Sheppard v Smith

[2022] NSWCA 167

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation:

Sheppard v Smith [2022] NSWCA 167

Hearing dates:

8 June 2022

Date of orders:

29 August 2022

Decision date:

29 August 2022

Before:

Gleeson JA at [1];
Beech-Jones JA at [2];
Basten AJA at [103]

Decision:

(1)   Appeal dismissed.

(2)   The Appellants pay the Respondents’ costs of the Appeal.

Catchwords:

EASEMENTS – application to extinguish right of way – s 89(1) Conveyancing Act – adjacent properties – obsolescence – right of way granted in 1885 in unlimited terms – purposes included, but not limited to, removal of “nightsoil”– right of way fell into disuse after sewers connected in 1908 – no error in primary judge’s finding that easement should not be deemed obsolete

EASEMENTS – abandonment – title to dominant tenement became indefeasible in 2010 – owners took ‘active steps’ to include right of way on title – servient tenement not part of appellants’ property until possessory title approved in 2019 – title granted subject to right of way fence erected between properties preventing access – garden bed and fishpond built on servient tenement – after grant of indefeasible title dominant tenement owners built new fence, shed and wall impeding access to right of way – owners of servient tenement replaced garden bed and fishpond with wall – extended room over right of way – whether intention to abandon easement should be inferred – non‑user and building of non-permanent obstacles thereafter did not establish abandonment

EASEMENTS – substantial injury – continued existence of easement would secure practical benefit to owners of dominant tenement – no error in primary judge’s finding that it was not shown that extinguishment would not substantially injure the owners of the dominant tenement – appeal dismissed

Legislation Cited:

Conveyancing Act 1919 (NSW), s 89

Real Property Act 1900 (NSW), ss 28U and 28V

Cases Cited:

Ashoil Holdings Pty Ltd v Fassoulas (2005) 12 BPR 98195; [2005] NSWCA 80

Chiu v Healey [2003] NSWSC 857

Durian (Holdings) Pty Ltd v Cavacourt Pty Ltd (2000) 10 BPR 18,099; [2000] NSWCA 28

Gotobed v Pridmore (Court of Appeal (UK), 16 December 1970, unrep)

Pieper v Edwards [1982] 1 NSWLR 336

Proprietors Strata Plan 9,968 v Proprietors Strata Plan 11,173 [1979] 2 NSWLR 605

Re Mason and the Conveyancing Act [1962] NSWR 762; (1960) 78 WN (NSW) 925

Sheppard v Smith [2021] NSWSC 1207

Swan v Sinclair [1924] 1 Ch 254

Swan v Sinclair [1925] AC 227

Treweeke v 36 Wolseley Road Pty Ltd (1973) 128 CLR 274; [1973] HCA 27

Williams v Usherwood (1983) 45 P & CR 235

Category:

Principal judgment

Parties:

Dean Frederick Sheppard (First Appellant)
Meredith Jane Chapman (Second Appellant)
Dean Clayton Smith (First Respondent)
Emma Jane Munro (Second Respondent)

Representation:

Counsel:
Mr GA Sirtes SC; Mr G Marsden (Appellants)
Mr JM Ireland QC (Respondents)

Solicitors:
Colquhoun v Colquhoun (Appellants)
DC Balog & Associates (Respondents)

File Number(s):

2021/296713

 Decision under appeal 

Court or tribunal:

Supreme Court

Jurisdiction:

Equity

Citation:

Sheppard v Smith [2021] NSWSC 1207

Date of Decision:

23 September 2021

Before:

Parker J

File Number(s):

2019/306802

HEADNOTE

[This headnote is not to be read as part of the judgment]

The Appellants and the Respondents are the owners of adjacent properties in inner Sydney (being “Number 6” and “Number 8” respectively). Number 8 has the benefit of a right of way over an L-shaped strip of land at the rear and side of Number 6 which if trafficable would provide access from the rear of Number 8 to the street (the “L- shaped strip”).

The right of way was granted in 1885 when a much larger area of land was subdivided. It was expressed in unqualified terms, although its purposes at least included the facilitation of the removal of “night soil” (ie, a “dunny lane”). The L-shaped strip did not originally form part of Number 6. Number 8 was brought under the Real Property Act 1900 prior to its acquisition by the Respondents in 2008, however, indefeasible title to the property was not granted until 2010. The primary judge found that, at that time, the Respondents took “active steps” to record the right of way on the title to Number 8.

The Appellants acquired Number 6 in 2012. Number 6 was brought under the Real Property Act around 1995 but the L-shaped strip was not part of the title until a possessory title application was granted in 2019. The new title recorded the existence of the right of way over the land in favour of Number 8.

After the connection of sewers in around 1908, traffic along the right of way ceased and it fell into disuse. Fences between Number 6 and Number 8 were extended to the rear fences across the entrance to the right of way. On Number 6 a gate was constructed at the point where the L-shaped strip met the street. A garden bed was built at the rear of Number 6 in the area of the right of way, save for a manhole cover in the corner. A fishpond was built at one end of the garden bed.

After 2010 the Respondents replaced the fence between Number 6 and Number 8 with a wooden paling fence built entirely on Number 8’s property. They placed a metal post in the area of the right of way. They constructed a knee-high concrete wall against the rear fence to Number 8 which impeded access to the right of way, and built a garden shed in their backyard close to the new fence. They later removed the shed.

After the Appellants acquired Number 6, they replaced the garden bed and fishpond with a waist-high brick wall along the boundary with number 4. They also extended a room across the right of way to the boundary with number 4.

In 2019 the Appellants commenced proceedings against the Respondents seeking an order under s 89(1) of the Conveyancing Act 1919 that the right of way be extinguished. The Appellants relied on all three limbs of s 89(1) as the basis for extinguishment, namely that: (i) by the “acts or omissions” of the persons from time to time entitled to the easement it “may reasonably be considered [that they] have abandoned the easement” (s 89(1)(b)); (ii) that the easement “ought to be deemed obsolete” or that the continued existence of the easement “would impede the reasonable user of the land subject to the easement … without securing practical benefit to the persons entitled to the easement” (s 89(1)(a)); and (iii) that the proposed extinguishment of the easement “will not substantially injure the persons entitled to the easement” (s 89(1)(c). The Appellants also relied on s 89(1A) which provides that, for the purposes of s 89(1)(b), an easement may be treated as abandoned if the Court is satisfied that the easement has not been used for at least 20 years before the application under subs (1) for extinguishment (or modification) is made.

The primary judge (Parker J) dismissed the proceedings. The decision was appealed.

The principal issues arising on the appeal were whether the primary judge erred:

1. in finding that the Respondents manifested an intention not to abandon the right of way in December 2010 when the right of way was noted on the certificate of title to Number 8;

2. in failing to find an intention on the part of the Respondents to abandon the right of way;

3. in failing to find an intention of the part of the prior owners of Number 8 to abandon the right of way;

4. in finding that the right of way was not obsolete; and

5. in failing to find that the extinguishment of the easement would not substantially injure the Respondents.

The Court held, by Beech-Jones JA (Gleeson JA and Basten AJA agreeing) dismissing the appeal:

In relation to issue (i):

1. The primary judge did not err in finding that the Respondents manifested an intention not to abandon the right of way in December 2010 by having the right of way noted on the certificate of title to Number 8. Taking steps to record the existence of a right of way onto a certificate of title which is then available to anyone who searches the register is a public form of affirmation of the existence of the right of way: at [56].

   Treweeke v 36 Wolseley Road Pty Ltd (1973) 128 CLR 274; [1973] HCA 27 (“Treweeke”) applied;

In relation to issue (ii):

1. The primary judge did not err in failing to find an intention on the part of the Respondents to abandon the right of way by their actions from the time they acquired the property. The primary judge considered their failure to use the right of way and the features they built on Number 8 that impeded access to the right of way. However, those features were not permanent and those steps had to be considered in a context where they had already taken active steps to record the right of way on the title to their property: at [66], [71].

   Treweeke applied; Ashoil Holdings Pty Ltd v Fassoulas (2005) 12 BPR 98195; [2005] NSWCA 80; Swan v Sinclair [1925] AC 227; Swan v Sinclair [1924] 1 Ch 254; Chiu v Healey [2003] NSWSC 857 considered;

In relation to issue (iii):

1. The primary judge assumed, without deciding, that s 89(1)(b) of the Conveyancing Act empowers the Court to extinguish an easement by reason of the conduct of previous owners of the dominant tenement notwithstanding the indefeasibility of the current owners’ title. The issue was not agitated on appeal: at [36].

   Pieper v Edwards [1982] 1 NSWLR 336 noted;

   4.   The primary judge did not err in failing to find an intention on the part of the prior owners of Number 8 to abandon the right of way. While non-user of the right of way was relevant it was not sufficient to manifest an intention to abandon the right of way. There was no evidence of either any assertion by the previous owners of rights over the easement or encouragement or acquiescence in the construction of obstacles over the right of way. An absence of evidence of an assertion of an entitlement to a right of way and objection to obstacles being built on the right of way, when coupled with an absence of evidence of knowledge of the right of way, does not translate to a finding of acquiescence: at [76]-[78].

   Treweeke applied;

In relation to issue (iv):

1. The primary judge did not err in finding that the right of way was not obsolete. There was nothing in the terms of the grant of the right of way or anything else that warranted any finding that the purpose of the right of way was restricted. There had been no relevant change in the “character of the neighbourhood”. The genuine intention of the owner of the dominant tenement to use the right of way is not irrelevant to an assessment of whether the right of way ought to be deemed obsolete, at least when accompanied by a realistic means to make the right of way trafficable. As the purpose of the right of way was not limited to the removal of “night soil” the continued existence of the right of way secured a practical benefit to the owners of Number 8: at [92], [94].

   Durian (Holdings) Pty Ltd v Cavacourt Pty Ltd (2000) 10 BPR 18,099; [2000] NSWCA 28; Re Masonand the Conveyancing Act [1962] NSWR 762 at 764; (1960) 78 WN (NSW) 925 (“Re Mason”) applied;

In relation to issue (v):

1. The primary judge did not err in requiring the Appellants to prove that the probability of the use of the easement by the owners of Number 8 was “so remote” and the financial value to them of the easement was “so small” as to be of no present substance. That approach was not utilised as a general test. Instead, in the context of a right of way that was not trafficable and had not been used for some time, that approach simply conveyed the necessity to undertake an evaluative exercise as to whether the extinguishment of the easement would not substantially injure the owners of Number 8: at [100].

   Re Mason applied.

JUDGMENT

1. GLEESON JA: I agree with Beech-Jones JA.

2. BEECH-JONES JA: This is an appeal from a judgment of Parker J dismissing an application for an order under s 89(1) of the Conveyancing Act 1919 (NSW) (the “CA”) for the extinguishment of an easement.

3. The Appellants, Dean Frederick Sheppard and Meredith Jane Chapman, are the registered proprietors of one of two adjoining properties in inner Sydney (“Number 6”). The Respondents, Dean Clayton Smith and Emma Jane Munro, are the registered proprietors of the other property (“Number 8”). Number 8 has the benefit of a right of way over a strip of land at the rear and side of the land that now forms part of Number 6 (the “L-shaped strip”) as follows:

4. The origins and nature of the various items and objects depicted in this diagram are described below.

5. After disputation arose in relation to attempts by the Respondents to use the easement, the Appellants commenced proceedings in this Court seeking an order for its extinguishment under s 89(1) of the CA. The relevant terms of s 89 are set out below but at this point it suffices to note that the Appellants relied on all three limbs of s 89(1) that give rise to the power to make such an order, namely, that: the easement is obsolete or unreasonably impedes their use of their land (s 89(1)(a)); that the easement was abandoned (s 89(1)(b)); or that its extinguishment will not substantially injure the Respondents (s 89(1)(c)).

6. After a three-day hearing, Parker J published a comprehensive judgment dismissing the application: Sheppard v Smith [2021] NSWSC 1207 (“Sheppard”). His Honour noted that a cross-claim filed by Mr Smith and Ms Munro seeking to have various obstructions constructed over the easement removed was discontinued, although there was “no real dispute” that, if Mr Sheppard and Ms Chapman’s application failed, the obstructions would have to be removed. [1]

   1. Sheppard at [11].

7. A number of grounds of appeal were pressed on behalf of the Appellants but in essence they contended that, in rejecting their case on abandonment, his Honour placed too much emphasis on the actions of the Respondents in having the right of way noted on the title in 2010 and attached too little weight to their conduct in taking various steps afterwards that hindered access to the right of way. For the reasons that follow, I consider that the primary judge did not so err and was otherwise correct in rejecting each of the bases for extinguishment put forward by the Appellants.

Title to Number 6, Number 8 and the L-Shaped Strip

8. Number 6 and Number 8 originally formed part of an adjoining group of six terraces built in the late nineteenth century. [2] Number 6 and Number 8 were built on Lot 3 and numbers 10, 12, 14 and 16 were built on Lots 1 and 2. In January 1883, the owner of the lots, Thomas O’Toole, sold Lot 3 to Bridget Tubridy but retained Lots 1 and 2. Ms Tubridy constructed a pair of terrace houses on Number 6 and Number 8 with a common “party wall”. Behind each terrace was a (small) backyard. ^[3]

   2. Sheppard at [16].

   3. Sheppard at [18].

9. The six terraces were (originally) surrounded on three sides by a lane way that was 1.045m wide. The laneway ran from the street along the southern edge of Number 6, then along the western edges of numbers 6 to 16 and then back along the northern edge of number 16. The primary judge noted that it was agreed that the “original purpose of the laneway would have been, or at least would have included, the removal from the outhouses of what is quaintly and euphemistically called ‘nightsoil’”. The lane was “[c]olloquially, … known as a ‘dunny lane’.”[4]

   4. Sheppard at [22].

10. Ms Tubridy subdivided Lot 3 and sold the two lots in October 1885. Of some significance to the appeal is that the “L-shaped strip did not form part of Number 6 but was instead retained by Ms Tubridy. The conveyance reserved a right of way over that land in favour of Number 8,[5] expressed as “a right of way over a passage along the western and southern boundaries of the remaining part of Lot three”.

    5. Sheppard at [27].

11. Title to the two lots passed between different owners during the twentieth century. Ownership of Number 6 passed to Patrick McMahon in July 1956. He sold Number 6 to Mathew and Rowena Morgan in July 2006. [6] The Appellants completed the purchase of Number 6 from them in January 2012. [7] Number 8 was purchased by Jean McJannet in November 1956. She sold it to the Respondents in 2008.

    6. Sheppard at [40].

    7. Sheppard at [47].

12. As noted by the primary judge, both properties were still under old system title when acquired by Mr McMahon and Ms McJannet. [8] In 1995, Number 6 was brought under the Real Property Act 1900 (NSW) (“RPA”) with the lodgement of a Deposited Plan. However, the title created was limited; that is, the boundaries would not become indefeasible until a plan of delimitation was lodged (RPA, ss 28U and 28V). Similarly, at some point prior to 2008, Ms McJannet brought Number 8 under the RPA. When she sold it in 2008, the title was also limited. [9] At that time, the right of way over the L-shaped strip was not noted in the title. [10] However, after they purchased Number 8, in June 2010, the Respondents lodged a delimitation plan which was subsequently registered with the limitation on title cancelled (RPA, s 28V(1)). It is of significance to this appeal, as explained below, that they took steps to ensure that the right of way was recorded on the title. [11]

    8. Sheppard at [37].

    9. Sheppard at [38].

    10. Sheppard at [39].

    11. Sheppard at [46].

13. Thus, by 2012 both Number 6 and Number 8 were brought under the RPA in unqualified terms and Number 8 had a right of way noted on title over the L-shaped strip. However, despite the use that had been made of that land by the various proprietors of Number 6 explained below, the L-shaped strip was not part of Number 6. Ownership of the L-shaped block was retained by Ms Tubridy and presumably had passed to her successors.

14. In August 2017, the Appellants lodged an application for possessory title over the L-shaped strip. This required that it be brought under the RPA and incorporated into the title for Number 6. [12] A new development plan incorporating the L-shaped strip which noted the right of way was registered in late March 2019. [13] The primary judge queried whether the notation of the easement on Number 8’s RPA title in December 2010, when Number 6 was still old system land, gave rise to an indefeasible interest. However, his Honour found that any doubt about that dissipated upon the registration of the L-shaped strip under the RPA in March 2019 along with the easement, at which time “[N]umber 8’s interest clearly became indefeasible”. [14] There was no challenge to that conclusion.

    12. Sheppard at [59].

    13. Sheppard at [62].

    14. Sheppard at [153].

15. The fact that the L-shaped strip did not become part of Number 6 until 2019 is of significance in considering the events that are said to give rise to an abandonment. Until that time the owners of Number 6 were not the owners of the servient tenement.

Dealings with and Use of the L-Shaped Strip

16. As noted, there is no doubt that at least one of the purposes of the right of way in respect of the L-shaped strip was to facilitate the collection of “nightsoil”. The primary judge found that sewer lines servicing the terraces were built in 1908 and in the “decades” afterwards “traffic along the laneway ceased and much of it fell into disuse”. [15] The fences between Number 6 and Number 8 and between Number 8 and number 10 were extended to the rear fence. [16] The portion of the laneway behind Number 8 was not subject to any rights of way and was incorporated into its back yard. [17]

    15. Sheppard at [30].

    16. Sheppard at [30].

    17. Sheppard at [31].

17. With Number 6, a gate was constructed at the entrance to the laneway and the back of the laneway was subsumed into its rear garden. Along the southern wall a raised garden bed was built which, according to the primary judge, “extended for most, if not all, of the width of the former laneway” which was 65cm to 75cm above the ground level. [18] A small garden bed was constructed at the rear in the area of the former laneway. In the middle it was 50cm wide, but it extended further at both ends such that, at the southwestern end, it covered the full width of the laneway. It did not extend to the fence with number 4 as there was a sewer manhole in that corner. [19]

    18. Sheppard at [33].

    19. Sheppard at [34].

16. The primary judge accepted the evidence of a witness who lived in the street from when he was born in 1952 until 2006 that there was a fence between Number 6 and Number 8. [20] His Honour found that “[i]t seems likely that by [2006] there had, for decades, been no regular access to the rear of [N]umber 8 from the former laneway”. [21] The primary judge found that at the time the Respondents purchased Number 8 in 2008 the fence between them was “not only dilapidated but was heavily overgrown with ivy”. [22]

    20. Sheppard at [75]-[77].

    21. Sheppard at [77].

    22. Sheppard at [79].

17. As to Number 6, at sometime between 2006 and 2012, Mr and Mrs Morgan constructed a fishpond at the eastern end of the raised garden bed and replaced the pergola at the rear with a larger version. They extended that roof on a single-storey extension across the laneway to the boundary with number 4. [23]

    23. Sheppard at [41].

18. In 2013, the Respondents undertook renovations at Number 8. By this time, title to Number 8 had been brought under the RPA and included the right of way as a notation.

19. The Appellants had no title to the L-shaped strip which was still under the old system title although they clearly occupied it. The Respondents replaced the fence between Number 6 and Number 8 with a new wooden paling fence built entirely on Number 8. On the Number 6 side of the fence, but still on Number 8’s property, they placed a metal fence post in the former laneway. They also constructed a knee-high concrete wall against the rear fence to Number 8 that extended to the boundary with Number 6 (the “knee wall”). [24]

    24. Sheppard at [49].

20. In November 2015, the Respondents built a garden shed in their backyard “close” to the new fence built by the appellants. [25] His Honour noted that “[a]ccording to Mr Smith, the clearance on the southern side was about 60 cm.”[26]

    25. Sheppard at [56].

    26. Sheppard at [56].

21. In October and November 2014, the Appellants replaced the garden bed and fishpond on the southern side of the rear to Number 6 with a brick wall about waist high along the boundary with number 4. In December 2016 and January 2017, they enclosed the area that Mr and Mrs Morgan had created when they extended the roof to the boundary with number 4. They laid a concrete floor including on the laneway and placed bifold doors at one end and a glass door at the other. [27] The result of those works is that a room of the dwelling on Number 6 effectively spread across the right of way to the fence as shown below:

27. Sheppard at [52].

24. This photograph is taken from the rear of Number 6 looking down the right of way to the street. The tape measure shows the width of the right of way. The view from this point to the rear of Number 6 is pictured below:

25. Again, the tape measure shows the width of the laneway. The brick wall to the left is the wall described at [21]. At the far end of this photograph is the southwest corner of the site where the sewer manhole is located. The Appellants rebuilt an area next to that as a smaller garden bed using rough sandstone blocks. [28]

    28. Sheppard at [54].

26. According to the primary judge, in 2019 the local council took “formal action” against the Appellants over the unauthorised work at Number 6. In particular, they were required to “demolish and remove all structures and extension installed to” the right of way. However, enforcement was “put on hold pending the outcome of these proceedings”. [29] His Honour found that the sewer manhole is “still a functioning part of the sewerage system and, as such, must be kept available for access by Sydney Water when required.”[30]

    29. Sheppard at [64].

    30. Sheppard at [65].

The Notation of the Right of Way on the Respondents’ Title

27. The primary judge accepted the evidence of Ms Munro that she was aware of the existence of the right of way from the time that Number 8 was purchased in 2008. [31] His Honour also found that, at least from 2010 onwards, the Respondents “were aware that the L-shaped [strip] did not belong to [N]umber 6 and they … took active steps to have their right of way registered on [N]umber 8’s title.”[32]

    31. Sheppard at [94].

    32. Sheppard at [94].

28. Senior Counsel for the Appellants, Mr Sirtes SC, contended that the notation of the right of way on the unqualified title to Number 8 in 2010 was just a by-product of the process of registering a delimitation plan. However, the evidence clearly supports the primary judge’s finding. The delimitation plan that was lodged in June 2010 specifically identified the right of way including its source. The accompanying surveyor’s report that was lodged with the plan stated that the “subject parcel has a valid appurtenant right of way over the land shown as Right of Way” and that “[n]o evidence could be found as to the release of the Right of Way or the extinguishment of the Right of Way through common ownership”.

29. On 1 July 2010, the Respondents received a “lodging party requisition” from the Department of Lands, making reference to the right of way and noting that the consent of the adjoining owners in relation to the common boundary was required. The Respondents’ solicitors passed on the requisition to the Respondents. Ms Munro responded to the solicitors in an email that stated, inter alia:

“You have asked us to get Lot 1 DP997250 to sign a copy with the consent for boundary. Does the boundary mean the dilapidated fence? Does this also mean the right of way? Will the right of way get noted on the folios?”

30. The primary judge accepted Mr Smith’s evidence to the effect that on a “handful of occasions” he accessed the backyard to Number 6 while it was owned by Mr and Mrs Morgan but that they “may not have even been aware of it”. [33] His Honour accepted that they granted permission for access by a surveyor, although “there [was] little evidence that once registration of the right of way was obtained the [Respondents] made any real attempt to exercise it”[34] which was “hardly surprising” given that it was not “readily trafficable”. [35]

    33. Sheppard at [95].

    34. Sheppard at [79].

    35. Sheppard at [97].

Abandonment – s 89(1)(b)

31. In relation to abandonment, s 89 of the CA relevantly provides:

“89    Power of Court to modify or extinguish easements, profits à prendre and certain covenants

(1)   Where land is subject to an easement … the Court may from time to time, on the application of any person interested in the land, by order modify or wholly or partially extinguish the easement … upon being satisfied—

…

(b)   that the persons of the age of eighteen years or upwards and of full capacity for the time being or from time to time entitled to the easement … whether in respect of estates in fee simple or any lesser estates or interests in the land to which the easement … is annexed, have agreed to the easement … being modified or wholly or partially extinguished, or by their acts or omissions may reasonably be considered to have abandoned the easement … wholly or in part,

...

(1A)   For the purposes of subsection (1)(b), an easement may be treated as abandoned if the Court is satisfied that the easement has not been used for at least 20 years before the application under subsection (1) is made.” (Emphasis added.)

32. Section 89(1A) was introduced into the CA by the Real Property and Conveyancing Legislation Amendment Act 2009 (NSW).

The Primary Judge’s Reasoning on Abandonment

33. The primary judge’s reasoning for rejecting the Appellants’ case on abandonment can be summarised by reference to seven points.

34. First, his Honour noted the difficulty in inferring abandonment based upon non-user by the owner of the dominant tenement, concluding that “[n]on-user must almost always be explicable on the basis that the dominant owner has no present need to use the easement, but nevertheless wishes to retain the benefit of it for the future”. [36]

    36. Sheppard at [112].

35. Second, his Honour rejected a contention raised on behalf of the Appellants that the effect of s 89(1A) was that “non-user for a period of twenty years in effect operated as a separate ground for extinguishment alongside the common law principles traditionally applied under s 89(1)(b)”. [37] Instead, his Honour concluded that its effect is that “where there is no user of an easement for twenty years, and no other evidence to negate the intention of the person benefiting from the easement to abandon it, the condition for extinguishment is established” but that “[i]t does not otherwise affect the application of the traditional common law approach to abandonment”. [38]

    37. Sheppard at [139].

    38. Sheppard at [145].

36. Third, the primary judge found that the power conferred by s 89(1) is applicable to property registered under the RPA. The primary judge addressed whether s 89(1)(b) of the CA empowers the Court to extinguish an easement by reason of the conduct of previous owners of the dominant tenement engaged in prior to the Respondents acquiring title, notwithstanding the indefeasibility of that title. His Honour found that he was “inclined” to conclude that he was bound by the decision of this Court in Pieper v Edwards [1982] 1 NSWLR 336 (“Pieper”) to find that s 89(1)(b) had that effect. [39] However, his Honour concluded that it was not necessary to finally determine that issue presumably because, based on the facts his Honour found, no such abandonment could be inferred. No notice of contention was filed in this Court on behalf of the Respondents. Both parties proceeded on the basis that the power conferred by s 89(1)(b) of the CA could be engaged by reason of the acts of predecessors in title to the dominant tenement.

    39. Sheppard at [172].

37. Fourth, consistent with the third point, the primary judge addressed whether the conduct of the previous owners of Number 8, specifically Ms McJannet, demonstrated an intention to abandon the right of way. His Honour accepted that there was no evidence that Ms McJannet ever used the right of way or asserted an entitlement to do so. However, his Honour also noted it was “impossible to say” whether she was aware of the right of way and that all that was “established during her period of ownership is non-user and no intention to abandon the right of way should be inferred on that account.”[40]

    40. Sheppard at [175].

38. Further, his Honour did not accept that there were any other features of the land from which an inference of abandonment by Ms McJannet could be drawn. By reference to the facts and reasoning in Treweeke v 36 Wolseley Road Pty Ltd (1973) 128 CLR 274; [1973] HCA 27; “Treweeke”) his Honour concluded that, whether the fence between the properties was built by Ms McJannet or one of her predecessors in title, the construction and presence of the fence did not give rise to an inference of abandonment. [41] With the various obstacles to the exercise of the right of way built by the proprietors of Number 6, his Honour found that there was no evidence of any objection to them by Ms McJannet, nor encouragement by her either, and that otherwise “[t]he fact that the dominant owner does not, for the time being, expend the money required to make an easement useable does not of itself lead to an inference of abandonment”. [42] His Honour ultimately concluded:[43]

“I am therefore not sure that the fact that ownership of the servient land was in limbo is itself an answer to the [Appellants’] claim of abandonment. Even so, I do not think that, taken together, the evidence is sufficient to establish abandonment by Miss McJannet. It establishes non-user but does not go so far as to demonstrate a settled intention that the right of way would never be exercised in future.”

41. Sheppard at [176].

42. Sheppard at [177]-[178].

43. Sheppard at [182].

39. Fifth, the primary judge then addressed the conduct of the Respondents since they acquired Number 8 in 2008. The relevant portion of his Honour’s judgment was as follows:

“183   I turn now to the period after number 8 was acquired by the [Respondents] in 2008. On my findings, the non-user continued after that date. The incursions by Mr Smith in 2009 and the carrying of a table across the backyard for the owner of number 10 did not involve any assertion of a right of way over the area. Nor am I satisfied that the access by surveyors in 2010 (which I am satisfied was consented to by Mrs Morgan) took place in reliance on the existence of the right of way. But again all the evidence establishes is non-user.

184   The [Respondents’] construction of a new fence in 2015 is similarly indecisive. On my findings, the [Respondents] did not regard the fence as permanent. As subsequent events were to show, the cost of making an opening in the fence would not be large. The shed which was present in the [Respondents’] backyard from November 2015 to January 2019 is of even less significance.

185   Nor was there any relevant change so far as the obstruction of the right of way was concerned. The removal of the garden bed on the southern side of the garden in fact made that part of the area covered by the right of way accessible again. The enclosure of the covered area was undertaken without the [Respondents’] (or the council’s) consent. The right of way is still not readily trafficable because of the rear garden bed and the difference in height between the manhole cover in the south-western corner and the adjoining areas of the right of way. Both of these features have been present for decades. The demolition order by the council will not apply, so that if the right of way is to be readily trafficable, the [Respondents] will probably have to pay for the necessary works. But for reasons I have given that does not establish abandonment.

186   The events since the [Respondents] bought number 8 thus take the [Appellants] no further. In fact they lead in the opposite direction.

187   From December 2018 onwards, once the [Appellants’] primary application had been notified to them, the [Respondents] expressly asserted their wish to retain the right of way. They in fact attempted to exercise the right of way in April 2019, until prevented by the threat of calling the police, and later by the injunction obtained by the [Appellants].

188   As already noted, Mason J appears to have accepted in Treweeke that s 89(1) operates on the basis that an easement which is the subject of an application remains valid until it is extinguished by order of the Court. In the present case, the [Appellants] seek relief only under s 89(1). No relief is sought under s 89(3). Consistently with this, there was no attempt by counsel for the [Appellants] to contend that abandonment had taken place before December 2018.

189   In passing, it should be noted that if Mason J’s view of s 89(1) is correct, the [Respondents] were fully entitled to make use of the right of way when Mr Smith attempted to do so in April 2019. The same was so when the injunction was given in May 2020. With hindsight it can be seen that there was never any entitlement to an injunction in aid of the [Appellants’] claim under s 89(1).

190   Thus at the time the Court has come to consider the application (and at the time the proceedings were begun) the [Respondents] have had a valid and effective right of way which they have [been] seeking to exercise and which they can be seen in retrospect to have been entitled to exercise. The evidence affirmatively and definitively negatives abandonment. The [Appellants] must fail for that reason alone.

191   What I have just said is based on the [Respondents’] conduct since they lodged their caveat in December 2018. But in fact, the [Respondents] were aware (or at least Ms Munro was aware) of the right of way from the time they bought number 8 and they went to the trouble to have it noted on their title in 2010. I think that conduct is itself sufficient to manifest an intention to retain the benefit of the right of way, and to negative abandonment.”

40. Sixth, His Honour addressed the operation of s 89(1A). His Honour noted that s 89(1A) required a period of at least 20 years of non-user before the application for extinguishment was “made” although it was not clear if the application was “made” when it was filed or only when it was heard. [44] However, his Honour concluded that it did not matter:

“194 I have already explained why I think that s 89(1A) does not result in an abandonment if there is actual evidence of an intention not to abandon the easement in question. In the present case, there is evidence negativing any intention to abandon the right of way on the part of the [Respondents]. In my view the [Respondents] manifested that intention from December 2010 onwards, and it was unmistakeable from December 2018 onwards. Non-user over a period of more than twenty years before the application was made (which non-user was only achieved by preventing the [Respondents] from exercising their rights) does not assist the [Appellants].”

44. Sheppard at [192]-[193].

41. The reference to “December 2010” is to the filing of the delimitation plan which led to the notation of the right of way on title. The reference to December 2018 onwards is to the period from when the Respondents were notified of the Appellants’ application for possessory title in that from that time the Appellants expressly asserted their wish to retain the right of way. [45]

    45. Sheppard at [187].

42. Seventh, based on Pieper, the primary judge concluded that the power conferred by s 89(1) is discretionary. In circumstances where the Respondents acquired Number 8 and “had the easement noted on their title, long before the [Appellants] acquired title to the servient land”, his Honour found that even if s 89(1)(b) had been satisfied then he would have declined to exercise the discretion to extinguish the right of way. [46]

    46. Sheppard at [201].

Grounds of Appeal Relating to Abandonment

43. The first five of the seven grounds of appeal concern abandonment. They provide:

“Ground 1: That the Trial Judge erred in finding that the easement, being a right of way registered on the Appellants’ land, had not been abandoned.

Ground 2: That the Trial Judge erred in finding that the Respondents’ conduct did not establish an intention to abandon the easement.

Ground 3: That the Trial Judge erred in finding that the Respondents manifested an intention not to abandon the right of way from December 2010 onwards.

Ground 4: That the Trial Judge erred in determining the issue of abandonment, by determining the issue by reference to subjective considerations of the Respondents rather than their acts as reasonably understood.

Ground 5: That the Trial Judge should have found the lengthy period of non-user, together with the Respondents’ conduct, established abandonment.”

44. The Appellants’ submissions stated that ground 1 was subsumed under grounds 2 to 5. Grounds 2 to 4 are concerned with the conduct of the Respondents. Ground 5 is directed towards the primary judge’s findings in respect of the conduct of Ms McJannet (and the conduct of the Respondents). It is premised on the correctness of the third point noted above. Although the Appellants’ submissions discussed s 89(1A) of the CA, they did not contend that the primary judge’s construction of that provision was wrong.

Abandonment: Approach

45. A conclusion that the owner of the dominant tenement has abandoned an easement over the servient tenement is a finding of fact (Treweeke at 282 per McTiernan J; at 302 per Mason J). The ultimate issue is whether an inference of abandonment should be drawn “taking into account all the matters of fact which may tend towards or against a conclusion that the easement may reasonably be considered to have been abandoned” (Treweeke at 287 per Walsh J).

46. It has been said that “a firm intention [on the part of the owner of the dominant tenement] that neither he nor any successor in title of his should thereafter make use of the easement” is required and that “[a]bandonment is not … to be lightly inferred” (Gotobed v Pridmore (Court of Appeal (UK), 16 December 1970, unrep); as later cited in Williams v Usherwood (1983) 45 P & CR 235 at 256; “Williams”). Thus, a right of way will not necessarily be extinguished by non-user alone (Treweeke at 284 per McTiernan J; at 302 per Mason J). However, acquiescence in, and failure to object to, the placing by the owner of the servient tenement of obstructions on the right of way which are inconsistent with its exercise may lead to an inference that the owner of the dominant tenement intended to abandon it (Treweeke at 303 per Mason J).

45. The potential for disagreement over the essentially factual inquiry into abandonment is best illustrated by Treweeke. The right of way that was said to be abandoned was granted in 1927 over a three-feet-wide strip of land on the servient tenement so as to allow access by the owners of the dominant tenement to the beach at Double Bay. The strip was impassable by reason of vertical cliff faces and from 1928 because of a bamboo plantation. In 1956, a pool was constructed over part of the right of way near the waterfront and a fence across the right of way was erected in 1958. A chain wire fence was erected across the right of way on the dominant tenement in 1933 and then again in 1967 and both times that was done at the cost of the owner of the dominant tenement and the servient tenement. The occupants of the dominant tenement accessed the beach through another property, but that route became unavailable in 1967.

46. Both McTiernan and Mason JJ held that it had not been shown that the right of way was abandoned. Justice Walsh dissented.

47. Justice McTiernan concluded that “the non-user of the total length of the [right of] way can reasonably be put down to its precipitous condition at places” and noted that “it is not reasonable to attribute non-user to renunciation of such a pleasant amenity as a path to the beach”. His Honour referred to instances of the assertion of a right of way including the undertaking of a survey (as occurred here) and the respondent's agent advising incoming purchasers of units on the dominant tenant of the existence of the right of way (at 285). His Honour described the gate constructed on the dominant tenement as “not expensive” and “movable” (at 283) and noted that the owners of the dominant tenement complained about the pool when they learned of the existence of the right of way (at 285).

48. Justice Mason concluded that the non-user and other acts and omissions of the Respondent “were equally consistent with the existence of an intention not to use the right of way whilst an alternative means of access [to the beach] remained available” (at 303-304) especially as the right of way “could not be effectively used until it was made suitable for pedestrian use by appropriate expenditure.” Justice Walsh, in dissent, drew an inference of abandonment from the long period of non-user “coupled with acquiescence in acts which where adverse to the user of the right of way” (at 293).

49. In this Court, the Appellants’ written submissions placed great emphasis on the following passage from the speech of Viscount Cave LC in Swan v Sinclair [1925] AC 227 (“Swan”) (at 237):

“Even if the right of way claimed had been effectively granted to the appellant’s predecessors in title in the year 1871, the non-user of the way for upwards of 50 years, coupled with the fact that throughout that time the appellant and his predecessors acquiesced in the continuance of the walls running right across the proposed roadway and (since 1883) in the additional obstruction caused by the filling up of the strip of land on lot 1, would … have been good ground for inferring a release or abandonment of the easement.” (Citations omitted.)

52. This statement needs to be treated with caution. In Swan, the origin of the alleged easement was various agreements entered into in 1871 to create an easement, which were held not to have been given effect. At the time those agreements were entered into, the easement was not trafficable due to a substantial garden wall dividing the lots. Lord Wrenbury described the position as follows (at 243 to 244):

“My Lords, if in 1871, when the conveyances were executed, the grant to each purchaser had been a grant of a right of carriageway to be enjoyed in presenti over a strip of land over which it was physically possible for a carriage to pass, a question would have arisen which is not the question in this case. In that supposed case the question might have been whether non-user for 50 years was evidence of abandonment of an incorporeal hereditament created by deed. The material enquiry would have been whether the grantee of the right had in that state of facts the intention to renounce the right. The facts here are that the grant to each purchaser was a grant of a right of carriageway to be enjoyed in futuro over a strip of land upon which work had to be done before a carriage could pass over it.”

53. His Lordship later described Swan as a case that did not involve abandonment of an easement by acquiescence “but a case of acquiescence in the non-performance of acts … necessary to be done before the right can possibly be exercisable” (at 245).

54. Given this aspect of Swan, it is not surprising that in Williams (at 256) the Court of Appeal cited the following passage from the dissenting judgment of Sir Ernest Pollock MR in the Court of Appeal in Swan v Sinclair [1924] 1 Ch 254 (at 266) as a correct statement of principle concerning abandonment:

“Non-user is not by itself conclusive evidence that a private right of easement is abandoned. The non-user must be considered with, and may be explained by, the surrounding circumstances. If those circumstances clearly indicate an intention of not resuming the user then a presumption of a release of the easement will, in general, be implied and the easement will be lost.”

Ground 3: Erred in Finding a Manifest Intention

55. This ground contends that the primary judge erred in finding that the Respondents “manifested an intention not to abandon the right of way from December 2010 onwards” (see [39] and [40] above). [47] The Appellants’ principal complaint is that his Honour erred in finding that the Respondents “went to the trouble” of having the right of way noted on their title in 2010 and that such conduct was “itself sufficient to manifest an intention to retain the benefit of the right of way, and to negative abandonment”. [48] The Appellants contended that “[t]aking steps to ensure … a Certificate of Title is accurate is not of itself sufficient to ‘manifest’ an intention not to abandon a right of way”, especially in circumstances where no further steps are taken to assert the right of way.

    47. Sheppard at [191], [194].

    48. Sheppard at [191].

56. The findings and evidence concerning the steps taken by or on behalf of the Respondents in relation to the notation of the right of way on the Certificate of Title to Number 8 are set out above. Ms Munro clearly knew of its existence from 2008 and specifically queried whether it would be noted on the Certificate of Title following the lodgement of the delimitation plan. With respect, his Honour was clearly correct to find that the Respondents “went to the trouble” of having it noted on their title. Moreover, contrary to the Appellants’ submissions, at least in this case, that act clearly did manifest an intention to retain the benefit of the right of way. In Treweeke, McTiernan J treated each of: the procuring of a survey to determine the “precise course of the right of way”; the owner’s agent informing each incoming purchaser of an apartment in the dominant tenement of the existence of the right of way; and correspondence from the registered owner complaining about the existence of the swimming pool, as evidence of intention to retain the right of way (at 285). Taking specific steps to record the existence of a right of way onto a certificate of title which is then available to anyone who searches the register is a very public form of affirmation of the existence of the right of way. The primary judge did not err in attributing significance to that act.

57. I would reject ground 3.

Ground 2: Erred in Not Finding an Intention to Abandon

58. This ground is directed to the primary judge’s reasoning in failing to find an intention to abandon the right of way on the part of the Respondents by reason of their conduct from the time they purchased Number 8 in 2008 apart from the registration of the delimitation plan.

59. The relevant part of the primary judge’s reasoning is set out above (at [39]). [49] The Appellants contended that that reasoning is affected by two errors. The first contention was that the authorities make it clear that the “non-user of a right of way can be highly pertinent to the issue of abandonment”. The authorities relied on by the Appellants in support of that contention include Swan, which has already been addressed, and Chiu v Healey [2003] NSWSC 857 where Young CJ in Eq (at [36]) noted that “[l]ong non-user will be good evidence, but will not necessarily be sufficient to establish abandonment” (citing Swan; Treweeke and Proprietors Strata Plan 9,968 v Proprietors Strata Plan 11,173 [1979] 2 NSWLR 605). The Appellants contended that “[c]ontrary to the [primary judge’s] findings” the Respondents non-user between 2008 and 2018 was “good evidence” of abandonment.

    49. Sheppard at [183]-[186].

60. This complaint mischaracterises the primary judge’s reasons. His Honour did not reject the contention that non-user was capable of being “good evidence” of abandonment and did not otherwise treat it as neutral on the question of abandonment. Instead, consistently with the authorities, his Honour treated it as insufficient in its own right and something that had to be considered with the other circumstances, including the positive steps taken by the Respondents in 2010 to have the right of way noted on the title to Number 8. Further, in this case, the Respondents’ non-user must be considered in a context where from the time they acquired Number 8 the right of way was not trafficable and there existed an alternative means of accessing the street, namely, through their front door (Treweeke).

61. The second error contended for by the Appellants was said to be the failure of the primary judge to consider the combination of the Respondents’ non-user during the period from 2008 to 2018 with what the Appellants contended were “three affirmative steps” taken by the Respondents that disavowed the right of the way. Those three affirmative steps were: the replacement of the boundary fence without the installation of a gate; the installation of the knee wall against their own back wall in December 2013; and the construction of a garden shed in their own back yard that was said to be “close” to the boundary fence that would hinder access to the right of way.

62. The primary judge found that the construction of the new paling fence was “indecisive” so far as intention to abandon was concerned (see [39]). [50] His Honour noted that the Respondents did not “regard the fence as permanent”. This was a reference to an earlier part of the judgment that recounted Mr Smith’s evidence that it was a “simple fence” built during renovations that became more expensive than anticipated and “constructed on the understanding that the question of access to the former laneway could be pursued at a later time”. [51] His Honour recounted that Mr Smith was challenged on this in cross‑examination but observed that his evidence was consistent with contemporaneous emails which were in evidence. Mr Sirtes was critical of this finding on the basis that the emails did not recount this understanding and his Honour was otherwise considering his subjective intentions rather than considering whether by his “acts or omissions [he] may reasonably be considered to have abandoned the easement”.

    50. Sheppard at [184].

    51. Sheppard at [87].

63. There is some force in Mr Sirtes’ criticism. In June 2013, Mr Smith sent an email to the Appellants advising them that “[d]ue to a major hole in our cash flow” the fence had a “reduced design” which “[w]e can always revisit … when you do your reno[vations].” Neither that email nor any other referred to access to the laneway. However, that does not take the matter far. On his Honour’s findings the fence was not permanent. It was a wooden paling fence which cost little to modify (or even to remove). The same applies to the steel post noted above. The fence and the post were no different in substance to the fencing considered in Treweeke which included fencing erected on the land of the owner of the dominant tenement (see also Ashoil Holdings Pty Ltd v Fassoulas (2005) 12 BPR 98195; [2005] NSWCA 80 at [54] and [57] per Tobias JA; “Ashoil”). The form of the fence that was constructed in this case was very much consistent with a lack of an immediate intention to use the right of way, something that was not surprising given that it was not trafficable. However, the construction of the fence was little, if any, evidence of a permanent intention to abandon the right of way especially as it was built so soon after the Respondents took active steps to have the right of way recorded on the title.

64. The primary judge was dismissive of the construction of the shed as manifesting an intention to abandon the right of way. His Honour found that it was of “less significance” than the fence (see [39]). [52] His Honour found that the shed was constructed in 2015 and removed in 2019. Beyond that, there were no primary findings of fact made by the primary judge which would undermine his Honour’s conclusion and none were sought on appeal. The Appellants contended that the fence was so close to the boundary fence that it “hinder[ed] access to the right of way”. There was no finding to that effect but even if there were, it was the lack of permanence of the shed that warranted his Honour’s findings.

    52. Sheppard at [184].

65. As noted, the knee wall extends to the edge of the former laneway on Number 8’s side of the fence. At that point, its width is 41.5cm compared to a width of 1.045m for the right of way. [53] A photograph in the primary judgment suggests it impedes access to the right of way but does not preclude access. [54] When addressing obsolescence the primary judge found that it would be necessary “to install a gate and perhaps undertake further works such as removing the steel post and modifying the knee wall, so as to provide access”. [55]

    53. Sheppard at [50]; [33].

    54. Sheppard at [33].

    55. Sheppard at [219].

66. Overall, the Appellants relied on the passage from the judgment of Mason J in Treweeke noted above (at [45]) (even though that proposition concerned acquiescence in acts by the owner of the subservient tenement whereas in this case the Appellants did not own the L-shaped strip until 2018). The Appellants contended that this was not an instance of the owner of the dominant tenement merely consenting to the erection of a fence over the right of way but an instance where the Respondents instigated the further obstruction of the right of way through actions they carried out on their land. However, at the risk of repetition, in a context where the Respondents had relatively recently taken “active steps” to record the right of way on their title, the erection of those non‑permanent features did not manifest an intention to abandon the right of way.

67. There was no error in the primary judge’s approach. I would reject ground 3.

Ground 4: Subjective Considerations

68. Ground 4 of the appeal concerns that part of the primary judge’s reasons from [187] to [191] and [194] which are set out above. The Appellants contended that the primary judge erred in “assessing the issue of abandonment by reference to the Respondents’ conduct after they were notified of the Appellants’ application for possessory title in November 2018 and their statements made in the course of the proceedings regarding their intentions for future use of the right of way”. The Appellants contended that his Honour should have addressed abandonment by reference to an objective consideration of the Respondents’ conduct from the time they purchased Number 8 “to the time of the dispute”. The submissions contended that his Honour wrongly placed weight on the Respondents’ future intentions in relation to the right of way in that his Honour had previously noted that the Respondents gave evidence of an “ongoing wish” to be able to use the former laneway as a right of way for such reasons as carrying sporting equipment, household goods and bulky items. [56]

    56. Sheppard at [93].

69. The Appellants further contended that the effect of [190] of the primary judgment was that no (contested) claim for abandonment could ever succeed because any assertion by a dominant owner that they have an intention to use an easement will be “sufficient to thwart a claim for abandonment, regardless of the fact that the assertion may have been expressed only after a dispute has arisen (or, as in the present case, in the course of evidence in the proceedings).”

70. These contentions do not accurately reflect his Honour’s reasoning in [187] to [191] and [194] of the primary judgment. Three matters should be noted. First, while it is correct that elsewhere in his Honour’s reasons reference was made to the Respondents’ intention to use the right of way, his Honour did not consider that aspect of their evidence in this part of the reasoning. Instead, in the paragraphs of the judgment set out at [39] and [40], his Honour considered the acts and statements of the Respondents between 2018 and the commencement of the litigation.

71. Second, although it is not entirely clear, I do not understand that [187] to [191] of Sheppard involve his Honour assuming that, leaving aside s 89(1A), if an abandonment for the purposes of s 89(1)(b) at some point prior to 2018 had been established, then the power conferred by that provision would not arise because of some acts or statements by the Respondents thereafter that positively manifested an intention to retain the right of way. If that were the basis upon which his Honour acted, then I would have strong doubts that that is the correct construction of s 89(1). I cannot discern anything in the judgment of Mason J in Treweeke which supports that approach. However, I do not understand that his Honour construed s 89(1) in that way. Instead, I understand that [187] to [191] of the primary judgment involve his Honour completing the narrative of the conduct of the Respondents from 2008 onwards. In effect his Honour found that: they took active steps in 2010 to have the right of way noted on the title; the work they did on Number 8 from that time to 2018 did not manifest an intention to abandon the right of way; and their conduct from 2018 also manifested a positive intention to retain it and exercise it.

72. Third, in [194] of the primary judgment his Honour addressed s 89(1A) in the context of an earlier finding that there must be a 20-year period of uninterrupted non-user before the application is made. The Appellants did not challenge that construction of s 89(1A). Given that construction, his Honour’s finding that from 2018 there was an “unmistakeable” intention not to abandon the right of way was fatal to the Appellants’ reliance on s 89(1A).

73. I would reject ground 4.

Ground 5: Ms McJannet and the Respondents’ Conduct

74. Ground 5 is directed to the primary judge’s findings regarding the lengthy period of non-user of the right of way prior to the Respondents’ acquiring Number 8 when considered with the Respondents’ conduct after they acquired ownership. To the extent this ground concerns the Respondents’ conduct, it adopts the complaints made in relation to grounds 2, 3 and 4 which have already been rejected. The balance of the ground concerns the fourth part of the primary judge’s reasoning on abandonment summarised above (at [37] to [38]).

75. The Appellants’ submissions referred to the primary judge’s findings that the fence between Number 6 and Number 8 was present for “decades”, that there was no evidence that Ms McJannet ever used the right of way or asserted any right to do so and the right of way was not readily trafficable due to the obstacles constructed on behalf of the owners of Number 6. Based on those findings, the Appellants contended that the primary judge erred in characterising Ms McJannet’s period of ownership as only involving non-user. In particular, the Appellants contended that the primary judge erred in:

“… not hav[ing] due regard to the following relevant circumstances which demonstrate an acquiescence by Miss McJannet in acts which were adverse to the user of the right of way during the 52 years she owned No. 8:

a.   that she did not assert any entitlement to use the right of way at any stage during her ownership of No. 8 (nor remonstrate with the then owners of No. 6 of her interest in, or entitlement to use the right of way);

b.   that she did not at any stage announce any intention to use the right of way;

c.   that she (or one of her predecessors in title) likely constructed the boundary fence between Nos. 6 and 8 which cut off No. 8’s access to the right of way; and

d.   that she did not dismantle the boundary fence between Nos. 6 and 8 nor have a gate fitted.”

76. The difficulty with this contention is that it overlooks that his Honour’s characterisation of the period of ownership of Number 8 by Ms McJannet as involving non-user followed from an absence of evidence about her conduct during that period. Hence, contrary to this submission, it was not established that she “did not assert” any entitlement to use the right of way. Instead, his Honour only found that there was “no evidence” that Ms McJannet did so. [57] His Honour also found that it was “impossible to say whether [Ms] McJannet was even aware of the right of way.”[58] Similarly, his Honour found that there was “no evidence” of any objection by Ms McJannet to the obstacles that were constructed on Number 6 “but no evidence of any encouragement by her either”. [59] An absence of evidence of an assertion of an entitlement to a right of way and objection to obstacles being built on the right of way, when coupled with an absence of evidence of knowledge to the right of way does not translate to a finding of acquiescence.

    57. Sheppard at [174].

    58. Sheppard at [175].

    59. Sheppard at [177].

77. Otherwise, his Honour found that what was known about the fence between the two properties during the period of Ms McJannet’s ownership of Number 8 was no different to the fences considered in Treweeke. I see no error in that approach.

78. The balance of the Appellants’ submissions on this ground contended that the long period of Ms McJannet’s non-user coupled with her acquiescence in acts adverse to the right of way justify the application of the approach stated by Viscount Cave LC in Swan. As noted, the primary judge’s findings do not support a suggestion of acquiescence and caution should be exercised in relying on that passage from Swan.

79. I would reject ground 5.

Obsolescence

The Trial Judge’s Approach

80. Section 89(1)(a) of the CA empowers the Court to modify or wholly or partially extinguish an easement upon being satisfied:

“that by reason of change in the user of any land having the benefit of the easement … or in the character of the neighbourhood or other circumstances of the case which the Court may deem material, the easement … ought to be deemed obsolete, or that the continued existence thereof would impede the reasonable user of the land subject to the easement … without securing practical benefit to the persons entitled to the easement … or would, unless modified, so impede such user”.

81. The primary judge described this provision as containing two limbs. The first is whether by change in use of any land having the benefit of the easement it “ought to be deemed obsolete”. [60] The second is whether the continued existence of the easement would impede the reasonable user of the Appellants’ land without securing any practical benefit to the Respondents. The primary judge did not accept that either limb was established. [61] The Appellants’ written submissions appear to only take issue with the finding in relation to the first limb, although the oral submissions travelled further.

    60. Sheppard at [204].

    61. Sheppard at [203]-[213] and [214]-[219].

82. In relation to the first limb, the primary judge addressed and rejected a submission that the right of way became redundant when sewerage connections were built in 1908. His Honour found that it was not shown that that was the right of way’s only purpose. His Honour considered that the critical factor was the terms of the grant of the right of way which was not limited; it was a “right of way for any lawful purpose” not limited to the removal of nightsoil; it was a “general right of way”. [62] In a passage that is the subject of criticism in the Appellants’ written submissions, the primary judge observed:[63]

“I have already explained in an abandonment context that the fact that expenditure may be required to make the right of way readily trafficable does not mean that it is useless. The same is so when considering its obsolescence. The right of way is capable of being restored to its former condition as a rear access laneway and on my findings there is no reason to question the [Respondents’] desire to do so. In my view it is not obsolete.”

62. Sheppard at [209].

63. Sheppard at [213].

83. In relation to the second limb, his Honour found that the Appellants had to demonstrate that no reasonable user of their land was possible and merely having a “‘compressed’ backyard” would not have satisfied that test. [64] His Honour was also not satisfied that there was a lack of practical benefit secured to the Respondents in maintaining the easement given that they had expressed a wish to use the right of way which his Honour found to be genuine. His Honour observed that, although the Respondents might have to pay for work to be done to make the passage trafficable, that did not mean that the right of way did not secure a practical benefit to them. [65]

    64. Sheppard at [216]

    65. Sheppard at [219].

Ground 6: Alleged Error in Relation to Obsolescence

84. Ground 6 of the notice of appeal contends that the primary judge erred in finding that the easement was not obsolete.

85. The written submissions in support of this ground contended that the primary judge’s finding on obsolescence relied on two findings in the last sentence of the extract set out above (at [82]), namely, that the fact that expenditure may be required to make a right of way readily trafficable “does not mean that it is useless” and an acceptance of the Respondents’ intention to restore the right of way to its former condition as a rear access laneway. This appears to relate to the primary judge’s findings on the first limb of s 89(1)(a) concerning obsolescence.

86. In relation to that limb, by reference to the judgment of this Court in Durian (Holdings) Pty Ltd v Cavacourt Pty Ltd (2000) 10 BPR 18,099; [2000] NSWCA 28 (“Durian”), the Appellants contended that the primary judge ought to have concluded that the right of way was obsolete “because of changes in the user of the land having the benefit of the easement and in the character of the neighbourhood” together with the lengthy period of non-user, the physical obstructions on Number 6 and the Respondents’ so‑called “affirmative steps to disavow use of the right of way in constructing the new boundary fence, the concrete knee wall and the shed”.

87. In Durian (at [3]), Mason P adopted a statement of Jacobs J in Re Masonand the Conveyancing Act [1962] NSWR 762 at 764; (1960) 78 WN (NSW) 925 (“Re Mason”) concerning the approach to obsolescence as follows:

“I consider that the word 'obsolete' can be taken to mean that the object of the covenant is now incapable of fulfilment or perhaps that it serves no present useful purpose.”

88. Then in a passage cited by the primary judge, Mason P observed (at [4]):

“Section 89 necessarily qualifies the common law rights of the owner of the easement. The section is to be applied according to its terms, read fairly and without disregarding the conventional approach to legislation affecting common law property rights. The starting point is the easement itself, its terms and its objects derived from construing those terms in context … and bearing in mind that the easement was created for an indefinite future and destined to enure in a changing environment”. (citations omitted)

89. In Durian, the grant of the right of way in 1964 was by its terms limited to obtaining “reasonable access to the public highways adjoining the servient tenement” (at [20]). At the time it was granted the dominant tenement was “virtually landlocked” from accessing the public highway without the easement. In the years that followed, alternative access was made available and town planning restrictions made the use of the easement impossible (at [23]). Justice Meagher described the latter as the “greatest factor tending towards obsolescence”. His Honour also considered that the fact the easement was not used for the stated purpose and the owner of the dominant tenement constructed significant physical obstructions to the use of the easement. Even allowing for the “heaviness of the onus” borne in relation to obsolescence, Meagher JA found that the easement should be extinguished (at [27]-[29]).

90. Both Mason P and Stein JA agreed. President Mason addressed one part of the primary judge’s reasoning in Durian as follows (at [11]):

“[The primary judge] did not think that the easement ought to be deemed obsolete because "the object of access is still capable of performance and is of value [as] shown by the fact that the [respondent] thought that such access was a selling point when it acquired the land and the value it has for more flexible use of the land”. This subjective consideration attributed to the respondent does not, in my respectful view, provide a basis for rejecting the case otherwise established. The easement is no longer capable of useful fulfilment in any practical sense other than as a mere bargaining tool in the hand of the dominant tenant”. (Emphasis added.)

91. Later, in addressing the extent to which the right of way may benefit the dominant tenement Mason P observed (at [13]):

“The evidence shows that the easement has not been used, cannot be presently used and is not proposed to be used for its expressed purpose.” (Emphasis added.)

92. Returning to the submission noted above (at [86]), Durian does not provide any assistance to the Appellant. The critical factors pointing to obsolescence in Durian were the limited nature and purpose of the right of way and that subsequent events rendered the use of the right of way unable to achieve that purpose, specifically the provision of access by other means and the imposition of planning controls that rendered it unable to be used. The non-use and construction of impediments simply confirmed that obsolescence. In this case there was nothing in the terms of the grant of the right of way or anything else that warrants any finding that the purpose of the right of way was restricted. Otherwise, leaving aside the construction of sewer lines, there has been no relevant change in the “character of the neighbourhood” as contended for by the Appellants (cf Ashoil at [63]).

93. As noted, the Appellants also contended that the primary judge erred in relying on the Respondents’ intentions in relation to the right of way. Relying on the passage from Durian set out above (at [90]), they contended that the subjective “asserted intentions” of the owners of the dominant tenement were irrelevant. However, as the above makes clear, the relevant subjective opinion in Durian that was irrelevant was that the right of way was a “selling point”. A genuine intention to use the right of way is not irrelevant at least when accompanied by a realistic means to make the right of way trafficable (Durian at [13]). That is what his Honour found in this case.

94. In relation to the second limb of s 89(1)(a), in oral submissions Mr Sirtes contended that, if the Court concluded that the purpose of the right of way was limited to the removal of “nightsoil”, then the continued existence of the easement would not secure any practical benefit to the Respondents. As I am not satisfied that the right of way was so limited, that contention falls away.

95. I would reject ground 6.

Lack of Substantial Injury

Reasoning of the Primary Judge

96. Section 89(1)(c) of the CA empowers the Court to order the extinguishment of an easement where “the proposed modification or extinguishment will not substantially injure the persons entitled to the easement”.

97. The primary judge cited Jacobs J in Re Mason at 928 as authority that the word “substantial” in s 89(1)(c) means not “large or considerable, but rather … non-theoretical or having present substance.” The primary judge ultimately found:[66]

“In any event, the onus lies on the [Appellants] to negative any substantial injury to the [Respondents]: see Tujilo v Watts [2005] NSWSC 209 at [36]. That means that the [Appellants] must prove that the probability of use in the future is so remote, and the financial value of the easement is so small, as to be of no present substance. The [Appellants] did not challenge the [Respondents] about their willingness to pay the cost of making the right of way usable, or lead any evidence to show that the right of way has no value. The application under CA, s 89(1)(c) fails.”

66. Sheppard at [224].

Ground 7: Substantial Injury

98. Ground 7 of the Amended Notice of Appeal provides:

“The Trial Judge erred in finding that the Appellants had not established the absence of substantial injury by imposing an evidential burden on the Appellants to prove (a) that the use of the easement in the future is "so remote" and (b) that the extinguishment of the easement would not decrease the value of the Respondents’ land.”

99. Consistent with this ground of appeal, the Appellants’ written submissions contended that the primary judge’s approach as set out above placed too high a burden on them as the party seeking extinguishment. They contended that there was no basis in the authorities for requiring the use of the easement to be “so remote” and the financial value “so small” as to be of no present substance. I do not understand that his Honour intended those phrases to be some form of substitute for the approach stated by Jacobs J in Re Mason. In a case involving a right of way which is not trafficable and has not been used for some time, I understand that the use of the phrases was meant to convey nothing more than the necessity to undertake an evaluative exercise as to whether the extinguishment of the easement would not substantially injure the Respondents.

100. The balance of the written submissions reiterated the length of the period of non-user and the obstructions on the right of way as somehow demonstrating a lack of substantial injury from extinguishment. In oral submissions, Mr Sirtes contended that the fencing of the easement for a number of years and the taking of steps to impede the use of the right of way “could be seen as an admission against the owners … of the dominant tenement that the easement had no substantial value, utility or advantage.” The contention that those acts constitute an “admission” is a novel one and does not appear to have been made at first instance. In any event, the contention could not travel any higher than the reliance on these acts in relation to abandonment. If the Respondents’ actions do not amount to proof of a permanent intention to abandon the right of way, then they equally do not amount to an admission that the right of way has no substantial value or utility. Even if they were admissions to that effect, they could not be binding and are inconsistent with the primary judge’s findings that the Respondents had a genuine intention to use the right of way. [67]

     67. Sheppard at [219].

101. I would reject ground 7.

Conclusion

102. It follows that I consider the appeal must be dismissed. I propose the following orders:

1. Appeal dismissed.

2. The Appellants pay the Respondents’ costs of the Appeal.

   103. BASTEN AJA: I agree with Beech-Jones JA.

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Endnotes

Decision last updated: 29 August 2022