Hillpalm v Heaven's Door

Court of Appeal (NSW)|2002-10-03|Before: Meagher JA, Handley JA, Hodgson JA, Sheahan J

Reported Decision : (2002) 55 NSWLR 446 (2003) NSW ConvR 56-039

CITATION : Hillpalm v Heaven's Door [2002] NSWCA 301 FILE NUMBER(S) : CA 40479 of 2001 HEARING DATE(S) : 04/09/02 JUDGMENT DATE : 3 October 2002

PARTIES : Hillpalm Pty Limited v Heaven's Door Pty Limited JUDGMENT OF : Meagher JA at 1; Handley JA at 16; Hodgson JA at 17

Hillpalm: D Officer QC & P McGuire COUNSEL : Heaven's Door: T F Robertson SC Tweed: M Einfeld QC & H Irish Hillpalm: Bolster & Co SOLICITORS : Heaven's Door: Woolf Associates Tweed: Stacks the Law Firm with Halliday & Stainlay CATCHWORDS : Land and Environment Court - easements - appeal dismissed with costs. LEGISLATION CITED : s123 Environmental Planning & Assessment Act 1979 Real Property Act 1900 Wilkie v Blacktown City Council [2002] NSWCA 284 Sahade v Mosman Council [2000] NSWCA 251 CASES CITED: Composite Buyers Ltd v Soong (1995) 38 NSWLR 286 Pratten v Warringah Shire Council (1969) 90 WN(Pt1) NSW 134, 17 LGRA 371 Quach v Marrickville Municipal Council (1990) 22 NSWLR 55 DECISION : Appeal dismissed with costs.

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40479 of 2001 LEC 40161 of 2000

MEAGHER JA HANDLEY JA HODGSON JA

Thursday, 3 October 2002 HILLPALM PTY LTD v HEAVEN'S DOOR PTY LTD

Facts The appellant, Hillpalm Pty Ltd, was ordered by the Land and Environment Court to create an easement of right of way over its land known as "Tanglewood" (Lot 2 in DP 601049), in favour of the respondent, Heaven's Door Pty Ltd, the registered proprietor of an adjoining block of land known as "Emerald Mountain" (Lot 1 in DP 601049). An application for subdivision was made to Council in 1977 and envisaged access to the new Lot 1 by way of "an easement over the proposed new road" over part of Lot 2. Council approved the application subject to the "provision of a constructed right of carriageway" (the December 1977 condition). A further condition was imposed by in May 1978 (the May 1978 condition) and final approval was granted in November 1978 even although the conditions contained in the December 1977 and May 1978 letters had not been complied with.

While the Certificates of Title to both Lots 1 and Lot 2 contained diagrams showing a "proposed right of way 10 metres wide", they did not disclose the existence of any Easement, actual or proposed. Furthermore, Hillpalm Pty Ltd, had no knowledge that the owners of Lot 1 had any easement or right of way over its land.

On appeal it was submitted by the appellant that its "clean" Certificate of Title granted it indefeasibility, thereby preventing the respondent from asserting any easement or right of way over Lot 2.

Held (i) By s 122 a "breach of this Act" as referred to in s 123 includes "a contravention of or failure to comply with" a "condition subject to which a consent is granted". There is no doubt that the owner of Lot 1 could have in 1978 forced the owner of Lot 2 to create the easement in question. (ii) The Council's consent to the subdivision operates to create a right in rem, so that it may be relied on by all later transferees of any Lot. Furthermore, the transferee from time to time of any Lot which has the apparent benefit of any condition may enforce that condition: Wilkie v Blacktown City Council [2002] NSWCA 284; Sahade v Mosman Council [2000] NSWCA 251. (iii) The Environmental Planning and Assessment Act 1979 must take precedence over the system of registration of titles regulated by the Real Property Act. This is not only because it is the later enactment, but also because it partakes more of a public law enactment compared to the Real Property Acts' private law complexion: and also because the almost aggressive wording of ss122 and 123 display an intention that they are to be of universal force. The trial judge's findings should therefore not be disturbed.

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40479 of 2001 LEC 40161 of 2000

MEAGHER JA HANDLEY JA HODGSON JA

Thursday, 3 October 2002 HILLPALM PTY LTD v HEAVEN'S DOOR PTY LTD Judgment 1 MEAGHER JA: This is an appeal by a disappointed appellant which was ordered by Sheahan J in the Land and Environment Court to create an easement of right of way over certain of its land in favour of the respondent. 2 The essential facts are simple. The appellant and the respondent are the current registered proprietors of two adjoining blocks of land. The respondent is the current registered proprietor of Lot 1 in DP 601049 known as "Emerald Mountain", the appellant is the current registered proprietor of Lot 529 in DP 1003396, now known as "Tanglewood", and this lot was created out of land which was once Lot 2 in DP 601049. 3 In 1977 the whole of the land containing "Emerald Mountain" and "Tanglewood" was owned by Winchcombe Carson Trustee Co (Canberra) Ltd in 1977, when that company applied to the Council to subdivide it in order to create two Lots 1 and 2 to which I have referred. That application dated 24 November 1977 envisaged access to the new Lot 1 was to be by way of "an easement over the proposed new road" over part of Lot 2. On 22 December 1977 the subdivision was approved, subject (inter alia) to this condition: "(a) provision of a constructed right of carriageway from Clothiers Creek Road. The track shall be at least 2.5 metres wide and constructed with 150mm consolidated thickness of gravel." 4 On 22 May 1978 the Council wrote to Winchcombe Carson Trustee Co (Canberra) Ltd and imposed "as a condition of subdivision that a Right of Carriageway over the existing track shall be created in favour of the proposed rural lot if the new roads are not dedicated within 2 years". On 6 Novemebr 1978 Council granted final approval of the subdivision even although the condition contained in the December 1977 and May 1978 letters had not been complied with. 5 The Certificate of Title to both Lots 1 and 2 were issued in May 1979. Both contained diagrams showing "proposed right of way 10 wide". 6 There have been further subdivisions of Lot 2 in 1981, 1983 and 1990. 7 From 1990 onwards the Certificate of Title for Lot 2 merely has a reference to "DP 801121 for a diagram of the land". It contains no reference to any proposed right of way or easement. As at 1990 (and since) a search of the Certificate of Title for Tanglewood would not disclose the existence of any Easement, actual or proposed. Neither would a search for the Certificate of Title to Emerald Mountain. 8 On 2 November 1978 a Mrs Hambrook became the principal figure in the appellant company. She had no knowledge that the owners of Lot 1 had any easement or right of way over the appellant's land. 9 In these circumstances Mr Officer QC, learned senior counsel for the appellant (owner of Lot 2) has submitted that his client's "clean" Certificate of Title grants it indefeasibility and prevents the respondent owner of Lot 1 from asserting any easement or right of way over Lot 2, whether derived from the 1977 subdivision or that subdivision via s123 of the Environmental Planning and Assessment Act 1979. 10 Learned senior counsel for the respondent Heavens Door, the owner of Lot 1, Mr Robertson SC, has submitted that the effect of the Environmental Planning and Assessment Act is to generate in his client a right to enforce the conditions of the 1977 subdivision, whatever the Certificates of Title say. His submissions prevailed before Sheahan J. 11 Section 123 (1) says: "Restraint etc of breaches of this Act (1) Any person may bring proceedings in the court for an order to remedy or restrain a breach of this Act, whether or not any right of that person has been or may be infringed by or as a consequence of that breach."

By s122 a "breach of this Act" as referred to in s123 includes "a contravention of or failure to comply with" a breach of "a condition subject to which a consent is granted". There is, therefore, no doubt that the owner of Lot 1 could have, in 1978, brought proceedings for an order compelling the owner of Lot 2 to create the easement in question and that such an order could then have been made. 12 The question, then, is has what has happened thereafter deprived the current owners of Lot 1 of that right. And "what has happened" is a series of dealings which have left the current Certificate of Title to "Tanglewood" nude of any reference to an easement. 13 Moreover, the Council's consent to the subdivision operates to create a right in rem, so that it may be relied on (inter alia) by all later transferees of any Lot. This has been decided by a long series of cases at both a State and Federal level. It has also been decided that the transferee from time to time of any Lot which has the apparent benefit of any condition may enforce that condition. Wilkie v Blacktown City Council [2002] NSWCA 284, Sahade v Mosman Council [2000] NSWCA 251. 14 In my view the Environmental Planning and Assessment Act 1979 must take precedence over the system of registration of titles regulated by the Real Property Act. This is not only because it is the later enactment, but also because it partakes more of a public law enactment compared to the Real Property Acts' private law complexion; and also because the almost aggressive wording of ss122 and 123 display an intention that they are to be of universal force. 15 For these reasons I would dismiss the appeal with costs. 16 HANDLEY JA: I agree with Meagher JA. 17 HODGSON JA: I agree with Meagher JA. 18 I would add that, as submitted by Mr. Robertson SC, the Environmental Planning & Assessment Act is concerned with land as a topographical entity, indifferently to its proprietorship; and also that there is a continuing contravention of a condition of a development consent for so long as the development continues and the condition is unfulfilled. 19 If the development in question is a use of land, then any person who makes that use of the land pursuant to the consent without complying with the condition will be in breach of the Act and can plainly be ordered to rectify that breach, irrespective of what appears on the title to the land. If the development in question is a subdivision, then a later owner of the subdivided land or of a subdivided part of it may not be guilty of any breach of the Act, but nevertheless, so long as the land remains subdivided in accordance with a development consent without a condition of that consent being fulfilled, there is objectively speaking a continuing contravention of the condition; and s.123 of the Act then gives power to the Land & Environment Court to order the rectification of that contravention by such person as is able to do so, again irrespective of what appears on the title of the land. 20 Mr. Officer QC submitted that this means that every purchaser would be required to search every development consent for unfulfilled conditions before land could safely be purchased; and that the interest represented by the ability to obtain a court order for the grant of an easement could and should be protected by caveat: cf. Composite Buyers Ltd. v. Soong (1995) 38 NSWLR 286. 21 However, any purchaser wishing to make any particular use of land plainly needs to be satisfied concerning conditions imposed on the relevant consent to that use, and it is customary for purchasers to enquire about compliance in relation to buildings. It would seem that the problem that has arisen in this case relates particularly to conditions of consents to subdivisions, because it may be that it is not customary to enquire about such conditions. 22 If there is a condition of a subdivision which, through the laxity of the Council and/or the subdivider, is not implemented, and particularly if there is no hint of this condition on the title documents, in my opinion the Court may decline as a matter of discretion to order compliance with it, or may order compliance only subject to conditions, including conditions requiring payment of money by the person seeking the order if that person's acts or omissions have contributed to the problem. In this case, however, the plan to which the certificate of title referred showed the area of the easement as "proposed right of way"; and having regard to that circumstance and the difficulties of providing alternative access to the respondent's land, discretionary considerations in favour of the appellant were not strong. 23 In any event, I do not think the matters advanced by Mr. Officer are sufficient to displace the conclusion reached by Meagher JA, which is also consistent with Pratten v. Warringah Shire Council (1969) 90 WN(Pt.1)NSW 134, 17 LGRA 371, and Quach v. Marrickville Municipal Council (1990) 22 NSWLR 55.

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