Slorach v Mountain View Farm Pty Ltd

IN THE SUPREME COURT

OF QUEENSLAND

CAIRNS

No. 55 of 1998

No. 51 of 1998

Before the Hon. Justice Jones

[Slorach -v- Mountain View Farm Pty Ltd; Mountain View Farm Pty Ltd v Sing] [2000] QSC 069

BETWEEN:

HAFWEN MICHAEL SLORACH

First Plaintiff

AND:	CRAIG STEPHEN SING and JOANNE DAISY SING

Second Plaintiffs

AND:	MOUNTAIN VIEW FARM PTY LTD.

Defendant

JONES J

Judgment delivered 17th Day of February, 2000

1.     That it be declared that the easement over the land described as Easement A in Lot 100 on Registered Plan Number 846540, County of Nares, Parish of Hull is held on trust by the Plaintiff for the Defendant.
2.     That the said Easement be extinguished.
3.     That the register be amended accordingly.
4.     That the First Plaintiff pay the Defendant’s costs of and incidental to this action including reserved costs to be taxed.
5.     That the Second Plaintiffs be jointly and severally liable for costs as from the date when the Second Plaintiffs became a party to the action and from that date pay the Defendant’s costs of and incidental to the action to be taxed.
6.     That note is taken of the undertaking to the Court given by the First Defendant that up to and including the 30th June 2000 it will not, whether by itself or its servants or agents or otherwise howsoever obstruct or interfere with:-
(a)              Vehicular access to the land described as Lot 2 on Registered Plan Number 749972, County of Nares, Parish of Hull over and along:-
(i)               The land described as Easement A in Lot 100 on Registered Plan Number 846540, County of Nares, Parish of Hull; and

(ii) Any further part of Lot 100 on Registered Plan Number 846540 as
may be reasonably necessary for vehicular traffic to deviate from
the alignment of the said Easement to and from the existing bridge
across Big Maria Creek.

7. That the Plaintiff’s claim in this action be dismissed.
8. That the parties have liberty to apply on 24 hour’s notice.

Catchwords:	EASEMENTS AND PRESCRIPTIONS - EXTINGUISHMENT - Declarations and injunctions sought - Easement held on trust - Registered proprietors of an interest in the easement - Misrepresentation or fraud - Restraint - Indefeasibility of title - Easement held on trust by Plaintiff for Defendant - Extinguished
Counsel:	Mr A. Philp for the Plaintiff Slorach

Mr M. Sumner-Potts for the Defendant Moutain View Farm Pty Ltd Mr M. Sumner-Potts for the Plaintiff Mountain View Farm Pty Ltd Mr A. Philp for the Defendant Sing

Solicitors:

MacDonnells for the Plaintiff Slorach

Thompson & Royds for the Defendant Moutain View Farm Pty Ltd Thompson & Royds for the Plaintiff Mountain View Farm Pty Ltd
MacDonnells for the Defendant Sing

Hearing dates:

20th May, 21st May, 29th May 1999.

IN THE SUPREME COURT

OF QUEENSLAND

CAIRNS	Writ No. 55 of 1998
BETWEEN:	HAFWEN MICHAEL SLORACH

First Plaintiff

AND:	CRAIG STEPHEN SING and JOANNE DAISY SING

Second Plaintiffs

AND:	MOUNTAIN VIEW FARM PTY LTD.

Defendant

REASONS FOR JUDGMENT

BEFORE THE HONOURABLE JUSTICE JONES

DELIVERED THE 17th DAY OF FEBRUARY, 2000

In this case the plaintiffs seek declarations and injunctions relating to their
respective claims to use an easement which burdened land contained in easement A
on Lot 100 on Registered Plan No. 749972. This land is owned by the defendant
corporation. Easement A was created by a grant dated 12 January 1990 [1] which is
couched in standard terms to permit “the grantees successors title ... tenants and all
authorised persons to pass or repass with or without motor vehicles for all purposes
connected with the use of the land”.
[1] Ex. 7
The defendant challenges the present existence of any such right and, further,
makes a cross application to have easement A extinguished or alternatively for a
declaration that the plaintiffs hold the rights to the easement on trust for the
defendant.
The first plaintiff is the registered owner of land described as Lot 2 on
Registered Plan No. 855876 County of Nares, Parish of Hull. The second plaintiffs
are the registered proprietors of the adjoining land, Lot 1, on the same registered
plan. The title search of the defendant’s land discloses that the easement burden is
for the benefit of Lot 2 only. The use of the easement by the second defendant
arises through their being lessees of Lot 2 or invitees of the first plaintiff.
Consequently no separate consideration of their rights needs to be undertaken. I
shall hereafter refer to the benefited land as “Lot 2”.
Easement A at present is the only formed access between the plaintiffs’
respective properties and Taggart Road which is the nearest public road. Although
Lot 1 has a 61 metre frontage to Taggart Road, that frontage is not presently
accessible because of the dense vegetation and the absence of crossings over the
watercourse, Big Maria Creek, and its tributaries which traverse near it.
At present, there is also no access for vehicles along easement A because the
bridge and culvert which previously forded Big Maria Creek have been effectively
removed.
The fording of Big Maria Creek presents special problems. The area around
the creek is low lying and is subject to flood and to erosion. It has been described
by an officer of the Department of Natural Resources (“DNR”) as being “ a very
sensitive hydrological environment”[2]. Any proposal for a crossing of the creek would require the approval of DNR which would, in the opinion of consulting
engineers who have furnished reports, undoubtedly require scour protection of the
banks at the cross point.
[2] Ex. 38
Without a suitable crossing the plaintiffs’ land could be cut off from the
public road for periods of 7 to 8 weeks during the wet season.
History
This litigation has its origins in the resolution of a claim for damages brought
in the District Court by a motorist who suffered injuries following the collapse of a
bridge which formerly crossed the creek within the alignment of easement A. At
that time the registered owner of Lot 2 was Mr. Lander Clifton and the registered
owner of the defendant’s land was Mr. George Wilson. In 1996, Mr. Wilson sold
his land to the defendant corporation which is the trustee of “The Wilson Family
Discretionary Trust”, of which the primary beneficiaries are Mr. Wilson’s wife and
their children.3
The third party proceedings in the damages claim was compromised between
these predecessors in the title on the basis that Mr. Clifton would surrender
easement A to Mr. Wilson at the expiration of 2 years from 14 November, 1995.4
The relevant terms were –
“NOW THIS DEED WITNESSES that in consideration of LANDER CLIFTON agreeing to surrender the said Easement A to GEORGE KEVIN WILSON at the expiration of two (2) years from the date of signing this Deed and the Surrender of Easement, GEORGE KEVIN WILSON will discontinue Third Party proceedings against LANDER CLIFTON in District Court Plaint No. 11 of 1994 and in Supreme Court Writ No. 56/94, Cairns District Registry with each party to meet their own legal costs.”
A Surrender of Easement in a form registrable at the Land Titles Office was executed by each of the parties on 14 November, 1995 but it was not lodged for registration in compliance with the agreement that it would take effect in 2 years
time. The solicitor acting for Mr. Wilson in respect of the preparation and
execution of that document was Mr. Ross Mangano of Tully who later acted for the
first plaintiff in his purchase from Mr. Clifton in 1966.
A new crossing over the creek was erected adjacent to the site of the
collapsed bridge but outside the area of the easement. This was an initial
makeshift temporary structure which was replaced by a more substantial bridge.
Mr. Wilson, and subsequently the defendant company, permitted Mr. Clifton and
the first plaintiff to deviate from the easement onto the defendant’s land in order to
access the new bridge until March 1998.
Easement B
In 1994 Mr. Clifton had subdivided his land to create Lots 1 and 2 and also
an easement burdening the new Lot 1 – the second plaintiffs’ land - in favour of
Lot 2 5. This easement is described on subsequent plans as easement B.
Essentially easement B is an 8 metre wide right-of-way parallel to the northern and
western boundary of Lot 1. On the northern boundary there is no road formation in
that easement area which is generally located within existing vegetation and
traverses a variable terrain of meandering creeks discharging into Big Maria Creek.
On the western boundary easement B includes the formed access to Lot 2 which
has been used in conjunction with easement A. There was no evidence as to why
easement B was created when it was and in particular whether it was intended at
this earlier stage as a replacement for easement A. Its creation did however result
in there being 2 registered easements benefiting Lot 2 for the purpose of providing
access to Taggart Road.

3 Ex. 10 4 Ex. 25

Purchase by First Plaintiff

It is common ground that, prior to entering into agreement for the purchase
of Lot 2 on 24 June 1996, the first plaintiff had a conversation with Mr. Clifton
concerning his right of access using easement A and proposals for the use of
easement B. On the first plaintiff’s recollection the conversation was to the effect
that a few days after an inspection of the property, Lander showed him on a plan
which depicted the alignments of easements and said –
“This is where the present road goes. The neighbour is going to be closing the road, and he has given us 2 years to construct a road on easement B. I’ll build that road for you for $7,000.00.” 6
In his affidavit and in cross-examination, the first plaintiff claimed he was unaware
of any easement over Lot 100 at the time of the contract and that it was not until he
spoke to Mr. Mangano after settlement that he became aware of that fact and of
details of the compromise of the District Court action. 7
According to Mr. Clifton, the conversation was to the effect that he told the
first plaintiff about his problem with the easement with Wilson, how he had been
drawn into a Court case and that he was “obligated to close easement A within a 2
year period.” 8 Understandably, Mr. Clifton was not sure of the precise terms of
the conversation but it was clear enough that the first plaintiff contracted on the
basis that his access through Lot 100 was to cease and he was to establish a new
access through easement B.

5 Ex. 9
6 Ex. 3 para 7
7 See transcript 67/5-40
8 Transcript 102/1

Also of significance is the evidence of Mr. Wilson, who on hearing that Mr.
Clifton was selling Lot 2, spoke to his solicitor, Mr. Mangano, to ensure the
Surrender of Easement would be effective against Mr. Clifton’s successors. [9]
[9] Ex 22 para 3
By this time, I infer that Mr. Mangano had been retained to act for the first
plaintiff in the purchase because of reference to “the building of a bridge and a
road”.[10] In December 1996, Mr. Wilson spoke to the first plaintiff about the
compromise agreement and the imminent expiry of his access across Lot 100. [11] A
discussion was had then, and subsequently, about the cost of constructing access
along easement B and the amount of retention from the purchase price. No
challenge was made to the evidence relating to these conversations. The purchase
by the first plaintiff was not settled until 22 January, 1997.
[10] Ex 22 para 4
[11] Ex 22 para 6
The contract of sale document (ex. 14) has annexed to it a plan and an
inventory of equipment. This plan shows quite clearly the alignment of easement
B and the points where easement A join Taggert Road and its relationship to Lot 2.
The contract was made conditional upon the registration of that plan. Although the
plan is not signed by the first plaintiff in the way the other attachments to the
contract document were, I infer that it was part of the document at the time the
contract was signed. Certainly no suggestion was made to the contrary. This is
consistent with the first plaintiff’s statement in his affidavit that he was shown a
plan by the Mr. Lander at the time of his first inspection. [12]
[12] Affidavit Slorach para 7
I do not accept the first plaintiff’s claim that he did not know what an
easement was and was unaware of easement A prior to the settlement of the
purchase. Access to the subject land which had no road frontage would have to have been a matter of immediate inquiry. The fact that the only access at the time
of inspection was different to the identified line of easement B would inevitably
have provoked further inquiry. I accept as accurate the evidence of Mr. Clifton
that he informed the first plaintiff of his obligation to close easement A within a
two year period.
The role of Mr. Mangano in these activities needs to be examined although
he was not called to give evidence and nor was any reference made to his files. In
relation to the Surrender of Easement document, he acted for Mr. Wilson and held
the document in escrow until the agreed date for lodgment. There does not seem to
me to be any reason why it could not have been stamped and lodged at that time
with some agreement for the permitted use being executed. Mr. Mangano was
clearly aware of the Surrender of Easement at the time he was retained by the first
plaintiff to act upon the sale.
The approach by Mr. Wilson to Mr. Mangano after this time must be seen on
the basis of Mangano acting on behalf of the first plaintiff. In Sargent v A.S.L.
Developments Ltd. [13] Mason J (as he then was) said:-
“The solicitor is to be regarded as the alter ego of the client and the rights of the other party to the contract cannot be made to depend upon the diligence or lack of diligence exhibited by the solicitor in his dealings with his client.”
I hold that Mr. Mangano’s remarks were uttered on behalf of the first plaintiff and
their consequences are to be judged accordingly.
[13] 1974 131 CLR 634 at p.659
The contract of sale itself included a special condition in the following
terms:-
“3. It is acknowledged that there is no practical access over easement B at this time and that the vendor does not have the funds to provide such practical access until he completes the sale of the property the subject of this contract. The vendor warrants that he will, within four (4) months from the date of completion of this contract provided [sic] at his cost creek crossings and roadway clearing, gravel on roadway where necessary to enable practical vehicle access along easement B. The parties agreed to a retention of $7,000 of purchase monies in the Purchaser’s solicitors trust account until access work is completed wherein the money shall be paid to the vendor.” [14]
This $7,000 retention was increased to $10,000 by written agreement on 15
August, 1996.[15] Settlement of the sale was to occur within 4 months of execution,
but in fact did not occur until January 1997.
[14] Ex. 14
[15] Ex. 15
Prior to settlement of the sale, Clifton did some tree felling towards the
development of a new access within the alignment of easement B. At this time no
approval had been sought from DNR in connection with any proposed crossings of
the watercourses. Clifton’s efforts apparently did not satisfy the first plaintiff and
both lost interest in constructing the new access way. The plaintiff said this was
because of his concern for the environment and the likely expense to be incurred.
Settlement of the conveyance from Clifton to the first plaintiff was effected
on 22 January, 1997. At settlement, the first plaintiff released Clifton of his
obligations to construct the access way along easement B and reduced the purchase
price for the land by $8,000. I can only infer that this reduction in price was on
account of the fact that access was not provided to Lot 2 as envisaged by the
contract of sale, and further that the first plaintiff intended to construct the road at
his own expense.
The whole of these circumstances lead me to conclude that at the time the
first plaintiff made this decision he was fully aware of the terms of the compromise
which obligated Clifton to surrender easement A and the fact that Clifton had
agreed to such surrender to take effect on 14 November 1997. I conclude further that at the time of settlement the first plaintiff had the intention to construct an
access way along easement B and an intention not to use easement A when this
was completed.
The change of mind
A short time after the settlement of the contract, the first plaintiff was asked
to sign a Surrender of Easement of easement A, which I assume was to replace the
document formerly signed by Mr. Clifton. He refused to do so on Mr. Mangano’s
advice which in the circumstances was somewhat surprising. I shall return in due
course to the effect of this decision not to sign Surrender of Easement.
This cessation of road building work by Clifton, the settlement of the sale
and the presentation of the surrender document to the first plaintiff appear to have
occurred within a short period of time. The precise date however of the first
plaintiffs’ refusal is not known. Exhibit 12 (the Transfer) shows that the document
was stamped on 6 February 1997 and was registered on 17 February 1997.
A few days after the first plaintiff’s refusal to sign the Surrender of Easement
document, he was approached directly by Mr. Wilson and asked why he didn’t sign
the document. Mr. Wilson then indicated that he would do whatever he could to
stop the first plaintiff using the easement.
Notwithstanding the first plaintiff’s refusal to sign the Surrender he remained
in contact with Mr. Wilson. In March, 1997 each assisted the other performing
tasks on their respective properties. There were discussions about what was
involved in building the proposed road across easement B. Mr. Wilson gave the
first plaintiff permission to continue to use his property until the proposed road in
easement B was completed.
From about June, 1997 requests were made to the first plaintiff by Mr.
Wilson not to use the road on the defendant’s property which was outside the
easement A alignment, but these requests were ignored.
The next incident of which evidence was adduced occurred on 12 September,
1997 when the defendant caused a letter to be sent to the first plaintiff advising that
the road was to be closed and seeking advice of the first plaintiff’s intentions about
building his own access road.[16]
[16] Ex. 16
At this time legal representatives of the parties engaged in correspondence
asserting, on behalf of their respective clients, the competing claims which fall to
be determined in these proceedings. It is not necessary to refer to this
correspondence. During this period a number of incidents also occurred which led
to allegations that survey pegs had been deliberately removed by Mr. Wilson.
These allegations were denied.
In March, 1998 a barricade was erected across the road used by the plaintiffs,
but which was outside the easement A alignment. A post and a mound of dirt was
also placed across the roadway at another point and the bridge which had been
erected across the creek outside the easement alignment was dealt with in such a
way as to make it unusable by vehicles. These confronting actions performed by
Mr. Wilson led to applications for injunctions to permit the plaintiffs’ access to the
properties. An interim injunction was granted on 20 July, 1998 and an
interlocutory injunction on 2 December, 1998.
On 4 December, 1998 the first plaintiff formally leased his property to the second plaintiffs who have continued to occupy both lots 1 and 2 since that time.The issues
The primary issue to be determined is whether the plaintiffs are entitled to
the beneficial use of easement A.
The basis upon which the first plaintiff asserts this entitlement is as
registered proprietors of an interest in easement A benefiting his land. He relies
particularly on the terms of s.184 of The Land Title Act 1994 (“the Act”). This
section provides as follows:-
184(1) A registered proprietor of an interest in a lot holds the interest subject to registered interests affecting the lot but free from all other interests.

(2) In particular, the registered proprietor –

(a) is not affected by actual or constructive notice of an unregistered interest affecting the lot; and
(b) is liable to a proceeding for possession of the lot or an interest in the lot only if the proceeding is brought by the registered proprietor of an interest affecting the lot.
(3) However, subsections (1) and (2) do not apply –

(a) to an interest mentioned in section 185 (Exceptions to s.184); or
(b) if there has been fraud by the registered proprietor, whether or not there has been fraud by a person from or through whom the registered proprietor has derived the registered interest.”

On behalf of the defendant company it is asserted that the conduct of the first
plaintiff in refusing to sign the Surrender of Easement in the circumstances which
prevailed amounted to fraud on his part for the purposes of s.184. The defendant
further asserts that the circumstances give rise to an interest referred to in s.185 of
the Act which operates as an exception to the provisions of s.184. In effect, the
defendant asserts that the first plaintiff holds the beneficial interest in easement A
on trust for the defendant corporation. Reliance is placed on s.185(1) of the Act
which relevantly provides –
“185.(1) A registered proprietor of a lot does not obtain the benefit of section 184 (Quality of registered interests) for the following interests in relation to the lot –
(a) an equity arising from the act of the registered proprietor;

...
(g) the interest of another registered proprietor of the lot described in the indefeasible title wrongly includes land in which the other registered proprietor has an interest.”

There are ancillary matters of relief such as injunctions and damages, the
entitlement to which depends on the determination of this principal issue. The
defendant also seeks, in the alternative, the extinguishment of easement A pursuant
to s.181 of the Property Law Act (“PLA”).
The law
It is clear enough that Mr. Wilson and the defendant had against Mr. Clifton
the right to have the Surrender of Easement A enforced. In fact there was no
reason why the document could not have been lodged or some other means
adopted for protecting this benefit to the land which was subsequently transferred
to the defendant. In any event both Mr. Wilson and the defendant were entitled to
have the Surrender specifically performed by Mr. Clifton.
The first plaintiff, as I have found, was aware that Mr. Clifton and the
defendant had agreed that the right of way over the defendant’s land was to be
extinguished and would not be available to him. He purchased the subject land on
that basis and paid a reduced price to compensate for having to provide alternative
access. The first plaintiff approached the settlement of the sale on the basis that he
would not seek to use easement A after the surrender date. The first plaintiff’s
intention to provide alternative access was communicated to the defendant by the
plaintiff’s solicitors. The defendant was entitled thereupon to assume that its benefit from the surrender of the easement would not be defeated by the
registration of the transfer to the first plaintiff. Although not stated in express
terms, the clear inference is that, had it been disclosed, that effect would not have
been given to the surrender and he would have taken steps to enforce the
agreement. I find that the defendant relied upon these representations.
Even though the representations of the first plaintiff and his solicitor were
true at the time, the subsequent change of intention constitutes a misrepresentation.
Whether this amounts to fraud in the common law sense is not a matter that I need
to determine in the view I have taken of the case. This is not a case where the first
plaintiff merely had notice of the defendant’s right to have the surrender of the
easement. It is the first plaintiff’s positive assertion to the defendant’s inquiry that
he intended to act so as to recognise the defendant’s interest that makes the
difference.
In Bahr v Nicolay [17] the point was made by Mason CJ and Dawson J as
[17] (1987-8) 164 CLR 604 at p.68
follows:-
“Sections 68 and 134 [the equivalents to ss.184, 185 here] give
expression to, and at the same time qualify, the principle of
indefeasibility of title which is the foundation of the Torrens system of
title:
...
Neither the two sections nor the principle of indefeasibility precludes a
claim to an estate or interest in land against a registered proprietor arising
out of the acts of the registered proprietor himself: Breskvar v Wall.
Thus, an equity against a registered proprietor arising out of a transaction
taking place after he became registered as proprietor may be enforced
against him: Barry v Heider. So also with an equity arising from conduct
of the registered proprietor before registration (Logue v Shoalhaven Shire
Council), so long as the recognition and enforcement of that equity
involves no conflict with ss. 68 and 134. Provided that this qualification
is observed, the recognition and enforcement of such an equity is
consistent with the principle of indefeasibility and the protection which it
gives to those who deal with the registered proprietor on the faith of the
register.”
And further at p.615-6 said:-
“In the context of s.68 there is no difference between the false undertaking which induced the execution of the transfer in Loke Yew and an undertaking honestly given which induces the execution of a transfer and is subsequently repudiated for the purpose of defeating the prior interest. The repudiation is fraudulent because it has as its object the destruction of the unregistered interest notwithstanding that the preservation of the unregistered interest was the foundation or assumption underlying the execution of the transfer. For the same reason the subsequent repudiation by a transferee of property of a limited beneficial interest in that property is fraudulent, when the transferee took the property on terms that the limited beneficial interest would be retained by the transferor. It is immaterial that the transferee “may have been innocent of any fraudulent intent in taking the conveyance in absolute form”: Bannister v Bannister.”
In the same case Brennan J (as he then was) said:-
“However, the title of a purchaser who not only has notice of an antecedent unregistered interest but who purchases on terms that he will be bound by the unregistered interest is subject to that interest. Equity will compel him to perform his obligation.
...
A registered proprietor who has undertaken that his transfer should be subject to an unregistered interest and who repudiates the unregistered interest when his transfer is registered is, in equity’s eye, acting fraudulently and he may be compelled to honour the unregistered interest. A means by which equity prevents the fraud is by imposing a constructive trust on the purchaser when he repudiates the unregistered interest.” [18]
[18] Ibid at p.653-4
In my view the first plaintiff’s actions constitute a “fraud which is recognised
in equity.” Discussion of the nature of equitable jurisdiction to deal with such
fraud is contained in “Equity – Doctrines and Remedies” (3rd ed.) Meagher,
Gummow and Lehane at paras [1207]-[1210]. Particularly at para [1210] a number
of examples of fraud are listed of which subparagraph (d) seems apt:-
“Improper reliance upon legal rights, with particular reference to...the use of statutory defences where the relations and dealings between the parties make it unconscionable to press the statute.”
The first plaintiff’s reliance now on s.184 of the Act, in an attempt to defeat
the defendant taking the benefit of the surrender, would fall within that class of
fraud. Taking this view, by virtue of subsection 3(b) the first plaintiff is denied the
benefit of the section.
It seems to me also that, quite apart from fraud, equity would enforce the
recognition by the first plaintiff of the surrender of easement A as being a restraint
touching his use of Lot 2. The surrender of easement A is in effect the removal of
a benefit on the use of Lot 2 – effectively a restraint now attaching to the use of
that land. The covenantor, Mr. Clifton, was of course personally bound by his
agreement to surrender. But his undertaking was in respect of the use of land. The
question is whether equity, consistent with settled doctrines, could refuse to impose
the restraint on a successor to the land who takes with notice of the restraint and
with, as I have found, the initial intention of complying with that restraint.
A similar question arose in Forestview Nominees Pty Limited v Perpetual
Trustees (WA) Limited [19]. In that case the High Court had to deal with a question
of the passing of the benefit of a restrictive covenant preventing the use of land
adjacent to a shopping centre from use for retail and other sales. The point at issue
was whether the express agreement, that the restraint would enure for the benefit of
successors in title and not for the benefit of any tenant, could be enforced. In the
course of examining the nature of such restrictive covenants, the Court (Gaudron,
McHugh, Gummow, Kirby and Hayne JJ) said:-
“At common law, save as between landlord and tenant, where special rules apply, the burden of covenants did not run with the covenator’s land. In some circumstances, the benefit might run with the land but, in particular, when the covenant was taken, the covenantee was required to have an estate in the land to which the covenant was intended to attach. A successor of the covenantee could not enforce the covenant unless that party held the same estate in that land or in some portion of that land. Hence the statement that whilst the phrase “runs with the land” was devised by the common law, “the benefit of a covenant runs at law not with the land but with the covenantee’s estate in the land”.”
...
... [I]n dealing with the passing of the benefit of restrictive covenants, equity did not act upon any close analogy with the common law. Rather, it had regard to the intention of the parties creating the covenant and did not regard objections drawn from common law doctrine necessarily as sufficient to defeat that intention where it was clear.”[20]
[19] (1998) 193 CLR 154
[20] Ibid at pp 167-8
In Forestview the Court went on further to observe (at p.169) as follows:-
“Again, in equity where a restrictive covenant is taken by a freeholder in favour of that person and the assigns of any person deriving title under that party, the covenant later may be enforced by a lessee despite the absence of privity of estate between the lessee and the predecessor in title. Here also effect is given to the intention of the parties to the covenant by denying the analogy of the common law rules which would have fixed upon the absence of privity of estate. Rather, the parties to the covenant must have manifested therein an intention that the benefit of the covenant does runs with the land concerned”.
It is clear to me that the burden of the restraint on Clifton’s use of the land
was an equity intended to run with the land and that equity therefore did not
require privity in the agreement to be shown. The key element is “the intention of
the parties”. [21] The covenant should be enforced in this case. As I have found, the
first plaintiff had the intention to be bound by the surrender throughout the period
between the signing of the contract and the settlement and indeed for a short time
thereafter. That intent was confirmed to the defendant both by the first plaintiff
and his solicitor.
[21] Ibid at p.169 para 30
Following this approach, the first plaintiff’s title for which he asserts indefeasibility includes land in which the defendant as registered proprietor of Lot 100 has an interest. This is recognised as an exception to the indefeasibility
provision by s.185(1)(g) of the Act. Accordingly, the first defendant cannot claim
indefeasibility in respect of the title which it seeks now to assert.
Outcome in this case
By whatever route the matter is approached, it leads to the consequence that
the first plaintiff should not continue to have the benefit of easement A. My finding
of equitable fraud in the circumstances would lead to me to declare that the first
plaintiff holds the beneficial interest in easement A on trust for the defendant.
In the context of the other applications made by the defendant, I would
therefore order that the said easement be extinguished. Further, as s.187 of the Act
applies, consequential orders that the respective titles to Lot 100 on RP 846540 and
Lot 2 on RP 855876 be corrected by giving effect to the Surrender of Easement
executed on 14 November 1995 would be appropriate.
By reason of my decision, it is unnecessary for me to consider further the
application made by the defendant pursuant to s.181 of the PLA for the
extinguishment of the easement on the discretionary grounds set out in that section
and the first plaintiff’s application for compensation.
The defendant also seeks an injunction restraining the first plaintiff, his
tenants, servants, agents, indentees, licensees or permitees from crossing the said
Lot 100. This is relief to which he is prima facie entitled but in respect of which I
have to recognise the fact that there is no means of access to the first plaintiff’s
property apart from the access way which is in the main included in the alignment
of easement A. The exercise of my discretion to grant the injunction must
therefore be tempered by the necessity for the first plaintiff and other lawful
entrants to have access to his property whilst he is given the opportunity to construct alternative access. I would therefore condition the granting of the
injunction upon the defendant giving an undertaking to permit the first plaintiff and
the second plaintiffs and other lawful entrants access to Lots 1 and 2 along the
access way constituted partly by the former easement A and partly across Lot 100
for a period of time to be determined after further submissions.
Damages
The first plaintiff and the second plaintiffs, on the one hand, and the
defendants, on the other hand, each claim damages against the other for nuisance
and trespass.
The plaintiffs argued that even if the easement issue goes against their
interest they were entitled to use the access way until its extinguishment. They
assert that the denial by the defendant of their exercise of this right has caused
serious loss to them.
For the first plaintiff, he was unable to use the land effectively and
consequently has not sought to use the land since May 1998. However, from 1
November 1998 the first plaintiff formally leased his land to the second plaintiffs
for a period of 12 months, and covenanted that they “shall hold and enjoy the
demised land pursuant to the lease without eviction or disturbance from the
lessor”.[22] It is seen, therefore, that any claim for damages would be for a short
period and of relatively small compass. The matter is further complicated because
the area of contention – the bridge crossing Big Maria Creek – is not on easement
land. The first plaintiff cannot assert any right to use that crossing but such use as
was made of it was a matter of grace and favour from the defendant. Allegations
and counter allegations have been raised about the safety of that bridge and the cause of its destruction. I do not propose to consider the relative weight of these
allegations which were mainly raised in the affidavits and not pursued particularly
in oral evidence at the hearing.
[22] Para 20 ex. 13
The second plaintiffs used Lot 2 initially at the invitation of the first plaintiff
and then formally pursuant to the said lease. The purpose of their entering into
these arrangements with the first plaintiff was to ensure access to their own
property, Lot 1 on RP 855876. This is the allotment which I mentioned earlier and
has a frontage to Taggart Road but no formal access. In terms of a claim for
damages, the second plaintiffs are in a worse position than the first plaintiff is
because they agreed to occupy the premises in the full knowledge of the
restrictions that had been placed upon the access way by the actions of Mr. Wilson.
They, like the plaintiff, had no right to the use of Lot 100 apart from the contested
right to use the easement. Again for them also the crossing point of Big Maria
Creek was on the defendant’s land which they accessed with his permission.
I have no doubt there has been considerable inconvenience put in the path of
the plaintiffs’ use of the access way and consequently of their respective land
holdings. There has also been considerable levels of bitterness and ill will between
the parties. As I have found that the circumstances have been brought out by
equitable fraud on the part of the first defendant it is not appropriate to award
damages.
The quantification of damages has been suggested only in the most general
terms and relies in the main on material set out in affidavits rather than oral
testimony. Conscious that I enjoy no special position in making the assessment, I
propose not to do so.
The defendant seeks damages for trespass and nuisance, including exemplary
damages and/or aggravated damages. This claim appears to be based on some
general allegations about excessive use of the access way by motorcycles and
motor vehicles which had the effect of forcing the defendant’s tenant to leave the
premises. There are allegations also about the second plaintiffs and their guests
enjoying the use of a swimming hole in the creek which was on the defendant’s
property and outside the easement alignment. Other than that, the use by the
plaintiffs of the access way and of a part of Lot 100 which was necessary to ford
the creek was done with the defendant’s permission and there is no allegation that
there was any abuse of that privilege which led to any loss or damage on the part of
the defendant.
In the end result I find that the allegations upon which the claim for damages
is based are too generalised and their association with any formal loss to the
defendants has been too nebulous to sound in damages. Again these claims having
been raised in the affidavit material were not particularly pursued in the oral
evidence before me. I dismiss the respective claims of each party for damages.
Orders
My orders are:-

9. That it be declared that the easement over the land described as Easement
A in Lot 100 on Registered Plan Number 846540, County of Nares,
Parish of Hull is held on trust by the Plaintiff for the Defendant.

10. That the said Easement be extinguished.
11. That the register be amended accordingly.
12. That the First Plaintiff pay the Defendant’s costs of and incidental to this
action including reserved costs to be taxed.
13. That the Second Plaintiffs be jointly and severally liable for costs as from
the date when the Second Plaintiffs became a party to the action and from
that date pay the Defendant’s costs of and incidental to the action to be
taxed.
14. That note is taken of the undertaking to the Court given by the First
Defendant that up to and including the 30th June 2000 it will not, whether
by itself or its servants or agents or otherwise howsoever obstruct or
interfere with:-
(b)           Vehicular access to the land described as Lot 2 on
Registered Plan Number 749972, County of Nares,
Parish of Hull over and along:-
(iii)          The land described as Easement A in Lot 100 on
Registered Plan Number 846540, County of Nares,
Parish of Hull; and
(iv)          Any further part of Lot 100 on Registered Plan Number
846540 as may be reasonably necessary for vehicular
traffic to deviate from the alignment of the said

Easement to and from the existing bridge across Big
Maria Creek.

15. That the Plaintiff’s claim in this action be dismissed.
16. That the parties have liberty to apply on 24 hour’s notice.

...
(g)	the interest of another registered proprietor of the lot described in the indefeasible title wrongly includes land in which the other registered proprietor has an interest.”

[2000] QSC 69

17/02/2000