be accepted as cl 2(e) did not impose on the Original Owner two independent obligations, one being an independent obligation as owner of lot 604, and the other being an independent obligation as owner of lot 602.
[41] Appeal ts 82 ‑ 83.
In relation to the extrinsic evidence referred to in [31] above, the appellants effectively invite the court to construe the City's statement in point 3 of its letter of November 1982 in order to construe the 1983 deed with a view to construing the 2010 deed. The statement in point 3 of the letter in 1982 reflected the planning committee's recommendation, as part of a suite of planning recommendations, that there be '[c]ross‑easements between parking and access areas of the lots to be arranged to the satisfaction of the City'.
Having regard to the terms of point 3 as a whole, its context within the letter as a whole, and its emanation from the City's planning committee, it appears to be no more than a statement about one topic intended to be covered by a legal agreement to give effect to planning concerns raised by the City's planning committee in relation to a particular development application. It could not properly be said to constitute a matter which identified the purpose or object of even the 1983 deed, let alone the 2010 deed. It was not a matter known to both parties at the time of entering into the 2010 deed. Insofar as it might be alleged that the 2010 deed was ambiguous, the evidence was accordingly inadmissible on the question of construction of the 2010 deed: Codelfa;[42] Mount Bruce.[43] Nor, to the extent relevant, was it a matter reasonably available to both parties in 2010.[44] Insofar as the English decision of KPMG relied on by the appellants is inconsistent with these High Court authorities, it cannot be followed[45] and, in any event, it is plainly distinguishable (see [33] above). Further, the 2010 deed is not ambiguous or susceptible to more than one meaning and thus cannot be contradicted by the use of extrinsic evidence.[46]
[42] Codelfa (352).
[43] Mount Bruce [50] (French CJ, Nettle & Gordon JJ), [108] (Kiefel & Keane JJ).
[44] Mount Bruce [120] (Bell & Gageler JJ)
[45] Royal Botanic Gardens and Domain Trust v South Sydney Council [2002] HCA 5; (2002) 240 CLR 45 [39].
[46] Codelfa (352); Mount Bruce [48].
Accordingly, on the proper construction of the 2010 deed, the promises in the 1983 deed which the second respondent agreed to perform were those contained in cl 2(a), cl 2(b) and cl 2(c) of the 1983 deed. They do not include cl 2(d) and cl 2(e) of the 1983 deed.
Grounds 1 and 2 should be dismissed for the above reasons, although a final matter may be noted.
The 2010 deed was executed as a deed. There is no mention of consideration provided by the City. Section 11(2) of the PLA applies to 'a contract'. The second respondent did not contend, either in this court or below, that the 2010 deed was not a 'contract' within the meaning of s 11(2) of the PLA.[47]
[47] cf The Bell Group (in liq) v Westpac Banking Corporation [No 9] and [No 10] [2008] WASC 239; (2008) 39 WAR 1 [3351] ‑ [3373].
Doctrine of lost modern grant or prescription
Introduction
Subject to one point the subject of grounds 3A and 3B, the judge found that the appellants had established the elements necessary to demonstrate the existence of an easement by virtue of the doctrine of lost modern grant or prescription.[48]
[48] Primary reasons [51] ‑ [73].
The easement which the judge found could have been established but for the point under appeal, was related to an area which he described as the 'Use Area' and related to the use of the Use Area for access, egress and parking by occupiers of and visitors to the supermarket in favour of the registered proprietors of the land on which the supermarket was situated, ie, Mr and Mrs Maio.[49]
[49] Primary reasons [67].
The point on which the appellants failed was that they had not established that the use of the Use Area occurred 'as of right'.[50]
The appellants' arguments
[50] Primary reasons [89] ‑ [92].
In ground 3A, the appellants contend that his Honour made findings relevant to the subjective state of mind of the owners of lot 604 and of Mr and Mrs Maio when those matters were not litigated. The appellants contend that his Honour found that:
(a)the owners of Lot 604 during the period of the service station allowed the use of the Use Area because they understood that they were obliged to do so by the terms of their development consent; and
(b)the Maios believed that they and their customers were entitled to use the Use Area by reason of the reciprocal rights contained in the development consent for the service station.[51] (emphasis added)
[51] Substituted appellants' submissions, par 72; WB 25 ‑ 26.
In ground 3B, the appellants contend that the judge implicitly found that the development approval of August 1986 created reciprocal parking and access rights, whereas on its proper construction, it required the owner of lot 604 to 'maintain' reciprocal parking and access rights. It is alleged that par 6 of the development approval was, in its context, properly construed as a reference to the 1983 deed, and that the rights referred to in the development approval were rights derived from the 1983 deed.
The development approval
For the purpose of considering this ground, it is useful to set out the following relevant passages of the development approval:[52]
[52] GB 91.
Approval to commence development in accordance with the Application dated 15 JUL 1986 is granted subject to the Schedule of Conditions specified hereunder.
This approval is valid for a period of two years only. If development is not completed within this period, a fresh approval must be obtained before commencing or continuing development.
…
Should the applicant be aggrieved by this decision, a right of appeal may exist pursuant to the provisions of Clause 33 of the Metropolitan Region Scheme or Clause 1.6 of the City of Stirling District Planning Scheme No 2, as the case may be. Such an appeal shall be made in accordance with Part V of the Town Planning and Development Act 1928 (as amended).
SCHEDULE OF CONDITIONS
…
3The Service Station being constructed in the same materials and in a similar design as the adjoining Shopping Centre.
4All access to the site to be via Sanderling Street. Egress only to Cedric Street in accordance with the City Engineer's requirements.
5The extension of the island in Cedric Street south past the egress point with associated road widening to the satisfaction of the City Engineer.
6.Reciprocal parking and access rights with the adjoining Shopping Centre to be maintained. No boundary fencing to be erected between the Service Station and Shopping Centre.
The Use Area and its use - the judge's findings
The Use Area as found by the judge was not identical with the parking area in use on lot 604 as it existed at the time of the 1983 deed or at the time that Mr and Mrs Maio purchased strata plan lot 6. The judge found, in effect, that between 1983 and 1986 lot 604 was used for parking by the visitors to the supermarket on the eastern side of lot 604 and the southern side of lot 604. However, between August 1986 and April 1987 the service station was constructed on lot 604 and, as a result, the parking bays on the southern boundary of lot 604 were removed.[53]
[53] Primary reasons [64] ‑ [65].
His Honour found that, following construction of the service station, parking bays on the eastern part of lot 604 were used by patrons of the shopping centre to park their cars. He also found that part of lot 604 was used by the patrons of the shopping centre to go into and out of parking areas and to manoeuvre their vehicles into parking bays and to park their vehicles in parking bays. His Honour found the 'Use Area' to include both the driveway areas and the parking bays on lot 604 used by visitors to the shopping centre on lot 602.[54]
[54] Primary reasons [66].
Sometime before 29 August 1994 there was a complaint to the City that posts and chains had been installed on the western side of the service station on lot 604 which denied egress from the south‑western car parking area of the shopping centre onto Cedric Street. On 29 August 1994, the City wrote to the then owner of lot 604 requiring that the barrier be removed immediately on the ground that planning approval for the service station development included the condition that reciprocal parking and access rights for the adjoining shopping centre be maintained and that no boundary fence be erected between the two.[55]
The judge's findings in relation to use 'as of right'
[55] Primary reasons [88].
The judge said that it had not been established that the lot 602 strata lot owners, or the owner of lot 604, 'considered' (or believed) that the lot 602 strata lot owners had a right of way and parking over lot 604 granted by the 1983 deed.[56]
[56] Primary reasons [73].
In relation to the proposal to develop lot 604 as a service station, the judge found, in effect, that:
(a)In January 1985, consultants on behalf of the owners of lot 604 applied to the City for rezoning of lot 604[57] for the development of a service station and presented a proposal of an integrated development of lots 602 and 604 with reciprocal parking on the two lots.[58]
(b)On 21 March 1985, the City informed the consultants that the City was prepared to initiate rezoning procedures in order to permit the proposed use as a service station subject to the written acceptance and compliance of conditions, including the condition that reciprocal parking and access rights to the shopping centre be maintained.[59]
(c)On 18 August 1986, the City approved development of lot 604 as a service station, subject to conditions including the reciprocal parking rights condition. The City's prior approval to commence development was required pursuant to cl 1.3.4.1 of the 1985 City of Stirling District Planning Scheme No 2 (TPS 2), which relevantly provided that the City could grant approval with or without conditions.[60]
[57] See GB 87.
[58] Primary reasons [85].
[59] Primary reasons [86].
[60] Primary reasons [86]; item 32, agreed chronology, WB 78; GB 91 – 94. The date of the application by Mr and Mrs Siciliano to develop a service station was 15 July 1986, see GB 91.
The judge further found that in December 1985, when Mr and Mrs Maio purchased strata plan lot 6, Mr Maio was informed by the selling agent that 'there were reciprocal rights between Lots 602 and 604'.[61]
[61] Primary reasons [87].
The judge found that:[62]
(a)at least from August 1986 to 2008 when the service station was demolished, the owner of lot 604 was required by the development approval from the City to maintain reciprocal parking and access rights with the shopping centre on lot 602;
(b)it was a condition of the development approval that the owner of lot 604 would permit the proprietors of the lot 602 strata lots to use the Use Area for parking and access; and
(c)the owner of lot 604 permitted the use of that lot for access and parking because it was required to do so as a condition of its development approval under TPS 2, which had full force and effect as if it were enacted by the Town Planning and Development Act and the rights of the proprietors of the lot 602 strata lots were derived from that Act.
[62] Primary reasons [89].
His Honour also found:[63]
(a)Mr and Mrs Maio believed that occupiers and visitors to the shopping centre had 'a right to use the Use Area not by reason of a right acquired by prescription but by reason of "reciprocal rights"'; and
(b)the reciprocal rights derived from the development approval conditions which were of limited duration and ceased to apply when the service station was demolished.
[63] Primary reasons [90].
His Honour accordingly found that:[64]
(a)Mr and Mrs Maio used the Use Area in enjoyment of a publicly based licence or permission to do so which ultimately arose under the Town Planning and Development Act and that the right being exercised was a right of limited duration.
(b)The owner of lot 604 did not relevantly acquiesce in the use of that lot for parking and access and it was not reasonable for it to stop the use of the Use Area because the owner of lot 604 was precluded from doing so under the condition attached to the development approval given to build and operate the service station and that condition was enforced by the City in 1994 when the owner of lot 604 put up a barrier to obstruct egress from the shopping centre, across lot 604, onto Cedric Street.
Principles
[64] Primary reasons [88], [91].
The judge observed, without challenge in this appeal, that easements may be acquired by prescription under the doctrine of lost modern grant or the Prescription Act 1832 (UK) which was adopted in this State in 1836 by 6 Will IV No 4.[65] The doctrine of lost modern grant was not affected or repealed by the Prescription Act, which did little more than restate the doctrine in statutory form. His Honour added that, for present purposes, it did not matter whether the easements were created under the doctrine of lost modern grant or the Prescription Act because differences between the two were immaterial on the facts of this case and that both doctrines require proof of 20 years continuous user as of right.
[65] Primary reasons [48].
Prescription was introduced into the law for the public benefit so that rights of property 'might not be for ever uncertain': Delohery v Permanent Trustee Co of New South Wales.[66] In general terms, prescription is founded on the premise that where a court finds an open and uninterrupted use of A's property by B for a long period unexplained, the court will, if reasonably possible, find a lawful origin for the use in question: Attorney‑General v Simpson;[67] Delohery;[68] Bakewell Management Ltd v Brandwood.[69] In other words, in these circumstances, the law will 'clothe the fact with right': Moody v Steggles.[70]
[66] Delohery v Permanent Trustee Co of New South Wales [1904] HCA 10; (1904) 1 CLR 283, 308, read with 300.
[67] Attorney‑General v Simpson [1901] 2 Ch 671, 698.
[68] Delohery (308).
[69] Bakewell Management Ltd v Brandwood [2004] 2 AC 519 [49].
[70] Moody v Steggles (1879) 12 Ch D 261, 265.
The use must be 'as of right': R v Oxfordshire County Council, Ex parte Sunningwell Parish Council;[71] Piromalli v Di Masi.[72] In order to be 'as of right', the use must be inconsistent with any other reasonable inference, as if the use is equally consistent with two reasonable inferences, user 'as of right' is not established: Gardner v Hodgson's Kingston Brewery Co Ltd;[73] Patel v W H Smith (Eziot) Ltd.[74]
[71] R v Oxfordshire County Council, Ex parte Sunningwell Parish Council [2000] 1 AC 335, 351.
[72] Piromalli v Di Masi [1980] WAR 173, 176, 178.
[73] Gardner v Hodgson's Kingston Brewery Co Ltd [1903] AC 229, 239.
[74] Patel v W H Smith (Eziot) Ltd (1987) 1 WLR 853, 860.
In R (Barkas) v North Yorkshire County Council,[75] Lord Neuberger (with whom four other members of the court agreed) said:[76]
The origin of the expression 'as of right' … effectively for present purposes … was authoritatively discussed by Lord Hoffmann in R v Oxfordshire County Council, Ex p Sunningwell Parish Council[2000] 1 AC 335 … As he said, it originates from the law relating to the acquisition of easements by prescription. Before examining what Lord Hoffmann said, it is, I think, helpful to explain that the legal meaning of the expression 'as of right' is, somewhat counterintuitively, almost the converse of 'of right' or 'by right'. Thus, if a person uses privately owned land 'of right' or 'by right', the use will have been permitted by the landowner - hence the use is rightful. However, if the use of such land is 'as of right', it is without the permission of the landowner, and therefore is not 'of right' or 'by right', but is actually carried on as if it were by right - hence 'as of right'. The significance of the little word 'as' is therefore crucial, and renders the expression 'as of right' effectively the antithesis of 'of right' or 'by right'.
In his discussion on the point in Ex p Sunningwell, Lord Hoffmann began by explaining that 'Any legal system must have rules of prescription which prevent the disturbance of long-established de facto enjoyment' (p 349), and went on to explain that a combination of statutory and common law had resulted in such enjoyment having to be 20 years 'nec vi, nec clam, nec precario: not by force, nor stealth, nor the licence of the owner': p 350. He went on to explain that each of 'these three vitiating circumstances' would amount to 'a reason why it would not have been reasonable to expect the owner to resist the exercise of the right', namely, 'in the first case, because rights should not be acquired by the use of force, in the second, because the owner would not have known of the user and in the third, because he had consented to the user, but for a limited period': p 351. For the avoidance of doubt, I should interpose that the reference to 'a limited period' clearly includes an indefinite period (as would arise under an unlimited but revocable permission), and that the word 'limited' was meant to be contrasted with 'permanent'. Lord Hoffmann ended his discussion by citing with approval Lord Lindley's statement in Gardner v Hodgson's Kingston Brewery Co Ltd[1903] AC 229, 239 that 'the words "as of right" were intended "to have the same meaning as the older expression nec vi, nec clam, nec precario"', a view also expressed by Lord Davey at p 238.
…
In Sunningwell [2000] 1 AC 335 … Lord Hoffmann indicated that whether user was 'as of right' should be judged by 'how the matter would have appeared to the owner of the land', a question which must, I should add, be assessed objectively. (emphasis added)
[75] R (Barkas) v North Yorkshire County Council [2015] AC 195.
[76] Barkas [14], [15], [21].
His Lordship, in the same case,[77] also quoted Gale on Easements[78] to the effect that 'acquiescence is the foundation of prescription' and referred to the observations of Fry J in Dalton v Henry Angus & Co.[79]
[77] Barkas [17].
[78] Gaunt JR and Morgan P, Gale on Easements (19th ed, 2012) par 4‑115.
[79] Dalton v Henry Angus & Co (1881) 6 App Cas 740, 774.
In Dalton, Fry J said:[80]
The Courts and the Judges have had recourse to various expedients for quieting the possession of persons in the exercise of rights which have not been resisted by the persons against whom they are exercised, but in all cases it appears to me that acquiescence and nothing else is the principle upon which these expedients rest. It becomes then of the highest importance to consider of what ingredients acquiescence consists. In many cases, as, for instance, in the case of that acquiescence which creates a right of way, it will be found to involve, 1st, the doing of some act by one man upon the land of another; 2ndly, the absence of right to do that act in the person doing it; 3rdly, the knowledge of the person affected by it that the act is done; 4thly, the power of the person affected by the act to prevent such act either by act on his part or by action in the Courts; and lastly, the abstinence by him from any such interference for such a length of time as renders it reasonable for the Courts to say that he shall not afterwards interfere to stop the act being done … but I cannot imagine any case of acquiescence in which there is not shewn to be in the servient owner; 1, a knowledge of the acts done; 2, a power in him to stop the acts or to sue in respect of them; and 3, an abstinence on his part from the exercise of such power. That such is the nature of acquiescence and that such is the ground upon which presumptions or inferences of grant or covenant may be made appears to me to be plain, both from reason, from maxim, and from the cases.
As regards the reason of the case, it is plain good sense to hold that a man who can stop an asserted right, or a continued user, and does not do so for a long time, may be told that he has lost his right by his delay and his negligence, and every presumption should therefore be made to quiet a possession thus acquired and enjoyed by the tacit consent of the sufferer. But there is no sense in binding a man by an enjoyment he cannot prevent, or quieting a possession which he could never disturb. (emphasis added)
[80] Dalton (773 ‑ 775).
Fry J in Dalton also referred to the observations of Thesiger LJ in Sturges v Bridgman,[81] where his Lordship said, in delivering the judgment of the Court of Appeal:
Consent or acquiescence of the owner of the servient tenement lies at the root of prescription, and of the fiction of a lost grant, and hence the acts or user, which go to the proof of either the one or the other, must be, in the language of the civil law, nec vi nec clam nec precario; for a man cannot, as a general rule, be said to consent to or acquiesce in the acquisition by his neighbour of an easement through an enjoyment of which he has no knowledge, actual or constructive, or which he contests and endeavours to interrupt, or which he temporarily licenses. It is a mere extension of the same notion, or rather it is a principle into which by strict analysis it may be resolved, to hold, that an enjoyment which a man cannot prevent raises no presumption of consent or acquiescence. (emphasis added)
Disposition
[81] Sturges v Bridgman (1879) 11 Ch D 852, 863 ‑ 864.
Ground 3A neither accurately nor completely identifies the relevant findings of the primary judge on this issue, which are summarised in [66] ‑ [71] above. The judge did not confine himself to questions of state of mind, but considered all the circumstances of the case and the question of whether it was reasonable to infer acquiescence. Acquiescence, as noted above, is the root of prescription and is to be determined objectively.
The primary judge concluded that acquiescence could not be inferred in circumstances where the development approval for the use of lot 604 as a service station required the owner of lot 604 to permit the shopping centre to have access to and car parking on that lot on the basis that the shopping centre would permit reciprocal access and car parking. His Honour canvassed the events commencing in January 1985 when the consultants of the owners of lot 604 first applied for development approval in relation to the service station and the City advised that reciprocal car parking rights would be required; to 1986 when development approval was granted on the condition that the owners of lot 604 allow, in effect, the shopping centre to have access to and parking on lot 604 on a reciprocal basis; through to 1994 when the City enforced that condition of the development approval against the owners of lot 604 following an alleged breach of the condition.
These matters were litigated at trial. The permitted use of lot 604 as a service station pursuant to which the appellants were granted access was referred to in the second respondent's pleadings[82] and oral submissions.[83] Also, the underlying facts were largely agreed and the relevant documents were tendered.[84] The finding that the appellants believed that visitors to the shopping centre had a right to use the Use Area was based on Mr Maio's evidence‑in‑chief about what he was told by the selling agent in 1985.[85]
[82] Re‑amended defence and counterclaim of the second defendants, par 23F(b)A, BB 85.
[83] ts 46, 152 ‑ 153; GB 2, 13 ‑ 14.
[84] GB 87 ‑ 99; items 104 ‑ 110, agreed facts, GB 155 ‑ 156.
[85] Primary reasons [87], [90]; witness statement of Girolamo Maio, par 31, GB 25.
There has been no denial of natural justice. Ground 3A should be dismissed.
Ground 3B alleges, relevantly, that the judge 'erred in law in finding that the terms of paragraph 6 of the 1986 development approval created any access or parking rights which could be exercised by the first appellants and their visitors "as of right"'. In relation to ground 3B, the appellants contend that, properly construed, cl 6 of the 1986 development approval for lot 604 referred to rights 'derived from the 1983 Deed'.[86]
[86] Substituted appellants' submissions, par 84, WB 28.
Ground 3B has, at its centre, a misconception of the judge's finding. The judge did not find that par 6 of the 1986 development approval for lot 604 created any access and parking rights which could be exercised by Mr and Mrs Maio and their visitors 'as of right'. To the contrary, the judge found that Mr and Mrs Maio and their visitors had used lot 604 for parking and access in effect by right, as a result of the application and observance of the planning condition imposed on lot 604.
Further, the premise underlying any alleged right by prescription must be that the 1983 deed did not confer rights on the lot 602 strata holders. Accordingly, the rights referred to in the development approval could not, objectively, have been rights 'derived from the 1983 Deed' as alleged by the appellants in their written submissions.
In oral submissions, the appellants appeared to contend as follows. Condition 6 of the development approval did not impose an obligation to allow the supermarket to use lot 604 for parking and access, on a reciprocal basis, but was merely a requirement to comply with the 1983 deed, and if that deed, on its proper construction, imposed no obligation to permit access and parking on lot 604, then the point of the condition had misfired, and lot 604 could lawfully be used in a way which precluded any access to it from the shopping centre. In that context, in the absence of the lot 604 owner precluding access onto lot 604 from the shopping centre, it is to be inferred that the lot 604 owner acquiesced in the use, and thereby the use was 'as of right'.
The premise of those submissions, namely that Condition 6 was not the source of an obligation on the owners of lot 604 to permit the shopping centre to have access to, and parking on, lot 604, should be rejected. There is no mention of compliance with the 1983 deed in the 1986 development approval. Indeed, there is no mention of the 1983 deed at all. The development approval set out, separately, in the schedule of conditions, each of the matters upon which the City's consent was conditional. The schedule of conditions covered topics broadly similar to the topics covered by the 1983 deed. It did so comprehensively and without reference to, or incorporation of, the terms of the 1983 deed. Further, both the City and Mr and Mrs Siciliano may be taken to have known that there had not been a grant and reservation of rights by the Original Owner as contemplated by the 1983 deed upon either the sale of the lot 602 strata lots, or upon the sale of lot 604. It cannot be supposed that Condition 6 was intended to require the performance of a provision that was then no longer capable of operation.
Finally, the appellants' submission has an air of unreality about it. Adopting and adapting the language of Lord Macnaghten in Gardner,[87] when all the evidence, including the development approval, is considered objectively, there was no need to resort to a presumption of lawful use arising by prescription when 'the facts of the case, so far as they [were] known, suggest[ed] a much simpler and a more natural explanation'.
[87] Gardner (235).
The 'much simpler and … more natural explanation' for the use of lot 604 for access and parking by the shopping centre was that it was subject to a planning condition which required the owners of lot 604 to make the site available for access and parking purposes, on a reciprocal basis with the shopping centre. That was the more probable or, at the very least, the equally available inference in all the circumstances of the case, determined objectively.
Accordingly, the appellants could not succeed on their claim with respect to prescription, either on the basis that a corresponding inference should be drawn that the owners of lot 604 permitted that lot to be used for those purposes in compliance with the condition of planning approval (apart from the incident in 1994 which merely underscores the point), or because an inference of acquiescence may not be drawn where the owner of the servient tenement cannot prevent the use in question.
The primary judge did not err as alleged in ground 3B. That ground should also be dismissed.
Conclusion
The appeal should be dismissed. It is unnecessary to deal with the second respondent's notice of contention to the effect that there are, in any event, discretionary grounds upon which relief should be withheld.
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
TITLE OF COURT : THE COURT OF APPEAL (WA)
CITATION: MAIO -v- CITY OF STIRLING [No 2] [2016] WASCA 45 (S)
CORAM: MARTIN CJ
BUSS P
MURPHY JA
HEARD: ON THE PAPERS
DELIVERED : 16 MARCH 2016
PUBLISHED : 17 AUGUST 2017
FILE NO/S: CACV 92 of 2015
BETWEEN: GIROLAMO MAIO
First-named First Appellant
GLENYS JOY MAIO
Second-named First AppellantJVR PTY LTD
Second AppellantLINEMARK INVESTMENTS PTY LTD
Third AppellantTHE OWNERS OF STIRLING VILLAGE STRATA PLAN NO 11718
Fourth AppellantAND
CITY OF STIRLING
First RespondentVALMARL PTY LTD
First-named Second RespondentPETER GRAHAM HEARN
Second-named Second RespondentBANK OF QUEENSLAND
Third RespondentRAINWAVE NOMINEES PTY LTD
Fourth Respondent
ON APPEAL FROM:
Jurisdiction : SUPREME COURT OF WESTERN AUSTRALIA
Coram :LE MIERE J
Citation :MAIO -v- CITY OF STIRLING [No 2] [2015] WASC 189
File No :CIV 2706 of 2013
Catchwords:
Practice and procedure - Application for special costs order - Application out of time - Application for extension of time - Turns on own facts
Legislation:
Interpretation Act 1984 (WA), s 5, s 66
Legal Practice Act 2003 (WA), s 215(2)
Legal Profession Act 2008 (WA), s 280
Rules of the Supreme Court 1971 (WA), O 1 r 4A, O 1 r 4B, O 3 r 5(1), O 3 r 5(2), O 66 r 51(2), O 66 r 10(2)
Supreme Court (Court of Appeal) Rules 2005 (WA), r 5(1)
Supreme Court Act 1935 (WA), s 7(1)(b), s 20(2), s 37(1)
Result:
Application dismissed
Category: B
Representation:
Counsel:
First-named First Appellant : Mr J Thomson SC
Second-named First Appellant : Mr J Thomson SC
Second Appellant : Mr J Thomson SC
Third Appellant : Mr J Thomson SC
Fourth Appellant : Mr J Thomson SC
First Respondent : Mr K Pettit SC & Mr P Wittkuhn
First-named Second Respondent : Mr D Jackson
Second-named Second Respondent : Mr D Jackson
Third Respondent : No appearance
Fourth Respondent : No appearance
Solicitors:
First-named First Appellant : Haydn Robinson
Second-named First Appellant : Haydn Robinson
Second Appellant : Haydn Robinson
Third Appellant : Haydn Robinson
Fourth Appellant : Haydn Robinson
First Respondent : McLeods Barristers & Solicitors
First-named Second Respondent : Hotchkin Hanly Lawyers
Second-named Second Respondent : Hotchkin Hanly Lawyers
Third Respondent : No appearance
Fourth Respondent : Hotchkin Hanly Lawyers
Case(s) referred to in judgment(s):
Burrell v The Queen [2008] HCA 34; (2008) 238 CLR 218
In Ortin, two of the defendants failed to seek a special costs order at the time of judgment on 16 August 2002. On 28 October 2002, they filed a chamber summons for an order to extend time for seeking special costs orders. The failure to apply for a special costs order at the time of judgment was due to the ignorance of the lawyer acting for the two defendants. The judge (McKechnie J) followed Snowtop and allowed the application.
In relation to the proposition that the appellants are not prejudiced by Valmarl's late application, Valmarl submits that the appellants' special leave application was not determined until 1 September 2016. This is said to be relevant because '[t]o avoid incurring unnecessary costs' Valmarl's bill for taxation was not prepared until after the special leave application was dismissed.[108] It is submitted that after the special leave application was dismissed, attempts were made to engage with the appellants in relation to costs.[109] It is submitted that it was reasonable for Valmarl to wait to prepare the bill until after the determination of the special leave application and the subsequent attempt at conferral.[110] The difference in claim limits between items 23(e) and 10(a) was not identified until the bill was prepared.[111]
[108] Valmarl's submissions, pars 16 - 19.
[109] Valmarl's submissions, par 20.
[110] Valmarl's submissions, par 23.
[111] Valmarl's submissions, par 22.
Valmarl also submits that it was relevant that, by reason of the appellants' High Court special leave application, the 'proceedings had not been finally determined'. Valmarl referred in this regard to Geneva Finance Ltd (Receiver and Manager Appointed) v Resource & Industry Ltd.[112] In that case, costs orders were made by the primary judge on 24 May 2002 and entered on 7 June 2002. No special costs order was relevantly sought when judgment was given. After the expiration of the 30‑day period following the date of judgment delivery, an application was made for an extension of time to apply for a special costs order. The application was heard by the primary judge on 9 October 2002. The application was granted because the litigation was complex and it had not been 'finally determined' because the plaintiff had instituted an appeal.[113]
[112] Valmarl's submissions, par 19; Geneva Finance Ltd (Receiver and Manager Appointed) v Resource & Industry Ltd [2002] WASC 121 (S).
[113] Geneva Finance [6].
Valmarl also submits, in effect, that the appellants have filed no evidence of prejudice, and that prejudice cannot be inferred merely by the fact of the delay.[114]
[114] Valmarl's submissions, par 17.
As to the merits of the application, Valmarl submits that in the present case the parties regarded the subject matter of the litigation giving rise to the Court of Appeal's judgment as 'being of particular importance or significance'.[115] This is because each party regarded the outcome as being of great importance commercially.[116] Reference was made to Heartlink. The importance of the matter to each party is said to be demonstrated by the fact that senior counsel were engaged.[117] The matter was also required to be dealt with on an urgent basis.[118] Valmarl submits, in effect, that had an application for a special costs order been made at the time costs orders were being finalised, it would have been granted.[119]
[115] Valmarl's submissions, par 25.
[116] Valmarl's submissions, par 27.
[117] Valmarl's submissions, par 28.
[118] Valmarl's submissions, par 29.
[119] Valmarl's submissions, par 30.
Appellants' submissions
It is submitted that O 66 r 51 of the RSC is not engaged, on the basis that this order 'only applies where costs have not been ordered or where costs have been reserved'.[120] No authority or explanation for that submission was provided. In the alternative, it is submitted that if the order does apply then, in the exercise of its discretion, the court should not extend the time for the application to be made by Valmarl.[121] Furthermore, it is submitted that if the appellants' special leave application were relevant, then the present application should have been made by 1 October 2016, at the latest.[122]
[120] Appellants' submissions, par 5.
[121] Appellants' submissions, par 6.
[122] Appellants' submissions, par 9.
It is submitted that Valmarl's solicitor should be made responsible for the 'oversight' regarding the scale of costs limits as '[t]here is no excuse' for Valmarl's solicitor not being aware of the relevant scale limits.[123]
[123] Appellants' submissions, pars 10 - 12.
It is submitted, in effect, that the appellants would have opposed an application relating to the scale limits even if it had been made within time,[124] and that it is by no means probable that an order of the kind now sought would have been made if the application had been made within time.[125]
[124] Appellants' submissions, par 13.
[125] Appellants' submissions, par 14.
The appellants submit that there was no unusual difficulty, complexity or importance in the stay application. The stay was simply for the purpose of preventing the appeal from being rendered nugatory.[126]
[126] Appellants' submissions, par 15.
It is submitted, in effect, that the form of the costs orders was agreed on 15 March 2016, and yet Valmarl did not put the court in a position to be able to deal conclusively with all costs matters when it reserved its judgment.[127] It is submitted that the failure to address on costs may properly be taken by a court as an indication that no special or unusual costs orders are required.[128] In this regard, the appellants referred to Grygiel v Baine [No 2][129] and Stambulich v Ekamper [No 4].[130]
[127] Appellants' submissions, pars 16 - 17, citing Marrickville Municipal Council v Moustafa (No 2) [2002] NSWCA 179.
[128] Appellants' submissions, par 18.
[129] Grygiel v Baine [No 2] [2005] NSWCA 434.
[130] Stambulich v Ekamper [No 4] [2008] WASCA 189.
Disposition
The parties treated Valmarl's application as an application for a special costs order in the sense of an order to enable departure from the ordinary application of the relevant scale. These reasons proceed on that basis.
It is apparent that the Full Court in Snowtop proceeded on the bases that:
(a)the words 'some special certificate for costs' in O 66 r 51(2) included a reference to a special costs order;
(b)the court has power to make a special costs order pursuant to O 66 r 51(2), notwithstanding that other, non‑special costs orders have been made, or made and perfected, providing that (and subject to (c) below) the application is made within 30 days of the date on which the orders for judgment were made; and
(c)the court may, under O 3 r 5, extend the time for making an application beyond the 30‑day period referred to in O 66 r 51(2).
The reasons given by the court in Snowtop did not address the question of whether 'some special certificate for costs' extends to include an order lifting a limit imposed by an item in the scale contained in the fourth Schedule to the Rules of Court. That appears to be a matter which was assumed, rather than considered. Despite that lack of apparent consideration, the decision in Snowtop had been relied on in a number of cases in the General Division in 2002 and 2003 for the proposition that applications for special costs orders come within the terms of O 66 r 51(2): Ortin; Geneva Finance; and Re City of Joondalup; Ex parte Mullaloo Progress Association Inc.[131]
[131] Re City of Joondalup; Ex parte Mullaloo Progress Association Inc [2003] WASCA 293 (S).
However, all of those cases preceded the significant change effected in 2003, when the scales of cost were taken out of the Rules of Court and published pursuant to delegated legislation made by the Costs Committee created under the Legal Practice Act 2003 (WA) (now repealed). That Act contained s 215, which was in substantially similar terms to s 280 of the LP Act currently in force. There may be a question as to whether, since those provisions came into effect, after 2003, the provisions of that legislation should be regarded as governing the circumstances and the occasions upon which orders may be made lifting the limits imposed by items in the scales published under that Act. In particular, there may be a question as to whether the words 'Where under these rules a party is required to obtain some special certificate for costs' in O 66 r 51(2) should be construed as applying to an order made pursuant to s 280 of the LP Act. These matters were raised in a decision not referred to by the parties: Siam Steel International PLC v Compass Group (Australia) Pty Ltd.[132] In that case, Martin CJ expressed the opinion that O 66 r 51(2) 'may well be a relic of a bygone costs era with little or no current application'.[133]
[132] Siam Steel International PLC v Compass Group (Australia) Pty Ltd [2017] WASC 137 [30] ‑ [32].
[133] Siam Steel [32].
If s 280 of the LP Act covers the field, and O 66 r 51(2) is a relic of a bygone era with no current application, once costs orders have been made and extracted, the only basis upon which a further order could be sought is by the application of the slip rule.
On the other hand, in Cockburn Cement Ltd v The Minister for Environment (WA),[134] Edelman J expressed the opinion, with reference to Snowtop, that even under the current legislative scheme (s 280 of the LP Act), O 66 r 51(2) has the effect that a party has liberty to apply for special costs orders within 30 days, even if earlier costs orders have been made and extracted, and that recourse to the slip rule is unnecessary.
[134] Cockburn Cement Ltd v The Minister for Environment (WA) [2011] WASC 260 (S) [3], [26] ‑ [42], [51].
Neither the decision in Siam Steel, nor the decision in Cockburn Cement, was cited by the parties in this application. It is unnecessary to form a concluded view for present purposes on the question of whether O 66 r 51(2) continues to have any application, particularly in circumstances where costs orders have been made and extracted. This application should be dismissed in any event on discretionary grounds for the following reasons (which assume, without deciding, the continued application of O 66 r 51(2)).
The decision in Snowtop, which preceded the introduction of O 1 r 4A and r 4B of the RSC, did not purport to state exhaustively the discretionary considerations that may be relevant in an application to extend the time provided for in O 66 r 51(2). The court's discretion to extend time is to be exercised in the interests of justice, having regard to the particular circumstances of the case. Ordinarily, relevant considerations will include (1) the extent of the delay and the reasons for it; (2) any prejudice to the party seeking the extension if it is not granted and any prejudice to the other party if it is; (3) a proper recognition of the principles of finality in the context of the administration of justice; (4) due observance of the goals and objectives enshrined in O 1 r 4A and r 4B of the RSC; and (5) the underlying merits of the application.
As to the third of those matters, the observations of the High Court (albeit in a different context) in Burrell v The Queen[135] are pertinent:
[135] Burrell v The Queen [2008] HCA 34; (2008) 238 CLR 218 [15] - [16].
[I]t is important to recognise that [there] are fundamental principles about finality of litigation. As was said in D'Orta-Ekenaike v Victoria Legal Aid [(2005) 223 CLR 1 [34]]: 'A central and pervading tenet of the judicial system is that controversies, once resolved, are not to be reopened except in a few, narrowly defined, circumstances.' That tenet finds reflection in rules concerning the bringing of an action to set aside a final judgment on the ground that it was procured by fraud and in doctrines of res judicata and issue estoppel. The principal qualification to the general principle of finality is provided by the appellate system. But in courts other than the court of final resort, the tenet also finds reflection in the restrictions upon reopening of final orders after they have been formally recorded.
… [T]he principle of finality serves not only to protect parties to litigation from attempts to re-agitate what has been decided, but also has wider purposes. In particular, the principle of finality serves as the sharpest spur to all participants in the judicial process, judges, parties and lawyers alike, to get it right the first time. Later correction of error is not always possible. If it is possible, it is often difficult and time-consuming, and it is almost always costly. (footnotes omitted)
Also, in Esther Investments Pty Ltd v Markalinga Pty Ltd,[136] Malcolm CJ held that it was not necessary to find delay coupled with prejudice before dismissing a late application for a special costs order (in that case, over three years delay), and said:
[136] Esther Investments Pty Ltd v Markalinga Pty Ltd (1992) 8 WAR 400, 409.
There must come a point where the interests of finality of litigation militate against the exercise of discretion in favour of a party whose solicitors or counsel have failed by inadvertence to make an appropriate application at the appropriate time.
…
[T]here is an interest in the finality of litigation, and a party is entitled to order its affairs on the basis of a judgment regularly obtained, entered and perfected in the court.
In that case, his Honour also said, in effect, that if prejudice to the other party were required to be established, it could be inferred that the other party would suffer prejudice if the long‑standing state of affairs created by the judgment were departed from.[137]
[137] Esther (409).
In relation to the fourth‑mentioned matter, the observations of the court in Kidd v The State of Western Australia,[138] are pertinent:
[138] Kidd v The State of Western Australia [2015] WASCA 62 (S) [1] - [2].
Recent times have seen increasing enthusiasm for parties to proceedings in the civil jurisdiction of this court to engage in protracted disputes with respect to costs following determination of the appeal. Sometimes those disputes involve an assertion that there should be a departure from the ordinary rule that costs follow the event, because the generally successful party has failed on an issue or issues, with the consequence that the successful party should recover only part of their costs. Sometimes the disputes involve an assertion that there should be an order pursuant to s 280 of the Legal Profession Act 2008 (WA) directing that the costs of one or more parties be taxed without regard to the limits imposed by particular items in the relevant costs determination. Commonly the parties to such disputes will endeavour to support their position in long and detailed written submissions supported by substantial affidavits. This is such a case.
Satellite litigation of this kind is contrary to the overarching principles specified in O 1 r 4A and 4B of the [RSC] which govern all civil proceedings in the court. Such litigation has a very real capacity to consume resources of the parties and the limited resources of the court to an extent which is entirely disproportionate to the significance of the issues involved. Protracted disputes with respect to costs should be discouraged, and this court has revised its procedures to facilitate the resolution of all issues with respect to costs at the time of publication of the court's reasons, wherever possible. (footnote omitted)
In relation to the question of delay, the first point to note is that all appropriate costs orders should ordinarily be applied for upon the disposition of an appeal to this court, irrespective of the potential for an application by the losing party for special leave to appeal to the High Court.[139] Insofar as O 66 r 51(2) continues to apply, it allows for the contingency that a successful party, on attending and taking judgment, may overlook the need for special costs orders, and permits an application to be made within 30 days.[140] However, that contingency ought not, ordinarily, arise where the parties have been given an advance copy of the reasons for judgment and have been directed to consider all appropriate dispositive orders, including orders for costs. In this case, Valmarl has allowed a further (approximately) eight months to elapse before making this application. That is a considerable delay, particularly in a context where the appeal itself was heard and determined in less than two months.
[139] Streeter v Western Areas Exploration Pty Ltd [No 2] [2011] WASCA 17 (S) [40].
[140] Geneva Finance [4] - [5].
Further, in this case, in accordance with the court's practice in appropriate cases, an advance copy of the reasons was given to the parties, and the court directed the parties' attention to the need to consider all relevant dispositive orders, including costs orders. The parties had adequate opportunity to consider the ramifications of the judgment in order to apply for all appropriate final orders, including costs orders, on the formal delivery of judgment, and more than ample opportunity before the expiration of the 30‑day period specified in O 66 r 51(2). In this context, it is difficult to justify a departure from the conventional position that a party is bound by the conduct of its agents (solicitors).
In interlocutory matters on the way towards the final disposition of proceedings, it may (depending on all the circumstances) be contrary to the interests of justice to visit on a litigant the unintended, adverse, consequences of the neglect of the litigant's solicitor. However, considerations of that kind have less significance after the proceedings have been fought and dismissed on their merits, and then been the subject of an appeal, as here. The observations of Basten JA (with whom Mason P & Bryson JA agreed) in Grygiel are apposite:[141]
[141] Grygiel [12] ‑ [13].
The burden on the Court of applications to address further in relation to costs after judgment is significant. Inadvertence on the part of the legal representatives will generally not be a sufficient basis for permitting further submissions, even in writing, and certainly not a basis for a further hearing, as appears to have been proposed in the present case.
The expeditious despatch of the business of the Court depends to a significant extent on the Court being able to rely upon practitioners appearing before it to ensure that its attention is drawn to matters relevant to the determination of the proceedings.
On the question of prejudice, it is accepted that Valmarl would suffer some degree of prejudice if the extension were not granted, and if the underlying application had merit, although the amount in question (up to $7,700) is unlikely to loom large in the context of the likely costs of the litigation as a whole. The appellants cannot reasonably claim prejudice on the basis that they have arranged their affairs on the strength of the orders made in March 2016, given the relatively small amount involved, and given their conduct in seeking to overturn those orders in the High Court.
Regarding the principle of finality, there is no right of appeal to the High Court, and the prospect that the losing party might seek special leave to appeal (as eventuated here) does not mean that the proceedings had not been 'finally determined'[142] by the court's orders in March 2016. The finality principle has particular importance in the context of the disposition of an appeal by this court. Further, as indicated in Kidd, belated disputes of this kind are to be discouraged. They are contrary to the overarching principles specified in O 1 r 4A and r 4B of the RSC.[143] In this case, it is a fair inference that any financial advantage from the special costs order sought has already been significantly if not substantially eroded by the costs of this application.
[142] cf Geneva Finance [6].
[143] Kidd [2].
The above considerations combine to indicate that there should be no extension of time granted in this case. That is so, irrespective of whether the underlying application has merit, which it does not. Valmarl's solicitor has not deposed to the fact (if it be the fact) that the costs incurred by Valmarl in the stay application exceeded the scale limit. The statement in Valmarl's solicitor's letter of 16 November 2016 is not evidence of the fact. Further and in any event, even if the matter were of particular importance to the parties, as contended by Valmarl, we are not persuaded that its importance contributed to any exceeding of the scale limit in respect of what was a routine stay application.
Valmarl's application should be dismissed with costs.
12
22
4