Etwell & Anor v Newcastle City Council

30 The Defendant urges that the Court should not, in the exercise of its discretion, change the Plaintiffs' use of the servient tenement from a mere permission into a legal right. Mr Fraser, who appears for the Defendant, in his helpful argument strongly submits that the servient tenement is community land reserved for public purposes and that there is no need to change the Plaintiffs' ability to use it, in common with other members of the public, into a private right. He says that such a change would be inconsistent with the public interest which the Court is required expressly by s.88K(2)(b) to consider. 31 The Court never makes an order under s.88K(1) lightly. The Court must be particularly cautious when the proposed servient tenement over which the easement is sought is community land. That land has been designated as being retained for the benefit of the public for the indefinite future. Its appropriation for private use by recourse to s.88K must be jealously scrutinised. 32 The Plaintiffs' solicitor, Mr Harvey, in his capable submissions, places strong reliance on the decision of Bryson J in Marshall v Council of the City of Wollongong, in which the Court made an order under s.88K(1) granting an easement over community land. On the other hand, Mr Fraser says that the facts of that case were significantly different from the facts of this case. In Marshall the community land over which the plaintiff sought an easement was, by virtue of its difficulty of terrain and its environmental sensitivity, such that it was not practical for the council to develop it for any form of use by the general public: see esp. at p.79. 33 The servient tenement in the present case could not be said to fit that description. It is certainly conceivable that at some time in the future the Defendant will wish to put the servient tenement to a particular use which will conflict with the easement which is now sought by the Plaintiffs. 34 I do not think that it is in the public interest that an easement be created under s.88K(1) over community land so as to confer private rights which are any greater than they need to be to meet the uses to which both the dominant tenement and the servient tenement are put at the time of the order.. 35 Under s.88K(3) the Court is to approve the terms upon which the easement is created. In the present case the Plaintiffs volunteer a term to the effect that if they redevelop or subdivide their Property in the future they will release the easement. This is an entirely appropriate term to protect against the unnecessary retention of a private right over public land. If the Plaintiffs redevelop the Property, it will be up to them to do so in a way which permits them access to the rear of the Property without recourse to public land. 36 However, I would go further to protect the public interest. As a condition of making an order under s.88K, I would require the Plaintiffs to consent to the inclusion of a term in the easement to the effect that if the Defendant requires the servient tenement for a particular use which is inconsistent with retention of the easement, the Plaintiffs will release the easement to the extent necessary to give effect to that purpose. If this condition also is embodied in the terms of the easement, I am satisfied that the easement will not be inconsistent with the public interest as required by s.88K(2)(b). 37 Finally, on the issue of discretion I have had regard to two objections from members of the public to the creation of the proposed easement. Both of those objections misconceive the use and extent to which the servient tenement would be put if the easement is granted. I do not think that those objections should be given any weight in the exercise of the Court's discretion. Compensation

38 Section 88K(4) requires the Court to order the applicant to pay compensation to the owner of the servient tenement "unless the Court determines that compensation is not payable because of the special circumstances of the case". In the present case, the parties' valuers have valued the servient tenement at $10,900. However, the Defendant concedes that if, as is proposed, the easement not be granted in perpetuity but, rather, is to be extinguishable in certain circumstances which are highly likely to occur at some time in the future, then it is not appropriate to order payment of a lump sum as compensation. Rather, the Defendant submits that something akin to an annual licence fee should be paid for the duration of the easement. The Defendant suggests the sum of $520 per annum. 39 The Plaintiffs, by the terms of the easement, propose to make themselves liable for the maintenance of that part of the servient tenement over which the easement is to run. They offer to indemnify the Defendant in respect of claims and liabilities arising in respect of the grant of the easement. 40 I take into account that the terms of the proposed easement give the Defendant rights and benefits which it did not have in respect of the use of the servient tenement over the past forty-six years. I take into account that the Defendant cannot use the servient tenement for any commercial purpose, nor can it otherwise derive a rent or commercial benefit from it. No cost or other disadvantage has been suggested by the Defendant as flowing from the grant of the easement in the terms proposed by the Plaintiffs, particularly as the easement will be released when the Defendant commences construction of a development on the servient tenement, or puts it to a particular use, which is in conflict with the continued existence of the easement. 41 It seems to me that there are special circumstances in this case which justify the conclusion that no compensation should be ordered. In my view, the Defendant will be sufficiently protected by the grant of rights and benefits in respect of the servient tenement and ought not to receive in addition a windfall in the guise of compensation for a loss or damage which it will not suffer. Costs

42 The Plaintiffs submit that there should be a departure from the usual order for costs which is envisaged by s.88K(5). They say that this was a case in which negotiation to achieve a reasonable result was impossible because the Defendant had no power to accede to their request. Accordingly, recourse to the Court under s.88K was the only means whereby the Plaintiffs could achieve their object in obtaining the easement. 43 I do not regard this as a sufficient reason for departing from the usual order for costs which is stipulated in s.88K(5). Certainly, this is a case where it was necessary to come to the Court for the grant of the easement proposed; the Defendant could not have avoided the costs of the application by agreeing to the Plaintiffs' request for an easement, no matter how much it would have liked to do so. 44 However, it remains the fact that the Plaintiffs are seeking a private right over public land - a right which is not available unless an application to the Court is made under this section. It does not seem to me appropriate or fair that the Defendant, and therefore the public purse, should bear the cost of the Plaintiffs seeking and obtaining a private right for their own benefit. 45 I do not think that this is a case which is outside the considerations which lead to the usual order for costs stipulated in s.88K(5). Accordingly, the costs order which I will make in these proceedings is that the Plaintiffs pay the Defendant's costs of the application. Orders

46 Because it will be necessary for the Plaintiffs to reformulate the terms of the easement to incorporate the additional provision to which I have referred in the judgment if they wish the order to be made, I will stand these proceedings over for a short time to enable the Plaintiffs to bring in Short Minutes of Order. If those Short Minutes of Order are acceptable to the Defendant then there is no necessity to come back to me for the making of final orders. The matter can be finalised by consent orders before the Registrar. 47 Accordingly I will, in the first instance at least, stand the matter over to the Registrar's list at a time to be agreed. If there is any difficulty in formulating the Short Minutes of Order, the matter may be brought back to me by application to my Associate.

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