Whether reasonable attempts have been made to obtain the easement or an easement having the same effect
134 Subsection 88K(2)(c) has two limbs, which require the following questions to be answered:
(i) what attempts has Mr Sodhi made to obtain the easement sought in the summons, and are they reasonable attempts?
(ii) what attempts has he made to obtain an easement having the same effect as the easement sought in the summons, and are they reasonable attempts?
The requirements of the subsection are not satisfied unless the Court concludes both that all reasonable attempts have been made by the plaintiff to obtain the easement now sought in the proceeding, and that all reasonable attempts have been made by the plaintiff to obtain an easement having the same effect ( Khattar v Wiese (2005) 12 BPR 98,174 at [54]-[55]; Tregoyd Gardens Pty Ltd v Jervis (1997) 8 BPR 97,688 at 15,855; Property Partnerships Pacific Pty Ltd v Owners of Strata Plan 58482 [2006] NSWLEC 709). Consequently, it is insufficient that the plaintiff has made all reasonable attempts to obtain the easement he seeks from the defendants, if the evidence shows that he has not explored all reasonably available alternatives. For the reasons I shall give, the first but not the second of these limbs is satisfied in the present case.
135 As regards attempts to obtain the easement sought in the summons, the Proposed Right of Way, I have set out earlier in these reasons for judgment the negotiations in which Mr Sodhi engaged in 2002 and then, subsequently, in proposing an exchange of easements late in 2003. The effect of my findings is that in 2003 Mr Sodhi did not engage in an attempt to obtain the easement that he now seeks, but instead he engaged in a successful negotiation by which he was granted a contractual licence. In late 2003 he attempted to obtain an agreement for the granting of the easement that he now seeks but the consideration that he offered was an easement over Lot 158 which, according to the evidence, Mr and Mrs Stanes did not want. That cannot have been a reasonable attempt to obtain the easement. Mr and Mrs Stanes would be entitled to compensation if an easement were to be imposed upon their land, and at that stage Mr Sodhi did not offer any compensation beyond the proposed easement over Lot 158 and the fact that he had contributed money and labour to the construction of the road.
136 Subsequently there was a chain of correspondence between the solicitors for the parties, during the course of which Mr Sodhi's solicitor offered compensation. In his letter dated 21 January 2004, the solicitor for Mr and Mrs Stanes rejected an allegation that their clients had agreed to an exchange of easements, but he added that Mr and Mrs Stanes might consider granting an easement if they were properly compensated, and suggested that Mr Sodhi should pay for the costs of an independent valuer to value the proposed easement. In subsequent correspondence the parties exchanged valuation reports assessing the valuation impact of the grant of the proposed right of way over Lot 234. By letter dated 31 May 2004 Mr Sodhi's solicitor wrote to Mr and Mrs Stanes' solicitor enclosing Mr Delahunty's valuation report dated 20 May 2004 and offering to pay compensation in the assessed amount of $5,500. Mr and Mrs Stanes' solicitor rejected this valuation report and eventually, under cover of a letter dated 3 November 2004, sent Mr Sodhi's solicitor a compensation assessment report by Mr Dovers of North Coast Valuation Service dated 4 October 2004, which assessed compensation at $32,000. By letter dated 3 March 2005 Mr Sodhi's solicitor rejected Mr Dovers' compensation assessment, enclosing a critique prepared by Mr Delahunty and dated 1 March 2005. However, in a without prejudice letter of the same day Mr Sodhi's solicitor communicated his client's offer to pay compensation of $7,000 plus costs. Then on 21 June 2005 the offer was increased to $15,000 plus costs, noting that $16,000 had already been paid by Mr Sodhi of the construction of the road (Mr Sodhi's evidence at the hearing was that he in fact paid $17,000, but Mr Stanes said the correct figure is $16,000).
137 This evidence satisfies me, on balance, that Mr Sodhi has made all reasonable attempts to obtain the easement sought in the summons. The evidence shows that Mr Sodhi has been prepared to engage in a course of negotiation, and to consider and respond to matters put to him by Mr and Mrs Stanes. His original proposal for compensation for a lower figure was revised after he received Mr Dovers' compensation estimate of $32,000. The subsequent correspondence shows his continuing willingness to negotiate. The case law shows that "reasonableness" is a matter of degree, and the court must consider the likelihood that consensus would be reached if any further steps were taken (Coles Myer NSW Ltd v Dymocks Book Arcade Ltd (1996) 7 BPR 14,638; Tregoyd Gardens at 15,855).
138 In my view a plaintiff may satisfy the requirement in s 88K(2)(c) to show that he made all reasonable attempts to obtain the easement proposed without having to establish that he offered the amount which the court, with the benefit of all of the evidence tendered at the hearing, finds to be the amount necessary for fair compensation. Depending upon the surrounding circumstances, it may well be enough to show a willingness to negotiate and respond reasonably to the other side's expert opinions and contentions (compare Katakouzinos v Roufir Pty Ltd (1999) 9 BPR 97,796 at [75]-[77]). The correspondence in evidence exhibits a reasonable approach to negotiations by Mr Sodhi and, it must be said, a less clear and more ambiguous approach to negotiations by Mr and Mrs Stanes. Unlike the plaintiffs in McKeand v Thomas [2006] NSWSC 1028 at [139], Mr Sodhi was prepared to offer compensation while insisting (wrongly, according to my finding) that he had a specifically enforceable agreement for the grant of an easement. I am satisfied that in all the circumstances, reasonable attempts have been made by Mr Sodhi to obtain the easement proposed in the summons.
139 However, it seems to me that the second limb of s 88K(2)(c) is not present in the present case; that is, I am not able to conclude on the facts that all reasonable attempts have been made by Mr Sodhi to establish an easement having the same effect as the easement proposed in the summons. It is necessary to consider, on this issue, whether reasonable attempts have been made in respect of
(i) the Reserve Road;
(ii) Lot 2;
(iii) Lot 3.
As I shall explain, my finding is that s 88K(2)(c) is satisfied in respect of the Reserve Road and Lot 2, but it is not satisfied in respect of Lot 3.
140 As with the first limb, s 88K(2)(c) requires that all reasonable attempts be made, not all possible attempts be made, and consequently the requirement may be satisfied where the plaintiff has not approached the registered proprietors of all adjoining properties over which access might be granted, when there are many such properties, and has deferred taking further steps until the applicable consent authority has made a relevant decision (Durack v De Winton (1998) 9 BPR 97,721 at 16,446-8 per Einstein J). Similarly, where there are two alternative properties over which a satisfactory easement could be obtained, and the plaintiff has approached the second landowner and has been firmly rebuffed for apparently valid reasons to do with disruption and costs, the plaintiff need not push the matter further against that landowner (Tregoyd Gardens at 15,856). The issue is whether the attempts that have been made constitute all of the attempts that are reasonable in the circumstances.
141 In Khattar v Wiese at [55]-[58], Brereton J compared the easement proposed by the plaintiffs with an alternative location, noting that the alternative was much longer, would involve additional cost, and might not satisfy a condition of a deferred commencement approval, and he reached the conclusion that the alternative was not an easement having the same effect as the proposed easement. But another alternative site would serve the purpose of the plaintiff's proposal by connecting the plaintiff's properties to the existing drainage system, and the disadvantages of the second alternative were not so great as to entitle the plaintiff substantially to disregard it. His Honour treated the second alternative as one having the same effect as the plaintiff's proposal, and found that s 88K(2)(c) was not satisfied. The case indicates that the question of "same effect" is to be addressed in a pragmatic way, having regard to the function of the proposed easement and the respective advantages and disadvantages of the alternatives. The statutory language does not require that the alternative easement be precisely the same in every detail, but only that as a matter of commonsense it achieves the same purpose as the easement proposed by the plaintiff. On that approach, which I accept, the fact that the two main alternatives to the plaintiff's proposed easement in the present case would provide him with access to Lot 158 from the north and east respectively, rather than (as proposed) the south, does not prevent the court from concluding that these alternatives have the "same effect" as the plaintiff's proposal.
142 As to the Reserve Road, I have already expressed my conclusion that access over the designated site to Lot 158 is impossible and that being so, there are no reasonable attempts that could be made to obtain an easement over the designated site of the Reserve Road, but have not been made.
143 As the Lot 2, I have referred to evidence showing that an access road to Lot 158 would have to pass in a semicircle very close to the Peters' house. That acute proximity means, in my view, s 88K(2)(c) does not impose any obligation on Mr Sodhi to make any further attempt to obtain a right of way over Lot 2. In terms of the language of the subsection, there are two ways of expressing this conclusion: that any right of way over Lot 2 would be so unsatisfactory that any attempt to secure the easement would ipso facto be unreasonable; and in view of the impact on the amenity of Lot 2, an easement over that lot would not have the same effect as the easement proposed in the summons.
144 As to Lot 3, I have noted that the construction of an access road from the entrance of the existing road near that the banana shed at the northern end of Lot 158, progressing up the hill to the southeastern corner, would involve substantial cost. But the fact that an alternative easement may be costly does not of itself establish that all reasonable attempts have been made to procure it, especially where precise evidence of the cost has not been given.
145 I have also noted the evidence that there is bad blood between the Sodhi and Benning families and that the Benning family may be reluctant to negotiate with Mr Sodhi until the Pacific Highway upgrade negotiations have been finalised. But those morsels of evidence do not amount to a case that all reasonable attempts had been made by Mr Sodhi to obtain an easement over Lot 3. The fact that there is bad blood between the families is not a sufficient justification for not seeking to negotiate a commercial transaction, and the impact on such negotiations of impending road widening is a matter for speculation.
146 In my opinion an easement over Lot 3 along the road from the banana shed to Unwins Road falls within the statutory description of "an easement having the same effect" as the easement proposed in the summons. It is true that an easement over Lot 3 would provide access only to the lower, northern end of Lot 158. But it would serve substantially the same purpose as an easement over Lot 234, because it would provide the owner of Lot 158 with access to land that would otherwise be landlocked. The evidence indicates that the access road to Lot 158 is already constructed, sealed in part, and at a gradient much lower than the gradient through Lot 234. Further, the road was in fact used by Mr Sodhi and his family for several decades up until sometime in the period from December 2003 to April 2004.
147 My conclusion is that Mr Sodhi could have done substantially more to explore the prospect of securing alternative access through Lot 3, and should have done so before initiating the present proceeding. He has failed to satisfy s 88K(2)(c) with respect to an alternative easement providing a right of carriageway over Lot 3 along the marked unsealed and bitumen roads from the banana shed to Unwins Road. I should add that I was referred to Simpson v Bagnall [2000] NSWSC 930. That is a case where the court found that the failure to make inquiries about an obvious alternative route led to the conclusion that s 88K(2)(c) was not satisfied. While that case contains a succinct and useful statement of principles by Bergin J (at [99]-[103]), the case is not closely analogous and my determination on this issue is based closely on the facts concerning Lot 3.