Dial A Dump Industries Pty Ltd v Roads and Maritime Services - [2017] NSWCA 73 - NSWCA 2016 case summary — Zoe

NSWNSWCA

Dial A Dump Industries Pty Ltd v Roads and Maritime Services

[2017] NSWCA 73

Court of Appeal (NSW)|2016-09-14|Before: Beazley P, McColl JA, Leeming JA

View original source

At a glance

Source facts

Court

Court of Appeal (NSW)

Decision date

2016-09-14

Before

Beazley P, McColl JA, Leeming JA

Source

Original judgment source is linked above.

Judgment (34 paragraphs)

[1]

1984] HCA 36 Clissold v Perry (1904) 1 CLR 363 Coulton v Holcombe (1986) 162 CLR 1; [1986] HCA 33 Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89; [2007] HCA 22 Gartside v Inland Revenue Commissioners [1968] AC 553 Golden Mile Property Investments Pty Ltd (in liq) v Cudgegong Australia Pty Ltd (2015) 89 NSWLR 237; [2015] NSWCA 100 Griffith v Owen [1907] 1 Ch 195 Hornsby Council v Roads and Traffic Authority of New South Wales (1997) 41 NSWLR 151 Hoy v Coffs Harbour City Council (2016) 218 LGERA 411; [2016] NSWCA 257 ISPT Pty Ltd v Valuer General (2009) 165 LGERA 25; [2009] NSWCA 31 Keech v Sandford (1726) Sel Cas Ch 61; (1726) 25 ER 223 Kennon v Spry; Spry v Kennon (2008) 238 CLR 366; [2008] HCA 56 Lam Kee Ying Sdn Bnd v Lam Shes Tong [1975] AC 247 Mabo v Queensland (No 2) (1992) 175 CLR 1 Metropolitan Water Sewerage and Drainage Board v Histon [1982] 2 NSWLR 720 Minister for Education and Training v Tanner (2003) 128 LGERA 281; [2003] NSWCA 164 Osland v Secretary, Dept of Justice [No 2] (2010) 241 CLR 320; [2010] HCA 24 Perry v Clissold (1906) 4 CLR 374 Refina Pty Ltd v Binnie [2010] NSWCA 192 Shellharbour Municipal Council v Rovili Pty Ltd (1989) 16 NSWLR 104 Solution 6 Holdings Ltd v Industrial Relations Commission of NSW (2004) 60 NSWLR 558; [2004] NSWCA 200 Sorrento Medical Service Pty Ltd v Chief Executive, Department of Main Roads [2007] 2 Qd R 373; [2007] QCA 73 Spark v Meers [1971] 2 NSWLR 1 Spark v Whale Three Minute Car Wash (1970) 92 WN (NSW) 1087 Suttor v Gundowda Pty Ltd (1950) 81 CLR 418; [1950] HCA 35 Sze Tu v Lowe (2014) 89 NSWLR 318; [2014] NSWCA 462 TAL Life Ltd v Shuetrim (2016) 91 NSWLR 439; [2016] NSWCA 68 TNT Skypak International (Aust) Pty Ltd v FCT (1988) 82 ALR 175 Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority (2008) 233 CLR 259; [2008] HCA 5 Texts Cited: Brendan Edgeworth et al, Sackville & Neave: Australian Property Law (9th ed, 2013, LexisNexis) G E Dal Pont, Law of Agency, (3rd ed, 2014, LexisNexis) J D Heydon and M J Leeming, Jacobs' Law of Trusts in Australia (8th ed, 2016, LexisNexis) Category: Principal judgment Parties: Dial A Dump Industries Pty Ltd (Appellant) Roads and Maritime Services (Respondent) Representation: Counsel: B Coles QC; I Hemmings SC; M Seymour (Appellant) B Walker SC; N Eastman; M Astill (Respondent)

[4]

[This headnote is not to be read as part of the judgment] On 19 December 2014, land described as Lot 2 in DP168612, having a street address of 10-16 Albert Street, St Peters and known as the Alexandria Landfill (Lot 2) was compulsorily acquired for the purposes of the WestConnex Motorway pursuant to the Land Acquisition (Just Terms Compensation) Act 1991 (NSW) (the Act), ss 19 and 20. Alexandria Landfill Pty Ltd was the registered owner of Lot 2. Boiling Pty Limited was a lessee under an unregistered lease dated 7 February 2014. They each therefore had an interest in the land and were entitled to compensation upon its compulsory acquisition under s 37 of the Act. Dial A Dump Industries Pty Ltd (Dial A Dump) also claimed an entitlement to compensation on the basis that it had an interest in the land. It claimed that this interest arose from it having permission to use and occupy Lot 2 to operate a waste landfill and to carry out crushing, grinding and separating works. Its claim for compensation was rejected. Dial A Dump appealed to the Land and Environment Court, which ordered that the following separate question be heard and determined: "… whether Dial A Dump Industries Pty Ltd had 'an interest in land' as at the acquisition date for the purposes of s 5 of the Land Acquisition (Just Terms Compensation) Act 1991, as defined in s 4 of that Act, in, over or in connection with Lot 2 DP 1168612." On 8 April 2016, Preston CJ of LEC answered that question "no" and ordered that the proceedings be dismissed. Dial A Dump appealed that decision. Under the Land and Environment Court Act 1979 (NSW), s 57(1), the appeal is on a question of law. On appeal, Dial A Dump identified its interest in land as being: first, a legal interest arising from exclusive possession of Lot 2; secondly, an equitable interest as beneficiary of the lease held by Boiling on trust; and thirdly, an interest by way of a right, power or privilege over or in connection with Lot 2. The principal issue for determination on the appeal was whether, on the facts fully found, the court below ought to have held that Dial A Dump had an "interest in land" as defined in Land and Environment Court Act 1979 (NSW), s 4, being: (i) a legal or equitable interest in the land, and/or (ii) a right, power or privilege in, over or in connection with the land. In particular, the second question invited consideration of whether rights, powers or privileges over, or in connection with, land must be in the nature of proprietary or quasi-proprietary rights.

[5]

In relation to (i): (1) A legal interest in land can be an unregistered interest in land. A person who is in possession of land adverse to the true owner has a legal interest. [49]-[52] Clissold v Perry (1904) 1 CLR 363; Perry v Clissold (1906) 4 CLR 374; Spark v Whale Three Minute Car Wash (1970) 92 WN (NSW) 1087; Spark v Meers [1971] 2 NSWLR 1; Newington v Windeyer (1985) 3 NSWLR 555 Brendan Edgeworth et al, Sackville & Neave: Australian Property Law (9th ed, 2013, LexisNexis) (2) A relationship of agency necessarily involves acting in a representative capacity for the principal. The words or phrases "for", "on behalf of", "for the benefit of" or "authorise" may be used to describe a relationship but without the characteristic of representation, there is no agency. [57]-[58] G E Dal Pont, Law of Agency (3rd ed, 2014, Lexis Nexis) (3) If a choice is to be made between a party acting legally rather than acting illegally, then in the absence of any evidence of the latter, it is appropriate to proceed on the basis that the party is or was conducting itself lawfully. [71] (4) The object of a power of appointment under a discretionary trust is not a beneficiary in the traditional sense of the word. It does not have a beneficial interest in the trust. It does, however, have standing to bring an action against the trustee requiring it to duly administer the trust. This right is a chose in action and is not a right in rem and accordingly does not constitute an equitable interest in land. [93]-[94] Gartside v Inland Revenue Commissioners [1968] AC 553; Kennon v Spry; Spry v Kennon (2008) 238 CLR 366; [2008] HCA 56; Brady Street Developments Pty Ltd v M E Asset Investments Pty Ltd [2013] NSWSC 1755 J D Heydon and M J Leeming, Jacobs' Law of Trusts in Australia (8th ed, 2016, LexisNexis) (5) The fact that a company carries on significant commercial operations on land is not in itself evidence of the fact that it has been given possession of in a manner giving rise to an equitable interest. In this case, the business relationship between the parties served to confirm that no equitable interest arose. [96]-[97] (6) The holding of a licence in respect of a business carried on on land which requires the exercise of control over that land is not consistent with a third party having an interest in possession. [96] (7) When an appellant seeks to raise a new point of law on appeal, it is not sufficient for the appellant to assert that it could not have been met by the evidence at trial. The appellant must also demonstrate that the respondent would not have conducted the case differently at trial. [105] TAL Life Ltd v Shuetrim (2016) 91 NSWLR 439; [2016] NSWCA 68; Sze Tu v Lowe (2014) 89 NSWLR 318; [2014] NSWCA 462

[10]

Judgment

BEAZLEY P: On 19 December 2014, land at St Peters, described as Lot 2 in DP168612, having a street address of 10-16 Albert Street, St Peters and known as the Alexandria Landfill (Lot 2) was compulsorily acquired for the purposes of the WestConnex Motorway by notice published in the New South Wales Government Gazette No 126 pursuant to the Land Acquisition (Just Terms Compensation) Act 1991 (NSW) (the Act), ss 19 and 20. Upon its compulsory acquisition, the land vested in the WestConnex Delivery Authority.
Immediately prior to its compulsory acquisition, Alexandria Landfill Pty Ltd (ALF) was the registered owner of the estate in fee simple of Lot 2. Boiling Pty Limited (Boiling) was the lessee of Lot 2 pursuant to an unregistered lease dated 7 February 2014. Each was therefore an owner of an interest in the land and thereby entitled to be paid compensation consequent upon the compulsory acquisition: see s 37 of the Act.
The appellant, Dial A Dump Industries Pty Ltd (Dial A Dump), also claimed an entitlement to compensation on the basis that it had an interest in the land, being permission to use and occupy Lot 2 to operate a waste landfill and to carry out crushing, grinding and separating works on the land. Its claim for compensation was rejected by the WestConnex Delivery Authority.
Dial A Dump appealed to the Land and Environment Court pursuant to s 67(1) of the Act against rejection of the claim: Dial A Dump Industries Pty Ltd v Roads and Maritime Services [2016] NSWLEC 39. On 29 October 2015, the Court ordered that the following separate question be heard and determined: "… whether Dial A Dump Industries Pty Ltd had 'an interest in land' as at the acquisition date for the purposes of s 5 of the Land Acquisition (Just Terms Compensation) Act 1991, as defined in s 4 of that Act, in, over or in connection with Lot 2 DP 1168612."
On 8 April 2016, Preston CJ of LEC answered that question "no" and ordered that the proceedings be dismissed.
Dial A Dump appealed against his Honour's decision. Pursuant to the Land and Environment Court Act 1979 (NSW), s 57(1), the appeal is on a question of law. As was explained in ISPT Pty Ltd v Valuer General (2009) 165 LGERA 25; [2009] NSWCA 31, Allsop P (as his Honour then was) summarised the nature of an appeal on a question of law as follows, at [3]: "The nature of this process was discussed at length in Maurici v Chief Commissioner of State Revenue [2001] NSWCA 78; 51 NSWLR 673 and B & L Linings Pty Ltd v Chief Commissioner of State Revenue [2008] NSWCA 187 at [57]-[79]. It is the 'decision' not the 'appeal' which must be on a question of law: B & L Linings at [70], citing Roads and Traffic Authority of New South Wales v Peak [2007] NSWCA 66 at [139]. Such an appeal is 'on' a question of law, not limited, however, 'to an error of law': Mir Bros Unit Constructions Pty Ltd v Roads and Traffic Authority of New South Wales [2006] NSWCA 314 at [27]; and see Peak at [139]."
In Metropolitan Water Sewerage and Drainage Board v Histon [1982] 2 NSWLR 720, Samuels JA, considering the text of s 54 of the Government and Related Employees Appeal Tribunal Act 1980 (Cth), explained, at 725, that: "… As a matter of grammar the words 'on a question of law' qualify 'any decision of the Tribunal', and not the words 'appeal to the Supreme Court'. It follows that the ordinary meaning of this language is that an appeal lies against any decision of the tribunal which is a decision on a question of law." See also Hoy v Coffs Harbour City Council (2016) 218 LGERA 411; [2016] NSWCA 257 at [18].

[12]

Legislation

The Act provides, relevantly: "4 Definitions (1) In this Act: … interest in land means: (a) a legal or equitable estate or interest in the land, or (b) an easement, right, charge, power or privilege over, or in connection with, the land. land includes any interest in land. … 19 Compulsory acquisition by notice in Gazette (1) An authority of the State that is authorised to acquire land by compulsory process may, with the approval of the Governor, declare, by notice published in the Gazette, that any land described in the notice is acquired by compulsory process. … 20 Effect of acquisition notice (1) On the date of publication in the Gazette of an acquisition notice, the land described in the notice is, by force of this Act: (a) vested in the authority of the State acquiring the land, and (b) freed and discharged from all estates, interests, trusts, restrictions, dedications, reservations, easements, rights, charges, rates and contracts in, over or in connection with the land. … 37 Right to compensation if land compulsorily acquired An owner of an interest in land which is divested, extinguished or diminished by an acquisition notice is entitled to be paid compensation in accordance with this Part by the authority of the State which acquired the land. … 39 Claim for compensation (1) A person who wishes to claim compensation under this Part must lodge a claim in accordance with this section with the authority of the State that is acquiring the land concerned. (2) A claim for compensation must be in the form prescribed by the regulations or (if no such form is prescribed) in the form approved by the Minister. (3) The claim form may require information to be verified by statutory declaration. (4) A claim for compensation may be withdrawn by the claimant."
As the activities carried on on Lot 2 required the person carrying on those activities to be the holder of a licence under the Protection of the Environment Operations Act 1997 (NSW) (POEO Act), the following provisions of that Act are also relevant: "42 Environment protection licences Environment protection licences may be issued and otherwise dealt with in accordance with this Chapter. 43 Types of licences Environment protection licences may be issued for the following purposes: … (b) to authorise the carrying out of scheduled activities at any premises, as required under section 48 … … 48 Licensing requirement - scheduled activities (premises-based) (1) Application of section This section applies to scheduled activities where Schedule 1 indicates that a licence is required for premises at which the activity is carried on. (2) Offence A person who is the occupier of any premises at which any such scheduled activity is carried on is guilty of an offence, unless the person is, at the time that activity is carried on, the holder of a licence that authorises that activity to be carried on at those premises. Maximum penalty: (a) in the case of a corporation - $1,000,000 and, in the case of a continuing offence, a further penalty of $120,000 for each day the offence continues, or (b) in the case of an individual - $250,000 and, in the case of a continuing offence, a further penalty of $60,000 for each day the offence continues. … 64 Failure to comply with condition (1) Offence If any condition of a licence is contravened by any person, each holder of the licence is guilty of an offence. Maximum penalty: (a) in the case of a corporation - $1,000,000 and, in the case of a continuing offence, a further penalty of $120,000 for each day the offence continues, or (b) in the case of an individual - $250,000 and, in the case of a continuing offence, a further penalty of $60,000 for each day the offence continues. Note. An offence against subsection (1) committed by a corporation is an offence attracting special executive liability for a director or other person involved in the management of the corporation - see section 169. (2) Defence The holder of a licence is not guilty of an offence against this section if the holder establishes that: (a) the contravention of the condition was caused by another person, and (b) that other person was not associated with the holder at the time the condition was contravened, and (c) the holder took all reasonable steps to prevent the contravention of the condition. A person is associated with the holder for the purposes of paragraph (b) (but without limiting any other circumstances of association) if the person is an employee, agent, licensee, contractor or sub-contractor of the holder. (3) Application This section extends to conditions to which the suspension, revocation or surrender of a licence is subject under section 81. For that purpose, a reference to the holder of the licence includes a reference to the former holder of the licence. … 258 Evidence relating to occupier of premises (1) In any proceedings under this Act, no proof is required (until evidence is given to the contrary) of the fact that a person is, or at any relevant time was, the occupier of any premises to which the proceedings relate. (2) In any proceedings under this Act, the holder of a licence under this Act in respect of any premises at a particular time or period is taken to be the occupier of the premises at that time or during that period." "Waste storage" is included in Sch 1: see cl 42.

[13]

Primary judge's factual findings

The primary judge, at [12]-[49], set out the relevant facts for the purposes of determining the separate question. Dial a Dump relied in particular upon the following facts as found by his Honour (the following paragraphs being taken directly from his Honour's judgment): "12 … ALF at the date of acquisition was the registered proprietor of Lot 2. ALF had purchased Lot 2 from the City of Sydney Council in January 2002. Around the same time, Environment Protection Licence 4627 ('EPL 4627') was transferred from the Council to ALF. EPL 4627 authorised ALF to carry out the scheduled activities listed as 'waste facilities - landfilling' and 'waste facilities - solid waste land' on Lot 2 … … 14 On 9 December 2003, a Deed of Settlement was made between the settlor and Boiling. The Deed of Settlement recited … that Boiling had consented to become the Trustee thereof … and that Boiling as trustee would stand possessed of the Trust Fund upon the trusts expressed in the Deed of Settlement (cl 12). … 19 … The Trustees had powers of advancement including to 'allow any Beneficiary to occupy have custody of or use any moveable or immovable property for the time being or forming part of the Trust Fund on such terms or conditions … as the Trustees shall think fit' (cl 6(6)) … 20 The Trustees had a wide power of sale … 21 The Trustees had a wide power of investment of the assets of the Trust Fund (cl 9). The Trustees also had other powers relating to assets included in the Trust Fund … The Trustees had additional powers as to land forming part of the Trust Fund, including powers to lease or sell the land … … 24 On 10 November 2006, ALF registered the business name of 'Dial A Dump Industries'. ALF remained the current holder of that business name at the date of acquisition of Lot 2. 25 On 13 June 2007, Boiling resolved to change the name of the trust from DAD Employment Services Trust to 'Dial A Dump Industries Trust'. 26 Also on 13 June 2007, ALF resolved to grant a lease of Lot 2 to ''Dial A Dump Industries Trust' formerly known as [DAD Employment Services Trust] for the purposes of carrying on waste collection disposal and recycling activities on a commercial basis'. 27 The lease of Lot 2 was in fact granted by ALF to Boiling, commencing on 1 July 2007 for a term of 6 months but with an option to renew for a period of 5 years … 28 The lease was never registered. 29 On 21 June 2007, the single environment protection licence that ALF had held until then, authorising the carrying on of the scheduled activities on Lot 2, was split between ALF and Boiling. ALF continued to be the holder of EPL 4627, authorising the carrying on of the scheduled activities listed as 'waste facilities-landfilling' and 'waste facilities-solid waste land' … 30 A separate environment protection licence, EPL 12594, was issued to Boiling authorising the carrying on of the scheduled activities of 'crushing, grinding or separating works' and 'waste facilities - store/transfer/sep[arate]' … EPL 12594 operated subject to the development consent granted by the Court on 28 September 2006, which was limited to a period of 5 years from the date of the consent (condition A5.1 of EPL 12594)."
It was not in dispute that ALF and Boiling each held a licence in respect of Lot 2. As the primary judge observed, at [31]: "In the period 1 July 2007 to 30 June 2008, ALF, as the owner of Lot 2 and the holder of EPL 4627, carried on the scheduled activity of landfilling on Lot 2 and Boiling, as the lessee of Lot 2 and holder of EPL 12594, carried on the scheduled activities of waste collection and recycling on Lot 2."
Between 1 July 2007 and 30 June 2008, a number of what might be described loosely as 'internal corporate arrangements' were put in place. Boiling was licenced to use the trademark name "Dial A Dump", then owned by Mr Malouf, ALF's director and principal shareholder, in connection with carrying on "the business of rubbish removal, plant hire and skip bin services". On 22 May 2008, ALF resolved to incorporate the company which became Dial A Dump. At the same time, and inconsistently with the arrangement with Boiling, ALF resolved that, when incorporated, Dial A Dump should enter into an agreement with Mr Malouf to use the trademark "Dial A Dump". Nothing was made of this inconsistency on the issues raised for determination on the appeal from the primary judge's answer to the separate question. On 12 June 2008, Dial A Dump became a wholly owned subsidiary of ALF.
On 30 June 2008, ALF held a meeting, attended by Ian Malouf, Director, and Christopher Briggs, Solicitor. The minutes of that meeting recorded the following: "3. Dial A Dump Industries Trust the holder of the environment protection licence 12594 will cease commercial operations of recycling, waste transfer and collections carried on under the name of Dial A Dump Industries Trust with immediate effect. 4. [Dial A Dump] will commence commercial operations of landfilling, recycling, waste transfer and collections which it will carry on under [that name]. This will be done for and on behalf of the Alexandria Landfill Consolidated tax group with effect from 1st July 2008. Monies collected by Dial A Dump Industries Trust relating to activities before it commenced business will be accounted for to Dial A Dump Industries Trust. 5. NSW EPA has advised that it requires different corporate entities to hold the environment protection licences when there are two separate activities on the one site and that the holder of an environment protection licence must also demonstrate that it exercises control over premises. Licence 12594 will remain with Boiling as trustee for Dial A Dump Industries Trust and the Trust will hold the licence and the lease of the premises on trust for [Dial A Dump]. 6. [Dial A Dump] will operate the waste facility at 9-16 Albert Street, St Peters on behalf of the Alexandria landfill group and the group will adopt new consolidated accounting practices to be set up within the new AX computer system. Each different activity will be identified as an accounting division within [Dial A Dump] and it will account for all waste revenues and expenses on behalf of the Group. 7. All invoicing for the group is to be shown as by [Dial A Dump] and the documentation must be amended to reflect the separate ABN. Resolution of the Sole member of the Company passed on 30th June 2008 in accordance with section 249N of the Corporations Act The Director resolved as follows, Mr Biggs be directed to take all operational and legal steps to give effect to the foregoing and to report on progress from time to time."
At trial and in the primary judgment, the contents of the minutes were referred to as "a resolution" of ALF. However, as the document is a record of matters other than the passing of resolutions, I will refer to the document as either the minutes of 30 June 2008, or the resolution of 30 June 2008, as appears most appropriate. As will become apparent, the terms of the resolution are central to the determination of the appeal.
The directors of Boiling also met on 30 June 2008 and passed resolutions (the Boiling resolution) in respect of the cessation of business conducted by Boiling and the nomination of Dial A Dump as a beneficiary of the Trust. Boiling also resolved that: "… all leases, licences, loans[,] choses in action, interests in land formerly held by the Trust in connection with its commercial operation of collecting[,] receiving transporting[,] recycling[,] selling or landfilling of waste … shall forthwith be held upon Trust for Dial A Dump …"
Arrangements were made for the sale of trucks and bins from the waste collection business carried on by ALF to Dial A Dump. Customers of the businesses of ALF and Boiling were advised by letter from Dial A Dump dated 1 August 2008 that the two operations had been merged and their ongoing account relationship had been assigned and transferred to Dial A Dump. Dial A Dump thereafter invoiced customers under its name.
The primary judge made no finding as to whether the 30 June 2007 lease was renewed or held over as lessee. But in any event, on 1 January 2014, ALF granted a new lease of Lot 2 to Boiling for a one year term with an option to renew. This lease was also not registered. Clause 3 of Annexure A to the lease acknowledged that the lessor, ALF, was the licence holder of EPL 4627, which authorised landfilling on the property, and the lessee, Boiling, was the licence holder of EPL 12594, which authorised resource recovery on the property.
It is important to note in passing that Dial A Dump did not at any time become the holder of an environmental protection licence in respect of either of the activities carried on on Lot 2. The licences to carry on those activities continued at all times to be held by ALF and Boiling respectively. According to the Boiling resolution, Boiling's licence had become Trust property: see [17]. Whether the licence issued under the POEO Act was capable of being held on trust was not put in issue.
Based on these factual findings, the primary judge rejected the argument that Dial A Dump had a legal, equitable or other right, power or privilege over or in connection with the land.

[14]

Primary judge's reasons: no legal interest

The primary judge held, at [94], that Dial A Dump had not established, as at the date of acquisition, that it had a legal interest in the land flowing from any permission to occupy Lot 2 to carry out commercial operations. His Honour's reasons for so finding may be summarised as follows.
According to his Honour, at [95], Dial A Dump had not established who had granted it permission to occupy Lot 2, how any such permission was granted or what were the terms of any such permission. His Honour held, at [95], that the evidence did not establish that Boiling or ALF granted Dial A Dump the right to exclusive possession of Lot 2, so as to give it a legal interest. His Honour held that any permission Dial A Dump had to occupy Lot 2 was purely personal.
In reaching those conclusions, his Honour first looked at the position of Boiling. His Honour noted, at [96], that Boiling was the lessee of Lot 2, first under the lease commencing 1 July 2007 and then under the lease commencing 1 January 2014, and that under the terms of each lease, Boiling was granted the right to exclusive possession of Lot 2 and thereby had an interest in the land.
His Honour referred to the terms of the resolution passed by Boiling on 30 June 2008 that: "… all leases … formerly held by the Trust in connection with its commercial operation of collection, receiving, transporting, recycling, selling or landfilling of waste … shall forthwith be held on trust [for Dial A Dump] …" and observed, at [99], that the resolution did not in itself assign, sublet or otherwise part with possession of all or part of the leased premises of Lot 2. His Honour also noted that there was no evidence of any other agreement between Boiling and Dial A Dump with respect to an assignment, subletting or other parting with possession by Boiling of Lot 2.
His Honour noted that each of the leases to Boiling contained a covenant against assigning, subletting, sharing or parting with possession of the whole or any part of the leased premises: see cl 27.1 of the 2007 lease; cl 10.7 of the 2014 lease. His Honour observed, at [100], that Boiling had not complied with cl 27.1 of the lease, ALF having parted with possession. This was so regardless whether Dial A Dump was or was not a related business. If it was a related business, notice that Boiling had parted with possession was required to be given to ALF as the lessor and there was no evidence that such notice had been given. If it was not a related business, the consent of ALF as lessor was required and, again, there was no evidence that consent had been given.
His Honour noted, at [101], in relation to the lease of Lot 2 commencing 1 January 2014, that no resolution had been passed equivalent to that passed by Boiling on 30 June 2008. In other words, no resolution had been passed that the January 2014 lease was held on trust for Dial A Dump, nor was there any evidence of an assignment or sublease of Lot 2 to Dial A Dump, nor any evidence of an agreement relating to possession. His Honour concluded, at [102], that: "Boiling never sublet or otherwise parted with possession of Lot 2 and therefore never sought ALF's consent to subletting or otherwise parting with possession of Lot 2."
His Honour, at [103]ff, next dealt with the legal position created by or recorded in Boiling's resolution of 30 June 2008, noting, at [104], that none of the notes in the minutes "evidence any grant of or intention to grant a legal interest in Lot 2 to [the appellant]".
His Honour stated, at [107], that while it might be thought that ALF, by note 4 in the resolution of 30 June 2008, impliedly permitted Dial A Dump to carry out the landfilling previously conducted by ALF pursuant to EPL 4627, such implied permission would not necessarily carry with it any proprietary interest. As his Honour observed at [108], "[t]o permit a person to use and occupy land does not necessarily involve parting with possession", citing Lam Kee Ying Sdn Bnd v Lam Shes Tong [1975] AC 247 at 256; Australian Mutual Provident Society v 400 St Kilda Road Pty Ltd [1990] VR 646 at 663; and Akici v LR Butlin Ltd [2006] 2 All ER 872 at 880 [37]-[42].
His Honour considered, at [108]ff, that the evidence indicated that ALF had not parted with possession of Lot 2. In his Honour's view, six factors pointed to this.
First, as at 30 June 2008, ALF could not give exclusive possession to Dial A Dump, as under the 2007 lease to Boiling, Boiling had exclusive possession of Lot 2: see at [109].
Secondly, the minutes of 30 June 2008 recorded that Dial A Dump would carry on the activities on the land "for and on behalf of the Alexandria Landfill Consolidated Tax Group". Such permission did not give any permission to Dial A Dump to carry on the activities on the land for itself. His Honour pointed out that "Dial A Dump would not be carrying on commercial operations or waste facility on Lot 2 as principal but rather as agent": see at [110]. His Honour, at [110], added that: "… the arrangement was even more confused by ALF recording that 'each different activity will be identified as an accounting division within Dial A Dump Pty Ltd', a different corporate identity to [Dial A Dump], and 'it will account for all waste revenues and expenses on behalf of the Group'."
Thirdly, ALF remained the holder of the licence EPL 4627 and, as recorded in the minutes of 30 June 2008, ALF, as holder of the licence, was required by the EPA to demonstrate that it exercised control over the licenced premises. His Honour concluded, at [111], that the right in ALF to control the possession of the premises was inconsistent with it having parted with possession of the premises: see at [111].
Fourthly, his Honour observed that ALF had not granted a lease to, or otherwise given Dial A Dump exclusive possession of Lot 2, either by written or oral agreement: see at [112]. His Honour concluded that, on the basis of the indicators to which he had referred and in the absence of evidence of any written or oral agreement: "The resolution to permit [Dial A Dump] to carry on commercial operations on Lot 2 was not effected by any grant to [Dial A Dump] of a proprietary interest in Lot 2." It should be noted that this conclusion was not the subject of challenge.
Fifthly, his Honour observed, at [113], that even if ALF had parted with possession on 30 June 2008, that did not survive the grant of the new lease to Boiling commencing 1 January 2014, whereby ALF granted exclusive possession of Lot 2 to Boiling.
Finally, his Honour added, at [114], "for completeness", that Dial A Dump itself had not recorded that it had been granted a proprietary interest, the letter of 1 August 2008 in relation to the new billing arrangements not necessarily stating that was the position nor evidencing any grant of a proprietary interest in Lot 2. See above at [18].
His Honour at [120], considered that the financial arrangements between ALF, Boiling and Dial A Dump were equivocal as to whether Dial A Dump had a proprietary interest in Lot 2. For example, his Honour was of the view, at [118], that Dial A Dump paid levies imposed under the licence on behalf of ALF and Boiling and did certain work required to be done under the licence, such as "volumetric surveying and monitoring and environmental management" which indicated that Dial A Dump was carrying on the scheduled activities on Lot 2 for and on behalf of ALF and Boiling. Likewise, his Honour considered that the fact that ALF continued to be the client of utilities that provided services to Lot 2 and the fact that Boiling, through the Trust, provided the labour used to carry on the commercial operations on Lot 2 were equivocal.

[15]

Dial A Dump's submissions

Dial A Dump accepted that it had the onus of demonstrating a right to possession. It submitted that the primary judge erred in examining whether it could show an expressly documented right to exclusive possession conferred by ALF or Boiling. It submitted that a legal interest could be created other than by way of an express grant and that its legal interest arose by way of exclusive possession of the land.
Recognising that as the appeal was on a question of law and his Honour's primary findings of fact were not susceptible to challenge, Dial A Dump did not challenge any of the primary judge's central findings. Rather, it contended that it had established that it had a legal interest in land on the primary judge's findings of fact and that its occupation and use constituted the essential elements of factual possession sufficient to give it a legal interest in land. Dial A Dump also contended that the receipt of revenue or rents and profits was itself a mode of possession and also put in issue whether his Honour had made a finding that there was an agency relationship between it and ALF and Boiling respectively.
In support of its argument on possession, Dial A Dump submitted that it had been "dealing with the land as an occupying owner might be expected to deal with it and no one else has done so" and, accordingly, it had good title at law against the whole world except someone who could show better title. According to Dial A Dump, someone could be in possession by permission or consent or authority and provided the quality of the possession was sufficiently exclusive, this could be capable of generating a good title by possession. It did not matter, on Dial A Dump's submission, that an interest so created was subject to immediate defeasance. It contended that even a trespasser may be in possession: see Clissold v Perry (1904) 1 CLR 363 (as affirmed by the House of Lords in Perry v Clissold (1906) 4 CLR 374).
Dial A Dump also submitted that even if it were in breach of the POEO Act by conducting operations on Lot 2 without a licence, that did not affect the fact that, by carrying on commercial enterprises on the land, it was in possession of the land.
Dial A Dump submitted that the principles stated in Perry v Clissold applied both at general law and under the Real Property Act 1900 (NSW) and that the procedural provisions of the legislation in Perry v Clissold resembled those in the instant case.

[16]

RMS' submissions

On RMS' construction of para (a) of the definition, "interest in land" required a party to have a registered legal interest. RMS submitted, however, that whether that was correct did not need to be decided, as Dial A Dump did not have exclusive possession of the land such as to give it a legal interest in the land. RMS accepted that the appellant had permission to operate a business on Lot 2, but submitted that this was no more than a permission to use and occupy the land and did not involve the grant or right of exclusive possession. Rather, according to RMS, the findings of the primary judge supported a finding of concurrent occupation consonant with an agency arrangement. Indeed, RMS contended that his Honour had made a finding of agency, and in the absence of any other evidence, the fact of agency prevented Dial A Dump from establishing that it had an exclusive right to possession of Lot 2.
RMS submitted that Perry v Clissold was distinguishable from the facts in this case. It contended that, contrary to Dial A Dump's argument, Dial A Dump did not have exclusive possession of the acquired property because Lot 2 was leased to Boiling as at the date of acquisition. In this regard, it pointed out that it could not be overlooked that Boiling had lodged a claim for compensation in its own right. RMS also submitted that, unlike the position in Perry v Clissold, Lot 2 was not a vacant parcel of land "without an apparent owner". In addition, RMS pointed out that parts of Lot 2 had been licenced to third parties at the date of acquisition.
RMS submitted that Dial A Dump's submission that it had a legal interest in Lot 2 involved a "slide" from the fact that it had occupation and use of Lot 2 to a claim that it had exclusive possession. RMS also pointed out that the primary judge made a finding of fact that Dial A Dump was not in possession of Lot 2, and as a consequence Dial A Dump's contention should not be entertained, given that the appeal was on a question of law and also given that his Honour's finding had not been challenged.
RMS also contended that it ought not be inferred that Dial A Dump and the other group members would order their affairs in a way that involved the commission of an offence by Dial A Dump operating the businesses conducted on Lot 2 when it was not licenced to do so. RMS pointed out that Dial A Dump did not contend before the primary judge, for obvious reasons, that it did not matter, for the purposes of establishing exclusive possession, that an offence was being committed in its doing so.
RMS also pointed out that the 2014 lease did not fall within the terms of Boiling's 30 June 2008 resolution but submitted that even if it did, a leasehold interest held on trust for a beneficiary does not give that beneficiary a right to possession of the property so as to create in the beneficiary a legal interest.

[17]

Consideration

Although the arguments of Dial A Dump were somewhat wide ranging, it seems to me that the following issues are raised by the submissions of both parties: (i) whether a legal interest in land must be a registered legal interest; (ii) whether his Honour erred in deciding the question whether Dial A Dump had a legal interest by reference to a documented interest only; (iii) whether, on the basis of the principles in Perry v Clissold, Dial A Dump had established that it had a legal interest in land; (iv) whether its use, occupation of and receipt of revenue from the activities carried on the land were sufficient indicia of exclusive possession; (v) whether it was open to Dial A Dump to argue on the appeal that it had a legal interest in Lot 2 in land when it had not established that any such legal interest derived from its relationship with ALF and did not challenge his Honour's finding at [102] that Boiling had not parted with possession of Lot 2; (vi) whether the nature of the relationship between Dial A Dump and ALF and Boiling respectively was one of agency and whether his Honour made a finding of agency; and (vii) whether, if Dial A Dump was acting on its own behalf in terms of its occupation of the land and carrying on business on the land would thereby be acting contrary to the terms of the POEO Act, was indicative that it did not have a legal interest in land.
As to the first issue, in Perry v Clissold, Griffith CJ stated, at 377, that possession was "good against all the world except the real owner" and was "a saleable and devisable interest". Perry v Clissold involved Old System land and to that extent is not directly on point. However, it is established law in New South Wales that a party can have a legal interest in Torrens title land other than a documented title, the right to exclusive possession being sufficient as against all but the lawful owner: see Spark v Whale Three Minute Car Wash (1970) 92 WN (NSW) 1087 at 1104-1105. See also Brendan Edgeworth et al, Sackville & Neave: Australian Property Law (9th ed, 2013, LexisNexis) at 135 [2.64], which states that: "The principles discussed in Asher v Whitlock, Perry v Clissold and Allen v Roughley continue to apply to Torrens system land."
Spark v Whale Three Minute Car Wash was distinguished by this Court in Refina Pty Ltd v Binnie [2010] NSWCA 192. However, that case concerned a claim for a possessory interest in land as against the registered proprietor whereas, as pointed out by Allsop P, Spark v Whale Three Minute Car Wash was a case concerned with parties other than the registered party.
In Spark v Meers [1971] 2 NSWLR 1 Hope J observed, at 13, that the right of a party in possession is a right to bring an action in ejectment against a dispossessing party, being someone other than the registered proprietor. Hope J's observation was approved in Refina Pty Ltd v Binnie at [10]. See also Newington v Windeyer (1985) 3 NSWLR 555 at 563 where McHugh JA (as his Honour then was) stated that "[a] person who is in possession of land adverse to the true owner has a legal interest in the land".
But in any event, it is well recognised that an unregistered short term lease is a legal interest in land.
As to the second issue, contrary to Dial A Dump's submission, the primary judge did not confine his consideration of Dial A Dump's claim to a legal interest in land by reference only to a documented interest. His Honour's finding, at [95], [121]-[122], that Dial A Dump did not have a legal interest in Lot 2, was not based solely on the absence of an expressly documented right of exclusive possession. His Honour found, at [112]-[113], that there was no evidence of any written or oral agreement giving Dial A Dump a legal interest in land. Apart from the evidence, principally sourced in the terms of the resolution of 30 June 2008, that Dial A Dump had taken over the respective operations of ALF and Boiling that were conducted on and from Lot 2, Dial A Dump did not point to any evidence of an agreement or arrangement, documented or otherwise, whereby it was given exclusive possession of the land.
That leads to the questions raised by third to sixth issues identified above, which are conveniently dealt with together.
RMS contended in its submission, and Dial A Dump resisted the argument, that his Honour had made a finding of agency. None of his Honour's reasoning at [103]ff, which related to the question whether Dial A Dump acquired a legal interest in Lot 2 from ALF, was subject to any significant challenge and, in my opinion, cannot be assailed. However, his Honour's reference to an agency relationship requires further consideration, that being a significant focus of Dial A Dump's oral submissions
When regard is had to the manner in which the primary judge constructed his reasons, Dial A Dump may be correct in asserting that his Honour did not make a finding of agency. His Honour's approach was to consider the various factual circumstances relevant to the question whether Dial A Dump had established that it had an interest in land and, relevantly for the present argument, a legal interest in land. His Honour considered that the factual circumstances either indicated or pointed against there being a legal interest in land, or at best were equivocal.
Accepting, or at least assuming for Dial A Dump's benefit that his Honour did not make a positive finding of agency, I am nonetheless of the opinion that no other conclusion is tenable on the facts found by his Honour. As G E Dal Pont explains in Law of Agency, (3rd ed, 2014, LexisNexis) at 6 [1.4], the relationship of agency necessarily involves: "… acting in a representative capacity for the principal, whether for the purpose of creating contractual relations for a principal or to represent the principal in a more restricted ambit." (emphasis in original)
Dal Pont continues, in a passage which well illustrates the point in this case: "Put another way, if the right by virtue of which the alleged agent acts is an independent right he or she already possessed, then he or she is not an agent; if it is, conversely, by virtue of some authority from another, then he or she is an agent. Thus, even though the words or phrases 'for', 'on behalf of', 'for the benefit of' or even 'authorise' may be used in relation to services done to advantage the person who requests them, lacking a representation of that person to third parties, there is no agency."
The terms of the resolution of 30 June 2008 were that Dial A Dump was "to act on behalf of ALF and Boiling" in the respects referred to in the document. Dial A Dump had no independent right to carry on the businesses itself. Dial A Dump's letter of 1 August 2008 to customers was only consistent with Dial A Dump carrying on the businesses on behalf of the two companies and was a representation of the capacity in which it was acting.
Once that is accepted, it is apparent that Dial A Dump's reliance upon the fact that it occupied the premises and received revenue for doing so and paid certain expenses does not establish that it had any legal interest in the land. Occupation of land is a different concept from possession. As Toohey J said in Mabo v Queensland (No 2) (1992) 175 CLR 1 at 212, "[p]ossession is a conclusion of English law … Occupation on the other hand is a question of fact". His Honour went on to explain, at 212-213, that: "… In some cases the person in occupation is not the possessor of land, for example where he or she is an agent of the possessor. But it may be presumed, in the absence of circumstances which show possession is in another, that the occupier of land is also in possession … At common law conduct required to prove occupation or possession will vary according to the circumstances including, for example, whether the claimant enters as a trespasser or as of right". (emphasis added)
Given the circumstances, and in particular ALF's legal title and Boiling's leasehold interest and their continued holding of the POEO licences, Dial A Dump's occupation did not constitute legal possession such as to constitute an interest in land.
That answers Dial A Dump's contention that it had a legal interest derived from either ALF or Boiling. It is necessary, however, as a matter of completeness to deal with Dial A Dump's reliance upon Perry v Clissold.
Perry v Clissold concerned the Lands for Public Purposes Acquisition Act 1880 (Vic). Pursuant to s 10 of that Act, the owners of land or the persons who, but for the operation of the Act, would have been such owners, were entitled to receive compensation for the land if it was acquired by the State. At the time that the notice of acquisition was published, the land was in the possession of a Mr Frederick Clissold. Notice of the resumption was given to Mr Clissold, who died shortly thereafter. The executors of his estate claimed compensation.
Mr Clissold had entered into possession of the land in 1881. The land at that time had been vacant and Mr Clissold had fenced it and, since that time, had let it to different tenants, received rent and paid rates and taxes. The Minister argued, however, that Mr Clissold had been a mere trespasser without any estate or interest in the land.
The High Court at 376, referred to the principle of statutory construction that a statute was not to be construed, if possible, so as to interfere with vested rights and noted that Mr Clissold "was entitled to possession of the land as against anyone except the real owner, and could have asserted that right by an action of ejectment", including as against the resuming authority were it not for the notice of acquisition. The Court continued: "But, if the contention of the respondents [that Mr Clissold had no interest in the land] were to prevail, that the effect of the notification was to swallow up the ten years' title of the claimant, that would be to give to it the effect of a judgment in ejectment recovered by the real owner - who is unknown to this day - against the person in possession, and the claim to compensation into which the estate is to be converted would be illusory. That would certainly not be a protection of vested interests. To construe the Act in that way would be to make it an Act, not for compensation, but for confiscation."
On appeal to the Privy Council in Perry v Clissold (1906) 4 CLR 375, the Minister's argument was also rejected. Lord Macnaghten said at 377: "It cannot be disputed that a person in possession of land in the assumed character of owner and exercising peaceably the ordinary rights of ownership has a perfectly good title against all the world but the rightful owner. And if the rightful owner does not come forward and assert his title by process of law within the period prescribed by the provisions of the Statute of Limitations applicable to the case, his right is for ever extinguished, and the possessory owner acquires an absolute title." (emphasis added)
At 378, his Lordship concluded: "The Act … has it … in contemplation that compensation would be payable to every person deprived of the land resumed for public purposes. It could hardly have been intended or contemplated that the Act should have the effect of shaking titles which but for the Act would have been secure, and would in process of time have become absolute and indisputable, or that the Governor, or responsible Ministers acting under his instructions, should take advantage of the infirmity of anybody's titles in order to acquire his land for nothing."
Perry v Clissold involved a very different factual situation from the position here. Not only did Boiling have a documented entitlement to exclusive possession of Lot 2 in accordance with the terms of each of the 2007 and 2014 leases, ALF at all times exercised its right of ownership including its right to exclusive possession, subject only to the leases that it had granted to Boiling. Its grant of each of the leases to Boiling is irrefutable evidence of this.
In short, this was not a case where the true owner, or any other party with a right to the land, was unknown. Nor was it a case, as has already been pointed out, where there was any evidence that Dial A Dump had been granted a right to exclusive possession.
The primary judge, at [117], considered that, having regard to the requirements of the POEO Act, the fact that ALF and Boiling continued to hold the environment protection licences and that Dial A Dump did not "would be consistent with [Dial A Dump] carrying on the scheduled activities on Lot 2 for and on behalf of ALF and Boiling". Integral to his Honour's consideration were the provisions of the POEO Act, ss 48 and 258 and the fact that ALF and Boiling continued to hold the licences in respect of the activities carried on on Lot 2, from which his Honour considered it could be inferred that they were the occupiers of Lot 2, such occupation not being consistent with Dial A Dump occupying the premises in its own right.
There is another consideration of importance. If Dial A Dump's submission were correct, it would, as occupier of the premises at which the landfill and waste operations were carried on, be committing an offence contrary to s 48 of the POEO Act, the terms of which are set out above at [11]. If a choice is to be made between a party acting legally rather than acting illegally, then in the absence of any evidence of the latter, it is appropriate to proceed on the basis that the party is or was conducting itself lawfully. There was no evidence to contrary effect. Indeed, all the evidence pointed to ALF and Boiling not only being aware of their obligations under their licences, but structuring all of their dealings on that basis. The terms of the resolution of 30 June 2008 and the leases are evidence that they did so.
Although senior counsel eschewed any such argument, much of what Dial A Dump contended in relation to the legal title for which it argued required an assumption that the three entities, ALF, Boiling and Dial A Dump, did not in fact conduct themselves in accordance with the legal structures that they had erected. The "careful" recording of how the three entities would operate and the formal granting of leases from ALF to Boiling make any such assumption untenable, just as the terms of each of the leases, pursuant to which Boiling was granted exclusive possession of Lot 2, make Dial A Dump's submission that it had exclusive possession untenable.
There was no error of law in his Honour finding that Dial A Dump had not established that it had a legal interest in the property.

[18]

Primary judge's reasons: no equitable interest

His Honour held, at [84], that Dial A Dump had not established that it had an equitable interest flowing from any rights it had in relation to the Dial A Dump Industries Trust. In summary, his Honour's reasons were as follows.
His Honour held that Dial A Dump did not have any equitable interest in the lease of Lot 2 and noted, at [85], that it had not been established that the lease of Lot 2 commencing on 1 January 2014, which was on foot at the date of acquisition of Lot 2, was part of the trust fund. Even assuming that the lease commencing 1 January 2014 was part of the trust fund, his Honour, at [86], considered that Dial A Dump did not have any beneficial interest in Lot 2 or in any other trust property. As his Honour explained: "As at the date of acquisition of Lot 2, Boiling as trustee had not appointed any of the corpus of the trust to any person. None of the dates that could constitute the Vesting Day had occurred. Only from the Vesting Day did Boiling as trustee stand possessed of the Trust Fund in trust for the beneficiaries (see cl 4(1))."
His Honour, at [87], considered that the Dial A Dump Industries Trust could be described as a discretionary trust, and found, at [88], that Dial A Dump, as the object of a bare power of appointment: "… had no proprietary interest in those assets, but only a mere expectancy or hope that one day the power would be exercised in [Dial A Dump's] favour".
His Honour observed, at [89], that this "interest" was incapable of assignment, and that this in turn pointed against it being a proprietary interest.
His Honour concluded, at [90], that Dial A Dump, as at the date of acquisition of Lot 2, did not hold any beneficial interest in the whole or any part of the trust property, including in the lease of Lot 2, and therefore could not have had any equitable interest in the land.
His Honour, at [92], rejected Dial A Dump's submission that it had an equitable interest in land by reason of its right to enforce the due administration of the trust. Although accepting that Dial A Dump had such a right and that this right would have extended to having the trust property properly managed, his Honour held that the availability of an equitable remedy in respect of trust property does not confer an interest in any part of the trust property.

[19]

Dial A Dump's submissions

Dial A Dump contended that his Honour erred in seeking to trace the interest that it claimed through a discretionary trust where no appointments had been made. It submitted that its equitable interest arose by reason of a simple written declaration of trust contained in Boiling's resolution of 30 June 2008.
Dial A Dump further submitted that whether or not it had an equitable interest in Lot 2 on the acquisition date should not have been determined only by reference to whether the resolution of 30 June 2008 was effective to vest it with beneficial ownership in Lot 2. It submitted that a number of aspects of the relationship between it and ALF and Boiling were capable of supporting equitable remedies to enforce its possession and control over Lot 2.
First, Dial A Dump argued that its ability to seek remedies against ALF and Boiling did not wholly depend on its status as an object of the power of appointment under the Dial A Dump Industries Trust. It contended that the resolution of 30 June 2008, together with Dial A Dump taking steps to enter into possession and to engage in the operations on Lot 2, before and after the entry into the 2014 lease, would have made it unconscionable for ALF or Boiling to deny that it had an interest in Lot 2 on the acquisition date.
Secondly, Dial A Dump submitted that if the resolution of 30 June 2008 was effective as a declaration of trust over the leasehold interest for Dial A Dump's benefit, the parties conducted themselves until the date of acquisition as though the situation was unchanged. It contended that despite the absence of a resolution in relation to the 2014 lease, or other declaration of trust, that lease was also held on trust for it on the basis of the principles stated in Keech v Sandford (1726) Sel Cas Ch 61; (1726) 25 ER 223 and Chan v Zacharia (1984) 154 CLR 178; [1984] HCA 36. The appellant acknowledged that it had not claimed any equitable interest based on the principles in Keech v Sandford in the court below, but nonetheless submitted that the question whether the leasehold estate was held on trust for the appellant was "in play" before the primary judge.
Dial A Dump acknowledged that the fact that a lease is held on trust for a beneficiary does not entitle that beneficiary to occupation of the land. However, it submitted that the Trust Deed in this case entitled the trustee to place the appellant in possession of the land.

[24]

Equitable interest created by declaration of trust

Dial A Dump's submission that its equitable interest arose from a simple declaration of trust arising out of Boiling's resolution of 30 June 2008 must also be rejected as it suffers from a fundamental flaw. As his Honour found at [85], Boiling's resolution was made in respect of leases then on foot and thus could only apply to the 2007 lease. The 2014 lease, which created a new leasehold interest in the property in favour of Boiling, was the existing lease and therefore Boiling's only interest in land as at the date of acquisition. Boiling's resolution of 30 June 2008 did not govern or deal with the 2014 lease.
To overcome this hurdle, Dial A Dump relied on the rule in Keech v Sandford, in support of the proposition that it had an equitable interest in land under the 2014 lease. Keech v Sandford concerned a lease held on trust for the benefit of a minor. On expiry of the lease, the trustee sought renewal on behalf of the beneficiary, however, the lessor refused. The trustee then sought, and was granted, the lease for his own benefit. Lord King LC held that the trustee held the lease on trust, despite clear evidence of the lessor's refusal to grant it for the benefit of the beneficiary. He considered, at 62, that: "This may seem hard, that the trustee is the only person of all mankind who might not have the lease: but it is very proper that [the] rule should be strictly pursued, and not in the least relaxed; for it is very obvious what would be the consequence of letting trustees have the lease, on refusal to renew to cestui que use."
The principle in Keech v Sandford was considered by Deane J in Chan v Zacharia, describing the principle in terms that "a trustee of a tenancy who obtains a renewal of the lease for himself holds the interest in the renewed lease as part of the trust estate". His Honour noted, at 200, that: "… the 'rule' has been accepted as being applicable regardless of whether the original lease was renewable by right or custom or whether the lessor was willing to grant a new lease for the benefit of the trust or whether there would, in the circumstances, be nothing inequitable in the trustee obtaining a renewal of the lease for his own benefit. The rule has been extended, either in its strict or modified form, to persons under obligations arising from certain other fiduciary relationships … and to certain other relationships which are not fiduciary but are said to be special …"
Deane J turned his attention to whether the principle was an independent doctrine of equity relating to trustees of a tenancy or a "mere manifestation" of the general principle governing the liability of a fiduciary to account for personal benefit or gain. His Honour concluded, at 201, that it should not be seen as either: "The 'rule' in Keech v Sandford, is … a rule concerned with the operation of presumptions in the application of [the] general principle to particular types of property. 'In cases of both leases renewable by right or custom and of leases not so renewable the renewal is prima facie considered to have been obtained by virtue of the interest' under the prior lease: per Parker J, Griffith v Owen [1907] 1 Ch 195 at 204."
Deane J further observed in relation to the renewal of a lease by a trustee that the principle "depends partly on the nature of leasehold property and partly on some fiduciary relationship or duty … towards the persons who seek to have the trust declared": see Griffith v Owen [1907] 1 Ch 195 at 203, where Parker J observed that a trustee was never allowed to rebut the presumption that a renewed leasehold interest was held on trust, whereas, for example, a mortgagee may do so. Deane J, at 201, thus stated that the principle creates: "… an irrebuttable presumption … that the lease was obtained by use of the position of advantage which the trustee enjoyed as tenant at law, that is to say, by the use by the trustee of his fiduciary position, with the result that he holds the new lease as constructive trustee under the general principle governing the liability of a fiduciary to account for a personal benefit or gain."
Chan v Zacharia concerned a renewal of a lease that had been held by the partnership of which the appellant was a partner. The appellant refused to renew the lease and subsequently obtained a new lease in his own name. It was held that the appellant held the new lease as a constructive trustee for the partnership, in circumstances where the appellant held two roles in respect of the rights under the lease, one as trustee and one as a former partner, and both roles involved a fiduciary obligation.
If Dial A Dump's submissions based on Keech v Sandford and Chan v Zacharia were permitted to be raised for the first time on the appeal, Dial A Dump would be required to establish that Boiling was in a fiduciary position to it in respect of the 2014 lease.
The principles in relation to raising a new issue on the appeal are well established. As this Court stated in TAL Life Ltd v Shuetrim (2016) 91 NSWLR 439; [2016] NSWCA 68 at [165], it is not sufficient for an appellant to merely assert that a new point of law raised on the appeal could not have been met by evidence. It is also necessary for the appellant to demonstrate that the respondent would not have conducted the case differently at trial: see Sze Tu v Lowe (2014) 89 NSWLR 318; [2014] NSWCA 462 at [315]-[316].
Dial A Dump did not attempt to demonstrate that the case would not have been conducted differently if this argument had been raised in the court below. The submission went no higher than that his Honour should have applied the principle to the facts as found.
For its part, RMS submitted that it had conducted its cross-examination on the basis that no attempt had been made by Dial A Dump to assert an equity arising out of the 2014 lease. The only case made below was that because it was a beneficiary of a trust administered by Boiling and had a beneficial interest in the assets of the trust, including the 2009 lease of Lot 2, it had a beneficial interest in the land.
That there was no cross-examination relating to the 2014 lease is of particular importance in this case. Cross-examination may have resulted in additional relevant facts being found by the trial judge. As I explained in Bibby Financial Services Australia Pty Ltd v Sharma [2014] NSWCA 37 at [10]: "To blandly assert that the new point is based on facts as found by the trial judge overlooks that there may have been factors at play such that all facts, including those relevant to the new issue, were not necessarily decided at first instance. It would be unfair to require the party against whom the new point is taken to demonstrate that the facts found were not beyond controversy. The onus should rather be on the party seeking to raise the new issue to demonstrate that it is expedient in the interests of justice to allow the new point to be raised. In determining that question, the factors to which I have made reference will be relevant, having regard to the particular circumstances of the particular case."
For these reasons, Dial A Dump should not be permitted to raise this point on appeal. It did not discharge its onus of demonstrating that the case would not have been conducted differently had the point been raised at first instance. The very fact that Dial A Dump was required to prove that Boiling was in a fiduciary position to it in respect of the 2014 lease of itself demonstrated that there may have been facts relevant to that issue that were not proved or explored at first instance, as RMS' submission indicates.
Further, as Leeming JA, at [169] below indicates, it may be that an appellant in this Court will face a considerable hurdle in establishing an error of law in an appeal limited to a question of law, if the matter was not argued below. See, for example, Boele v Rinbac (2014) 88 NSWLR 381; [2014] NSWCA 451 at [14] per Basten JA and at [90] and [100] per Sackville AJA, although it is to be observed that the comments in that case were made in the context of judicial review and jurisdictional error.
As Dial A Dump acknowledged, the fact that a lease is held on trust for a beneficiary does not entitle that beneficiary to occupation of the land. In my opinion, no other equitable interest in land has been established. Dial A Dump has not demonstrated that his Honour erred in law in rejecting its contention that it had an equitable interest in land.

[26]

Primary judge's reasons: no "right, power or privilege"

His Honour held, at [123], that Dial A Dump had not established that, at the date of acquisition of Lot 2, it had, within the meaning of para (b) of the definition of "interest" in land, any "right, power or privilege" over or in connection with Lot 2 flowing from either any permission to carry on commercial operations on Lot 2 or the environmental protection licences held by ALF and Boiling.
His Honour, at [124], referred to his earlier holding that any permission given to the appellant to use or occupy Lot 2 was personal in nature and did not give rise to a proprietary interest. His Honour considered that such a permission was not a "right", "power", or "privilege" over or in connection with Lot 2 for at least the following five reasons.
First, his Honour held that the rights within para (b) needed to be proprietary or quasi-proprietary in nature, citing Hornsby Council v Roads and Traffic Authority of New South Wales (1997) 41 NSWLR 151 per Mason P (with whom Powell JA agreed) at 152; Meagher JA at 155 (with whom Mason P and Powell JA also agreed); and Golden Mile Property Investments Pty Ltd (in liq) v Cudgegong Australia Pty Ltd (2015) 89 NSWLR 237; [2015] NSWCA 100 per Emmett JA (with whom Macfarlan and Gleeson JJA agreed) at [107].
Secondly, in his Honour's view, this was supported by the nature of the rights that are listed in para (b): see the observation of Mason P in Hornsby Council v Roads and Traffic Authority at 152 that the context in which para (b) needs to be construed includes "the colour which each part of the overlapping definition takes from its associates". His Honour instanced, at [132]-[133], as examples of such rights: profits à prendre and profits à rendre; rights in the nature of profits à prendre, where, for example, an owner of land grants a licence to enter the land coupled with an interest in the land; and rent charges. His Honour pointed out, at [136], that a licence to carry out an activity on land gives the holder only a personal right whereas an easement or profit over or in connection with the land binds the land.
Thirdly, his Honour, at [140], considered that the conclusion, that rights within para (b) needed to be rights in the land of another was emphasised by the reference to "land" at the end of para (b), which indicated that there had to be an inherent relationship with the corporeal hereditament. His Honour considered that the personal permission that Dial A Dump had, did not have this inherent relationship with Lot 2.
Fourthly, his Honour, at [141], stated that the rights in para (b) must be capable of being owned. This, on his Honour's view, was central to the scheme of the Act, given that pursuant to s 37, only a person who is an "owner" of land is entitled to compensation. His Honour considered that the requirement of ownership of an interest in land limited the rights that fell within the definition of "interest in land" to those that were capable of ownership, citing Hornsby Council v Roads and Traffic Authority per Mason P at 152. His Honour observed, at [142], that the notion of "ownership", did not readily apply to a personal permission to occupy the land of another.
Finally, his Honour observed, at [143], that a person is not entitled to compensation unless that person is an owner of "an interest in land which is divested, extinguished or diminished by an acquisition notice": see s 37 of the Act. His Honour noted that in order for a right to be "divested, extinguished or diminished" by an acquisition notice published in the Gazette pursuant to s 37, the interest specified in the notice had to be one which had an inherent relationship with the land and this necessitated that the right be proprietary rather than personal.
Dial A Dump had also argued that it had an "interest in land" based on its permission to use the environment protection licences held by ALF and Boiling, which gave the appellant the "privilege" of carrying out what would otherwise be illegal activities. His Honour, at [146]-[150], did not accept that contention. His Honour considered that, under the relevant statutory scheme, ALF and Boiling could not grant permission to the appellant to use either of the environment protection licences and the appellant could not acquire the privilege of carrying on activities on Lot 2 without itself being the holder of a licence authorising those activities. His Honour concluded, therefore, that the appellant did not have any privilege falling within para (b).

[27]

Dial A Dump's submissions

Dial A Dump contended that his Honour misconstrued the meaning of "interest in land" in para (b) in the definition in s 4 of the Act. It submitted that the defined term, "owner", is given content by the statutory scheme and not the common law concepts of property or ownership. To this end, it was relevant, on Dial A Dump's submission, that an "interest in land" within para (b) includes "a right, … power or privilege over, or in connection with, the land". Dial A Dump submitted therefore that for the purposes of s 37, the "owner" is the "person that has that right, power or privilege". It contended that its rights, powers and privileges over Lot 2 were manifested in its possession of Lot 2 and its physical use of the property.
Dial A Dump also submitted that para (b) could extend to a merely personal right. The submission was made in the following terms: "An interest described or capable of recognition and description having obvious relative permanence and discernible or potentially assessable value individual to a particular person who can be shown to have been concerned in the enjoyment and exploitation of that right over a period of time consensually … is capable of and should be recognised as a right, power or privilege over Lot 2 and is not disqualified from being so recognised …"
Dial A Dump accepted that there would have to be some limitation placed upon a personal right being an "interest in land" within the meaning of para (b) such that there would have to be attached to such personal interest "qualities … that are within the purposes of the legislative". Dial A Dump contended, however, that a broad interpretation was required, but reiterated that the interest would have to be "within the compensation objectives of the Act".
Dial A Dump submitted that its activities in conducting its business with the active support of those with an acknowledged interest, namely, ALF and Boiling, were sufficient to give it a right, power or privilege in respect of the land. Dial A Dump contended that its construction of the definition in para (b) was in accordance with the scope, purpose and objects of the statutory scheme, the clear purpose of which was to make land available, free of impediment, to the acquiring authority. It was, Dial A Dump said, inconsistent with this purpose for any prior arrangement to survive the acquisition.
Dial A Dump also submitted that the words "divested", "extinguishes" or "diminished" in s 37 of the Act were not terms connoting transfer, and thus the primary judge's construction of the scheme as depending on an alienable interest was not consistent with the scope, purpose and objects of the Act. Further, it submitted that the court has in the past found interests in land that are not alienable: see Minister for Education and Training v Tanner (2003) 128 LGERA 281; [2003] NSWCA 164 at [15].
Dial A Dump submitted that there was a clear identity between the words used in s 37 of the Act and those used in s 20(1)(b). Section 20(1)(b) provides that land described in an Acquisition Notice is discharged from all "estates, interests, trusts, restrictions, dedications, reservations, easements, rights, charges, rates and contracts in, over, or in connection with the land". Dial A Dump submitted that the acquiring authority is thereby able to carry out the public purpose unimpeded. The corollary of this, on Dial A Dump's submission, was that the extinguishment of all possible impediments comes at a cost to the State, by way of the requirement for compensation.
Dial a Dump submitted that the approach of the primary judge impermissibly limited the ambit of para (b) of the definition of "interest" to proprietary and quasi-proprietary interests. Dial A Dump submitted that this approach did not recognise the breadth of the language of para (b). Dial A Dump also contended that the primary judge placed a gloss on the words of the definition of "interest in land" in para (b), which limited the scope of the definition and thus many of the operative provisions of the Act. Dial A Dump submitted that having regard to the statutory context and the principles of statutory construction regarding legislation that substantially interferes with property rights, limitations should not readily be read into words of wide import.
Dial A Dump submitted that the language of para (b) of the definition of "interest in land" is broad enough to encompass the activities that Dial A Dump carried out on Lot 2 as at the date of acquisition. It contended that the absence of a documented right of exclusive possession only meant that Dial A Dump could not establish a legal estate in Lot 2 for the purposes of para (a) of the definition of "interest in land". It stated that to repeat that test in respect of para (b) would give para (b) no work to do.
Dial A Dump also submitted that the primary judge failed to deal with its claim that it had "privileges" over Lot 2 by reason of it being able to carry out waste disposal and recycling operations by reference to the environment protection licences held by ALF and Boiling. Dial A Dump contended that the primary judge misstated its contention that it was able to use Lot 2 for its commercial purposes by reference to those licences.
Finally, Dial A Dump challenged the primary judge's reliance on Hornsby Council v Roads and Traffic Authority in order to find that it had only a "mere permission" to be present on Lot 2 and was thus outside the terms of para (b). Dial A Dump submitted that in Hornsby Council v Roads and Traffic Authority the process of reasoning used was so as to dispose of the unusual matter in issue. Further, relying on Minister for Education and Training v Tanner at [11], Dial A Dump further contended that Meagher JA's remarks in that case were not a substitute for the terms of the statute.
Dial A Dump submitted that what was said in Minister for Education and Training v Tanner may be sufficient to confine Hornsby Council v Roads and Traffic Authority to its particular facts. Dial A Dump also argued that there were aspects of the reasoning in Hornsby Council v Roads and Traffic Authority that were either wrong or incomplete. It contended that in making reference to s 37, Mason P did not address the fact that "owner" is a defined term, and that the approach taken by Meagher JA to statutory interpretation was incorrect. Dial A Dump also submitted that Meagher JA's concern with the negative effects on the machinery provisions of notifying holders of interests if a wide approach to the definition was adopted ignored the effect of s 12, which governs to whom a notice of acquisition must be given, and s 53, which relates to the position where compensation is paid to a former owner of land.
Dial A Dump also relied upon Sorrento Medical Service Pty Ltd v Chief Executive, Department of Main Roads [2007] 2 Qd R 373; [2007] QCA 73 to submit that, contrary to what had been held in Hornsby Council v Roads and Traffic Authority, a contractual right was sufficient to constitute an "interest in land" within para (b). Dial A Dump submitted that the Court should accept, on the uncontested evidence, that it was in possession of Lot 2 and was carrying out a substantial commercial enterprise on that land with the approval and permission of the landowner and tenant and thereby had an interest in Lot 2 as at the acquisition date.
In oral submissions, Dial A Dump resisted the proposition that it was carrying on its activities on behalf of a group rather than operating on its own behalf. Dial A Dump submitted there was not a 'group' in the "legal entity sense" and it could not have been said to have been acting as an agent of an unidentified entity without a legal personality. Dial A Dump submitted that no agency relationship between ALF and/or Boiling and itself should be imposed or imputed. This submission was consistent with its earlier submission that no finding of "agency" had been made by the primary judge. Dial A Dump also contended that there was, in fact, no agency relationship between it and ALF or Boiling. It submitted that the primary judge approached the fact-finding exercise by asking the wrong question: it contended that the primary judge asked whether the appellant could show a grant by ALF or Boiling of exclusive possession of Lot 2 or whether it could establish beneficial ownership by reference to documents. Dial A Dump contended that in so doing, the primary judge disregarded significant facts concerning the actual use of the site. Dial A Dump submitted that this led to the "absurd" result that despite the breadth of ss 20(1)(b) and 37 of the Act, his Honour's approach meant that nothing occurred on the acquisition of Lot 2 that affected Dial A Dump.

[28]

RMS' submissions

RMS pointed out that Dial A Dump bore the onus of establishing it was an "owner" of an "interest in land" at the date of the acquisition. It submitted that the personal permission that the primary judge held Dial A Dump had to use the land did not satisfy the definition of "interest in land" in para (b) of the definition. RMS submitted that to conflate every bare permission to a category of rights which were alienable and compensable was not what the statutory scheme was directed to. RMS further submitted that a permission is not a privilege because it cannot be asserted against another or used to achieve an immunity or advantage of a kind not available to others.
RMS supported the primary judge's approach to the construction of para (b) and submitted that it related only to proprietary or quasi-proprietary rights. Drawing on a number of authorities, RMS submitted that the following factors are significant in the characterisation of an interest as proprietary or quasi-proprietary: that the right-holder has significant control over the thing, including typically the right to use and enjoy the thing, and to exclude others; that it is definable and identifiable; that is has some degree of permanence and stability; that it is capable of being transmitted to another; and that it can be recovered by legal action, rather than merely obtaining compensation, and that these rights extend and apply against third parties holding the thing.
RMS submitted that there is a category of legal rights which may be proprietary or quasi-proprietary, which fall within para (b) but not para (a) of the definition, but which have a more "solid" character than a bare permission to enter or occupy. RMS did not accept that an interest in land within para (b) encompassed the interest for which Dial A Dump contended.
RMS further submitted that there was no conflict between the decisions in Hornsby Council v Roads and Traffic Authority and Minister for Education and Training v Tanner. It contended that acceptance of Dial A Dump's submission in respect of Hornsby Council v Roads and Traffic Authority would amount to a finding that Meagher JA's remarks, at 155, were plainly wrong on the basis that those comments formed part of the ratio of the decision. RMS submitted that the observations were correct or were, at the very least, not plainly wrong. RMS further submitted that there was no conflict between Hornsby Council v Roads and Traffic Authority and Sorrento Medical Service v Chief Executive, Department of Main Roads given the different statutory context under consideration in the latter case.
RMS also submitted that the present case is a poor one to test the limits of an "interest in land" in para (b) because all that is involved is a mere permission rather than a contractual right as was the case in Sorrento Medical Service v Chief Executive, Department of Main Roads. RMS pointed out that although described as a licence, the right in that case was a licence obtained for consideration in the context of a leasehold interest.
RMS further argued that there are textual indicia in the Act suggesting that the statutory scheme was not intended to extend to personal agreements or bare permissions. RMS supported the primary judge's approach contended that the requirement of "ownership" of an interest was significant, as was stated by Mason P in Hornsby Council v Roads and Traffic Authority. That is, the interest must be capable of ownership. RMS further submitted that the interest must be capable of divestment, extinguishment or diminishment by an acquisition notice: see s 37. Finally, it contended that the words "right" "power" and "privilege" must be read as standing with "easement" and "charge", which are things with a known and tangible legal character. RMS submitted that a personal right or permission does not possess these characteristics.

[29]

"Rights" "power" or "privilege": consideration

It is convenient to commence the consideration of the question whether Dial A Dump had an "interest in land" within the meaning of para (b) of the definition of "interest in land" by reference to the authorities that were in contention on the appeal commencing with Hornsby Council v Roads and Traffic Authority.
Hornsby Council v Roads and Traffic Authority concerned ss 4, 37 and 48 of the Act in the context of the compulsory acquisition of a portion of Observatory Park in Pennant Hills. The question that arose was whether the appellant Council was an "owner of an interest" in the park.
Meagher JA at 155 said, in the context of para (b) of the definition of "interest in land": "The sole, rather glancing, connection between the appellant and the land was that the Council had the 'care, management and control' of the land under s 344 of the Local Government Act 1919, and after the repeal of that Act, had 'control' of the land under s 48 of the Local Government Act 1993. Can such a right be the sort of 'right' which is referred to in limb (b) of the definition of 'interest'? His Honour held it could not, and I think he was right. Mr Tobias QC, learned senior counsel for the appellant, submitted that the words of par (b) were extraordinarily wide and should be interpreted literally. However, this could not possibly be correct. In a sense every member of the public has a 'right' over the land in question: he can go on it and have a picnic. But it was hardly intended that he could claim compensation on a resumption. If it were, the machinery of notifying holders of 'interests' would extend to infinity. Some limitation must be placed on the words. Whilst the rights which fall within par (b) must be wider than the rights which fall within par (a), I feel that they must be limited to jura in re aliena [limited rights of ownership] proprietary or quasi-proprietary rights less than a fully-fledged estate, that is, easements, charges, profits à prendre, profits à rendre, licences coupled with interests, etc."
Mason P agreed with Meagher JA and made some additional remarks at 152: "It is true that the definition of 'interest' is liberal, especially in its second part. But, as Meagher JA demonstrates, a literal interpretation produces absurdity, and the words cannot be construed out of context. Part of that context is the colour which each part of the overlapping definition takes from its associates. Even more critical to that context is the reference to ownership of an interest in s 37 of the Land Acquisition (Just Terms Compensation) Act."
Powell JA agreed with both Mason P and Meagher JA.
In Minister for Education and Training v Tanner, Brownie AJA, (Beazley and Santow JJA agreeing), said, at [11]: "What Meagher JA said in Hornsby was apt to resolve the issue posed in that case, but of course his Honour's words ought not to be treated as a substitute for or a restatement of the words of the legislation, and they need to be read in their context. It may be that on some future occasion it will seem appropriate to refine those words, if they are to be used for guidance in the resolution of other cases, but that is not necessary or appropriate now."
In Minister for Education and Training v Tanner, the respondent owned land in Balmain adjoining a public road. The appellant acquired the land on which the public road ran, but did not acquire any of the respondent's land. The outcome of the acquisition was that the respondent no longer enjoyed access from the road to his land and vice versa. The Court held that the interest held by the respondent fell within the ambit of s 4 of the Act. In coming to that determination, the Court relied upon the common law right of an owner of land adjoining a highway to access the highway from any part of the land: see Shellharbour Municipal Council v Rovili Pty Ltd (1989) 16 NSWLR 104 at 108-109 and cases cited therein. Brownie AJA observed at [15]: "… the common law treated the owner of land adjoining a highway as having rights over or in connection with that highway, and s 6 of the Land Acquisition Just Terms (Compensation) Act effectively restates this right. When one turns back to s 37 and to the definition of 'interest' in s 4 of the Land Acquisition Just Terms (Compensation) Act, it seems natural to say that such a land owner has a right over or in connection with the public road adjoining his or her land."
In Golden Mile Property Investments v Cudgegong Australia, Emmett JA (Macfarlan and Gleeson JJA agreeing), at [107], approved the approach taken to the meaning given to "interest in land" in Hornsby Council v Roads and Traffic Authority, in that "they must be limited iura in re aliena, proprietary or quasi-proprietary rights less than a fully fledged estate, that is, easements, charges, profits à prendre, profits à rendre, licences coupled with interests, etc". His Honour added: "Nonetheless, the breadth of the definition of 'interest' is such as to cover the rights of a purchaser in an uncompleted contract for the sale of land, even if it cannot yet be said that the purchaser would be entitled to a decree of specific performance."
In Sorrento Medical Service v Chief Executive, Department of Main Roads, the Queensland Court of Appeal considered the Acquisition of Land Act 1967 (Qld) and its application to land over which the appellant had car parking rights for its medical centre. The appellant had a lease of portion of the building on which the car park was located. It had been a term of the development consent for carrying on the medical practice that car parking be provided for patients and for doctors.
The relevant portion of the Acquisition of Land Act, s 12(5), was relevantly in the following terms: "On and from the date of the publication of the gazette resumption notice the land thereby taken shall be vested [in the] State … absolutely freed and discharged from all trusts, obligations, mortgages, charges, rates, contracts, claims, estates, or interest of what kind soever, … and the estate and interest of every person entitled to the whole or any part of the land shall thereby be converted into a right to claim compensation under this Act …" (emphasis in original)
"Interest in relation to land or other property" was defined in the Acts Interpretation Act 1954 (Qld), s 36 to mean: "(a) a legal or equitable estate in the land or other property; or (b) a right, power or privilege over, or in relation to, the land or other property." (McMurdo P's emphasis)
McMurdo P (Chesterman J concurring in allowing the appeal), considered that the appellant was entitled to compensation. Her Honour remarked at [14]: "… Giving the italicised words in s 12(5) their ordinary meaning and adopting the required reluctance before construing the Act as limiting compensation in a way outside its clear terms, it seems to me that 'interest' should be given its meaning in s 36 of the Acts Interpretation Act."
Her Honour observed that other compensation statutes in Australian jurisdictions had specifically adopted a comparable definition and expressly referred to the terms of s 4 of the New South Wales statute. It might be remarked here that the definition in s 36 of the Queensland Act did not include the words "easement, right [or] charge" as appears in the New South Wales legislation. However, leaving that to one side, her Honour observed that the contractual right to use the resumed land for parking, part of that right being exclusive to the appellant, was an apparently valuable right. This was in circumstances where it had been a term of the development consent for the use of the property that off-site parking be provided.
Her Honour concluded, at [14]: "Giving the words in the italicised phrase in s 12(5) their ordinary meaning, using the definition of 'interest' in relation to land in s 36 Acts Interpretation Act and construing those statutes so that ambiguities do not limit or qualify a right to claim compensation, I am satisfied that the appellant's apparently valuable contractual right to use the resumed land for car parking made it 'entitled to the whole or part of the resumed land' within s 12(5). The appellant company's interest in relation to the resumed land was converted under s 12(5) into a right to claim compensation under the Act."
Chesterman J, in allowing the appeal, referred to Meagher JA's remarks in Hornsby Council v Roads and Traffic Authority at [67] and said, at [68]: "His Honour's remarks must be understood in their context: a claim by a local authority for compensation for the resumption of Crown land which it was charged to manage and control and with respect to which it had no proprietary interest. They are not a substitute for the terms of s 12(5) of the Act. Moreover, as I have pointed out, his Honour's insistence that the rights the loss of which will give rise to a claim for compensation must be proprietary, is met in this case." (emphasis added)
At [71], his Honour remarked: "The extended definition would allow those who had a right over or in relation to land to claim compensation upon its resumption. But the right must be one which has a value: it must be a right of property. There is no reason to disagree with Meagher JA on that point … But I hope I have made it clear that I do not regard it as absurd to read the Act as conferring a right to claim compensation on those who have lost a valuable right of personal property by reason of the resumption of land."
There was no challenge to the decisions in Minister for Education and Training v Tanner or Golden Mile Property Investments v Cudgegong. Having regard to those authorities, it might be thought that there has been some development in the law since Hornsby Council v Roads and Traffic Authority such that interests which may not strictly be quasi-proprietary in nature, as described by Meagher JA in that case, fall within para (b) and thus constitute an "interest in land" as defined in the Act. This would be all the more so if Sorrento Medical Service v Chief Executive, Department of Main Roads has any persuasive force in respect of the New South Wales legislation, a question which is not necessary to decide.
Accepting that, on the basis of the New South Wales authorities, an "interest in land" within the meaning of para (b) is not as confined as was found in Hornsby Council v Roads and Traffic Authority, including on the view of Mason P, there remain two requirements in the legislation which are fundamental to the determination whether Dial A Dump had an "interest in land" within the meaning of para (b). The first requirement is that the power or privilege" must be "over or in connection with the land". The second requirement is that there must be an "owner" of the power or privilege such as to be entitled to compensation: see s 37.
Dial A Dump did not have any power "over or in connection with the land". "Power" involves an ability to control or direct. There was no evidence that Dial A Dump had any such power and indeed the evidence was to the contrary. Dial A Dump had no power to control or direct the grant of leases or licences over the land. That power remained in ALF and in Boiling subject to the terms of its lease. Dial A Dump's function was to conduct two particular businesses on behalf of the owners of those businesses. It could thus determine how the businesses were carried on, but it could not otherwise control or direct what went on on the land, except "on behalf of the Alexandria landfill group" as recorded in the minutes of 30 June 2008.
It is arguable that a permission to use land could constitute a "privilege in, over or in connection with land" within the meaning of para (b) of the definition of "interest in land". Whether that could be so would depend on the terms of the permission. Dial A Dump's permission to be on the land was for the purposes of the businesses that it was carrying on for ALF and Boiling. It was, on his Honour's finding, a permission personal to it. ALF and Boiling at all times had control of Lot 2, as owner, lessee and pursuant to their obligations as the holders of the POEO licences. Dial A Dump, at the most, had no more than the rights of an agent or a licensee to be on the property for the purposes of carrying on the business. I do not consider that that right gave it an interest in land as defined.
I am also of the opinion that for there to be a power or privilege within the meaning of para (b), that power or privilege must be capable of alienation. Otherwise, the concept of ownership as part of the statutory scheme, especially in s 37, would be superfluous insofar as a power or privilege over or in connection with the land was concerned. Dial A Dump had nothing that it could sell or transfer. Its rights were, as I have stated, no greater than its obligation to conduct the two businesses on behalf of ALF and Boiling for so long as those entities permitted it to do so.
My view on this is reinforced by the terms of s 20 and the balance of the terms of s 37. Section 20 provides that on the date of publication of the acquisition notice the land described in the notice is vested in the acquiring authority. There was no interest by way of a power or privilege over or in connection for which Dial A Dump contended that could vest in the Authority: such permission as Dial A Dump had to be on the land to carry on the businesses terminated when those businesses ceased operation on the land. That occurred when the land was compulsorily acquired. For the same reason, insofar as Dial A Dump was concerned, there was nothing that was "divested, extinguished or diminished".

[30]

Conclusion

It follows that the appeal should be dismissed with costs.
McCOLL JA: I have had the benefit of reading Beazley P's reasons in draft. I agree with the orders her Honour proposes and, subject to what appears below, with her Honour's reasons.
In this Court, Dial A Dump sought to raise an argument not relied upon before Preston CJ at LEC, that, applying Keech v Sandford, [1] it had an equitable interest under the 2014 lease. As the President has explained, [2] if permitted to raise that argument, Dial A Dump would be required to establish that Boiling was in a fiduciary position to it in respect of the 2014 lease.
Dial A Dump's appeal from the Land and Environment Court's decision is confined to an appeal "against an order or decision … of the Court on a question of law" pursuant to Land and Environment Court Act 1979 (NSW), s 57(1). The preeminent authority for determining the ambit of such an appeal is Metropolitan Water Sewerage and Drainage Board v Histon. [3] Although that case considered s 54 of the Government and Related Employees Appeal Tribunal Act 1980 (Cth), Samuels JA's analysis of the jurisdiction such a provision confers upon the Court of Appeal extends to provisions such as s 57(1) is well accepted. [4]
As his Honour explained, "the natural meaning of the relevant words … is that an appeal lies against any decision which the tribunal makes on a question of law … the ordinary meaning of this language is that an appeal lies against any decision of the tribunal which is a decision on a question of law". [5] It logically follows, that s 57(1) confers "judicial power to examine for legal error" [6] what has been done by the Land and Environment Court. The question of law is "not merely a qualifying condition to ground the appeal, but also the subject matter of the appeal itself". [7]
The effect of this, in my view, is that it is necessary that Dial A Dump identify a decision or order of Preston CJ at LEC on such a question, to enable this Court to exercise its appellate jurisdiction. It is not open to it to raise a fresh question on appeal. The principles in cases such as Suttor v Gundowda Pty Ltd [8] and Coulton v Holcombe [9] have no application at the jurisdictional stage.
Although the comments Basten JA and Sackville AJA made in Boele v Rinbac Pty Ltd, [10] were made in the context of judicial review and jurisdictional error, they have a compelling logic in the present context. On an appeal confined as in the present case, the appellant cannot identify a decision of the nature referred to in the previous paragraph as, obviously, Preston CJ at LEC did not "consider a point not raised before [him]". [11]
Further, if Dial A Dump was permitted to take the course it sought to pursue, s 57(1) potentially becomes an avenue by which persons aggrieved by the Land and Environment Court's decision could seek to engage this court's s 75A, Supreme Court Act 1970 (NSW) jurisdiction. That is not only "conducive to the orderly and efficient conduct of litigation", [12] but contrary to the language of s 57(1) as I have sought to explain and, in any event, inconsistent with authority. [13]
LEEMING JA: I agree with the orders proposed by Beazley P, and, subject to what follows, with her Honour's comprehensive reasons for those orders. I will not repeat the references to the factual background, the findings of the primary judge or the parties' submissions. Although some of Dial A Dump's submissions traversed the evidence, and advanced matters which had not been put at first instance, it is to be recalled that the appeal to this Court is confined by s 57(1) of the Land and Environment Court Act 1979 (NSW) to a question of law, and that there will seldom be an error of law if the primary judge failed to address a submission which has not been put.

[31]

Legal interest in the land?

Dial A Dump submitted that on the facts as fully found, the primary judge erred in not finding that it had a legal interest in the land, by reason of its exclusive possession of the site.
The primary judge framed his findings in terms of failing to be satisfied that Dial A Dump had the relevant interest. His Honour said at [121]-[122] that: "Hence, the conduct and financial arrangements of ALF, Boiling and [Dial A Dump] concerning the carrying on of the commercial operations on Lot 2 do not establish conclusively that [Dial A Dump] had been granted any proprietary interest in Lot 2, including being given exclusive possession of Lot 2. In these circumstances, [Dial A Dump] has not established that it was granted by Boiling or ALF any proprietary interest in Lot 2 that amounted to a legal interest in land within par (a) of the definition of 'interest in land'."
That reflected the somewhat exiguous nature of the evidence relied on. The legal conclusion for which Dial A Dump contended was either inconsistent with the contemporaneous documents, or (at best) was less than clearly established by those documents. For example: 1. The formal document governing relations between the land owner ALF and its tenant Boiling, at the time of the Gazettal of the acquisition notice, was an unregistered lease, which confirmed that exclusive possession had been given to Boiling, which was to pay $100,000 plus GST annually by way of rent. There was no challenge to the findings of the primary judge that Boiling was forbidden from transferring its interest under the lease, or parting with possession, without ALF's written consent (cll 10.1, 10.7). 2. There were documents stating that Dial A Dump was conducting operations for and on behalf of ALF and Boiling. Notably, note 4 of the critical minute of 30 June 2008 of ALF (at [15] above) provided that Dial A Dump would commence commercial operations of landfilling, recycling, waste transfer and collections, which "will be done for and on behalf of the Alexandria Landfill consolidated tax group". The fact that, as the primary judge found, Dial A Dump used labour supplied by Boiling in order to perform those functions, tends to confirm the fact that it was not acting as principal in its own right. 3. The primary judge found that the business being conducted on the land required use of both environmental licences held by ALF and Boiling. If Dial A Dump was conducting the business on its own behalf, as opposed to doing so on behalf of the entities licensed to do so, then it was guilty of an offence under the Protection of the Environment Operations Act 1997 (NSW). As his Honour said at [117]: "Under s 48 of the POEO Act, each person who is an occupier of premises at which scheduled activities are carried out is required to be a holder of a licence authorising that activity to be carried on at those premises. Hence, it can be inferred from the fact that ALF and Boiling continued to hold environment protection licences that they were the occupiers of Lot 2 on which the scheduled activities were carried out: see also s 258 of the POEO Act. This occupation of Lot 2 by ALF and Boiling is not consistent with [Dial A Dump] occupying Lot 2 in its own right. If DADI had been the occupier of Lot 2, it was required to have held an environment protection licence authorising the scheduled activities carried on at Lot 2. However, the fact that ALF and Boiling continued to hold the environment protection licences, but [Dial A Dump] did not, would be consistent with [Dial A Dump] carrying on the scheduled activities at Lot 2 for and on behalf of ALF and Boiling."
A related difficulty is that some of the contemporaneous documents are expressed a little informally. Thus: 1. Two documents, being minutes of meetings of 11 April 2006 (Blue 133) and 30 June 2008 (Blue 289), describe Ms Larissa Malouf as one of two directors of Boiling. 2. Another two documents, namely, a "Resolution of the Sole Director" dated 13 June 2007 (Blue 228) and the (unregistered) lease dated 7 February 2014 (Blue 293), Ms Malouf is described as Boiling's sole director.
Finally, it seems clear that at least some of the documents have been drafted with an accounting or tax treatment in mind, rather than with a view to precisely defining the legal relations between ALF, Boiling and Dial A Dump. In particular, the restructuring appears, on its face, designed to avoid a stamp duty liability concerning a proposed buy in transaction ("The new structure facilitates a 'buy into' the Alexandria landfill Group by Swire. [If Swire cannot buy the bin business from the trust there will be stamp duty liability for Swire]") (Blue 273P).
All of those matters sustain the primary judge's finding that Dial A Dump had not established primary facts sufficient to sustain a legal interest in the land. In short, I do not consider that there is an error of law in failing to be satisfied that Dial A Dump lacked exclusive possession, given the nature of the documents and the consequence that if it did, Boiling was in breach of its lease and ALF and Boiling were in breach of their environmental licences.

[32]

Equitable interest in the land?

Dial A Dump maintained that it had an equitable interest in the land (either under a trust, or because aspects of the relationship between it and ALF and Boiling "were capable of supporting equitable remedies to enforce [Dial A Dump's] possession and control over Lot 2").
In its submissions in reply, Dial A Dump said that: "[O]n 30 June 2008 Boiling had resolved that the lease granted to it by ALF would henceforth be held upon trust for [Dial A Dump]. A further lease granted by ALF to [Dial A Dump] in 2014 was also held on trust for [Dial A Dump]. [Dial A Dump] as beneficiary was entitled to enter into occupation of the premises the subject of the lease, and enjoy for itself the rights of exclusive possession conferred thereby. ... Further, if the internal corporate arrangements, which otherwise suited all parties involved, was nevertheless treated as being disputed, the conclusion that [Dial A Dump] would be without any kind of arguable remedy should not be adopted in this Court." (sic, original emphasis)
I agree with what Beazley P has said in relation to this ground. Without detracting from her Honour's reasons, I note the following difficulties with this submission. 1. First, a declaration of trust of a lease does not give the beneficiary a right to possession. 2. Secondly, the 2008 declaration is not to the point, because it was the 2014 lease that was extant at the time the land was acquired. 3. Thirdly, the argument advanced for the first time on appeal - in a footnote in written submissions in reply - relied upon Keech v Sandford (1726) Sel Cas Ch 61 in order to support an equitable interest in respect of the lease said to have been granted to it in 2014. Dial A Dump should not be permitted to raise this submission. 4. Fourthly, it would appear that s 304(1) of the Duties Act 1997 (NSW) precludes this Court (or the primary judge) from using the 2008 resolution by Boiling "for any purpose", because it had not been duly stamped. 5. Fifthly, the interest of a discretionary object, which includes the right to due administration of a trust, falls short of an equitable interest for the purposes of the Act. 6. Sixthly, to the extent that Dial A Dump maintained that it enjoyed an equitable interest because it would have been able to seek injunctive relief if its activities on the site were interfered with, what has already been said means that this does not suffice.

[33]

Right, power or privilege?

In support of the third way in which an interest was asserted, based on there being a right, power or privilege relating to the land, Dial A Dump pointed to its claimed possession and the activities it was said to be carrying out on the land. It submitted that there was no requirement to find a proprietary or quasi-proprietary interest in the land, contrary to what had been held in Hornsby Council v Roads and Traffic Authority of New South Wales (1997) 41 NSWLR 151 at 155.
Dial A Dump invited this Court to follow the Queensland Court of Appeal decision, by majority, in Sorrento Medical Service Pty Ltd v Chief Executive, Dept of Main Roads [2007] 2 Qd R 37; [2007] QCA 73. It is not necessary to reach a firm conclusion, but the following matters tell against Dial A Dump's submission. 1. First, the statutory language in the Queensland legislation is different, in that the definition of interest does not include the proprietary words of "easement" and "charge". The unambiguously proprietary terms "easement" and "charge" are apt to colour the scope of the more generic terms of "right", "power" and "privilege". 2. Secondly, the definition of "interest" is found in the New South Wales Act itself (in contrast with the different definition being located in s 36 of the Acts Interpretation Act 1954 (Qld)), and is to be read in connection with the right conferred upon "An owner of an interest in land" in s 37. The reference to 'owner' tends to support a requirement that the interest be proprietary or quasi-proprietary. 3. Thirdly, regard should be had to the difference between the limited words in the definition of "interest" and the broader words in s 20(1)(b) which includes "contracts in, over or in connection with the land" (a similar observation was made by Holmes JA, as her Honour then was, in Sorrento at [19]). The variation in statutory language suggests, to say the least, that the class of rights from which acquired land is freed under s 20(1)(b) is broader than the class of interests which attract a right to compensation, and that in turn has a bearing upon the meaning which is to be given to the definition of 'interest'. 4. Fourthly, it seems clear from the discussion of "'Common law' and statute" at [29]-[35] in Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority (2008) 233 CLR 259; [2008] HCA 5 (coincidentally, also a compulsory acquisition case) that the deference to other intermediate appellate courts associated with Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89; [2007] HCA 22 is inapplicable.
But it is not necessary, in order to resolve this appeal, finally to determine this point. There was no error of law in finding that Dial A Dump did not enjoy a valuable contractual right. It was not a contractual right, because its possession of the land came about by reason of permission or sufferance of either or both of the owner or lessee of the land. It was not a valuable right, because the right was terminable without notice at any stage. Dial A Dump made no response, nor could a response be made, to the submission that such rights which Dial a Dump enjoyed were terminable at will by act of the sole director and shareholder of its parent company ALF. It is therefore unnecessary to seek to resolve such conflict as exists between the decisions of this Court and of the Queensland Court of Appeal.
The orders proposed by the President should be made.

Dial A Dump Industries Pty Ltd v Roads and Maritime Services

At a glance

Court

Decision date

Before

Source

Judgment (34 paragraphs)

Parties

Legislation Cited (11)

Cases Cited (48)

Cited By (14)