First Plaintiff v Defendants

3 The Covenant in the transfer is, so far as material, a restriction on the use of the Land for residential purposes, and prevents the erection of more than one house (which expression is - delightfully - defined to include a pair of houses) and purports to require the house to be built of brick and to cost not less than £1,000 ("the Covenant").

4 By order dated 20 September 2012, Zammit AsJ ordered the plaintiffs to give notice of the proceeding to each of the persons interested in each of Lots 4 to 14 of Plan of Subdivision No. 7320.

5 This order is the usual order made in accordance with s 84(3) of the Property Law Act 1958 (Vic) ("the Act"). That section provides:**

(3) The Court may before making any order under this section direct such inquiries (if any) to be made of any local authority or such notices (if any) whether by way of advertisement or otherwise to be given to such of the persons who appear to be entitled to the benefit of the restriction intended to be discharged, modified or dealt with as, having regard to any inquiries, notices or other proceedings previously made given or taken the Court thinks fit.

**6 Lots 4 to 14 in Plan of Subdivision No. 7320, referred to in the Order of Zammit AsJ, are the lots identified in the affidavit of Mr Simon John Libbis sworn 4 September 2012, and in the exhibits to that affidavit, which appear to be entitled to the benefit of the Covenant. Mr Libbis is the solicitor for the plaintiffs.

7 Ms Toni Samuel is registered proprietor of the land in Certificate of Title Vol 11080 Folio 427. That certificate of title is in evidence as a part of exhibit "SL-4" to the said affidavit of Mr Libbis, which was referred to by counsel for the plaintiff, Mr N. Jones without objection, and shows the following:**

(a) that it is burdened with the Covenant;

(b) that it is derived from Lot 1 of Plan of Subdivision 7320.

**8 That title, and the accompanying intermediate Plan of Subdivision (PS 516951S), establish conclusively that Lot 1 on Plan of Subdivision 7320 is one of the lots burdened by the Covenant as referred to in Transfer 856912.

9 Mr Jones submitted that by reference to the terms of the Covenant and the legal principles applicable to the existence of such a restrictive covenant as is contained in Transfer 856912, that it is impossible for the Land derived from one of the lots burdened by the Covenant also to have the benefit of the Covenant. That is, one piece or parcel of land cannot be both the dominant and servient tenement.[1] This is a proposition basic to the law of restrictive covenants since Tulk v Moxhay.[2] Further he pointed to the words of the Covenant as showing that the burdened Land, Lots 1, 2 and 3, on PS 7320 were so burdened for the benefit of all the other lots on that plan of subdivision, namely lots 4 to 14.

10 Ms T. Acreman, counsel for the defendants, submitted that for present purposes all that needs to appear is that Ms Samuel is a person who appears to be entitled to the benefit of the restriction, in the sense that a mere possibility of an entitlement is sufficient for the purposes of s 84(3) of the Act.

11 In my view, the evidence disclosed in the affidavit of Mr Libbis, and in the exhibits to that affidavit, establishes clearly that Ms Samuel's land is burdened and not benefitted by the Covenant and that she has no right to object to any discharge or modification of the covenant in so far as it effects the Land. That is because her land is derived from Lot 1 on PS7320, which was one of the lots burdened with the Covenant.

12 For these reasons I am persuaded that the Notice of Appearance of Ms Toni Samuel should be struck out as the plaintiffs contend.

13 The plaintiffs' summons also seeks an order that a sealed Notice of Appearance filed by any proposed defendant be served on the plaintiffs' solicitor in accordance with r 8.05. For reasons which are entirely unclear, the only appearances filed and recorded in the Court's records are:**

(a) an appearance filed for all of the objectors listed below in paragraph 14, in the one Notice of Appearance dated 23 October 2012; and

(b) an appearance filed on 7 November 2012 on behalf of Frostmeadow Pty Ltd.

**14 The plaintiffs' solicitor complained that he had not received sealed copies of Notices of Appearance from objectors by 2 November 2012, as ordered by Zammit AsJ on 26 October 2012. In consequence he searched the file to discover an appearance by Frostmeadow Pty Ltd, which had not been served on the plaintiffs. What is worse, that solicitor was served with nine Notices of Appearance on or about 13 November 2012, but with the exception of the appearance by Frostmeadow, none appear on the Court File or on Court View!

15 The defendants sought and were granted leave to file an affidavit today of Mr Alan Harvey Shnider, affirmed on 12 February 2013. That affidavit exhibits 10 separate Notices of Appearances apparently bearing the seal of the Court and dated 7 November 2012. The Appearances are for the following 10 objectors:**

(a) Toni Samuel;

(b) Scott Colin Newett;

(c) Irene Solanche Zandburg;

(d) Anthony Dion Goldman;

(e) Sharonna Esther Brott;

(f) Roslyn Michele Rosengarten;

(g) Joseph Jacob Owzskinsky and Helen Owzskinsky;

(h) Jonathan Reair Hirsch;

(i) Frostmeadow Pty Ltd; and

(j) Leora Harrison.

**16 It does not appear as to how Notices of Appearances for each of the above objectors were sealed with the seal of the Court but do not appear in the Court file or in the Court View records. But it does appear that on 23 October 2012 an appearance was entered for all of the above objectors in the one Notice of Appearance, but that Zammit AsJ directed the objectors to file separate appearances, or at least that was the contention of Ms Acreman who appeared for them.

17 In the circumstances, enquiries will be made of the Supreme Court Registry to determine whether or not copies of the separate appearances identified in paragraph 15 above were in fact filed. On the assumption, however, that the solicitors for the defendants are authorised and instructed to represent each of the above objectors in the proceeding, and there being no objection by the plaintiffs, I will direct that copies of the appearances which are exhibit AHS1 to the affidavit of Alan Harvey Shnider, with the exception of the appearance by Toni Samuel, be placed on the Court file. This, in my opinion, sufficiently regularises what may have been an error either by the solicitor for the objectors or by the Registry of the Court.

18 The Plaintiffs apply for indemnity costs on the Summons seeking to strike out the appearance of Ms Samuels.

19 Even though I have come to the conclusion reasonably readily that Ms Samuels is not an owner of land benefited by the Covenant, this area of the law is complex, and often difficult, and requires considerable specialised knowledge. Counsel for the plaintiff pointed to the fact that on 26 October 2012 the plaintiffs put the defendants on notice of an application to strike out the appearance of Ms Samuels on this basis.

20 Notwithstanding this warning, it is by no means an easy matter to determine that a particular landholder is or is not entitled to the benefit of a restrictive covenant. In these circumstances, I am not persuaded that there has been a 'wilful disregard of known facts or clearly established law', to warrant the grant of indemnity costs, in accordance with the principles as set out by Harper J (now Harper JA) in Ugly Tribe v Sikola.[3]

21 For these reasons, I will not order indemnity costs against Ms Samuel, but I will order that the plaintiffs' costs of the summons dated 5 December 2012 be paid by Ms Toni Samuel.

22 I will otherwise make orders, in lieu of the Orders of Zammit AsJ made on 26 October 2012 in paragraphs 2, 3, 4 and 8, in the terms discussed. Namely, the defendant's affidavits to be filed and served by 27 March 2013, affidavits in reply from the plaintiffs to be filed and served by 17 April 2013, mediation to be held by 17 May 2013 and adjourn the Directions Hearing to 31 May 2013, and costs as outlined above.

23 I will make orders in accordance with these reasons.**

[1] Unless there is established a 'building scheme', or scheme of development: see Bradbrook & Neave, 3rd Ed, paragraph 19.43 - 19.44; and see further as to the requirements for a scheme of development the decision of Gillard J in Fitt v Luxury Developments Pty Ltd [2000] VSC 258, particularly at [138]-[148].

[2] (1848) 2 Ph 774; 41 ER 1143; See also Megarry & Wade, The Law of Real Property, 4th Ed, p 753.

[3] [2009] VSC 189 at subparagraph 7(vi).