SECTION 88K CONVEYANCING ACT 1919
102Section 88K of the Conveyancing Act provides:
88K Power of Court to create easements
(1) The Court may make an order imposing an easement over land if the easement is reasonably necessary for the effective use or development of other land that will have the benefit of the easement.
(2) Such an order may be made only if the Court is satisfied that:
(a) use of the land having the benefit of the easement will not be inconsistent with the public interest, and
(b) the owner of the land to be burdened by the easement and each other person having an estate or interest in that land that is evidenced by an instrument registered in the General Register of Deeds or the Register kept under the Real Property Act 1900 can be adequately compensated for any loss or other disadvantage that will arise from imposition of the easement, and
(c) all reasonable attempts have been made by the applicant for the order to obtain the easement or an easement having the same effect but have been unsuccessful.
(3) The Court is to specify in the order the nature and terms of the easement and such of the particulars referred to in section 88 (1) (a)-(d) as are appropriate and is to identify its site by reference to a plan that is, or is capable of being, registered or recorded under Division 3 of Part 23. The terms may limit the times at which the easement applies.
(4) The Court is to provide in the order for payment by the applicant to specified persons of such compensation as the Court considers appropriate, unless the Court determines that compensation is not payable because of the special circumstances of the case.
(5) The costs of the proceedings are payable by the applicant, subject to any order of the Court to the contrary.
(6) Such an easement may be:
(a) released by the owner of the land having the benefit of it, or
(b) modified by a deed made between the owner of the land having the benefit of it and the persons for the time being having the burden of it or (in the case of land under the provisions of the Real Property Act 1900) by a dealing in the form approved under that Act giving effect to the modification.
(7) An easement imposed under this section, a release of such an easement or any modification of such an easement by a deed or dealing takes effect:
(a) if the land burdened is under the Real Property Act 1900, when the Registrar-General registers a dealing in the form approved under that Act setting out particulars of the easement, or of the release or modification, by making such recordings in the Register kept under that Act as the Registrar-General considers appropriate, or
(b) in any other case, when a minute of the order imposing the easement or the deed of release or modification is registered in the General Register of Deeds.
(8) An easement imposed under this section has effect (for the purposes of this Act and the Real Property Act 1900) as if it was contained in a deed.
(9) Nothing in this section prevents such an easement from being extinguished or modified under section 89 by the Court.
103Section 88K raises five questions:
(1)Is the proposed easement "reasonably necessary for the effective use or development" of the applicant's land: s 88K(1)?
(2)Is the Court satisfied that the use of the applicant's land "will not be inconsistent with the public interest": s 88K(2)(a)?
(3)Is the Court satisfied that the owner of the servient tenement can be adequately compensated for any loss or other disadvantage that will arise from imposition of the easement: s 88K(2)(b)?
(4)Is the Court satisfied that the applicant has made all reasonable attempts without success to obtain the easement or an easement having the same effect: s 88K(2)(c)?
(5)If the above four preconditions are established, should the Court exercise its discretion to impose an easement: s 88K(1)?
104The first four matters are conditions precedent to the fifth - the exercise of the Court's power to impose an easement - and therefore are jurisdictional facts. The first matter is objective. The second, third and fourth are subjective: that is, they are concerned with the primary judge's subjective state of mind being a state of "satisfaction". The question on judicial review of a subjective jurisdictional fact is not whether the reviewing court thinks that the state of satisfaction was unreasonable but whether it was so unreasonable that no reasonable body could have had that state of satisfaction; the latter requires something overwhelming: Notaras v Waverley Council [2007] NSWCA 333, 161 LGERA 230 at [124].
105A leading decision on the meaning and application of s 88K is that of Hodgson CJ in Eq in 117 York Street Pty Ltd v Proprietors of Strata Plan No 16123 (1998) 43 NSWLR 504. There the plaintiff sought an easement under s 88K for the tail of a crane (to be used in the construction of a multi-storey building) to pass through the air space of land being common property of a strata title building owned by the defendants. It was proposed to erect the crane on a public street but consent to do so from the relevant consent authority was not forthcoming without owner's consent from the defendants. Hodgson J granted the easement on terms including a term that the defendants, on the written request of the plaintiff or its solicitors, forthwith given their written consent to the making of a development application under the EPA Act for the erection in the public street referred to in the easement and its use within the airspace of the defendants' land in the manner contemplated by the easement: at 522. His Honour held that the grant of an easement is also the grant of such ancillary rights as are reasonably necessary for its exercise or enjoyment; that such ancillary rights include, where appropriate, a right to written consent for the lodging of a development application; that such a right would probably be implied in any event in a statutory grant of an easement; and that to avoid doubt it should be granted expressly: at 521. His Honour emphasised that this did no more than overcome a legal obstacle to the making of a development application, that the defendants were not required to consent to the development itself, and that such a term of an easement leaves the servient owner at liberty to object to the development and to exercise rights under the planning laws. As the easement took effect only upon registration (s 88K(7)), his Honour took the view that it was not appropriate to stay the order creating the easements until appropriate consents had been given (as he had initially contemplated): rather, he ordered that the plaintiff not commence to erect the crane in the public street referred to in the easement until development consent was achieved for such erection: at 522. His Honour held at 508-509:
What does "reasonably necessary" mean?
It is clear that "reasonably necessary" in s 88K(1) does not mean "absolutely necessary", and thus that the requirement may possibly be satisfied even when the plaintiff's land could be effectively used or developed without the easement: Tregoyd Gardens v Jervis (Hamilton J, 25 September 1997, unreported); Goodwin v Yee Holdings Pty Ltd (Windeyer J, 6 November 1997, unreported); Re Seaforth Land Sales Pty Ltd's Land [No 2] [1977] Qd R 317. In my opinion: (1) the proposed easement must be reasonably necessary either for all reasonable uses or developments of the land, or else for some one or more proposed uses or developments which are (at least) reasonable as compared with the possible alternative uses and developments; and (2) in order that an easement be reasonably necessary for a use or development, that use or development with the easement must be (at least) substantially preferable to the use or development without the easement.
The first of those requirements may seem contrary to a statement by Hamilton J in Tregoyd Gardens (at 14) that the Court "is not to judge upon the reasonableness of the particular development". However, that statement is qualified by the words "at least in this case". If there are some possible reasonable uses or developments of the land for which a proposed easement is not reasonably necessary, then it seems to me that the easement cannot be "reasonably necessary for the effective use or development" of the land, at least unless there is some proposed use or development, for which the proposed easement is reasonably necessary, which is itself a reasonable use or development. It may be that the particular proposed use or development would need also to be preferable to the alternatives; but whether or not that it so, it would in my opinion certainly need to be at least reasonable.
106His Honour held at 511-512
I turn to the question of illegality. If use of a proposed easement would be absolutely illegal, or (probably) if it were shown that there was no chance of obtaining a consent necessary to make it other than illegal, then this would in my opinion prevent the Court from finding that the easement was reasonably necessary. However, I do not think that the proposed use in this case is absolutely illegal, nor do I think that there is no chance of obtaining consent.
107In Khattar v Wiese [2005] NSWSC 1014, (2005) 12 BPR 23,235 Brereton J held at [32]:
...the purpose of s.88K would be defeated if, it being equally efficacious to obtain an easement over either of two lots, it could then be said that it was not necessary for it to be obtained over one or the other of them. In such a situation, the applicant may, within reason, select that lot over which it desires to acquire an easement. This may require the court to undertake some evaluation of the alternatives, in order to be satisfied that the applicant's proposal is reasonable as between them, but this need not involve a precise assessment of the respective advantages and disadvantages of each course, nor necessarily acceptance that the applicant's preferred course is objectively superior to the alternatives, so long as it is reasonable. In this, the court may be guided by the inference that an applicant will ordinarily pursue that course which offers the greatest practical and economic advantages for the development, and incur the least liability to pay compensation: a developer's economic interests will powerfully influence it to select the most reasonable course.
108In Rainbowforce Pty Ltd v Skyton Holdings Pty Ltd [2010] NSWLEC 2, (2010) 171 LGERA 286 a local council granted development consent to Rainbowforce for a high density residential development subject to a condition that it was not to operate until Rainbowforce satisfied the council that a right of carriageway had been created over adjoining land owned by the respondents. Pursuant to s 40 of the Land and Environment Court Act 1979, under which the Court may exercise the jurisdiction of the Supreme Court under s 88K of the Conveyancing Act, Preston CJ of LEC granted such an easement of carriageway. His Honour at [68] - [83] made the following points by reference to the authorities about the s 88K(1) power (omitting citations):
(1)It is a precondition of the exercise of the jurisdiction that there must be a finding that the easement sought is reasonably necessary for the effective use or development of the land which will have the benefit of it. A finding that that pre-condition is met is to be determined objectively and involves the making of a value judgment.
(2)The requirement in s 88K(1) is to be satisfied with respect to the particular easement that the Court is considering ordering to be imposed. Section 88K(3) requires the Court to specify in the order, the nature and terms of the easement. The proposed easement will accord with the easement which the applicant has made all reasonable attempts to obtain, or have the same effect as that easement, so as to satisfy s 88K(2)(c). The Court's power to impose an easement under s 88K(1) would extend to amending the proposed easement of the applicant, including so as to ensure the easement which the Court orders to be imposed satisfies the requirement in s 88K(1).
(3)The "other land" referred to in s 88K(1) is the land of the applicant for the order. The easement may be reasonably necessary for either the effective use or the effective development or both of the applicant's land. The Court's power to impose an easement is enlivened not only if the easement is reasonably necessary for a particular development or use proposed by the applicant but also if the easement is reasonably necessary for any development or use of the applicant's land, which is within the law.
(4)If use or development of land for some planning purpose, such as residential, commercial or industrial purposes, cannot be achieved without the creation and use of an easement for, say, access to the land or services to the land or for drainage of the land, the easement is reasonably necessary for such use or development to be effective.
(5)The easement is to be reasonably necessary for the effective use or development of the land that will have the benefit of the easement; it is not sufficient for the easement to be reasonably necessary for the enjoyment of the land by any of the persons who, for the time being, are the proprietors. Accordingly, evidence as to the particular problems that one of the existing proprietors may have, or the hardship suffered as a result of those problems, would not be relevant.
(6)The requirement that the easement be "reasonably necessary" does not mean that there must be an absolute necessity for the easement. An easement may be able to be imposed although another means of right of way may exist or possibly even when the land could be effectively used or developed without the easement. There needs to be something more than mere desirability or preferability over the alternative means available. In general terms, the greater the burden the stronger the case needed to justify a finding of reasonable necessity.
(7)The proposed easement must be reasonably necessary either for all reasonable uses or developments of the land, or else for some one or more proposed uses or developments which are (at least) reasonable as compared with the possible alternative uses and developments; and in order that an easement be reasonably necessary for a use or development, that use or development with the easement must be (at least) substantially preferable to the use or development without the easement.
(8)The requirement of reasonable necessity does not demand that there be no alternative land over which an easement could be equally efficaciously imposed. It cannot be the intention of the Act that if an easement would be equally efficacious over two pieces of land it cannot be granted over either because it cannot be said that it is necessary for it to be granted over that piece of land as opposed to the other.
(9)The requirement of reasonable necessity is to be decided in light of the present circumstances at the time of the hearing of the application for an order. Hence, it would not matter for the purposes of deciding whether the easement is reasonably necessary that the present circumstances were due to the applicant for the order taking a gamble. However, if such reasonable necessity for an easement as presently exists arose from previous unreasonable conduct from the applicant, that could be a discretionary factor counting against the granting of relief.
(10)The requirement of reasonable necessity can be satisfied notwithstanding that some future action may be required, in addition to obtaining the easement, for the effective use or development of land, such as obtaining some statutory consent. For example, if an easement in the form of a right of carriageway is created, it may be necessary to obtain development consent under the EPA Act to construct the road in the right of carriageway. The requirement in s 88K(1) does not require that all other obstacles to the proposed use or development of the land that will have the benefit of the easement must have been overcome before the Court has power to grant an easement. Only if use of the proposed easement would be absolutely illegal and there was no chance of obtaining a consent necessary to make it other than illegal, would the Court be precluded from finding that the easement was reasonably necessary.
109In ING Bank (Australia) Ltd v O'Shea [2010] NSWCA 71, (2010) 14 BPR 27,317, at [48]-[49] Giles JA (Campbell JA agreeing) held:
48"Reasonably necessary" is a composite phrase, in which the necessity is qualified so that it must be a reasonable necessity. Necessity is quite an absolute concept. The qualification is not of the use or development, so that it must be reasonable, although no doubt reasonableness of the use or development comes into reasonable necessity for that use or development. It is of the necessity.
49A qualification which did no more than reduce the necessity to a less absolute level is unlikely, and if that were intended some other word could have been used such as "convenient". Qualification whereby the necessity must be reasonable is apt to, and in my opinion does, permit regard to matters beyond the relatively absolute necessity for the effective use or development of the dominant tenement. It calls for an assessment of that necessity having regard to all relevant matters, according to the criterion of reasonableness. The impact of the easement on the servient tenement, and the fact that ordering an easement detracts from the property rights of the owner of the servient tenement, are matters readily to be taken into account in that assessment. It is difficult to see how reasonable necessity for an easement for the use or development of a dominant tenement, as distinct from necessity, can be arrived at without regard to the effect on the enjoyment of the servient tenement and on the property rights of the owner of the servient tenement.
110In Tanlane Pty Ltd v Moorebank Recyclers Pty Ltd (No 2) [2011] NSWSC 1286 at [34] Young JA said he broadly agreed with what Preston CJ LEC said in Rainbowforce. On appeal in Moorebank Recyclers Pty Ltd v Tanlane Pty Ltd [2012] NSWCA 445 at 155 (the Tanlane Case) the Court of Appeal qualified the fourth Rainbowforce point extracted above by saying that the desirability or economic effect of the proposed development on the applicant's land should also be considered. The Court of Appeal at [113] and [154] quoted with approval the passages quoted above from 117 York Street at 508-509 and ING.
111I have touched upon the Tanlane Case earlier. In the Tanlane Case, Tanlane sought an easement over Moorebank's panhandle under s 88K. The purpose of the easement was to allow Tanlane to build the road bridge to provide access via Council's Lot 309 from the Tanlane land to Brickmakers Drive (and thence to Newbridge Road), thus allowing it to pursue a planned residential development on its land. Moorebank opposed the imposition of an easement on the basis that the construction of the bridge would prevent it from gaining access to Brickmakers Drive from its own land across the surface of Lot 309 by the Marshall plan, in particular to pursue the development of a planned MRF on its land. The road bridge could not co-exist with the Marshall plan. Tanlane's answer was that the road bridge be built to accommodate ramps (Ramps A) which would run over Lot 310 to the panhandle, thus allowing Moorebank to access Brickmakers Drive. In 2011 Council determined to oppose Moorebank's proposed MRF and stated it would not consent to Moorebank having access over Council land for that purpose. As Council was landowner, its consent was necessary to effect both the ramps proposal and Marshall plan. Moorebank contended that (a) in those circumstances imposition of the easement sought would lead to the economic sterilisation of its land as the ramps proposal could not be effected; (b) the ramps may not have the load bearing capacity to accommodate the trucks it required for the MRF; (c) Tanlane did not require access to Newbridge Road, as alternative access from its land to a public road was available; and (d) in those circumstances the s 88K(1) precondition for the imposition of an easement that the easement be "reasonably necessary for the effective use or development of [the Tanlane] land", had not been made out. As mentioned previously, the primary judge considered the matter in three judgments delivered between 2008 and 2012 and found in favour of Tanlane, imposing an easement on (inter alia) the condition that Tanlane undertake to extinguish the easement if, despite the best endeavours of the parties, Moorebank was unable to obtain access to Newbridge Road by means of the ramps proposal. Moorebank appealed. The Court of Appeal set aside the order for the undertaking as being beyond power and, subject to a s 88K(4) order for compensation and assessment of compensation, said it would make an order imposing the easement in favour of Tanlane on the other terms ordered by the primary judge but, importantly, adding the following terms with the object of protecting Moorebank's interests under the ramps proposal, at [256]:
(ca) The bridge is to comply with AS5100/Bridge Design Code and have the load bearing capacity required by SM1600 referred to in cl 6.2 of Part 2 of the Code.'
(cb) The bridge design is to be sufficient to accommodate access ramps to and from the servient tenement themselves having the load bearing capacity required by SM1600.
112The Court of Appeal recognised the following principles in relation to s 88K(1):
(1)"reasonably necessary" for the effective use or development of the applicant's land does not mean absolute necessity but means something more than mere desirability or preferability over the alternative means available. The correct approach was stated in 117 York Street: at [154] (quoted above). This requirement was satisfied because (inter alia) there was no other viable alternative access to the proposed development on Tanlane's land other than through the imposition of an easement over Moorebank's panhandle: at [164], [204].
(2)If use or development for some planning purpose (such as residential, commercial or industrial purpose) cannot be achieved without the creation of the use of an easement for, say, access to the applicant's land, the easement is necessary for such use or development to be "effective" subject to consideration of the development's desirability or economic effect: at [155].
(3)In a case "where the easement is said to be necessary for the commercial development of the land, it is sufficient...to show that the proposed development is one which is appropriate to the area in which the land is situated and is at least an economically rational use of the land": at [155]. Use or development of the Tanlane land for a residential planning purpose could not be achieved without the creation and use of the easement for access appropriate to the area and was at least an economically rational use of the Tanlane's land.
(4)That is not to say an easement will always be granted in these circumstances because consideration is required of the effect of the grant of the easement on the servient tenement. The greater the burden on the servient tenement, the stronger the case needed to justify a finding of reasonably necessity. If the effect of construction of an easement was to effectively preclude a reasonably available development or use of the servient tenement, then it would require a strong case of reasonable necessity before the easement was imposed: at [157]. Ultimately, the question whether the easement is reasonably necessary for the effective use or development of the applicant's land will be determined by an evaluation of the above factors not in isolation but in conjunction with each other: at [159].
(5)For the easement to be "reasonably necessary" for that use and development, as pointed out in 117 York Street, the development with the easement must be substantially preferable to development without the easement. This is particularly the case if the grant of the easement would raise significant detriment to the servient tenement: at [163].
(6)The effect of the grant of the easement to Tanlane would put it out of Moorebank's power to itself obtain a s 88K easement from Council to implement the Marshall plan and then proceed with a development application with access to Brickmakers Drive as set out in the Marshall plan. However, it would be left with the opportunity to take similar steps in relation to the ramps proposal, which, if anything, would seem to hold better prospects of success than the Marshall plan. In these circumstances, the Tanlane easement was reasonably necessary for the use and development of the Tanlane land: at [203] - [204].
113The Court of Appeal's decision, as the latest appellate authority, is important not only for the principles which it recognises, but also for application of the principles to the facts of the case:
(a)Tanlane was granted an easement for access over Moorebank's panhandle to enable Tanlane to construct a road bridge for which it had obtained development consent to construct but not use.
(b)The Court of Appeal attached terms to the order imposing the Tanlane easement which required both the bridge and its access ramps to have the load bearing capacity required by SM1600 referred to in cl 6.2 of Part 2 of AS5100/Bridge Design Code. This was in order to accommodate the trucks required for Moorebank's proposed MRF on its land: at [177] - [185], [256].
(c)Use and development of the Tanlane land for residential purposes was held to be an "effective use and development" within s 88K(1) because,
(i)the Tanlane land was rezoned for that purpose in 2008;
(ii)DCP 2008 approved at the same time referred to a proposed subdivision to a maximum of 216 dwellings on Tanlane's land and the social and environmental benefits to be derived from the subdivision; and
(iii)when a comparison is made between a subdivision in accordance with the DCP 2008 and a non conforming use pursuant to existing use rights for excavation and recycling, it must follow that the proposed development is at least reasonable compared to the alternative: at [160] - [162].
114I do not think that there is no chance of obtaining approval for the proposed MRF on the Moorebank land. On the contrary, if it is necessary to go further, I consider that Moorebank has a substantial prospect of obtaining such approval if appropriate access is provided. The Moorebank land is zoned to permit an MRF, the Minister has paved the way toward a Part 3A approval by recently making an amended Part 3A declaration, and the consent authority is not the Council but the PAC, which is not bound by Council policies including as those contained in the 2008 LEP or the Development Control Plan.
115Planning witnesses for the respondents expressed an opinion that if development consent were granted for an MRF on the Moorebank land, it would only be for a short or medium period because of the reference to 2018 in cl 11 of Schedule 1 of the 2008 LEP. Apart from the fact that the Minister and PAC are not bound by the LEP in the Part 3A context, I disagree that cl 11 has anything to say about restricting the period of the use. The 2018 reference only means that development consent has to be obtained by then.