Mehmet v Carter

Court of Appeal (NSW)|2018-03-27|Before: Bathurst CJ, Beazley P, McColl JA, Errol J, Darke J

Background facts

The hearing of the separate questions proceeded before the primary judge on the basis of a schedule of agreed facts, as follows: "3. The parties agree that located on the land there a. is a rock bearing a plaque stating HARRY AND CLARA BRAY TRIBAL ELDERS OF THE BUNJALUNG TRIBE BURIED NEAR THIS SITE CIRCA LATE 1890 b. a Bunya pine tree; 4. It is agreed that Clara and Harry Bray died in circa 1922 5. [The appellants] assert and [the respondents] deny that located on the land there are 'Aboriginal Objects' as defined under s 5(i) of the National Parks and Wildlife Act 1974, including a. Remains of H & C Bray &/or one or more of their children b. A ceremonial mound 'destroyed' c. Remains of a Gunyah d. Another burial site e. Lots of other burials/remains f. and in particular, remains of Harry Bray, remains of Clara Bray, remains of a descendant of Harry and/or Clara Bray, remains of other aboriginal persons."

Legislation

The National Parks and Wildlife (Amendment) Act 1969 (NSW) introduced Pt IVA, headed "Relics", into the National Parks and Wildlife Act 1967 (NSW), which provided, relevantly: "33D (1) Subject to this section, a relic that, immediately before the commencement of this Act- (a) was not the property of the Crown; and (b) was not in the possession of any person, and any relic that is abandoned after that commencement by a person other than the Crown, shall be deemed to be, and always to have been, the property of the Crown. (2) For the purposes of subsection one of this section, a person shall not be deemed to have had possession of a relic that was not originally real property only by reason of the fact that it was in or on land owned or occupied by him. (3) Nothing in this section shall be construed as restricting the lawful use of land or as authorising the disturbance or excavation of any land. (4) No compensation shall be payable in respect of the vesting of a relic by this section. 33E A person, other than the Director, who- (a) disturbs or excavates any land, or causes any land to be disturbed or excavated, for the purpose of discovering a relic; (b) takes possession of a relic that is in a national park, state part, historic site, nature reserve or aboriginal area; (c) removes a relic from a national park, state park, historic site, nature reserve or aboriginal area; or (d) erects or maintains, in a national park, state park, historic site, nature reserve or aboriginal area, a building or structure for the safe custody, storage or exhibition of any relic, except in accordance with the terms and conditions of an unrevoked permit issued to him under section 33F of this Act, being terms and conditions having force and effect at the time the act or thing to which the permit relates is done, shall be guilty of an offence against this Act. … 33K (1) A person who, without first obtaining the written consent of the Director, knowingly destroys, defaces or damages a relic, shall be guilty of an offence against this Act. (2) It shall be a defence to a prosecution for an offence under subsection one of this section if the offender proves- (a) that preservation of the relic in the condition in which it was before being destroyed, defaced or damaged would unreasonably have restricted the use, in a manner that, but for subsection one of this section, would have been lawful, of land in or on which the relic was situated; and (b) either - (i) that the Director was notified, before the destruction, defacing or damaging of the relic, that it was proposed to use the land in that manner; or (ii) that such a notification was impracticable in the circumstances."
The National Parks and Wildlife Act 1967 was repealed by the National Parks and Wildlife Act 1974, which commenced on 1 January 1975 and provided, relevantly, as follows: "5 Definitions (1) In this Act, except in so far as the context or subject-matter otherwise indicates or requires: … Aboriginal object means any deposit, object or material evidence (not being a handicraft made for sale) relating to the Aboriginal habitation of the area that comprises New South Wales, being habitation before or concurrent with (or both) the occupation of that area by persons of non-Aboriginal extraction, and includes Aboriginal remains. … Aboriginal remains means the body or the remains of the body of a deceased Aboriginal person, but does not include: (a) a body or the remains of a body buried in a cemetery in which non-Aboriginal persons are also buried, or (b) a body or the remains of a body dealt with or to be dealt with in accordance with a law of the State relating to medical treatment or the examination, for forensic or other purposes, of the bodies of deceased persons. … harm an object or place includes any act or omission that: (a) destroys, defaces or damages the object or place, or (b) in relation to an object - moves the object from the land on which it had been situated, or … (d) causes or permits the object or place to be harmed in a manner referred to in paragraph (a), (b) … … 83 Certain Aboriginal objects to be Crown property (1) Subject to this section: (a) an Aboriginal object that was, immediately before the commencement day, deemed to be the property of the Crown by virtue of section 33D of the Act of 1967, and (b) an Aboriginal object that is abandoned on or after that day by a person other than the Crown, shall be, and shall be deemed always to have been, the property of the Crown. (2) Nothing in this section shall be construed as restricting the lawful use of land or as authorising the disturbance or excavation of any land. (3) No compensation is payable in respect of the vesting of an Aboriginal object by this section or section 33D of the Act of 1967. 84 Aboriginal places The Minister may, by order published in the Gazette, declare any place specified or described in the order, being a place that, in the opinion of the Minister, is or was of special significance with respect to Aboriginal culture, to be an Aboriginal place for the purposes of this Act. 85 Director-General's responsibilities as to Aboriginal objects and Aboriginal places (1) The Director-General shall be the authority for the protection of Aboriginal objects and Aboriginal places in New South Wales. (2) In particular, the Director-General shall be responsible: (a) for the proper care, preservation and protection of any Aboriginal object or Aboriginal place on any land reserved under this Act, and (b) subject to Division 2, for the proper restoration of any such land that has been disturbed or excavated in accordance with an Aboriginal heritage impact permit. … 86 Harming or desecrating Aboriginal objects and Aboriginal places (1) A person must not harm or desecrate an object that the person knows is an Aboriginal object. Maximum penalty: (a) in the case of an individual - 2,500 penalty units or imprisonment for 1 year, or both, or (in circumstances of aggravation) 5,000 penalty units or imprisonment for 2 years, or both, or (b) in the case of a corporation - 10,000 penalty units. (2) A person must not harm an Aboriginal object. Maximum penalty: (a) in the case of an individual - 500 penalty units or (in circumstances of aggravation) 1,000 penalty units, or (b) in the case of a corporation - 2,000 penalty units. (3) For the purposes of this section, circumstances of aggravation are: (a) that the offence was committed in the course of carrying out a commercial activity, or (b) that the offence was the second or subsequent occasion on which the offender was convicted of an offence under this section. This subsection does not apply unless the circumstances of aggravation were identified in the court attendance notice or summons for the offence. (4) A person must not harm or desecrate an Aboriginal place. Maximum penalty: (a) in the case of an individual - 5,000 penalty units or imprisonment for 2 years, or both, or (b) in the case of a corporation - 10,000 penalty units. (5) The offences under subsections (2) and (4) are offences of strict liability and the defence of honest and reasonable mistake of fact applies. (6) Subsections (1) and (2) do not apply with respect to an Aboriginal object that is dealt with in accordance with section 85A. (7) A single prosecution for an offence under subsection (1) or (2) may relate to a single Aboriginal object or a group of Aboriginal objects. (8) If, in proceedings for an offence under subsection (1), the court is satisfied that, at the time the accused harmed the Aboriginal object concerned, the accused did not know that the object was an Aboriginal object, the court may find an offence proved under subsection (2). … 87 Defences (1) It is a defence to a prosecution for an offence under section 86 (1), (2) or (4) if the defendant shows that: (a) the harm or desecration concerned was authorised by an Aboriginal heritage impact permit, and (b) the conditions to which that Aboriginal heritage impact permit was subject were not contravened. (2) It is a defence to a prosecution for an offence under section 86 (2) if the defendant shows that the defendant exercised due diligence to determine whether the act or omission constituting the alleged offence would harm an Aboriginal object and reasonably determined that no Aboriginal object would be harmed. … 90 Aboriginal heritage impact permits (1) The Director-General may issue an Aboriginal heritage impact permit. (2) An Aboriginal heritage impact permit may be issued subject to conditions or unconditionally. However, a condition cannot be imposed on a permit if compliance with the condition would result in a breach of a requirement made by or under this Act. (3) An Aboriginal heritage impact permit may be issued in relation to a specified Aboriginal object, Aboriginal place, land, activity or person or specified types or classes of Aboriginal objects, Aboriginal places, land, activities or persons. … 90K Factors to be considered in making determinations regarding permits (1) In making a decision in relation to an Aboriginal heritage impact permit, the Director-General must consider the following matters: (a) the objects of this Act, (b) actual or likely harm to the Aboriginal objects or Aboriginal place that are the subject of the permit, (c) practical measures that may be taken to protect and conserve the Aboriginal objects or Aboriginal place that are the subject of the permit, (d) practical measures that may be taken to avoid or mitigate any actual or likely harm to the Aboriginal objects or Aboriginal place that are the subject of the permit, (e) the significance of the Aboriginal objects or Aboriginal place that are the subject of the permit, (f) the results of any consultation by the applicant with Aboriginal people regarding the Aboriginal objects or Aboriginal place that are the subject of the permit (including any submissions made by Aboriginal people as part of a consultation required by the regulations), (g) whether any such consultation substantially complied with any requirements for consultation set out in the regulations, (h) the social and economic consequences of making the decision, (i) in connection with a permit application: (i) any documents accompanying the application, and (ii) any public submission that has been made under the Environmental Planning and Assessment Act 1979 in connection with the activity to which the permit application relates and that has been received by the Director-General, (j) any other matter prescribed by the regulations. (2) The Director-General, in making a decision in relation to an Aboriginal heritage impact permit, must not consider any matter other than the matters referred to in subsection (1)." (emphasis added)

Question 1: Whether the existence of the alleged Aboriginal objects (as defined under the National Parks and Wildlife Act 1974) are capable of constituting a defect in title to the land on which they are located?

Primary judge's reasons

The issue before the primary judge in relation to question 1, as identified by his Honour at [74]-[75], was whether, if, as the appellants alleged, the Aboriginal objects, or some of them, were the property of the Crown, the affectation of the land by their presence in or on the land was a defect in title, because it vested in the Crown part of the subject matter which the respondents contracted to sell. Further, whether, if such Aboriginal objects were "deposits" in the land, they formed part of the land vested in the Crown notwithstanding the provisions of the Real Property Act 1900 (NSW).
On the appellants' argument before his Honour, an Aboriginal object that is "permanently affixed to land" is: (a) an affectation which prevents the vendor from giving good marketable title; and (b) an interest in the land comprised within the certificate of title. The appellants contended that either basis was capable of constituting a defect in the registered proprietor's title to the land.
The opposing argument before the primary judge was that even if there were Aboriginal objects in or on the land, those objects did not form part of the subject matter of the sale: see Borda v Burgess (2003) 11 BPR 21, 203; [2003] NSWSC 1171.
The primary judge noted, at [87], that the contract for sale described "the land" by reference to its street address and the title details. In his Honour's opinion, the contract was not to be construed in such a way that any Aboriginal objects not owned by the respondents were included as part of the subject matter of the sale.
His Honour referred to the principles of construction of a commercial contract, namely, that the terms of the contract are to be understood objectively, by what reasonable business persons would have understood them to mean. His Honour said that the court was entitled to approach the task of construction on the basis that the parties intended to produce a commercial result which makes commercial sense: see Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd (2017) 343 ALR 58; [2017] HCA 12 at [16]-[17]; Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640; [2014] HCA 7 at [35].
His Honour considered, at [88], that reasonable business persons in the position of the parties would not have understood the contract to have contained an obligation on the part of the respondents to sell any Aboriginal objects in and on the land that they did not own. In his Honour's opinion, the legislative background told against such a construction. As his Honour explained: "The definition of Aboriginal objects is broad, and the likelihood of their existence throughout the State is large, particularly in areas where intensive construction work has not been undertaken (see Country Energy v Williams (2005) 63 NSWLR 699; [2005] NSWCA 318 at [7], [56]-[57] and [67]). Moreover, Aboriginal objects are by their very nature most likely to be beneath the surface of the soil. Given the legislative regime, which makes it an offence to harm Aboriginal objects unless authorised by an Aboriginal heritage impact permit, it would be highly problematic, if not impossible, to determine the extent to which Aboriginal objects are present in or on any land. These circumstances, coupled with the highly restricted regime concerning the transfer of Aboriginal objects, means that [the respondents] would likely face great difficulty, if not impossibility, in proving a good title if Aboriginal objects not owned by [the respondents] were included in the sale. It seems to me that the construction favoured by [the appellants] would thus give rise to commercially unexpected and inconvenient results. The parties should not be taken to have agreed that [the respondents] would convey such objects, which they do not own, and have no realistic prospect of owning."
His Honour concluded, at [89], that the property the respondents promised to convey to the appellants did not include any Aboriginal objects in or on the land that the respondents did not own, including any Aboriginal objects that were the property of the Crown. His Honour rejected, at [90], the appellants' argument that because the Aboriginal objects were embedded within the soil or were otherwise affixed to the land, they formed part of the subject matter of the sale. In his Honour's view, any Aboriginal objects in or on the land not owned by the respondents retained an independent identity from the land which surrounded or supported them, even if they might be considered more in the nature of fixtures rather than chattels.
His Honour also considered that ownership of an Aboriginal object was divorced from the surrounding or supporting land, in that, even if there were Aboriginal objects in or on the land, the rights of property in them did not confer an interest in the surrounding or supporting land such that the respondents were required to cause the legal title to the land to pass to the appellants free of any such rights, pursuant to cl 16.3 of the contract.
His Honour acknowledged, at [92], that the presence of Aboriginal objects could have an effect on the use or enjoyment of land. His Honour referred, for example, to the possibility that the development of land could be restricted or made more difficult as a consequence of the presence of such objects in or on the land. However, his Honour did not consider that this affected the title to the land that the respondents promised to convey to the appellants. It followed that the respondents would not, by reason of the existence of any Aboriginal objects not owned by them, be precluded from satisfying their obligation to show a good title to the property: see Travinto Nominees Pty Ltd v Vlattas (1973) 129 CLR 1; [1973] HCA 14 at 27.
Accordingly, on the primary judge's view, the alleged Aboriginal objects were not capable of constituting a defect in title for the purposes of the contract for sale. His Honour therefore answered question 1, "No".

Parties' submissions

The appellants' argument on the appeal, as it was at trial, was that the presence of immoveable objects on land which are owned by somebody other than the vendor, who has some ability to exercise powers that limit the use of the land, or over which somebody other than the vendor has control, is a defect in title which gives rise to a common law right to rescind: Flight v Booth (1834) 131 ER 1160; Torr v Harpur (1940) 40 SR (NSW) 585; Micos v Diamond [1970] 3 NSWR 407; Liberty Grove (Concord) Pty Ltd v Yeo (2006) 12 BPR 23,709; [2006] NSWSC 1373 (Tr 9, 21).
Although it was part of the appellants' case that the ownership of the objects, should they exist, was in the Crown, they argued that it was not necessary, in order to establish a defect in title, that the ownership of the objects be known. Rather, they submitted that what was relevant was whether there were any objects on the land that the respondents did not own and which they had no ability "to get rid of".
The appellants submitted that it was this inability that detracted from the complete and free use of the land, which is implied in an estate in fee simple. It did not matter, on their argument, whether the impediment imposed by the object or objects was substantial or not, although that would be relevant to the relief that a court might give. They accepted, however, that the principles on which they relied were limited to a vendor's suit for specific performance.
The appellants submitted that the presence of the objects on the land would have a significant effect on any redevelopment. They pointed out that the process of obtaining an Aboriginal heritage impact permit was cumbersome and the outcome uncertain. Even if a permit was obtained, it was likely to be restrictively conditioned.
In support of the argument that the Aboriginal objects were, for all relevant purposes, immovable, the appellants relied upon: the importance of the objects to the local Indigenous community, the Arakwal people; the impact of their importance on the likelihood that a permit for removal would be granted; the fact that it is an offence of absolute liability to harm the objects, including by moving them without a permit; the fact that it is an aggravation of the offence if the objects are moved for commercial purposes; and the limited defences available in a prosecution for harming Aboriginal objects.
The respondents' principal submission was that the objects not having been the subject of the conveyance did not constitute a defect in title. They submitted that there was nothing in the National Parks and Wildlife Act 1974 that operated to make the existence of Aboriginal objects on land a defect in title. The respondents relied in particular on s 83(2), which provides that s 83, which broadly speaking, conveys title of Aboriginal objects in the Crown, does not restrict the lawful use of land. They submitted that although subs (b) of the definition of "harm" imposed a restriction on moving objects from the land on which they had been situated, the relocation of objects within the bounds of particular land was not restricted. They also relied upon the fact that the Director-General does not have a right of entry under the Act.
The respondents also argued that the appellants should be confined to the way they conducted the matter at trial, which was based upon the agreed facts. The respondents said that the case as conducted before the primary judge was based on the proper construction of the contract. They submitted that no attempt was made by the appellants to put before the primary judge evidence which would have enabled his Honour to determine whether or not the Aboriginal objects gave rise to a substantial interference that was not bargained for.
However, in the way the separate questions were framed, whether there were Aboriginal objects on the land was not under consideration. The respondents submitted, nonetheless, that the primary judge was correct in determining that on the proper construction of the contract, any Aboriginal objects on the land were not the subject of the sale. It followed on this argument that the case was not governed by the principles in Flight v Booth or Torr v Harpur. The respondents conceded, however, that in determining question 1 the way that he did, that is, on the basis of construing the contract, the primary judge did not directly answer question 1.

Consideration

It is necessary at the outset to understand the principles governing the right of a purchaser, at common law, to rescind a contract for the sale of land.
The common law principle, as laid down in Flight v Booth, at 1162-1163, is that where an error or misdescription of the property the subject of a sale: "… is in a material and substantial point, so far affecting the subject-matter of the contract that it may reasonably be supposed, that, but for such misdescription, the purchaser might never have entered into the contract at all, in such case the contract is avoided altogether … Under such a state of facts, the purchaser may be considered as not having purchased the thing which was really the subject of the sale …"
In that case, the contract contained an 'error and misdescription clause', which provided that any error or misstatement of the property did not vitiate the sale, but compensation was payable. It was held that the misdescription in that case was material such that the purchaser was not bound to resort to the compensation clause.
The principle was applied in Torr v Harpur to uphold a purchaser's rescission of contract in circumstances where a large stormwater drain ran underneath the surface of the land and passed under a substantial part of the foundation of a number of cottages on the land which were in the course of construction. The contract provided that no error or misdescription of the property annulled the sale, but compensation, if demanded, was payable (the error or misdescription clause). The question in issue was whether the existence of the drain fell within that clause.
In applying the principle in Flight v Booth, Williams J held that the existence of the drain meant that the purchaser would not be obtaining substantially what he had contracted for. Williams J stated, at 594, in a passage upon which the appellants placed particular reliance: "The law laid down in Flight v. Booth appears to be only one application of the general law of contracts that where an essential promise has been broken the innocent party is enabled to treat himself as discharged from the contract, whereas the breach of a non-essential promise sounds in damages only … The compensation clause is applicable in cases in which damages, but not in cases in which cancellation, would be the appropriate remedy for the breach."
Williams J considered that the principle of law was clear. His Honour observed, at 591, if the underground drain was situated "where its presence would not be a serious disadvantage", then the purchaser would have "obtain[ed] substantially what he contracted for". His Honour instanced a number of examples, such as if the drain had been located under part of the property where building was prohibited because of a restrictive covenant, or if the drain had been along a boundary which would not have prevented the erection of the relevant structure.
His Honour further observed, at 591, that if the drain had not been under some part of the land adapted for building purposes, he did not think that the purchaser would have been entitled to succeed. However, the strength of the purchaser's case was that the drain was "situated beneath part of the foundations of the cottages". In this regard, there was evidence that the walls of the cottages could crack and should that occur, it "would be a very expensive job" to underpin the walls to maintain the stability of the cottages. There was also evidence, which his Honour accepted, at 593, that the presence of the drain "would be an extremely grave defect if the purchaser desired to resell or to mortgage the property".
His Honour concluded that the misdescription, in a material and substantial point, seriously affected the subject matter of the contract. His Honour stated, at 594, that if he refused relief, he would be forcing upon the purchaser something which "by reason of a departure from the terms of the contract, is so materially altered in character as to be in substance a different thing from that contracted for".
In Micos v Diamond, the purchasers sued their solicitor for negligence in failing to inform them before completion of the existence of the sewer drain on the property and the rights of the relevant statutory body, the Metropolitan Water, Sewerage and Drainage Board (the Water Board).
In Micos v Diamond, it was held, at 410, that the existence of a sewer drain, in respect of which it was an offence to build over or otherwise interfere with or obstruct, and which was located close behind the house on the property, was "a defect of title in the full sense and not in the somewhat special sense of Torr v. Harpur". As the Court stated: "The statutory right of the Water Board arises from s.32 (1)(e) which allows the [Water Board] to enter upon any private land and to lay or place therein any sewerage main. Then when the sewerage main is laid it becomes an offence under s.62 to erect, construct or place any building or other structure in, upon, over or under that sewerage main so as to interfere with or to obstruct the sewer. Furthermore the Board may where there is a threatened breach of the section sue for and obtain an injunction to prevent any damage to, interference with or obstruction of the sewer. See subsection (3). When the Water Board has rights of this kind over part of the land there is clearly in our opinion a defect in an owner's title to the fee simple."
It is apparent from this passage that the distinction drawn between a "defect of title in the full sense", as opposed to the "special sense of Torr v. Harpur", was a reference to the statutory powers of the Water Board that could be exercised. This was not the case in Torr v Harpur, where the only question was the existence of the drain under the cottages under construction on the land.
In Liberty Grove v Yeo, Palmer J, applying the principle in Flight v Booth as summarised in Torr v Harpur, found that the existence of a drain underneath a property amounted to a substantial latent defect in title entitling the purchaser to rescind. In that case, the ownership of the drain had not been ascertained. In rejecting the vendor's argument that the drain may have existed by right of a revocable licence which was not a defect in title, his Honour found that the evidence disclosed that it carried a substantial volume of water and its continued existence on the land was necessary. His Honour concluded, however, that the purchaser had irrevocably elected to affirm the contract by demanding compensation for the defect such as to have lost the common law right to rescind.
In Dainford v Lam, Powell J recognised, at 265, that the principle in Flight v Booth was not affected by the existence of an error and misdescription clause. As his Honour observed, at 265-266: "Although the harshness of the old Common Law rule has been ameliorated, in part, by resort to such clauses and, in part, by the willingness of the Court of Chancery, in a vendor's suit for specific performance, to treat deficiencies which are not substantial as not being a breach of an essential term, I do not understand the old Common Law rule otherwise to have been affected. Thus, in Travinto Nominees Pty Ltd v. Vlattas (at 27-28) Menzies J said: '… The rights and obligations of the parties' (to a contract for the sale of land) 'still largely depend upon the common law as tempered by the rules of equity. It is necessary to apply these before applying these conditions (of the contract) ...' "
In Dainford v Lam, the purchasers bought a home unit 'off the plan'. When the strata plan was registered, the unit they had contracted to buy, amongst other problems, had different boundaries from those stated on the plans annexed to the contract. The effect of the changed boundaries was to exclude ledges which had been shown on the plan, representing about 9 per cent of the area depicted on the plan annexed to the contract as being within the lot. The vendor commenced and then discontinued proceedings for specific performance. The purchasers subsequently gave notice of rescission, which the vendor treated as a repudiation and proceeded to resell the property. The vendor argued, inter alia, that the omission of the ledges was an error or misdescription, but that even if it constituted a defect in title, the deficiency was not substantial and thus was a matter for compensation only, and did not give rise to a right to rescind.
Powell J rejected that there had been an error or misdescription. Rather, there was an accurate description of something in respect of which, when the time for completion arrived, the vendor was not in a position to give complete title. That being so, there was no provision in the contract which bore upon the matter. His Honour observed, at 265, and again at 266, that at common law, a deficiency or error in the smallest portion or interest in the subject matter of the sale, either as to quantity or otherwise, was equivalent to a total want of title and entitled the purchaser to annul the sale. His Honour, at 268, then explained the position in equity in a suit for specific performance as follows: "Although all these cases deal with the effect of a failure to complete by the time fixed by a contract, they are merely particular examples - cases involving an insubstantial and immaterial deficiency being other examples - of the way in which the Court of Chancery was prepared, in an appropriate case and when specific performance was sought, to treat a breach of contract as a breach of an inessential term. This being so, and [the vendor] no longer seeking, and having put it out of its power to seek, specific performance of the contract, allowing [the purchasers] to exercise their common law right to rescind because of the deficiency causes no such discordance between the rules of law and equity as would bring into operation the provisions of Conveyancing Act 1919, s 13."
The Conveyancing Act, s 13 referred to in this passage provides that contractual clauses that would not have been deemed to have been of the essence in a court of equity are to receive the same construction after the commencement of the Act. Powell J had earlier noted, at 267, that this rule did not affect the common law rule. In other words, the common law principle applied except in circumstances where there was a suit for specific performance.
Based on these authorities, the appellants submitted that, as there was no suit for specific performance and could not be as the property had been re-sold, given the significant restrictions on the use of land where there are Aboriginal objects, their existence has the capacity to constitute a defect in title.
However, the respondents contended that the primary judge was correct in finding that the Aboriginal objects were not part of what was conveyed by the contract of sale: see Borda v Burgess. In that case, the property the subject of the sale was subject to a consolidated mining lease for coal which was not disclosed in the contract. The purchaser purported to rescind the contract on the basis that the mining lease constituted a defect in title. The vendor later purported to terminate the contract and commenced proceedings seeking a declaration that the termination was valid. The purchaser cross-claimed, seeking a declaration that the rescission was valid. All coal on the land was vested in the Crown.
Young CJ in Eq held that as the vendor never contracted to sell the coal and the mining lease was not an interest in land, there was no defect in title, only a defect in the quality of the land.
This was essentially the approach of the primary judge in the determination of question 1 in the present case. However, as the authorities I have discussed indicate, whether or not objects on or within property are the subject of sale does not determine whether there is a defect in title.
In the present case, whether the alleged existence of Aboriginal objects on the land is capable of constituting a defect in title depends upon applying of the National Parks and Wildlife Act 1974 in the event that there are such objects on the land. The provisions of that Act are set out above. The operation of the Act as it is relevant to question 1 commences with the definition of "harm". "Harm" to an object is defined in s 5 to mean destroying, defacing or damaging an object or moving the object from the land on which it has been situated.
"Aboriginal objects and Aboriginal places" are dealt with in Pt 6 of the Act. By the combined operation of s 33D of the 1967 Act and s 83(1) of the 1974 Act, any Aboriginal objects are the property of the Crown. In this case therefore, if there are Aboriginal objects on the land the subject of the contract for sale, those objects are the property of the Crown.
Notwithstanding that ownership of any such objects is in the Crown, s 83 does not restrict "the lawful use of land", and nor does it authorise "the disturbance or excavation of any land": see s 83(2). The second part of s 83(2) is directed to the requirement to obtain an Aboriginal heritage impact permit in order to, for example, move an Aboriginal object from land upon which it is situated: see s 85. Pursuant to s 85, the Director-General is the authority for the protection of Aboriginal objects and Aboriginal places in New South Wales, and is responsible for the proper care, preservation and protection of any Aboriginal object or place on any land reserved under the Act. The Director-General is also responsible, subject to Pt 6, Div 2, for the proper restoration of any land that has been disturbed or excavated in accordance with an Aboriginal heritage impact permit.
Section 86 provides for two offences for harming an Aboriginal object, the distinction between the two being whether a person has knowledge that the object is an Aboriginal object: s 86(1), or whether the person does not have that knowledge: s 86(2). The latter offence is an offence of strict liability, but is subject to a defence of honest and reasonable mistake: s 86(5). Differential penalties apply to the two offences. Another important aspect of the offence provisions is found in s 86(3), which provides that it is a circumstance of aggravation if the offence was committed in the course of carrying out a commercial activity, with a consequential increased penalty. It is also an offence to harm or desecrate an Aboriginal place: s 86(4).
It is a defence to a prosecution for an offence under ss 86(1), (2) or (4) if the harm or desecration concerned was authorised by an Aboriginal heritage impact permit and the conditions to which the permit was subject were not contravened: s 87(1). Thus, the holding of an Aboriginal heritage impact permit is of particular importance should a person harm or desecrate an Aboriginal object, even if done accidentally or unintentionally.
The provisions for obtaining an Aboriginal heritage impact permit are found in Pt 6, Div 2, and are set out above at [55]. I consider that there is merit in the appellants' submission that the undoubted necessity to obtain a permit if they were to develop the land was likely to significantly impact the use they could make of the land. In this regard, they pointed to the onerous application process for a permit, the uncertainty as to whether a permit would be granted and the restrictive nature of any conditions that might be imposed considering, in particular, the significance of the alleged Aboriginal objects this case: see s 90K(e).
Having regard to the matters to which I have referred, namely, that if there are Aboriginal objects on the land, their preservation is the responsibility of the Director-General; that it is an offence of strict liability to harm an Aboriginal object to which significant penalties attach; that it is a more serious offence to harm or desecrate what is known to be an Aboriginal object; that an Aboriginal object cannot be moved from the land unless in accordance with an Aboriginal heritage impact permit; and that obtaining a permit is onerous and its grant is uncertain, I am of the opinion that should there be Aboriginal objects on the land, their presence is capable of constituting a defect in title.
In this regard, I consider the case to be analogous to Micos v Diamond. I would add that it is not an answer that the statutory prohibition is only on the removal of an object from the land and that there is no prohibition on moving an object within the boundaries of the land. If, during the course of removal within the land, an Aboriginal object is destroyed, defaced or damaged, which is not a fanciful proposition, the person who did so will have committed an offence to which penalties apply, as has been described. I am also of the opinion that it is not an answer that the National Parks and Wildlife Act 1974 does not authorise the Director-General to enter upon the land. The interference with the use of the land should there be Aboriginal objects on the land, having regard to the extensive and onerous statutory regime to which I have referred, is such as to be capable of constituting a defect in title.
This leaves the question as to what relief should be granted on the appeal. As my reasons indicate, if it were appropriate to answer the separate questions, then I am of the opinion that his Honour erred in answering question 1 in the negative. However, as I have indicated, and as the Chief Justice makes clear in his reasons, which I have had the opportunity of reading in draft, the separate question raised a purely hypothetical issue. That raises the question whether it is appropriate for this Court to determine the appeal and answer question 1 in the affirmative, or whether the separate questions should not be answered and the matter returned to the primary judge for a hearing on the real issues in the case.
My concern in not answering question 1 is that when regard is had to his Honour's reasons, the question whether, if there were Aboriginal remains on the land, there was a defect in title has been determined by the manner in which his Honour approached that question. However, given that the question as framed was hypothetical, and given that whatever answer was given to question 1, there remained substantive matters to be determined in the proceedings, I have come to the conclusion that it was not appropriate for his Honour to determine the separate questions and this Court ought not to do so.
It follows that I agree with the orders proposed by the Chief Justice.

Notice of contention

The respondents accepted during the hearing that their notice of contention was not relevant to any of the separate questions before the primary judge and this Court. Accordingly, it is not necessary to address the question whether the special conditions of the contract precluded the appellants from terminating the contract.

Conclusion

The appellants should be granted leave to appeal against the decision of the primary judge. The answer to question 1 should be set aside. In lieu thereof, the questions should be answered in the terms proposed by the Chief Justice.
McCOLL JA: I agree with Bathurst CJ's reasons and the orders his Honour proposes. I also agree with Beazley P's reasons.

Amendments 13 December 2018 - Minor typographical errors corrected DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 13 December 2018

National Parks and Wildlife (Amendment) Act 1969(NSW)

National Parks and Wildlife Act 1967(NSW)

Solicitors: Beswick Lynch Lawyers (Appellants) Heydons Lawyers & Attorneys (Respondents) File Number(s): 2017/316471 Decision under appeal Court or tribunal: Supreme Court Jurisdiction: Equity Citation: Mehmet v Carter [2017] NSWSC 1067 Date of Decision: 16 August 2017 Before: Darke J File Number(s): 2015/360420

[This headnote is not to be read as part of the judgment] The respondents, the vendors, and the appellants, the purchasers, entered into a contract for the sale of land. Before settlement, the appellants were advised of the possible existence of Aboriginal objects in or on the land the subject of the sale. This gave rise to a dispute between the parties as to whether there were Aboriginal objects in or on the land within the meaning of the National Parks and Wildlife Act 1974 (NSW) and, if so, whether their existence constituted a defect in title to the land. Orders were made for the separate determination of four questions: Question 1 - whether the existence of the alleged Aboriginal objects were capable of constituting a defect in title; Question 2 - whether the respondents bore the obligation of proving a title free of any Aboriginal objects before completion; Question 3 - whether the existence of any defect in title constituted by the alleged Aboriginal objects which the respondents were unwilling or unable to remove at completion was a sufficient ground for termination; and Question 4 - whether the appellants effectively terminated the contract on the basis that the respondents refused to withdraw their claim for interest on the purchase price. The primary judge answered Questions 1 and 4 in the negative and found that Questions 2 and 3 did not arise. The only issue as finally argued on appeal was whether the primary judge erred in concluding that the alleged Aboriginal objects were not capable of constituting a defect in title. The Court held, allowing the appeal and remitting the whole of the proceedings to the Supreme Court: Per Bathurst CJ (Beazley P and McColl JA agreeing) (i) It was not appropriate for the primary judge to have answered Question 1 because: it was vague and hypothetical; any utility in answering the question may depend upon the manner in which the case is ultimately conducted at trial; the answer to the question would not finally determine the proceedings; and the issue should not be decided by way of a separate question. For the same reasons, it is not appropriate for this Court to answer Question 1: [2]-[3], [7]-[8], [103]. Tepko Pty Ltd v Water Board (2001) 206 CLR 1; [2001] HCA 19 applied. Per Beazley P (Bathurst CJ and McColl JA agreeing) (ii) Whether or not an object in or on the land is the subject of a contract for sale does not determine whether there is a defect in title: [10], [93]. Flight v Booth (1834) 131 ER 1160; Torr v Harpur (1940) 40 SR (NSW) 585; Micos v Diamond [1970] 3 NSWR 407; Dainford Ltd v Lam (1985) 3 NSWLR 255; Borda v Burgess (2003) 11 BPR 21, 203; [2003] NSWSC 1171; Liberty Grove (Concord) Pty Ltd v Yeo (2006) 12 BPR 23,709; [2006] NSWSC 1373 considered. (iii) If it were appropriate for the Court to answer Question 1, the primary judge erred in answering the question in the negative. If there were Aboriginal objects in or on the land, their presence was capable of constituting a defect in title: [100].

Should the Court answer the separate questions?

There are a number of powerful reasons why Question 1 should not have been answered. First, the question is both vague and hypothetical. It is vague in its reference to the alleged Aboriginal objects. It may be assumed that the objects which were identified in the agreed facts are the alleged objects, as set out in the judgment of Beazley P at [33] below. In these circumstances, the question is presumably based on the assumption that all the alleged items are present on the land. However, the descriptions of some of the items themselves are cast in extremely wide terms: for example, "lots of other burials/remains". The answer to the question may have no relevance depending on which, if any, of the alleged objects are found ultimately to exist on the land. For the same reason, the question is hypothetical.
Further, any utility in answering the question may depend upon the manner in which the case is ultimately conducted at trial. In the letter purporting to terminate the contract, which is referred to in the judgment of Beazley P at [51] below, the solicitors for the appellants stated that, in terminating, they were relying on "all grounds, whether or not previously disclosed and whether known or unknown".
In these circumstances, it is entirely unclear whether the appellants were seeking to terminate because of a failure to show good title, or because of repudiatory conduct by the respondent in failing to deal with the appellants' objections and insisting on completion, in circumstances which demonstrated an intention either not to be bound by the contract or an intention to fulfil it only in a manner inconsistent with their obligations: Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd (1989) 166 CLR 623 at 634, 647, 657-658; [1989] HCA 23.
If the appellants are relying on a defect in title, then the question arises whether they were entitled to rescind irrespective of the magnitude of the defect, or because the case fell within the principle in Flight v Booth (1834) 1 Bing NC 370; 131 ER 1160 and the other cases to which Beazley P refers in her judgment. In that context, it must be remembered that, at common law, a purchaser was entitled to rescind for any defect in title, however trivial, although the harshness of this principle was ameliorated in equity, which granted the vendors specific performance where the defect was not substantial, subject to the payment of compensation: see the discussion by Menzies J in Travinto Nominees Pty Ltd v Vlattas (1973) 129 CLR 1 at 27-28; [1973] HCA 14. In the present case, however, no question of specific performance arises.
While it is true that cl 6 of the contract did not state expressly that no error or misdescription, whether as to property, title, or otherwise, could "annul the sale", as did cl 7 of the "General Form of Conditions of Sale of Land, 1988 edition" considered in Batey v Gifford (1997) 42 NSWLR 710, it may well be arguable that cl 6 has the same effect: see Christopher Rossiter, Principles of Land Contracts and Options in Australia (LexisNexis Butterworths, 2003) at 324 [8.78] ff. If that is correct, then the nature of any defect ultimately identified will be of critical importance.

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