Eleventh Ave 200 Pty Ltd v Lal

Legislation Cited: Conveyancing Act 1919, s 88K
Land and Environment Court Act 1979, ss 34, 40
State Environmental Planning Policy (Precincts – Western Parkland City) 2021, Appendix 4

Cases Cited: Moorebank Recyclers Pty Ltd v Tanlane Pty Ltd (2012) 16 BPR 31,257; [2012] NSWCA 445
Rainbowforce Pty Limited v Skyton Holdings Pty Limited (2010) 171 LGERA 286; [2010] NSWLEC 2
Shi v ABI-K Pty Ltd (2014) 87 NSWLR 568; [2014] NSWCA 293
UPG 224 Pty Ltd v Liverpool City Council​ ​​[2023] NSWLEC 1466

Category: Principal judgment

Parties: Eleventh Ave 200 Pty Ltd (Applicant)
Raymond Prakas Lal (First Respondent)
Vaneeta Praveena Lal (Second Respondent)

Representation: Counsel:
A Knox (Solicitor)(Applicant)
R Lal (Self Represented) (First Respondent)
V Lal (Self Represented) (Second Respondent)
Solicitors:
Pikes and Verekers (Applicant)

File Number(s): 2024/00334995

Publication restriction: Nil

JUDGMENT

1. These proceedings concern an easement for drainage of water burdening part of the Respondents’ property at 205 Tenth Avenue Astral (Lot 847 DP2475) (205 Tenth) and benefiting the Applicant’s property known as 200 Eleventh Avenue, Austral (Lots 805 and 806 DP 2475)(200 Eleventh)( Proposed Easement).

2. The Applicant has development consent from the Court for a Torrens title subdivision of 200 Eleventh into 38 residential lots and two E4 Environmental Living Superlots (giving 40 lots in total), construction of public roads and stormwater drainage (UPG 224 Pty Ltd v Liverpool City Council [2023] NSWLEC 1466) (Consent).

3. The Consent is subject to a deferred commencement condition for an easement over 205 Tenth in the following terms:

“Pursuant to the previous (sic) of Section 4.16(3) of the Environmental Planning and Assessment Act 1979, a deferred commencement consent is granted to development application no. 702,2022 subject to completion of the following:

a. evidence is provided to Council of the registration of an easement to drain water burdening Lot 847 DP 2475 – 205 Tenth Avenue, Austral and benefiting Lots 805 and 806 DP 2475 – 200 Eleventh Avenue, Austral…

The above requirements must be satisfied within 5 years of this determination or the consent will lapse.”

4. 205 Tenth is presently burdened by an easement to drain water (30 wide) benefitting Liverpool City Council (the Council Drainage Easement). DP64257 identifies this easement as being located diagonally across 205 Tenth, and running from the southeast corner of the lot to approximately midway along the western boundary.

5. The Council Drainage Easement provides drainage rights over an unnamed creek being a tributary of Kemps Creek. The Applicant proposes to drain water into the Council Drainage Easement via the Proposed Drainage Easement.

6. Under Appendix 4 to State Environmental Planning Policy (Precincts – Western Parkland City) 2021, 205 Tenth is zoned E4 Environmental Living, SP2 Infrastructure (Local Drainage) and RE1 Public Recreation. 200 Eleventh is zoned R2 Low Density Residential and E4 Environmental Living.

7. The Court arranged a conciliation conference under s 34(1) of the Land and Environment Court Act 1979 (LEC Act) between the parties, which was first held on 24 February 2025. I presided over the conciliation conference.

8. The parties now propose resolution of the proceedings in accordance with the terms outlined in their executed s 34 written agreement dated 4 April 2025 (Agreement).

9. Under s 34(3) of the LEC Act, I must dispose of the proceedings in accordance with the parties’ signed agreement if the Court could have made that decision in the proper exercise of its functions.

10. The pre-conditions that must be satisfied before the Court can exercise its functions are identified in a written submission by the parties.

11. After a consideration of the submission I am satisfied, based on the evidence before me, that the agreement of the parties is a decision that the Court could have made in the proper exercise of its functions for the following reasons.

Preconditions to the exercise of the power to make the proposed orders

12. The Court has power to impose an easement over land pursuant to s 40 of the LEC Act and s 88K of the Conveyancing Act 1919. The power under s 40 of the LEC Act is invoked when an appeal of the kind referred to in s 40(1) is pending or has been determined and the applicant in such an appeal makes an application to the Court under s 40(2) for an order imposing an easement.

13. Section 40(1)(a) is satisfied by the Class 1 judgment in ​​UPG 224 Pty Ltd v Liverpool City Council​ ​​[2023].

14. The Court, in dealing with an application under s 40(2) of the LEC Act, pursuant to s 40(4) “may exercise the jurisdiction of the Supreme Court under section 88K of the Conveyancing Act 1919 and, in that event, section 88K of the Conveyancing Act 1919 applies to the Court’s exercise of that jurisdiction in the same way as it applies to the exercise of that jurisdiction by the Supreme Court”.

15. A summary of the matters to be considered in determining whether to impose an easement is set out in Chief Judge Preston’s decision of Rainbowforce Pty Limited v Skyton Holdings Pty Limited (2010) 171 LGERA 286; [2010] NSWLEC 2 (Rainbowforce) at [19]:

“19 As noted in Khattar v Wiese [2005] NSWSC 1014 at [2], on an application under s 88K of the Conveyancing Act, the issues which arise are:

(a) Is the proposed easement reasonably necessary for the effective use or development of the applicant’s land that will have the benefit of the easement (s 88K(1))?

(b) Will the use of the applicant’s land having the benefit of the easement not be inconsistent with the public interest (s 88K(2)(a))?

(c) Can the owner of the land to be burdened by the easement, and each other person having an estate or interest in that land, be adequately compensated for any loss or other disadvantage that will arise from imposition of the easement (s 88K(2)(b))?

(d) Have all reasonable attempts been made by the applicant to obtain the easement or an easement having the same effect, but have been unsuccessful (s 88K(c))?

(e) If yes to each of the foregoing questions, should the Court exercise its discretion to impose an easement (s 88K(1))?

(f) Unless there are special circumstances of the case, what compensation is appropriate to be ordered (s 88K(4))?

(g) Is there any reason why the costs of the proceedings should not be paid by the applicant (s 88K(5))?”

16. More recently, in the decision of Shi v ABI-K Pty Ltd (2014) 87 NSWLR 568; [2014] NSWCA 293 the Court of Appeal articulated that the “critical element” in s 88K is the requirement that the easement be “reasonably necessary” for the effective use or development of the land sought to be benefitted. More particularly, at [6]:

“6 … Whether or not the condition is satisfied in a particular case is likely to require consideration of the following factors:

(a) the capacity of the developer’s land for use or development of particular kinds;

(b) the nature of the specific proposed development;

(c) the manner in which the proposed development is to be effected;

(d) the effect of the easement, if granted, on the servient tenement.

That is not to suggest that each factor is separate and distinct; clearly they will overlap.”

17. Notwithstanding the satisfaction of all the requirements in s 88K(1) and (2), it still remains within the discretion of the Court whether to make an order imposing an easement (Rainbowforce at [133]).

Reasonable Necessity

18. The test of reasonable necessity is not whether an easement is reasonably necessary for a specific development to have effect in accordance with a consent, but rather whether the easement is reasonably necessary for the effective use or development of the land that will have the benefit of the easement (Rainbowforce at [17]), that is; “something more than mere desirability or preferability over the alternative means available” (Rainbowforce at [76]), Moorebank Recyclers Pty Ltd v Tanlane Pty Ltd (2012) 16 BPR 31,257; [2012] NSWCA 445 (Moorebank Recyclers) at [154]). On the present facts and taking into account the determination of the Court in UPG 224 Pty Ltd v Liverpool City Council​ ​​[2023] I am satisfied that the proposed development is one that is appropriate to the area in which the land is situated. I am also satisfied that there is no evidence or suggestion that the easement would significantly deleteriously affect the servient tenement (Moorebank Recyclers at [114]).

Public interest

19. In the circumstances, I accept that the proposed development of the benefitted land is a permitted purpose under Appendix 4 to State Environmental Planning Policy (Precincts – Western Parkland City) 2021 and there is nothing in the proposed easement that would be inconsistent with the public interest.

Adequate compensation

20. The Court must be satisfied that the owner of the land to be burdened, and other persons having an estate or interest in the land, can be “adequately compensated for any loss or other disadvantage that will arise from imposition of the easement” in accordance with s 88K(2)(b) of the Conveyancing Act. Ordinarily, compensation will have three elements, (a) the diminished market value of the affected land; (b) associated costs that would be caused to the owner of the affected land; and (c) an assessment of compensation for insecurity and loss of amenities, such as loss of peace and quiet (Rainbowforce at [111]). Further, the addition of the words “or other disadvantage” provides for compensation for disturbance beyond the actual value of the proprietary right taken.

21. The only valuation evidence before the Court is a “Valuation Report” prepared on behalf of the Applicant by Lunney Watt & Associates Pty Ltd (included at Tab 4 to the Class 3 Application). The valuation report assesses the compensation payable for the easement in the sum of $59,625.

22. The parties have agreed that the Applicant will pay the Respondents a total amount of $165,000 which exceeds the amount determined in the Valuation Report. Therefore, in my assessment the owner of the burdened land will be adequately compensated for any loss or disadvantage arising from the imposition of the easement and the quantum of compensation is adequate for the purposes of s 88K(2)(b) of the Conveyancing Act.

Reasonable Attempts

23. Before seeking an order from the Court, an applicant is required to take reasonable steps to obtain an easement.

24. In this case I am satisfied of the Applicant’s reasonable attempts to obtain the easement as detailed in the Statement of Facts and Contentions at par 10 and the Affidavit of Alistair William Menteith Knox sworn on 10 January 2025. In short, the requirements of s 88K(2)(c) of the Conveyancing Act have been met, the Applicant has made reasonable attempts to obtain the easement.

Conclusion and orders

25. Accordingly, as the parties’ decision is within power I now dispose of the proceedings in accordance with that decision.

26. The Court orders that:

27. An easement is imposed, under s 40(2) of the Land and Environment Court Act 1979, in the form of Annexures A and B (the Easement) over Lot 847 in Deposited Plan 2475 (burdened land) for the benefit of Lot 805 and 806 in Deposited Plan 2475 (benefitted land), being an easement to drain water 6 metres wide and 42.42 metres in length.

28. The Applicant must, within 28 days of the entry of these orders, deliver to the Respondents a dealing in registrable form in the same form as Annexure A incorporating the Easement.

29. The Respondents must, within 14 days of that delivery, execute and deliver to the Applicant that dealing.

30. If the Respondents do not comply with Order (3) the Registrar is authorised to sign a dealing in registrable form in the same form as Annexure A hereto incorporating the Easement in the name of the Respondents.

31. Pursuant to s 88K(4) and (5) of the Conveyancing Act 1919 as applied by s 40(4) of the Land and Environment Court Act 1979, the Applicant pay the Respondents compensation for the Easement, and costs of the proceedings, in the sum of $165,000.

S Dixon

Senior Commissioner of the Court

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Annexure A

Annexure B

Amendments

08 May 2025

Typographical error corrected at [1] and [22].