NTL Australia Pty Ltd v Minister for Land and Water Conservation

IN THE LAND AND 30061 of 1999 ENVIRONMENT COURT Pearlman J OF NEW SOUTH WALES 23 February 2001

NTL AUSTRALIA PTY LTD Applicant v MINISTER FOR LAND AND WATER CONSERVATION Respondent

These are class 3 proceedings in which the applicant has appealed against the redetermination by the respondent of the rent of a permissive occupancy.

By notice of motion, the respondent ("the Minister") has raised two preliminary questions which, by leave, were set down for hearing in advance of the substantive proceedings. The first question, which concerned the actual terms of the permissive occupancy, has been abandoned, the parties having reached agreement as to the particular document which constitutes those terms.

The second question, however, is a live issue. It is as follows: Whether the permissive occupancy granted by the Minister was revoked by reason of the declaration made by the Minister for Finance and Administration on 29 April 1999?

There is an issue as to whether the Court has jurisdiction to hear and dispose of the second question. The applicant claims that the Court has no jurisdiction, the question being a matter outside the limited jurisdiction conferred by statute upon this Court. The Minister argues on the contrary that the question falls within the jurisdiction of the Court.

Before turning to the jurisdiction issue, however, it is necessary to set out the background to the proceedings.

In 1961, the Minister granted a permissive occupancy under the Crown Lands Consolidation Act 1913 to the Director, Posts & Telegraphs, on behalf of the Commonwealth of Australia. The permissive occupancy was variously numbered as Commonwealth Permissive Occupancy (CPO) 213, or PO 1961/66 Newcastle, or simply 61/66. There is now no dispute between the parties that the terms of the permissive occupancy are those which are set out in a document ("document 'E'") entitled "Permissive Occupancy No 61/66 - Land District Newcastle", a copy of which is annexure 'E' to the affidavit of Mr R P Cole sworn 17 May 2000.

The land the subject of the permissive occupancy is described as lot 21 in deposited plan 223395 and is situated at Mount Sugarloaf near Newcastle. Constructed upon the land is a television transmitting station and related structures.

The redetermination of the rent of the permissive occupancy and the appeal to this Court arise under the Crown Lands (Continued Tenures) Act 1989 ("the Continued Tenures Act"). Clause 2(1) of pt 6 of sch 2 provides that the Minister may redetermine the rent of a permissive occupancy. The means by which that is done is set out in cl 11 of sch 5. The Minister gives notice of a redetermination including notice that the lessee may object (cl 11(1). The Minister considers any objection, and informs the objector whether the redetermined rent is to stand or be varied (c 11(2)(a)), and the objector may appeal to this Court if the redetermined annual rent exceeds $10,000. Clause 12 of sch 5 (to which I refer in more detail below) specifies the principles to be adopted by the Court in redetermining the rent on appeal.

A brief chronology of the relevant events is useful, and is as follows: 29 June 1998: The Minister gives notice of redetermination of the rent of the permissive occupancy;

21 September 1998: The Commonwealth lodges an objection to the redetermination;

2 March 1999: The Minister redetermines the rent of the permissive occupancy in the sum of $74,000 effective from 1 July 1999 (it being a term of the permissive occupancy (cl 1 document 'E') that the rent is payable annually in advance);

12 April 1999: The Commonwealth lodges the class 3 appeal;

29 April 1999: The declaration of the Minister for Finance and Administration under the National Transmission Network Sale Act 1998 (Cth) ("the Network Sale Act") is published in the Commonwealth Gazette ("the Gazette").

The Network Sale Act came into force on 21 December 1998. The whole Act relates to the sale of the national transmission network. Part 2, which contains ss 7 - 12, provides the mechanism for the sale. Section 7 deals with fixtures on non-Commonwealth land, and relevantly provides as follows: 7(1) The Minister for Finance and Administration may, by notice in the Gazette, declare that this section applies to network facilities specified in the notice. (2) At the end of the day on which the notice is published, any specified network facility that is a fixture on non-Commonwealth land: (a) is severed from the land and remains severed; and (b) vests in the Commonwealth; by force of this section. (3) In this section: network facility means any asset used, or formerly used, by the Commonwealth in connection with the transmission of a broadcasting service. non-Commonwealth land means land not owned by the Commonwealth.

Section 9 is headed "Transfer of assets and liabilities", and provides as follows: 9(1) The Minister for Finance and Administration may, by notice in the Gazette, declare all or any of the following, in relation to a company specified in the notice: (a) a specified Commonwealth asset vests in the company at a time specified in the notice (the transfer time) without any conveyance, transfer or assignment; (b) at the transfer time, the company becomes the Commonwealth's successor in law in relation to the transferred asset; (c) a specified instrument relating to the transferred asset continues to have effect after the transfer time as if a reference in the instrument to the Commonwealth … were a reference to the company. (2) The Minister for Finance and Administration may, by notice in the Gazette, declare all or any of the following, in relation to a company specified in the notice: (a) a Commonwealth liability specified in the notice ceases to be a Commonwealth liability at a time specified in the notice (the transfer time) and becomes a liability of the company; (b) at the transfer time, the company becomes the Commonwealth's successor in law in relation to the transferred liability; (c) a specified instrument relating to the transferred liability continues to have effect after the transfer time as if a reference in the instrument to the Commonwealth … were a reference to the company. (3) Declarations in relation to both assets and liabilities may be included in the same notice. The same notice may include declarations in relation to more than one asset or liability. (4) A declaration under this section has effect according to its terms. Note: The assets and liabilities that can be transferred under this section include assets and liabilities that consist of rights and obligations under contracts. 12. Various expressions used in the Network Sale Act are defined in s 3 as follows: asset means: (a) any legal or equitable estate or interest in real or personal property, including a contingent or prospective one; and (b) any right, privilege or immunity, including a contingent or prospective one.

Commonwealth asset means an asset of the Commonwealth.

specified , in relation to an asset, liability or instrument, means specified or identified (whether by reference to a class or by any other means).

13. Section 4(1) provides that the Act binds the Crown in the right of the Commonwealth and in the right of each of the States.

14. Section 12 relates to pt 2 and relevantly provides as follows: The operation of this Part is not to be regarded as: (a) … (b) … (c) placing a person in breach of any contractual provision prohibiting, restricting or regulating: (i) the assignment or transfer of any asset or liability; or (ii) …
15. The Minister for Finance and Administration, by notice published in the Gazette on 29 April 1999, made a declaration ("the Minister's declaration") pursuant to s 9 of the Network Sale Act. It relevantly provides as follows: Clause 1.1. includes the following definitions: Company means National Transmission Company Limited …

Specified Asset means an asset specified in Part 1 of Schedule A …

Clause 2 provides as follows: I, John Joseph Fahey, Minister for Finance and Administration, hereby declare, pursuant to the National Transmission Network Sale Act, that at the Transfer Time:

2.1 Section 9(1)(Assets) (a) Each Specified Asset vests in the Company without any conveyance, transfer or assignment; (b) The Company becomes the Commonwealth's successor in law in relation to each Specified Asset; and (c) Each Specified Instrument relating to a Specified Asset continues to have effect after the Specified Asset vests in the Company as if a reference in the instrument to the National Transmission Agency or to the Commonwealth were a reference to the Company. 16. Schedule A to the declaration is headed "Specified Assets" and it contains a number of parts. Relevantly, part 1 describes various specified assets, including, under the heading "Properties", any legal or equitable estate or interest or right or entitlement which the Commonwealth has in, or in relation to, a vast number of sites. One of those sites is listed as site number 2079, having site name "Mt Sugarloaf" and is described as "F/I: 22/223395" (it is expressly provided that the title description is "not necessarily an exhaustive description" of a site).

A further declaration was made by the Minister for Finance and Administration, by notice in the Gazette on the same day, 29 April 1999. By it, the Minister declared that s 7 of the Network Sale Act applied to network facilities (as defined in that section) located on land described in a schedule. Included amongst the numerous parcels of land described in the schedule is the Mount Sugarloaf land.

Additional relevant facts are set out in the affidavit of Mr P R Freer sworn on 14 August 2000, and the affidavit of the applicant's solicitor, Ms P L Hollott, sworn on 11 August 2000. According to this evidence, the Commonwealth Department of Communications, Information Technology and the Arts was responsible for running the national transmission network. On 12 April 1999, the Commonwealth filed the class 3 application which commenced these proceedings. Soon after the National Transmission Company Pty Limited acquired the national transmission network from the Commonwealth, pursuant to the Network Sale Act and the declarations I have previously described. On 25 May 1999, the Court granted leave for the name of that company to be substituted for that of the Commonwealth as applicant in the proceedings. On 16 November 1999, National Transmission Company Pty Ltd changed its name to NTL Australia Pty Ltd.

Clause (11)(3)(b) of sch 5 of the Continued Tenures Act provides that an appeal against a redetermination of rent lies to this Court if the annual rent so redetermined exceeds $10,000. That clause applies to the redetermination of the rent of a permissive occupancy (cl 2(3) of pt 6, sch 2).

Section 19 of the Land and Environment Court Act 1979 ("the Court Act") provides that the Court may hear and dispose of those appeals, claims and proceedings which it expressly specifies. One of the class of appeals so specified (in s 19(a)) are appeals arising under the Crown Lands Act 1989. However, although permissive occupancies have their statutory genesis in the Crown Lands Consolidation Act (as I shall later describe in some detail), the right of appeal against a redetermination of rent arises under the Continued Tenures Act. The Continued Tenures Act is not specifically mentioned in s 19 nor in any other section which is contained in pt 3 of the Court Act. Accordingly, any appeal against the redetermination of rent under the Continued Tenures Act falls within s 19(h), which provides that the Court may hear and dispose of: (h) any other appeals, references or other matters which an Act provides may be heard and disposed of by the Court, being appeals, references or other matters that are not referred to in any other section of this Part.

It is beyond doubt, therefore, that the Court has jurisdiction to hear and dispose of the appeal in this case. The question, however, is whether the Court's jurisdiction extends to determining whether or not the permissive occupancy has been revoked by the Minister's declaration.

In National Parks and Wildlife Service and Anor v Stables Perisher Pty Ltd (1990) 20 NSWLR 573, the Court of Appeal dealt with the question as to whether this Court had jurisdiction to deal with a claim in tort for general damages arising out of reliance by the plaintiff upon development consents which were allegedly void. Gleeson CJ, with whom the other members of the Court of Appeal agreed, held that this Court has only that jurisdiction which is to be found in the language of the Court Act and any other Act which confers jurisdiction upon it (p 580). In particular, this Court has no pendent or accrued jurisdiction. Accordingly, it had no jurisdiction to deal with a claim in tort for general damages. However, as Gleeson CJ pointed out at p 582: The Land and Environment Court, of course, in resolving a claim that is properly brought within its jurisdiction, has the power and the duty to decide all questions of fact or law that need to be decided in order to deal with that claim.

That passage was quoted with approval by Meagher JA in Minister for Minerals and Energy v Vaughan-Taylor and Anor (1991) 73 LGRA 115 at 123. That case dealt with a question which had arisen in the course of proceedings in this Court in which orders had been sought to stop mining upon certain land. An issue arose as to the validity of a mining lease granted by the Minister for Minerals and Energy, and the applicant in the proceedings applied to join the Minister as a respondent. The Minister appealed from a decision of this Court granting such application. It was held (by Priestley and Meagher JJA, Mahoney JA dissenting) that the Minister had been properly joined as a respondent. At p 123 Meagher JA dealt with a number of factors, including the fact that no relief of any kind was sought against the Minister. His Honour said: It could not be. The Land and Environment Court would have no jurisdiction to grant relief, even by way of declaration, against the Minister. However, the question of the invalidity of the lease was a step in the cause of action which the Land and Environment Court did have jurisdiction to determine. The Minister was joined not because any relief was sought against him but because an acceptance of the first respondent's case would involve pronouncing on his rights, a matter in which he was interested.

His Honour went on to consider the grounds for the Minister's objection to joinder, and his Honour said: The second submission was that the Land and Environment Court had no power to investigate the validity of the mining lease … It had, as was conceded, no jurisdiction to determine a direct challenge to the mining lease as such, but it did have jurisdiction to determine that question in an indirect or collateral fashion. The Land and Environment Court has jurisdiction to determine any question which arises incidentally to a matter in which it has jurisdiction.

In 1993, s 16(1A) was inserted in the Court Act. It provides as follows: 16(1A) The Court also has jurisdiction to hear and dispose of any matter not falling within its jurisdiction under any other provision of this Act or under any other Act, being a matter that is ancillary to a matter that falls within its jurisdiction under any other provision of this Act or under any other Act.

In Nix and Dunn v Pittwater Council (1994) 84 LGERA 199 an issue arose in the Court of Appeal as to whether s 16(1A) conferred jurisdiction upon this Court to hear and dispose of a cross-claim for damages for nuisance. In holding that the cross-claim could not have been reasonably regarded as "ancillary" to the matters the subject of the proceedings in this Court, Gleeson CJ (with whom the other members of the court agreed) considered the ambit of s 16(1A). His Honour said (at pp 204 - 205): The purpose of the legislature in enacting s 16(1A) was to reduce the number of cases which might give rise to a multiplicity of proceedings, by amplifying, to some extent, the jurisdiction of the Land and Environment Court. However, … the question of the extent of the intended amplification, give rise to an issue of the kind that was agitated in the present appeal.

The New South Wales legislature used, in s 16(1A), the word "ancillary" rather than "associated". … The relationship between two matters referred to in s 16(1A) is clearly intended to be a narrower one than that of association. The relevant dictionary meanings given to "ancillary" are incidental, accessory, or auxiliary: Macquarie Dictionary. The word derives from the Latin "ancilla", a hand-maid: see the discussion in Koala Motels Pty Ltd v Chief Licensing Inspector (1977) 18 ALR 12. 27. Since its enactment, s 16(1A) has arisen in a number of cases in this Court, some of which may be briefly noted as follows: Nelson v Ballina Shire Council (1993) 80 LGERA 271 - held that a council's contractual obligation to carry out certain roadworks was enforceable under s 16(1A) as a matter ancillary to the enforcement of a duty imposed on the council by s 94(3) of the Environmental Planning and Assessment Act 1979;

Figgis & Jefferson Pty Ltd v Mosman Municipal Council (1993) 81 LGERA 423 - held that, in a merit building appeal against a council's refusal of an application for approval of off-street parking, s 16(1A) did not enable the Court to exercise a primary administrative discretion to grant a permit under the Roads Act 1993 for a footpath crossing;

Mitchell v Waugh and Anor (1993) 82 LGERA 44 - held, in a claim for relief under the Encroachment of Buildings Act 1922, that s 16(1A) conferred jurisdiction upon the Court to make orders under the Dividing Fences Act 1991, but not to deal with claims based upon trespass and nuisance;

Butland v Cole (1995) 87 LGERA 122 - held that a claim for damages based upon trespass (as distinct from being based on an encroachment) was not ancillary to a claim for relief under the Encroachment of Buildings Act 1922, and s 16(1A) did not confer jurisdiction on the Court in respect of such a claim;

N Stephenson Pty Ltd v Roads and Traffic Authority of New South Wales (1994) 83 LGERA 248 - held that s 16(1A) did not confer jurisdiction upon the Court to hear and dispose of a claim for damages under s 96 of the Public Works Act 1912 as ancillary to a claim for compensation under the Land Acquisition (Just Terms Compensation) Act 1991;

Duncan v Moore and Ors (1999) 103 LGERA 312 - held that s 16(1A) did not confer jurisdiction upon the Court to hear and dispose of claims for breaches of the Parliamentary Electorates and Elections Act 1912 and the Electricity Supply Act 1995 as ancillary to a claim for a breach of the Environmental Planning and Assessment Act 1979 by reason of a failure to obtain development consent. 28. From the foregoing authorities, I derive the following propositions:

(a) This Court has jurisdiction to decide all questions of law and fact which it needs to decide in order to deal with a claim which is properly within its jurisdiction (National Parks v Stables Perisher); (b) That jurisdiction extends to all matters that are a step in the cause of action which this Court does have jurisdiction to determine, in the sense that those matters are incidental to the matter in which the Court has jurisdiction (Minister for Minerals and Energy v Vaughan-Taylor); (c) Although s 16(1A) amplifies to some extent the jurisdiction of this Court (Nix and Dunn v Pittwater Council), it operates only in relation to a matter which is ancillary, that is, incidental, accessory or auxiliary (Nix and Dunn v Pittwater Council). I respectfully adopt, in this connection, the statement of Talbot J in Duncan v Moore at p 319 that "… the matters brought within the Court's jurisdiction by s 16(1A) are only those matters which must be resolved as part of an accessory or ancillary subservient function in the course of determining the matter within jurisdiction"; (d) Section 16(1A) does not operate to confer jurisdiction on this Court in relation to a matter which is separate to and independent of the matter properly within jurisdiction, such as a claim for damages for tort or trespass (eg Mitchell v Waugh).

Applying those propositions to the facts of this case, I conclude that the question of revocation of the permissive occupancy is a matter which is ancillary to the issue of the redetermination of the rent of that permissive occupancy. This is demonstrated by cl 12 of sch 5 of the Continued Tenures Act. Clause 12 relevantly provides as follows (bearing in mind that the reference is a "lease" is also a reference to a permissive occupancy): 12(1) In redetermining the rent of a lease, the Minister, the local land board and the Land and Environment Court shall apply the following principles: (a) except in the case of leases of land within a special land district and prickly-pear leases, the rent shall be the market rent for the land comprised in the lease having regard to any restrictions, conditions or terms to which it is subject, (b) … (c) regard may be had to any additional value which has accrued, or may reasonably be expected to accrue, to other land held by the holder by reason of holding the lease, (d) regard may be had to the duration of the time for which the rent determined will be payable.

These provisions demonstrate that the terms and conditions of the permissive occupancy must be taken into account in the redetermination of the rent (sub-cls (a) and (d)), as must the holding of the permissive occupancy itself (sub-cl (c)). In other words, if there is no permissive occupancy, there are no terms and conditions to consider, there is no holding of the permissive occupancy to consider in connection with additional value, and there is no rent to redetermine. I am also mindful of the fact that the redetermination of rent was to take effect from 1 July 1999, and that is a factor to take into account under sub-cl (d). Furthermore, if the permissive occupancy had been revoked by the Minister's declaration on 29 April 1999, then any redetermination of the rent would have no utility. There would, in particular, be no period of rent referrable to the permissive occupancy. All these matters lead, in my opinion, to the inescapable conclusion that the question of the revocation of the permissive occupancy is ancillary to the question of the redetermination of the rent, and accordingly the former question is a matter within the jurisdiction of the Court.

Before dealing directly with that question, however, it is necessary to outline the statutory basis for the permissive occupancy, and its terms.

The original statutory basis for permissive occupancies is to be found in s 136K of pt VA of the Crown Lands Consolidation Act 1913, which was inserted in that Act by the Crown Lands (Permissive Occupancies) Amendment Act, 1958. Permissive occupancies had been granted prior to 1958, but there had been no statutory basis for them until the enactment of s 136K (Barrow and Anor v Brooksby (1958) 37 LVR 14).

Relevantly, s 136K provided as follows: 136K(1) The Minister may grant permission to occupy Crown Lands, whether above or below or beyond high water mark, or whether reserved from lease or licence or not, for such purposes, and, subject to this section, upon such terms and conditions as to him may seem fit. (3) A permission to occupy Crown lands or a permissive occupancy of Crown lands granted or purporting to have been granted before the commencement of the Crown Lands (Permissive Occupancies) Amendment Act 1958, and whether or not a tenancy was created or purported to have been created thereby, shall be deemed to have been validly granted and to have and always to have had force and effect subject to the terms and conditions thereof.

(5) A permission to occupy Crown lands or a permissive occupancy of Crown lands referred to in subsection (3) or a permission to occupy Crown lands granted under subsection (1) shall be terminable at will by the Minister.

In 1989, the Crown Lands Consolidation Act 1913 was repealed and was replaced by the Crown Lands Act 1989, s 6 of which is in the following terms: 6 Crown land to be dealt with subject to this Act etc Crown land shall not be occupied, used, sold, leased, licensed, dedicated or reserved or otherwise dealt with unless the occupation, use, sale, lease, licence, reservation or dedication or other dealing is authorised by this Act or the Crown Lands (Continued Tenures) Act 1989.

Parts 4 and 5 of the Crown Lands Act 1989 provide for a number of dealings in relation to Crown land, such as sale, lease, licence, grant of easement, reservation or dedication, but no provision is made for the grant of permissive occupancies. Indeed, permissive occupancies are referred to only in the savings and transitional provisions in cl 33 of sch 8 of the Act, which deals with pending applications for permissive occupancies. Accordingly, as the law now stands, there is no statutory basis under which the Minister could grant a permissive occupancy.

Nevertheless, permissive occupancies granted before the repeal of the Crown Lands Consolidation Act 1913 continue in force by operation of the Continued Tenures Act. Under the Continued Tenures Act, a "permissive occupancy" is defined as meaning a permissive occupancy or permission to occupy Crown lands granted under s 136K. Section 5 of the Continued Tenures Act provides that a tenure in force under a repealed Act (a "tenure" being defined to include a permissive occupancy) remains in force subject to the provisions of the Continued Tenures Act and the Crown Lands Act 1989. Section 11 provides that pt 6 of sch 2 applies to permissive occupancies, and that part makes provision for a number of aspects of permissive occupancies, including the redetermination of rent and the conditions to which permissive occupancies remain subject. In particular, pt 6 of sch 2 contains the following relevant provisions: 4(1) Subject to this Act and the Principal Act, a permissive occupancy remains subject to the conditions to which it was subject immediately before the commencement of this clause.

5 A permissive occupancy is terminable at will by the Minister.

There is no dispute that the permissive occupancy the subject of these proceedings was granted by the Minister in August 1961, and there is no dispute that it was granted pursuant to s 136K. There is also no dispute, as I have earlier indicated, that its terms are those set out in document 'E'. Those terms comprise 12 "standard" conditions and four "special" conditions. Two of the standard conditions are relevant to the question for determination. They are as follows: 3. The Permissive Occupancy is terminable at will by the Minister.

6. The tenant shall not sublet or part with possession of the premises, or any part thereof, or sell or transfer the Permissive Occupancy herein referred to, without the consent of the Minister for Lands having first been obtained. On termination of the Permissive Occupancy the tenant shall deliver up quiet and peaceable possession of the premises.

Mr Coles QC, appearing for the Minister, put forward the following propositions: (1) According to the Continued Tenures Act (cl 5, pt 6, sch 2) and the terms and conditions of the permissive occupancy, it is terminable at will by the Minister at any time. (2) Consequently, the right or licence which the Commonwealth has by virtue of the permissive occupancy is capable only of being exercised by the Commonwealth personally and is not a proprietary right which is capable of being transferred by conveyance, assignment or other operation of law; (3) The purported assignment by the Commonwealth pursuant to the Minister's declaration followed by the giving up of the site to the applicant terminated the right of occupation formerly residing in the Commonwealth by virtue of the permissive occupancy; (4) The Network Sale Act cannot operate at law to create a new permissive occupancy in the applicant because interests or entitlements to occupy Crown land can only be created in terms of the Crown Lands Act 1989 (s 6). (5) The Network Sale Act operates to vest only those rights or interests which are capable of being sold, assigned or otherwise transferred. It has no operation in relation to the permissive occupancy.

Mr Campbell QC contended that the clear intention of the Network Sale Act is to allow the applicant to stand in the shoes of the Commonwealth concerning the operation of the national transmission network. It does so in part by assigning those rights which are property rights, in part by assuming the benefit of privileges, rights and immunities, in part by assuming the benefit of any contract and by bearing all liabilities. Accordingly, it is beyond the point to speak of a "transfer" of the permissive occupancy. Rather, the notion of the Network Sale Act is one of novation or vesting, not transfer. Nor is there any point in speaking about "personal rights". The "assets" which are referred to in the Network Sale Act contemplates both property and personal rights. In particular, s 3(b) defines "asset" as including "any right, privilege or immunity". It is the duty of the Court to give effect to the clear intention of the Network Sale Act and the permissive occupancy was not revoked by the Minister's declaration.

In my opinion, the proper approach to the consideration of the question of whether the Minister's declaration operates to revoke the permissive occupancy is, firstly, to determine the legal characteristics of the permissive occupancy, secondly, to construe the Network Sale Act and, thirdly, to determine what effect, if any, the Network Sale Act, properly construed, has upon the permissive occupancy.

In Barrow v Brooksby , Sugarman J was concerned with the question as to whether an appeal lay to the Land and Valuation Court from the decision of a local land board about conflicting applications for a permissive occupancy. In holding that the Land and Valuation Court had no jurisdiction, his Honour said it was not necessary to decide whether a permissive occupancy is a tenancy or a licence, but his Honour considered the characteristics of a permissive occupancy in the following passage at p 17: To what category in the law is a permissive occupancy to be referred? Is it a tenancy, or is it … a personal licence for valuable consideration? The form of document which is required to be executed by the occupant in terms treats it as a tenancy at will terminable by notice by either party … at any time, at a rental payable in advance, and subject to certain conditions as to the removal of improvements and otherwise which are set out in the document. It may be that, notwithstanding that the language of the document is preponderently the language of tenancy the true character of the relationship which it creates is that of licensor and licensee - that is to say that it creates a personal licence for valuable consideration revocable by notice at any time.

His Honour continued at p 19 as follows: If that is the correct view of the granting of a permissive occupancy, if the correct view of it be that it is not concerned with any dealing with or disposition of the land but is concerned only with a question of personal licence such as would afford a defence to an action for trespass, then it seems to follow that it is not concerned with any estate or interest or purpose authorised by the Crown Lands Consolidation Act …

These passages are a powerful indication of the true legal nature of a permissive occupancy, that is, that it is a personal licence. And although Barrow v Brooksby was decided some eight months before the enactment of s 136K, the description provided by Sugarman J was not changed by that section, since it did not invest permissive occupancies with any different or other characteristic than those described.

The finding of Sugarman J that a permissive occupancy is a "personal licence such as would afford a defence to an action for trespass" was quoted with approval in Minister for Natural Resources v New South Wales Aboriginal Land Council and Anor (1987) 9 NSWLR 155 at 161, which in turn was noted with approval Southern Estates Pty Ltd v New South Wales Aboriginal Land Council (1991) 24 NSWLR 320 at 324.

The consequence of the legal characterisation of the permissive occupancy as a licence personal to the Commonwealth is that it cannot be assigned (in Re Davis & Co, ex p Rawlings (1889) 22 QBD 193; The Queen v Toohey and Anor, ex p Meneling Station Pty Ltd and Ors (1983) 158 CLR 327.

I turn now to the Network Sale Act. The proper approach to the task of construction of the Network Sale Act is the statutory requirement to prefer a construction which would promote the purpose or object underlying the Act (s 15AA Acts Interpretation Act 1901 (Cth), s 33 Interpretation Act 1987). It is the duty of the Court to give effect to that object or purpose (Kingston and Anor v Keprose Pty Ltd (1987) 11 NSWLR 404 at 424).

It is apparent that, by means of the Network Sale Act, the legislature intended to set up a mechanism for the sale of the national transmission network, and to that end to ensure that all of the assets and liabilities of the Commonwealth utilised in or derived from the national transmission network were ultimately to reside in the purchaser. This legislative object or purpose is apparent from the Network Sale Act read as a whole, but in particular, from the following provisions:

(a) the long title of the Network Sale Act, which is "an Act relating to the sale of the National Transmission Network"; (b) the definition, in s 3, of "asset", which means, firstly, "any legal or equitable estate or interest in real or personal property" and, secondly, "any right, privilege or immunity"; (c) the provision, in s 9(1)(b), that, after the vesting of an asset in a specified company by publication of a notice of a ministerial declaration, the specified company "becomes the Commonwealth's successor in law in relation to [that] asset"; (d) the similar provision, in s 9(2)(b), that the specified company "becomes the Commonwealth's successor in law in relation to [a] liability".

I do not see any warrant for reading down the definition of "asset" in s 3 so as to confine it to assets of a proprietary rather than personal nature. Mr Coles argued, by reference to the personal nature of a permissive occupancy and by reference to cases such as Hepples v Commissioner of Taxation (1990) 22 FCR 1 and Commissioner of Taxation v Cooling (1990) 22 FCR 42 (which dealt with the term "assets" in the context of a taxation statute), that the definition must be read as referring to assets of a proprietary nature which are capable of assignment. Such a reading down of the definition would, in my opinion, frustrate the object and purpose of the Network Sale Act. All assets which are the subject of a ministerial declaration published by notice in the Gazette are intended to pass to the specified company, whether they be personal or proprietary in nature. That is because the whole of the Commonwealth's assets relating to the national transmission network is intended to pass to the specified company.

The formal means of achieving the legislative object and purpose is provided in s 9, whereby the Minister for Finance and Administration may, by notice in the Gazette, make a declaration relating to Commonwealth assets and liabilities, with the end result that a specified company becomes the successor in law of the Commonwealth to the assets and liabilities specified in the declaration. So far as concerns the permissive occupancy the subject of these proceedings, s 9(1)(a) is critical and it bears repetition. The Minister's declaration may declare, in relation to a specified company, that: 1(a) a specified Commonwealth asset vests in the company at a time specified in the notice (the transfer time) without any conveyance, transfer or assignment ; (my emphasis)

On its face, and giving the words their plain meaning, the Commonwealth gives effect to the sale of the national transmission network by vesting specified assets in a specified company, without any conveyance, transfer or assignment occurring. The expressions "conveyance, transfer or assignment" may bear a narrower or a broader meaning. The narrower meaning would limit those expressions to the deeds or documents which effect the transfers of title which they contemplate, that is, a deed of conveyance, a memorandum of transfer or a deed of assignment. On the other hand, the broader meaning of those expressions encompasses the distinct legal acts which they describe, that is, the legal acts of conveyance, transfer or assignment. The draftsperson chose the word "vest" to denote the act of passing the specified assets to the specified company, and s 9(1)(a) expressly states that the act of vesting would occur "without any conveyance, transfer or assignment". Accordingly, I would interpret those expressions in their broader meaning. It is the act of vesting which passes the assets to the specified company, not any act of conveyance, assignment or transfer.

Furthermore, the word "vest" is not synonymous with the words "transfer", "assignment" or "conveyance". Its meaning is "to pass into possession; to devolve upon a person or possessor" (Macquarie Dictionary).

I have not ignored the fact that the word "transfer" is used in several ways in s 9. It is used in the heading to the section - "Transfer of assets and liabilities". It is used in the expression "the transfer time" and also in the expression "the transferred asset". In my opinion, however, the draftsperson intended by the use of this word to refer to the act of "vesting", and did not intend that the word "vest" should be read down so as to refer to the act of effecting a transfer of title, that is, the narrower meaning of the expressions "conveyance, transfer or assignment".

I am fortified in my adoption of a broader meaning of those expressions by the mechanism which s 9 establishes. The act of vesting takes place upon the publication of a notice in the Gazette. It does not take place by means of any formal deed or document of conveyance, transfer or assignment. In other words, no specific act or process associated with conveyancing, transfer or assignment (such as a deed or other document) is required to give effect to the passing of assets to the specified company - that effect is achieved via publication of the notice in the Gazette. If the narrower meaning of those expressions were to apply, then the expressions would simply be otiose, because the act of vesting by notice published in the Gazette suffices to pass the assets, and it would not be necessary to refer to the fact that it is done "without conveyance, transfer or assignment".

It follows from the construction which I have adopted that the Ministerial declaration did not have the effect of revoking the permissive occupancy. The Minister declaration, or, more accurately, the notice published in the Gazette, did not assign the permissive occupancy and thereby bring it to an end. The permissive occupancy must properly be regarded as falling within the definition of "asset" in s 3, although it amounts to no more than a personal right of the Commonwealth. As such, it fell within the class of Commonwealth assets which could vest in a specified company if so declared by the Minister of Finance and Administration by notice published in the Gazette. And the publication of a notice which specified the permissive occupancy as one of the included Commonwealth assets was effective to vest the permissive occupancy in the applicant "without conveyance, transfer or assignment". Hence, there was no assignment which could operate to revoke the permissive occupancy, and it remains on foot.

Finally, it is necessary to bear in mind that cl 6 of document 'E' provides that the tenant shall not part with possession of the premises, and accordingly, the vesting of the permissive occupancy in the applicant and the applicant taking possession of the land at Mount Sugarloaf might, on the face of it, be regarded as a breach of the terms of the permissive occupancy and insufficient to vest it in the applicant. That consequence is, however, dispelled by s 12 of the Network Sale Act, which provides that the operation of pt 2 (containing s 9 amongst other sections) is not to be regarded as a breach of any contractual provision prohibiting, restricting or regulating the assignment or transfer of any asset or liability.

For the foregoing reasons, I hold that the Court has jurisdiction to answer the preliminary question, and I provide that answer as follows: Question:

Whether the permissive occupancy granted by the Minister was revoked by reason of the declaration made by the Minister for Finance and Administration on 29 April 1999?

The proceedings should be stood over to a call-over before the Registrar for directions as to their further disposition.

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