Anderson v Tooheys Limited

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 401730/01 LEC 300061/99 MASON JA SHELLER JA HODGSON JA

Friday 24 May 2002 MINISTER FOR LAND & WATER CONSERVATION V. NTL AUSTRALIA PTY. LIMITED

The Commonwealth was granted a permissive occupancy under s.136K of the Crown Lands Consolidation Act 1913 (NSW). The permissive occupancy was numbered 61/66, and concerned a parcel of land at Mt. Sugarloaf. The purpose was identified as for the erection of television mast, transmission buildings and installations. The permissive occupancy provided that rent was payable in advance and that the permissive occupancy was terminable at will by the Commonwealth Minister for Finance and Administration. The conditions of the permissive occupancy also provided that the tenant could not part with possession or sublet the premises, or sell or transfer the permissive occupancy without the prior consent of the Commonwealth Minister.

On 26 June 1998 the Minister for Land and Water Conservation gave notice of a redetermination of rent of the permissive occupancy. The Commonwealth lodged an objection to this redetermination and the Minister reconfirmed the previous redetermination. On 4 April 1999, the Commonwealth commenced proceedings in the Land and Environment Court.

On 21 December 1998 the National Transmission Network Sale Act came into force. This Act related to the sale by the Commonwealth of the national transmission network. On 29 April 1999, the Commonwealth Minister made a declaration under the Act to the effect that the entitlement of the Commonwealth in or in relation to certain sites, including the land at Mt. Sugarloaf, vested in the National Transmission Company Pty. Limited.

On 25 May 1999, the company was substituted for the Commonwealth as the applicant in the Land and Environment Court proceedings. In November 1999, the company changed its name to NTL Pty. Limited. The Minister sought determination of two questions. The parties reached agreement on the first question. The second question was as follows:

Whether the permissive occupancy granted by the Minister was revoked by reason of the declaration made by the Minister for Finance and Administration on 29 April 1999.

NTL contended that the Land and Environment had no jurisdiction to determine the question, and in the alternative contended for a negative answer to it. Pearlman J held that the Court did have jurisdiction and answered the question in the negative. The Minister appealed from the decision on the preliminary question.

HELD: per Sheller JA (Mason P agreeing)

1. The features of a permissive occupancy are similar to those of a tenancy at will or a personal license. Both types of rights are such that assignment without consent terminates the rights.

The permissive occupancy was terminated when the Commonwealth vacated the premises and there was nothing left to be transferred.

The fact that the permissive occupancy was transferable with the consent of the Minister was irrelevant as there was no such consent.

The Declaration which purported to transfer the benefit of the permissive occupancy to NTL was ineffective because the transfer terminated the permissive occupancy by reason of the inherent nature of the grant.

per Mason P:

1. The Network Sale Act does not purport to change or affect the legal incidents of "assets" as defined by s.3 of the Act. The incidents of such assets are to be determined by existing common law or statute law.

per Hodgson JA dissenting

1. The Commonwealth's rights under the permissive occupancy were statutory rights whose nature and incidents depend on statute rather than general law.

2. Section 136K of the Crown Lands Consolidation Act 1913 is more suggestive of a license than a lease, but the conditions imposed by the Minister on the permissive occupancy are more suggestive of a tenancy than a license.

3. Condition 6 of the permissive occupancy makes it clear that the rights under the permissive occupancy can be transferred with the prior consent of the Minister. This does not create a new permissive occupancy but is a continuation of the existing one. This is possible even after the introduction of the Crown Lands Act 1989

4. "Asset" in s.3 of the Network Sale Act includes rights under a permissive occupancy.

The use of the words "transfer time" and "transferred asset" in the Network Sale Act does not impose on the process in s.9 of the Act the limits that attach to the legal concept of transfer.

Transfer of the occupancy rights without consent will give rise to breach, but s.12 of the Network Sale Act provides that the process of vesting the assets of the Commonwealth in NTL should not be considered a breach of any contractual provision. This should be interpreted to include a breach of the permissive occupancy.

While a transfer in breach of a prohibition against transfer is wholly ineffectual, the intention of the Network Sale Act was to put the company in the position of the Commonwealth. The transfer was effective as if it was a transfer with the prior consent of the Minister.

1 ORDERS

1. Appeal allowed.
2. Question 2 in the Notice of Motion filed on 16 May 2000 should be answered yes.
3. NTL should pay the costs of the Minister of the application on the Notice of Motion in the Land and Environment Court and of this appeal with a certificate under the Suitors' Fund Act 1951 if so entitled.

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40173/01 LEC 30061/99

MASON P SHELLER JA HODGSON JA

Friday 24 May 2002 MINISTER FOR LAND AND WATER CONSERVATION V. NTL AUSTRALIA PTY. LIMITED Judgment

2 MASON P: I have had the benefit of reading in draft the judgments of Sheller JA and Hodgson JA. 3 I agree with the orders proposed by Sheller JA and with his reasons. 4 The National Transmission Network Sale Act 1998 (Cth) (the Network Sale Act) provides a mechanism whereby an existing congeries of "assets" constituting the national transmission network that are vested in the Commonwealth may be vested in a nominated company as the Commonwealth's successor in law. 5 Once an "asset" is identified and designated by Ministerial notice, the Network Sale Act expresses itself in terms of broadest generality. Niceties of conveyancing law and the law of transfer and assignment of personal property are swept away. Subject to compliance with s9(1), then by force of federal law the designated asset vests in the transferee as the Commonwealth's successor in title. 6 The Network Sale Act defines "asset" in the broadest of terms (s3). The Note which forms part of s9(4) makes it plain that: The assets and liabilities that can be transferred under this section include assets and liabilities that consist of rights and obligations under contracts.

There is thus ample work for the Network Sales Act in relation to non-proprietorial contractual "assets". 7 Under the general law (common law and statutory) contractual rights are choses in action. This means that the benefits thereof and (to a much lesser extent) the burdens thereof are assignable, subject to various legal principles (see generally Lindgren, Carter and Harland, Contract Law in Australia 1st ed, 1986 [918]ff). 8 Not all choses in action are assignable (see generally Starke, Assignment of Choses in Action in Australia chapter 7). If a contract prohibits assignment of certain rights arising under it, a purported assignment of those rights will be ineffective as an assignment, in the sense that it does not give the assignee any rights against the party bound even though it may be enforceable as a contract between assignor and assignee (Linden Gardens Trust Ltd v Lenesta Sludge Disposals [1994] 1 AC 85, Re Turner Corporation Ltd (in liq) (1995) 17 ACSR 761). If assignment were permissible in such cases it would alter the rights of the party who in the course of defining the nature of the contractual relationship stipulated clearly against assignment (cf Bruce v Tyley (1916) 21 CLR 277 at 289, Starke, op cit pp65-7). 9 Here the rights of the Minister and the Crown in right of New South Wales stem from the terms of the permissive occupancy construed in light of s136K of the Crown Lands Consolidation Act 1913. For the reasons given by Sheller JA, the legal character of those rights is (for present purposes) that of a personal licence or perhaps a tenancy at will. In either case, one indubitable aspect is the prohibition of transfer without the prior consent of the Minister for Lands (condition 6). The nature of such an asset is that a purported assignment without due consent operated as a termination of the licence or tenancy. This was a legal incident of the asset. 10 It is unnecessary to grapple with the situation that would apply if the Minister had first consented to a transfer (cf condition 6). There was no such prior consent. 11 The Network Sale Act does not purport to change or affect the legal incidents of the broad range of "assets" which it addresses. It takes them as given, with their incidents to be determined by the existing common law or statute law. The Network Sale Act provides compendiously and in a standard way for the transfer of all manner of assets, but it does not purport otherwise to vary their incidents. Indeed, it contemplates that, in the hands of the nominated successor, those incidents will remain (see s9(1)(b)). 12 SHELLER JA: I have had the benefit of reading in draft the judgment prepared by Hodgson JA. I need not repeat all the circumstances which bring this appeal to the Court. 13 In Smith v Smyth (1935) 14 LVR 98 at 104, Pike J said that a permissive occupancy was "purely a temporary occupancy, granted for the period during which the Department is considering the manner in which it will deal with the area in question." In Barrow v Brooksby (1958) 37 LVR 14 at 17, Sugerman J quoted this description and said that it appeared to be an accurate description of a permissive occupancy, subject to the possible qualification that there might be other reasons or purposes for its granting than the single purpose to which Pike J referred. Sugerman J continued: To what category in the law is a permissive occupancy to be referred? Is it a tenancy, or is it of the character to which Mr O'Keefe referred, citing Winter Garden Theatre (London) Ltd v Millennium Productions Ltd [1948] AC 173 at 198 as a personal licence for valuable consideration?

The form of document which is required to be executed by the occupant in terms treats it as a tenancy at will terminable by notice by either party (that is to say by the Secretary for Lands or by the occupant) at any time, at a rental payable in advance, and subject to certain conditions as to the removal of improvements and otherwise which are set out in the document. It may be that, notwithstanding that the language of the document is preponderantly the language of tenancy the true character of the relationship which it creates is that of licensor and licensee - that is to say that it creates a personal licence for valuable consideration revocable by notice at any time. 14 The permissive occupancy with which we are concerned was expressed in condition 2 to be terminable at will by the Minister (see also cl 5 of Pt 6 of Sch 2 of the Crown Lands (Continued Tenures) Act 1989). Condition 5 prohibited the "tenant" from parting with possession of the premises or transferring the permissive occupancy "without the consent of the Minister for Lands having first been obtained." 15 In Minister for Natural Resources v New South Wales Aboriginal Land Council (1987) 9 NSWLR 154 at 161, McHugh JA said: A permissive occupancy is not a lease or occupation licence. It is a 'personal licence such as would afford a defence to an action for trespass': see Barrow v Brooksby at 19.

Section 136K(1) of the Crown Lands Consolidation Act 1913 spoke of the grant of "permissions to occupy Crown lands". So categorised and distinct from a licence coupled with the grant of a proprietary interest in the land (compare a profit a prendre and see The Queen v Toohey ; Ex parte Meneling Station Pty Limited (1982) 158 CLR 327 at 342 and 352) but creating a contractual right only, it was revocable at law even if by revoking it the licensor committed a breach of an associated contract; see generally Cowell v Rosehill Racecourse Company Limited (1937) 56 CLR 605 at 615-617, 628, 631 and 655-6. 16 In Cowell v Rosehill Racecourse Company Limited the High Court followed Wood v Leadbitter (1845) 13 M & W 838; 153 ER 351 and not Hurst v Picture Theatres Limited [1915] 1 KB 1. Hurst v Picture Theatres Limited has been said to stand for the following propositions; see Meagher, Gummow and Lehane, Equity Doctrines and Remedies, 3rd ed (1992) at para 2148: (a) a contractual licensee who is granted the right to enter land for some limited purpose, eg to see a spectacle, is not a mere licensee; he has a licence coupled with a grant; the grant is of the contractual right to enter, and that grant is - after the Judicature Act 1873 - the grant of a legal proprietary interest; (b) the only reason why such a right was not recognised as a proprietary right in Wood v Leadbitter was because in that case the right had not been created under seal, but after the Judicature Act an interest in land could be created otherwise than by deed; and (c) in every contractual licence there was an implied negative stipulation by the licensor not wrongfully to revoke the licence, not to treat the licensee as a trespasser until the licence had been validly determined.

The authors at 2150 said that, in refusing to accept any of these propositions, the High Court's reasoning was least satisfactory when dealing with the third: compare Hounslow London Borough Council v Twickenham Garden Developments Limited [1971] Ch 233 at 250 per Megarry J. In the present case the "licence" was terminable at will by the Minister. The Minister did not terminate the permissive occupancy. We are not therefore concerned with whether, if he had done so, the termination would have been valid. 17 While there may be no authority on the point, the licence was probably also revocable by the licensee, in this case the "tenant". See generally, Dawson and Pearce, Licences Relating to the Occupation or Use of Land (1979) at 94. 18 The apparent similarity of a permissive occupancy to a tenancy at will makes apposite what Jordan CJ said in Anderson v Tooheys Limited (1937) 37 SR (NSW) 70 at 74 in marking the difference between a letting at will and a letting for a term. A tenancy at will is terminable at the will of either party: it constitutes a personal relation between the landlord and tenant, and therefore terminates upon the death of either: Scobie v Collins [1895] 1 QB 375. A purported assignment by a tenant at will, if followed by the giving up of a premises, operates as a termination of the tenancy, because it is inconsistent with an intention on his part that his personal tenancy shall continue. If the landlord agrees to the purported assignment, either expressly or by recognising the purported assignee as tenant, this operates by implication as a termination of the old tenancy at will and the creation of a new tenancy at will with the incoming tenant: Buckworth v Simpson (1835) 1 Cr M & R 834 at 844; 149 ER 1317 at 1322.

The owner's acceptance of or agreement to occupation by the purported transferee operates not as the recognition or acceptance of a transfer but as a novation. The estate created by the tenancy at will is unassignable: see Commonwealth Life (Amalgamated) Assurance Limited v Anderson (1945) 46 SR (NSW) 47 at 49-50. 19 In Linden Gardens Limited v Lenesta Limited [1994] 1 AC 85, building contracts included terms that the employer should not, without the written consent of a contractor, assign the contract. At 108-9, Lord Browne-Wilkinson referred to existing authorities which established that an attempted assignment of contractual rights in breach of a contractual prohibition was ineffective. His Lordship said: If the law were otherwise, it would defeat the legitimate commercial reason for inserting the contractual prohibition, viz, to ensure that the original parties to the contract are not brought into direct contractual relations with third parties. 20 In argument, counsel drew an analogy with leases. As to that, Lord Browne-Wilkinson said: I was originally impressed by the fact that an assignment of the term in breach of covenant is effective to vest the term in the assignee … 21 His Lordship was speaking of a demise creating a term which was capable of being assigned or sub-let; compare the judgment of Jordan CJ in Anderson v Tooheys Limited at 74. In that context, Lord Browne-Wilkinson said at 108-109: A lease is a hybrid, part contract, part property. So far as rights of alienation are concerned a lease has been treated as a species of property. … by the time of Coke covenants against the assignment of leases had been held to be good, because the lessor had a continuing interest in the identity of the person who was his tenant: …. The law became settled that an assignment in breach of covenant gave rise to a forfeiture, but pending forfeiture the term was vested in the assignee. In contrast, the development of the law affecting the assignment of contractual rights was wholly different. It started from exactly the opposite position, viz, contractual rights were personal and not assignable. Only gradually did the law permitting assignment develop: Holdsworth , vol VII, pp 520-521 and 531 etc. It is therefore not surprising if the law applicable to assignment of contractual rights differs from that applicable to the assignment of leases. 22 I reiterate that the difference referred to was between the alienation of a lease for a term, that is to say of the benefit of the term, and the alienation of the benefit of a contract. The law applicable, it seems to me, to a permissive occupancy means that, whether it be regarded as a personal licence for consideration or a form of tenancy at will, since assignment is prohibited without the consent of the Minister, a purported assignment without such consent operates as a termination of the licence or tenancy. Such an assignment is inconsistent with the personal relation between the parties and with the express intention of the Minister that the occupancy remain personal to the Commonwealth. It is this consequence arising from the nature of the permissive occupancy that must be examined in considering the effect of the National Transmission Network Sale Act 1998 (Cth) (the Network Sale Act) or the Minister's declaration thereunder on the Commonwealth of Australia's right of occupancy. 23 Before 29 April 1999 the Commonwealth was the occupier of the site in question. Section 9(1) in Pt 2 of the Network Sale Act provided that the Minister for Finance and Administration (the Commonwealth Minister) might declare that (a) a specified Commonwealth asset vested in a company at a specified time (the transfer time) without any conveyance, transfer or assignment and (b) at the transfer time, the company became the Commonwealth's successor in law "in relation to the transferred asset". I agree for the reasons mentioned by Hodgson JA, that under its permissive occupancy the Commonwealth had a right which was within the meaning of s3 of the Network Sale Act, an "asset". 24 On 29 April 1999 the Commonwealth Minister purported to make a declaration vesting the asset in the respondent, National Transmission Company Pty Limited, which subsequently became NTL Australia Pty Limited. The Chief Judge of the Land and Environment Court, Pearlman J, on the application of the New South Wales Minister for Land and Water Conservation (the Conservation Minister), held that the Commonwealth Minister's declaration effectively vested the rights under the permissive occupancy in NTL. From this decision the Conservation Minister appeals. 25 Hodgson JA has recited the relevant conditions of the standard form adopted for this permissive occupancy. The permissive occupancy is terminable "at will by the Minister" (condition 3). No mention is made of termination by the occupant referred to as "the tenant". Even so, in my opinion, in the absence of a special condition, it also was terminable at the will of the occupant. It may be that either party would have to give notice. See generally, Australian Blue Metal Limited v Hughes [1963] AC 74 at 97-98. The terms of such notice would depend upon many considerations. These need not be investigated as we are not concerned with either party purporting to terminate the permissive occupancy; see Australian Blue Metal v Hughes at 98-102. 26 With due respect the fact that the permissive occupancy was transferable with the consent of the Minister (condition 6) or rather as it is expressed, not transferable "without the consent of the Minister for Lands having first been obtained", is beside the point. The Minister did not give consent. Accordingly, transfer of the permissive occupancy remained prohibited. The consequence of a purported transfer without consent was termination of the permissive occupancy. That follows whether one regards the permissive occupancy as a form of tenancy at will or a form of personal licence for valuable consideration. 27 The Minister's declaration of 29 April 1999 under the Network Sale Act purported to transfer the benefit of the permissive occupancy enjoyed by the Commonwealth to NTL. The declaration could do no more and it did no less. It provided a mechanism for a transfer to be made without the need for any formal conveyance, transfer or assignment. It purported to do so without the consent of the Minister. Accordingly, prima facie, with the concurrent Commonwealth vacation of the premises, the permissive occupancy terminated. Beyond that point the Commonwealth Minister's declaration of 29 April 1999 had no operation. There was nothing left to be transferred to or vested in NTL. 28 Section 12 of the Network Sale Act provides that the operation of Pt 2 of the Act which includes both ss 9 and 12, is not to be regarded as: (c) placing a person in breach of any contractual provision prohibiting, restricting or regulating: (i) the assignment or transfer of any asset ….. 29 The operation of Pt 2 did not place any person in breach of any contractual provision. The occupier, the Commonwealth, could not be regarded as having been placed in breach of any contractual provision. The transfer had not been effected. No transfer occurred. The attempted transfer by the declaration of 29 April 1999 was ineffective, not because of the breach of a contractual provision (there was no such breach), but because the attempted transfer terminated the permissive occupancy. Its inherent nature was such that the "right" subsisted only while the will of both the owner and the occupier for it to do so continued. Once the Commonwealth Minister purported to transfer the common will for the continuation of the permissive occupancy had ceased. By that very act the permissive occupancy was terminated.

NOTICE OF CONTENTION 30 In para 1 of its points of claim in the Land and Environment Court, NTL pleaded that it was the occupier of the land and in para 3 that at all material times it occupied the land subject to the permissive occupancy which was identified. In his points of defence, the Minister admitted those allegations. NTL submitted that from this the inference could be drawn that the Minister had consented to the transfer. I do not think there is any sufficient evidence that the Minister ever consented to a transfer of the permissive occupancy to the company. Nor did NTL at any stage proceed on the basis that such consent had been granted. I agree with Hodgson JA that the notice of contention fails.

ORDERS 1. The appeal should be allowed; 2. Question 2 in the Notice of Motion filed on 16 May 2000 should be answered yes; 3. NTL should pay the costs of the Minister of the application on the Notice of Motion in the Land and Environment Court and of this appeal with a certificate under the Suitors' Fund Act 1951 if so entitled. 31 HODGSON JA: On 4th April 1999, the Commonwealth of Australia commenced Class 3 proceedings in the Land & Environment Court, appealing against a redetermination by the New South Wales Minister for Land and Water Conservation ("the Minister") of the rent of a permissive occupancy of certain land at Mt. Sugarloaf near Newcastle. 32 On 29th April 1999, the Commonwealth Minister for Finance & Administration made a declaration under the Commonwealth National Transmission Network Sale Act 1998 ("the Network Sale Act") which had the general effect that the entitlement of the Commonwealth in or in relation to certain "sites", including the land at Mt. Sugarloaf, vested in National Transmission Company Pty. Limited. On 25th May 1999, the Land & Environment Court gave leave for that company to be substituted for the Commonwealth as the applicant in the proceedings; and on 16th November 1999, that company changed its name to NTL Australia Pty. Limited ("NTL"). 33 By a Notice of Motion filed on 16th May 2000, the Minister sought determination of two preliminary questions. The parties reached agreement on the first question. The second question was as follows: Whether the permissive occupancy granted by the Minister was revoked by reason of the declaration made by the Minister for Finance & Administration on 29th April 1999.

NTL contended that the Land & Environment Court had no jurisdiction to determine that question, and in the alternative contended for a negative answer to it. 34 On 23rd February 2001, Pearlman J held that the Land & Environment Court did have jurisdiction to answer the question, and went on to answer the question in the negative. 35 The Minister has appealed by leave from the decision on the question. 36 NTL put on a cross-appeal from the decision that the Land & Environment Court had jurisdiction to answer the question: however, that cross-appeal was not pressed.

CIRCUMSTANCES 37 The circumstances bearing on the Minister's appeal can be shortly stated. 38 The relevant permissive occupancy is that numbered 61/66, by which the Commonwealth was given permission to occupy a parcel of land at Mt. Sugarloaf, for a purpose identified in an associated document as the erection of television mast, transmission building and installations. It provided inter alia that the rent for each year was to be paid in advance, and that the permissive occupancy was terminable at will by the Minister. 39 On 26th June 1998, the Minister gave notice of redetermination of rent of the permissive occupancy from $12,000.00 per annum to $74,000.00 per annum, commencing 1st July 1999. On 21st September 1998, the Commonwealth lodged an objection to this redetermination; and on 2nd March 1999, the Minister confirmed the previous redetermination. As noted earlier, these proceedings, appealing against that redetermination, were commenced on 12th April 1999. 40 Meanwhile, on 21st December 1998, the Network Sale Act came into force. This Act related to the sale by the Commonwealth of the national transmission network. As mentioned earlier, a declaration was made under the Network Sale Act on 29th April 1999.

TERMS OF PERMISSIVE OCCUPANCY, STATUTORY PROVISIONS AND DECLARATION 41 The permissive occupancy terms are a standard form, which has 28 standard terms, 12 of which were made applicable to this permissive occupancy. The conditions relevant to this appeal are those numbered 1-7, which are as follows: 1. The rent for each year shall be paid in advance to the Under Secretary for Lands, Sydney.

The Minister, upon giving at least three (3) months notice to the tenant, may review and alter the amount of the rental.

The Permissive Occupancy is terminable at will by the Minister.

Upon termination of the Permissive Occupancy by the Minister all improvements on the land shall become the property of the Crown, and no compensation shall be payable therefore: Provided that on application within one month after such termination, the Minister may permit the former tenant to remove from such land any movable improvements effected by him or at his expense: Provided further that, if directed by the Minister in writing to do so, the former tenant shall remove any structure or material from the land at his own cost and without compensation. In all cases where such permission or direction has been given, the movable improvements or structures or material, as the case may be, shall be removed within such time as the Minister may specify. If not called on to remove such improvements or structures or material, the former tenant shall have the right to sell them to an incoming tenant. If permission has been given for the removal of any structures the former tenant shall leave the land embraced in the premises in a clean and tidy condition and free from rubbish and debris.

The tenant shall pay all rates and taxes and all fees and charges under the Local Government Act, 1919, as amended by subsequent Acts, upon the premises during the currency of the Permissive Occupancy.

The tenant shall not sublet or part with possession of the premises, or any part thereof, or sell or transfer the Permissive Occupancy herein referred to, without the consent of the Minister for Lands having first been obtained. On termination of the Permissive Occupancy the tenant shall deliver up quiet and peaceable possession of the premises.

The tenant shall indemnify and keep indemnified, the Crown from and against all actions, suits, claims and demands of whatsoever nature and all costs, charges and expenses in respect of any accident or injury to any person or property which may arise out of the construction or maintenance of works as may be authorised under the Permissive Occupancy notwithstanding that the conditions of this Permissive Occupancy shall in all respects have been observed by the tenant or that any such accident or injury shall arise from any act or thing which he may be licensed or compelled to do hereunder. 42 The permissive occupancy was granted under s.136K of the Crown Lands Consolidation Act 1913 (NSW). The most relevant sub-section is s.136K(1), which is in the following terms: 136K(1) The Minister may grant permissions to occupy Crown lands, whether above or below or beyond high water marks, or whether reserved from lease or license or not, for such purposes and, subject to this section, upon such terms and conditions as to him may seem fit. 43 Section 136K(5) provides that such permissive occupancies "shall be terminable at the will of the Minister". Section 136K(2) contemplates the grant of permissive occupancies for purposes such as removal of minerals. 44 The Crown Lands Consolidation Act was repealed by the Crown Lands Act 1989 (NSW), which was passed in conjunction with the Crown Lands (Continued Tenures) Act 1989 (NSW) ("the Continued Tenures Act"). Section 6 of the former Act provides to the effect that Crown land is not to be used unless authorised by one or other of these Acts. Its terms are as follows: 6. Crown land shall not be occupied, used, sold, leased, licensed, dedicated or reserved or otherwise dealt with unless the occupation, use, sale, lease, licence, reservation or dedication or other dealing is authorised by this Act or the Crown Lands (Continued Tenures) Act 1989. 45 The Crown Lands Act 1989 makes no provision for the grant of permissive occupancies, although ss.45-50 deals with the grant of licences, revocable by the Minister (s.47) and not transferable (s.46). 46 Section 5 of the Continued Tenures Act provides to the effect that tenures in force under the Crown Lands Consolidation Act immediately before its repeal remain in force subject to the provisions of the Crown Lands Act 1989 and the Continued Tenures Act. Section 11 of the Continued Tenures Act provides that Pt.6 of Schedule 2 applies to and in respect of permissive occupancies. That Part contains the following provisions: 1. Payment of rent etc (1) The rent, royalty , security deposit and any other money payable under the provisions of an Act repealed by the Principal Act in respect of a permissive occupancy are, subject to this Act and the Principal Act, payable under this Act as if those provisions were contained in this Act. (2) Subject to this Act and the Principal Act, any amount shown as payable in the records of the Department in respect of a permissive occupancy is, unless the contrary is proved, payable in the manner and at the time indicated in those records. (3) The rent of a permissive occupancy is payable in advance.

2. Redetermination of rent (1) The rent of a permissive occupancy may be redetermined by the Minister at any time. (2) A redetermination of rent takes effect from the first due date that is not earlier than 3 months after notice of the redetermination has been given by the Minister to the holder (3) Clauses 11 and 12 of Schedule 5 apply to a redetermination of the rent of a permissive occupancy in the same way as they apply to the redetermination of the rent of a lease.

3. Review of royalties and security deposits (1) The Minister may from time to time review the amount of royalty payable, and the amount of any security deposited, in respect of a permissive occupancy. (2) If the Minister is of the opinion that the amount of the royalty or security should be changed the Minister shall serve a notice to that effect on the holder (3) The amount of the royalty or security changes as provided by the notice with effect from a date stated for the purpose in the notice.

4. Conditions (1) Subject to this Act and the Principal Act, a permissive occupancy remains subject to the conditions to which it was subject immediately before the commencement of this clause. (2) A condition of a permissive occupancy which provides for the determination of a matter by a local land board shall be read as providing for the determination of the matter by the Minister. (3) If a condition of a permissive occupancy or any law provides for an appeal against any such determination of a local land board, the condition or law shall be read as providing for an appeal against a determination of the Minister (4) If a condition of a permissive occupancy provides for the exercise of a function by a specified officer, the function may, with the authority of the Minister, be exercised by another officer.

5. Termination A permissive occupancy is terminable at will by the Minister. 47 Clauses 11 and 12 of Schedule 5, referred to in cl.2, are in the following terms: 11. Objections to, and appeals against, redeterminations (1) The Minister shall give notice of a redetermination of the rent of a lease to the lessee and include in the notice a statement to the effect that the lessee may object to the redetermined rent. (2) The Minister shall consider any objection lodged and by notice inform the objector: (a) whether the redetermined rent is to stand or be varied, and (b) that the objector, if dissatisfied with the Minister's decision, may appeal as provided by subclause (3). (3) An appeal against the Minister's decision lies: (a) to the local land board if the determined or redetermined annual rent does not exceed $10,000 or such greater amount as may be prescribed, or (b) in any other case, to the Land and Environment Court. (4) The local land board, or the Court, on hearing the appeal, may affirm the Minister's redetermination or substitute its own. (5) A redetermination of rent takes effect even if an objection or appeal is lodged. (6) If: (a) a redetermination is varied under subclause (2) - the varied redetermination has effect instead of the redetermination varied, or (b) a redetermination is substituted under subclause (3) - the substituted redetermination has effect instead of that for which it is substituted.

12. Redetermination of rent - principles (1) In redetermining the rent of a lease, the Minister, the local land board and the Land and Environment Court shall apply the following principles: (a) except in the case of leases of land within a special land district and prickly-pear leases, the rent shall be the market rent for the land comprised in the lease having regard to any restrictions, conditions or terms to which it is subject, (b) any improvements on the land which were made by the holder, or are owned or in the course of being purchased from the Crown by the holder, shall be disregarded, (c) regard may be had to any additional value which has accrued, or may reasonably be expected to accrue, to other land held by the holder by reason of holding the lease, (d) regard may be had to the duration of the time for which the rent determined will be payable. (2) The rent of a prickly-pear lease shall be redetermined at 2.5 per cent of the market value of the land. (3) Except as provided by clause 13, the rent of an irrigation farm lease, a non-irrigable lease or a town land lease which is subject to periodic redetermination shall be redetermined at 5 per cent of the market value of the land. (4) For the purposes of subclauses (2) and (3), the market value of the land is the market value as determined by the Minister, the local land board or the Land and Environment Court as at the date of the redetermination, exclusive of improvements which were made by the holder or are owned or being purchased from the Crown by the holder. (5) If it appears to the Minister, the local land board or the Court that the value of the land has been reduced by any act, default or neglect of the holder, the value shall be determined as if the reduction in value had not taken place. (6) Subject to section 146 of the Principal Act (minimum rents), a redetermination of the rent of a lease in a special land district is subject to any reduction under the Irrigation Areas (Reduction of Rents) Act 1974. 48 The sale of the national transmission network was given effect to pursuant to the Network Sale Act. Section 3 of that Act contains some definitions relevant to this appeal, notably the definitions of "asset" and "liability". Those definitions are as follows: "asset" means: (a) any legal or equitable estate or interest in real or personal property, including a contingent or prospective one; and (b) any right, privilege or immunity, including a contingent or prospective one.

"liability" means a liability, duty or obligation, including a contingent or prospective one. 49 Section 4 of the Act provides that the Act binds the Crown in right of the Commonwealth and each of the States. 50 The other most relevant sections are ss.7, 9, 11, 12 and 28. Those sections are as follows: 7(1) The Minister for Finance and Administration may, by notice in the Gazette, declare that this section applies to network facilities specified in the notice. (2) At the end of the day on which the notice is published, any specified network facility that is a fixture on non-Commonwealth land: (a) is severed from the land and remains severed; and (b) vests in the Commonwealth; by force of this section. (3) In this section: "network facility" means any asset used, or formerly used, by the Commonwealth in connection with the transmission of a broadcasting service. "non-Commonwealth land" means land not owned by the Commonwealth.

9(1) The Minister for Finance and Administration may, by notice in the Gazette, declare all or any of the following, in relation to a company specified in the notice: (a) a specified Commonwealth asset vests in the company at a time specified in the notice (the transfer time), without any conveyance, transfer or assignment; (b) at the transfer time, the company becomes the Commonwealth's successor in law in relation to the transferred asset; (c) a specified instrument relating to the transferred asset continues to have effect after the transfer time as if a reference in the instrument to the Commonwealth or to the National Transmission Agency were a reference to the company. (2) The Minister for Finance and Administration may, by notice in the Gazette, declare all or any of the following, in relation to a company specified in the notice: (a) a Commonwealth liability specified in the notice ceases to be a Commonwealth liability at a time specified in the notice (the transfer time) and becomes a liability of the company; (b) at the transfer time, the company becomes the Commonwealth's successor in law in relation to the transferred liability; (c) a specified instrument relating to the transferred liability continues to have effect after the transfer time as if a reference in the instrument to the Commonwealth or to the National Transmission Agency were a reference to the company. (3) Declarations in relation to both assets and liabilities may be included in the same notice. The same notice may include declarations in relation to more than one asset or liability. (4) A declaration under this section has effect according to its terms. Note: The assets and liabilities that can be transferred under this section include assets and liabilities that consist of rights and obligations under contracts.

11(1) This section applies if: (a) any right, title and interest in particular land vests in a company under this Act; and (b) there is lodged with a land registration official a certificate that: (i) is signed by an authorised person; and (ii) identifies the land, whether by reference to a map or otherwise; and (iii) states that the right, title and interest has become vested in the company under this Act. (2) The land registration official may: (a) register the matter in a way that is the same as, or similar to, the way in which dealings in land of that kind are registered; and (b) deal with, and give effect to, the certificate. (3) A document that appears to be a certificate under subsection (1) is taken to be such a certificate, and to have been properly given, unless the contrary is established. (4) In this section: "authorised person" means: (a) the Minister for Finance and Administration; or (b) a person authorised by the Minister for Finance and Administration, in writing, for the purposes of this section.

12 The operation of this Part is not to be regarded as: (a) placing a person in breach of contract or confidence; or (b) otherwise making a person guilty of a civil wrong; or (c) placing a person in breach of any contractual provision prohibiting, restricting or regulating: (i) the assignment or transfer of any asset or liability; or (ii) the disclosure of any information; or (d) releasing any surety from any of the surety's obligations in relation to a liability that is transferred to a company under this Part.

28(1) If: (a) apart from this section, the operation of this Act would result in the acquisition of property from a person otherwise than on just terms; and (b) the acquisition would be invalid because of paragraph 51(xxxi) of the Constitution; the Commonwealth is liable to pay the person a reasonable amount of compensation in respect of the acquisition. (2) If the Commonwealth and the person do not agree on the amount of the compensation, the person may institute proceedings in the Federal Court of Australia for the recovery from the Commonwealth of such reasonable amount of compensation as the court determines. (3) In this section: "acquisition of property" has the same meaning as in paragraph 51(xxxi) of the Constitution. "just terms" has the same meaning as in paragraph 51(xxxi) of the Constitution. 51 The declaration made on 29th April 1999 pursuant to s.9 of the Network Sale Act was in the following terms: DECLARATION DECLARATION MADE BY THE MINISTER FOR FINANCE AND ADMINISTRATION UNDER THE NATIONAL TRANSMISSION NETWORK SALE ACT 1998

1. DEFINITIONS AND INTERPRETATIONS 1.1 Definitions Words and phrases used in this notice which are defined in the National Transmission Network Sale Act 1998 have the same meaning when used in this instrument. In addition: Company means National Transmission Company Pty Limited, ACN 086048562.

Specified Asset means an asset specified in Part 1 of Schedule A, but does not include an asset specified in Part 3 of Schedule A.

Specified Instrument means an instrument specified in Part 2 of Schedule A, or Part 2 of Schedule B, but does not include an instrument specified in Part 4 of Schedule A or Part 4 of Schedule B.

Specified Liability means a liability in Part 1 of Schedule B, but does not include a liability specified in Part 3 of Schedule B.

1.2 Interpretation Unless the context otherwise requires, references to Schedules are references to Schedules to this instrument.

2. DECLARATIONS I, John Joseph Fahey, Minister for Finance and Administration, hereby declare, pursuant to the National Transmission Network Sale Act, that at the Transfer Time:

2.1 Section 9(1) (Assets) (a) Each Specified Asset vests in the Company without any conveyance, transfer or assignment; (b) The Company becomes the Commonwealth's successor in law in relation to each Specified Asset; and (c) Each Specified Instrument relating to a Specified Asset continues to have effect after the Specified Asset vests in the Company as if a reference in the instrument to the National Transmission Agency or to the Commonwealth were a reference to the Company.

2.2 Section 9(2)(Liabilities) (a) Each Specified Liability ceases to be a liability of the Commonwealth and becomes a liability of the Company; (b) The Company becomes the Commonwealth's successor in law in relation to each Specified Liability; and (c) Each Specified Instrument relating to a Specified Liability continues to have effect after the Transfer Time as if a reference in the instrument to the National Transmission Agency or to the Commonwealth were a reference to the Company. 52 Part 1 of Schedule A included the following paragraph, under the heading "Properties": Subject to the limitations described at the end of this Part 1 of Schedule A, any legal or equitable estate or interest or right or entitlement which the Commonwealth has in, or in relation to, the following sites.

There were then set out a large number of sites, including one numbered 2079 with the name "Mt. Sugarloaf" and title description "F/I 22/223395". It is common ground that that is the site the subject of the permissive occupancy under consideration in this appeal. 53 Part 2 of Schedule A was as follows: Instruments, licences and contracts Any right of the Commonwealth (including a prospective or contingent right) in respect of, in relation to or which arises from any instrument, licence, contract or other legally binding arrangement which: (a) the Commonwealth is a party to; and (b) was entered into by the Commonwealth for the purposes of the ownership or operation of the National Transmission Network, other than: (c) the memorandum between Telstra Corporation Limited and the Commonwealth in relation to the provision of communications services; (d) any other contracts entered into by the Commonwealth for the provision of goods or services across a number of Commonwealth departments or agencies. including the NTA.

DECISION OF PRIMARY JUDGE 54 The primary judge first considered the characteristics of the permissive occupancy, and held that it was a personal licence, revocable by the licensor at any time: Barrow v. Brooksby (1958) 37 LVR 14; Minister for National Resources v. NSW Aboriginal Land Council (1987) 9 NSWLR 154 at 161; Southern Estates Pty. Limited v. Aboriginal Land Council (1991) 24 NSWLR 320 at 324. Accordingly, it could not be assigned at general law: Re Davis & Co., Ex Parte Rawlings (1888) 22 QBD 193; R v. Toohey, Ex Parte Meneling Station Pty. Limited (1983) 158 CLR 327. 55 The primary judge then considered the effect of the declaration under the Network Sale Act, having regard to the purpose of that statute. She noted that the definition of "asset" in s.3 included rights of a personal nature, and that s.9 provided for declarations having the effect that a specified Commonwealth asset "vests" in a company; and she held that this was effectual in respect of a personal licence, even though such licence was not assignable at general law.

SUBMISSIONS ON APPEAL 56 Mr. Coles QC for the Minister submitted that the permissive occupancy was a personal licence, or at most a tenancy at will, and therefore not transmissible: R. v. Toohey. Although the word "asset" was defined widely by the Network Sale Act, that Act disclosed no intention otherwise than to take assets as it found them and deal with them in accordance with their ordinary incidents, and not to enlarge them or to create new rights. Accordingly, where as here an asset is not transmissible, but comes to an end when a grantee attempts to transfer and gives up possession, the company referred to in a declaration does not end up with the benefit of a licence or tenancy for its benefit. The asset in question was one whereby the Commonwealth, and no-one else, was permitted to occupy land; so that all that the company could get was an asset permitting the Commonwealth to occupy land, which in any event came to an end when the Commonwealth gave up occupation (or at least when the owner had notice of this: Pinhorn v. Souster (1853) 8 Exch. 763 at 772-3) 57 Mr. Coles submitted that even a tenancy was not assignable, if terminable at will: Anderson v. Tooheys Limited (1937) 37 SR(NSW) 70. The position of a licence was a fortiori: although an estate in land may be assignable even if the tenant is bound by a covenant against assignment, a personal contract containing a provision against assignment is wholly unassignable: Linden Gardens Trust Limited v. Lenesta Sludge Disposals [1994] 1 AC 85 at 108. That case showed that the impossibility of assignment was not just because assignment would involve a breach, which might be overcome by s.12 of the Network Sale Act, but rather was one of outright non-assignability. 58 Mr. Coles submitted that paragraphs (b) and (c) of s.9(1) could not help. They only applied if there was a "transferred asset", showing that there needed first to be an asset capable of transfer. 59 Mr. Downes QC for NTL submitted that the permissive occupancy was capable of transfer. Condition 6 of the permissive occupancy, prohibiting transfer without prior consent of the Minister, showed that it was transferable so long as prior consent was obtained. This was confirmed by the provision for yearly rent in advance, in Condition 1. The permissive occupancy was not subject to the will of both parties: there was no right in the tenant to terminate and thereby escape liability, for example liability under Condition 7, or to obtain a refund of rent. Mr. Downes submitted that it was the clear intention of the Network Sale Act to give the company in question benefit of all rights, including privileges and immunities, which the Commonwealth had. As required by s.15AA of the Acts Interpretation Act 1901 (Cwlth), the clear purpose of the Act should be given effect to. 60 Mr. Downes also relied on a submission in a Notice of Contention, filed by leave, to the effect that the Minister had in fact consented to the vesting of the permissive occupancy in NTL. Mr. Downes relied on an admission constituted by NTL's Points of Defence, which admitted that at material times NTL occupied the site pursuant to permissive occupancy 61/66 under the Continued Tenures Act; and also relied on correspondence, notably a letter dated 18th September 1998 from the Department of Land and Water Conservation, referring inter alia to an offer to the National Transmission Authority of licences over its holdings. 61 Mr. Coles QC in reply submitted that the Network Sale Act did not disclose an intention to create any new right; and if it had done so, they would be rights stemming from Federal law, and not within the jurisdiction of the Land & Environment Court.

DECISION 62 Dealing first with the nature of the Commonwealth's rights under the permissive occupancy, these were statutory rights, whose nature and incidents depend upon the provisions of the relevant statutes rather than the nature and incidents of general law categories such as leases and licences, except to the extent that the statutory provisions and the terms of instruments authorised by them disclose an intention to incorporate general law categories. 63 The words "permissions to occupy" in s.136K of the Crown Lands Consolidation Act are perhaps more suggestive of licence than lease, but these "permissions" may be "on such terms and conditions as to [the Minister] seem fit"; and there is no suggestion that the conditions of the Commonwealth's permissive occupancy are not authorised by those words. Those conditions, in my opinion, despite the contrary view tentatively expressed in Barrow v. Brooksby at 17 and adopted by McHugh JA in Minister for Natural Resources v. NSW Aboriginal Land Council at 161, are suggestive more of tenancy than of licence. 64 The word "occupy" suggests possession, and this is confirmed by Condition 6 referring inter alia to sub-letting and parting with possession. It is not necessary to decide whether the permissive occupancy grants exclusive possession: it is in any event terminable at the will of the Minister. It is not clear whether or how it is terminable by the tenant. If a tenant goes out of occupation or does not pay rent, it is likely that the Minister would terminate it; but if the Minister does not do this, it is not clear that the tenant could escape continuing liability, including liability to pay rent for subsequent years or liability under Condition 7. 65 In my opinion, although licences and tenancies at will are not assignable at general law, Condition 6 makes it clear that the rights under the permissive occupancy can be transferred, so long as the prior consent of the Minister is obtained. If this happens, the result is not a new permissive occupancy, but a continuation of the existing permissive occupancy with a new tenant. In my opinion, that remained possible even after the commencement of the Crown Lands Act 1989, which precluded the grant of new permissive occupancies. 66 Associated with the permissive occupancy are whatever consequences may come from paying rent annually in advance. In my opinion, payment of a year's rent in advance cannot prevent the Minister terminating the permissive occupancy at will during that year: this is made clear both by the Continued Tenures Act and Condition 3 of the permissive occupancy. However, it may be that if the Minister did do this, the tenant would have a claim for a pro tanto refund of rent. There might possibly be a claim for damages if the termination was without justification: it must be taken into account that the Crown Lands Consolidation Act authorised the grant of permissive occupancies for purposes such as mining, so it may be that the provision that a permissive occupancy is terminable at will would not protect the Crown in right of the State of New South Wales from being subject to a damages claim if the permissive occupancy was terminated without any justification, particularly during a year for which rent had been paid. 67 Turning to the effect of the Network Sale Act, there is no doubt that "asset" is defined widely enough in s.3 to include the rights (including privileges and immunities) under the permissive occupancy. The word "vest" in s.9 is apt to provide for the effect that the Commonwealth assets specified in a declaration become assets of the relevant company. The circumstance that this process is referred to as a transfer in the words "transfer time" and in the reference to "transferred assets" does not mean that the process whereby the Commonwealth assets become assets of the company must be considered as having all the limitations and restrictions that may attach to the legal concept of transfer. Paragraphs (b) and (c) of s.9(1) make it clear that the Act has the purpose and intention that the company in question be able to do anything that the Commonwealth could previously have done in reliance on the asset in question. 68 A transfer by the Commonwealth of the permissive occupancy without the prior consent of the Minister would be a breach by the Commonwealth of Condition 6 of the permissive occupancy; but s.12 of the Network Sale Act provides that the process whereby the asset of the Commonwealth becomes an asset of the company is not to be considered as placing the Commonwealth in breach of any contractual provision. In my opinion, the words "contractual provision" in s.12 should not be construed narrowly, and are wide enough to include terms of a permissive occupancy such as Condition 6. 69 Mr. Coles submitted that that did not make something transferable which was not transferable. The Linden Gardens case showed that, where a contract prohibits a transfer of contractual rights, an attempted transfer of those rights is not merely a breach of contract, but is wholly ineffectual. Mr. Coles submitted that s.12 might overcome the former, the matter of breach, but not the latter, the inherent non-transferability 70 In my opinion, the plain intention of the Network Sale Act, and in particular ss.9 and 12 of that Act, is to put the company in question in a position to enjoy all rights which the Commonwealth enjoyed under assets like this permissive occupancy; so that the vesting of such an asset is to be as effective as if it did not involve any breach of the terms of the permissive occupancy, that is, as effective as if it was a transfer with the prior consent of the Minister. 71 Having regard to that view, it is not necessary to decide whether or not the Act would apply if the permissive occupancy had not been made assignable with the consent of the Minister. I am inclined to think that it still would have been effectual. The intention that in all respects the company should be in precisely the same position as the Commonwealth had been is made very clear; and is further confirmed by the provision referring to liabilities. Liabilities are not assignable at general law at all, yet the substitution of the company for the Commonwealth in respect of liabilities is plainly provided by s.9. 72 I accept that this means that, in some sense at least, new rights are created in the company by the Network Sale Act: they are rights that would not have existed but for the Act, in that, but for the Act, they could not have arisen without the prior consent of the Minister. However, in so far as they are new rights, they nevertheless have precisely the same incidents as the permissive occupancy, and they are the same as if the permissive occupancy had been transferred to the company with the prior consent of the Minister. If this should be regarded as being an acquisition of property by the Commonwealth, then s.28 of the Network Sale Act provides for just terms; although it is unlikely that any compensation would be appropriate, in circumstances where the Minister can terminate the permissive occupancy at will anyway. 73 In so far as the Network Sale Act in effect deems rights which it creates to be the same as rights under the permissive occupancy itself, and thus to be rights in respect of which the Land & Environment Court has jurisdiction, it can be said that the Network Sale Act is in substance conferring jurisdiction on the Land & Environment Court. I see no problem with this, so long as the legislation is within Commonwealth power. In my opinion, the legislation clearly is within the "post and telegraphs" power in s.52(v) of the Constitution: cf. Jones v. The Commonwealth (No.2) (1965) 112 CLR 206. 74 I do not need to decide the question raised by the Notice of Contention. However, I do not think the letters referred to could amount to a prior consent by the Minister to a transfer of the permissive occupancy. The Points of Defence themselves could not be a prior consent. NTL has not attempted to rely on the Points of Defence as a binding and irrevocable admission, and NTL has applied to amend in order to remove the admission. In those circumstances, I do not think the Notice of Contention could have succeeded. 75 I also note that there is no need to decide the question of the jurisdiction of the Land & Environment Court to decide the question. However, I would make the following comments. The redetermination appealed from related to rent payable from 1st July 1999, and the Continued Tenures Act provided that the Court may substitute its own redetermination of rent, that such substituted redetermination had effect instead of that for which it was substituted, and that the Court should take into account inter alia the terms to which the permissive occupancy was subject and the duration of time for which the rent would be payable. In those circumstances, it seems clear that it was necessary for the Land & Environment Court to decide whether or not the permissive occupancy was still in existence on 1st July 1999, in order to determine the appeal; and thus that it had jurisdiction to determine whether or not the permissive occupancy had terminated on 29th April 1999. 76 For the reasons I have given, in my opinion the appeal should be dismissed with costs. **********

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