Owners Strata Plan 13635 v Ryan

Owners Strata Plan 13635 v Ryan - [2006] NSWSC 221 - NSWSC 2006 case summary — Zoe

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6146/04 The Owners - Strata Plan No 13635 and 2 Others v Jennifer Marie Ryan JUDGMENT 1 HIS HONOUR: This is an application pursuant to s 88K of the Conveyancing Act 1919 (NSW) ("s 88K") for an order imposing an easement over the land of the Defendant. The Defendant owns property known as 44 and 46 Cabramatta Road, Mosman (which I shall refer to collectively as "the Property"). 2 The First Plaintiff is an Owners Corporation of land on which has been constructed a block of four units: that property is known as 49-51 Spencer Road, Mosman, and I shall refer to it as "49". The Second and Third Plaintiffs own a property known as 47 Spencer Road, Mosman (which I shall refer to as "47"). The rear of each of 49 and 47 abuts onto a lane. The Property is in fact a battle-axe block, the very thin handle of which is the lane lying, in the main, south of 42 Cabramatta Road and to the north of 49 and 47. The owner of 42 Cabramatta Road has no involvement in the case, that property being fenced at its rear to the lane. At the edge of the eastern end of the laneway is a concrete driveway on land presumably owned or controlled by the Mosman City Council ("the Council") which driveway extends from Bardwell Road west to the commencement of the lane. A photograph of this concrete driveway is annexed to the affidavit of Mr Lawrence Winnacott ("Mr Winnacott") of 18 February 2005. Photographs of the lane (which is not paved) are annexed to the affidavit of Mr Mark O'Neill of 11 February 2005, a valuer retained by the Defendant. 3 On the property comprised in 47 and very close to its rear boundary is located a garage with its roller door facing north to the lane. On the property comprised in 49 and very close to its rear boundary, is a garage with its entrance door facing east and in front of the garage there is an area of concrete described as a "hard-stand" on which up to two cars can be parked. That garage has been there since at least 1958 (para 9 of the affidavit of Mr Thomas Noel Crogan ("Mr Crogan") of 12 November 2004). The hard-stand, which was created in or about 1978, extends to the edge of the northern boundary of 49. The owners of 47 and unit owners on 49 have used the respective garages and hard-stand in the past to park vehicles, but the Defendant has since 30 June 2004, by steps which I shall describe, precluded the lane from being used by the Plaintiffs, which has prevented use of the garages on 47 and 49 and the hard-stand on 49. 4 The Plaintiffs, by way of Summons, now seek the imposition of easements in favour of 47 and 49 over the laneway pursuant to s 88K, which relevantly is in the following terms: 88K Power of Court to create easements

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(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. … 5 The precise terms of the easements sought in the Amended Summons (and they are rights of way in favour of 47 and 49 respectively) are to be found as an Annexure to the affidavit of Mr William Douglas Kimber ("Mr Kimber") of 9 November 2004. There is no dispute by the Defendant that if an easement were to be granted by the Court, the form of it set out as the Annexure to Mr Kimber's affidavit is appropriate (although I deal with its western extremity later in these reasons), or that the words used by Mr Kimber to describe that easement set out in his affidavit are apt. The entitlement to relief pursuant to s 88K is, however, strenuously resisted. 6 On Monday 20 March 2006 a view by the Court was held in the company of Mr Anderson of counsel, who appears for the Plaintiffs, and Mr Armfield of counsel, who appears for the Defendant. Their respective solicitors and clients were present, as was Mr Winnacott, a town planner retained by the Defendant. 7 A strata plan for the units (constructed many years earlier on 49) was registered on 9 December 1978, and issued on 22 January 1979 (see Annexure A to Mr Crogan's affidavit of 12 November 2004). The strata plan for 49 refers to a Deposited Plan No DP3909. That plan (which by the date inscribed upon it seems to have been lodged in November 1902) is Annexure B to Mr Crogan's affidavit of 12 November 2004. Lots 29 and 30 and part of Lot 31 Cabramatta Rd described in that Deposited Plan constitute the Property (see the Certificate of Title at p 23 of the Defendant's affidavit of 19 February 2005 which helps identify the relevant lots). Lot 32 Spencer Road in the Plan is 49 and Lot 33 Spencer Road is 47. Running between the rear of the Property and 47 and 49 is depicted a strip of land with the words "reserved 10 feet wide". The strip runs parallel to the whole length of Cabramatta Road and Spencer Road (not just behind 47 and 49); it would appear to be a laneway that allowed night soil to be removed in the days before sewerage pipes. I shall in the balance of these reasons refer to the reserved land in DP3909 as "the laneway" and to the strip of land immediately to the north of the rear of 47 and 49 as "the lane". DP3909 was also annexed to the contract of sale for the Bryant's purchase of 47: see Annexure B to Mr Patrick James Bryant's affidavit of 11 November 2004. The strata plan for 49 depicted the garage on 49, to which I have referred, and described it as Lot 3 of the strata plan: see Annexure A to Mr Crogan's affidavit of 12 November 2004. 8 Mr Bryant and his wife, Mrs Deborah Ann Bryant, purchased 47 in October 1997. The contract of sale by which they purchased the property had annexed to it a copy of DP3909. When they inspected the property they saw a fibro garage at the rear of the backyard. The garage had, and still does have, a roller door at its northern side facing onto the lane. Also annexed to the contract of sale for 47 was a survey report which shows the lane as a "lane" and refers to "DP934755". That deposited plan was not annexed but I invited the parties to obtain a copy of it. It is Exhibit 4 and it shows what appears to be a lane with figures inscribed (they are hard to read but it seems with the aid of a magnifying glass to state "10"4 per", which I take to be "perches"). It does not say "lane", "laneway" or "reserve", but it depicts the laneway. Also annexed to the contract for sale is a Metropolitan Water Sewerage and Drainage Board diagram, which shoes the Board's sewer running at the rear of 47 in what is described as "lane". 9 On or after 6 February 2004, DP1064885 was lodged with the Registrar General. It appears that 44 Cabramatta Road and 46 Cabramatta Road, which had had separate titles, were owned respectively by Mr Ian Kirkwood and Mr Douglas Kirkwood, and they had applied to consolidate the two titles prior to the sale of the Property to the Defendant. Mr Ian Kirkwood resided in 44 Cabramatta Road, and 46, it seems, was tenanted. It was a condition of the contract for sale from the Kirkwoods to the Defendant that the plan of subdivision for the Property be registered: see para 2 and pp 15 and 17-18 of the Defendant's affidavit of 19 February 2005. The new consolidated property (ie the Property) has two lots: Lot 1 is essentially what is known as 44 Cabramatta Road and Lot 2 is what is known as 46 Cabramatta Road. I shall refer to Lot 1 as "44" and Lot 2 as "46" in the balance of these reasons.

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15 There were, in 2003, negotiations between the Plaintiffs on the one hand and Mr Ian Kirkwood on the other in relation to the easement. At one point Mr Kirkwood sought $300,000 from the owners of the units and $100,000 from the Bryants, but by facsimile of 17 July 2003 (p 40 of Mr Bryant's affidavit of 11 November 2004) solicitors for Mr Ian Kirkwood indicated that Mr Kirkwood would consider the right of way for the sum of "$25,000.00 plus costs (per user)". Treating that as indication of a willingness to accept an offer it would equate to $100,000 if there are three car spaces on 49 and one on 47. 16 There was a dispute as to what precisely was the order of conversations, but the facsimile of 17 July 2003 was expressed to be final and appears to have been the last communication from Mr Kirkwood. Mr Armfield, during the course of the hearing, conceded that s 88K(2)(c) had been made out, so I do not need to resolve the factual dispute on that point, or the subsequent position when the Defendant became the owner of the Property. 17 In 2004, when the Defendant advised the Plaintiffs by letter that she would be fencing the areas adjacent to their property (see p 42 Mr Bryant's affidavit of 11 November 2004), Mr Crogan, on behalf of the Owners Corporation wrote in reply on 14 June 2004 seeking an opportunity to discuss the matter, as did Mr Bryant. A meeting was held subsequently on 20 June 2004, but no agreement was reached and the meeting ended with Mr Crogan indicating that he would be making an offer. That offer was made through solicitors acting on behalf of all of the Plaintiffs: see p 44 of Mr Bryant's affidavit of 11 November 2004, and was for the payment of $28,800. 18 Shortly after the meeting, the Defendant embarked on a process of precluding the Plaintiffs from using the laneway. She demanded that they stop using the laneway (which they did). There was correspondence between the solicitors for the Plaintiffs and the Defendant but no resolution was achieved. The Defendant, in September 2004, sought Council approval of a development application, which included construction of a sliding gate at the eastern entrance to the lane, which precluded use of the garage or hard-stand at the rear of 49, and the garage of 47. These proceedings having commenced on 16 November 2004, and the Council having been made aware of them, the Council responded to the development application by letter of 30 March 2005 to the Defendant indicating approval but which was to be "not activated until you satisfy Council as to the outcome of Supreme Court proceedings regarding the right-of-carriageway": Exhibit 2. In May 2005, the Defendant erected the sliding gate, and at about the same time she erected a fence across the front of 47's garage and across the hard-stand of 49, blocking off completely any access to the laneway by the Bryants and the unit owners at 49. The fences erected can be seen as Annexures A, B and C to Mr Crogan's affidavit of 8 March 2006. The sliding gate is not connected to electricity and does not presently lock. The Defendant explained these steps as being related to her security and that of her daughter and use of the property and to enable her to bring her two dogs onto the property (paras 16 and 17 of her affidavit of 19 February 2005).

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19 By her development application in September 2004 the Defendant, in addition to the gate, sought approval for development of the Property. Its main features, other than the sliding gate off Bardwell Road, were an extension of 44 on the rear ground floor, some internal alterations, a new front fence, and an external rear deck: see Exhibit 1. 20 Those plans were approved on 7 March 2005, but as I have noted, approval was expressed to be subject to the outcome of the Supreme Court proceedings: see Exhibit 2. 21 In February 2006 the Defendant lodged another development application, a copy of which is annexed to her affidavit of 15 March 2006. It seeks approval to install a hard-stand off street parking space in the front of 46, with associated vehicular crossing over the footpath in front of 46 in Cabramatta Road, removal of the tree on the footpath in Cabramatta Road, and extension of the rear deck by a further five square metres: see p 2 of Exhibit 3. 22 Mr Armfield conceded that there were respects in which it was more convenient to be able to park on the property, but there was evidence from the Plaintiffs concerning the specific problems that lack of access to the rear of their property had caused. Mr Crogan is now 83, although to his credit he eschewed any suggestion that he or his wife are infirm. Ms Haege, another unit holder, is 74 and has had significant surgery and is obviously frail. She gave evidence of the long distance she has to walk from where she can park her car to her unit. There was some issue about how far this was precisely and how often she is able to prevail upon a friend to allow her to park in the friend's driveway, but I do not think it matters - her evidence is that it is more convenient to park at the rear of 49 and reliance on a friend for parking favours is a very uncertain relief. Mr Bryant is a relatively young man. Mr Crogan finds it difficult to obtain parking near 49 (there is a chicane immediately outside 49 and the street has a number of these to slow traffic). He has had his vehicle stolen when it was parked in Spencer Road and Ms Haege has had an experience of youths inside her car when parked in Spencer Road. The evidence was objected to on the basis that problems and difficulties particular to the owners, produced by not having the easement, is not relevant. Reference was made to Hanny v Lewis (1998) 9 BPR 16,205. I admitted the evidence subject to relevance and will deal with the evidentiary point below. 23 The Defendant, as a fall-back position, asserts that 47 can have a hard-stand installed at the front, and the unit owners (or at least Ms Haege) can apply for a disability sticker and a disability parking spot in Spencer Road. 24 The party seeking an order under s 88K must establish four things, namely:

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26 The question of what is meant by "reasonably necessary" has been considered in a number of cases in this court: O'Mara v Gascoigne (1996) 9 BPR 16,349; Re Permanent Trustee Australia Ltd (1997) 8 BPR 15,551; Goodwin v Yee Holdings Pty Ltd (1997) 8 BPR 15,795; Tregoyd Gardens Pty Ltd v Jervis (1997) 8 BPR 15,845 per Hamilton J; Durack v de Winton (1998) 9 BPR 16,403; 117 York St Pty Ltd v Proprietors of Strata Plan No 16123 (1998) 43 NSWLR 504; 8 BPR 15,917 per Hodgson CJ in Eq (as he then was); Hanny v Lewis (1998) 9 BPR 16,205 per Young J (as he then was); Marshall v Council of the City of Wollongong (2000) 107 LGERA 73; 10 BPR 18,163; [2000] NSWSC 137 per Bryson J (as he then was); Kent Street Pty Ltd v Council of the City of Sydney (2001) 10 BPR 18,757; [2001] NSWSC 268; Beekman v Gray (2002) NSW ConvR 56-016; [2001] NSWSC 531; Blulock Pty Ltd v Majic (2001) 10 BPR 19,143; [2001] NSWSC 1063; King v Carr-Gregg [2002] NSWSC 379 per Foster AJ; Busways Management Pty Ltd v Milner (2002) 11 BPR 20,385; [2002] NSWSC 969; Woodland v Manly Municipal Council (2003) 127 LGERA 120; [2003] NSWSC 392; Pasade Holdings Pty Ltd v Sydney City Council (2003) 11 BPR 21,001; [2003] NSWSC 515. Two more recent cases have come to my attention since the hearing of this matter: Khattar v Wiese [2005] NSWSC 1014 and Gordon v Shaheen [2005] NSWSC 1328. 27 Mr Armfield placed considerable emphasis on Hanny v Lewis (1998) 9 BPR 16,205. In Hanny, the property purchased by Mr Hanny was steep. It had steps from Hanny's property to higher ground, which steps were on a right of way of which Mr Hanny's property had the benefit - Mr Hanny had purchased the block and constructed a new house on it. He was in poor health and sought an easement to install an inclinator over the right of way to which the Defendants, owners of adjoining blocks, objected. Young J (as he then was) held that the right of way as it existed did not accommodate installation of an inclinator and he also refused to grant an easement pursuant to s 88K. 28 In Hanny, dealing with the s 88K application, Young J pointed out at 16,209 that:

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34 Mr Armfield's argument on the test of "reasonably necessary" had three elements. First, he submitted that 47 and 49 were residential dwellings which had street-front access, both pedestrian and vehicular, on Spencer Road, and hence were not land-locked. Their "use", he said, as residential dwellings had no impediment because the only means of vehicular access was via Spencer Road. He developed this idea by pointing to the fact that Mosman has many houses which have no off-street parking at all and the point was expanded to include Paddington (see Durack v de Winton (1998) 9 BPR 16,403). Thus, he said, the easement sought did not go to "use" at all. 35 The second point he made was that "mere desirability" and "absolute necessity" were the two ends of the spectrum identified in the decisions. Absolute necessity did not have to be established, but it was clear that mere desirability or preferability were not enough. He submitted that the weight of authority supported the proposition that something close to necessity, albeit not absolute, was required. Use of the laneway, he submitted, was very much in the realm of preferability and desirability, and not sufficiently far along the continuum to be sufficient, for the same reasons that were articulated in support of the first argument. He argued that Hanny was authority for his client's position because the plaintiff there sought an easement for an inclinator when he already had a wooden staircase that enabled him to reach the top of the cliff. He pointed to Young J's comment that "the tone of the word 'necessary' is getting close to something which is a vital requirement" in the passage I have set out in [30] above. 36 The third element in Mr Armfield's case was his assertion that the long history of user of the lane was irrelevant. He submitted that there being clear authority (see Williams v State Transit Authority of NSW (2004) 60 NSWLR 286) that there was no room for easements of prescription over Torrens title land (unless an easement had existed and had not been included in the register when the land was brought under Torrens title), and that to permit long user to have any relevance, would be to permit by the back door that which had been excluded by the front. 37 This last point led to a further related question of whether the NSW cases thus far pointed to an acceptance of the relevance of past user. 38 Mr Anderson's riposte to the first point was that the Defendant's approach focuses too intently upon the house (on 47) and units (on 49). It being agreed that this was not a "development" case, what s 88K is relevantly concerned with here is "reasonably necessary for the effective use … of other land that will have the benefit of the easement". "Land" is defined in s 7 of the Conveyancing Act as: "'land' includes tenements and hereditaments, corporeal and incorporeal, and every estate and interest therein whether vested or contingent, freehold or leasehold, and whether at law or in equity". 39 There is also a definition (and there was no dispute that this definition was relevant) in s 21 of the Interpretation Act 1987 which is: "'land' includes messuages, tenements and hereditaments, corporeal and incorporeal, of any tenure or description, and whatever may be the estate or interest therein." 40 I was referred to Osborne's Law Dictionary (Sweet & Maxwell). The 9th edition contains the following definition: "a house, including gardens, courtyard, orchard and outbuildings".

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The High Court has held in Royal Sydney Golf Club v Federal Commissioner of Taxation (1955) 91 CLR 610 at 625 that "messuages": "means not only the house itself but the outbuildings, courtyard, garden and adjacent land used and occupied with it." 41 The use of the "land" therefore, submitted Mr Anderson, includes use of the garages and hard-stand, and they cannot be used for their intended purpose unless there is access from the laneway. 42 In answer to the Defendant's second point, the Plaintiffs submit that the statement of principle by Hodgson CJ in Eq in 117 York St Pty Ltd v Proprietors of Strata Plan No 16123 (1998) 43 NSWLR 504; 8 BPR 15,917 is the appropriate test to be applied to this case, and ought to be followed, it having been accepted as appropriate and followed in a number of cases. Mr Anderson argued that adopting the test of Hodgson CJ in Eq in 117 York St, the use of the land would be "substantially preferable to the use of the land without the easement", and that was sufficient. Hanny was a quite different case, he submitted, because there the plaintiff had bought land without any inclinator on it, and wanted to expand what was there from a set of stairs to an electronic conveyance, because of his heart condition. 43 So far as the third point is concerned, the Plaintiffs relied on a number of cases in which past user was regarded as significant: see below at [60]-[63]. 44 Mr Winnacott, town planner, gave evidence on behalf of the Defendant. His view was that the easements in favour of 47 and 49 were not reasonably necessary for the effective use of 47 or 49 (p 12 at para 7.0 of his affidavit of 18 February 2005). His views were based on the fact that there were many residential properties in the Mosman area which did not have off-street parking. With respect to 47 he noted that the Bryants could apply for front of house parking (p 11 at para 6.1). He thought that the front of 47 had once been used as a hard-stand for a car: the street kerb in front of 47 had a driveway depression and there was different brick work in front of the small courtyard (p 9 at para 5.1 of his affidavit). That view as to the prior existence of off street parking at the front of 47 was not challenged in cross examination. 45 The report does not set out the questions which Mr Winnacott was asked to answer (the letter from the Defendant's solicitors does not actually indicate this either). The conclusion reached however, is that: "I consider that such an easement [the proposed right of carriageway] is not reasonably necessary for the effective use or development of either No. 47 or Nos. 49-51 Spencer Road Mosman"

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(p 12 para 7 of Mr Winnacott's affidavit of 18 February 2005). 46 In cross examination Mr Winnacott agreed that the interest of the Mosman Development Control Plan ("DCP") was to prefer car parking at the rear where it is possible, or to the side of the dwelling where possible (T100-101) but he said if not available the DCP has a preference for car parking in front of the dwelling on a hard-stand: T101.3-7. There was also a tree preservation policy: T101. Mr Winnacott agreed that the intent of the DCP was to prefer car parking at the rear. He had no knowledge of the Defendant's recent application for parking at the front of 46 and was reluctant to comment on whether that application would "fly in the face of" the DCP, see T102.4-19 but he did agree that the DCP "certainly does prefer car parking at the rear and one would think where car parking is presently available at the rear, that would be a preferable situation to dispensing with that and replacing it with car parking at the front": T102.21-29. 47 He agreed that if the tree at the front of 46 makes a positive contribution to the streetscape of Cabramatta Road, "you would think it would be undesirable to remove it": T102.40-44. I interpolate here that the tree was pointed out to me on the view: it is a substantial mature tree that seemed to add positively to the appearance of Cabramatta Road, and I note that Mr Winnacott, who was also present on the view, did not say anything in his report or his oral evidence to suggest otherwise. 48 Whether the easements sought are reasonably necessary is really a question for this Court. That does not mean that Mr Winnacott cannot express his view on the topic, but his view seems to be largely, if not entirely, based on the fact that many other properties in Mosman do not have off-street parking, and that a house and units can be lived in without the benefit of off street parking. 49 So far as the first point is concerned, I accept the Plaintiffs' submission that the garages, gardens and hard-stand are part of the land, and use of those areas for parking is a "use" of the land even though it is not strictly a use of the residential building. I would arrive at the same conclusion even without resort to the extended definition of "land" in s 21 of the Interpretation Act. 50 I turn now to the second point, as to how close to absolutely necessary "reasonably necessary" needs to be. In 117 York St Pty Ltd v Proprietors of Strata Plan No 16123 (1998) 43 NSWLR 504; 8 BPR 15,917, (a case concerning both a temporary easement for scaffolding access and a permanent gutter easement) Hodgson CJ in Eq formulated his approach thus at NSWLR 508-509: "(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."

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51 I note that in Re Seaforth Land Sales Pty Ltd's Land (No 2) [1977] Qd R 317, only one member of the Court of Appeal, Hanger CJ, examined what was meant by "reasonably necessary", and he made reference to cases dealing with what was an alteration that was "reasonably necessary or proper" to enable premises to be let: see at 330A-B. 52 I have read the extract from Hansard of the Second Reading Speech of the then Attorney General that was provided to me by Mr Armfield. Neither he nor Mr Anderson argued that it added anything to an understanding of the legislative purpose relevant to this matter, save that Mr Anderson submitted that it contained an express recognition of the desire of the legislature that the servient tenement owner should not be able to hold the dominant tenement owner to ransom (although this seems in the speech to be directed to developments rather than use). 53 I respectfully adopt Brereton J's summary of the authorities dealing with this question in Khattar v Wiese [2005] NSWSC 1014 at [24]-[27]: [24] Conveyancing Act , s 88K(1) requires that the proposed easement be "reasonably necessary for the effective use or development" of the land to be benefited. It does not require that the easement be absolutely necessary for that use or development, nor that the proposed use or development be the only reasonable use of the land to be benefited; thus the requirement may possibly be satisfied even when the applicant's land could be effectively used or developed without the easement [ Tregoyd Gardens Pty Limited v Jervis (1997) 8 BPR 15,845 (Hamilton J); Goodwin v Yee Holdings Pty Ltd (1997) 8 BPR 15,795 (Windeyer J); Re Seaforth Land Sales Pty Ltd's Land (No 2) [1977] Qd R 317; 117 York Street Pty Limited v Proprietors of Strata Plan 16123 (1998) 43 NSWLR 504, 508G-509D; Katakouzinos v Roufir Pty Limited (2000) 9 BPR 17,303; [1999] NSWSC 1045, [38]]. [25] 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 [ 117 York Street , 508G-509D; Katakouzinos v Roufir , [38]; Blulock Pty Limited v Majic (2001) 10 BPR 19,143; (2002) NSWConvR 56-012; [2001] NSWSC 1063, [14] (Windeyer J)]. [26] Accordingly, where, as in a case such as the present, a particular proposed use or development is in contemplation, the first question is whether that proposed use or development is a reasonable one (in comparison with the possible alternatives); and the second is whether that use or development with the proposed easement is substantially preferable to that use or development without the proposed easement. [27] The authorities repeatedly point to the confiscatory nature of s.88K as requiring firm proof of the reasonable necessity for the easement, and that the court bear in mind that property rights are valuable rights not lightly to be taken away [ Re Seaforth Land Sales Pty Limited v Land [1976] QdR 190, 193 (Douglas J); Nelson v Calahorra Properties Pty Limited (QSC, Thomas J, 5 December 1984; affirmed [1985] QConvR 54-202); Ex parte Edward Street Properties Pty Limited [1977] QdR 86, 91 (Andrews J); Re Worthston Pty Limited [1987] 1 QdR 400, 402-3 (Carter J); Tregoyd Gardens , 15,853-4; Durack v D E Winton (1998) 9 BPR 16,403, 16,449 (Einstein J); Hanny v Lewis (1999) 9 BPR 16,205; (1999) NSWConvR 55-879, 56,875; Woodland v Manly Municipal Council (2003) 127 LGERA 120, [2003] NSWSC 392, [15]-[18] (Hamilton J)]. The extent of the burden of the proposed easement on the servient property is a relevant consideration, to the effect that the greater the burden, the stronger is the case needed to justify a finding of reasonable necessity [ Katakouzinos v Roufir , [42]; Woodland v Manly Municipal Council , [12]]. 54 It is the second element of Hodgson CJ in Eq's formulation which has been emphasised in some cases (eg Hanny; King v Carr-Gregg [2002] NSWSC 379 at [45]; Grattan v Simpson (1998) 9 BPR 16,649) rather than the first, but the first element considers the use (for which the easement must be substantially preferable) and requires that it must be at least "reasonable" as compared with the possible alternative uses and developments (a point reiterated by Brereton J in Khattar at [26]). 55 I note that in Gordon v Shaheen [2005] NSWSC 1328, Hamilton J accepted Brereton J's reiteration of principles subject to only one concern, which was the addition of the word "substantially" in the phrase "substantially preferable". 56 Not only did Young J quote the second part of Hodgson CJ in Eq's formulation in 117 York Street in Hanny with apparent approval, but he did so again in Grattan, so I do not think Young J can be seen as propounding a view contrary to 117 York Street. 57 If I am wrong in that view, the formulation found in 117 York Street has been now accepted and applied in many cases, (see also P Butt, "Land Law", 5th ed, LawBook Co, 2006, p 463), and I think it appropriate to proceed on the basis that the bipartite test of Hodgson CJ in Eq is how "reasonably necessary" is to be interpreted. 58 Whilst I am of the view that Hodgson CJ in Eq's formulation grapples with and answers the question of how far along the continuum for "reasonable necessity" the applicant must travel, even if I were wrong in that conclusion, if one focuses on the use as being the use of the garages and hard-stand for parking, then the easement is in any event necessary, and hence a fortiori "reasonably necessary", and the requirements of s 88K(1) are met. 59 In Re Permanent Trustee Australia Ltd (1997) 8 BPR 15,551, one of the uses for which a rear lane in the City of Sydney was important was to enable a car park within the building to be utilised. Hodgson J (as he then was) did also refer to the lane as being the only means of access to the fire escape for the building, and used to enable repairs to the rear of the building, but his reference to use of the car park within the building points to that being a use relevant to the grant of an easement, whereas on the Defendant's contention it would not be. 60 I turn to the question of past user. In Permanent Trustee at 15,553, Hodgson J referred to past use in a way which indicated that he regarded it as relevant. There are a number of other cases in which the Court has referred to past use in a way indicating its relevance: see Kent Street Pty Ltd; Marshall v Council of the City of Wollongong (2000) 107 LGERA 73; 10 BPR 18,163; [2000] NSWSC 137 at [6], [17], [20] and [28]; and King v Carr-Gregg at [59]. It is true that in an earlier case O'Mara v Gascoigne (1996) 9 BPR 16,349, Hulme J did not grant an easement notwithstanding use of the defendant's land to access the rear of the plaintiff's property, but the use in question was to enable large tanks to be wheeled out from the plaintiff's workshop, and his Honour found that alterations to the front of the workshop would permit despatch of these larger tanks from the front of the property and that some difficulties of access from the front were not of such an order as to make the easement sought reasonably necessary: O'Mara v Gascoigne at 16,357-16,358. 61 In Kent Street Pty Ltd, Barrett J having referred to 117 York St and Hanny, said: "[13] It is clear in this case that the building on the plaintiff's property, in common with the other buildings surrounding the laneway, has been constructed and is used on an implicit assumption that the laneway is to all intents and purposes a public road. The vehicle entrance, fire exit doors, windows and roof water drainage system of the plaintiff's property have been installed and are used on that footing. It was only recently, as I understand it, that the true status of the laneway title was ascertained by adjoining building owners. When I say recently, I mean only in the last ten years or so and certainly since the buildings on the sites adjoining the laneway were erected. [14] It would be a very heavy burden indeed for the owner of the plaintiff's property now to have to rearrange things so as to avoid using the laneway in the way in which it is currently used. The use of the plaintiff's property with the current arrangements for vehicle access, emergency egress, natural light and roof water drainage must be substantially preferable to its use without those arrangements."

[33]

62 In Marshall, Bryson J (as he then was) said: "[28] If the land had been held under the general law or Old System, in which s 42 does not apply, it seems possible that an easement such as they now claim might already have come into existence by prescription. There may also have been room for an argument that Lot A was entitled to an easement of necessity, as the access actually available was impracticable. I regard it as a relevant consideration, when acting under s 88K, that the plaintiffs' application is made in circumstances which, subject to proof, could give rise to an easement by prescription under the Old System. The situation has arisen over a long period of time, and this is not simply a case where the plaintiffs are seeking the Court's aid to conscript another person's resources to meet a difficulty which has arisen recently, or to the creation of which the plaintiffs contributed. Much valuable land in New South Wales is held subject to the Old System, and there is no element of enormity about the plaintiff's claim. However this while a relevant consideration cannot be a prominent one." 63 In King v Carr-Gregg [2002] NSWSC 379, Foster AJ said: "[59] When one also considers that the pipe has been in situ for twenty-five years and has, apparently, in conjunction with the pipes bringing drainage water from 9 Edward Street and 17 Rosedale Road, operated without significant malfunction or the occasioning of identifiable harm to the Carr-Gregg property, then, in my view, 'reasonable necessity' for the granting of the easement is amply demonstrated. Although the imposing of an easement lies in the discretion of the Court, in my opinion, not to so regularize this important segment of this long established drainage system would be an absurdity." 64 A significant difference between Hanny and this case is that the need for the inclinator arose out of the topographical conditions of the site: it was purchased as a block which had no inclinator access and the house was constructed in that context. In the present case, a lane has existed for more than 100 years and vehicular access has been maintained for a long time - garages have been built to take advantage of that lane access and a plan of subdivision was submitted by the previous owners of the Property, with the knowledge of the Defendant, with a right of way over the lane in favour of 46. In my view, this case is readily distinguishable from Hanny, and is closer to cases such as Kent Street Pty Ltd, Permanent Trustee and Marshall. 65 In relation to the point made about Williams v State Transit Authority of NSW (2004) 60 NSWLR 286, I do not think that the decision can be relied on as an aid to construction of s 88K or as to what is or is not relevant to applications under that section. Williams was concerned with the question of whether easements based on the doctrine of lost modern grant can be asserted or maintained over land governed by the Real Property Act, and held that they cannot, because it is inconsistent with s 178 and the principles of the Torrens system. The question of whether the racecourse could seek an easement by means of s 88K was not considered. 66 I note, however, that in the course of Mason P's judgment (with whom Sheller and Tobias JJA agreed) the President said: "[97] Very recently, in Bakewell Management Ltd v Brandwood [2004] 2 WLR 955; [2004] 2 All ER 305, Lord Scott of Foscote said (at 964; 314 [27]): 'The acquisition of easements by long uninterrupted user that has been open, free from force and not dependent upon any precatory permission from the servient owner serves a well-recognised public policy. In Davis v Whitby [1974] Ch 186 at 192 Lord Denning MR said "… the long user as of right should by our law be given a lawful origin if that can be done" and Stamp LJ … agreeing with Lord Denning, commented "… if long enjoyment of a right is shown, the court will strive to uphold the right by presuming that it had a lawful origin". More recently Lord Hoffmann in R v Oxfordshire CC ex p Sunningwell Parish Council [2000] 1 AC 335 at 349 said: "Any legal system must have rules of prescription which prevent the disturbance of long-established de facto enjoyment".'

[46]

(10) I infer from (7), (8), and (9) that at the very least, the Council has no objection to the use of the lane for access to parking at the rear of 47 and 49. 69 There was evidence that pointed to knowledge being acquired by Mr Baxter, the then owner of 49, in 1965 that the lane was in fact owned by 44 and was not a public access lane. I think it is reasonable to infer from the documents at pp 77-83 of the Defendant's affidavit of 19 February 2005, that Mr Baxter was informed of this fact, but it does not appear that there was any objection to use of the lane from any quarter (and the Council itself appeared to be considering some future use of the lane: see p 80 of the Defendant's affidavit of 19 February 2005), and in 1978 the strata plan was approved. 70 There was little evidence about use of the lane by the owners of 44 or 46, but Mr Crogan said that Mr Ian Kirkwood used the lane to drive his vehicle to the rear of 44 when he lived there. There is a hard-stand on 44 (which can be seen in the photograph at p 9 of the Defendant's affidavit of 20 June 2005). According to the Defendant, the tenant of 46 has not recently used the lane, but this was due to the state of the lane (see T85.30-43), and the Defendant said she has occasionally used the lane to pick up rubbish. The easements lodged and approved indicate that whatever the use of the lane actually made by 46, it was intended that it would be used as a right of way. 71 I conclude that rear off street parking is a use which has been made of the land at 49 for more than 40 years, and for a less clearly discernible but not insubstantial period of time by 47, and that the lane has for a considerable time been utilised for access to that parking (as well as access to parking on 44 and 46). 72 I find in respect of each of 49 and 47 that the use is a reasonable use and that the use of 49 and 47 with the easements is reasonably necessary for use of those lands, and that easements over the lane in favour of 49 and 47 should be imposed.

[47]

Not inconsistent with public interest 73 The Defendant's argument here focused on the fact that the lane is 3.02 metres wide and that Council now require a carriageway to be 3.5 metres wide when the number of cars to use it is between two and 25: see p 26 of Mr Crogan's affidavit. I do not think there is any substance in this point. The Council approved the strata plan for 49 in 1978, which included a garage where one is presently situated and required installation of a hard-stand next to it. There was no precise discussion as to how Council approval was obtained and how the condition of a hard-stand was imposed, but there was no dispute that lodgement of the strata plan entailed such approval; see Div 4 ss 36-40 of the Strata Titles Act 1973. 74 The Council also approved the lane as a carriageway under the s 88B instrument lodged for the subdivision involving 44 and 46 Cabramatta Road (see p 17 of the Defendant's affidavit of 19 February 2005) and they approved the siting of a mirror on a post in Bardwell Road in 1996 (see para 20 and p 18 of Mr Crogan's affidavit of 12 November 2004). The Council has constructed or permitted to be constructed a concrete driveway from Bardwell Road to the start of the lane. 75 The Defendant's position involves removing four off-street parking spots (leaving out of account her expressed current intent to remove parking for Lot 1). The Council wishes to encourage off-street parking: see Annexures at pp 22-26 of Mr Crogan's affidavit of 12 November 2004, and the area is a heritage conservation area - where streetscapes are important and the Council regards off street parking as preferable (see also T102 in the evidence of Mr Winnacott where he accepted that rear parking was preferable). 76 I think that s 88K(2)(a) makes it clear that it is use of the dominant land having the benefit that must not be inconsistent with the public interest. Provision of an easement which permits up to three owners of units in 49 to utilise off street parking at the rear of the premises rather than to collectively search for parking spots in a street with no obvious abundance of parking and chicanes to restrict traffic flow, seems to me to be entirely consistent with the public interest, so that I find this second condition amply satisfied, it being a test only of "not inconsistent" with the public interest. 77 Provision of easements which permit 47 to utilise off-street parking at the rear of the premises rather than seeking permission to install a hard-stand in the front of 47 in a heritage conservation area, seems to me to be a use entirely consistent with the public interest, so that again I find this second condition amply satisfied. All reasonable attempts 78 As I have noted, the Defendant does not now dispute that all reasonable attempts were made by the Plaintiffs to obtain an easement. Because it has some relevance beyond this point, however, I set out the Defendant's version of what she said to the Plaintiffs at her meeting with them on 20 June 2004 (para 10 of Defendant's affidavit of 19 February 2005): "I said words to the effect: 'This is private land. My problem is this is forever. I have to maintain it and I will have no privacy or security. I have a 13 year old daughter who is often home alone after school when I am at work. Anyone could walk down the rear access at any time. I look straight into the backyard of the flats and I don't want to see it.' Mr Crogan: 'The people in the flats are good people and we know them all.' I said: 'Yes. But that can change.' Mr Crogan: 'We want to continue the existing use.' I said: 'I am not really interested. I might be interested for $100,000.00.' Mr Bryant: 'I was told that it is worth no more than $10,000. I am not interested. Oh forget it. I can put a carport out the front.' Mr Crogan: 'We will get back to you with an offer.'" 79 Mr Crogan's version of the reference to $100,000 (para 30 of Mr Crogan's affidavit of 12 November 2004) was that the Defendant said: "I could be interested in allowing you all a right of carriageway for $100,000 or more."

[60]

(9) The plaintiff has to establish what the relevant losses and disadvantages are as part of satisfying the Court that the persons affected can be adequately compensated: 117 York Street at 516, but onus should not be overemphasised: see Wilson v Forrester-Babcock (2000) 10 BPR 18,377; [2000] NSWSC 1208, and unfavourable inferences can be drawn where evidence of facts is peculiarly within the knowledge of the defendant: Mitchell at [34]. 86 In support of the Defendant's position that she could not be adequately compensated for the loss of enjoyment of the land and/or that as a matter of discretion the easement should not be granted, the Defendant relied on two principal matters - her loss of security for herself and her daughter and privacy if the easement is granted. The privacy element had an aesthetics component. Mr Anderson squarely put the Defendant's credit in issue and submitted that she ought not be believed, and further that she had set about, in effect, creating facts to bolster her position. 87 In her affidavit of 19 February 2005, the Defendant said the following: "15. I found the use of the access by vehicles using my land very intrusive. There were cars using the access at all hours of the day and night, but there are no trees or fencing to reduce noise or lights and I felt as though they were driving into my back yard. As well as the noise, I had no privacy or security in my back yard. It felt like people were in my back yard as I could see and hear them from the house. As there is no fencing or garden, people from 49-51 Spencer Road look into the back yard of 44 Cabramatta and vis [sic] versa due to the units wanting to use my rear access. In the event that the proposed right of carriageway required by the First and Second Plaintiffs is granted, I will not be able to plant any trees or fence to give me any privacy or protection. 16. As I work full time, my 13 year old daughter is often at home by herself and I am concerned for her safety and the fact that I cannot secure the back yard. Anyone could walk into my backyard. 17. I am not able to keep my dogs, Frank a Keeshond and Cheryl a Jack Russell as the back yard is unfenced. Prior to settlement I left the dogs with my mother, intending to bring them back when I had fenced the rear access and put a gate in. My mother has asked several times when I am taking the dogs. I still have not been able to bring my dogs back due to the delay caused by these proceedings. 18. I feel very insecure knowing that anyone may just walk into the back yard when I am at work and my daughter is at home by herself or when we are both at home. This concern has only increased as the dogs are still away." 88 These concerns about privacy and security of her daughter were reiterated in cross examination, and I accept that the Defendant did articulate some of these concerns in her first conversation with the Plaintiffs (see [31]-[35] above). 89 Leaving aside the fact that Council did not permit installation of the sliding gate prior to these proceedings being determined, and leaving aside the question of whether, given that these proceedings were on foot, it was appropriate for the Defendant to install the gate and the fencing, the Defendant chose to install a gate at the eastern end of the laneway. If security is a real concern then that problem could be addressed in the future by installation of a sliding gate commencing at the rear boundary between 44 and 42 Cabramatta Road, ie near the western end of the lane (and sliding north to south across the lane). The Defendant did not accept that installation of the gate there would be a solution - saying at T81.50 that she could not put it there because it would block 46's access to 44's lands. Mr Anderson then sought from the Defendant an explanation as to why putting a gate at the eastern end was any different (T81.57-T82.58). The Defendant asserted that a gate in that position would not be suitable to the Plaintiffs because it would restrict their right to reverse onto her land. That observation was more or less correct at the time it was made, because the extent of reversal required had not been explored (the Plaintiffs now accept that the easement can be reduced in length to permit a gate to be installed at that western location) but it does not explain why the gate installed at that western location would be unacceptable to the Defendant. 90 It is the Defendant's intention to install an electronic locking device on the installed gate, to be operated with a remote control: see T82.11. The idea of the Bryants and the unit owners at 49 having remotes to that gate or to the gate now located at the eastern end led her to describe the maintenance as "horrific", both of the driveway and the "electrics": T86.18-25. Mr Anderson asked her whether a commercial grade gate and remote control could be used and the Defendant stated that the cost would be an obstacle: T86.39. I do not accept that the location of a sliding gate electronically operated by remote control presents any difficulties and I regard the Defendant's responses as consistent with an attempt to defeat the application irrespective of its merits. Whilst I doubt that the gate as installed had any other function than as an assertion of the Defendant's proprietary rights, any security concerns can be met by such a gate installed at the western end of the lane. 91 The Defendant asserted that there was use of the lane "at all hours of the day and night" and that the noise and lights gave her the feeling they were driving into her backyard. The Bryants' use of the laneway is a north-south ingress and a south-north egress at the most easterly end of the laneway. Mr and Mrs Crogan are in their eighties and Ms Haege is a 74 year old lady with a walking stick. There was no suggestion that they or any of the other unit holders were noisy, unruly or living a lifestyle that would be frowned on by any of Mosman's more conservative residents. Not only that, but the entrance to 49 is quite some distance (approximately six metres) from the southern edge of the main block of 44. The Defendant could not be affected by lights from cars using the lane (fenced behind 42 Cabramatta Road and at a lower level than the main part of the house) at night if she was in her bedroom. Both bedrooms of her house are located at the front, close to the carport at 42 Cabramatta Road, to the use of which the Defendant did not object. It is difficult to imagine any disturbance arising from car lights of unit holders in any part of the Defendant's house, particularly the upper level, as it is presently constructed, and it is unlikely that significant noise will be caused by vehicles using the lane at what, by reason of the lane's narrow width, will necessarily be slow speed. 92 I have referred earlier to the evidence given by the Defendant in her affidavit concerning the problems of lack of privacy and aesthetics. The Defendant had also asserted this in her conversation with the Plaintiffs in June 2004. In cross examination she said that the gate would not solve the problem of privacy as she: "could see into their backyards. I wanted to put a fence up, put a garden there. I wanted to have a nice outlook from my deck. The security might have been sorted out, but not the privacy, and not just the aesthetics of it all" (T84.57-85.4).

[68]

A. Possibly." 95 Both experts expressed the view that the lane was suitable only as a right of way (perhaps due to its width) and the question of whether the Defendant could park in the lane and the easement still be effective was not explored. The Defendant could not park in the lane and allow access to 46. Nor was there any evidence of what the difference in value between 44, with the ability to park on the lane (assuming that to be possible), as opposed to parking on the hard-stand, would be. This was probably because it had not been part of the Defendant's case that that was a use that she wished to make of it (see the letter of instruction to Mr Winnacott, which is quite inconsistent with that notion; see also T79.11-29, although I think in the context, the reference to parking was to parking at the rear of 44 rather than in the lane itself). 96 There is no dividing fence between the rear of 44 and the rear of 46 and as Mr Anderson demonstrated in cross examination, the Defendant has no ready means of protecting her daughter or herself from unwanted intrusion from the tenants of 46 or their guests. The Defendant did say that she could choose her tenants but nevertheless, the "security" concerns seem to me to be exaggerated, as was her non-responsive answer at T64.37. The fact that the sliding gate is not presently locked also tends to undermine the claimed emphasis on security. The stated desire to bring her two dogs onto the property given as the reason for the fence, has not, the Defendant agreed, been fulfilled, although her explanation for one of the dogs not being brought was that it had grown "too old and ill" (ie since May 2005) (T85.24). 97 The application for parking at the front of 46 lodged in February this year is curious. The application was made after receipt by the Defendant of Mr Dundas' expert report in which he stated that the existence of the right of way in favour of Lot 1 (46) over Lot 2 (44) is very relevant to his conclusion that compensation due to the Defendant should be nominal. The application to have front parking as a precursor to removal of the right of way in favour of 46 and its timing had the appearance of being designed to remove the foundation of Mr Dundas' report. Mr Anderson enquired of the Defendant as to why the application was lodged so late and the answer (T91.37-47) is not inconsistent with that perception and the Defendant accepted that there was nothing to require her to proceed with the development if approval is given by Council: T88.29-52. In my view, the Council is unlikely in any event to accept the removal of rear off-street parking for 46 and its replacement by front off street parking with consequent removal of a well established tree but I do not accept that the application was connected to any matter beyond the exigencies of this litigation. 98 The Defendant now also seeks to extend her deck even beyond that which she sought in her development application in September 2004, to bring it even closer to the south-eastern edge of the Property and hence closer to what is, and will have to continue as, a narrow fenced lane, unless the right of way in favour of 46 is removed. 99 The Defendant asserted that the building approval from the Council (for the gate) was not conditional upon resolution of the proceedings, saying it was "not an issue at all to the Council" (T78.47-53), whereas Exhibit 2 demonstrates that it was an issue. 100 The Defendant's assertion that she needed to fence the Bryants' garage in order to contain her dogs (T77.16-22) was undermined to some degree by her admission that she had never seen the roller door up; the side gate to 47 was then given as an explanation (T78.9), but it is not at all clear why the existence of a side gate required fencing to be installed across the roller door and the side gate. It was also undermined by her failure to bring the dogs, or at least one of them, onto the property at all, notwithstanding that she had erected the fence. 101 In addition to these matters there were two specific items of evidence of the Defendant which I did not find plausible:

[73]

(4) loss in use of affected land ("loss of amenity"). 104 For blot on title he allowed $1000 for the easement in favour of 47 and $2000 for 49. 105 For present disturbance he noted that the lane was already there but allowed $1000 for minor works and inconvenience connected therewith. 106 For future disturbance he considered the likelihood of future work and cost as so remote as to have virtually no effect but allowed $1000 for each easement. 107 In relation to amenity he pointed out that the proposed easements have no further impact on the use of the servient tenement. The shape of the lane (it is approximately 24 metres long and 3 metres wide) and the fact that there is a sewer main along its length "greatly limits its use". Whilst the easements would create some extra vehicular traffic "again this is considered of a minor nature and will have virtually no further effect on the servient tenement". He allowed $1000 for this for each property. In total then, he assessed compensation as $4000 for the easement in favour of 47 and $5000 for the easement in favour of 49. In addition he recognised that 47 and 49 should be responsible for all costs involved in establishing the easements. 108 In comparison to the total of $9000 assessed by Mr Dundas, Mr O'Neill, a valuer called by the Defendant, came to a significantly different figure, viz $63,000. Mr O'Neill agreed with the four categories outlined by Mr Dundas. 109 In relation to blot on title, he agreed that 44 was presently burdened by a right of way in favour of 46 "to use the existing lane for vehicular access to that property". He was of the view that enabling a "further five properties to drive to and from the rear of their properties utilising the said right of way" is not a significant negative reflection on the value of the property but "will burden the title of the subject property to a greater degree than presently exists". Thus he assessed $10,000 for the "blot on title". Mr O'Neill's reference to a further five properties was based on an assumption that there are four units on 49 and then adding 47. The Plaintiffs point out that although there are four units, there are only three parking spots (and only two of them are really available if the garage is not in use). I do not think it is the number of units that is relevant, but rather the number of car spots. Although I can well understand the difficulties of parking three cars at the same time, there was no evidence from the Plaintiffs about this and I proceed on the basis that traffic will be for three cars from 49 and one car from 47. It should be noted that 47's use of the lane is minimal: the vehicle must cross the lane at its easternmost point, rather than drive down it for any significant distance. 110 Mr O'Neill agrees that the present disturbance factor is minimal - he allows $2000, but this includes sealing, and there is no requirement for sealing. For future disturbance, Mr O'Neill allows $1000 (ie less than Mr Dundas, who assessed these extra items on a per property basis). 111 In relation to the loss of amenity factor, Mr O'Neill assessed the figure at $50,000, in comparison to Mr Dundas' $2000 (total). 112 Mr O'Neill's report focuses on several matters to support this conclusion: the increased traffic flow, and likelihood of incoming and outgoing vehicles meeting on the right of way. He again assumes five additional "properties" and assumes that 49 will have a three carport garage. He says at p 6 of his affidavit: "The benefit derived by these properties in terms of added value is considerable with provision of off-street parking carrying a premium of $40,000 to $50,000 per property. The owner of no. 44 is therefore providing a windfall capital gain of $200,000 to $250,000 to the five properties." 113 He regarded the addition of five extra vehicles using the rights of way as a negative effect, and "could extend to vehicles from nos. 49-51 backing onto the property of no. 44 in seeking to exit along the right-of-way". He adverted to additional security issues with tenants "coming and going at frequent intervals and the possibility of noisy vehicles or motor bikes late at night". This, he said, was a significant negative factor. 114 He also expressed the view that at least $150,000 of the differential in price paid for 44 over 46 was due to 44 having the extra land providing vehicular access. He said that he considered $50,000 to be a fair and reasonable value to reflect the loss caused by the easement, in perpetuity. In his final paragraph he stated: "In summary, the total compensation payable to the owners of no. 44 is $63,000 which, in my opinion amounts to a reasonable figure to reflect the negative impact on the value of the property, particularly when this amount is compared to the potential enhanced value of the plaintiffs' properties. I am of the opinion that if all of the paries were to negotiate a sum to reflect the loss to no. 44 and the potential gains to nos. 47 and 49-51 by legalising this vehicular access, then a figure of $63,000 would be a reasonable outcome to all concerned." 115 In cross examination of Mr O'Neill, it was put to him that his conclusion had been much influenced by the $50,000 "windfall" to each of the dominant tenements. He denied that it had been, notwithstanding the emphasis on this aspect in his report. He asserted that the use of the windfall factor was just a cross-check. Mr Anderson submitted that it had been just a cross-check because use of the windfall approach would lead to a much higher figure. 116 If one removes the benefit to 47 and 49 and the portion of the price that Mr O'Neill estimated was paid for 44, there is not really much of an explanation for the $50,000, other than the number of users and possible reversing onto 44. 117 One way of considering the matter from the Defendant's point of view is to consider to what discount, if any, a purchaser of 44 would obtain if, instead of buying 44 with only 46 having a right of way, he or she was buying with 47 and 49 also having right of way. 118 I raised this with Mr Dundas, and Mr Armfield took up the issue: see T49-52. Mr Dundas seemed to think that $50,000 would not be an unreasonable figure, but he made it clear that this was in terms of what 47 and 49 might be willing to accept for the easement to be removed: T52.37-39. I accept that that sort of assessment is the reverse image of the negotiating advantage which has been firmly rejected: see [85] (8) above. Mr Dundas reiterated his view that "granting an easement upon another easement of a parcel of land which has a sewer main under it does not really impact on the property a great deal but there is no denying it does add value to the other properties": T52.44-48. 119 In my view, Mr O'Neill's approach places too much emphasis on the use of the lane. The entrance to 49's garage is well away from the edge of 44's main block (and if the gate is installed at that edge there will be no reversing onto 44's main block). The garage on 47, as I have noted, is at the other end of the laneway. I also think there are three rather than four users that need to be accommodated for 49. Although it is a minor matter, the easement that the Plaintiffs now seek will not involve the Plaintiffs reversing past a point south of the boundary between 44 and 42. 120 In my view, however, Mr Dundas' approach does not allow sufficiently for either the blot on title due to creation of two additional easements or to the increased usage of the lane by both 49 (three users) and 47 (one user). So far as the blot on title is concerned, whilst I do not accept Mr Armfield's suggestion that five per cent of the property price, rounded to $50,000, would be an appropriate means of arriving at a nominal sum, I think a more substantial sum is required for two additional easements on a property purchased for $1.2 million, and I accept the figure assessed by Mr O'Neill of $10,000. As for a figure to reflect increased usage and the disadvantage to the Defendant in having four additional users of the lane, and hence detriment to the servient tenement, I think Mr Dundas has made no real allowance for that increased usage and hence loss of amenity on a permanent basis, and I would allow a further $20,000 under this head. I would then adopt Mr Dundas' figures for present and future disturbance at a total of $4000. (Mr O'Neill reaches the same total by a different route.) As between the Plaintiffs, the amounts payable should take into account that the $20,000 reflects usage so I would apportion $15,000 to 49 and $5000 to 47; the amount payable for present and further disturbance should be similarly apportioned $3000 to 49 and $1000 to 47. The amount payable for blot on title should be apportioned equally. Thus the Owners Corporation should pay compensation of $23,000 and the Bryants should pay $11,000. Conclusion 121 In my view, the requirements of s 88K(1), (2) and (4) are all met. So far as subs (3) is concerned, I am disposed to make an order in the terms of the Amended Summons paras 1(a) and (d) and 2(a) and (d), subject to two matters. The first is that in my view it is preferable that the easement should extend no further than the conjunction of the boundary of 42 and 44; this would make installation of a sliding gate (should that be considered desirable) at that point easier and avoid any use of the main rectangular block of 44. The second aspect is that as a practical matter, the sliding gate installed at the eastern end of the lane ought be addressed - it cannot remain there if the Plaintiffs do not want it to remain, but if remote access is given to the Plaintiffs, it could be of benefit to both the Defendant (who may not want an additional sliding gate at the western end of the lane) and to the Plaintiffs who will have additional security. 122 It was agreed by counsel that I should leave the question of the precise extent of the easements to be reformulated by the parties if I was of the view that easements should be granted. Costs 123 The parties agreed that I should not at this stage make any final disposition of the issue of costs. I record that the Plaintiffs seek an order that their costs be paid by the Defendant, notwithstanding the statutory recognition that normally the applicant for an easement will pay the defendant's costs. Whilst I did hear argument on the point, I think it is preferable to await any further submissions following delivery of my reasons for judgment before expressing any view on that aspect of the case. **********

At a glance

Court

Decision date

Before

Source

Judgment (74 paragraphs)

Parties

Legislation Cited (4)

Cases Cited (22)