Polaris Properties (WA) Pty Ltd as trustee for the Polaris Trust v Pickworth - [2019] WASC 119

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   POLARIS PROPERTIES (WA) PTY LTD as trustee for THE POLARIS TRUST -v- PICKWORTH [2019] WASC 119
CORAM:   SMITH J
HEARD:   27 FEBRUARY 2019
DELIVERED          :   16 APRIL 2019
FILE NO/S:   CIV 1996 of 2017
BETWEEN:   POLARIS PROPERTIES (WA) PTY LTD as trustee for THE POLARIS TRUST
Plaintiff
AND
JENNIFER JANE PICKWORTH
First Defendant
JAMES DAVID BOWMAN
Second Defendant

Catchwords:

Practice and procedure - Order 31 r 2 of the Rules of the Supreme Court - Application for preliminary determination of questions of law

Lots in a strata scheme - Alleged implied statutory easement for utility purposes - Doctrine of easement by prescription by lost modern grant - Ancillary (statutory) rights - Ancillary rights to easement by lost modern grant

Relevant facts unable to be assumed - Stated case procedure not appropriate - Turns on own facts

Legislation:

Rules of the Supreme Court 1971 (WA), O 31 r 2, O 32 r 4
Strata Titles Act 1966 (WA), s 6, s 8
Strata Titles Act 1985 (WA), s 11, s 13

Result:

Application dismissed

Category: B

Representation:

Counsel:

Plaintiff	:	Mr M D Cuerden SC
First Defendant	:	In person
Second Defendant	:	Not applicable

Solicitors:

Plaintiff	:	Hager Grubb & Partners Lawyers
First Defendant	:	In person
Second Defendant	:	Not applicable

Case(s) referred to in decision(s):

Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334
BCBC Singapore Pte Ltd v PT Bayan Resources TBK [No 2] [2012] WASC 321
Bolivia Republic v National Bolivian Navigation Co (1876) 24 WR 361
Landsdale Pty Ltd v Moore [2009] WASCA 176
Maludra Pty Ltd v The Owners of Windsor Towers Strata Plan 80 [2017] WASAT 112
Owners of Strata Plan 502756 v Thoo [2013] NSWCA 270
R v Rigby [1956] HCA 38; (1956) 100 CLR 146
Regional Power Corporation v Pacific Hydro Group Two Pty Ltd [2013] WASC 46
Tepko Pty Ltd v Water Board [2001] HCA 19; (2001) 206 CLR 1

SMITH J:

Application to determine preliminary questions of law

The first defendant has applied under O 31 r 2 of the Rules of the Supreme Court 1971 (WA) for the preliminary determination of the following questions of law:[1]
[1] Defendant's chamber summons for application for case stated, filed 13 November 2018, 5 - 6.
QUESTION 1
Based on the Assumption below, were the New Pipes (installed by the Plaintiff in late 2009/2010 along the New Pipe Route) in and through
(a)Unit 1 (Storeroom and airspace in Unit 1 Land); and
(b)common property in the Ithaki Building
the subject of an implied easement for the passage of water, sewerage and drainage, benefitting the Plaintiff as proprietor of Unit 2 and as appurtenant to Unit 2, as against the Defendant as proprietor of Unit 1 and to which Unit 1 was subject and as against common property, pursuant to
(c)Sections 6 (1) (a) (ii), (b) (ii) and/or 8 of the 1966 Act (as continued by the 1985 Transitional Provisions); and/or
(d)Sections 11 (1) (a) (ii), (b) (ii) and /or 13 of the 1985 Act?
Assumption
For the purposes of the determination of Question 1 only, it is assumed that the Original Pipes connected to 8 Original Fixtures in the Original Bathrooms and penetrated into the Unit 1 Storeroom, as pleaded by the Plaintiff in
(a)paragraph 6A of the Amended Substituted Writ; and
(b)paragraph 2 (b) (ii) and (iii) of the Plaintiff’s Amended Reply
until their dis-connection by the Plaintiff in late 2009/2010 and cessation of use.
QUESTION 2
Can an easement for the passage of water, sewerage and drainage through the Original Pipes in Unit 1 be founded in
(a)prescription; and/or
(b)lost modern grant
when the exercise of such easement rights by the Plaintiff (and its predecessors in title) during the period 1977 until disconnection of the Original Pipes by the Plaintiff in late 2009/2010, was based on an easement implied by Section 6 of the 1966 Act (as continued by the 1985 Transitional Provisions)?
QUESTION 3
Did the New Pipes installed by the Plaintiff in late 2009/2010 in the Unit 1 Storeroom (which pipes exclusively serviced Unit 2) form part of Unit 1 and comprise property of the Defendant?
I am of the opinion that the application should be dismissed on grounds:
(a)the questions posed by the first defendant cannot be determined in other than a hypothetical manner, as the material facts said to be agreed cannot (when regard is had to the pleadings) be assumed to be agreed; and
(b)in any event there is little utility in determining the three questions as preliminary questions of law.

Legal principles - preliminary determinations of questions of law

In order to make a direction under O 31 r 2, it must appear to the court (that is, the court must be satisfied) that there is a question of law which it would be convenient to have decided (relevantly) before any evidence is given or any question of fact is tried.
The starting point is that as a general rule, all issues of fact and law should be determined at the one time, and the preliminary determination of a point of law is nevertheless a significant departure from the usual way of proceeding, and the discretion to proceed in that way should be exercised with commensurate caution.[2]
[2] See generally Tepko Pty Ltd v Water Board [2001] HCA 19; (2001) 206 CLR 1, 55 (Kirby & Callinan JJ); Landsdale Pty Ltd v Moore [2009] WASCA 176 [20] - [21] (Newnes JA; Buss JA agreed); BCBC Singapore Pte Ltd v PT Bayan Resources TBK [No 2] [2012] WASC 321 [26(i)] (Pritchard J).
The question, or questions, of law must necessarily arise in the proceeding.[3]
[3] Bolivia Republic v National Bolivian Navigation Co (1876) 24 WR 361, 362 applied in Regional Power Corporation v Pacific Hydro Group Two Pty Ltd [2013] WASC 46 [25(b)] (Kenneth Martin J).
The court cannot give an advisory opinion or answer hypothetical questions.[4] The question, or questions, of law should be formulated in the order with precision and it should be a question or questions which, on the admitted facts, will finally dispose of the action or of an identifiable cause of action within it.[5]
[4] Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334 [47] ‑ [48] (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne & Callinan JJ).
[5] Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334 [49] (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne & Callinan JJ); BCBC Singapore Pte Ltd v PT Bayan Resources TBK [No 2] [2012] WASC 321 [26(ii)] (Pritchard J).
Upon a case stated, the court cannot determine questions of fact and it cannot draw inferences of fact from what is stated in the case.[6] The court's authority is limited to ascertaining from the contents of the case stated what are the ultimate facts, and not the evidentiary facts, from which the legal consequences ensue that govern and determine the rights of the parties.[7] Thus, relevant facts must be identified with precision.[8]
[6] R v Rigby [1956] HCA 38; (1956) 100 CLR 146, 150 - 151 (Dixon CJ, McTiernan, Webb, Kitto & Taylor JJ).
[7] R v Rigby [1956] HCA 38; (1956) 100 CLR 146, 151 (Dixon CJ, McTiernan, Webb, Kitto & Taylor JJ).
[8] Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334 [49] ‑ [54] (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne & Callinan JJ).
Whilst there is power in an appropriate case to order the preliminary determination of a question of mixed fact and law under O 32 r 4, not O 31 r 2, it is necessary that there be precision both in formulating the question and in specifying the facts upon which the preliminary determination is to be decided. Care must be taken to ensure that all facts, that are on any fairly arguable view relevant to the determination of the preliminary question, are ascertainable as facts assumed to be correct for the purposes of the preliminary determination, or as facts that both sides accept as correct, or as facts which are to be judicially determined.[9]
[9] Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334 [53] (Gleeson, CJ, Gaudron, McHugh, Gummow, Hayne & Callinan JJ).

General background

The plaintiff is, and has been since 14 April 2009, the registered proprietor of Unit 2/60 North Street, Cottesloe (Unit 2). The first defendant is, and has been since 26 November 2010, the registered proprietor of Unit 1/60 North Street, Cottesloe (Unit 1). On 21 March 2018, the first defendant transferred a one per cent interest in Unit 1 to her son, the second defendant.
The first defendant acted in person at the hearing of this application. The first defendant is on the roll of legal practitioners but is now retired and no longer practising as a lawyer.
Units 1 and 2 comprise one building and were constructed in or about 1976 or 1977 on a parcel of land in two lots (lot 1 and lot 2) together with common property. Lots 1 and 2 were registered as strata plan 4712 under the Strata Titles Act 1966 (WA) (1966 Act) on 1 April 1977.
On 20 March 2009, lots 1 and 2 were re‑subdivided under the Strata Titles Act 1985 (WA) (1985 Act) by which lots 1 and 2, and all of the common property external to the building, were re-subdivided into lots 3 and 4 in a strata scheme.
It is common ground that from registration of the strata plan in 1977 until about 2009, there was an easement over the original pipes used by the occupiers of Unit 2 for the passage of water, sewerage and drainage, which pipes exited two bathrooms through the concrete slab into the storeroom below in Unit 1.[10]
[10] ts 11, 27 February 2019.
The pipes installed in or about 1977 will be referred to as the 'original pipes' in these reasons. Pipes installed in late 2009 or early 2010 will be referred to as the '2009 pipes'.
In late 2009, the plaintiff carried out renovations to two bathrooms in Unit 2, above the storeroom in Unit 1, in which the plaintiff removed the original pipes and installed the 2009 pipes. The renovations carried out by the plaintiff to Unit 2 resulted in the demolition of two small bathrooms in order to create one bathroom within the space of the former bathrooms.
It is also common ground that in 2017, the first defendant disabled and then caused the removal of the 2009 pipes which connected fixtures in the plaintiff's new bathroom to the sewer.

The pleaded cases

To determine this application regard must be had to relevant pleadings of the parties in respect of the location of water and sewerage pipes connected to Unit 2.
The plaintiff pleads that there is, and was, an easement implied by s 11 of the 1985 Act (alternatively, by s 6(a)(ii) of the 1966 Act) in favour of the plaintiff, as the proprietor of Unit 2, and as appurtenant to Unit 2, as against the defendants, as the proprietors of Unit 2, for the passage of water, sewerage and drainage through or by means of pipes.
Section 11 of the 1985 Act is, relevantly, identical to s 6 of the 1966 Act.
Section 11 of the 1985 Act provides:
11. Support and services
(1)In respect of each lot there shall be implied -
(a)in favour of the proprietor and as appurtenant to his lot -
(i)an easement for the subjacent and lateral support thereof by the common property and by every other lot capable of affording support; and
(ii)easements for the passage or provision of water, sewerage, drainage, gas, electricity, garbage, artificially heated or cooled air, heating oil and other services including telephone, radio and television services, through or by means of any pipes, wires, cables or ducts for the time being existing in the land comprising the parcel to the extent to which those pipes, wires, cables or ducts are capable of being used in connection with the enjoyment of that lot;
(b)as against the proprietor and to which his lot shall be subject -
(i)an easement for the subjacent and lateral support of the common property and of every other lot capable of enjoying support; and
(ii)easements for the passage or provision of water, sewerage, drainage, gas, electricity, garbage, artificially heated or cooled air, heating oil and other services including telephone, radio and television services, through or by means of any pipes, wires, cables or ducts for the time being existing within that lot, as appurtenant to the common property and also to every other lot capable of enjoying such easements.
(2)A proprietor, mortgagee in possession or occupier of a lot shall not do any thing or permit any thing to be done on or in relation to that lot so that -
(a)any support or shelter provided by that lot for another lot or common property is interfered with; or
(b)the passage or provision of water, sewerage, drainage, gas, electricity, garbage, artificially heated or cooled air, heating oil and other services, including telephone, radio and television services, through or by means of any pipes, wires, cables or ducts for the time being in the lot is interfered with.
In the alternative, the plaintiff pleads an easement by prescription, by lost modern grant, on the basis that the original pipes were installed in 1977 and the 2009 pipes (until removed by the first defendant in 2017) were in use on an uninterrupted basis for the passage of water, sewerage and drainage.[11]
[11] Plaintiff's further re-amended substituted statement of claim, filed 13 December 2018 [7] - [9].
The plaintiff also pleads that the easement carried with it all ancillary rights reasonably necessary to make the easement effective.[12] The ancillary rights pleaded by the plaintiff, relied upon in its claim for an implied easement, arise by operation of s 13 of the 1985 Act or alternatively by s 8 of the 1966 Act.[13] Insofar as the plaintiff's claim is founded in an easement by prescription, by the doctrine of lost modern grant, it is claimed that that doctrine also carries with it ancillary rights reasonably necessary to make the easement effective.
[12] Plaintiff's further re-amended substituted statement of claim, filed 13 December 2018 [6C] – [6D].
[13] Plaintiff's further re-amended substituted statement of claim, filed 13 December 2018 [6C].
Section 13 of the 1985 Act is, relevantly, identical to s 8 of the 1966 Act.
Section 13 of the 1985 Act provides:
13. Ancillary rights
All ancillary rights and obligations reasonably necessary to make them effective belong to easements implied or created by this Act.
In respect of the plaintiff's claim for ancillary rights, the plaintiff claims that the replacement of the original pipes in or about late 2009 was an exercise of ancillary rights necessary for the exercise and enjoyment of that easement.[14] In particular, the plaintiff says that those ancillary rights included the right to replace, or cause to be replaced, the original pipes and/or to install, or cause to be installed, new pipes in the same or substantially the same location as, or a location similar to, that in which the original pipes had been installed. Further, and in the alternative, those ancillary rights included the right to install pipes in a location which was no more intrusive to Unit 1 than that in which the pipes had been installed prior to in or about late 2009.[15]
[14] Plaintiff's outline of submissions in opposition to defendant's application by way of case stated, filed 9 November 2018 [40].
[15] Plaintiff's outline of submissions in opposition to defendant's application by way of case stated, filed 9 November 2018 [32].
The plaintiff's pleadings that are relevant to the determination of the first defendant's application for a preliminary trial of questions of law are as follows:[16]
(a)the new bathroom was, and is, located in the same area as the original bathrooms;
(b)the renovations did not involve the replacement of any part of the pipes passing between the external airspace and soil to connect to the sewer;
(c)the location, configuration, functions, dimensions and extent of the 2009 pipes were the same, or substantially the same as, or were in a similar location, configuration, functions, dimensions and similar to the extent of the original pipes they replaced; and
(d)alternatively to (c) the functions, dimensions and extent of the 2009 pipes were such that they were less, or at least no more, intrusive than the pipes which ran through the internal concrete slab (between Unit 2 and Unit 1).
[16] Plaintiff's amended reply and defence to counterclaim, filed 6 July 2018 [2(c)].
In summary, the defendants plead:
(a)immediately prior to and on and from registration of the strata plan in 1977, until the 2009 pipes were installed, the original pipes were constructed of cast iron or brass and either:[17]
[17] Defendants' re-amended defence and counterclaim, filed 15 January 2019 [5(b)(iii) - (iv)].
(i)exited the original bathrooms out through the external wall of the original bathrooms on level 1, or into and out of the cement slab, to enter the common property, land airspace and soil, to connect to the sewer; or
(ii)penetrated through the cement slab into the storeroom in Unit 1 where they were attached to the storeroom ceiling;
(b)the 2009 pipes were constructed with PVC and following completion of the renovation in mid‑2009, the 2009 pipes connected the new bathroom fixtures in Unit 2 to the sewer situated in Unit 1 land as follows:[18]
(i)three of the 2009 pipes penetrated through the cement slab common property into the full length of the storeroom where they merged into one main pipe and exited out of the common property external wall and passed through Unit 1 land (airspace and soil) to connect to the sewer;
(ii)one of the 2009 pipes penetrated through the cement slab common property approximately mid‑point into the storeroom, and exited the external wall common property and passed through Unit 1 land (airspace and soil) to connect to the sewer;
(iii)one other 2009 pipe connected to the vanity basin in the new bathroom and penetrated into and exited out of the level 1 external wall common property and passed through Unit 1 land (airspace and soil) to connect to the sewer; and
(iv)as part of, or ancillary to, the renovation, the plaintiff caused or authorised the disconnection, and permanent removal and non‑replacement of the original plumbing system except for decommissioning and abandonment in situ of two original pipes in the storeroom attached to the storeroom ceiling, being two s-bends.
[18] Defendants' re-amended defence and counterclaim, filed 15 January 2019 [5(c)(iv)] - [5(d)(ii)].
The defendants also plead that:[19]
(a)the original pipes in Unit 1 and common property land were pipes for the time being existing 'lawfully in the land comprising the parcel' and the subject of an easement implied by s 6(a)(ii) of the 1966 Act for the benefit of Unit 2 as against Unit 1; and
(b)the original pipes carried ancillary rights to 'repair and replace' under s 8 of the 1966 Act, or s 13 of the 1985 Act, but it is denied that the ancillary rights were properly exercisable by the plaintiff (in late 2009 or during 2010).
[19] Defendants' re-amended defence and counterclaim, filed 15 January 2019 [6B(b)] - [6C(a)]
The defendants claim that whilst it is conceded that the original pipes were the subject of an implied easement, the installation of the 2009 pipes were not subject to an implied easement under s 11 of the 1985 Act on grounds:[20]
(a)the 2009 pipes were not 'in the land comprising the parcel' for the purposes of s 11(1)(a)(ii) of the 1985 Act; and
(b)the 2009 pipes were not 'structural cubic space' or any other form of common property and did not benefit or service any common property, and were not appurtenant to any common property, as required by s 11(1)(b)(ii) of the 1985 Act; or
(c)alternatively:
(i)the implied easement was abandoned or extinguished upon the disconnection and permanent removal, or decommissioning and abandonment, of the original pipes and the original plumbing system;
(ii)the installation of a new plumbing system, including the 2009 pipes were installed in a different manner, and in significant different locations to the original plumbing system, and the new plumbing system involved a significantly greater intrusion into Unit 1 and loss of amenity in the storeroom in Unit 1.
[20] Defendants' re-amended defence and counterclaim, filed 15 January 2019 [6(c)] - [6(d)].

As to the plaintiff's claim that an easement arises by prescription by the doctrine of lost modern grant, the defendants plead that:[21]
(a)the plaintiff is unable to establish an easement on this ground as the plaintiff used the original pipes 'by way of right' (with permission) and not 'as of right' (without permission) and with the consent, licence and permission of the first defendant's predecessor in title (until the original pipes were disconnected, permanently removed and not replaced or decommissioned and abandoned in situ);
(b)the easement was abandoned;
(c)in any event, the pipes were not in continuous use for at least 20 years prior to the commencement of the action;
(d)the 2009 pipes were either an unlawful encroachment in or on Unit 1 or a part of the property of the first defendant; and
(e)the plaintiff did not use the 2009 pipes on and from installation with the acquiescence of the first defendant or the first defendant's predecessor in title.
[21] Defendants' re-amended defence and counterclaim, filed 15 January 2019 [7] ‑ [9].
As to the plaintiff's claims of ancillary rights, the defendants plead that the 2009 pipes were not permitted by any ancillary right. In particular, the original pipes were not 'repaired or replaced' by the 2009 pipes.[22]
[22] Defendants' re-amended defence and counterclaim, filed 15 January 2019 [9.D(a)].
Further, the defendants plead that any consent or acquiescence given by the first defendant's predecessor in title, or her duly authorised agent, to the 2009 pipes being installed in a different location to the original pipes, did not and cannot operate so as to deem the 2009 pipes to be replacements of the original pipes, or create a new implied easement under the 1985 Act, or vary or modify the implied statutory easement in connection with the original pipes.[23]
[23] Defendants' re-amended defence and counterclaim, filed 15 January 2019 [6.D(b)].
In the alternative, if an easement by prescription by lost modern grant did exist, the proprietor of Unit 1 (personally or by her agent) did not consent to the exercise of ancillary rights to the unlawful installation of the 2009 pipes.[24]
[24] Defendants' re-amended defence and counterclaim, filed 15 January 2019 [9.D(b)].

The 'facts' the first defendant contends can be assumed to be correct and agreed

It is difficult to assume that all material facts relevant to the questions of law that the first defendant seeks to have determined as preliminary questions are agreed facts. When proper regard is had to the pleadings it cannot be said that there is agreement as to facts relevant to the questions.
Under the heading 'Assumption' in question 1, the first defendant particularises the facts to be assumed by (regard to) the pleading by the plaintiff in [2(b)(i)] and [2(b)(iii)] of the plaintiff's amended reply and defence to counterclaim filed on 6 July 2018 (the reply).
However, in [2(b)(ii)] of the reply, the plaintiff pleads, in response to [5(b)(ii)] of the defendant's amended defence, that there was only one floor waste in one of the original bathrooms, that there were two floor wastes, one in each original bathroom.[25] Disagreement on this fact could be material as it is an issue that goes to the location of the 2009 pipes.
[25] Filed on 28 May 2019.
In her written submissions, the first defendant sought to identify a number of facts, under a heading 'Agreed Facts', which the first defendant contended are agreed on the pleadings by reference to particular paragraphs of the defendant's amended defence and counterclaim filed on 28 May 2018 and the plaintiff's reply.[26]
[26] Application by defendant pursuant to Order 31 r 2 (submissions), filed 26 October 2018 [3] wherein the defendant identifies [1] - [6], [6B], [6D], [7] and [8] of the defendant's amended defence and counterclaim, filed 28 May 2018 and [1] - [3], [10], [12], [14] and [15] of the plaintiff's amended reply and defence to counterclaim, filed 6 July 2018. In these reasons I have also had regard to the defendants' re-amended defence and counterclaim, filed 15 January 2019, although no material amendments were made to the foregoing paragraphs identified in the defendants' submissions which were filed prior to filing the re‑amended defence and counterclaim.
However, the matters pleaded in the defendant's amended defence and counterclaim and the plaintiff's reply must also be read together with the plaintiff's further re‑amended substituted statement of claim filed on 13 December 2018. When all of the pleadings are read together it clearly emerges that:
(a)there is material disagreement as to the location, configuration, functions, dimensions and extent of the original pipes, the original plumbing system, the 2009 pipes and the 2009 plumbing system; and
(b)some of the facts referred to by the first defendant under the heading 'Agreed Facts' in her written submissions are incomplete.
The plaintiff also contends that the first defendant's summary inaccurately summarises some factual matters.
The first defendant's summary of 'Agreed Facts' also includes references to facts said to be agreed that are established by a number of the defendants' discovered documents. However, none of the documents referred to by the first defendant are before the court because the first defendant did not file an affidavit in support of her application to have the three questions of law raised for the opinion of the court by means of a special case.
When this point was put to the first defendant during the hearing of this application, the first defendant informed the court that it is not necessary to have regard to the discovered documents,[27] and the only relevant facts are those that follow, and which can be readily assumed to be agreed, from the plaintiff's pleaded case and from admissions made by the defendants as follows:[28]
(a)the defendants admit the original pipes were the subject of an implied easement under s 6(a)(ii) of the 1966 Act and that the easement was continued by the transitional provisions of the 1985 Act;
(b)it can be assumed that there were eight original bathroom fixtures and eight original pipes that were connected to fixtures that penetrated the concrete slab between Unit 1 and Unit 2 into the storeroom of Unit 1;
(c)the defendants plead and the plaintiff admits in reply that the original two bathrooms in Unit 1 were demolished and one new bathroom created in the (merged) space of the original bathrooms by the installation of five fixtures and five 2009 pipes; and
(d)of the five 2009 pipes, four pipes penetrated the concrete slab and one pipe exited through the bathroom wall of Unit 2 into Unit 1 airspace and soil.
[27] ts 12, 27 February 2019.
[28] ts 11 - 14, 27 February 2019.
However, when the pleadings are reviewed, the facts which the first defendant says can be assumed in (b) and (d) cannot be said to be agreed facts that are capable of being assumed.
In respect of [40(b)] this 'agreed' fact is not a fact that can be drawn from the pleadings. Although the plaintiff pleaded that there were eight original pipes that ran through the internal concrete slab, they also pleaded in the alternative that there were six original pipes that penetrated the internal concrete slab in [2(c)(iv)] of their reply and defence to counterclaim, filed on 8 November 2017. However, the plaintiff does not now plead this to be the case in their amended reply and defence to counterclaim, filed on 6 July 2018.[29] In any event, the defendants do not specifically plead how many original pipes penetrated the internal concrete slab.
[29] Plaintiff's amended reply and defence to counterclaim, filed 15 January 2019 [2(c)(iv)].
As to the location of the 2009 pipes, the assumption in [40(d)] is contrary to the facts pleaded in [2(c)(iii)B] of the plaintiff's reply. The plaintiff pleads in [2(c)(iii)B] that the renovations in or about late 2009 did not involve the replacement of pipes passing between the external airspace and soil to connect to the sewer.
When regard is had to the contest in the pleadings over these material facts, it would be inappropriate for this court to finally determine questions of law, or questions of mixed fact and law, on the basis of an incomplete factual basis and ignoring contested facts asserted by the plaintiff. To do so is an obvious denial of procedural fairness. The fundamental principle identified in Bass v Permanent Trustee Co Ltd is that:[30]
Judicial power involves the application of the relevant law to facts as found in proceedings conducted in accordance with the judicial process. And that requires that the parties be given an opportunity to present their evidence and to challenge the evidence led against them. It is contrary to the judicial process and no part of judicial power to effect a determination of rights by applying the law to facts which are neither agreed nor determined by reference to the evidence in the case. However, that is what happened in this case. To revoke special leave to appeal would be to sanction departure from the judicial process - a course that should not be taken even if the appellants acquiesced in the formulation of questions 2 and 3 and in the procedures which led to the answers given and the consequential orders made by the Full Court.
[30] Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334 [56] (Gleeson, CJ, Gaudron, McHugh, Gummow, Hayne & Callinan JJ).
Their Honours in Bass relevantly observed that a demurrer (wherein the facts pleaded are not disputed) proceeds upon identified facts and enables the court to declare whether or not they provide a cause of action or a defence or reply to another party's pleading.[31] However, the utility of a demurrer is heavily dependent upon the pleadings containing all relevant facts and a demurrer assumes the pleadings exhaust the universe of relevant factual material.[32]
[31] Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334 [50] (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne & Callinan JJ).
[32] Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334 [50] (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne & Callinan JJ).
Their Honours in Bass also observed that whilst the formulation of specific questions to be tried separately from and in advance of other issues will assist in the more efficient resolution of matters in issue, that will only be so if the questions are capable of final answer and are capable of being answered in accordance with the judicial process.[33]
[33] Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334 [51] (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne & Callinan JJ).
On this ground alone, it is clear that this court should not embark upon a determination of the three questions posed by the first defendant, as to do so relies upon incomplete facts and assumptions that cannot properly be assumed. The factual matters relied upon by the first defendant can only be determined after a hearing of the evidence. In these circumstances, it is impossible to answer the questions other than in a hypothetical way. Consequently, the application should be dismissed.

The issues raised in the questions

I am also of the opinion that the application should be dismissed on grounds that the issues the first defendant seeks to raise in question 1 are confusing and:
(a)raise issues which do not appear to be supported by established authority;
(b)raise issues that are not raised in the question as drafted;
(c)rely upon facts which are not referred to in the first defendant's 'Agreed Facts'; and
(d)raise an issue that is not pleaded by the defendants, that is, it cannot be said to be necessarily an issue that arises on the pleadings.
I am also of the view that there is little utility in dealing with questions 2 and 3 by means of a special case.
The first defendant argues that question 1 raises a number of issues and sub‑questions.
As a preliminary question to question 1, the first defendant says the issue is whether the original pipes that connected eight bathroom fixtures are one and the same as the 2009 pipes that connect five bathroom fixtures in different locations in Unit 2. I am not entirely certain why this issue is raised as it is not the plaintiff's pleaded case that the 2009 pipes are the one and the same as the original pipes.
Leaving this 'preliminary' question aside, the first sub‑question or issue the first defendant says arises in question 1 is an argument whether s 6 of the 1966 Act and s 11 of the 1985 Act imply corresponding easements for utility, that is, a dominant and subservient tenement.
The first defendant outlined this argument as follows:[34]
(a)all of the land below Unit 1 and Unit 2 is common property;
(b)when land comprising Unit 1 and Unit 2 were subdivided under the 1966 Act, the pipes were in situ in the land and thus they were 'grandfathered' as pipes in the 'common property' and protected as an implied easement pursuant to s 6 of the 1966 Act.
[34] ts 18 - 19, 27 February 2019.
The first defendant wishes to argue this to be the case (by regard to the assumed facts) to put an argument that the effect of the installation of the original pipes (prior to Unit 1 and Unit 2 being created by subdivision in 1977) was that the dominant tenement over which the easement subsisted was in common property (and not in Unit 2).
This point, however, is contrary to the first defendant's pleaded in case in [6B(b)] of the defendants' amended defence that the original pipes were the subject of a utility easement implied by s 6(a)(ii) of the 1966 Act for the benefit of lot 2, as against lot 1. This pleading is capable of being understood as a clear admission that the dominant tenement subsisted in Unit 2 as an easement that benefitted the dominant lot (being lot 2 otherwise described as Unit 2) and that the easement accommodated Unit 2.
The first defendant argues that the second sub‑question or sub‑issue raised in question 1 is whether the ancillary rights that attached to the utility easement implied under the 1966 Act authorised the installation of the 2009 pipes. The first defendant wishes to put an argument in respect of this issue that the implied ancillary rights extended only to 'repair or replacement' of the original pipes but did not extend to the scope of the work undertaken in the bathroom renovations by the plaintiff in 2009 and 2010.
There are two difficulties in attempting to determine this issue as a preliminary question of law. The first is that determination of this issue raises a mixed question of fact and law, the facts in relation to which are disputed and are not capable of being resolved as a preliminary question by means of a special case. As the first defendant points out in her written submissions, the question whether the 2009 pipes were replacement pipes for the original pipes is a critical issue for determination of this action.[35]
[35] Application by defendants pursuant to Order 31 r 2 (submissions), filed 26 October 2018 [5.9].
Secondly, the authorities on which the first defendant relies in support of her argument are not decisions about the nature and scope of easements, and do not refer to, or consider the nature, scope, extent of ancillary rights that arise from easements implied under legislation or ancillary rights arising from prescription by the doctrine of lost modern grant.[36]
[36] Owners of Strata Plan 502756 v Thoo [2013] NSWCA 270 and Maludra Pty Ltd v The Owners of Windsor Towers Strata Plan 80 [2017] WASAT 112.
In question 2, the first defendant claims there are two issues raised. The first issue is said by the first defendant to raise a 'fundamental and firm' legal principle that an easement arising from prescription by the doctrine of lost modern grant cannot be claimed by the plaintiff, if the plaintiff is entitled to an implied easement arising from statute, namely s 6 of the 1966 Act.
This contention may or may not be correct at law, but the issue is not likely to be determinative, as the plaintiff's claim of an easement by the doctrine of lost modern grant is pleaded in the alternative.
The second issue the first defendant contends is raised in question 2 is that given it is well established an easement will not arise unless the enjoyment by the alleged dominant owner is of 'right' (that is the exercise of the use must not be permissive) it is not open to the plaintiff to claim an easement by prescription by lost modern grant as the plaintiff pleads the consent of the first defendant's predecessor entitled it to renovate the bathrooms and to install the 2009 pipes.
The plaintiff says the answer to this question will, however, turn on a question of fact as it pleads consent or acquiescence in the context of replacing the original pipes with the 2009 pipes and the issue of consent is relevant to a determination of whether the replacement of the original pipes was authorised by ancillary rights. Thus, it is argued by the plaintiff that in determining what rights are ancillary, regard can be had to whether the owner of the subservient tenement consents or permits a particular configuration to be accepted in lieu of a previous configuration.
Leaving aside whether such evidence should be accepted, it is patently clear that this is an issue that cannot be properly determined separately from the evidence on all of the issues raised in the pleadings.
The first defendant contends the issue raised in question 3 is that if as pleaded by the plaintiff the pipes and their structural supports do not constitute common property and are not structural cubic space, it necessarily must follow that the plaintiff's pipes are owned by the defendants.
As the plaintiff points out:[37]
(a)the location of the pipes is a factual issue and if the plaintiff's pleaded case is accepted (on the facts pleaded by the plaintiff) it is open to find that the plaintiff has an easement as the owner of Unit 2 over the original and 2009 pipes;
(b)such finding is capable of negativing any claim of ownership of the pipes by the defendants; and
(c)alternatively, if a finding is made that the defendants did own the pipes, if the plaintiff's asserted easement is made out the defendants' rights as owner of the subservient tenement would necessarily be subject to the plaintiff's easement, as it is the dominant tenement.
[37] ts 40 - 41, 27 February 2019.

Conclusion

The first defendant's application is dismissed. I will hear the parties as to the orders that should be made, including orders as to costs.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

EH
Research Associate/Orderly to the Honourable Justice Smith

16 APRIL 2019

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: POLARIS PROPERTIES (WA) PTY LTD as trustee for THE POLARIS TRUST -v- PICKWORTH [2019] WASC 119 (S)
CORAM:   SMITH J
HEARD:   ON THE PAPERS BY WRITTEN SUBMISSIONS FILED 16 APRIL & 28 APRIL 2019
DELIVERED          :   16 MAY 2019
FILE NO/S:   CIV 1996 of 2017
BETWEEN:   POLARIS PROPERTIES (WA) PTY LTD as trustee for THE POLARIS TRUST
Plaintiff
AND
JENNIFER JANE PICKWORTH
First Defendant
JAMES DAVID BOWMAN
Second Defendant

Catchwords:

Costs - Application for indemnity costs - Case for preliminary determination of questions of law in a stated case hopeless - Legally qualified self-represented litigant - Turns on own facts

Legislation:

Rules of the Supreme Court 1971 (WA), O 1 r 4A and 4B, O 31 r 2

Result:

Plaintiff's application for indemnity costs granted

Representation:

Counsel:

Plaintiff	:	Mr M D Cuerden SC
First Defendant	:	In person
Second Defendant	:	Not applicable

Solicitors:

Plaintiff	:	Hager Grubb & Partners Lawyers
First Defendant	:	In person
Second Defendant	:	Not applicable

Case(s) referred to in decision(s):

Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334
Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Ltd [1988] FCA 202; (1988) 81 ALR 397
Kidd v The State of Western Australia [2015] WASCA 62 (S)
Polaris Properties (WA) Pty Ltd as trustee for The Polaris Trust v Pickworth [2019] WASC 119
Yara Australia Pty Ltd v Oswal [2012] WASCA 264

SMITH J:

Introduction

On 16 April 2019, I published my reasons for concluding that the first defendant's application to determine preliminary questions of law in a stated case should be dismissed.[38]
[38] Polaris Properties (WA) Pty Ltd as trustee for The Polaris Trust v Pickworth [2019] WASC 119.
At the time my reasons were published, the plaintiff had filed very short submissions in support of its application for costs, a short affidavit in support of its application and a minute of proposed orders seeking an order that the first defendant pay the plaintiff's costs of the application forthwith, on either an indemnity or, alternatively, on a party/party basis.
On 16 April 2019, orders were made to dismiss the first defendant's application for a stated case; requiring the first defendant to file submissions as to costs of the application within seven days; and ordering that the question of costs be determined on the papers.
The first defendant filed lengthy submissions as to a costs order on 26 April 2019 together with an affidavit sworn by her on 15 April 2019. On 28 April 2019, the first defendant filed a supplementary affidavit which had been sworn by her on that day.
The first defendant opposes the orders as to costs sought by the plaintiff and seeks an order that costs be in the cause.
In her submissions, the first defendant professed not to be argumentative, but went on to do exactly that. In lengthy submissions, the first defendant attempts to substantially reargue the merits of the case that she put forward at the hearing of the application for a determination of preliminary questions of law, which were rejected in my published reasons. Such an approach is not appropriate and is contrary to the principle of finality in litigation.
The filing of extensive submissions is also contrary to the principle that the court should discourage protracted and lengthy disputes as to costs and is the type satellite litigation that the court regards as contrary to the overarching principles specified in O 1 r 4A and 4 B of the Rules of the Supreme Court 1971 (WA).[39]
[39] Kidd v The State of Western Australia [2015] WASCA 62 (S) [1] ‑ [2] (Martin CJ, Newnes & Murphy JJA).
Consequently, these reasons will not deal with the issues the first defendant seeks to re‑litigate in her written submissions filed on 26 April 2019.

Legal principles - indemnity costs.

In Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Ltd, Woodward J observed that an award of indemnity costs is appropriate where the action 'has been commenced or continued in circumstances where the applicant, properly advised, should have known that he had no chance of success'.[40]
[40] Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Ltd [1988] FCA 202; (1988) 81 ALR 397, 401; applied in Yara Australia Pty Ltd v Oswal [2012] WASCA 264 [33] (Murphy JA).
In Civil Properties Pty Ltd v Miluc Pty Ltd, Newnes JA set out the principles for assessing whether an award of indemnity costs should be made on grounds that a party brought a hopeless case. His Honour said:[41]
It is well-established that a court has a wide discretion as to costs (albeit, a discretion to be exercised judicially) and that an appellate court will be slow to interfere with the exercise of that discretion. Whether or not an order for indemnity costs is appropriate must depend upon the facts of the particular case. There are not, and cannot be, any hard and fast rules. But an indemnity costs order is a departure from the usual order that costs are awarded on a party and party basis. Ordinarily an indemnity costs order is appropriate only where the unsuccessful party has been involved in some unreasonable conduct in relation to the proceedings, such as where the institution or continuation of the proceeding was plainly unreasonable or the proceeding was issued or maintained for an ulterior or collateral purpose: see Rosniak v Government Insurance Office (1997) 41 NSWLR 608, 616; PCRZ Investments Pty Ltd v National Golf Holdings Ltd [2002] VSCA 24 [36]. An order for indemnity costs reflects the court's disapproval of the conduct of the unsuccessful party: Flotilla Nominees Pty Ltd v Western Australian Land Authority [2003] WASC 122 (S); (2003) 28 WAR 95 [25].
If a party brings a case which is hopeless it can normally be inferred that the proceeding was commenced or continued 'for some ulterior motive or because of some wilful disregard of the known facts or the clearly established law': Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397, 401. But it is not necessary that such an inference be drawn; it is sufficient that the court's resources and the successful party's costs have been wasted on entirely frivolous litigation: Re SCA Properties Pty Ltd (in liq) [1999] QSC 180; (1999) 17 ACLC 1611 [70].
[41] Civil Properties Pty Ltd v Miluc Pty Ltd [2011] WASCA 195 [82] ‑ [83].
In Woodley v Woodley, Allanson J applied these principles to an application for indemnity costs against a self‑represented litigant. In this context, Allanson J added to the principles considered by Newnes JA by making the following observations:[42]
I interpose that, with a litigant in person, the inference that a hopeless case was commenced for an ulterior motive may not always be the case. The facts leading to that inference may be countered by the lack of legal knowledge and training and, importantly, objectivity of a litigant in person. Returning to what Justice Newnes said:
'However, while indemnity costs may be awarded where an action has been commenced or continued in circumstances where the plaintiff, properly advised, should have known that the action had no prospect of success, a court must not be too ready to find that a case was hopeless.'
His Honour then quoted the passage from Quancorp Pty Ltd v MacDonald. Mr Woodley referred to it in his submissions. In particular, it is inappropriate that a case be too readily characterised as hopeless so as to justify an award of indemnity costs. And Newnes J concluded:
'It must also be borne in mind that what is apparent at the end of a trial may not have been so obvious beforehand. Whether or not a case was hopeless is not to be determined with the benefit of hindsight.'
Turning then to my findings in the present matter, they are these. The plaintiff represented himself, and it is necessary to make some allowances. In part, a litigant in person cannot bring the objectivity to bear of an impartial legal practitioner. It is not just a matter of expertise or legal knowledge, but it is a matter of being too close to the subject matter of the proceedings and lacking the necessary objectivity to make sound judgments.
[42] Woodley v Woodley [No 7] [2018] WASC 381 [5] ‑ [7].
Although the first defendant is on the roll of legal practitioners, having practised law for 35 years and is now retired, the observations of Allanson J in Woodley are apposite.
Whilst the first defendant is qualified to practise law (and did so for a considerable length of time) it is clear from her submissions, that she (like all, if not most, litigants in person) cannot bring to the proceedings the objectivity of an impartial legal practitioner.

Was the application for a stated case hopeless?

The answer to this question is yes.
For the court to determine a preliminary question of law, pursuant to O 31 r 2 of the Rules of the Supreme Court 1971 (WA), there must be a properly stated case before the court, that is, the relevant facts must be identified with precision.[43]
[43] Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334 [49] - [54] (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne & Callinan JJ).
It was on this fundamental point that I determined that the first defendant's application for a stated case should be dismissed.
In support of her application, the first defendant was unable to put before the court all the relevant facts, about which it could properly have been said that there was no disagreement, in respect of which any preliminary questions of law could be answered by the court.
The first defendant sought to argue that the facts relevant to the preliminary questions of law were 'facts' that could be said to be agreed between the parties, and that they were facts pleaded in part of the parties pleaded cases.
It is not open to the court, in determining a stated case, to draw inferences of fact from what is stated in the case. Yet, this was precisely what the first defendant sought to do by providing to the court and to the plaintiff a document which the first defendant described as a 'comparator document' that highlighted extracted parts of the parties' pleadings.
The 'comparator document' was provided by email to the court and the plaintiff's solicitors by the first defendant on 11 February 2019. The document is a copy of the defendant's re‑amended defence and counterclaim, filed on 15 January 2019, and contains additional extracts of parts of paragraphs pleaded by the plaintiff in the plaintiff's amended reply and defence to counterclaim, dated 6 July 2018.
The first defendant highlighted parts of the extracts in blue as 'facts', which were said to be agreed and constitute all relevant admissions in the pleadings. These facts were said to be sufficient to determine the preliminary questions of law that were sought to be answered by the first defendant.
In her written submissions, filed on 28 April 2019, the first defendant claims the 'comparator document' was prepared with meticulous precision.[44] However, this document was not at all helpful to the court in determining the application for a stated case.
[44] First defendant's submission in support of application against indemnity costs and for costs to be in the cause, filed 26 April 2019 [3.12].
The 'comparator document' contained no extracts or notations of relevant matters pleaded by the plaintiff in the plaintiff's further re‑amended substituted statement of claim, filed on 13 December 2018. This error was plainly material.
In particular, it emerged that when all the pleadings were read together there was a material factual disagreement as to the location, configuration, function, dimensions and extent of the original water, sewerage and drainage pipes, the original plumbing systems, the 2009 pipes and the 2009 plumbing system.
I also found that the first defendant sought to rely upon facts which were said by the first defendant to be 'agreed', which was a conclusion that could not be drawn from the pleadings.[45]
[45] Polaris Properties (WA) Pty Ltd as trustee for The Polaris Trust v Pickworth [2019] WASC 119 [38] ‑ [45].
The first defendant, in her written submissions, states that she prepared the 'comparator document' as she was of the view that any other document would be objected to by the plaintiff.[46] She was critical of the plaintiff's solicitors for not agreeing to a summary of 'Agreed Facts' that the first defendant had provided to the court in her written submissions in support of her application for a stated case.[47]
[46] First defendant's submission in support of application against indemnity costs and for costs to be in the cause, filed 26 April 2019 [3.13].
[47] First defendant's submission in support of application against indemnity costs and for costs to be in the cause, filed 26 April 2019 [3.13].
The summary of 'Agreed Facts' provided by the first defendant in her written submissions in support of her application for a case stated was also deficient and some of the facts referred to by the first defendant in her 'Agreed Facts' were incomplete.
The first defendant is wrong to be critical of the plaintiff for not reaching agreement as to the material facts. The facts pleaded by each of the parties materially diverge on almost all relevant factual issues going to the plaintiff's claimed easement and ancillary rights.
Plainly, the issues going to the claimed easement and ancillary rights sought to be raised by the plaintiff and the first defendant in their pleaded cases will turn upon the facts as found in a contested hearing on the merits of the facts and law.
Whilst I was of the view that the first defendant's application should be dismissed on grounds that all relevant facts could not be identified with precision, I was also of the opinion that the application for a stated case should be dismissed on grounds that the issues that the first defendant sought to raise in question 1 were confusing and:[48]
(a)raised issues which did not appear to be supported by established authority;
(b)raised issues that were not raised in the question as drafted;
(c)relied upon facts which were not referred to in the first defendant's 'Agreed Facts'; and
(d)raised an issue that was not pleaded by the defendants, that is, it could not be said to be necessarily an issue that arose on the pleadings.
[48] Polaris Properties (WA) Pty Ltd as trustee for The Polaris Trust v Pickworth [2019] WASC 119 [49].
I was also of the view that there was little utility in dealing with questions 2 and 3 by means of a special case.[49]
[49] Polaris Properties (WA) Pty Ltd as trustee for The Polaris Trust v Pickworth [2019] WASC 119 [50].
The first defendant, properly advised, should have known that her application for a stated case to determine preliminary questions of law was hopeless and bound to fail.
For those reasons, I will uphold the plaintiff's application for indemnity costs and make the standard order for indemnity costs, namely, that the first defendant should pay all the costs incurred by the plaintiff, except insofar as they are of an unreasonable amount or have been unreasonably incurred so that subject to those exceptions, the plaintiff is completely indemnified for its costs of the stated case application.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

EH
Research Associate/Orderly to the Honourable Justice Smith

16 MAY 2019