Shree Shirdi Sai Sansthan Sydney Limited v Nirmal Taluja

Background and notice of motion

On 19 December 2014 I delivered the primary judgment in this matter: Shree Shirdi Sai Sansthan Sydney Limited v Taluja [2014] NSWSC 1825 (primary judgment). Terms defined in that judgment bear the same meaning in this judgment. The parties asked for the matter to be relisted due to a dispute over the proposed final orders.
The background facts to this matter are set out at [4]-[18] of the primary judgment. In brief, the matter concerned a dispute in relation to an option agreement regarding 800 square metres of land surrounding a chapel (known as the Memorial Chapel). The plaintiff is a religious organisation devoted to the worship of an individual named Shirdee Sai Baba, whom it regards as a saint. The defendant is the registered proprietor of the property the subject of the dispute.
The plaintiff and defendant entered into a lease agreement which included an option to renew (cl 2 of Annexure A) and an option to purchase (cl 12 of Annexure A). The primary dispute concerned whether the plaintiff exercised the option to purchase. The issue now exciting the attention of the parties is whether the term "right of use" in cl 12.3 of the lease should be construed as granting an easement. Clause 12.3 is in the following terms: 12.3 We will provide right of use over the Common Areas and Right of Way to the Land prior to the Transfer other than the Brundah Dining Hall.

Consideration

The notion of an easement is that one tenement has rights over another; one tenement is benefited, the other is in some way afflicted. Although a right of way is a particular, identified type of easement, I am not satisfied this militates against the construction of "right of use" as granting an easement over the land in question. Easements (eg. riparian rights or an easement for sewerage) are not restricted to rights of way - a right of way is merely one species of usage.
In this case, I am satisfied that the phrase "right of use" is apt to be construed as granting an easement. The "right of use" in question in this case is no different to a right to use particular parts of a servient tenement for parking or similar. I do not think, in this context, that the parties intended to confer an easement for right of way but merely a licence for use. As pointed out by the plaintiff, the only way of securing this interest as binding successors in title is for it to be a registrable interest.
I am also cognisant of the poor drafting of the lease agreement and, as such, I accept that little can be drawn from the difference in capitalisation. I consider that both parts of cl 12.3 should be construed as granting easements. Similarly, I consider that the ambiguity concerning the timing of the grant of the easement is attributable to the drafting.

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