Blythe v Willis

Pleading Issues

1. Shortly before the commencement of the hearing, Stan Muzica sought leave to file an amended cross-claim seeking a declaration that Mrs Willis, her heirs and successors, together with Stan Muzica, are entitled to an equitable right of carriage way over part of the Blythe land described as "the waterfront track" and an order requiring Mrs Blythe to transfer to Mrs Willis an easement in accordance with the plan annexed. He claimed, in the alternative, the same order under s 88K as he claimed in the original Cross-Claim.
2. The basis for the declaration claimed by Stan Muzica in the proposed amended cross-claim was an alleged estoppel. It was proposed to allege that:

• Stan Muzica acted under the assumption that he and Geraldine Muzica, his late wife, prior to her death, had a general right of carriageway in relation to the land described as "the waterfront track" (the Assumption);
• to the knowledge of Mrs Blythe, Stan Muzica had acted or abstained from acting in various ways (the reliant activity) in reliance on the Assumption; and
• Mrs Blythe and her predecessor in title, Stuart Property Investments Pty Ltd (Stuart Property), had induced Stan Muzica to adopt the Assumption, had encouraged or acquiesced in the reliant activity by him and had failed to deny the validity of the Assumption with knowledge that he was relying on the Assumption to his potential detriment.

1. The draft amended cross-claim was deficient in a number of respects. One difficulty was the allegation that the late Geraldine Muzica was alleged to have had an interest that would make her legal personal representative a necessary party. In the course of argument on Stan Muzica's application for leave to amend, he applied for an adjournment of the hearing to enable the deficiencies to be rectified and to enable him to adduce evidence in support of the allegation of an equitable estoppel. No evidence was adduced to explain why such an application was made at such a late stage. The adjournment was opposed and was refused.
2. In those circumstances, there was no claim on behalf of Stan Muzica to be entitled to any equitable right of carriageway over the Blythe land and there was no basis for Stan Muzica to resist the declarations claimed in the Statement of Claim. However, the claims for damages for slander of title and trespass against Stan Muzica and Karl Muzica continued to be resisted by them.
3. Later during the course of the hearing, Stan Muzica sought leave to file an alternative amended cross-claim by which he joined Mrs Willis as a cross-defendant. Otherwise, the relief claimed and the pleadings were in the same terms as in the Cross-Claim originally filed. It appears that Mrs Willis no longer has the capacity to deal with her own affairs and it was intimated to the Court on behalf of Stan Muzica that a submitting appearance to the alternative proposed amended cross-claim would be filed on behalf of Mrs Willis by her daughter, who has an enduring power of attorney. There was brief evidence from the solicitor for Stan Muzica to the effect that he had spoken to the attorney, who had indicated that she did not wish to be involved in the proceedings and did not wish to incur any liability for costs on behalf of her mother.
4. It may be doubted as to whether that evidence by Stan Muzica's solicitor is sufficient to give Stan Muzica standing to bring the proceedings in circumstances where Mrs Willis is the registered proprietor of an estate in fee simple in the Willis land and Stan Muzica has no legal interest in the Willis land. He claims that he has an equitable interest in part of the Willis land and is entitled to make the claim under s 88K against Mrs Willis as trustee of that part.
5. Stan Muzica claims that he and his late wife, Geraldine, who was a daughter of Mrs Willis, entered into an agreement with Mrs Willis under which they were to purchase what was described as "the bottom part" of the Willis land. A copy of a deed dated 4 February 2008 between Mrs Willis, on the one hand, and Stan and Geraldine Muzica, on the other, recited that, in 1988, an amount of $400,000 was paid to Mrs Willis and her late husband by Stan and Geraldine Muzica "by way of their 'purchase' of part of the [Willis land] being the 'waterfront' part". Mrs Willis acknowledged receipt of the sum of $400,000 and the parties to the deed agreed that, once a formal sub-division could be registered, title to "the lower block" would be the property of Stan and Geraldine Muzica and the title to "the upper block" would remain with Mrs Willis. There was no other identification of either "the waterfront part" or "the lower block". Having regard to the conclusion that I have reached in relation to the substance of the application under s 88K of the Conveyancing Act, is it unnecessary to resolve the question of whether Stan Muzica has standing to apply for such an order.

The Blythe land and the Willis land

1. Prior to 1978, the Blythe land and the Willis land were together part of a larger parcel of land having a frontage to Maroopna Road, Yowie Bay. In September 1980, a deposited plan was registered whereby that original parcel was divided into three lots. Lot 1 is not presently relevant. Lot 2 is the Blythe land and Lot 3 is the Willis land. The Willis land has the benefit of a right of way giving access to Kiwong Street. The Blythe land has a frontage to Maroopna Road. By a plan registered on 4 May 1981, an easement for right of way was created over the Willis land in favour of the Blythe land (the Blythe Right of Way).
2. For some years there has been a driveway running from Maroopna Road through the Blythe land into the Willis land, over that part of the Willis land affected by the Blythe Right of Way, then back into the Blythe land and then down to a boat shed on the Blythe land (the Willis Boatshed). That part of the driveway from Maroopna Road to the end of the right of way was sealed in September and October 1980. From the point where the driveway re-enters the Blythe land, the driveway leading to the Willis Boatshed is unformed. The unsealed part of the driveway is referred to as "the waterfront track". Over a number of years, attempts have been made to improve the unformed surface of the waterfront track with concrete, pavers and other materials. Many of those attempts were made and carried out by Stan Muzica.
3. Geraldine and Stan Muzica were married in the early 1970s. They moved into the Willis Boatshed in around 1990 and resided there for some time. There is pedestrian access on the Willis land down to the Willis Boatshed. As will be described later, there is some question as to whether it would be possible to construct vehicular access to the Willis Boatshed.
4. There was undisputed evidence of an occasion when Geraldine Muzica came to the door of the home on the Blythe land and spoke to Mrs Blythe's late husband, saying that she wanted to use the waterfront track to access the Willis Boatshed rather than using the steps on the Willis land.
5. After Geraldine Muzica died, approximately eight years ago, Stan Muzica moved out of the Willis Boatshed and Karl Muzica and his wife, Natalie, later moved into the Willis Boatshed. They moved out in late 2016.

Sale of the Blythe Land and the Dispute

1. In 2014, Mrs Blythe and her son, Christopher Blythe, arranged for a development application to be lodged with Sutherland Shire Council, seeking approval for the sub-division of the Blythe land into six lots. Mrs Blythe intended to sell the Blythe land once subdivision approval had been obtained. However, in early 2016, Mrs Blythe decided to sell the Blythe land without subdivision approval. On 14 March 2016, after the Blythe land was open for inspection, Stan Muzica telephoned Christopher Blythe and said that he would "go legal" over the Blythe Right of Way.
2. On 23 March 2016, Mrs Blythe entered into a contract (the Contract) for the sale of the Blythe land to Ms Melissa-Anne Townsend-Cryer (the Purchaser). The Contract provided for a sale price of $7,150,000 with a deposit of $715,000.
3. On 24 March 2016, Messrs Beazley Boorman, solicitors for Stan Muzica, wrote to Mrs Blythe relevantly saying as follows: "We note your property is for sale. We place you on notice of a dispute between our client and yourself concerning the paved driveway which runs in a snake like fashion through our client's property into your property and ends at the water line. Our client has built, maintained and used the driveway over the last 25 years. Our client has existing use rights in respect of the drive way [sic] through your property. We note the only part of the right of carriage wary [sic] registered is that which runs through our client's property. Unless you agree to record the right of carriageway through your property on title, we intend to commence proceedings to have the existing use rights enforced. The alternative is, to extinguish the carriageway through our client's property. Please reply within 7 days or we shall have no alternative but to commence proceedings. You will now need to disclose this dispute to any purchaser of your property."
4. Mr Muzica acknowledged in cross-examination that he was aware of the contents of that letter when it was sent. Indeed, on the same day, an email was sent in his name by his de facto spouse addressed to the selling agents involved in the sale to the Purchaser.
5. On 4 April 2016, Peter Williams, solicitor, replied on behalf of Mrs Blythe to the letter from Messrs Beazley Boorman, saying, relevantly, as follows: "… Please note that my client had already exchanged Contracts for the sale of her property. My client instructs me that your client is not entitled to any alleged existing use rights over any access road traversing my client's property. My client will not be granting your client a right of carriageway over any part of my client's property, nor will she agree to release the right of way registered over the title to [the Willis land]. I also have instructions to require your client's written confirmation, no later than 5.00 pm on Friday 8 April 2016, that your client will not be pursuing his purported claim and it is withdrawn. In the meantime, my client holds your client responsible for any damages she suffers as a result of your client's purported claim."
6. On 27 April 2016, Mr Williams wrote again to Beazley Boorman noting that no response had been received to the letter of 4 April 2016. Mr Williams said, amongst other things, that Mrs Blythe would withdraw permission for access through the Blythe land and that, in the meantime, she continued to hold Stan Muzica responsible for any damages she might suffer as a result of his purported claim to a right of way.
7. Mr Williams wrote to Mrs Willis on 22 September 2016, saying that he was acting for Mrs Blythe and that she was in the process of selling the Blythe land. He said that he had been instructed that, for some years, Mrs Blythe had allowed Mrs Willis and members of her family informal access over the waterfront track on the Blythe land. The letter then said: "My client is now withdrawing that consent. She is asking that you cease using the track from 5.00 pm on Wednesday 28 September 2016. After that time she intends to erect a fence which will mean that future access to the track will not be possible."
8. Beazley Boorman responded on 28 September 2016 relevantly saying as follows: "Our client has had for the last 25 years existing use rights over your client's property in a similar way [sic] your client has had access through our client's property. Your client cannot simply withdraw consent. The boat shed [sic] at the bottom of our client's property is presently occupied by our client's children and their family. Mrs Natalie Muzica is pregnant and the access road used by our client in and out of the bottom of the property has been used and maintained by our client. … Should the fence be built, we shall seek an order for its removal or a gate to be installed allowing our client continued access. In addition to the above, our client will seek costs and interest." The letter also contained a threat that, should construction of the "alleged fence" commence, an application would be made to the Supreme Court for orders restraining such a fence from being built.
9. On 4 October 2016, Beazley Boorman wrote again to Mr Williams noting that a gate had been erected and locked with a padlock. The letter went on to say as follows: "Your client well knows the family history of the Property recently sold by your client and the adjoining land. Your client well knows the existing use which have been [sic] in use for generations and that the installation of a locked gate across the access road to the bottom of our client's property stops any vehicular access to the inhabited dwellings. A pregnant woman lives in the boat house [sic]. Should your client's actions endanger the life of the mother or her child, your client will be held accountable to the full extent of the law, both civilly and criminally. Unless your client provides a key forthwith to the padlock, our client will have no choice but to remove the lock and or chain and or the gate in the short term and seek the intervention of the Courts in the long term." By letter of 14 October 2016, Beazley Boorman said that they had no choice but to commence proceedings in the Supreme Court.
10. On 29 April 2016, Christopher Blythe spoke to Karl Muzica saying: "After we have gone, our permission goes with us. You can't expect the new buyer to let you use the waterfront track." On 22 September 2016, Christopher Blythe had another conversation with Karl Muzica, in which he asked him what he had said to the Purchaser. Karl Muzica replied, saying that they only wanted to use the waterfront track until after Christmas when they could move out.
11. In late September 2016, Christopher Blythe arranged for the installation of gates across the waterfront track just past the point where it crossed back into the Blythe land. The gates were locked with a padlock and chain. Shortly after the gates were installed, Karl Muzica cut through the chain. Christopher Blythe replaced the chain on two occasions and each time it was cut through again. On 4 December 2016, Christopher Blythe found the gatepost sheared off at ground level.
12. On 19 October 2016, Christopher Blythe arranged for four two-tonne concrete blocks to be placed on the waterfront track. The blocks effectively prevented vehicular access onto the waterfront track from the Willis land. Following that time, vehicles have been parked on the Willis land in front of the blocks, but Stan Muzica and others continue to use the waterfront track for pedestrian access to the Willis Boatshed. In February 2017, visitors to the Willis Boatshed walked up and down the waterfront track.
13. On 15 September 2016, Mr Williams received from the Purchaser's solicitors a notice of rescission of the Contract (the Rescission Notice). The Rescission Notice asserted that, after the Purchaser entered into the Contract, an ongoing dispute as to the rights attaching to the Blythe land had become apparent and that that dispute gave rise to a right on the part of the Purchaser to rescind the Contract. A covering letter also asserted that Stan Muzica's claim was of a character that would give rise to "a private right or accommodation track". The letter asserted that such a characterisation was a latent defect in circumstances where the Purchaser had not been given the right to view the use of the "carriageway/accommodation track" in the way that gave rise to a private use right. Alternatively, it was asserted, that the failure of Mrs Blythe to disclose "the nature and character of the right of carriageway" constituted a contravention of the Australian Consumer Law. Thus, it was fairly apparent that the claims made by Stan Muzica led to the action of the Purchaser in purporting to rescind the Contract. That fact is not seriously in dispute in these proceedings.
14. On 26 September 2016, Mr Williams arranged for a notice to complete the Contract to be given to the Purchaser. On 14 October 2016, he caused a notice of termination of the Contract to be given to the Purchaser.
15. On 3 March 2017 the Purchaser filed a statement of claim seeking a declaration that the Rescission Notice was valid and a declaration that she was entitled to rescind the contract as at the date of the Rescission Notice . The Purchaser also sought an order that the deposit of $715,000 be returned to her and an order for damages. On 29 May 2017, the Purchaser filed an amended statement of claim seeking, in the alternative, an order that the deposit be returned to her pursuant to s 55(2A) of the Conveyancing Act and an order for damages.
16. On 17 March 2017, Mrs Blythe filed a cross-claim in the proceedings brought by the Purchaser seeking a declaration that, by notice dated 14 October 2016, she had terminated the Contract and a declaration that the deposit of $715,000 had been forfeited. Those proceedings were fixed for hearing at the same time as the proceedings brought by Mrs Blythe against Mrs Willis and Stan and Karl Muzica. On 5 May 2017, orders were made by consent that the deposit payable under the Contract be paid into Court.
17. The proceedings between Mrs Blythe and the Purchaser were settled shortly before the date fixed for hearing and orders were made for the amount that had been paid into Court to be paid out to Mrs Blythe and the Purchaser. The sum of $250,000 was paid to the Purchaser and the balance, together with all accrued interest, was paid to Mrs Blythe. Thus, Mrs Blythe received a sum of at least $465,000 as a consequence of the termination of the Contract.

Mrs Blythe's Claims for Damages

1. Following the making of the Contract, Mrs Blythe borrowed $1.1 million to pay a residential bond so that she could move into her current accommodation. She expected to repay that loan following settlement of the Contract from the proceeds of sale. Because the Contract was not completed, the expected proceeds of sale were not available to repay the loan and Mrs Blythe has incurred interest on the loan from October 2016, when she hoped to complete the Contract, to date. As at August 2017, she had paid $56,909.15 in interest and interest continues to accrue on the loan at the rate of about $5,000 per month.
2. On 27 July 2016, Christopher Blythe and his wife, Kylie Blythe, entered into a contract to buy a property at Woronora Heights for the price of $1,110,000. On that day, Stuart Property provided a cheque for the deposit in the sum of $111,000 to the vendor's agent on the sale of the Woronora Heights property. Mrs Blythe said that she intended that that amount would be repaid to Stuart Property from the proceeds of the sale of the Blythe land. The contract for the purchase of the Woronora Heights property was due to be completed on 23 September 2016. On 26 September 2016, the vendor gave a notice to complete to Christopher and Kylie Blythe. Mrs Blythe says that, because the Contract was not completed, the proceeds of sale were not available and Christopher and Kylie Blythe were not able to comply with the notice to complete. On 13 October 2016, the vendor of the Woronora Heights property gave notice of termination and forfeited the deposit of $111,000.
3. As noted above, Mrs Blythe claims damages from Stan Muzica for slander of title and trespass and against Karl Muzica for trespass. There is no longer any dispute concerning the trespass by both Stan Muzica and Karl Muzica. The only question is the extent of any award of damages that should be made in respect of the trespass. However, there is a question as to whether or not Mrs Blythe is also entitled to damages for conduct of Stan Muzica alleged to have constituted slander of title.

Slander of Title

1. The allegations made in the Statement of Claim may be restated as follows:

• On 23 March 2016, Mrs Blythe entered into the Contract;
• On 24 March 2016, Stan Muzica falsely alleged that he had an enforceable legal or equitable right to use the "road" over the Blythe land for pedestrian and vehicular access to the Willis Boatshed;
• Between March and August 2016, Stan Muzica published the false allegation to the Purchaser and to her legal representatives intending that it be conveyed to the Purchaser;
• Stan Muzica published the allegation knowing that Mrs Blythe had entered into the Contract and intending that the publication would cause the Purchaser to withdraw from or not to complete the Contract or would otherwise interfere with completion of the sale;
• On 15 September 2016, the Purchaser alleged that Stan Muzica's allegation of a right to use the road was a defect in Mrs Blythe's title and a misrepresentation of Mrs Blythe's title over the Blythe land.
• Relying on those grounds, the Purchaser served a notice of rescission of the Contract on 15 September 2016;
• Since that date, the Purchaser has refused to complete the Contract;
• As a result, Mrs Blythe has suffered loss and damage.

1. In his defence to the Statement of Claim, Stan Muzica admits that he caused a letter to be written to Mrs Blythe asserting an existing use right over the Blythe land but denies that the assertion was false. He also denies publishing a false allegation about his right to use the road or that the Purchaser relied on his allegation in serving a notice of rescission of the Contract. However, he admits to speaking to a male person associated with the Purchaser after he was approached by that person.
2. The action for slander of title involves casting aspersions upon the plaintiff's ownership of land that results in the plaintiff being unable to lease or sell the land. The tort was recognised as an action on the case for special damage resulting from particular interference by the defendant. [1] The action now lies for written or oral falsehoods, that may not necessarily be actionable per se, where the falsehoods are maliciously published, are calculated in the ordinary course of things to produce and do in fact produce actual damage. The action is an action on the case for damage wilfully and intentionally done without justification or excuse. [2]
3. Under the tort, the plaintiff is entitled to recover damages that are the direct and natural result of the conduct about which complaint is made. [3] If the harm was intentionally caused by the defendant, there is no difficulty in establishing legal causation because all intended consequences are legal and proximate. However, it will not necessarily be sufficient that the defendant intended damage different in kind from that which occurred. Where there is a finding that the defendant intended a certain consequence, the issue of whether the defendant should be liable for a consequence different in kind will depend largely upon the relationship of that which the defendant intends to the events that are, in fact, brought to pass by the alleged conduct. Such a relation is not constant and not always evident. It may be different either in respect of the event or of the person affected. That is to say, it will depend upon the relation of that which the defendant intended to the consequences that actually resulted. That relation will generally be assessed by asking whether the damage was the direct and natural result of the conduct complained of. [4]
4. Malice is an element of the tort, in the sense of an intent to injure another without just cause or excuse or by some indirect, dishonest or improper motive. Further, injury is also an element of the tort in keeping with the requirement that it can be shown that actual damage has been suffered as a result of the falsehood. Written or oral falsehoods that are maliciously published, that are calculated in the ordinary course of things to produce and that do produce actual damage will be actionable. Actual damage must be shown. [5]
5. In the events that have occurred, there is no real dispute that Stan Muzica published material that was false in so far as he asserted to the Purchaser that he had legal rights over the Blythe land in circumstances where it is difficult to accept that he had a genuine or rational basis for a belief that he had such rights. That falsity concerned the Blythe land and was calculated to induce the Purchaser not to deal with Mrs Blythe in relation to the Blythe land. The publication of the assertion by Stan Muzica had the result that the Purchaser repudiated the Contract.
6. However, there are two further requirements. The first is that the publication of the assertion by Stan Muzica was actuated by malice. The second is that the result of the publication was actual damage to Mrs Blythe that Stan Muzica intended or was the natural and probable result of such publication. [6] Stan Muzica contends that the evidence does not support a finding that the assertion about which complaint is made was actuated by malice. Further, he contends that, even if it were, the damage claimed by Mrs Blythe was not intended by him and was not the natural and probable result of his making the assertion in question.
7. It is clear enough that by making the relevant assertions, Stan Muzica intended to interfere with the proposed sale of the Blythe land to the Purchaser. He succeeded in that object. In cross-examination, Stan Muzica was asked what effect he intended by the statement in the letter of 24 March 2016 that Mrs Blythe would now need to disclose "this dispute to any purchaser". He somewhat disingenuously said that he did not intend any effect on a purchaser who was told of that assertion. He denied that he knew that the effect of such a statement would be to discourage purchasers. He asserted that that statement was included in the letter because he was hoping that Mrs Blythe would come to some agreement with him so that he could have access over the Blythe land to the Willis Boatshed. When asked whether he knew that the statement would discourage purchasers his response was that the Blythe land had already been sold. When asked whether it was his intention to interfere with the sale that had already been made, his response was that his intention was to have a meeting with Mrs Blythe. Thus, it is clear enough, that Stan Muzica's intention in making the assertions of right over the Blythe land was in order to put pressure on Mrs Blythe to negotiate with him in relation to the access that he required.
8. When asked whether he had sent a copy of his solicitor's letter of 24 March 2016 to the agent acting on the sale, he responded, again disingenuously, that it had not been sent by him. The email in question was sent in his name by his de facto spouse. When asked about this, he asserted that he could not remember. He was asked whether he sent the email to the selling agents to make sure that as many people as possible found out that he was making a claim over the Blythe land. His response was that he had "no idea".
9. Stan Muzica also asserted in cross-examination that he assumed he had a right to use the "waterfront track" over the Blythe land. When asked whether he believed that that was a permanent enforceable legal right his response was: "Not enforceable legal right. I had a right. … I don't know how you put an enforceable legal right, if you have right, I don't know." He was asked whether he ever saw a need to formalise his claim over the use of the track, whether he ever saw any need for a written agreement and whether he had ever lodged a caveat. His response was in the negative to each of those questions. He was asked whether the reason why he had done nothing was that he knew perfectly well that he did not have an enforceable legal right over the Blythe land. His response was: "That's why, because I don't know everything, I employ the learned solicitor to advise me because, as you said, I don't know everything."
10. Stan Muzica was subsequently asked whether he had ever believed that he had an enforceable legal right to use the track and his response was: "Never occurred to my mind." Later, he was asked whether he knew perfectly well that he did not have an enforceable right and that that was why he did not commence legal proceedings. His response was: "No, I was hoping they were going to come to sort of arrangement."
11. It is highly significant, in the context of those responses, that the letter of 24 March 2016 said that the alternative to commencing proceedings, if Mrs Blythe did not agree to record the right of carriageway on the title to the Blythe land, was to extinguish the Blythe Right of Way. There was no evidence that Stan Muzica or Mrs Willis had ever been granted an enforceable right of way over the waterfront track. To the contrary, there was evidence that Stan Muzica's daughter had sought permission from Mrs Blythe's late husband to use the waterfront track. There was also evidence that Geraldine Muzica begged the late Mr Blythe for permission to use the waterfront track. In those circumstances, it is difficult to conclude that Stan Muzica had a genuine belief that he had a legal right of carriageway or footway over the waterfront track.
12. I am satisfied that Stan Muzica caused statements to be made to the effect that he had a legally enforceable right in relation to the Blythe land in circumstances where there was no rational basis for such a belief. He made the assertions in question with the intention of interfering with the proposed sale of the Blythe land to the Purchaser in order to extract from Mrs Blythe some concession in relation to the Blythe Right of Way. That is sufficient to constitute the element of "malice" that is required for the tort. The important question is whether the loss and damage claimed by Mrs Blythe is loss and damage intended by Stan Muzica or is the natural and probable result of his conduct.
13. There is no basis for concluding that Stan Muzica intended that Mrs Blythe would pay additional interest on a loan or lose income from investment of the proceeds of sale under the Contract. However, a natural and probable result of the termination of a contract for sale is that the seller will lose the use of the proceeds of sale. That use might either be to repay indebtedness with the proceeds of sale or to invest the proceeds of sale in order to generate a return on the funds. Mrs Blythe's unchallenged evidence is that she would have applied the proceeds of sale of the Blythe land, if the Contract had been completed, in repaying a loan to Westpac and in assisting Christopher and Kylie Blythe to buy the Woronora Heights property.
14. To the extent that Mrs Blythe incurred interest or lost income after the time when the Contract would normally have been completed, that interest or income is the natural and probable consequence of the Contract not proceeding. The Contract not proceeding was a result sought by Stan Muzica.
15. However, I do not consider that the loss of the deposit of $111,000 was intended by Stan Muzica, nor was it the natural and probable consequence of the termination of a contract. The loss of income from investment of the balance of the sale proceeds over and above the amount paid by Mrs Blythe for her new accommodation might also have been the natural and probable result of the termination of the Contract. However, Mrs Blythe claims only interest on the $1,100,000 borrowed by her. It may well be that interest on the balance of the purchase price, in excess of $6 million, would have been the natural and probable result of termination. However, no such claim was made by Mrs Blythe.
16. The application for development consent for the proposed subdivision of the Blythe land was not pursued after Mrs Blythe entered into the Contract. However, following termination of the Contract, the development application was renewed and development consent has now been granted for the subdivision of the Blythe land into six lots. In his defence to the Statement of Claim, Stan Muzica asserted that, by reason of the sub-division, the Blythe land is now more valuable than it was at the time of the Contract with the Purchaser. However, no real attempt was made to explore the possibility that, as a consequence of a grant of development approval, Mrs Blythe may be able to realise more for the Blythe land than she would have received under the Contract with the Purchaser because she would have the benefit of any possible increase in the proceeds of the sale of the six lots. For example, there was no evidence that the present value of the Blythe land is greater than the price that was payable under Contract. While Mrs Blythe was asked about that question, her answer was of no assistance to Stan Muzica.
17. It is by no means clear that Mrs Blythe has lost the deposit of $111,000 that was paid on behalf of Christopher and Kylie Blythe. It appears that Mrs Blythe may have intended to make part of the proceeds of sale under the Contract available to Christopher and Kylie Blythe. However, there was no evidence as to the basis upon which the funds were to be made available to Christopher and Kylie Blythe. For example, it is unclear whether Mrs Blythe was intending to make a gift to them. Alternatively, it is unclear whether Christopher and Kylie Blythe would be in a position to repay the amount advanced if it was a loan.
18. Mrs Blythe gave no evidence as to the basis upon which she caused Stuart Property to pay the deposit on behalf of Christopher and Kylie Blythe. If it was a loan, there was no evidence that they would not be able to repay it. In that event, while they may have suffered a loss, Mrs Blythe has not. Unfortunately, the evidence as to the arrangements was given in a form which would not have been admissible had there been objection. However, there was no objection.
19. It appears that Mrs Blythe, in effect, borrowed the sum of $111,000 from Stuart Property on the basis that she would repay it. That seems to be the effect of the evidence to which I have referred. Of course, if Stuart Property advanced the money to Christopher and Kylie Blythe, there is no basis at all for suggesting that the loss of that sum was a loss suffered by Mrs Blythe. There is no evidence that Christopher and Kylie Blythe could not repay the sum of $111,000 to her if it was made by way of a loan. If it was paid by Mrs Blythe to them by way of gift, it could not be said that the loss of whatever benefit she may have received from making such a gift was the natural and probable consequence of the conduct of Stan Muzica about which she complains.
20. There was no evidence as to what, if any, attempts were made by Christopher and Kylie Blythe to borrow the balance of the purchase price paid by them. I do not consider that any loss that may have been suffered by Mrs Blythe in respect of that deposit was a natural and probable consequence of the conduct on the part of Stan Muzica about which Mrs Blythe complains. It is a long bow to draw to suggest that a natural and probable consequence was Christopher and Kylie Blythe's inability to raise the balance of the purchase price payable by them and their subsequent default under a contract to purchase a property, such that they lost the deposit paid and that that loss might be borne by Mrs Blythe, on whatever basis.
21. As I have indicated, the proceedings between Mrs Blythe and the Purchaser have been settled on the basis that $250,000 of the deposit of $715,000 forfeited by Mrs Blythe be returned to the Purchaser. That is to say, Mrs Blythe has received a not insignificant sum as a consequence of the termination of the Contract. That is a benefit that flowed to her as a consequence of the impugned conduct of Stan Muzica.
22. Stan Muzica contends that the amount of the deposit retained by Mrs Blythe should be brought to account in any assessment of damages for slander of title against him. Her forfeiture of the deposit arose as a consequence of non-completion of the Contract by the Purchaser, which was the intended result of the claims made by him. Mrs Blythe, on the other hand, contends that the benefit received from the forfeiture of part of the deposit has no effect whatsoever on the damages to which she is entitled from Stan Muzica.
23. The forfeiture of the deposit was something to which Mrs Blythe was contractually entitled under cl 9 of the Contract. A deposit under the general law is an "earnest" to bind the bargain. The potential forfeiture of a deposit affords a motive for a purchaser to perform the obligations under the contract. It is a part payment of the purchase price only if the purchaser completes the contract [7] . While the forfeiture of a deposit is not compensation for breach of contract, where a vendor sues a purchaser for damages arising from failure to complete a contract for the sale and purchase of land, the amount of forfeited deposit may be set off against the damages arising from the failure to complete [8] .
24. That is to say, damages for breach of contract are intended to put the plaintiff in the position in which the plaintiff would have been if the contract had been performed. There is no general principle that a forfeited deposit is compensation for loss suffered as a consequence of breach of contract. Nevertheless, I consider that, in assessing the loss that has been suffered by Mrs Blythe by reason of the consequences of Stan Muzica's conduct, in impugning her title, the benefit that she has derived from the termination of the Contract ought to be brought to account in determining the loss or damage that she has suffered as a consequence of that termination.

Trespass

1. The allegations of trespass made in the Statement of Claim may be summarised as follows:

• On 22 September 2016, permission to use the waterfront track was withdrawn;
• In September 2016, Mrs Blythe had a gate installed on the Blythe land near the boundary between the Blythe land and the Willis land;
• On 4 October 2016, Karl Muzica entered the Blythe land without Mrs Blythe's permission or consent, cut the chain, thereby causing damage to Mrs Blythe's property and opened the gates and used, and continued to use, the waterfront track over the Blythe land without Mrs Blythe's permission or consent;
• On further occasions in October 2016, Karl Muzica entered the Blythe land without Mrs Blythe's permission or consent, forced open and damaged the gates and used, and continued to use, the waterfront track over the Blythe land without Mrs Blythe's permission or consent;
• On 19 October 2016, Mrs Blythe had concrete blocks installed on the Blythe land near the boundary between the Blythe land and the Willis land;
• Despite the installation of gates and concrete blocks, Stan Muzica, Karl Muzica and their families and invitees have continued to come onto the Blythe land and to use the waterfront track without Mrs Blythe's permission or consent;
• On 20 November 2016, Mrs Blythe, by her agent Christopher Blythe, asked Karl Muzica not to use the waterfront track;
• In December 2016, contractors acting on behalf of Stan Muzica cut down trees and bush on the Willis land and dumped cut timbers and green waste on the Blythe land without Mrs Blythe's permission or consent.

1. The acts alleged to have constituted trespass have clearly been established. The only question is the measure of damages to which Mrs Blythe is entitled.
2. There is evidence that the cost of the gate and fence and the concrete blocks was $5,391.10. It was not suggested that any distinction should be drawn between Stan Muzica and Karl Muzica in relation to damages for trespass. Mrs Blythe is entitled to be compensated at least to that extent. A further question is whether Mrs Blythe is entitled to damages over and above the amounts so expended.
3. The law values the private repose and security of every person in his or her own house "which it considers as his [sic] castle". Such a maxim is in part based on the family home as a spiritual and family locus. [9] In the absence of actual damage, general damages should reflect the significant purpose of vindicating a land owner's right to exclusive occupation. That may require a substantial award. [10] Thus, once a plaintiff obtains a verdict in an action of trespass, the plaintiff is entitled to an award of damages. The purpose of an action for trespass is not merely to compensate the plaintiff for damage to the land. It also serves the purpose of vindicating the plaintiff's right to the exclusive use and occupation of the plaintiff's land. The right of the occupier of land not to be unlawfully invaded must be supported by an effective sanction; otherwise the term will be just meaningless rhetoric. If the rights of individuals are not upheld by the granting of effective remedies, anarchy is invited. Nothing breeds social disorder as quickly as the sense of injustice that is apt to be generated by the unlawful invasion of a person's rights. [11] The Court must be satisfied that persons affected by intentional torts must be adequately compensated. That means that there is an onus on the plaintiff to show what the relevant losses and disadvantages are and what would be adequate compensation for the plaintiff. While evidentiary onuses may shift to the defendant, ultimately the onus as to quantum lies on the plaintiff. [12]
4. The trespass in question was a trespass involving Mrs Blythe's home. However, while the Blythe land is her home, it is a substantial parcel. There is a residence erected on the Blythe land. The waterfront track appears to be some considerable distance from the residence. This is not a case of intrusion that affected the privacy of the occupiers in their residence. Certainly, Mrs Blythe is entitled to vindication of her ownership of the Blythe land.
5. It is not a trespass of a trifling nature where defendants deliberately enter the plaintiff's land against the express wish of the plaintiff. Even if the entry itself causes no damage, damages may be given by way of compensation for injury to a plaintiff that is intangible, resulting from the circumstances and manner of the wrongdoing. The interest of a plaintiff against invasion of exclusive possession of land extends to the freedom from disturbance of the persons present on the land with the leave of the plaintiff, as family members or as an incident of some other bona fide domestic relationship. The affront to such persons may aggravate the infringement of the right of the plaintiff to enjoy exclusive and quiet possession. [13] I consider that an appropriate vindication is an award of damages of $2,000.

Stan Muzica's Claim under s 88K of the Conveying Act

1. Section 88K(1) relevantly provides that the Court may make an order imposing an easement over land if the easement is reasonably necessary for the effective use or development of other land that will have the benefit of the easement. Under s 88K(2), such an order may be made only if the Court is satisfied that: (a) use of the land having the benefit of the easement will not be inconsistent with the public interest; (b) the owner of the land to be burdened can be adequately compensated for any loss or other disadvantage that will arise from imposition of the easement; and (c) all reasonable attempts have been made by the applicant for the order to obtain the easement or an easement having the same effect but have been unsuccessful. Section 88K(4) requires that the order of the Court provide for payment by the applicant to specified persons of such compensation as the Court considers appropriate.
2. I am not persuaded that the easement sought by Stan Muzica, assuming he has standing to make the claim, is reasonably necessary for the effective use or development of the Willis land or that part of the Willis land in respect of which Stan Muzica claims to have an equitable interest. One difficulty, as I have indicated above, is identifying with any precision that part of the Willis land in respect of which Stan Muzica has an equitable interest. Clearly, the easement sought by Stan Muzica is not reasonably necessary for the effective use or development of a substantial part of the Willis land. There is adequate access to the Willis land for both vehicular and pedestrian traffic by means of a right of way giving access to Kiwong Street.
3. However, there was no adequate evidence as to the nature of the terrain of the Willis land to indicate why an easement over the Blythe land is reasonably necessary for the effective use or development of any part of the Willis land bordering on Yowie Bay. There was evidence that there is a flight of steps, albeit a steep one, that affords pedestrian access to the Willis Boatshed on the waterfront. There was evidence from Stan Muzica that, as an alternative to the easement, he would need to construct an inclinator. That is to say, it appears to be accepted by him that an inclinator would give access to the "lower" part of the Willis land.
4. Further, Stan Muzica accepted that there is vehicular access from Kiwong Street to a house erected on part of the Willis land which is "roughly half way down the block". He said that that access is "from the street over to the waterfront". There is vehicular access to that house. He agreed that that access goes past the house and said that a car "can get all the way down". He agreed that if one drove a car onto the Willis land one could go past the house and could continue all the way down to the waterfront. Stan Muzica said that it was wrong to say that it was not possible to drive a car all the way to the waterfront. That evidence seemed somewhat surprising. Nevertheless, it appears quite unequivocal. That is to say, it is possible to have vehicular access to the waterfront on the Willis land. In those circumstances, it is impossible to see why the easement sought by Stan Muzica is reasonably necessary for the effective use or development of any part of the Willis land. In those circumstances, the application for an order under s 88K must be rejected.
5. There was no evidence that any real attempt has been made by Stan Muzica or Mrs Willis to obtain an easement having the effect now sought by Stan Muzica. It is apparent that Mrs Willis does not seek an order. Under the proposed subdivision of the Blythe land, there is a proposal for rights of way over the land described as the waterfront track for the benefit of some of the lots in the subdivision. The rights of way will also burden other lots. However, the land that is the subject of those proposed rights of way would not give access to the Willis land at the waterfront. Thus, the easement sought by Stan Muzica would impact on the owner of the Blythe land to that extent. In possible recognition of that fact, an offer was made on behalf of Stan Muzica in the course of counsel's final address. The offer was to pay compensation to Mrs Blythe in the sum of $310,000. There was no evidence as to the basis for calculating that sum. There is no material on which it would be possible to assess adequate compensation.

Conclusion

1. It follows from what I have said above that Stan Muzica's claim for relief should be dismissed. On the other hand, Mrs Blythe is entitled to damages as follows:

• Compensation for slander of title equal to the amount of interest paid by Mrs Blythe on the sum of $1,100,000 borrowed by her less the amount of the forfeited deposit retained by her.
• Damages for trespass in the sum of $7,391.10, constituting $5,391.10 to compensate the cost of the fence, gate and concrete blocks, and $2000 for general damages. Mrs Blythe is entitled to her costs of proceedings and the cross-claim against Stan Muzica.

1. I propose to direct Mrs Blythe to bring in, within seven days, short minutes of orders to give effect to my conclusions.

Endnotes

1. See Palmer Bruyn & Parker Pty Ltd v Parsons (2001) 208 CLR 388; [2001] HCA 69 at [57].
2. See Palmer Bruyn & Parker Pty Ltd v Parsons at [57].
3. See Palmer Bruyn & Parker Pty Ltd v Parsons at [68].
4. See Palmer Bruyn & Parker Pty Ltd v Parsons at [81].
5. See Palmer Bruyn & Parker Pty Ltd v Parsons at [108] and [109].
6. See Palmer Bruyn & Parker Pty Ltd v Parsons at [108] and [114].
7. See Dasreef Developments Pty Ltd v Josiv Velkovski [2017] NSWSC 1698; Howe v Smith (1884) 27 ChD 89 at 110.
8. See Carpenter v McGrath (1996) 40 NSWLR 39 at [44], [61]
9. See TCN Channel 9 Pty Ltd v Anning (2002) 54 NSWLR 333; [2002] NSWCA 82 at [53] and [54].
10. See TCN Channel 9 Pty Ltd v Anning at [178].
11. See Plenty v Dillon (1991) 171 CLR 635; [1991] HCA 5 at 654-655.
12. See 117 York St Pty Ltd v Proprietors of Strata Plan No 16123 (1998) 43 NSWLR 504 at 516-517.
13. See New South Wales v Ibbett (2006) 229 CLR 638; [2006] HCA 57 at [31]. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 22 February 2018