Trevlind v BMP Manufacturing

[2008] NSWSC 603

CITATION:	Trevlind v BMP Manufacturing [2008] NSWSC 603
HEARING DATE(S):	2 May 2008
JUDGMENT DATE :	19 June 2008
JURISDICTION:	Equity
JUDGMENT OF:	White J
DECISION:	See paras 47-48 of judgment.
CATCHWORDS:	LOCAL GOVERNMENT – works – ownership of drainage works – whether council installed works – Council did not provide labour, funds or supervision – drainage works not installed by council - REAL PROPERTY – easements – easements in gross – easement in gross can be created pursuant to ss 88B(2)(a) and (3)(a) Conveyancing Act – whether an easement created appurtenant to an existing public road was an easement in gross – easement to be construed in context – instrument setting out the terms of the easement specified lots and a public road to be benefited – Council not named as a body to be benefited – not an easement in gross - REAL PROPERTY – easements – whether easement is ‘land’ that is ‘held’ in context of s 51 Local Government Act – land held for drainage purposes may be used for other purposes not inconsistent with its use for drainage purposes – ‘Land’ refers to physical land in this context – ‘To hold’ requires more than an entitlement to use land for drainage purposes in this context
LEGISLATION CITED:	Conveyancing Act 1919 (NSW) Local Government Act 1993 (NSW) Local Government and Conveyancing (Amendment) Act 1964 (NSW) Interpretation Act 1987 (NSW)
CATEGORY:	Principal judgment
CASES CITED:	Bonaccorso v Strathfield Municipal Council [2003] NSWSC 408 Commissioner for Main Roads v BP Australia Ltd (1964) 82 WN (Pt 2) (NSW) 27 Bonvale Enterprises Pty Ltd v Halpenny Investments Pty Ltd (2005) 62 NSWLR 698 Westfield Management Ltd v Perpetual Trustee Co Ltd [2007] HCA 45; (2007) 239 ALR 75; 81 ALJR 1887 Sertari Pty Ltd v Nirimba Developments Pty Ltd [2007] NSWCA 324 North Sydney Council v Ligon 302 Pty Ltd (1996) 185 CLR 470
TEXTS CITED:	R A Woodman, The Law of Real Property in New South Wales, (1980) Vol 1, The Law Book Company Ltd Woodman and Nettle: The Torrens System in New South Wales, 2nd ed (2003) Thomson Lawbook Co
PARTIES:	Trevlind Pty Ltd & 2 Ors v BMP Manufacturing Pty Ltd
FILE NUMBER(S):	SC 1891/07
COUNSEL:	Plaintiffs/cross-defendant: R I Bellamy Defendant/1st cross-claimant: T Robertson & N Newton 2nd cross-defendant: J E Lazarus
SOLICITORS:	Plaintiffs/cross-defendant: Aubrey Brown Partners Defendant/1st cross-claimant: Conditsis & Associates 2nd cross-defendant: Home Wilkinson Lowry

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

WHITE J

Thursday, 19 June 2008

1891/07 Trevlind Pty Ltd & 2 Ors v BMP Manufacturing Pty Ltd

JUDGMENT

1 HIS HONOUR: The plaintiffs and the defendant own adjoining blocks of land within an industrial area in the Local Government Area of Wyong.

2 The issue in this proceeding is whether the Wyong Shire Council can authorise the defendant to drain water from the defendant’s land through an easement to drain water given by the plaintiffs over their land to the Council pursuant to s 88B(2)(a) and (3)(a) of the Conveyancing Act 1919 (NSW). The plaintiffs say it cannot, because the easement is appurtenant to, and was given only for the benefit of, a public road owned by the Council; whereas the proposed use would be solely for the benefit of the defendant’s land, not the road. The defendant and the Council say that the easement vested in the Council pursuant to s 88B(3)(a) is an easement in gross, that is, it is an easement without a dominant tenement, and on the literal words of the easement every person authorised by the Council may use the easement to drain water, irrespective of the land thereby benefited.

3 The plaintiffs say that such an easement in gross could be created pursuant to s 88A of the Conveyancing Act, but the easement was not created under s 88A. The plaintiffs say that such an easement could not be created under s 88B(3)(a) of the Conveyancing Act. The plaintiffs also say that even if an easement in gross could be created under s 88B(3)(a), the easement is not of that kind.

4 The defendant and the Council also rely upon ss 51 and 59A of the Local Government Act 1993 (NSW) as entitling the Council to authorise the defendant to use the easement for the purposes of draining water from the defendant’s land through the drain constructed along the easement.

Background

5 On 12 November 1992, the Council granted its consent to a development application by the first plaintiff, Trevlind Pty Ltd (“Trevlind”), for the subdivision of lot 112 of DP 615529 into six lots and one residue lot. The plan of subdivision became DP 841170. On 28 June 1993, the Council approved the carrying out of filling on the subject land. It was a condition of the development consent that Trevlind submit and implement a satisfactory stormwater drainage proposal which included the provision of necessary easements for drainage within the property, and through other properties, for drainage works to be completed at no cost to the Council, and for necessary easements for drainage to be submitted to the Council and registered. The six lots of the subdivision abut a public road, Mildon Road, as shown on the plan of subdivision of lot 112 of DP 615529 reproduced below. The easement lies along the eastern boundary of lots 3 and 7 as shown by the dotted line.

6 The defendant’s land lies to the north of Tindal Road as shown on the above plan. The western boundary of the defendant’s land adjoins the eastern boundary of the plaintiffs’ land. The plan of subdivision stated that pursuant to s 88B of the Conveyancing Act it was intended to create, inter alia, an easement to drain water 3 wide, 8 wide and variable. The instrument setting out the terms of the easements intended to be created pursuant to s 88B stated as follows:

1. Identity of Easement or restriction firstly referred to in abovementioned plan	Easement to drain water 3 wide, 6 wide [sic] and variable
SCHEDULE OF LOTS ETC. AFFECTED
Lots burdened	Lots, name of road or authority benefited
3	1, 2, 4, 5, 6 and Mildon Road
7	1, 2, 3, 4, 5, 6 and Mildon Road
... 1. Terms of Easement to drain water [...] referred to in the abovementioned plan.
An easement to drain water within the meaning of Part III of Schedule VIII to the Conveyancing Act, 1919

7 Pursuant to s 181A(1A) of the Conveyancing Act, this instrument created an easement in the following terms:

“Part 3 Easement to drain water

Full and free right for every person who is at any time entitled to an estate or interest in possession in the land herein indicated as the dominant tenement or any part thereof with which the right shall be capable of enjoyment, and every person authorised by that person, from time to time and at all times to drain water (whether rain, storm, spring, soakage, or seepage water) in any quantities across and through the land herein indicated as the servient tenement, together with the right to use, for the purposes of the easement, any line of pipes already laid within the servient tenement for the purpose of draining water or any pipe or pipes in replacement or in substitution therefor and where no such line of pipes exists, to lay, place and maintain a line of pipes of sufficient internal diameter beneath or upon the surface of the servient tenement, and together with the right for the grantee and every person authorised by the grantee, with any tools, implements, or machinery, necessary for the purpose, to enter upon the servient tenement and to remain there for any reasonable time for the purpose of laying, inspecting, cleansing, repairing, maintaining, or renewing such pipe line or any part thereof and for any of the aforesaid purposes to open the soil of the servient tenement to such extent as may be necessary provided that the grantee and the persons authorised by the grantee will take all reasonable precautions to ensure as little disturbance as possible to the surface of the servient tenement and will restore that surface as nearly as practicable to its original condition. ”

8 Trevlind engaged a contractor to construct drainage works within the area of the easement. The drainage works were constructed in approximately August 1993 from concrete, earth and turf. They run for the length of the easement and consist of a concrete dish drain, earth batters and an earth bank mound. The easement runs in a northerly direction from Mildon Road through the plaintiffs’ burdened lots to a drainage reserve which was dedicated to the Council by Trevlind.

9 The defendant and the Council contend that pursuant to s 59A of the Local Government Act the Council is the owner of the drainage works installed on the plaintiffs’ land. Section 59A provides:

“ 59A Ownership of water supply, sewerage and stormwater drainage works

(1) Subject to this Division, a council is the owner of all works of water supply, sewerage and stormwater drainage installed in or on land by the council (whether or not the land is owned by the council).
(2) A council may operate, repair, replace, maintain, remove, extend, expand, connect, disconnect, improve or do any other things that are necessary or appropriate to any of its works to ensure that, in the opinion of the council, the works are used in an efficient manner for the purposes for which the works were installed. ”

10 It was common ground that the cost of the drainage works was borne by Trevlind and that the contractor who installed the works was engaged by Trevlind. The works were required to comply with Council’s specifications. It was submitted that the Council would have supervised the construction of the works to ensure that its specifications were complied with. The construction of the drainage works along the easement was a requirement of Council. The drain takes water from Mildon Road, which is a public road vested in the Council. The defendant and the Council say that by reason of these matters the Council installed those works, and therefore owns the drainage works.

11 Lot 7 of DP 841170 was subdivided in 1998 by plan of subdivision DP 877668. It created a new road (Morton Close), and seven lots; six of them abutting on the opened road and the seventh lying further to the north. In connection with this subdivision further easements to drain water were created. One easement to drain water 1.5 metres wide identified each of the lots in the subdivision which were burdened and the lots in the subdivision or in DP 841170 which were benefited. The other easement to drain water 3 metres wide burdened lot 4 in the subdivision and was expressed to be for the benefit of Wyong Shire Council. Both easements were said to be easements within the meaning of Pt 3 of Sch 8 to the Conveyancing Act.

12 The defendant is the owner of land lying immediately to the east of the plaintiffs’ land on the opposite side of the drainage works. Its land does not abut Mildon Road. There is access to its land from Mildon Road through Tindall Road. On or about 30 August 2006, the Wyong Shire Council granted development approval for certain filling and drainage works on the defendant’s land. A condition of Council’s approval was:

“ The construction of a piped and open drainage system to collect stormwater generated from the existing workshop building, filled area and car park. The system shall connect into Council’s existing concrete lined system along the western boundary. ... ”

13 The defendant appealed to the Land and Environment Court, although not, as I understand it, in relation to the imposition of conditions of consent concerning drainage. The appeal was upheld. The Land and Environment Court determined the defendant’s application by the granting of development consent subject to conditions. The relevant condition requiring the construction of a stormwater drainage system on the defendant’s land to connect to the drain within the easement was not changed.

14 The plaintiffs say that the drainage works do not belong to the Council and the easement Trevlind gave does not extend to the drainage of stormwater from the defendant’s land. The defendant and the Council say that the conditions of the development consent are such that the defendant is authorised by the Council to drain water from its land into the drainage works constructed on the easement, and that such a use is authorised by the easement.

15 On 20 June 2007, Trevlind transferred its land to the second and third plaintiffs who are associated with Trevlind.

16 The plaintiffs claim a declaration that the defendant is not entitled to construct a stormwater drainage system that connects to the system on the plaintiffs’ land and is not entitled to enter the plaintiffs’ land for that purpose. They seek an injunction to restrain the connection of any drainage system from the defendant’s land to the drainage works on the easement. The plaintiffs allege that works already constructed on the defendant’s land create a nuisance. The defendant brings a cross-claim. The defendant also makes claims in nuisance and trespass. Common to both proceedings are questions as to the scope of the rights given to the Council by the easement, and in particular, whether the Council can authorise the defendant to drain stormwater from the defendant’s land into the easement. Questions also arise under the Local Government Act. By consent I directed that certain questions be determined in advance of other issues in the proceedings, namely:

“1. Is Wyong Shire Council the owner of the drainage works situated within the Existing Easement on Trevlind’s land pursuant to section 59A of the Local Government Act 1993 (NSW)?

2. If the answer to the previous question is yes; does that constitute a lawful basis for Wyong Shire Council to authorise BMP Manufacturing’s officers, employees and agents to enter upon the Existing Easement, bring equipment upon the Existing Easement, undertake works upon the Existing Easement as contemplated in the Development Consent and connect to the drainage works and to drain water from BMP Manufacturing’s land to the drainage works within the Existing Easement?

3. If the answer to the previous question is yes; does the Development Consent, properly construed, constitute a lawful authorisation granted to BMP Manufacturing by Wyong Council for officers employees and agents of BMP Manufacturing to enter upon the Existing Easement, bring equipment upon the Existing Easement, undertake works upon the Existing Easement as contemplated in the Development Consent, and connect to the drainage works within the Existing Easement and to drain water from BMP Manufacturing’s land to the drainage works as contemplated in the Development Consent?

4. Does the Existing Easement properly construed, constitute a lawful basis for Wyong Shire Council to authorise BMP Manufacturing’s officers, employees and agents to enter upon the Existing Easement, bring equipment upon the Existing Easement, undertake works upon the Existing Easement, connect to the drainage works and to drain water from BMP Manufacturing’s land to the drainage works within the Existing Easement as contemplated in the Development Consent?

5. If the answer to the previous question is yes; does the Development Consent, properly construed, constitute a lawful authorisation granted to BMP Manufacturing by Wyong Council for officers employees and agents of BMP Manufacturing to enter upon the Existing Easement, bring equipment upon the Existing Easement, undertake works upon the Existing Easement as contemplated in the Development Consent, and connect to the drainage works within the Existing Easement and to drain water from BMP Manufacturing’s land to the drainage works as contemplated in the Development Consent?

6. Alternatively, does the Existing Easement properly construed, constitute a lawful basis for Wyong Shire Council to drain water from the Proposed 88A Easement into the drainage works within the Existing Easement?

7. Whether the defendant can be authorised by the Council to drain water from its land to, across and through the Existing Easement pursuant to s 51 of the Local Government Act 1993

In these separate questions:

Trevlind means the plaintiff/first cross-defendant.

Trevlind’s land means the land comprised in Certificate of Title Folio Identifier 4/877668.

BMP Manufacturing means the defendant/cross-claimant.

BMP Manufacturing’s land means land situated at 127 Pacific Highway Wyong and comprised in Certificate of Title Folio Identifier 51/1040296.

Wyong Shire Council means the fourth cross-defendant.

Development Consent means the Development Application Determination dated 30 August 2006 addressed to Everitt & Everitt Consulting Surveyors and the Orders made on 19 February 2008 by the Land and Environment Court in Proceedings No. 10835 of 2007.

Drainage Works means the works contained within the Easement and running the length of the Easement. They consist of a concrete dish drain, earth batters and an earth bank mound. The part of the drainage works the subject of these proceedings are shown in the plans of Everitt & Everitt Consulting Surveyors, Sheets 1-4, Reference 16291, dated 27 April 2007. The drainage works are also shown in other plans as:-

§ The ‘Proposed Open Drain’ and ‘Concrete Dish’ shown in Bundick & Ranson’s Layout & Catchment Plan Sheet 1 of 12, approved development plan for Development Consent No. 220 of 1991 dated 12 November 1992; and

§ The ‘Open Drain’ shown in the approved development plan for Development Consent No. 428 of 1993 dated 28 June 1993.

Existing Easement means the easement to drain water 3 metres wide, 8 metres wide and variable benefiting Wyong Shire Council and burdening Trevlind’s land and created by the registration of Deposited Plan 841170.

Proposed 88A Easement means the proposed easement to drain water to be created by BMP Manufacturing in favour of Wyong Shire Council pursuant to section 88A of the Conveyancing Act 1919 on BMP Manufacturing’s land to satisfy Condition 14 of the Development Consent. ”

Were the Drainage Works Installed by the Council?

17 The defendant submitted that Trevlind’s contractor constructed the drainage works at the direction of the Council and pursuant to the conditions of Council’s development application. The relevant conditions were:

“ 5. The submission of a satisfactory stormwater drainage proposal, including the provision of necessary easements for drainage within the property and through other properties where necessary, prior to issue of the building permit. Drainage works to be completed at no cost to Council prior to occupation of the development.
6. Suitable silt and nutrient control measures to be provided at the outlets of the piped drainage system to prevent pollutants entering the wetlands area/drainage course. All works to be in accordance with Council’s Engineering Requirements for Development and are to be contained wholly within residual Lot 7.
7. The submission to Council and subsequent registration of the necessary easement for services and drainage.
...
17. The prevention of the obstruction of surface drainage, the disruption of amenity, damage or deterioration in regard to other any other property.
18. The developer being responsible for any costs relating to alterations and extensions of existing roads, drainage and Council services for the purposes of the development.
19. The design and construction of all subdivision works in accordance with Council’s Engineering Requirements for Development.”

18 It can be taken that the works were carried out in accordance with the Council’s engineering requirements for the development as expressed in the development consent, but the evidence is silent as to the degree, if any, of Council’s on-site supervision of the works.

19 The defendant relied upon the decision of Young CJ in Eq in Bonaccorso v Strathfield Municipal Council [2003] NSWSC 408 where his Honour said (at [39]) that “The concatenation of verbs used in s 59A(2) leans very strongly in favour of the view that s 59A should be construed widely”. His Honour noted that the clear purpose of s 59A was to empower a council to enter premises to replace and repair drainage works without having to purchase an easement (at [35]).

20 In that case, in 1939 a landowner had made arrangements with the Council for the laying of pipes through her land. The Council paid a subsidy towards the cost of laying the pipes. The works enabled the Council to drain stormwater through the pipes, and enabled the landowner to obtain approval for plans for the erection of buildings above the pipes. The Council supplied the labour and bore two-thirds of the cost of the work. The construction of the pipe was supervised by a company specialising in that work. The claim arose because there was no easement in respect of the pipe and a subsequent purchaser of the land sought a declaration that the discharge of stormwater through the pipe constituted a trespass and a nuisance. Young CJ in Eq held that s 59A applied to installations carried out by a council before the section came into effect and that the Council had “installed” the pipe. Hence it was the owner of the pipe and was entitled pursuant to s 59A(2) to operate, maintain and improve the pipe. This extended to keeping the pipe in situ and passing a reasonable amount of stormwater through it (at [46]). In finding that the Council had “installed” the pipe, his Honour placed particular reliance on the fact that it was the Council which provided the labour for the physical act of laying the pipe in position, in other words, that the laying of the pipe was done by the Council through its employees (at [39]). His Honour noted (at [37]) that “installation” primarily refers to the placing of something in position and not the supply of the thing. Ownership of the materials (prior to their installation as drainage works) did not determine by whom the works were installed.

21 There are substantial differences in the facts between the present case and the facts in Bonaccorso v Strathfield Municipal Council. Unlike that case, here the Council did not provide the labour for the laying out of the drainage works. Nor did it pay for or contribute to the payment for those works. Nor, so far as the evidence discloses, did it supervise the carrying out of the works. It specified conditions with which Trevlind was required to comply. Neither the fact that the drainage works were for the Council’s benefit, in that the works drained water from the Council’s road, nor the fact that Council laid down its requirements for the works, nor those matters in combination, mean that the Council installed the works. The works were installed by Trevlind who caused them to be built and paid for their installation, or else by Trevlind’s contractor who supplied the labour and materials.

22 Accordingly, I will answer the first question, no. The second question does not arise.

The Easement

23 Sections 88, 88A and 88B of the Conveyancing Act provide:

“ 88 Requirements for easements and restrictions on use of land

(1) Except to the extent that this Division otherwise provides, an easement expressed to be created by an instrument coming into operation after the commencement of the Conveyancing (Amendment) Act 1930, and a restriction arising under covenant or otherwise as to the user of any land the benefit of which is intended to be annexed to other land, contained in an instrument coming into operation after such commencement, shall not be enforceable against a person interested in the land claimed to be subject to the easement or restriction, and not being a party to its creation unless the instrument clearly indicates:
(a) the land to which the benefit of the easement or restriction is appurtenant,
(b) the land which is subject to the burden of the easement or restriction:
Provided that it shall not be necessary to indicate the sites of easements intended to be created in respect of existing tunnels, pipes, conduits, wires, or other similar objects which are underground or which are within or beneath an existing building otherwise than by indicating on a plan of the land traversed by the easement the approximate position of such easement,
(c) the persons (if any) having the right to release, vary, or modify the restriction, other than the persons having, in the absence of agreement to the contrary, the right by law to release, vary, or modify the restriction, and
(d) the persons (if any) whose consent to a release, variation, or modification of the easement or restriction is stipulated for.
(1A) Land (including the site of an easement) is clearly indicated for the purposes of this section if it is shown:
(a) in the manner prescribed by regulations made under this Act or the Real Property Act 1900, or
(b) in any other manner satisfactory to the Registrar-General in the particular case or class of cases concerned.

This subsection does not limit other ways in which land may be clearly indicated.

(2) This section shall not prevent the enforcement by a person entitled to a reversion remainder or other future estate or interest in any land of any contract against a person entitled to the estate or interest on which the reversion remainder or other future estate or interest is expectant.
(3) This section applies to land under the provisions of the Real Property Act 1900, and in respect thereof:
(a) the Registrar-General shall have, and shall be deemed always to have had, power to record a restriction referred to in subsection (1), in such manner as the Registrar-General considers appropriate, in the folio of the Register kept under that Act that relates to the land subject to the burden of the restriction, to record in like manner any dealing purporting to affect the operation of a restriction so recorded and to record in like manner any release, variation or modification of the restriction,
(b) a recording in the Register kept under that Act of any such restriction shall not give the restriction any greater operation than it has under the dealing creating it, and
(c) a restriction so recorded is an interest within the meaning of section 42 of that Act.
(4) Subsection (1) does not apply to an easement without a dominant tenement acquired by or for a prescribed authority referred to in section 88A, nor to any restriction on the use of land in relation to any such easement.
...

88A Easements in gross

(1) In this section:

‘prescribed authority’ means:

(a) the Crown, or
(b) a public or local authority constituted by an Act, or
(c) a corporation prescribed by the regulations for the purposes of this section.

(1A) An easement without a dominant tenement may be created in favour of a prescribed authority, and any such easement may be assured to a prescribed authority.
(1B) However, an easement without a dominant tenement may only be created in favour of, or assured to, a corporation prescribed by the regulations for the purposes of this section if the easement is for the purpose of, or incidental to, the supply of a utility service to the public, including (but not limited to):
(a) the supply of gas, water or electricity, or
(b) the supply of drainage or sewage services.
(1C) Nothing in subsection (1B) prevents the creation by a corporation prescribed by the regulations for the purposes of this section of an easement for the purpose of, or incidental to, the provision of rail infrastructure facilities.
(2) In an instrument which:
(a) takes effect on or after 15 June 1964 (the commencement of the Local Government and Conveyancing (Amendment) Act 1964),
(b) purports to create a right-of-way or drainage easement without a dominant tenement, and
(c) purports to create or assure such a right-of-way or drainage easement in favour of or to a prescribed authority,
the expressions ‘right of carriage way’, ‘right of footway’, ‘easement to drain water’ and ‘easement to drain sewage’ have the same effect as if there had been inserted in lieu thereof respectively the words contained in Schedule 4A.
(2A) In an instrument which takes effect after the commencement of Schedule 1 [5] to the Property Legislation Amendment (Easements) Act 1995 and purports to create or assure an easement without a dominant tenement of the following kind in favour of or to a prescribed authority, the following expressions have effect as if the words attributed in Schedule 4A to those expressions were inserted instead:

easement for repairs

easement for drainage of sewage

easement for drainage of water

easement for electricity purposes

easement for services

easement for water supply

right of access

(2B) The meaning given to an expression by this section and Schedule 4A may be varied (whether by way of addition, exception, qualification or omission), and is taken to have always been capable of being so varied, by the instrument in which the expression is used.
(2C) In Schedule 4A:
(a) a body includes any person for the time being authorised by the body, and
(b) a lot includes any other distinct piece or parcel of land (such as an island, a portion of a Parish or a Section).
(2D) The power conferred by this section is taken always to have existed. However, the power conferred by this section on a corporation prescribed by the regulations for the purposes of this section confers that power on and from the date the corporation is first so prescribed if the regulations so provide.
(2E) The restriction imposed by subsection (1B) on the power conferred by this section does not apply to an easement created or assured before the commencement of that subsection.
(3) This section applies and shall be deemed always to have applied to land under the provisions of the Real Property Act 1900.
...

88B Creation and release of easements, profits à prendre and restrictions on use of land by plans

(1) In this section ‘public road’ and ‘road’ have the meanings respectively ascribed to those expressions by the Roads Act 1993.
(2) A plan shall not be lodged in the office of the Registrar-General for registration or recording under Division 3 of Part 23 unless it indicates in the manner prescribed in respect of the plan by regulations made under this Act or the Real Property Act 1900:
(a) what easements, if any, are intended to be created:
(i) burdening land comprised in the plan and appurtenant to any existing roads shown on the plan, and
(ii) appurtenant to any roads to be vested upon registration of the plan,
(b) what easements, if any, referred to in section 88A are intended to be created burdening land comprised in the plan and in whose favour those easements are intended to be created,
(c) what other easements or profits à prendre, if any, are intended to be created appurtenant to or burdening land comprised in the plan, and
(c1) what easements or profits à prendre, if any, appurtenant to or burdening land comprised in the plan are intended to be released or partially released, and
(d) what restrictions on the use of land or positive covenants, if any, are intended to be created benefiting or burdening land comprised in the plan.
(3) On registration or recording under Division 3 of Part 23 of a plan upon which any easement, profit à prendre, restriction or positive covenant is indicated in accordance with paragraph (a), (b), (c) or (d) of subsection (2) then, subject to compliance with the provisions of this Division:
(a) any easement so indicated as intended to be created as appurtenant to any existing public roads shown in the plan or any roads to be vested in the council upon registration of the plan shall be created and shall without any further assurance vest in the council by virtue of such registration and of this Act,
(b) any easement so indicated as intended to be created pursuant to section 88A shall be created and shall without any further assurance vest in the relevant prescribed authority referred to in that section by virtue of such registration and of this Act,
(c) any other easement, profit à prendre or any restriction on the use of land (not being a restriction as to user of the type that may be imposed under section 88D or 88E) so indicated as intended to be created shall:
(i) be created,
(ii) without any further assurance and by virtue of such registration or recording and of this Act, vest in the owner of the land benefited by the easement or profit à prendre or be annexed to the land benefited by the restriction, as the case may be, notwithstanding that the land benefited and the land burdened may be in the same ownership at the time when the plan is registered or recorded and notwithstanding any rule of law or equity in that behalf, and
(iii) not be extinguished by reason of the owner of a parcel of land benefited by such easement, profit à prendre or restriction holding or acquiring a greater interest in a separate parcel of land burdened thereby, and
(d) any restriction on the use of land or positive covenant that is of the type that may be imposed under section 88BA, 88D or 88E and is so indicated as intended to be created takes effect as if it had been so imposed.
(3AA) On registration or recording under Division 3 of Part 23 of a plan on which a release of an easement or profit à prendre is indicated in accordance with subsection (2) (c1), the easement or profit à prendre is released.
(3A) When creating a folio of the Register kept under the Real Property Act 1900 for land benefited by any easement, or for land burdened by any easement, restriction on the use of land or positive covenant, created by this section, the Registrar-General shall record in that folio, in such manner as the Registrar-General considers appropriate, the easement, restriction on the use of land or positive covenant, as the case may be.
(4) Any restriction on the use of land or positive covenant created by this section shall for the purposes of this Act and the Real Property Act 1900, have effect as if it was contained in a deed. ”

24 I accept the submission advanced for the defendant that an easement in gross can be created pursuant to s 88B(2)(a) and (3)(a). That is to say, I do not consider that s 88A is the only means of creating an easement in gross, nor, that the word “easement” when used in s 88B(2)(a) and (3)(a) has the meaning accorded at common law requiring both a servient and a dominant tenement. The word “easement” can be used to describe an easement in gross, that is, an easement without a dominant tenement, and is so described in s 88A. In R A Woodman, The Law of Real Property in New South Wales, (1980) Vol 1, The Law Book Company Ltd, at 308, Professor Woodman said:

“ ... an easement in gross may be created by registration with the Registrar-General of a plan of subdivision indicating the intention to create it as an easement in gross: s. 88B(3)(b); and the same situation exists where it is intended to create easements as appurtenant to any existing public roads shown in the plan or roads to be vested in the council upon registration of the plan: s. 88B(3)(a).
Section 88A represents a statutory recognition of the practice whereby at common law there could be created what amounts to an easement without a dominant tenement. For example, a corporation constituted by the inhabitants of a town may have enjoyed from time immemorial the right to discharge drainage into a tidal river, or a highway authority may have enjoyed a right to discharge water on to land for draining a highway: see Gale on Easements , 14th ed., 143; Goodman v. Mayor etc., of Saltash (1882) 7 App. Cas. 633; Attorney-General v Copeland [1902] 1 K.B. 690. The Legislature has frequently taken rights of this kind for the Crown, or conferred them upon public or local authorities constituted by Act of Parliament, and called them easements; see Public Works Act , 1912, s. 4A; Metropolitan Water Sewerage and Drainage Act , 1924, s. 116; as to the assessment of compensation, see Rogerson v The Minister (1968) 16 L.G.R.A. 400; Brancatisano v. The Minister (1967) 16 L.G.R.A. 405. ”

25 Professor Woodman’s view that an easement appurtenant to an existing public road, to be vested in a council pursuant to s 88B(3)(a), can be created as an easement in gross, is repeated by the current authors of Woodman and Nettle: The Torrens System in New South Wales, 2nd ed (2003) Thomson Lawbook Co at 29059. That that is so is indicated by the fact that whilst all easements created under s 88B(3)(a) as appurtenant to an existing public road vest in “the Council” upon registration of the plan, not all public roads are owned by councils (ss 7 and 145 Roads Act 1993 (NSW)). That was also the position when s 88B was introduced into the Conveyancing Act by the Local Government and Conveyancing (Amendment) Act 1964 (NSW), (Commissioner for Main Roads v BP Australia Ltd (1964) 82 WN (Pt 2) (NSW) 27 at 29, 41-42).

26 In Bonvale Enterprises Pty Ltd v Halpenny Investments Pty Ltd (2005) 62 NSWLR 698, Burchett AJ held that the power conferred on the Court by s 88K of the Conveyancing Act to create easements did not extend to the creation of easements in gross. His Honour’s conclusion that the word “easement” in s 88K had its technical meaning at common law requiring it to be for the benefit of an identified dominant tenement was based on the particular features of s 88K (see at 704 [8], 705-706 [11]-[13]). His Honour’s construction of s 88K does not indicate the proper construction of s 88B(2)(a) and (3)(a).

27 However, the fact that an easement in gross could be created under ss 88B(2)(a) and (3)(a) does not necessarily mean that this has occurred here. The Council is the owner in fee simple of Mildon Road, and I can see no reason the parties could not create an easement which conforms with the common law requirements for an easement and of s 88(1) of the Conveyancing Act, rather than an easement in gross. The question is whether on the proper interpretation of the easement, the easement can only be used to drain water for the benefit of Mildon Road and the plaintiffs’ lots identified as the lots benefited by the easement.

28 The defendant points to the language of Pt 3 of Sch 8. The Council is a person entitled to an estate in possession in Mildon Road which is land indicated as one of the dominant tenements. The defendant is a person authorised by the Council to drain water across and through the land indicated as a servient tenement.

29 It was submitted for the Council that it was not legitimate to construe the easement having regard to any implications which might flow from the common law requirement that an easement accommodate the dominant tenement or from the statutory context of s 88B of the Conveyancing Act including the presence of s 88A and Pt 3 of Sch 4A. Rather, it was submitted, the High Court’s decision in Westfield Management Ltd v Perpetual Trustee Co Ltd [2007] HCA 45; (2007) 239 ALR 75; 81 ALJR 1887, limited the matters to which it was legitimate to have regard in construing the easement to the “four walls of the easement” and the physical characteristics of the land.

30 I do not consider that there is anything in Westfield Management Ltd v Perpetual Trustee Co Ltd, or in Sertari Pty Ltd v Nirimba Developments Pty Ltd [2007] NSWCA 324 which either requires or justifies ignoring the statutory context of s 88B(3)(a) or the common law requirements of an easement. Those cases dealt with the question of what extrinsic facts are admissible to construe an easement. That is a different question.

31 The defendant accepts that if the easement had been created pursuant to ss 88B(2)(c) and (3)(c), the same words would be read as only authorising the use of the servient tenement by the Council (or the person entitled to an estate in possession of the lots identified as lots benefited by the easement) or a person authorised by it (or such persons), for the benefit of the dominant tenement. But counsel for the defendant submits that that is so because in the case of an easement created under s 88B(3)(c) the easement, to be valid, must accommodate the dominant tenement. It was submitted that because there was no such requirement for an easement appurtenant to a public road which vests in a council pursuant to s 88B(3)(a), there is no reason to read down the literal words of the easement by such an implication.

32 The easement is not fully expressed simply by the terms of Pt 3 of Sch 8 of the Conveyancing Act quoted in para [7] above. Those words are to be read in the context of the instrument set out at para [6] above which names specified lots and Mildon Road as the lands benefited by the easement and does not name the Council as a person or authority benefited. The parties chose not to create the easement as an easement in gross using the terms in Part 3 of Sch 4A which contains no reference to a dominant tenement.

33 The construction of the easement under Pt 3 of Sch 8 that the rights granted are to be granted for the benefit of the dominant tenement does not merely arise by implication from the nature of a true easement at common law. Such an implication could be rebutted by the fact that s 88A(2)(a) and (3)(a) allow the creation of an easement in gross. But the construction also arises from the express terms of the instrument which identifies particular lots and Mildon Road as the lots and road benefited. It is also significant that in the instrument the Council is not separately named as an authority benefited. The benefit of the easement is expressly stated to attach to the identified pieces of land. Thus, whilst I accept that an easement in gross could be created under s 88A(3)(a), I do not consider that that was the kind of right the parties intended to create.

34 Regulation 33 of the Conveyancing (General) Regulation 2003 specifies the requirements for the form and content of s 88B instruments. It provides:

“33 Form and content of section 88B instruments

(1) A section 88B instrument is to be in the approved form.

...

(4) The instrument must contain, after each statement, a schedule setting out the lot numbers of the lots burdened by the easement, profit à prendre, restriction or positive covenant (numbered individually and in numerical sequence) and, opposite the lot number of each lot burdened:
(a) the numbers of the lots intended to receive the benefit of the easement, profit à prendre, restriction or positive covenant, and
(b) the name of any road to which any easement, profit à prendre, restriction or positive covenant is to be appurtenant, and
(c) the name of any body in whose favour any easement in gross or positive covenant without a dominant tenement is to be created, and
(d) the name of any prescribed authority in whose favour any restriction on the use of land or positive covenant that is of the type that may be imposed under section 88E of the Act is to be created.
(5) The instrument must contain, after each statement, a schedule setting out the lot numbers of the lots burdened by each easement or profit à prendre, if any, proposed to be released and, opposite the lot number of each lot burdened:
(a) the number of the lots that receive the benefit of the easement or profit à prendre, and
(b) the name of any road to which the easement is appurtenant, and
(c) the name of any prescribed authority in whose favour any easement in gross was created.
... ”

35 The regulation required an instrument which was intended to create an easement in gross to set out opposite the lot number of each lot burdened the name of the body in whose favour such an easement was to be created (reg 33(4)(c)). No such body was named in the s 88B instrument, which is consistent with the parties not intending to create an easement in gross.

36 Accordingly, I accept the submission of counsel for the plaintiff that on the proper construction of the easement, the Council, as owner of the dominant tenement (Mildon Road), may authorise use of the servient tenement for the purpose of benefiting Mildon Road. The Council is not entitled to authorise the defendant to use the easement for the purpose of draining water from the defendant’s land unless that were also for the purpose of benefiting Mildon Road. It was faintly suggested by counsel for the defendant that there could be such a benefit to Mildon Road if the defendant connected its drainage works to the drain on the plaintiffs’ land. However, there is no evidence that that would be so. If that were the basis upon which the defendant or the Council contended for an affirmative answer to question 4, then that fact would need to have been proved.

37 For these reasons I will answer question 4, no. Question 5 does not arise. It follows also that question 6 should be answered no.

Section 51 of the Local Government Act

38 Section 51 of the Local Government Act provides:

“51 Use of land held for drainage purposes

Land that is held by council for drainage purposes may be used for any other purpose that is not inconsistent with its use for drainage purposes, subject to the Environmental Planning and Assessment Act 1979 and any environmental planning instrument applying to the land.”

39 “Land” is not defined in that Act. Section 21(1) of the Interpretation Act 1987 (NSW) provides:

“ 21 Meanings of commonly used words and expressions

(1) In any Act or instrument:

...

‘land’ includes messuages, tenements and hereditaments, corporeal and incorporeal, of any tenure or description, and whatever may be the estate or interest therein. ”

40 It was submitted for the Council that the easement was “land that is held by council for drainage purposes” within the meaning of s 51, because in that section land meant not only physical land but included incorporeal hereditaments. It was submitted that if the easement was for the purposes of draining Mildon Road only, nonetheless the Council was entitled, pursuant to s 51, to authorise the use of the land for any other purpose which was not inconsistent with that purpose, including drainage from the defendant’s land.

41 The definition of “land” in the Interpretation Act applies to the construction of the Local Government Act, except insofar as the context or subject matter otherwise indicates or requires (s 6 Interpretation Act). Section 51 is in Div 3 of Pt 2 of Ch 6 of the Local Government Act. The introduction to Ch 6 states that the chapter confers on councils their service or non-regulatory functions, examples of which include the provision, management or operation of stormwater drainage and flood prevention, protection and mitigation services and facilities. Numerous other facilities are identified in the introduction. The introduction then states:

“ These functions are conferred in broad terms in Part 1. Particular provisions are made for the management of public land in Part 2. Part 3 imposes some restraints and qualifications on the exercise of the service functions.”

42 Division 1 of Pt 2 is concerned with the classification of public land as community land or operational land. “Public land” is defined as follows:

“’public land’ means any land (including a public reserve) vested in or under the control of the council, but does not include:

(a) a public road, or
(b) land to which the Crown Lands Act 1989 applies, or
(c) a common, or
(d) land subject to the Trustees of Schools of Arts Enabling Act 1902, or
(e) a regional park under the National Parks and Wildlife Act 1974.”

43 Division 2 of Pt 2 contains provisions concerning the use and management of community land. Division 3, which includes s 51, is headed “Miscellaneous”. Section 48 provides for councils to have control of certain public reserves. Subsection 49(1) provides that on registration of a plan on which land is marked with the words “public reserve” the land is dedicated as a public reserve and vests in the Council. Section 49(3) provides for land shown on a plan as “drainage reserve” to vest in the Council for an estate in fee simple and to be held by the Council for drainage purposes. Section 50 is concerned with the subdivision of land where the subdivision makes provision for public garden and recreation space or makes provision for a drainage reserve. Subsection 50(5) provides for the vesting of land in the Council when certain steps are taken which, in the case of drainage reserves, are to be held by the Council for drainage purposes.

44 This is the context of s 51. In this context, “land that is held by council for drainage purposes” refers to physical land. It is physical land which is the subject of Pt 2 of Ch 6 and which is also the subject of ss 49 and 50. An example of the intended operation of s 51 would be to allow a drainage reserve to be used as a park or for general community use (two of the categories of community land) if that were not inconsistent with use of the land for drainage purposes. Although there is no definition of “land” in the Local Government Act speaking only of land as a topographical entity and not as a bundle of rights (North Sydney Council v Ligon 302 Pty Ltd (1996) 185 CLR 470 at 481), the context of s 51 shows that the word is used in that sense. The presumption is that s 51 was not intended to expand rights of property which the Council had against third parties and thereby diminish the proprietary rights to land of third parties. For these reasons, I do not accept that the rights granted to the Council by the easement vested in it under s 88B(3)(a) are enlarged by s 51 of the Local Government Act.

45 Counsel for the defendant also submitted that even if in s 51 “land” means the physical land, the physical land was “held” by the Council by virtue of its rights under the easement, notwithstanding that such land was owned by the plaintiffs. There is no definition of “held”. Whilst to “hold” land might (depending upon the context) denote something less than ownership, such as possession, I do not consider that, in the context of s 51, a council holds land merely because it has the right to use the land for drainage purposes. On this construction, s 51 would mean that land a council was entitled to use for drainage purposes, may be used for any other purpose that was not inconsistent with its use for drainage purposes. Such a construction would interfere with the proprietary rights of the owner or occupier of the land, and is not warranted. The Council does not “hold” the servient tenement because it is entitled to use it for drainage purposes. For these reasons, question 7 should be answered, no.

Conclusion

46 For these reasons I answer the separate questions as follows:

1. Is Wyong Shire Council the owner of the drainage works situated within the Existing Easement on Trevlind’s land pursuant to section 59A of the Local Government Act 1993 (NSW)?

No

2. If the answer to the previous question is yes; does that constitute a lawful basis for Wyong Shire Council to authorise BMP Manufacturing’s officers, employees and agents to enter upon the Existing Easement, bring equipment upon the Existing Easement, undertake works upon the Existing Easement as contemplated in the Development Consent and connect to the drainage works and to drain water from BMP Manufacturing’s land to the drainage works within the Existing Easement?

Does not arise

3. If the answer to the previous question is yes; does the Development Consent, properly construed, constitute a lawful authorisation granted to BMP Manufacturing by Wyong Council for officers employees and agents of BMP Manufacturing to enter upon the Existing Easement, bring equipment upon the Existing Easement, undertake works upon the Existing Easement as contemplated in the Development Consent, and connect to the drainage works within the Existing Easement and to drain water from BMP Manufacturing’s land to the drainage works as contemplated in the Development Consent?

Does not arise

4. Does the Existing Easement properly construed, constitute a lawful basis for Wyong Shire Council to authorise BMP Manufacturing’s officers, employees and agents to enter upon the Existing Easement, bring equipment upon the Existing Easement, undertake works upon the Existing Easement, connect to the drainage works and to drain water from BMP Manufacturing’s land to the drainage works within the Existing Easement as contemplated in the Development Consent?

No

5. If the answer to the previous question is yes; does the Development Consent, properly construed, constitute a lawful authorisation granted to BMP Manufacturing by Wyong Council for officers employees and agents of BMP Manufacturing to enter upon the Existing Easement, bring equipment upon the Existing Easement, undertake works upon the Existing Easement as contemplated in the Development Consent, and connect to the drainage works within the Existing Easement and to drain water from BMP Manufacturing’s land to the drainage works as contemplated in the Development Consent?

Does not arise

6. Alternatively, does the Existing Easement properly construed, constitute a lawful basis for Wyong Shire Council to drain water from the Proposed 88A Easement into the drainage works within the Existing Easement?

No

7. Can the defendant be authorised by the Council to drain water from its land to, across and through the Existing Easement pursuant to s 51 of the Local Government Act 1993.

No

47 As the plaintiffs have been successful, they are entitled to their costs of the determination of the separate questions from the defendant and the Council. I order the defendant/cross-claimant and the fourth cross-defendant pay the costs of the plaintiffs/first to third cross-defendants of the separate questions.

48 The exhibits may be returned after 28 days.

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