The Uniting Church in Australia Property Trust (NSW) v Crowe

Cross-Claim filed 19 December 2022 Stephen Desmond Crowe (Cross-Claimant) The Uniting Church in Australia Property Trust (NSW) (Cross-Defendant) Representation: Counsel: Statement of Claim filed 31 October 2022 G A Sirtes SC/ D Robertson (Plaintiff) J Hutton SC (Defendant)

Cross-Claim filed 19 December 2022 J Hutton SC (Cross-Claimant) G A Sirtes SC/ D Robertson (Cross-Defendant)

Solicitors: Statement of Claim filed 31 October 2022 Maddocks Lawyers (Plaintiff) Dentons (Defendant)

Cross-Claim filed 19 December 2022 Dentons (Cross-Claimant) Maddocks Lawyers (Cross-Defendant) File Number(s): 2022/324943 Publication restriction: Nil

JUDGMENT

1. These proceedings arise out of a dispute between owners of adjoining properties at Woollahra in Sydney's eastern suburbs. Part of the plaintiff's land, referred to in the evidence as the "side yard", has for many years been used by the defendant, and his predecessors in title, for recreational purposes. The defendant has built a deck in the side yard. He has also undertaken extension works on his house which project into the side yard. The projecting works are a concrete slab, a balcony, and a roof overhang. The plaintiff, whose title to the side yard is not in dispute, seeks to have the deck and projecting works removed.
2. The properties in question both have a frontage to Edward Street, Woollahra. Number 35 belongs to the plaintiff, The Uniting Church in Australia Property Trust (NSW) ("Church Trust"). Number 33 belongs to the defendant, Stephen Desmond Crowe.
3. Number 35 is one of several adjoining blocks of land acquired by the Church Trust in 1974. The Trust's holding is the site of a retirement village known as "Lough Neagh". The village includes a number of buildings but the Edward Street frontage of number 35 is vacant and undeveloped.
4. The house on number 33 is a multi-level one which was originally built in the early 1960s for Mr Bruce Gyngell and his family. Mr Gyngell was a well-known television executive. The house was designed by a prominent Sydney architect of the day, Mr W E ("Bill") Lucas. According to the evidence, it has significant heritage value as an example of the "Sydney style" of architecture.
5. Since Mr Gyngell, number 33 has had a series of owners. Mr Crowe bought it in 2003 with his former wife and is now the sole proprietor.
6. Use of the side yard goes back to Mr Gyngell's time. It contains two flights of outdoor stairs leading to different levels of the house (these are described at [79]-[85] below; I will refer to them as the "upper stair" and the "lower stair" respectively). Mr Gyngell was granted a lease over part of number 35 which included the side yard and the stairs by the Church Trust's predecessor in title at a nominal rent and it appears that he was responsible for first laying out the side yard and building the stairs. But the lease was never registered. On the face of it, Mr Gyngell's successors in title, including, now, Mr Crowe, have never had any legal entitlement to occupy or use the side yard.
7. Since 2003, Mr Crowe has continued to use the side yard for recreational purposes. In 2009, discussions took place between the parties about the possible purchase by Mr Crowe of part of number 35 so that the side yard would become his property. Those discussions petered out in 2010.
8. The construction of the deck and the renovation works projecting into the side yard were undertaken some time in the second half of 2009 or the first half of 2010. Mr Crowe did not seek any formal permission from the Church Trust (or development approval from Woollahra Municipal Council, which is the local council). The then responsible officers of the Trust (who worked at head office, not the retirement village) seem to have been unaware of the works and took no action.
9. About nine years went by. Responsibility for the retirement village land within the Church Trust passed to others who were not familiar with the previous history. In 2019, Mr Crowe refurbished the deck. The officers of the Trust learned of this and became aware of the works on, and projecting into, number 35. They asked Mr Crowe to remove those works and reported the issue to the Council.
10. In 2020, the Council issued a "development without consent" notice. Mr Crowe took no action about the side yard works (although he may have regularised some other works for which permission had not been obtained). Correspondence ensued between Mr Crowe and the Church Trust, but without result. In the course of that correspondence, Mr Crowe lodged a caveat claiming a "proprietary, or equitable" interest in the side yard land.

Claims for determination

1. The proceedings were commenced on behalf of the Church Trust as plaintiff in October 2022. Mr Crowe filed a cross-claim back against the Trust in December of that year.
2. The proceedings have had a somewhat lengthy history which it is unnecessary to recount for the purposes of this judgment. Pleading amendments were made before the trial on both sides, and further extensive amendments were made to Mr Crowe's cross-claim in the course of the trial. The hearing took place over three days from 17 to 19 June. Oral submissions were presented on 5 July, with supplementary written submissions ending on 22 July.
3. There is no dispute about where the boundary between number 33 and number 35 in fact lies. Prima facie, Mr Crowe's use of the side yard is, and has at all times been, a trespass.
4. The principal relief sought by the Church Trust is an order in the nature of a mandatory injunction to remove the deck, and the projecting slab, balcony, and roof overhang, from number 35. Alternatively, damages are claimed for trespass. A claim for similar relief with respect to the upper stair was abandoned in final submissions. No relief was sought at any stage with respect to the lower stair, which has never been the subject of any work by Mr Crowe. As the owner of the land, the Church Trust would of course be prima facie entitled to remove either or both of the stairs at its own expense.
5. The Church Trust has not sought an injunction against Mr Crowe to prevent him from going onto the side yard land (or the balcony, to the extent that it projects into the side yard's airspace). But presumably that is only because no such injunction is necessary. It appears to be common ground that if Mr Crowe fails in his cross-claim, he will have to vacate the side yard (including the encroaching part of the balcony).
6. In the final version of his cross-claim, Mr Crowe advances three claims to enable him to continue to use and occupy the side yard. The first is that he has a legal entitlement to occupy the side yard, which the Court should now recognise. The claim arises in the following way.
7. As already noted, and as I will describe in more detail below, when Mr Gyngell first built the house at number 33 and began to use the side yard for family recreation, he had the benefit of a lease from the Church Trust's predecessor in title, but that lease was never registered. Mr Crowe alleges that he was unaware of the lease at the time he bought the property. But he says that he became aware of it afterwards, and he referred to it in the 2009-2010 discussions with officers of the Church Trust.
8. Mr Crowe puts his claimed entitlement a number of different ways, but principally he alleges that, as a result of the way in which the 2009-2010 negotiations were conducted, he was led to believe that the Church Trust accepted the lease as being binding, and he relied upon that understanding in his subsequent conduct. He claims that, as a result, an estoppel arises in his favour. He does not claim that the estoppel gives him any interest in number 35 which he can sell to a purchaser. But he does contend that it gives him an entitlement, for as long as he lives at number 33, to use the side yard on the same or similar terms as were set out in the lease.
9. Next, and alternatively, Mr Crowe contends that the projecting slab, balcony, and roof overhang (but not the other structures which have been built on number 35) are encroachments for the purposes of the Encroachment of Buildings Act 1922 (NSW) ("EBA"). He seeks orders under the Act granting him a transfer, or an easement, to allow him to maintain the slab, balcony, and roof overhang in place.
10. Thirdly, and in the further alternative, Mr Crowe seeks the grant of a compulsory easement under s 88K of the Conveyancing Act 1919 (NSW) ("CA") to allow him to retain the balcony, slab and roof overhang in place. The easement sought also extends to the use of the upper and lower stairs.
11. Finally, even if his cross-claim fails, Mr Crowe resists the grant of a mandatory injunction requiring him to remove the structures he has built. He also contends that the Church Trust has failed to demonstrate that it has suffered any substantial damage.

Documentary evidence

1. Land and title - numbers 35 and 33: From my description of the facts so far, it may seem strange that land forming part of number 35 has been used for decades for recreation by the owners of number 33 and that the present dispute has only now come to a head. The explanation for this, at least in part, lies in the unusual topography of the land.
2. Lying to the north of the land in question is a three-sided valley, with its opening to the west. On the valley's southern side, the land rises steeply, culminating in a sandstone bluff running from west to east and forming the southern rim of the valley. The southern slopes of the valley (which remain natural bushland) and the valley floor form part of a public park known as Cooper Park.
3. Edward Street runs from west to east at the bottom of the bluff. To the south of Edward Street is View Street, which runs roughly parallel with Edward Street along the flattish land at the top of the bluff. The bluff line lies about half-way between Edward Street and View Street, slightly closer to Edward Street. From the top of the bluff, and the slopes below it, there are views to the north over Cooper Park and towards Sydney Harbour.
4. The land rises very steeply between the southern side of Edward Street and the top of the bluff line further south. It seems as well that, at one point, stone was quarried there. The result is that in some places there are sheer rock faces, interspersed with natural terraces which are roughly flat and are up to a few metres wide. The side yard on number 35 is located on one such natural terrace. It is not accessible from the top of the bluff (or from Edward Street, below) without climbing equipment but it is accessible from the eastern side of the house on number 33.
5. The land in question was first subdivided early last century as part of what was marketed as the "Harbour View Estate". This subdivision consisted of lots on both sides of Edward Street. It followed the earlier subdivision of a strip of land on the northern side of View Street. The Estate formed part of a grant going back to the 1830s and, at the time of the subdivision, remained under Old System title.
6. At their rear, the lots in the Harbour View Estate on the southern side of Edward Street extended southwards past the bluff line to include some of the flattish land at the top, where they backed onto lots created by the earlier subdivision on the northern side of View Street. Six of those View Street lots form part of the Church Trust's holding.
7. Reproduced below is an advertisement for the Harbour View Estate auction sale in 1905. The advertisement includes a plan of the subdivision. Lots 42, 43 and 44 became number 35. Lot 45, immediately to the west of lot 44, became number 33. Houses in the existing View Street subdivision (now long gone) are shown to the south, shaded grey.
8. The road reserve retained for Edward Street (which came to be vested in Woollahra Council) was wider than it needed to be for the roadway. The street was built close to the northern side of the reserve, leaving an area of the reserve several metres wide between the lots south of Edward Street and the edge of the street itself.
9. At least in the past, this road reserve seems to have been of little or no economic value. By agreement with the Council, lot 45 was extended up to the road for the purpose of constructing the house on number 33. Number 37, on the eastern side of number 35, has been extended in a similar way. But, presumably because the Edward Street frontage of number 35 has never been developed, there remains an area of road reserve between it and Edward Street itself.
10. Miss Agnes May Turkington was the Church Trust's predecessor in title. Her holding consisted of six lots in View Street, together with number 35, and, perhaps, other land as well. She had inherited the land in the 1930s and she gave it to the Church Trust (then the Methodist Church (NSW) Property Trust) by transfer dated December 1974.
11. When Miss Turkington inherited number 35, it remained under Old System title. As I will describe in more detail below, it was converted to Torrens title in February 1964, becoming lot 1 in DP216881.
12. Number 33 was purchased by Mr Gyngell in July 1961. At the time, it too, was under Old System title. It was converted to Torrens title in March 1966 (Lot 45 in DP 226775). Later, after the lot was extended northwards to include part of the road reserve, it became Lot 33 in DP1053956.
13. Reproduced below is a survey plan depicting the Church holding, which is outlined in red. Number 35 (Lot 1 in DP 216881) can be seen on the Edward Street frontage, between number 33 (which is mislabelled 37) to the left and number 37 to the right. The View Street lots owned by the Trust are lots 24 to 29 in DP1952. The Church Trust holding also includes two small parcels of land (lots A and B in DP14780) at the top of the cliff behind number 37.
14. Reproduced below is an aerial photograph showing the relevant properties. The retirement village complex can be seen between the line of the top of the cliff to the north and View Street to the south. Number 35 is shaded in yellow and the approximate boundaries of the side yard are shown in red.
15. Construction of house on number 33: Plans for the house on number 33, annotated by Mr Lucas, were in evidence before me. An initial set of plans were approved (subject to some minor conditions of amendment) by Woollahra Council in September 1961, and the amended plans were approved in May 1962. The house, when built, was the subject of an article in the December 1966 edition of Home Beautiful magazine, which was also in evidence.
16. I also had the benefit of expert evidence from Mr Peter Lonergan. Mr Lonergan is a Sydney architect with a special familiarity with Mr Lucas' work (in fact, in his earlier days in practice, Mr Lonergan worked with Mr Lucas). Mr Lonergan produced a report for the purposes of the proceedings and gave supplementary oral evidence.
17. Mr Lonergan's report involves, to a considerable extent, the drawing of inferences about historical events. That, for the reasons I gave in Sheppard v Smith [2021] NSWSC 1207 at [13]-[15], is probably not, strictly speaking, a matter of expert evidence. But the inferences Mr Lonergan drew were almost, if not completely, undisputed. In any event, they corresponded with inferences which I would draw from the historical material in evidence.
18. Much of the site consisted of steeply sloping hillside. Three natural terraces ran across it, roughly east to west, but curving slightly southwards. I will refer to these as the "top", "upper" and "lower" terraces. Under the eastern half of the front edge of the lower terrace was an existing retaining wall, built from sandstone rubble. The front edges of the upper and top terraces consisted of natural rock (see the construction site plan at [47] below).
19. From north to south, the lower terrace was about six metres wide at the eastern boundary of number 33, with only a slight incline towards the south. Behind it was a virtually sheer sandstone cliff face. The upper terrace was not as wide and the natural wall behind it appears to have been an area of steep hillside (see the photograph at [111] below) rather than a cliff face.
20. The living areas of the house, at the rear, were built into the upper and lower terraces. The roof of the house was at approximately the same level as the front edge of the top terrace. That terrace extended back to the southern boundary. It was left undeveloped and appears to have been used as a garden (the site plan refers to an "existing rockery"). It was not accessible from View Street.
21. A sketch from the Home Beautiful article which shows the main internal features of the building (from the west) is reproduced below:
22. As the sketch shows, the house featured an internal staircase giving access to six levels, with two pairs of split-levels making up the living areas. At the top, on level six, were four rooms, one a "utility room" and the other three bedrooms, and, on level five, the master bedroom. Below that was a living room (level four) and a dining room and kitchen (level three). Below that was a small space described as the entrance lobby (level two) and, on level one, an area under the dining room described as the "entrance garden".
23. In front of the house itself was a flat-topped timber structure clad with vertical slats. The top of the structure formed a balcony for the dining room on level three. At ground level, another staircase descended from the "entrance garden" on level one, through the space enclosed by the front structure, and down towards the street.
24. The front part of the house and the timber structure in front of it are pictured from the north-east on the cover of the Home Beautiful magazine, reproduced below:
25. At the front of the house (levels one, three and five), the building extended across the whole width of the property. Behind that, it stepped in about 2 metres from the eastern boundary. Running along the eastern side of the house at ground level, between the living room on level four and the boundary, a concrete terrace (to which I will refer as the "lower terrace patio") was built. Erected over this was a timber structure which was partly a balcony accessible from level six and partly a pergola. Extensive glass sliding doors were installed on the eastern side of the living room and the rooms above to allow outdoor access and take advantage of the light from the east. By contrast, there were no windows or doors on the western side, which faced an existing house built on the block immediately to the west.
26. Reproduced below is a plan of the site in its pre-existing state, with the construction work for levels one and two superimposed. The front edges of the natural terraces are shown by lines running across the site. The line for the front edge of the lower terrace is difficult to see, but on the western side it lies behind the internal staircase on levels one and two; to the east of that staircase the line is obscured by a handwritten note referring to the "existing sandstone rubble wall".
27. Reproduced below is the plan for levels three and four. The living room can be seen on level four opening onto the lower terrace patio. The northern end of the lower terrace patio ended at the front edge of the lower natural terrace, with the sandstone rubble wall beneath (see photo at [106] below). The southern end the lower terrace patio ended at the foot of the rock face behind. The southernmost part of the living room was excavated into that rock face.
28. Reproduced below is the plan for levels five and six. The balcony/pergola structure above the lower terrace patio extended along the eastern side of the utility room, bedroom two and the front half of bedroom three on level six. The southern end of the structure curved to accommodate the front edge of the upper terrace. The southern part of level six, consisting of the rear of bedroom three and bedroom four, stood on that terrace, with some excavation of the slope behind to accommodate bedroom four.
29. Reproduced below is the eastern elevation (as the photo at [106] shows, the front structure, when built, was completely surrounded by timber slats rather than partially by windows as is shown in the drawing). The drawing shows the use of the natural terraces and the glass doors on levels four and six.
30. The drawing also shows that the sliding door on bedroom four provided access to the two-metre wide strip of upper natural terrace between the house and the eastern boundary of the property. Leading southwards, a flight of steps (not shown in the drawing) climbs up the slope to the top terrace. The lower five steps are concrete and the top two are sandstone, apparently cut into the ledge at the front of the top terrace (see photo at [111] below). Mr Lonergan's opinion, which was not contested, was that these steps were constructed at the time or soon after the house was built. I will refer to them as the "top stair".
31. The next plan in evidence was a survey plan of number 33 (then lot 45) in March 1999, which is reproduced below:
32. The plan shows the balcony (which protruded 5 cm into the air space on number 35) with a straight southern edge, rather than the curved edge in the original plans. Apparently, it had been modified at some point before 1999. Immediately to the south of the balcony, outside the sliding glass door to bedroom four, and below the top stair, the plan shows a paved area on the upper terrace described as a "patio" (to which I will refer as the "upper terrace patio"). The evidence before me did not identify when the patio was built or when the balcony was modified.
33. The 1999 survey was annexed to the contract pursuant to which Mr Crowe purchased number 33 in April 2003, so it presumably represented an accurate depiction of the property as it then was. Also in evidence (although not produced until late in the hearing itself) was a sales flyer dating from the time of Mr Crowe's purchase. The front page provides a description of the property which includes its basic specifications and accompanying photographs. The back page of the flyer contained a sketch plan depicting three levels of the property (but not the top terrace behind). The flyer has been reproduced below in full:
34. The sketch plan shows that modifications had been made to the internal layout of level six since the initial construction of the house, as depicted in the diagram in the Home Beautiful article ([42] above). The utility room and bedrooms two, three and four had been converted into three rooms: a study and two bedrooms. As a result, the southernmost bedroom, bedroom four (described as bedroom two on the plan), had been expanded northwards. The glass sliding doors on the eastern side had been reduced in extent, resulting in the southern part of the eastern wall of bedroom four being converted into masonry.
35. The sketch plan also combines the balcony and the irregularly shaped upper patio shown on the 1999 survey into a single rectangular area. Whether that represents an oversimplification, or an actual alteration made between 1999 and 2003, is not clear on the evidence.
36. Adjoining areas of number 35 at time of construction of house on number 33: As I have described, the lower terrace patio constructed between the living room and the eastern boundary of number 33 was built on the lower terrace between the front edge and the cliff at the rear. Across the boundary on number 35, the terrace extended eastwards for about ten metres; this was the area later used as the side yard.
37. The upper terrace across the boundary from the patio (or where it was later built) also extended onto number 35. But only for one metre or so. Beyond that the land rose almost sheerly from west to east, forming a natural bastion with one face to the north, about ten metres above the lower terrace, and the other face to the west, about five metres above the upper terrace (see photo at [86] below).
38. Where the upper terrace meets the foot of the bastion, there is a section of brick wall (see photo at [109] below). Moving south, the wall is replaced by a dilapidated paling fence with a chain-link fence in front of it which runs along the eastern side of the upper terrace, thus being located a metre or so on number 35's side of the boundary. Moving further southwards, the two fences come back to the boundary about half-way up the top stair. Thereafter, they run from north to south roughly along the boundary between the top terrace on number 33 and the higher land on number 35 (see the survey at [120] below). The deviation in the fence line creates a narrow tongue of land belonging to number 35 between the boundary and the wall/fence at the foot of the bastion and which appears to have been used as part of number 33's garden (see photos at [111]-[112] below).
39. The brick wall and the paling fence appear to be decades old. The chain-link fence appears to have been erected so as to supplement the paling fence, but the chain-link fence itself also appears to have been in place for many years. It is shown in the 1999 survey, but Mr Lonergan considered that it had probably been erected at or around the time the house on number 33 was built.
40. Grant of lease and conversion of number 35 to Torrens title: There was evidence before me of three separate written agreements between Miss Turkington and Mr Gyngell concerning the side yard area.
41. The first was a licence agreement dated 25 January 1963 ("the 1963 Licence"). The parties were Miss Turkington as Licensor and Mr Gyngell as Licensee. The Licence recited that Mr Gyngell wished to have the use of the land to be licensed "as a playground for his children". Clause 1 provided that he was to have "use and occupation" of: a piece of land having a frontage of 33'5" to Edward Street, Woollahra, by a depth along the land already owned by the Licensee of 28' and a depth along the other side boundary of 17' and a rear line of 32' as shown on the plan hereunder.
42. I will refer to this area of land as the "Licensed Area". It was depicted in a diagram which has been reproduced below:
43. The evidence did not identify precisely where on number 35 the Licensed Area was. I would infer however that the "back fence" referred to was a predecessor of the fence which now exists on the northern side of the top bastion. Reference to Mr Lucas' plan (above at [48]) shows that the length of the eastern boundary between the foot of the lower stair and the landing of the upper stair is 28 feet which accords with the depth of the Licensed Area along the eastern boundary of number 33 in the above diagram.
44. Clauses 2 and 3 provided: 2 The Licensee may erect:- (a) Fences of such design and material as are approved by the Licensor in writing along the side boundaries and along Edward Street, Woollahra --- (b) Children's Swing. Any such erection shall become the property of the Licensor. Otherwise than aforesaid, no erections whatsoever shall be placed upon the subject land --- 3 The Licensee may cultivate the said land in such manner as the Licensee desires PROVIDED that no shrubs or trees which can grow to a greater height than ten feet shall be planted upon the subject land. Any shrubs, trees, plants or grass planted upon the subject land shall become the property of the Licensor.
45. Clause 4 provided: It is hereby expressly agreed that this Agreement does not constitute a Lease or Tenancy of the subject land, but grants a licence only, which may be terminated at any time by giving notice in writing by one party to the other …
46. The next agreement was a memorandum of agreement between Miss Turkington as landlord and Mr Gyngell as tenant dated 30 January 1963 ("the 1963 Lease"). It provided for a month-to-month lease until determined by the tenant giving notice, and at a nominal rent (1 shilling per annum, if demanded). The area the subject of the Lease was identified as: "that piece of land with yard and garden thereto…now in occupation of the tenant".
47. Clause 2 contained the following covenants by the tenant: Tenant's covenants - The tenant for himself and his permitted assigns hereby covenants with the landlord as follows: (1) To pay rent - To pay the said rent if demanded. (2) To keep in repair - To maintain the yard end garden in good repair and condition. (3) To keep garden in order and not to remove trees. To keep the said piece of garden in proper order and not to remove any trees shrubs or bushes without the landlord's previous written consent. (4) Not to assign - Not to assign underlet or part with the possession of the premises of part thereof without the written consent of the landlord.
48. Clause 3 relevantly provided: Provisos - PROVIDED ALWAYS and it expressly agreed as follows: (1) Not determinable by death of either party - This tenancy shall not determine on the death of either party. (2) Not determinable by assignment - This tenancy shall not be determined by the assignment of interest of either party. (3) Determinable on breach of stipulations - The landlord may determine the demise and forthwith re-enter upon the demised premises upon the non-observance by the tenant of any of the stipulations on his part hereinbefore contained. (4) Statutes of limitation not to apply - The non-payment of rent by the tenant for any length of time shall not entitle the tenant to possession of the premises under any statute of limitation. (5) Tenant to yield up possession - Upon the determination of the tenancy the tenant and all persons claiming under him will forthwith yield up possession of the demised premises.
49. The third agreement took the form of a variation of the 1963 Lease. It was dated 30 April 1966 ("1966 Lease").
50. The 1966 Lease converted the 1963 Lease to a fixed term of 99 years from 30 April 1966. Clause 2(4) of the 1963 Lease was reworded as follows: The tenant shall be permitted to improve the garden and yard and such improvements shall include the grassing of the said garden and yard, the provision of paving, decking and such other structures as necessary to keep the garden and yard in proper order.
51. Clause 3(5) was also replaced so as to read as follows: Upon the determination of the tenancy the landlord shall grant the right to the tenant to convert the tenancy to a freehold interest.
52. Copies of the 1963 Lease and the 1966 Lease, as signed by the parties, later came into the possession of Mr Crowe as I will describe. The 1963 Licence, however, did not. The copy in evidence is a conformed copy made by Miss Turkington's solicitors in connection with the application to convert number 35 from Old System to Torrens title as I now describe.
53. The application was dated 12 December 1962, six weeks or so before the Licence was signed in January 1963. In its initial form, it did not disclose that there were any leasehold interests over the land. But for reasons which are not explained in the evidence, the application took more than a year to procced to registration. On 14 February 1964, Miss Turkington signed a supplementary statutory declaration. Paragraph 2 stated that she was in possession of number 35 and there were no tenancies, but in handwriting, words "except Bruce Gyngell with licence agreement, copy herewith" were added. A copy of the 1963 Licence was attached. No reference was made to the 1963 Lease, which had been signed four days after the Licence.
54. A new folio for number 35 was thereafter registered on 26 February. The 1963 Licence would not have been registrable, and because of its indeterminate term, the 1963 Lease might not have been either (see [331] below). In any event, there is nothing to suggest that any attempt was made to register the 1963 Lease or lodge a caveat. Nor, when the 1966 Lease was signed, was it registered.
55. It is unclear why the parties went to the trouble of creating a formal licence, only to replace it with a lease four days later. It is also surprising that the statutory declaration in support of the application referred only to the 1963 Licence and not the 1963 Lease. It is also unclear why the parties went to the trouble of signing a formal lease variation, which would presumably have been registrable, and then not registering it. But there was nothing in the evidence which explains what happened.
56. Development and use of side yard to 2009: Photographic evidence from the Home Beautiful article referred to at [86] below shows that, by 1966, at which time the house on number 33 had been completed, the side yard had also been established. The lower natural terrace abutting the eastern edge of the lower terrace patio on level four had been levelled and grassed over as a lawn. A chain-link fence had been erected on the northern and eastern sides of the yard. Part of the northern section of the fence can be seen in the cover photograph from the Home Beautiful article at [45] above. Some parts of the fence, much overgrown, still remain.
57. It is also common ground that the lower stair and the upper stair date back to Mr Gyngell's day. I will now describe them in more detail.
58. The lower stair is a flight of concrete steps which starts from an external door on the eastern side of the house on level 2 (the entrance lobby level: see the construction plan at [47] above). The stair curves slightly as it rises up to the levelled part of the lower natural terrace (see the survey plan at [103] below). The upper part is therefore on number 35.
59. As built, the lower stair replaced a differently designed external stair in Mr Lucas' plans. Those plans, in their final approved form, showed a more compact spiral stair leading from the external door on level two to the lower terrace patio on level four above (thus contained entirely within the boundary of number 33). This proposed stair can be seen on the construction plans at [47] above.
60. Mr Lonergan referred to this change in his evidence. He noted that the plans contained an annotation that the spiral stair was not included in the original building contract. His inference was that during the construction of the house, Mr Lucas and Mr Gyngell decided not to proceed with the construction of the spiral stair, which would have required demolition work on the sandstone rubble wall, and built the lower stair instead.
61. This inference was not disputed and is consistent with the arrangements between Mr Gyngell and Miss Turkington about the side yard. The construction work for the house would not have begun until after approval was obtained in May 1962, and would not have been completed until after January 1963, when the 1963 Lease was granted. In fact, Mr Gyngell's signature on the 1963 Lease was witnessed by Mr Lucas (as was Mr Gyngell's signature on the 1966 Lease, in April 1966). It may therefore be accepted that the lower stair was built at the same time as, or soon after, the house was built, so as to provide access between it and the side yard.
62. The upper stair leads from the levelled part of the lower terrace back towards the upper terrace, following the curve of the cliff face above the side yard (see the photograph at [108] below). It has a distinctive design. The stairs are mounted on spikes driven into the rock. Each tread is supported by a single piece of metal which is then bent at a right angle and used to support the handrail. The whole of the upper staircase is on number 35. At the top is a concrete landing on the ledge adjacent to the patio, opposite the entrance to bedroom four and below the top stairs (see the photograph at [109] below).
63. In his report, Mr Lonergan expressed the opinion that the upper stair, like the lower stair, dated from the time of construction of the house. This opinion was based on the materials used and on stylistic grounds: in Mr Lonergan's opinion, it was characteristic of Mr Lucas's work. In the course of Mr Lonergan's oral evidence he went on to say that the staircase had probably been built in order to aid construction.
64. Again, the fact that the stair was built on land which did not belong to number 33 can be explained by the existence of the 1963 Lease and the 1966 Lease. In the end, there was no dispute that the stair was the work of Mr Lucas, or that it had been built at the time the house was built on number 33 or shortly afterwards. I do not think it is possible to be certain that it was built to help with the construction of the house. But whether it was or not does not matter for present purposes.
65. Reproduced below is a photograph from the Home Beautiful article which appeared in Mr Lonergan's report. The lawn on the lower terrace can be seen from inside the living room, looking out past the lower terrace patio (with the balcony/pergola above). On the right-hand side, Mr Lonergan has indicated with a red oval the location of the upper stair, which is obscured by foliage. The top of the lower stair is out of the shot, to the left.
66. The photograph was captioned (emphasis added): ELEVATED GARDEN shown here is on a narrow rock ledge just below the top of the quarry face. The Gyngells' property ends at the far edge of this terrace outside their living room, but they leased this strip from their neighbour and made a safe, convenient children's play area.
67. Later, a pavement made from bricks or pavers replaced the lawn. This work was done before Mr Crowe bought number 33 in 2003.
68. Works by Mr Crowe in side yard: As already noted, Mr Crowe undertook significant unapproved renovation works on the house in 2009/2010. According to Mr Crowe, he himself undertook the works with the help of a carpenter and a bricklayer. For the purposes of this judgment, the important works were as follows.
69. First, Mr Crowe extended part of the eastern side of the house out to the boundary of number 33. The living room on level four was expanded to enclose the original lower terrace patio and, above, the study and bedroom which had been created in the pre-2003 remodelling of level six (see [55] above) were extended to enclose the balcony/pergola structure. The new eastern face of the house was just within the boundary line, but at roof level the extension resulted in an overhang which projected across the boundary by about 0.8 metres.
70. In evidence are plans prepared for further proposed works by Mr Crowe in 2020. The plans depict the existing state of the eastern part of the house and the side yard (which were not affected by the further proposed works) and thus reflect the alterations undertaken by Mr Crowe in 2009-2010.
71. Reproduced below are plans of levels three and four (on the left) and levels five and six of the house (on the right). They show that in 2009-2010 Mr Crowe cut back the cliff face at the southern end of the lower terrace patio on level four and built walls to support the extensions above. At the northern end of the extension, a space surrounded by the house on three sides, referred to at one point in the hearing as a "lightwell", was created.
72. Reproduced below is the east elevation. On level four, the new supporting wall, clad partially in brick and partially in timber, can be seen. Above it, on level six, are glass sliding doors for the bedrooms created by the extension, with, to the left, the glass sliding door and brick wall created due to the pre-2003 remodelling of bedroom four (see [55] above; this does not appear to have been affected by Mr Crowe's works).
73. Beyond the eastern face of the extensions to the house, Mr Crowe constructed a new concrete slab and balcony, supported by timber columns, adjacent to where the original lower terrace patio and balcony/pergola had been. The slab and the balcony projected across the boundary into the side yard by about two metres. Beyond the new concrete slab, Mr Crowe built a timber deck on the paved area of the lower terrace. The slab, balcony and deck (as refurbished in 2019: see below at [101]) are also depicted in the plans.
74. The plans and the elevation also show that, behind the house, the top terrace was subdivided into two parts, separated by a wall and a flight of steps on the western boundary. The part closer to the house was described in the evidence as a "courtyard". The part behind, adjoining the southern boundary, is an area of garden (described in the plan as "landscape").
75. In passing, it may be noted that the plan appears to show the top stair as being about two metres wide, and extending onto number 35. This is not consistent with the photographic evidence (see [111]-[112] below) but it may have been intended to depict both the stair and the adjacent garden beds, which do extend onto number 35.
76. As already noted, there is a question about precisely when Mr Crowe undertook these works. The evidence at trial included three aerial photographs taken between November 2009 and March 2010. The photographs are reproduced below.
77. In the first photograph, no extension works appear to have been undertaken and the original roof is intact. There is no sign of any work being undertaken in the side yard, but the area is in shadow and it is not possible to be sure.
78. In the second photograph, construction work on the extension is underway. The surface of the side yard is clearly visible and it appears to be being used as a work area; the ground has been cleared, although it is not possible to tell whether the pavers in the area have been removed. Clearly the deck has not yet been constructed. The top terrace also appears to have been partially cleared.
79. In the third photograph, the extension and the roof above it have been completed. The side yard is again in shadow and it is not possible to tell what has happened with the surface; the deck may or may not have been installed by this point.
80. I will return to the timing question below. For present purposes, it is enough to say that, according to Mr Crowe, the works had been completed by mid-2010 at the latest. After that, it seems that no further significant works were undertaken in the side yard until Mr Crowe replaced the timber surface of the deck with a timber lookalike surface in 2019. As already noted, it was this work which came to the Church Trust's attention and resulted, ultimately, in the present proceedings. Later, in 2020, Mr Crowe replaced the wooden treads of the upper stair with aluminium treads.
81. Current state of property: In this section of the judgment, I set out some of the pictorial evidence so as to show the current state of the property and the improvements I have earlier described.
82. Reproduced below is a plan of number 33 and its adjoining properties drawn from a survey undertaken in December 2020. The lower, upper and top stairs are marked "S". The concrete slab, described as a "patio", is shown at ground level of the lower terrace, along with the deck. Above it can be seen the encroaching roofline.
83. Reproduced below is a photograph from Mr Lonergan's report, taken from inside the house as it now is, looking east. The photograph is taken from roughly the same place as the Home Beautiful photograph reproduced earlier. Visible in the photograph are the extension to the living room, the concrete slab under the balcony behind, and the deck behind that. Again, Mr Lonergan has indicated with an oval the location of the upper stair, which remains concealed by foliage.
84. The below photo is taken from the deck in the side yard looking west towards the house on number 33. In the centre and on the left are the extensions built by Mr Crowe on the eastern side of level four and level six, with the concrete slab and the balcony extending into number 35. To the right, the lower stair is below the deck level, leading down to the external door on level two of the house.
85. Reproduced below is a photograph looking down at the bottom of the lower stair and the external door on level two of the house. The photograph shows the external door which gives access to the stair from the house. On the left is the sandstone rubble wall which apparently predated the house (see [39] above). Above the wall is a brick wall constructed by Mr Crowe as part of the extension to enclose the former lower terrace patio.
86. The below photograph is taken from within the house on level two, looking eastwards, up the lower stair through the external doorway. On the right, the face of the rubble wall is only just visible. The stair curves to the right gradually as it ascends to the deck which can be seen at the top of the photograph.
87. Below is a photograph of the upper stair looking roughly southwest. The stair curves around the cliff behind the lower terrace, terminating with the landing on number 35, with the southeastern corner of the extensions built by Mr Crowe adjacent. Behind the landing, the southernmost part of level six can be seen. The upper terrace patio is not visible, owing to the angle.
88. Reproduced below is a photograph looking northeast down the upper stair from the upper terrace. At the bottom right of the photograph, part of the concrete landing can be seen. To the left of the stair can be seen the southeastern corner of the extension built by Mr Crowe, the balcony projecting into number 35 and the deck. To the right of the landing is the terminus of the old stone wall on number 35 behind which, out of shot, is the part of the cliff forming the western wall of the natural bastion.
89. The below photograph captures the view looking down from the northwestern corner of the natural bastion on number 35, above the old stone wall shown in the previous photograph (obscured by foliage). At the bottom left is the landing at the top of the upper stair (partly obscured by foliage). Behind the upper stair are the extensions to the house on number 33, with the balcony and the concrete slab below extending across the boundary.
90. Reproduced below is a photograph from the upper terrace patio looking south, towards the top terrace. In the centre, the top stair leads up to the "courtyard" behind the house. To the right, the rear of the house reflects the original building envelope. To the left of the stair, a section of wire fencing runs approximately down the boundary between number 33 and number 35 and effectively serves as a handrail for the top steps (better displayed in the below photograph at [112]). Behind it is the chain-link fence (with the paling fence behind it) which diverges in a north eastward direction from the boundary line.
91. The photograph below looks northwards down the top stair. On the left is the roof over the southernmost part of the house, reflecting the original building envelope. At the foot of the steps, the upper terrace patio. Behind it, a door gives access to the extension of the house with the roof overhanging the boundary with number 35. To the right of the stair is the end of the metal handrailing fence, marking the approximate boundary line between number 33 and number 35. The lowest part of the chain-link and paling fences stand on number 35.
92. Lastly, the photograph reproduced below, which looks east from the top stair, shows the chain-link and the paling fences with part of the retirement village on the higher land behind.
93. Discussions between Mr Crowe and the Church Trust, 2009-2010: Between June 2009 and March 2010, discussions took place between Mr Crowe and executives of the Development and Asset Management Division of Uniting Care Ageing (described as a "service arm" of the Church Trust) for the purchase by Mr Crowe of the side yard land (or, at least, a portion of it). Initially, the discussions also involved a second potential purchaser, Mr Pemberton. He was the owner of number 37. Mr Pemberton appears to have dropped out of the discussions in February 2010 (see [137] below).
94. Mr Chris Lawlor was the Director of the Development and Asset Management Division. When the discussions began, Mr Dennis Fernandez was the Executive Manager, reporting to Mr Lawlor. In March 2010, Mr Fernandez was replaced as Executive Manager by Mr Drago Chikitch.
95. The documentary evidence begins with an email sent by Mr Crowe to Mr Lawlor at 5:52 pm on 16 June 2009 following a meeting they had on the afternoon of the same day. The email had the subject "Potential purchase of Edward Street vacant land" and stated: Further to our meeting this pm, please be aware that we have been maintaining, gardening and cleaning the land for many years without assistance from neighbours or anyone else. My understanding of your process is such that you will: 1. Research the terms of the will/bequeath to ensure the UCA [United Care Ageing] is able to sell the land, and that this answer will take up to 2 weeks from now. 2. Obtain a surveyors plan, and that this will take up to 2 weeks from now to be obtained. 3. Write to me requesting whether I am interested in purchasing the property. I can advise you now that I am interested and am willing to agree to jointly appoint Egans National Valuers now … and abide by their valuation. Please let me know whether you would like me to prepare a draft letter of joint appointment and I can email it to you for review/input to commence the valuation process. Please be aware that I have another proposed venture which will require a final decision on my financial commitment by Monday 6th July. Beyond that time I am unable at present to firmly commit to purchasing UCA's vacant land adjoining my home in Edward St. I appreciate that there are some things that UCA needs to do, and I want you to be aware that I am a willing purchaser - under an agreed valuation process using Egans - but I do need some understanding of the direction we are both heading and our mutual commitment in view of my other circumstances and the 6th July requirement.
96. On 26 June, Mr Lawlor sent a letter to Mr Crowe which stated: As you may be aware the Uniting Church owns a vacant parcel of land adjoining your property being part or all of 35 Edward Street. UnitingCare Ageing … is currently considering the future use of the land and whether it might be sold. Initially we are seeking advice on whether as an adjoining land owner you would be interested in a possible purchase of the vacant section of land. Should this be the case then we propose to seek formal Church approval to sell the land and enter into a sales/tender process with any interested adjoining property owners. In the first instance it would be appreciated that if you are interested whether this interest could be confirmed within 10 working days from the date of this letter. Subject to outcome of this initial step we will prepare appropriate documentation (e.g. surveys, titles searches) to allow a more detailed response to this invitation.
97. Mr Crowe replied to this letter on 7 July: The purpose of this letter is to confirm my interest in a possible purchase of the vacant section of land adjoining my property at 33 Edward Street, Woollahra. For many years I have been solely maintaining the said vacant section of land including gardening, cleaning, cutting, pruning and such maintenance.
98. Shortly thereafter, on 14 July, Mr Lawlor also sent a letter, in identical terms to that which was sent to Mr Crowe on 26 June, to Mr Pemberton.
99. Next are two identical letters sent to Mr Crowe and Mr Pemberton from Mr Lawler on 23 September. Attached to each letter was a survey plan which proposed a subdivision of number 35 so as to create a 226m2 area (referred to as "Lot 202") covering the Edward Street frontage, including the side yard:
100. Mr Lawlor's letter stated: To initiate the next step in the process, I request that you reconfirm your interest within 10 working days from the date of this letter and on this basis that you still wish to proceed with a purchase subject on purchase price and terms within 20 working days of this letter. The process for potential disposal of the subject property will entail the following: 1. UnitingCare Ageing receiving an offer to purchase the subject property with a dollar amount and terms. 2. UnitingCare Ageing selecting a preferred purchaser based on price and terms. 3. Notifying all parties. 4. Negotiating with the preferred purchaser. 5. Obtaining internal approvals based on negotiations. 6. Preparation, negotiation and execution of Contract of Sale with special conditions e.g. Subject to Council Approval and Disbursements. 7. Finalise plan of proposed subdivision, preparation of Statement of Environmental Effects and Development Application submission to Woollahra Council. 8. Preparation of a subdivision plan suitable for lodgement and registration at Department of Lands. In the interim, if you are still interested in the subject property, the attached proposed plan of subdivision should be sufficient for you to use to obtain your own independent valuation. UnitingCare Ageing reserves the right to not accept the highest offer and will not be liable for any losses suffered by a prospective purchaser. Any sale will be subject to Board approvals.
101. Mr Crowe responded by facsimile on 22 October addressed to Mr Fernandez: I re-confirm my interest in purchasing the land. I have appointed a Valuation Firm to assist me in ascertaining its value. I am expecting to receive my Valuation Report shortly and will then respond to you with the proposed purchase terms. I have been told that the Report will be finalise within the next 2 weeks or so and I will respond to you when I receive it.
102. On 10 November, Mr Crowe sent another facsimile to Mr Fernandez and Mr Lawlor, which stated: … the valuer has requested that I confirm with you the proposed zoning of the site. As that information does not appear to be available, would you please advise me of the zoning of the site so I may forward that information to the valuer to enable their report to be finalised. Whilst I am awaiting the Valuation Report and your input above, and having regard to what is fair and reasonable given that the Owners of 33 Edward Street have exclusively used and cared for the said site/land for over 50 years, would you please consider and advise me whether you would agree to sell me half of the land and the remaining half to the Owners of 37 Edward Street at market value? In the event that the Owners of 37 Edward Street do not wish to purchase half of the land, I am purchase [sic] that remaining half from you at market price.
103. There was no response from the Church Trust to this request in evidence. Instead, on 17 December, Mr Crowe sent a further letter to Mr Fernandez and Mr Lawlor setting out, at length, his case as prospective purchaser.
104. In the introduction of the letter, Mr Crowe stated: From the previous site visits we have conducted together, you will be aware no.35 is, and has been, a critical "part and parcel" of my home since it was built in 1961, and that no. 35 is very steep and inaccessible other than via my home at no.33. The only practicable access to no.35 is from my home, and this has been the case for virtually 50 years.
105. Under the proceeding heading "Summary", it is stated (emphasis original): I am a willing purchaser and I accept your offer to purchase all or a portion of no.35. I am willing to pay market price for the land. I understand you have obtained an independent valuation: I have instructed Egans National Valuers to perform a valuation for me. My understanding is that the Valuers have had some difficulties in ascertaining the value. Be that as it may, I am willing to purchase the property on a basis that is fair for both you and me. As a suggestion, the market price at which we transact (you sell and I buy) for the land might be best ascertained by comparing our 2 valuations - on a fully transparent basis - and taking an average or mid point, or some other method so as to ensure we mutual outcome. I am willing to pay a market price, whatever that might be. I also feel there are special circumstances, built up over 50 years, in relation to no.35's relationship to my home at no. 33 that warrant consideration in relation to who purchases the land.
106. The rest of the letter was structured as eight separate points, under the heading "Further Information".
107. The first point was headed, "No. 35's connection to my home at no.33" and included the following: My home's living area opens onto your land and relies upon the easterly aspect for its natural outlook, sunlight and source of fresh air to enable the cross-flow ventilation design of the home to operate. On the upstairs level, a balcony runs along the full length of my home on the eastern side and all the upstairs rooms (including bedrooms, bathroom and study) rely upon the easterly aspect over no.35 for their natural outlook, sunlight and cross-flow ventilation. … When I purchased my home in 2003, negotiations were conducted and completed on no.35. Indeed, the property brochure referred to the area as the home's "outdoor garden area" (in effect). Garden lights have been installed on no.35 by previous owners of no.33 and run off the electrical system of no.33. For all intents and purposes, no. 35 has been part and parcel of my home at no.33 for close to 50 years.
108. Mr Crowe's description of the sales flyer from April 2003 (a copy of which was not included in the letter) is rather misleading. Although the flyer did refer to an "informal living area with patio overlooking [sic] the side tropical garden" the property, as depicted on the sketch plan (reproduced at [54] above), did not include the side yard. This was confirmed by the rectangular land dimensions given on the front page of the flyer.
109. The second point in the letter was headed "Architectural Significance" and addressed heritage considerations. The house on number 33 was said to "retain the original design principles of Mr Lucas". Mr Crowe asserted that the connection intended by Mr Lucas, in his design, between the house and the "natural landscape, environment and bushland" in the side yard was "one of the foundational blueprints for the genre of 'Sydney School of Design' Architecture" and therefore ought to be preserved. This point was developed at some length by Mr Crowe who included references to academic material on Mr Lucas' contribution to Australian architecture including his role in establishing the "Sydney School".
110. The third point, "No. 33's lease relating to no. 35", is only one sentence long: It has recently come to my hand that a lease arrangement exists between no. 33 and no. 35. The 1963 Lease between Miss Turkington and Mr Gyngell (see [67] above) was attached.
111. As part of his fourth point, "Other Considerations", Mr Crowe stated that, without the side yard, he and his wife "will be unable to raise our family with security in our existing bush environment and will relocate from the area".
112. The fifth and sixth points were: No. 33's contribution to no. 35 No. 33 has solely gardened and maintained the land at no. 35. Each week I garden and maintain the land. Each autumn and spring I have done a "spring clean" and hired skip bins and filled them with the garden waste and clippings from the plantings on no. 35. Recently I killed a snake on no.35 (I have a witness available if you need to verify this - I did take a photo but am currently unable to locate its whereabouts). My plan for the land at no.35 My desire is - to purchase no.35 and gradually improve it as a garden and outdoor area for my home and family, and reduce the fire risks for the surrounding homes/residents. I would like to improve the fencing and build a retaining wall. It will be a passive asset and my intention is to create an improved living environment for the residents.
113. Mr Crowe's seventh point, "No. 37's position (the Pembertons)" is captured by the following excerpt: Should the Pembertons purchase no. 35 the additional land will offer them the opportunity to succeed in the DA for their Apartment Block and local residents will be outraged and an unpleasant time can be expected to ensue from the residents. That would be an unfortunate outcome …To date I have not mentioned this matter to any of the residents.
114. The final point referred to Mr Crowe's use of the road reserve land beyond the northern boundary of number 35 as a driveway and the risk that he might lose access to this land if the Church Trust were to sell the side yard to anyone else.
115. In the conclusion of the letter, Mr Crowe stated: If you do not wish to sell the land, in the alternative it may be appropriate to review our arrangements for the land, and this may involve a sale to me of some of the land. My preference, though, is to purchase the land. Recent events such as the snake highlight the fact, in my mind, that we should proceed together to transact on this land on a basis that ensures fair market value is paid and both you and I are satisfied parties to the transaction.
116. There is no evidence of any written response from the Church Trust to Mr Crowe's letter. The next record of communication between the parties in evidence is a file note by Mr Crowe of a phone call he had with Mr Fernandez on 4 February. The note states: Valuation came in at $1 million. Pemberton not interested - their valuation is about 20% below their (i.e. Church's) valuation. Denis [Mr Fernandez] is getting some legal advice on the lease & it's due next week. The site proposed is 226sqm [therefore] = $4,425 psqm No.4 View Street - Land 6.095 x 39.535 = 241sqm
117. The advice to which Mr Fernandez referred was being provided by Ms Deanna Jenkins, solicitor, of Slade Manwaring Law. In fact, Ms Jenkins' initial letter of advice was dated 1 February, three days before the conversation between Mr Fernandez and Mr Crowe. Presumably the letter was not received, or did not come to Mr Fernandez' attention, until after that conversation.
118. In her letter, Ms Jenkins referred to having received documents (evidently including the copy of the 1963 Lease provided by Mr Crowe) from Mr Fernandez. She does not appear to have conducted any investigations of her own. She stated: Based upon the information that you have provided, the owner of 33 Edward Street is currently complying with the Lease, ie it is maintaining the garden. An important consideration as to whether this Lease is valid, is whether there is performance of each party's obligations under the Lease. It appears as though the owner of 33 Edward Street is performing its obligations in accordance with the Lease. It is therefore arguable that the Lease is presently valid. Should you decide to subdivide lot 1 by consolidating it into a larger lot forming part of the Lough-Neagh Aged Care Facility, and a separate lot for the area that forms the garden, the Lease may still be valid. As the Tenant has an interest in the property, it would be prudent to advise the owner of the number 33 of your intentions to subdivide prior to doing so. It may also be necessary to formally document the change in the property. Upon the sale of 35 Edward Street, the Lease would need to be disclosed in the Contract for Sale as it is an encumbrance upon the land, and the purchaser is entitled to have it disclosed. Should the land be subdivided and then sold to the owner of 33 Edward Street, the Lease may automatically terminate as the rights of the Tenant and their rights as the new owner of number of 35 Edward Street would merge. This, however, may depend on how the purchaser elects to purchase the property.
119. The next record of a communication between the parties is a handwritten note by Mr Crowe which bears the date 30 March. Attached to the note is a card giving the contact details of Mr Fernandez' new employer, so it presumably records a face-to-face meeting with Mr Fernandez (and perhaps others).
120. The note includes the text, "valuation", and the vertical flowchart reproduced below: Rubberstamp Uniting Church Property Trust Board for approval to - lease - buy

Negotiate Drago [Chikitch, replacing Mr Fernandez] - Property Exec 11x2 Br Bedrooms = 2000sqm Fit 12 Units Land $6 Mill - Per unit site value is $500k

1. The documentary evidence of discussions between Mr Crowe and the representatives of the Church Trust ends at this point. But internal consideration continued within the Church Trust organisation.
2. On 16 April, Ms Jenkins, responding to an email from Mr Chikitch (which is not in evidence), wrote: I have set out responses to your three questions below:  Section 53 of the Real Property Act provides that leases for a term exceeding three (3) years must be registered. The lease affecting this property provides that the lease commenced on 30 January 1963, from month to month, "until determined at the end of the first month or any subsequent month". This means that the lease term was for one month, and thereafter became what is called a periodical tenancy which was able to be determined on the giving of one month's notice by either party. As the lease term is less than the three (3) years required by the Real Property Act, registration was not required. In addition, this lease relates to residential property, and generally residential leases are not required to be registered.  Clause 3 of the lease provides as follows: o Not determinable by death of either party - this tenancy shall not determine on the death of either party; o Not determinable by assignment - this tenancy shall not be determined by the assignment of interest of either party. This means that the death or sale of the property did not determine or terminate the lease.  The lease can be terminated by the giving of one month's notice in writing by either party.
3. On 2 June, Ms Jenkins wrote again to Mr Chikitch, in response to a request for advice on "whether there [was] a way to terminate" the 1963 Lease. She stated: I advise that the lease over this property is a tenancy at will. A tenancy at will is a lease that can be terminated by either party on the giving of notice that is appropriate in the circumstances of the lease. It can arise when there is no clear fixed term for the lease or a fixed term for the lease has expired, and there is no adequate holding over provision in the lease and the tenant remains in possession. The lease over the above property has no fixed term clearly set out in the lease, other than the requirement that it could not be terminated until the end of the first month, there is no adequate holding over clause, and the tenant has remained in possession. The Conveyancing Act provides that if there is a tenancy, with no agreement as to it duration, then such tenancy shall be a tenancy determinable at the will of either party by the giving of one month's notice. This would entitle you to terminate the lease by providing the tenant with one month's notice. One of the issues regarding the termination of this lease is that it provides that only the tenant may terminate the lease. However, there is case law that sets out the principle that if any lease purports to exclude the Lessor from being able to terminate the lease, that clause is repugnant to the nature of the lease and is therefore void. This means that the provision that entitles only the tenant to terminate the lease may be unenforceable.
4. Ms Jenkins' advice about the 1963 Lease was considered at a meeting of the Church Trust's Property and Finance Board Sub Committee on 8 June. The minutes record that the Committee concluded that "[t]he termination of the agreement will provide certainty over the development potential of the site, which will enhance its potential for sale to a third party, which will then enhance its sale value" and recommended termination accordingly.
5. The Church Trust's internal documentary evidence ceases at this point. It seems that the recommendation to terminate the "agreement" was never acted on, and the matter was left to rest.
6. Events from 2019 onwards: Following the replacement of the deck by Mr Crowe in April 2019 or thereabouts, the Church Trust resumed its communications with him. The first communication was a letter dated 4 July 2019, which stated: It has been brought to our attention that recent building works associated with your property have encroached on our property. I have attached a copy of a survey report … which has identified three encroachments including a timber deck, a timber balcony and metal roofing into the Church's property. The Church would like to offer you an opportunity to remove these encroachments from the Church's land prior to it taking formal legal action to restore its property rights. Please provide a timetable for the removal of the encroachments.
7. The survey plan which was attached included the following diagram:
8. There is no reply to this letter from Mr Crowe, or any lawyers acting on his behalf, in the evidence. Mr Crowe's evidence is that he did not receive the letter, at least at the time. That is rather convenient, but there was no affirmative evidence that he did receive it. Nor does there appear to have been any follow-up from the Church Trust. Instead, the Trust took the matter up with Woollahra Council.
9. In October 2019, the Church Trust made a formal written complaint to the Council about the construction of the deck and the encroaching structures in the side yard. Despite a follow-up from the Trust, there was no response. The Trust's current solicitors, Maddocks, were then engaged. They sent a further follow-up to the Council in March 2020.
10. The Council then took action. As a result of their investigations, its compliance officers learned that, as well as having undertaken the works in the side yard, Mr Crowe was undertaking extensive renovation works at the front of his house without having obtained any approval for those works either. On 21 May, the Council issued a development control order requiring Mr Crowe to stop work on these unauthorised works (the order applied to the side yard works as well as the renovation works, but the side yard works had, of course, been completed long before).
11. In evidence is a file note which records an interview of Mr Crowe by a compliance officer of the Council four days later, on 25 May. The note records that Mr Crowe acknowledged that the most recent development consent for number 33 was the consent obtained by Mr Gyngell in 1962. When Mr Crowe was asked to explain why he had undertaken the works the subject of the order, he gave the following response: Mr Crowe had acknowledged that the … works were undertaken without consent hence being considered illegal works. Further, he admitted to instructing all works and justified his actions by stating the following: All works were maintenance works due to the state of the building; The works were sympathetic to the original build; The original build was in a very poor state due to [low] budget construction and the natural materials utilised: … Mr Crowe had aimed to undertake all works like for like as he is aware that the property is located within a HCA [Heritage Conservation Area]; … Mr Crowe has acknowledged that his building is encroaching onto the adjacent property which is owned by Uniting; Stated that the balcony/deck/terrace on the side of his building had encroached the adjacent property prior to his purchase; He had replaced the timber joists [for the deck] with steel circa 18 months ago to achieve greater support for the structure; There was a lease agreement in place when he purchased his property permitting the encroachment; … Mr Crowe did not inform Council on his proposal in remedying the works in accordance with the required procedures i.e. Development Application nor Building Information Certificate.
12. In telling the Council compliance officer that the "balcony/deck/terrace … had encroached" on number 35 at the time of his purchase of number 33, Mr Crowe was not being accurate. The 1999 survey ([52] above) shows that the western edge of the balcony/pergola structure encroached into the airspace, but the encroachment was minuscule, and there is no evidence that Mr Crowe was ever conscious of it. The lower patio (which presumably is what Mr Crowe meant by the "terrace") did not encroach at all, and the deck had not yet been built.
13. Mr Crowe's statement that when he brought the property there had been a lease agreement which "permitted the encroachment" was also misleading. In fact, Mr Crowe had been quite unaware of the existence of the 1963 and 1966 Leases when he purchased number 33; he did not learn of their existence until much later. And neither Lease said anything about encroachments, no doubt because at the time they were signed no encroachment of any substance existed or was contemplated.
14. On 16 June 2020, the Council issued a development-without-consent letter to Mr Crowe. The letter identified certain works as "being undertaken" without development consent. The works included the renovation works at the front of the house and also the "construction of a terrace to the eastern side of [number 33] and onto [number 35]". After referring to provisions of the relevant planning legislation, the letter went on (emphasis original): Direction to cease illegal development Council requires you to explain what action you will take to remedy the above breaches. Council will take action to prosecute any breach and/or restrain any ongoing breach by interlocutory injunction where it is not satisfied that immediate action is being taken to remedy this matter. WARNING - Failure to cease illegal works and/or use from the dated of this notice may result in Council seeking a penalty and a further daily penalty for each and every day that the offence continues. A penalty notice may also be served upon a person if it appears that the person has committed an offence under this Act, being an offence prescribed by the regulations. Current Fines of up to $6000.00 per offence may apply. Representation may be made to Council Prior to giving effect to the provisions of Act, Council requests you to show cause in writing why legal proceeding or penalty infringement notices should not be instituted against you for the above breach(es) of the Act. Should you wish to make representations they should be made by you, your solicitor, barrister or agent in writing to [the Council's designated compliance officer] within SEVEN (7) DAYS of the date of this letter.
15. In late November 2020, direct communications between the Church Trust and Mr Crowe resumed. Maddocks sent a letter to Mr Crowe referring to the Church Trust's unanswered letter of July 2019 and demanding removal of the deck and the encroaching structures "as soon as possible". On 7 December, Holding Redlich, who had been engaged to act on behalf of Mr Crowe, acknowledged receipt of Maddocks' letter and indicated that they would provide a "substantiative response" in "late January or February 2021".
16. The response was eventually provided to Maddocks several months later, in May 2021. The letter itself was not in evidence, but it seems from Maddocks' response the following year (see [163] below) that it asserted a claim for adverse possession and a claim for a compulsory easement under CA s 88K.
17. In August 2021, there having seemingly been no reply from Maddocks, Mr Crowe caused a caveat to be registered on the title of number 35. The "estate or interest' claimed by Mr Crowe was: a proprietary, or equitable, interest in part of [number 35], … identified as the hatched area marked "(A)" in Annexure B.
18. Annexure B has been reproduced below:
19. In the annexure setting out the facts upon which his claim was based, Mr Crowe relied upon two bases for claiming the alleged interest. One was adverse possession, based on alleged exclusive and uninterrupted possession by Mr Crowe and his predecessors going back at least until 1966. The other was an equitable estoppel based on alleged exclusive and undisturbed occupation, coupled with the undertaking of improvements, over the same period. There was no reference to the 1963 Lease (or the 1966 Lease).
20. Meanwhile, Mr Crowe had lodged a development application which sought approval for the renovation works identified by the Council in its stop-work order and development-without-consent letter. This application became the subject of Land and Environment Court ("LEC") proceedings. In late September, approval for the renovation works was given by the LEC: Crowe v Woollahra Municipal Council [2021] NSWLEC 1659.
21. The approval did not extend to the works previously undertaken in the side yard (see condition A.6). There is however no evidence of the Council having taken any further enforcement action on the development-without-consent letter so far as that letter applies to those works.
22. In May 2022, Maddocks belatedly responded to Holding Redlich's letter of May the previous year and the subsequent lodgement of Mr Crowe's caveat. Maddocks stated that no adverse possession claim was possible, among other reasons because no such claim could be made to a part only of number 35 (that appears to be accepted; no such claim has been pursued on behalf of Mr Crowe). Maddocks also rejected the claim for a s 88K easement and enclosed a lapsing notice on the caveat.
23. Thereafter, correspondence continued but the Church Trust's position was that it was not prepared to grant a lease or license to Mr Crowe, and required the removal of the deck and the encroaching structures, which was unacceptable to Mr Crowe. On the evidence before me, no application was made to extend the caveat and presumably it lapsed in late May, in accordance with the lapsing notice. As already mentioned, the proceedings were eventually commenced in October.

Testimony of Mr Crowe

1. Three affidavits from Mr Crowe were read at the hearing. In summarising these affidavits, I will refer to them in the context of the development of Mr Crowe's pleaded case prior to the trial.
2. First version of Mr Crowe's cross-claim (19 December 2022): Mr Crowe's initial defence (filed on his behalf by Holding Redlich) responded to the claim of trespass by alleging only that "the use of the Side Yard by [the owners of] 33 Edward Street" had continued "to the knowledge of" the Church Trust "since the house on 33 Edward Street was constructed". Similarly, Mr Crowe's initial cross-claim only sought relief under EBA s 3 and CA s 88K. The grounds identified in the statement of cross-claim for the grant of this relief were confined to alleged inconvenience and hardship, and prior use of the side yard by Mr Crowe and his predecessors in title. Neither the 1963 Lease nor the 1966 Lease was mentioned in either pleading.
3. First affidavit (24 July 2023): Mr Crowe deposed that an on-site auction for the sale of number 33 took place in April 2003. The property was passed in, and negotiations then took place between Mr Crowe and the vendor's agent about the price. Those negotiations took place while the parties were standing in the side yard. Agreement was reached on a price of $1.28 million and copies of the sale contract were then completed, signed and exchanged. The sale was completed four months later, in July.
4. Mr Crowe deposed that, upon arrival at the auction, he was provided with a sales flyer. He annexed to his affidavit a cropped copy of the first page of the flyer, which he had annotated with the year and partially redacted. The annexure is reproduced below:
5. As presented, the annexure included the reference to the property "overlooking the side tropical garden", but did not include the site diagrams which depicted it as rectangular. The rectangular dimensions shown on the original flyer were also redacted.
6. The affidavit went on to provide a description and history of the land, the side yard, and the house on number 33. In dealing with the history of the house, Mr Crowe annexed a copy of the Home Beautiful article, noting the reference in the article to Mr Gyngell having obtained a lease of the side yard (see [87] above). He then annexed copies of the 1963 Lease and the 1966 Lease describing them collectively as "what I consider may be that lease, including as amended in April 1966". The affidavit did not say how or when he had obtained these documents.
7. The affidavit described the "improvements" Mr Crowe "installed" in the side yard "around September 2009" as: (a) Concrete slab covering part of the ground of the Side-Yard; (b) A timber deck covering that concrete slab; (c) A timber balcony, which replaced and marginally extended the timber balcony which was rotting, that was there when I started living in 33 Edward; (d) Metal roofing covering that timber balcony, which roofing replaced and marginally extended the metal roofing that was there when I started living in 33 Edward; and (e) Replaced the garden lighting.
8. Mr Crowe deposed: [91] At the time I arranged these improvements to be constructed, I never thought or knew that the land on which they subsisted was part of 35 Edward. I did not think this land belonged to 35 Edward because I had always had exclusive access and use of the Side-Yard.
9. Mr Crowe then recounted a conversation that he had with Mr Pemberton "[in] or around 2009" (emphasis added): [96] At that time we had a conversation in words to the following effect: [Mr Pemberton]: "I want to buy 35 Edward or part of it. 35 Edward includes the yard at the side of your house. That is part of 35 Edward's land". [Mr Crowe]: "Really? I thought that was part of my land. I did not know that". [97] I was surprised as this was the first time I considered that the Side-Yard was not part of 33 Edward. [98] Following this conversation, I wanted to acquire the Side-Yard so I could continue using the Side-Yard as part of 33 Edward.
10. According to the affidavit, it was after the conversation with Mr Pemberton that Mr Crowe contacted Mr Fernandez by telephone to express his interest in acquiring the side yard from the Church Trust. This initial communication led to the meeting in the side yard between Mr Crowe and Mr Lawlor (see [116] above). Mr Crowe gave evidence of the following discussion taking place during the meeting: [Mr Lawlor]: I have never been down here before, but this area is nice! [Mr Crowe]: It is, isn't it! I use it every day as part of my house. I have also maintained and improved it, at my expense, since I purchased the property with my ex-wife. [Mr Lawlor]: Well, you've done a good job. [Mr Crowe]: Thanks. I'm looking to purchase the Side-Yard from the Uniting Church. It makes sense given that I'm the only one that can use it. [Mr Lawlor]: I'm happy to explore this option with you. At first, it will involve surveying the land, and then obtaining a valuation so we can estimate how much that portion of land will be worth. [Mr Crowe]: That sounds like a good idea. I'll send you an email later so we can progress this.
11. Mr Crowe then attached copies of his ensuing correspondence with Mr Lawlor and Mr Fernandez ([116]-[136] above). In describing that correspondence, he emphasised his willingness to buy the side yard. He said nothing about the reference to the 1963 Lease in his letter of 17 December 2009.
12. Mr Crowe continued by deposing that, in response to his correspondence, he received a phone call from Mr Fernandez "[in] around February 2010". Mr Crowe's version of the conversation was: [Mr Fernandez] informed me the Uniting Church would consider selling the Side Yard to me for $1 million. Also, in the conversation, Mr Fernandez said he was leaving the Uniting Church but that he would hand over the matter to someone else who would then contact me.
13. This phone call was the last communication referred to in the affidavit between Mr Crowe and representatives of the Church Trust in 2010. According to Mr Crowe, he "did not hear back from any representative of the Uniting Church until 2020".
14. There was an obvious difficulty with the sequence of events in 2009 described in the affidavit. Mr Crowe's email to Mr Lawlor ([116] above) fixes the date of their meeting in the side yard as June 2009. The conversation with Mr Pemberton in which Mr Crowe said that he learned for the first time that the side yard did not belong to him must have taken place before that. Mr Crowe therefore cannot possibly have believed at the time he undertook the works in the side yard that he owned it, if those works were undertaken in September 2009, the approximate date nominated by him.
15. Mr Crowe also gave a rather misleading description of the works he undertook in 2009-2010. He made no mention of the significant alterations he made to the building envelope on the eastern side of the house, or the extensive internal remodelling on level six. Nor did he say anything about the work on the top terrace or the excavation undertaken on level four. It was simply not correct to say that the timber balcony only "marginally" extended the previous balcony/pergola structure. Nor was it correct to say that the roofing work only "marginally" extended the existing roof. The work in fact involved the addition of an entirely new section of roof which, unlike its predecessor, projected beyond the edge of the building envelope.
16. Mr Crowe's description of the alleged phone call from Mr Fernandez "in around February 2010" also diverges from the documentary evidence. According to Mr Crowe's file note (above at [137]), the $1 million figure was mentioned by Mr Fernandez on 4 February (although not in the context of an actual offer of sale, as Mr Crowe's affidavit stated). Mr Fernandez's departure from the Church Trust organisation was, however, only mentioned on 30 March. Nor did Mr Crowe say anything in the affidavit about the procedure for negotiations, by way of lease or sale, recorded in his note of 30 March.
17. It seems that when he made his first affidavit, Mr Crowe could only remember parts of the discussions which took place in 2020, and that he telescoped them together. In the absence of any written records, that would hardly have been surprising, given that Mr Crowe was trying to recall events from more than thirteen years before. But in fact, he did have the file notes in his possession. Why he did not refer to them in the affidavit was not explained in any of his later evidence.
18. Notice to Produce: On 9 August, following the service of Mr Crowe's affidavit, the Church Trust served a notice to produce on him. The notice sought the production of documents relating to the "construction work carried out in the area referred to by [Mr Crowe] as the 'Side Yard' in about 2009". Amongst the documents produced were invoices issued by: Ironwood Australia on 13 November 2009 for blue gum timber; DATS Environmental Services on 15 November 2009 for waste removal; and a series of receipts from Dulux Trade Centre dated 22 December 2009 and 28 January 2010 for turpentine and decking oil.
19. Change of representation: On 11 November 2023, Holding Redlich ceased acting for Mr Crowe and was replaced by Mayweathers. Three months later, on 22 February 2024, Dentons replaced Mayweathers on the record. Dentons continued to act for Mr Crowe during the course of the trial.
20. Amended version of Mr Crowe's defence and cross-claim (18 March 2024): After Dentons came onto the record, Mr Crowe's defence and cross-claim were amended. Both pleadings recited the 1963 Licence, the 1963 Lease and the 1966 Lease. In each case it was alleged that the disputed side yard works were carried out by Mr Crowe "with knowledge of and in reliance upon the Lease and the variation to the Lease and the long history of use of the Side Yard by 33 Edward".
21. Second affidavit (5 April 2024): Following the making of the amendments, a further affidavit was filed from Mr Crowe in April this year. Under the subheading: "'Improvement Works', State of Mind & Knowledge of Ownership of Side Garden", Mr Crowe sought to "clarify or correct" the evidence given in his first affidavit in relation to his knowledge at the time of the "installations" in the side yard.
22. Mr Crowe stated that "[as] best as I can now recall, the date I carried out the improvement works was late 2009/ early 2010". He then sets out, in greater detail than in the first affidavit, the works he undertook in the side garden: Improvement works to the existing concrete and sandstone located adjacent to the living room of 33 Edward, namely the laying of further concrete on top of the existing concrete and sandstone and levelling it and extending it into the side garden, in late 2009/ early 2010. Installation of an aluminium deck (timber look) in about 2019 to replace a timber deck I installed in the side garden in late 2009/ early 2010. The deck I had installed in 2009/ 2010 had balustrading around it to prevent children falling over the edge of the cliff. … Installation of a new balcony to replace the existing rotten balcony and extended into the airspace over the side garden in late 2009/ early 2010. Replacement of the roof with a minor encroachment into the airspace of 35 Edward in late 2009/ early 2010.
23. Mr Crowe stated that [91] in his first affidavit ([172] above) needed "to be clarified or corrected in the following manner": (i) When I first moved into the house at 33 Edward Street and for about 5 or 6 years after that, I had no need to know or understand where the precise eastern boundary of my property was. When I purchased the property after the auction, I assumed the side garden formed part of my land, as entrance to the property on the auction day was available via the side garden. (ii) For context, at the time of the auction in 2003 my first wife was suffering from [a medical condition] and we had been advised that our baby may not survive. I did not have a conveyancer review the contract for sale prior to the auction. I purchased the property on the day of the auction on site, after it was passed in. I signed the contract, together with my then wife on that day, and provided a cheque to the agent for the deposit amount. (iii) When I carried out work in the side garden in late 2009Iearly 2010, I knew there were lease agreements dated 30 January 1963 and 30 April 1966 between Agnes Turkington (the then owner of 35 Edward Street) and Bruce Gyngell (the then owner of 33 Edward Street) that permitted the use and occupation of the side garden by the owner of no. 33. I was aware that the second lease agreement was for a 99 year period. I therefore thought I had the right to do the work, and to use and occupy the side yard, given the existence of those lease agreements. My motivation to do the work in the side garden was primarily to make the property safe for my growing family. At the time I did the work, I was also aware of the Home Beautiful Article dated December 1966 … which referred to the lease agreement.
24. Mr Crowe explained (iii) by deposing: As best as I can now recall, some time between when I started occupying the house in July 2003 and when my first marriage broke down in February/March 2006, I received a box of documents from a neighbour, DiDi Broughton, whose mother, I understand worked as an interior designer with Ann Gyngell, Bruce Gyngell's wife …. In that box of documents there were copies of the lease agreements I refer to in [(iii)] above. ….
25. Mr Crowe did not mention the copy of the Home Beautiful article as having been in the box, although presumably it was. As already mentioned, the 1963 Licence was not: Mr Crowe specifically deposed that this document was obtained in October 2023 as a result of a historical search at Land Registry Services.
26. Mr Crowe went on to deal with [96] to [98] of his first affidavit, concerning his alleged conversation with Mr Pemberton in 2009 (above [173]) as follows: Paragraph 96 needs to be clarified to make clear that when I said "I thought that was part of my land" I was referring to my right to use and occupy the side garden rather than it being mine in an ownership sense. Paragraph 97 needs to be corrected to state that I was surprised that Mr Pemberton wanted to purchase the whole of the side garden, which included the area of land I was using and occupying. I was surprised because I believed I had the right to use and occupy the side garden. When my conversation with Mr Pemberton first started, I assumed the area of land Mr Pemberton was referring to was to that part of 35 Edward Street which is immediately to the east of the fence in the side garden. … I was surprised when Mr Pemberton told me that it was not just that area (that is, the area east of the fence in the side garden) that he wished to purchase from the Church, but the whole of the side garden, which included the area I was using and occupying, that he wished to purchase.
27. Part of the affidavit concerned knowledge of what was going on in the side yard on the part of the officers of the Church Trust. Mr Crowe deposed that he recalled "having two or three meetings on my property" with Mr Fernandez in the course of "my negotiations with the Church to purchase the side garden". According to Mr Crowe's recollection, those meetings occurred prior to April 2010. He deposed that he was unaware of any complaint by the Church about his use of the side garden or the encroachment of the structures until receiving the letter from Maddocks in November 2020 ([156] above).
28. Mr Crowe also responded to an affidavit which had been filed from Mr Lawlor. That affidavit was not in the end read, so exactly what it said is unknown. But Mr Lawlor appears to have deposed that, in a conversation between them, Mr Crowe "agreed there was no lease agreement for use of the side garden" and that he (Mr Lawlor) had raised the possibility of the Church Trust leasing, rather than selling, the side garden to Mr Crowe. Mr Crowe deposed that he did not agree with Mr Lawlor's account.
29. Mr Crowe also responded to another paragraph of Mr Lawlor's affidavit, which appears to have referred to later discussions between representatives of the Church Trust and Mr Crowe. Mr Crowe's response did not refer to the conversation with Mr Fernandez recorded in his 4 February file note, but he did refer to his file note of 30 March, which he described as having been taken at a "meeting" with Mr Fernandez "to discuss the potential purchase of the side garden". Mr Crowe also deposed that he and Mr Chikitch had a later meeting "on or about 15 April 2010 at Leichardt [presumably the location of the Church Trust's offices] to continue discussions about the potential purchase of the side garden from the Church". According to Mr Crowe, after the meeting, he tried to telephone Mr Chikitch and left a message which was never responded to.
30. In the final section of the second affidavit, Mr Crowe sets out the disadvantage to him if the Court was to order the removal of the encroachments. The disadvantages advanced by Mr Crowe include: not having the benefit of a second access to his home; not having external access to the top floor of his house; the "considerable expense and inconvenience" involved in removing the encroachments; and the fact that, as Mr Crowe asserted, the garden will become overgrown if he ceases to maintain it (grounded in his belief that the side garden cannot be accessed by the Church Trust for such purposes).
31. Finally, Mr Crowe deposed: If I knew the side garden was not part of my property or if I knew I did not have any right to use the side garden, I would not have incurred the time and cost since my purchase of the property to maintain the side garden… I would not have purchased the property at 33 Edward Street at all if I had been aware there was no legal right for me to use the side garden.
32. In this affidavit, Mr Crowe continued to give an inaccurate picture of the extent of the works he undertook in 2009-2010. He was also at pains to assert that the main purpose for the works in the garden was to improve its safety. I doubt that it was a coincidence that he said this in the affidavit in which he asserted for the first time that he undertook the works because he believed he was exercising his rights under the lease documents which he had received from Ms Broughton. Those documents contained express obligations to keep the garden in good condition and said nothing about the use of the garden area for any other purpose.
33. It is notable that in reformulating his case in this way, Mr Crowe referred to the 1966 Lease rather than the 1963 Lease. He expressly mentioned the 99-year term which was introduced in the 1966 version. Yet only the 1963 version was referred to in his letter to the Church Trust of 17 December 2009, and enclosed with that letter.
34. Furthermore, the letter stated that the 1963 Lease had only "recently come to [Mr Crowe's] hand". This was hardly consistent with Mr Crowe's evidence that he had received the documents from Ms Broughton between three and six years earlier. The affidavit did not contain any explanation of these discrepancies; indeed, the letter was not referred to in the body of the affidavit at all.
35. The documentary evidence also shows that Mr Crowe's insistence that he did not discuss a lease with Mr Lawlor is, at best, doubtful. Mr Crowe's own note of 30 March expressly refers to the possibility of a lease rather than sale. If there was some change in the parties' negotiating stance after the earlier conversation with Mr Lawlor, Mr Crowe does not say what it was, or what prompted it.
36. It is also notable that the affidavit pushed the date that the works were undertaken back from "about" September 2009 to "late 2009 or early 2010". The latter range of dates was mentioned at least six times in the affidavit. It is true that Mr Crowe stated, in effect, that the latter period now represented his best recollection. But he did nothing to explain what it was that had caused him to reconsider the question, and to abandon the view he had first held when he considered the question last year.
37. Third affidavit (2 May 2024): Mr Crowe's second affidavit was followed by a third, apparently supplementary, affidavit in May this year. Among other things, Mr Crowe deposed for the first time to a meeting with Mr Fernandez at the time of Mr Crowe's letter of December 2009: …on or around 17 December 2009, the same date as the letter, I attended a meeting with Mr Denis Fernandez of UnitingCare Australia regarding my interest in purchasing land including the Side Yard during which I handed him a copy of the December 2009 letter including its attachments. I recall that I raised the existence of the Lease with Mr Fernandez during this meeting. I recall Mr Fernandez appearing surprised by the existence of the Lease and saying words to me to the effed that "we will need to obtain legal advice on this."
38. Mr Crowe went on to draw attention to the reference in his file note of 4 February to being told that Mr Fernandez was obtaining advice on the Lease (which he had not earlier referred to). He also supplemented his account of the April 2010 meeting with Mr Chikitch, by stating that he "raised the Lease" during the meeting. He ended by deposing: I have not received any correspondence, written or verbal, from the Uniting Church or its representatives stating that the Lease is terminated or that the Lease had already been terminated.
39. Cross-examination: At the beginning of cross-examination, counsel asked Mr Crowe questions about his education and professional experience. Mr Crowe gave evidence that he had studied commerce at university and, thereafter, worked as a chartered accountant before transitioning into work as a "commercial strategy consultant", which was his occupation at the time he purchased number 33. Mr Crowe also said that he had purchased and rented multiple properties in his lifetime (including attending over 10 property auctions) and, because of his experience, understood the difference between owning and leasing.
40. The first topic of the cross-examination was what Mr Crowe believed about his entitlements to the side yard at the time he purchased number 33 (in 2003). In response to a series of questions from counsel, Mr Crowe said that he thought "part" of the land to the east of the property was owned by him but that he didn't know which part "because the home so naturally connected with this area". Mr Crowe conceded that, at the time of purchase, he was "unsure where the side yard specifically [was] and where the boundary specifically started and ended".
41. When I asked if he took any steps to find this information out, Mr Crowe said: No, I didn't, your Honour. I relied upon the sales brochure and my own inspection of the property at that time, which was a very difficult time for me. I'm not making excuses, it's my responsibility, I understand that, but I'm simply trying to explain where things were at for me at that time. The sales brochure is what I had in my hand when I went through the home, and it kind of just all made sense.
42. Mr Crowe was pressed about his reliance on the sales flyer which has been reproduced in full above at [54]. He said that the description of the property on page one as "overlooking the side tropical garden" led him to believe that he was purchasing the "side tropical garden".
43. As I have already described (above [168]), the copy of the flyer annexed by Mr Crowe in his first affidavit had been redacted and cropped. Among the redactions was the description of the land size as "6.1 x 22 metres". When counsel questioned Mr Crowe about why this was the case, he said he did not think the land size was "relevant".
44. I then asked Mr Crowe about his understanding of the property's dimensions: HIS HONOUR: So just looking at the diagram on [the sales flyer], can you tell me where the 22 metres you thought was? CROWE: I didn't - I didn't consider it, your Honour. I relied on that diagram. HIS HONOUR: What was the shape of the property you thought you were buying? …. CROWE: I believed it was the house of a rectangular shape, plus the side garden area, which to my best estimation on the day I purchased it was probably best depicted by the area enclosed by the wire mesh fence, but I wasn't certain. HIS HONOUR: What was the shape? CROWE: It's an irregular shape.
45. Counsel then took Mr Crowe to the contract for the sale of number 33. It was Mr Crowe's evidence that he did not review the contract, nor the survey contained therein (reproduced above at [52]), prior to signing the contract and completing the sale (nor after the sale). Mr Crowe went so far as to say that he did not know what was included in the contract, but that he "imagined" that it would contain "terms and conditions … dealing with the property being purchased". Notwithstanding this, when the survey was shown to Mr Crowe during cross-examination, he agreed that it accurately represented the state of the property at the time he purchased it.
46. Mr Crowe was then cross-examined on the various versions of his evidence about when he first learned that he did not in fact own the side yard. Mr Crowe said that for the "five to six years" after he purchased number 33, he believed that the side yard was part of his property. And he said that it was not until "February or March 2006", after he had received the box from Ms Broughton (above [188]), that he became aware of the fact that he did not own the side yard land. Mr Crowe stated that after reviewing the lease documents contained in the box, he formed the belief that he had a binding lease over the side garden.
47. In the light of this evidence, counsel asked Mr Crowe what he meant in his first affidavit when he affirmed his belief that he owned the side yard in "late 2009 and early 2010" when undertaking the improvement works. Mr Crowe explained that what he was actually trying to convey by this was that "he had no idea of the location of the boundary precisely". Similarly, counsel questioned Mr Crowe on his evidence about the conversation he had with Mr Pemberton in 2009 (above [173]) in which he recounted his "surprise" in response to the realisation, for the first time, that he did not own the side yard. Mr Crowe explained that he understood Mr Pemberton to be referring to "another steep garden" which was further east of the side yard and was separated from it by a "natural boundary" created by a "wire mesh fence", and that at the time of the conversation, he "believed that there was a lease for number 33 regarding [the] occupation and use of the side garden and yard area".
48. Mr Crowe was pressed about this explanation given his statement that, after the conversation with Mr Pemberton, he decided that he wanted to "acquire the side yard" so he could continue to use it as part of his property (above [173]). As I understood it, Mr Crowe's evidence was that his decision was the result of his uncertainty about "where the side yard started and ended"; "whether the land to the east of the wire mesh fence was included in the lease agreement or not"; and "whether [he] actually had any occupation rights of the land". When pressed on this uncertainty, Mr Crowe said that he believed that he had rights to occupy and use the side yard regardless of whether he owned it or not, but that he wanted to acquire the land to seek "some normalisation or regulation, some certainty" about his entitlements.
49. This is the context within which Mr Crowe commenced "discussions" with the Church Trust with a view to purchasing "part of 35 Edward Street which included the side yard". These discussions were the next subject of the cross-examination.
50. Counsel began by taking Mr Crowe to the subdivision plan which was sent to him by the Church Trust on 23 September 2009 (reproduced above [120]). Mr Crowe agreed that he reviewed this plan when it was sent to him, and, in particular, that he was aware that proposed Lot 202 in the plan represented the portion of land that he was negotiating to buy "some or all of" from the Church Trust. Mr Crowe also agreed that the Plan showed where the boundary of his property, number 33, was.
51. In this context, Mr Crowe was asked about the statement in his 22 October facsimile to the Church Trust ([122] above) that he had sent the Trust's survey to a valuation firm, Egan National Valuers, and was expecting a "Valuation Report" to be "finalised in the next two weeks". He said that despite the reference to a report being "finalised", he was only expecting an oral opinion. Pressed further, Mr Crowe said that he "would have" received "a verbal from a real estate agent" at the "end of 2009, early 2010", and believed the "reference point" given to him by the agent "was about $5000 a square metre" which was based on the recent sale price of a family home across the street. His final position was that "I never obtained a written valuation from [Egan National Valuers] and I don't believe I ever obtained a verbal valuation from them, but I certainly can't remember the figure if they did provide it".
52. Despite, on his account, not having obtained a formal valuation of his own, Mr Crowe said that he disagreed with the $1 million valuation obtained by the Church Trust, and communicated to him by Mr Fernandez on 4 February 2020 (above [137]), on the basis that it was "excessive". Mr Crowe said that "to the best of his recollection" he communicated this response to Mr Fernandez over a phone call. No such communication had been alleged in any of his affidavit evidence.
53. Mr Crowe agreed that he never put any counter-valuation or counter-offer to the Church Trust for Lot 202 or any part of it, saying that he felt as if he "had taken it as far as [he could]". When asked what was stopping him from obtaining his own valuation, Mr Crowe stated: I didn't think the Uniting Church had made their mind up as to what they were going to do with this land, so I considered that it may have been a waste of time and effort and energy. Because I hadn't received information around the zoning; I had no response to my suggestion to them that possibly we should both get valuations and would agree to a mid-point, … I felt like I'd put a lot of time in in the first three or four months of 2010 to try and do something, and it kind of just stopped…
54. Counsel then took Mr Crowe to his file note of 30 March 2010 and, in particular, the flowchart displayed thereon (above [141]). Mr Crowe agreed that this was the "approval process that the [Church Trust] would have to go through if it was to sell or lease any part of the land adjacent to [number 33]" as it was explained to him by Mr Fernandez. When Mr Crowe was asked if he ever went through this process he conceded that he did not but referred to the section in his second affidavit which sets out the meeting with, and subsequent unreturned telephone message to, Mr Chikitch at the end of April (above [193]). According to Mr Crowe, this was his attempt to fulfil "step 1 of negotiating with [Mr Chikitch]".
55. The transcript continued: COUNSEL: By the end of April 2010 you had previously been negotiating or what you describe as discussing with Uniting the possibility of purchasing part of Uniting's land adjacent to your property which included the side yard, but that had not proceeded; is that correct? CROWE: That is not correct. I can only say that I was waiting and I wouldn't say it had concluded, no, and I would say that it hadn't progressed. I would say I was waiting and the matter, in my mind, was still in an unresolved state in terms of what was on the subject table. … CROWE: I consider that I did not progress it any further than the end of April because I considered that I kind of had gone as far as I could.
56. This evidence raised more questions than it answered. I find it difficult to imagine that a professional valuer retained to provide a valuation report would produce only a verbal opinion. Be that as it may, there was no evidence that Mr Crowe ever provided any valuation figure, written or oral, to the Church Trust as he had foreshadowed. It is hard to see why this would have been, if Mr Crowe had in fact retained a valuer as he claimed, unless the valuation produced did not suit his interests or he changed his mind about the purchase.
57. I also find it difficult to accept that Mr Crowe could have believed that he had "taken things as far as he could" and that he was "waiting" on the Church Trust in April 2010. It is hard to see what he could have been waiting for. On the face of it, there was nothing to prevent him from making an offer, whether or not supported by a valuation of his own. Clearly it was nonsensical to suggest that the midpoint-of-valuations approach had broken down when Mr Crowe had not obtained, and was not apparently trying to obtain, his own valuation.
58. The next topic of the cross-examination was the works undertaken by Mr Crowe in the side yard. In particular, counsel sought to clarify when exactly the works had been undertaken. In the beginning, Mr Crowe said that these works occurred in "late 2009 and early 2010" and agreed that he obtained no survey, architectural plans, or development consent prior to undertaking the works. This reflected the evidence he gave in his second affidavit. But, as the first day of cross-examination progressed, Mr Crowe said that, having had "the opportunity to actually look at the circumstances", he now believed that the "works being conducted and the improvements suggested would have largely, if not all, been conducted in the first part of 2010".
59. Counsel pressed Mr Crowe on this change in his evidence by taking him to the various invoices and receipts that he provided in response to the notice to produce in August 2023 (see above [182]). Notwithstanding the terms of the notice to produce, Mr Crowe rejected counsel's suggestion that the blue gum timber and the decking oil were for the deck constructed in the side yard. Instead, he postulated that they might have been purchased for the north-facing balcony of the house and the invoices had been produced by mistake. Later he said that the timber which he used to construct the balcony and the deck was not, in fact, purchased at all, but rather retrieved from a repository of timber that he had been accumulating since he was a child at his family's farm in Echuca in Victoria.
60. On the second day of the cross-examination, after Mr Crowe had had "time to think about things", he drew a distinction between the "internal works" (the infilling of the lower terrace patio within the boundary), which he said had been undertaken first in time, and the "encroachment works" (works protruding beyond the boundary) which were undertaken afterwards. On this basis, he gave evidence that the encroachment works were undertaken "in April, May and June of 2010".
61. Mr Crowe explained this by saying that the "encroachment works" took five months to complete. The concrete slab was completed first, which provided the foundation for the timber balcony and deck which were constructed at the same time, and then, lastly, the roof extension was undertaken.
62. When pressed on dates, Mr Crowe said that the laying of the concrete slab did not actually begin until February. He was sure of this because in January he was in Echuca "dealing with timber" and "away on family holidays". He also said that "most" (but, it was implied, not all) of the works had been completed by 7 May, a date which he was able to fix because it was the date of his son's birth.
63. I was left with little confidence in Mr Crowe's evidence on this subject. It wore the appearance of a self-serving attempt to accommodate his estoppel claim. The sequence of works Mr Crowe described may have been correct. But clearly when Mr Crowe first thought about the question of timing, his recollection was that the works were undertaken in late 2009 or early 2010. What Mr Crowe did not explain was what objective reasons there were for thinking that in fact it had all happened three or four months later. Nor did anyone corroborate Mr Crowe's suggestion, made for the first time in cross-examination, that there had been some mistake in answering the notice to produce.
64. The final topic of the cross-examination concerned the lease arrangement said to exist over the side yard land, and, in particularly, Mr Crowe's perceived entitlements under such arrangement. Counsel commenced this section of the cross-examination by asking Mr Crowe about his reaction, after receiving the box from Ms Broughton, to the discovery that he did not in fact own the side yard but rather that had a lease over it. Counsel asked Mr Crowe why he did not obtain a survey or any advice from his lawyers or real estate agents about the new lease information, or at least, to confirm the boundaries of his property. Mr Crowe replied: Because to me, it wasn't that significant. It was to my impression, the area of land was very clearly just so obviously connected to this house, and so obviously used by its residents as it had been for so damn long, that it was kind of - to me, I looked at the lease and I said, well, you know, okay, that - that kind of looks about right. So that's why I didn't seek legal advice, that's why I didn't actually think that this was so significant because it just kind of felt that it was natural.
65. When asked about his interpretation of the actual area covered by the lease documents at the time he reviewed them, Mr Crowe answered: … the side garden and the side yard. I did not know whether that extended all the way across the mesh fence and continuing east. I was less sure about that parcel of land to the east of the mesh fence - I was less sure. To my sense it appeared that the side garden and the lease covered the area surrounded, to the south, by that wall and up to the black fence, which is now black but it used to be a mesh fence, so I would say around that sandstone wall coming down and surrounding the mesh fence down to where the mesh fence ends. That, to me, felt like it was the possible area but I wasn't sure because, as I said, I felt that it's just as likely, possibly, that the area extended beyond that wire mesh fence, which is why I kept maintaining it because I didn't really know.
66. Mr Crowe indicated that at the time he became aware of the lease documents, he thought, but was "not 100% sure", that the lessor was the Church Trust and that the term of the lease was for 99 years (although he did not know when this term commenced).
67. Counsel put it to Mr Crowe that, if he had truly believed in the existence of a binding 99-year lease in his favour from 2006 onwards, there would have been no need for him to enter into discussion with the Church Trust in 2009 to try to purchase the land or, at the very least, he would have mentioned the lease to Mr Lawlor during the 16 June 2009 meeting (above [116]). Mr Crowe disagreed with the proposition. No further explanation was offered as to why.
68. Counsel then took Mr Crowe to the letter he sent to the Church Trust on 17 December (above [124]-[136]). First, counsel asked why Mr Crowe did not notify the Church Trust in the letter of his intention to undertake the improvement works. Mr Crowe gave evidence, for the first time, that: I did notify them, and I feel that a discussion was had with Dennis Fernandez at the same time as I hand-delivered this letter to him, and I believe that I've also, to answer your question previously, I believe that this letter [refers] to some works that I was proposing.
69. The reference in the letter was identified by Mr Crowe as the following statement: "My desire is to purchase the number 35 and gradually improve it as a garden and outdoor area for my family".
70. Next, counsel enquired as to why Mr Crowe only attached a copy of the 1963 Lease to the letter and did not provide the Church Trust with a copy of the 1966 Lease at the time of the negotiations, or indeed, at any point thereafter. Mr Crowe's explanation was somewhat involved. He said that his marriage breakdown was very acrimonious. At some point in 2006, the house at number 33 was ransacked by his ex-wife, and papers, including the contexts of the boxes provided by Ms Broughton, were strewn all over the floor. During the clean-up, the papers were shovelled into garbage bags. Number 33 was then rented out. Some of the garbage bags were moved to a rural property in Victoria, owned by Mr Crowe's mother. The other bags were taken to another of Mr Crowe's properties in North Sydney. Later, Mr Crowe bought his former wife out of number 33 and moved back with his second wife. The garbage bags which had been at North Sydney were brought back. Shortly before he sent the December 2009 letter, Mr Crowe found the 1963 Lease in one of those bags. This was why he stated in the letter that the Lease had "recently come to hand". The 1966 Lease, however, had ended up in the garbage bags which went to Victoria, which remained forgotten and undisturbed until 2023, when the 1966 Lease was re-discovered.
71. The transcript then includes the following exchanges: COUNSEL: As at December 2009 did you believe that there was one or two leases that were binding, or some other position? CROWE: I'm not a lawyer, so my understanding is very simple. There was a series of agreements between the landlord and, at that time, the person who was occupying and owned number 33. I was under the impression that those agreements, effectively, said, "Number 33, you have obligations to do certain things in this area and the term of that agreement would appear to be the longest time is 99 years." I really don't know when that started but I took it to mean that it was certainly underway and underfoot on currency, for want of a better description, on currency, because to my impression, when I purchased the home and certainly every day since, it's kind of been used like that, so I was under the impression that the agreement - whether it's one or two - was to the basic effect of the way the land was being used with some question about how far that land went to the east. … COUNSEL: But at the time of writing this letter your evidence is that it was your belief that there was a binding 99 year lease in your favour over the side yard; that's right, isn't it? CROWE: That's right. COUNSEL: Why didn't you just write that in this letter? CROWE: Because I didn't have it to my hand.
72. Counsel then moved on to the caveat which was lodged, on behalf of Mr Crowe, on the title of number 35 in 2021. Counsel asked Mr Crowe why the "claimed estate or interest" in the caveat did not include any reference to "any estate or interest by reason of a lease over the land". Mr Crowe's response was, effectively, that the caveat was organised by his lawyers and that he did not know.
73. Indeed, it was put to Mr Crowe that there was no reference to a binding lease which appeared in: any of the correspondence sent by his solicitors, Holding Redlich, to Maddocks; his original defence to the Church Trust's statement of claim; or in his original cross claim in the proceedings; and that the first time any claim relating to a binding lease was put by Mr Crowe was in May 2024. Mr Crowe rejected the consequential suggestion that he did not have any genuine belief that there was any binding lease between him and the Church Trust. Instead, Mr Crowe explained that he believed that, pursuant to the lease, he had "an obligation to maintain the side yard area however defined that might be, to keep it in a good and proper order, to maintain the garden, not cut down any trees, do my level best to try and keep the garden, as I said, in a good and proper order".
74. Counsel then pressed Mr Crowe on what rights of building he believed that he had under the lease. Mr Crowe said: The belief was that I could build improvements that achieve the objective of making this area safe and secure for family and keeping the garden in good and proper order, because my interpretation of living there for so long is that that was what the space was, indeed, designed to do and the timber balustrading and the fencing there was the solution that I considered to be a more suitable and safer solution than fixing and mending the wire mesh fence, which was in a very unsafe area. So I couldn't construct this timber fencing as a fence without actually having some base to it and I considered that this deck, after some consideration and planning in my mind, was the most sensible solution to try and make this area proper and good, safe and secure for families and for the garden area.
75. In relation to his entitlement to undertake the concreting, Mr Crowe stated that he believed that it was necessary to make the area safe as it was "non-slip", and the garden was "quite affected by water". As for the balcony, I understood Mr Crowe's evidence to be that the timber pillars which supported the balcony were a part of the deck fencing and that the construction of the balcony "sensibly" followed in the interest of "making the most of the area to make it family friendly…".
76. I found this evidence quite unbelievable. No doubt, in undertaking his extensions, Mr Crowe wanted the expanded and improved recreational areas that he was creating to be safe for members of his family and visitors. But it was ludicrous to suggest that he undertook the construction of the balcony and the deck for any reason other than to improve the amenity of his home.
77. Credit: I have already referred to some of the gaps and inaccuracies in Mr Crowe's affidavit evidence. They are not the only matters in the affidavits which invited scepticism.
78. The fact is that, on the critical issue in the case, Mr Crowe completely changed his story between last year and this year. He first claimed that he undertook the works in the side yard believing himself to be the owner, and that he only learned to the contrary from Mr Pemberton. His second story was that he undertook the works believing that he was entitled to do so as lessee, a belief based on documents he claimed to have had in his possession since 2006 at the latest. On this version of events, his account of the alleged conversation with Mr Pemberton was absurd. His attempt, in his second affidavit, to reinterpret and salvage that account was extraordinarily strained and unconvincing.
79. When he reached the witness box, Mr Crowe proved an unimpressive witness. I have already commented on some of the aspects of his evidence which I found unsatisfactory. As will be seen, there are others.
80. Counsel for the Church Trust pointed out, in their closing submissions, other, more general, problems with Mr Crowe's evidence. He frequently gave non-responsive and argumentative answers. He also repeatedly, despite warnings about the need to avoid reconstruction, gave evidence in the form of what he "would have" done or thought. Counsel also accused him of giving detailed and convenient evidence for the first time in cross-examination, and, on some occasions, feigning ignorance to avoid or delay answering questions.
81. Counsel for Mr Crowe, in his closing submissions, did not take issue with these criticisms. Rather, counsel sought to persuade me that I could, and should, find in Mr Crowe's favour based on the objective evidence, without having to rely on his uncorroborated testimony.
82. In these circumstances, I have treated Mr Crowe's evidence with extreme caution. I was left with the impression that he was more interested in telling me what he thought would support his case rather than providing a candid account according to what, if anything, he could actually remember. I am reluctant to rely on his evidence, unless given against interest, without some form of corroboration.

Testimony of Mr Crowe's other lay witnesses

1. Two lay witnesses were called on behalf of Mr Crowe: Frederick Bertrand Giessler and Robert Adrian Anthony van Veenendaal. Each provided an affidavit in the proceedings, and both were cross-examined at the hearing.
2. Mr Giessler co-owned number 33 with his then wife from 1977 until 1993. He deposed that he "was aware the side-yard was not part of 33 Edward Street's title" but, notwithstanding this, he continued to maintain it. During cross-examination, Mr Giessler confirmed that, at the time he purchased number 33, he knew he was buying a "very long, thin piece of land" which did not include the side yard (which he knew at the time to be owned by the Methodist Church).
3. Mr Van Veenendaal co-owned number 33 with his wife from 1999 to 2003 (when he sold it to Mr Crowe). He deposed that, during his inspection of number 33 in 1999, the real estate agent told him that "[t]he Side Garden is part of the neighbour's, 35 Edward Street, land, but it is only accessible through 33 Edward". His affidavit went on to describe that, during his occupation of number 33, he had "uninterrupted access" to the side yard and used it as a gardening area, a space to entertain guests and a children's play area.
4. During cross-examination, Mr Van Veenendaal gave the following evidence: COUNSEL: In relation to the side yard, at the time you purchased the property, you were well aware that it wasn't part of the land you were purchasing; correct? VAN VEENENDAAL: Yes, that was pointed out by the real estate agent straight away. COUNSEL: Is it fair to say that at no time between the time you purchased the property and the time that you sold the property you had any real understanding of what your legal right was to go onto; is that correct? VAN VEENENDAAL: Correct.

Testimony of Church Trust witnesses

1. An affidavit was filed from Mr Lawlor but was not read at trial. This was explained in an affidavit from a solicitor for the Church Trust. The explanation was not questioned and there was no submission that a Jones v Dunkel inference should be drawn.
2. There was no evidence from Mr Fernandez or Mr Chikitch. Mr Fernandez of course ceased to work for the Trust in 2010 and it seems that Mr Chikitch may also have left, but there was no actual evidence that either of them was unavailable.
3. An affidavit was read from Owen Patrick Judge. Mr Judge held the position of Strategic Asset Planning Manager in Uniting Care Ageing between October 2014 and August 2016. His evidence concerned a meeting which took place in 2016 between the Council and the owners of numbers 33, 35 and 37. Mr Judge was cross-examined, and, as a result of concessions he made in cross-examination, the meeting ceased to be relevant for the purposes of the case. Affidavits were read from two other, more recent, executives of the Church Trust, but their evidence was formal, and they were not cross-examined.

Conclusions on disputed factual issues

1. I do not accept Mr Crowe's evidence that he was unaware at the time he purchased number 33 that it did not include the side yard. I note that counsel for Mr Crowe did not invite me, despite Mr Crowe's express evidence that he would not have bought the house had he thought otherwise, to make any finding of detriment in accordance with that evidence.
2. Counsel's decision was hardly surprising. The boundaries of number 33 were clearly shown in the 1999 survey ([52] above), which, in accordance with usual conveyancing practice, was attached to the contract. It is not credible that anyone, let alone a person of Mr Crowe's experience and education, would spend over $1 million on a property without an understanding of what they were actually buying. It is also highly unlikely that Mr Crowe could have got the idea that the side yard was part of number 33 when it had been quite clear to previous owners (including Mr Van Veenendaal, the vendor, and no doubt his agent as well) that this was not so.
3. In any event, the size and shape of the property were clearly disclosed in the sales flyer which Mr Crowe admits to having received. I do not consider he ever adequately explained why that information was redacted from the copy of the flyer attached to his affidavit. In these circumstances, I found the twists and turns in Mr Crowe's evidence on this issue, summarised above, entirely unconvincing.
4. The documentary evidence establishes without any doubt that Mr Crowe had the 1963 Lease by 17 December 2009, when he sent a copy of it to the officers of the Church Trust. The accompanying letter stated that the Lease had only "recently" come to hand. It had not been referred to in earlier correspondence, and in that context, the natural understanding of "recently" would be no more than a few weeks.
5. Mr Crowe's letter did not refer to the 1966 Lease. That document was expressed to be a variation of the 1963 Lease, to which Mr Crowe did refer. I do not accept that, as Mr Crowe claimed in his second affidavit, he was aware of the 1966 Lease at the time of the letter. The natural inference is that he was not, otherwise he would have referred to it.
6. It may be accepted that Mr Crowe obtained his copies of the 1963 and 1966 Leases and the Home Beautiful article from a box of papers provided by Ms Broughton. Ms Broughton may or may not have given the box to Mr Crowe or his former wife between 2003 and 2006. The papers may later have been disturbed by Mr Crowe's former wife in the way he described (above [234]). But even if so, I do not accept that Mr Crowe was aware of the existence of either Lease until shortly before his letter to the Church Trust of 17 December 2009, and even then, I do not accept that he was aware of the existence of the 1966 Lease.
7. I think it is far from obvious that the discovery of the 1963 Lease in 2009 would necessarily have led Mr Crowe to believe that it was still in effect. The Lease had been entered into by a former owner of number 35 in favour of a former owner of number 33 and had not been registered. It had not been relied upon by any of the previous owners and had not been disclosed in the contract under which Mr Crowe had purchased number 33.
8. Any lawyer would have appreciated that an unregistered lease would not have been, or at least would have been highly unlikely to be, enforceable more than 40 years after Mr Gyngell had sold number 33 and almost 40 years after the Church Trust had acquired number 35. I dare say that many lay people with experience of Torrens title would have drawn the same conclusion.
9. And even if its unregistered nature were put to one side, the mere discovery of the Lease did not demonstrate that it was still current. For all Mr Crowe knew, it might have been terminated or surrendered at any point over the intervening decades. On his own evidence, Mr Crowe made no enquiries about this issue at all. Of course, the 1963 Lease had actually been varied by the 1966 Lease.
10. In my opinion, these uncertainties are consistent with the way in which Mr Crowe referred to the 1963 Lease in his letter. The reference to the Lease was thrown in as a subordinate point alongside other subordinate points such as the reference to recently killing a snake on the property.
11. I accept that, although all the discovery of the Lease proved was that it had once been in force, Mr Crowe referred to the 1963 Lease as then "existing", in the present tense. But he did not actually say that he had a leasehold interest, or how long that interest would last. Indeed, he did not say anything about the terms of the Lease at all.
12. Nor was Mr Crowe's conduct as a whole consistent with a belief that he had a leasehold interest, or at least a long-term leasehold interest. Why would he contemplate spending hundreds of thousands of dollars on buying the side yard if he believed he already had a lease over it? Even if, as a matter of neatness, he had still wished to acquire the freehold to the whole of the Edward Street frontage of number 35, the fact that he held a lease over part of it would have greatly reduced any price that he would have had to pay. Either way the existence of the Lease would have been the first point mentioned in the December 2009 letter. Instead, Mr Crowe continued to deal with the Church Trust on the footing that he would pay market value for the land.
13. Furthermore, the documentary evidence makes it clear that his discussions with the Church Trust extended to the possibility of a lease rather than a purchase. If he believed he already held a lease that would have been even more inexplicable.
14. It is also true that the Woollahra Council's compliance officer recorded Mr Crowe as saying in May 2020 that he held a lease which had entitled him to undertake the works in the side yard. But I do not think this is of any real significance. As already noted, Mr Crowe also told the compliance officer that the balcony and patio had previously encroached into number 35 and that was not accurate. His statement was made long after the event, and was a self-serving one in the context of the legal action which had been threatened by the Council. And when, a year later, Mr Crowe instructed his solicitors to make a formal response on his behalf to the Church Trust's complaints, and lodge a caveat over number 35, he did not refer to the supposed leasehold interest at all.
15. In these circumstances, I do not accept that Mr Crowe believed, at the time he undertook the works in the side yard, that he had any entitlement (or at least any long-term entitlement) to occupy it under the 1963 Lease. The reference to the lease "existing" may have been only a clumsy way of saying that the document had been discovered. Or it may have been a negotiating flourish. But whatever the explanation, I am not satisfied that Mr Crowe then saw it as a matter of established legal entitlement. Still less am I prepared to accept that, as Mr Crowe claimed in his second affidavit, he believed at the time that he had a 99-year leasehold interest in accordance with the 1966 Lease.
16. I accept that the meeting between Mr Lawlor and Mr Crowe in June 2009 took place in the side yard, and, accordingly, that Mr Lawlor would have appreciated that Mr Crowe had been occupying and maintaining the side yard since his purchase of number 33 in 2003. But I do not accept that Mr Lawlor's knowledge went any further than that. At the time of the meeting, Mr Crowe had not undertaken any of his works in, or projecting over, the side yard. Nor would there have been any reason for Mr Lawlor to have assumed that he had been responsible for the improvements which existed in the side yard at that time. For all Mr Lawlor knew, those improvements might have predated the Church Trust's acquisition of number 35 (as, it seems, they in fact had).
17. Nor do I accept Mr Crowe's other embellishments, in alleged oral dealings not recorded in the documentary evidence, concerning his discussions with other officers of the Church Trust.
18. In particular, I do not accept that Mr Fernandez visited number 33 as Mr Crowe claimed in his second affidavit, if that is meant to suggest that Mr Fernandez saw Mr Crowe undertaking works in, or encroaching upon, the side yard. Mr Crowe did not himself actually say this, and there is no documentary evidence of any visits by Mr Fernandez at the time. Any discussion between Mr Crowe and Mr Fernandez may have taken place on the telephone or at the Church Trust's offices. I am not prepared to accept the passing reference to a visit in Mr Crowe's affidavit.
19. Nor do I accept that Mr Crowe told Mr Fernandez, when delivering the letter of December 2009, that he was planning to undertake, or was undertaking the works in the side yard. The suggestion seems to me to be inherently implausible, as, had they known, the most likely response from the Church Trust executives would have been to tell Mr Crowe not to alter the side yard, at least until the question of ownership and sale was sorted out, and I have no doubt that that is the way in which it would have been perceived by Mr Crowe. Furthermore, although the December 2009 letter spoke of Mr Crowe making improvements to the side yard, it referred to that being part of his future plans if he made the purchase ([133] above). The natural implication was that no works were being undertaken or contemplated at the time.
20. As already noted, the evidence from Mr Crowe that he told Mr Fernandez about the works in the side yard emerged at the last minute in cross-examination, not having been mentioned in any of his previous affidavits, when such a conversation, had it occurred, would have been a vital part of Mr Crowe's defence. I disbelieve him on this point.
21. Nor, finally, do I accept that Mr Crowe tried to contact Mr Chikitch after April 2010, but Mr Chikitch never replied. It is hardly likely that, if Mr Crowe was still contemplating the purchase of number 33 at the time, he would have allowed that to put him off. It is far more likely that by that point he had simply lost interest.
22. It is true that neither Mr Fernandez nor Mr Chikitch gave evidence in the Church Trust's case, and there was no evidence before the Court that the Trust could not have practicably called them (as there was for Mr Lawlor). But, as already noted, most of the embellishments in Mr Crowe's testimony which concerned these individuals came very late in the day, and they raised more questions than they answered. Given these, and other deficiencies, in Mr Crowe's evidence, I do not think that the absence of evidence from Mr Fernandez and Mr Chikitch has any real significance.
23. As to when the works in the side yard were undertaken, no-one suggested that Mr Crowe undertook them before he received the survey from the Church Trust which showed clearly that the side yard was part of number 35. That was in September 2009. It is clear from the aerial photographs that the works had not been completed by then; indeed, they might not even have begun.
24. The aerial photographs show that the extension work, at least so far as it concerned the roof, had been completed by March 2010. The photograph does not prove that construction of the deck in the side yard had been completed, but it does not establish that it had not been either. In these circumstances I do not accept Mr Crowe's belated suggestion that the works might have continued into April or May or even June. I do not believe that Mr Crowe has any reliable recollection on the question, and I am not satisfied that he in fact completed the works before the negotiations with the Church Trust petered out in mid-2010.
25. It might be said that the fact that Mr Crowe undertook the works in the side yard is itself an indication that he must have believed that he had some rights over it. But I do not find that point persuasive. Although his counsel argued in closing submissions that the terms of the 1963 Lease allowed Mr Crowe to build anything he wanted in the side yard, there is no sign that Mr Crowe saw it that way. As already noted, he seems to have believed, even at the time he prepared his affidavit, that any rights associated with the Lease were confined to rights ancillary to maintaining the area as a garden.
26. And although the construction of works on land which Mr Crowe did not own was reckless, Mr Crowe had shown himself to be similarly reckless in failing to obtain approval from the Council. Why he acted so foolishly is a matter for speculation, but the Church Trust is under no obligation in these proceedings to demonstrate what his thinking was. The onus is on Mr Crowe to prove that at the relevant time he had the beliefs which he alleges, and I have not been satisfied that he did.

Planning and valuation evidence

1. Both parties retained expert town planners and valuers to give evidence in the proceedings. The planning experts were Mr Brett Brown (for the Church Trust) and Mr Jeremy Swan (for Mr Crowe). The valuation experts were Mr Paul Dale (for Mr Crowe) and Mr David Lunney (for the Church Trust).
2. In each case the experts submitted reports of their own and then, after a conclave, a joint report. At the hearing there was some supplementary concurrent evidence.
3. The main topic addressed by the planners' evidence was the potential for future development of the Edward Street frontage of number 35, including the side yard. Mr Brown and Mr Swan considered three possibilities.
4. The first was a complying development (that is, a development not requiring approval). Both planners agreed that such a development could not be undertaken. Paving and the construction of pathways could in theory be carried out as an exempt development. But this would be of no practical use without access, either upwards from Edward Street or downwards from the top of the cliff, and any access works would require a development application.
5. The second possibility was a development which would expand the existing retirement village. The planners agreed that the existing village already has open space as part of its approval and that development of number 35 as further open space was therefore unlikely (although I did not understand them to suggest it would be impracticable). The question they considered was whether an expansion of the built area of the village would be feasible.
6. Mr Brown considered that it would be. It might, he thought, include a northwards expansion of the existing building at the top of the cliff, or the construction of a freestanding two-story building connected by an elevated walkway, for instance. Mr Swan disagreed. In his view, the topographical constraints and the need to minimise amenity effects on number 33, such as solar access and privacy, made such a development highly unlikely.
7. The third possibility was development of the Edward Street frontage of number 35 for residential purposes. The planners agreed that there were two scenarios to be considered. One involved the development of that part of number 35 as a standalone residential site. The other involved its development as part of the redevelopment of the whole of the Church Trust's holding. The latter scenario would permit multi-dwelling housing (MDH) or residential flat building (RFB) development, both of which were permissible under the relevant zoning.
8. Both planners agreed that without a detailed design it would be difficult to provide a definitive opinion of the likelihood of approval. One particular problem with the first scenario would be access. Mr Swan was sceptical about whether access could be achieved from the Edward Street side, which was one of the possibilities suggested by Mr Brown. According to Mr Swan, councils nowadays are less inclined to allow the use of road reserves to facilitate such access than they were in the past. Mr Brown however was generally of the view that access problems could be solved (particularly under the second scenario, which would bring access from View Street into play) and some form of dwelling house could be approved.
9. On the view I take, it is not necessary to resolve these differences of opinion.
10. In his report, Mr Brown also made some comments relevant to the application for a compulsory easement in favour of number 33. He noted that there had been sufficient private open space in the original development for it to be approved, and the same was so with the LEC approval of the renovation works (noting the existence of open space in the top terrace area). Mr Swan did not apparently disagree.
11. Mr Brown stated that the upper stair was not compliant with the National Construction Code ("NCC") and nor was the glazing on the property boundary which had been created as part of Mr Crowe's extension works. He also expressed the view that the stairs, the deck, and the encroachments were not necessary for the effective use of number 33, as it had originally been approved without those structures.
12. Mr Swan pointed out that compliance with the NCC was not part of a town planner's expertise. He acknowledged that the top stair was accessible internally, but stated that it could "make logical sense" to provide access externally. In my view, whether the statutory discretion should be exercised in favour of a compulsory easement application is really a matter for the Court and I have not placed any evidentiary weight on the opinions expressed by the planners on that question.
13. I turn to the valuation experts. Their views were heavily influenced by their competing interpretations of the planning evidence. Mr Dale concluded that the Edward Street frontage of number 35 was "readily capable of development as a site for a prestige home". He ascribed various different rates per square metre to various parts of the land, resulting in an average or "blended" rate of $11,400 per square metre. Mr Lunney, on the other hand, concluded from the planning evidence that the land had "very little development potential". He valued it at $2,500 per square metre. For the purpose of their joint report, however, Mr Dale and Mr Lunney compromised on a figure of $5,000 per square metre which they were both prepared to accept.
14. There remained some disagreement about the manner in which this figure should be applied for the areas which were specifically the subject of the applications under CA s 88K and EBA s 3. But on the views I have formed, it is not necessary to go into those issues.

Entitlement to occupy the side yard

1. Mr Crowe's claim to be legally entitled to occupy the side yard focused on the 1963 Lease. His contention was that he was entitled to enforce the terms of the Lease against the Church Trust by way of estoppel, or implied agreement, albeit only as a personal licence.
2. Although nothing was said about this expressly, it follows, I think, that Mr Crowe's right of occupation, if established, would be confined to the area which was the subject of the 1963 Lease (the "Leased Area"). The Lease demised to Mr Gyngell the area then occupied by him, but did not contain a metes and bounds description of that area. It would be natural to equate it with the Licensed Area specified in the 1963 Licence. But as I have pointed out, the precise location of the Licensed Area is not clear from the evidence, and it seems not to have covered the whole of the landscaped area of the lower terrace on number 35. In view of the conclusions I have reached, it is not necessary to go into this any further.
3. The alleged entitlement was based on Mr Crowe's dealings with the Church Trust concerning the 1963 Lease in 2009 and 2010. Counsel for Mr Crowe accepted that such an entitlement only arose at that time. Counsel's argument did not rely on the Lease having directly conferred any rights on Mr Crowe as Mr Gyngell's successor in title. As part of Mr Crowe's defence, he did advance such an argument, which I deal with below, but it only involved a right to occupy on a month-to-month basis.
4. It was critical to counsel's argument that Mr Crowe was claiming to enforce the 1963 Lease as a personal licence, rather than a leasehold interest. The claimed entitlement was to occupy the Licensed Area until Mr Crowe chose to terminate the licence. Counsel accepted that a leasehold interest of that indefinite type could not validly be created, either under Old System title or Torrens title: Mexfield Housing Co-operative Ltd v Berrisford [2012] 1 AC 955 at [23]-[33] (Lord Neuberger, with whom the other members of the Supreme Court agreed). But a licence, counsel submitted, could be.
5. There was another difficulty with the terms of the 1963 Lease which counsel sought to meet in a similar way. The Lease contained specific obligations requiring Mr Gyngell to maintain the Leased Area as a garden. On the face of it, this might not have been consistent with the works done by Mr Crowe in the side yard, and, in particular, the extension of the house into it.
6. Counsel submitted, however, that once it was accepted that Mr Crowe was entitled to occupy the Leased Area, he was entitled to undertake any lawful activity in it. At the end of the licence, he might have to remove any structures he had erected in the Leased Area, but that was another question, which did not, at present, arise.

Estoppel by convention

1. The relief relevantly claimed in Mr Crowe's statement of cross-claim was: … 7. A declaration that the Cross-Defendant is estopped from denying that the Cross-Defendant is entitled to occupy the Side Yard under an agreement between the Cross-Defendant and Cross-Claimant on the same terms as the Lease save that: (a) the parties to the agreement are the Cross-Defendant as licensor and the Cross-Claimant as licensee; (b) the agreement took effect as a licence only. 8. A declaration that on the proper construction of the licence the subject of the estoppel declared above, it may be terminated (other than for cause) by the licensee only. …
2. The applicable principles are not in dispute. The elements of an estoppel by convention were set out by Brereton J in Moratic Pty Ltd v Gordon [2007] NSWSC 5 at [32] in a passage which has repeatedly been approved by the Court of Appeal (see Miller Heiman Pty Ltd v Sales Principles Pty Ltd [2017] NSWCA 106 at [42]-[44]): … In common law conventional estoppel, it is necessary for a plaintiff to establish (1) that it has adopted an assumption as to the terms of its legal relationship with the defendant; (2) that the defendant has adopted the same assumption; (3) that both parties have conducted their relationship on the basis of that mutual assumption; (4) that each party knew or intended that the other act on that basis; and (5) that departure from the assumption will occasion detriment to the plaintiff …
3. Counsel developed the estoppel argument by pointing out that it is well recognised that an estoppel can be created as to the existence of a legal relationship between the parties even when that relationship does not, in law, exist (for example, Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387). Counsel also submitted that if an estoppel by representation is proved in specific terms, then the construction of those terms is a matter for the Court and may not coincide with the subjective beliefs of the party estopped.
4. In point of fact, there was never a shared actual assumption between the parties about the effect of the 1963 Lease. Even if Mr Crowe believed that it entitled him to an exclusive licence of the side yard for as long as he wished, that was not the Church Trust's understanding. The advice the Trust received was that any rights that Mr Crowe had under the Lease could be terminated on one month's notice.
5. But when Brereton J refers to the adoption of a mutual assumption, his Honour is referring to an outward manifestation of the parties' statement and conduct. The parties' uncommunicated subjective beliefs are not directly relevant for that purpose. To that extent, I accept the argument from counsel for Mr Crowe that the existence and terms of such a mutual assumption are matters for the Court.
6. Even so, I do not accept that the parties in the present case adopted any mutual assumption along the lines alleged. All that happened was that Mr Crowe asserted that "a lease [existed]" between the parties, referring to the 1963 Lease (but without saying anything about the term of that Lease), and the Church Trust responded by saying that advice would be sought.
7. It may be accepted that, as counsel for Mr Crowe pointed out, the necessary mutual assumption may be adopted tacitly. The suggestion was that, in failing to respond to Mr Crowe's letter of December 2009, the Church Trust effectively accepted that Mr Crowe's statement about the "existence" of the 1963 Lease was correct. But it is necessary to look at the whole context.
8. At the time the discussions were taking place, almost 50 years had elapsed since the execution of the Lease. The parties had no knowledge of what else had passed between Mr Gyngell and Miss Turkington during the period of Mr Gyngell's ownership of number 33, which had ended when Mr Gyngell sold the property in 1970. The Church Trust could not reasonably be expected to have undertaken comprehensive investigations into the current status of the Lease within a matter of a few weeks, or even a few months.
9. In any event, the course of the discussions did not require any such investigations to be carried out. As already noted, Mr Crowe's letter of December 2009 mentioned the "existence" of the 1963 Lease but did not make that an essential element of his negotiating position. Rather, he continued to propose the purchase of Lot 202. There is no mention of the Lease in his file notes from February and March 2010; they were all about purchase (or the grant of a new lease).
10. In my view, the parties never adopted any mutual assumption as to the "existence" of the 1963 Lease before their discussions petered out, apparently due to lack of interest from Mr Crowe, in mid-2010. The conventional estoppel claim fails for that reason alone.
11. This analysis is actually too favourable to Mr Crowe. To entitle him to relief, the alleged convention must have been established before he acted to his detriment. The alleged detriment was his undertaking of the works in the side yard, supposedly on the assumption that the 1963 Lease entitled him to occupy the Licensed Area indefinitely. Those works were under way by late January 2010. This was clearly insufficient time for the lack of response to the December 2009 letter to convey any acceptance of anything in it by the Church Trust. Indeed, for all the Court knows the works may well have begun before the letter was even sent.
12. Furthermore, for reasons I have given, I am not satisfied that Mr Crowe in fact believed, at any time in 2009/2010, that he had a "lease" which entitled him to indefinite occupation of the side yard. And if he did have such a belief, it was not a belief which derived from any conduct of the Church Trust. Nor am I satisfied that Mr Crowe was acting on any such belief when he undertook the extension works which constitute the alleged detriment. The claim based on estoppel by convention fails.
13. Had I reached a different view, I am still not sure that the hybrid proposed by counsel between an instrument (the 1963 Lease) apparently having one effect (as a lease) and an estoppel creating a different effect (as an exclusive licence) would have been viable.
14. Estoppel is, par excellence, a doctrine which exists to protect the expectations of lay people who may not have a clear understanding of property law and conveyancing. I find it surprising to think that the parties could make a mutual assumption about an instrument having an apparently legal effect on its face and thereby be bound to an estoppel giving effect to different, and hidden, legal consequences of that instrument. That may theoretically be possible, but I think there would have to be a much more explicit understanding between the parties about the potential for such hidden features to exist before such an estoppel would be enforced.
15. Nor do I think the questions about whether Mr Crowe was authorised to use the side yard as he did can be resolved as readily as counsel suggests. Given the conclusions I have reached, it is not necessary to consider those questions further.

Promissory estoppel and implied agreement

1. My factual findings similarly exclude the claim based on promissory estoppel. On the facts, the conduct of the Church Trust prior to the completion of Mr Crowe's works did not amount to a promise to Mr Crowe even that he could continue to occupy the side yard under the terms of the 1963 Lease, much less that he could do so for as long as he wanted. Nor am I satisfied that there was any detrimental reliance by Mr Crowe upon any such promise.
2. As to the claim based on implied agreement, I have already stated that on the facts the Church Trust made no promise to Mr Crowe that he was entitled to occupy the Leased Area for as long as he chose to do so. This does not exclude the possibility that the Trust could, by its conduct, have implicitly granted Mr Crowe a short-term entitlement to use or occupy the side yard. I return to that question below.

Trespass by structures erected in side yard

1. I have rejected Mr Crowe's claim to occupy the side yard in future. As already mentioned, subject to his claims for compulsory transfer of, or easements over, defined parts of the side yard, it appears to be common ground that he will have to vacate and no injunction against his continued occupation is necessary.
2. The principal relief sought by the Church Trust was a mandatory injunction compelling Mr Crowe, at his own expense, to remove the deck and also to remove the slab, balcony, and roof overhang to the extent they projected into or onto number 35 (I will refer to these collectively as the "Structures"). Alternatively, a declaration was sought that the Church Trust was entitled itself to remove the Structures and then to be reimbursed by Mr Crowe for its reasonable expenses of doing so. Alternatively, the Church Trust sought damages (a claim for exemplary damages was not pressed).
3. The Church Trust's claim was pleaded in nuisance as well as trespass. However, counsel for the Church Trust appeared to accept that for practical purposes the nuisance claim added nothing to the trespass claim, and did not present any separate argument on it. In what follows, I will therefore deal only with the claim in trespass. But as will appear, discussion of the principles which apply to trespass has involved some comparison with nuisance.
4. Four points were raised by counsel for Mr Crowe in opposition to the trespass claim. First, counsel contended that Mr Crowe had been licensed, at least implicitly, by the Church Trust to erect the Structures, and accordingly there was no trespass. Second, so far as the original construction of the deck, and the construction of the slab, the balcony and the roof overhang were concerned, the Church Trust's action was statute barred. Counsel's third contention was that, even if there was an actionable trespass, injunctive relief should be refused, and the Church Trust should be left to its remedy in damages. Fourth, counsel contested the quantum of damages claimed by the Church Trust.

Licence

1. Counsel for Mr Crowe did not contend, as part of his defence, that he had an indefinite licence. The contention was limited to saying that Mr Crowe had a licence which could be terminated by the Trust on short notice. The point was that at the time Mr Crowe undertook his works in the side yard, no such notice had been given by the Trust. Thus, the defence ran, Mr Crowe's conduct was not trespassory at the time.
2. On this contention, it was of course open to the Trust to terminate the licence now (if it had not already done so by its conduct since 2019). Under the doctrine of "continuing trespass" discussed below there might then be an obligation to remove the structures Mr Crowe had erected, which, if not complied with, would make their continued presence a trespass. The implications of this were not pursued in the parties' submissions, and, owing to the view which I have formed, do not need to be addressed.
3. The licence defence was put in two alternative ways. One contention was that the Church Trust had, by its conduct, tacitly agreed to Mr Crowe occupying the side yard. I have rejected the contention that the Church Trust, as a result of its conduct in 2009-2010, effectively granted Mr Crowe an indefinite licence to occupy the Leased Area in accordance with the 1963 Lease. But the present contention was put differently, and on a wider temporal basis. It covered the Church Trust's conduct over the whole of the period after Mr Crowe purchased number 33 in 2003, at least up to the correspondence from 2019 onwards which resulted ultimately in these proceedings.
4. The other contention did not depend on the conduct of either party. Rather, it was an argument that Mr Crowe, as Mr Gyngell's successor in title, was entitled, by operation of law, to enforce the 1963 Lease against the Church Trust, as Miss Turkington's successor in title. It was not contended that the Lease could operate indefinitely. Rather, it was accepted that it would only take effect on a month-to-month basis.
5. If this contention is correct, the licence in question came into existence upon the conveyance of number 33 to Mr Crowe in 2003. It is logical to deal with it first.
6. Licence arising between successors in title to parties to 1963 Lease: The contention, as pleaded, involved four steps. The first was that the 1963 Lease was binding on the Church Trust as successor in title to Miss Turkington by reason of CA s 118(1). That enactment relevantly provides: The obligation of a covenant entered into by a lessor with reference to the subject-matter of the lease shall, if and as far as the lessor has power to bind the reversionary estate immediately expectant on the term granted by the lease, be annexed and incident to, and shall go with that reversionary estate, or the several parts thereof, notwithstanding severance of that reversionary estate, and may be taken advantage of and enforced by the person in whom the term is from time to time vested by conveyance, devolution in law, or otherwise, and if and as far as the lessor has power to bind the person from time to time entitled to that reversionary estate, the obligation aforesaid may be taken advantage of and enforced against any person so entitled.
7. CA s 118(1) operates in favour of a person in whom a lease term is "vested". In terms, the 1963 Lease did not provide that the demise for which it provided would pass to Mr Gyngell's successors in title as owners of number 33. But the argument was that it implicitly so provided. This was the second step.
8. The third step sought to address the difficulty with the term of the Lease to which I have already referred. On its face, the Lease provided that the demise would continue indefinitely, unless terminated by the tenant. This was not possible, but the argument was that it could still take effect as a lease terminable by either party on one month's notice.
9. The argument recognised that a registrable lease which had not been registered would be defeated upon a new owner becoming registered as the proprietor of the subject land. This led to the final step, which was that the lease arising under s 118(1) did not require registration, because the term was less than three years: RPA s 42(1)(d).
10. On several occasions in the course of submissions, counsel for Mr Crowe deferred the presentation of submissions in support of this contention, saying that it would be articulated in full at a later stage. I must say that it was far from clear to me at the end of counsel's submissions whether this had been done. However, the contention was not formally abandoned either and I will deal with it, albeit briefly.
11. In my view, the fundamental difficulty with the contention is that it focuses exclusively on the 1963 Lease, and takes no account of the variations effected by the 1966 Lease. One of those variations altered the term of the 1963 Lease so as to specify a fixed term of 99 years. Clearly, no difficulty with that 1966 Lease would have arisen on the ground that the term was indefinite, but equally clearly, to be effective, the 1966 Lease had to be registered, and the exception in RPA s 42(1)(d) did not apply. It accordingly ceased to have any effect as an actual, or potential, interest in land when the Church Trust became the registered proprietor of number 35 in 1974.
12. It follows that, in my view, it is not open to Mr Crowe now to seek to resurrect an earlier form of the Lease and apply CA s 118(1) to it. Any potential rights in connection with s 118(1) under the 1963 Lease, as a stand-alone instrument, disappeared when it was varied in 1966. It is therefore unnecessary to consider the other steps in the contention.
13. Licence arising by implication from the parties' conduct: Mr Crowe's alternative contention was based on the Church Trust's inaction in the face of his continuous occupation of the side yard between 2003 and 2019. During that period, Mr Crowe (with the help of the tradesman who assisted him) erected the Structures. Over the years he also carried out smaller maintenance tasks and generally treated the side yard as his own recreational area. At no time did he try to conceal what he was doing.
14. Counsel for Mr Crowe pointed out that his activities in the side yard would clearly have been visible from the retirement village (see the photograph at [110] above). Furthermore, the Church Trust had direct knowledge from 2009 onwards that Mr Crowe was occupying the side yard and using it as his own. Counsel submitted that the proper inference to be drawn in these circumstances was that the Church Trust was content for Mr Crowe's activities to continue, thus impliedly licensing them: Permewans (Walgett) Pty Ltd v Morrison [1966] 2 NSWR 32 at 35-36 and the cases there cited.
15. Furthermore, after receiving Mr Crowe's letter of December 2009, the Church Trust was aware of the 1963 Lease, and that Mr Crowe was contending that it still "existed". Inaction by the Church Trust after that date, in counsel's submission, amounted to an implicit licence which specifically picked up the terms of the 1963 Lease (albeit as a licence terminable at will or on a month-to-month basis).
16. In my opinion, inaction on the part of the Church Trust between 2003 and 2009 did not amount to some sort of implied licence for continued occupation by Mr Crowe. It may be accepted that Mr Crowe's activities in the side yard would have been visible from the retirement village, and anyone who had a plan or survey showing where the boundary lay would have been able to see that he was occupying part of the Church Trust's property. But there was no evidence that any of the office holders or executives of the Church Trust who were responsible for managing its properties were aware, directly or indirectly, of what Mr Crowe was doing. In the absence of such awareness, no licence could arise by implication.
17. The circumstances however changed with Mr Crowe's approach to the Church Trust to buy the Edward Street frontage of number 35, or at least the side yard, and Mr Lawlor's visit to the property in June 2009. Mr Crowe's description of that visit ([174] above) was not disputed, so far as it went. Having seen the side yard and heard Mr Crowe's description of using and maintaining it, Mr Lawlor cannot have been in any doubt that Mr Crowe was treating the side yard as an extension of his house and intended to continue to do so.
18. Mr Lawlor may not have been aware at the time of his visit where the boundary between number 33 and number 35 lay, but if he was not, he would have become aware, at the latest, when he received the proposed subdivision survey plan for number 35 in September 2009 ([120] above), that the side yard was part of the Trust's land. Mr Lawlor's failure to object, knowing that Mr Crowe intended to maintain and use the land, amounted to a tacit approval for those activities to continue. In effect, through Mr Lawlor, the Trust consented to the continuation of that use for the time being, giving rise to a licence at will, as in the Permewans case.
19. If it matters, I do not think that this implied licence was exclusive. I see nothing in the circumstances to give rise to that additional feature. Certainly, the parties cannot have intended that the Church Trust's officers and invitees would (at least if they arranged their own access) be unable to attend the side yard for survey and other sale purposes.
20. Thus, at this point, although a licence had arisen by implication, it was only a bare licence and did not include any of the terms of the 1963 Lease. The possibility of incorporation of those terms into the implied licence could only have arisen once a copy of the lease was provided to the Trust in December 2009.
21. I do not think that any such implied incorporation can have occurred before the point at which the discussions between Mr Crowe and the Church Trust about purchase or lease petered out in mid-2010. It is true that Mr Crowe had, in his December 2009 letter, asserted the 'existence' of the 1963 Lease. And the evidence of the Trust's internal deliberations showed that by April it was proceeding on the basis of advice that the Lease was binding between it and Mr Crowe, if only on a month-to-month basis. But the present question must be determined according to an objective interpretation of the parties' outward conduct.
22. Outwardly, the only response from the Church Trust by mid-2010 had been to tell Mr Crowe in February 2010 that it was obtaining advice. As already noted, while the discussions about a sale or lease of Lot 202 continued, the 'existence' of the Lease was treated as a secondary matter. At the time the Trust's Property and Finance Board Sub Committee met in June, the executives of the Trust obviously considered that the discussions with Mr Crowe were still open (see [145] above). His lack of interest cannot have manifested itself until after that. For reasons already given, insufficient time had passed by then for the Trust's silence to be interpreted, objectively, as some sort of acceptance of the terms of the Lease.
23. But once the sale discussions had petered out and it was clear that Mr Crowe would not be pursing the purchase or lease of the side yard, the position changed. It does not matter that, on my findings, Mr Crowe did not actually believe that the lease gave him rights in accordance with its terms. Outwardly he was continuing to use the side yard as he had in the past, and had asserted the 'existence' of the Lease, which was consistent with such use.
24. Once the possibility of sale had fallen away, it was still outwardly necessary to allow a sufficient period of time for the Trust to investigate the 'existence' of the Lease. For reasons already given, the period would have been several months at least. But eventually further inaction on the part of the Trust can, I think, be objectively understood as an implicit acceptance that the Trust was content for Mr Crowe to continue, until further notice, to use the side yard in accordance with the terms of the Lease.
25. To this point, I have concluded that the Church Trust implicitly granted a licence to Mr Crowe over the side yard, in two stages. From June 2009 (or, at the latest, September) it was a bare licence at will. From some point in the second half of 2010 or the first half of 2011 (say) it had become a licence at will on the terms of the 1963 Lease. The next question is whether this licence permitted Mr Crowe to erect the Structures in the side yard so as to provide a defence to the Church Trust's claim in trespass.
26. Counsel for Mr Crowe contended that it did. Counsel submitted that, once it was accepted that Mr Crowe held an implied licence to occupy the side yard, which counsel contended was exclusive, he was entitled to undertake any lawful activity there, including the building of permanent structures: Kosciusko Thredbo Pty Ltd v Commissioner of Taxation (1987) 168 CLR 147 at 161; see also P Butt, Butt's Land Law (7th ed, 2017, Thomson Reuters) at [7.680]. It might be necessary to remove the structure on termination of the licence, but that was another question.
27. The case law on which counsel for Mr Crowe relied concerned lessees. Lessees, by virtue of their leasehold interest, have possession of the land, which gives them a special status. They cannot, even if holding over after the expiry of the lease, be treated as trespassers until ejectment has been obtained: J Eldridge and Ors, Fleming's Law of Torts (11th ed, 2024, Thomson Reuters) at [3.40]. If they damage the land while in possession, they can only be sued in an action for waste, and then only for damage to the reversion (which was what the High Court was talking about in the Kosciusko Thredbo case).
28. A licence, even if it is an exclusive licence, is something less. It does not confer possession. In my view, there is no reason to treat a licensee as being, by virtue of that status, automatically entitled to exercise any and all rights associated with legal possession. A right to build on the land may be conferred on the licensee, expressly or impliedly. But in my view, it is always necessary to ask whether that right in fact falls within the licence granted in the particular case.
29. In my view, to say that the bare licence which arose in June (or at the latest, September) permitted Mr Crowe to erect permanent structures in the side yard is an unlikely implication. All I have found to have arisen was a licence at will while a survey was obtained and the question of the land being sold by the Church Trust was worked out. As already noted, during this period Mr Crowe did not claim to have erected any such structures and there was no reason why Mr Lawlor, during his visit in June 2009, should have thought that Mr Crowe (or his predecessors in title, going back to the acquisition of number 35 by the Church Trust) had necessarily done so.
30. On my findings, Mr Crowe never told the Church Trust executives with whom he was dealing about the works he undertook in the side yard in 2009-2010. According to his December 2009 letter, his past activities had only involved using and maintaining it. I think that, in the circumstances, the implied licence which arose in 2009 was confined to continuing activities of that type.
31. It follows that the licence-implied-from-conduct contention cannot support a defence to the Church Trust's trespass claim so far as that claim concerns the Structures erected in 2009-2010. On my findings, those works were undertaken and completed while the implied licence in its initial form was still in place.
32. By the time Mr Crowe constructed the replacement deck in 2019, the implied licence incorporated the terms of the 1963 Lease. As I understood counsel for Mr Crowe's argument, he would contend that the incorporation of those terms would mean that the replacement deck construction was licensed.
33. On balance, I do not think so. The tenant's obligations under the 1963 Lease were to "maintain" and "keep" the garden "in order" and not to remove trees (cll 2(2) and 2(3)) (above [68]). In my opinion, this did not permit the tenant to go so far as to erect the extensive permanent deck constructed in 2019 (contrast the revised version of cl 2(4) in the 1966 Lease (above [71]), which expressly did).
34. In passing, it may be noted that had Mr Crowe's defence been based on an implied lease (the other possibility considered in the Permewans case), rather than an implied licence, a different analysis might have been available. An implied lease was not however pleaded in Mr Crowe's defence (or at least not clearly pleaded). Had it been, although trespass would not have been maintainable, a claim for waste or for breach of covenant might have been. As it is, no further discussion on the question is necessary.

Limitation

1. The limitation period prescribed for actions in trespass is six years from the date the cause of action first accrues: Limitation Act 1969 (NSW), s 14(1)(b). Because trespass is actionable without proof of damage, the cause of action accrues when the trespass occurs.
2. Counsel for Mr Crowe submitted that, as a result, any action for trespass involved in erecting the Structures in the side yard in 2009-2010 was statute barred. Counsel did accept that this defence did not apply to the refurbishment of the deck in 2019 (or the replacement of the treads on the upper stair, but no trespass claim was ultimately pursued for that).
3. Counsel for the Church Trust sought to meet this by relying on the doctrine of "continuing trespass". The doctrine is described in Fleming at [3.40] (emphasis added): If a structure or other object is placed on another's land, not only the initial intrusion but also failure to remove it constitute an actionable wrong. There is a "continuing trespass" as long as the object remains, and on account of it both a subsequent transferee of the land may sue and a purchaser of the offending chattel or structure be liable, because the wrong gives rise to actions de die in diem until the condition is abated. Likewise, if the chattel was initially placed on the land with the possessor's consent, termination of the licence creates a duty to remove it, and it seems that, according to modern authority, a continuing trespass is committed by failure to do so within a reasonable time. In all these cases, the plaintiff may maintain successive actions, but, in each, damages are assessed only as accrued up to the date of the action. This solution has the advantage to the injured party that the statute of limitations does not run from the initial trespass, but entails the inconvenience of forcing the plaintiff to institute repeated actions for continuing loss.
4. Counsel for Mr Crowe replied that the cases showed that "continuing trespass" did not operate in this way in a case, such as the present, where the trespass involved the erection of permanent structures. Immediately after the passage which I have quoted above, the following appears in Fleming: The doctrine of "continuing trespass" applies only to omissions to remove something brought on the land and wrongfully left there, not where a defendant fails to restore the land to the same condition as the defendant found it, as where the defendant digs a pit in the neighbour's garden and fails to fill it up. Here the plaintiff can only treat the initial entry as trespass and must be content with one action in which damages are recoverable for both past and future loss.
5. The issue thus requires some consideration of the case law.
6. In support of the first two sentences in the first passage from Fleming, the authors cite Hudson v Nicholson (1839) 5 M & W 437, a decision of the Court of Exchequer. In this case, the plaintiff and defendant owned adjoining properties. The plaintiff complained about "shores and timbers" which had been driven into his land and supported a building on the defendant's land. He alleged that he had asked the defendant to remove the shores but he had failed to do so. Being unable, as he alleged, to remove and take away the shores himself, without the defendants' building collapsing on his land, he alleged that he had been hindered and prevented from developing the land and deprived of rents and profits which he would have derived from doing so. He obtained a judgment in his favour at trial.
7. On review by the Court in banco, the defendant's case was that the shores had not been installed by him, but by their predecessor in title. The plaintiff therefore had no remedy against him. Alternatively, the action should have been framed in trespass rather than as an action on the case for damages (as to this distinction, see Fleming at [3.40]).
8. The defendants' contentions were rejected. Lord Abinger CB, who gave the leading judgment, stated (ER at 188-189, emphasis added): I … adhere to the opinion that this is properly the ground of an action of trespass, and not of case. It is not similar to those cases that have been cited, of trespass to a personal chattel, where trespass and case are concurrent remedies, and where a party may waive the trespass and go for the consequential damage; as for instance in the case of an asportation of goods, where trover may at all times be maintained. … those cases contain distinct causes of action, and are not analogous to an action brought for a trespass to the soil, which is continued. The whole of this declaration shews that these timbers were put into the soil of the plaintiff for the purpose of supporting the defendant's house, and they were continued there [446] by the defendant himself, rendering him substantially a trespasser, as much as if he had stuck a pole in the land of the plaintiff. It is specially assigned as ground of complaint that the plaintiff could not remove the shores without pulling down the defendant's house; but it is for the defendant to shew that his house would be thereby injured. I think, therefore, that this is substantially a trespass. His Lordship, however, considered that the use of the wrong form of action was irrelevant once judgment had been obtained.
9. At the end of the second passage from Fleming quoted above, the authors cite Clegg v Dearden (1948) 12 QB 576, a decision of the Court of Queen's Bench, as authority for the proposition that continuing trespass does not apply to a failure to restore the plaintiff's land to its pre-trespass condition. The defendant in that case was the owner of a coal mine. In December 1835, he trespassed into a coal mine on his neighbour's land, excavating coal and leaving a large aperture through which the neighbouring mine suffered flooding. Later, the neighbour transferred title to the mine. Later still, in 1841, the plaintiff asked the defendant to restore the excavated area and stop up the aperture, the defendant did not do so and the flooding continued. The question was whether the plaintiff could sue for the continued flooding which had resulted from the trespassory works undertaken by the defendant before the plaintiff had become the owner of the land in question.
10. The plaintiff's action failed. Lord Denman CJ, who gave the leading judgment, said (at 995): … the cause of action … is the not filling up the excavation made by him on the plaintiffs' side of the boundary and within their mine. It is not, as in the case of Holmes v Wilson (10 A & E 503), a continuing of something wrongfully placed by the defendant upon the premises of the plaintiffs; nor is it a continuing of something placed upon the land of a third person to the nuisance of the plaintiffs …. There is a legal obligation to discontinue a trespass or remove a nuisance; but no such obligation upon a trespasser to replace what he has pulled down or destroyed upon the land of another, though he is liable in an action of trespass to compensate in damages for the loss sustained. The defendant, having made an excavation and aperture in the plaintiffs' land, was liable to an action of trespass: but no cause of action arises from his omitting to re-enter the plaintiffs' land and fill up the excavation: such an omission is neither a continuation of a trespass nor of a nuisance; nor is it the breach of any legal duty.
11. The situation in which chattels are placed by the defendant on the plaintiff's land was the subject of the judgment of the English Court of Appeal in Konskier v Goodman Ltd [1928] 1 KB 421. In that case the defendants left building waste from works they were undertaking on their property on a neighbouring property. This was done with the permission of the then owner of that property, but on condition that the building materials would be removed after the building work was finished, or after a reasonable time had elapsed. The property was then sold to the plaintiff. By this time the building work had finished, and (as the Court found) a reasonable time to remove the building materials had expired. The Court held that the plaintiff could maintain an action for trespass against the defendant as a result of the continued presence of the materials.
12. In Lord v McMahon [2015] NSWSC 1619, a decision of Slattery J in this Court, the defendant built a dam on his property in 2000, the embankment wall of which encroached onto the plaintiff's land. In 2013, the plaintiff brought an action alleging, among other things, that the construction of the wall was a trespass. Slattery J found that the plaintiff, by his conduct, had, when the embankment wall was built, implicitly consented to the original encroachment on his property. But the plaintiff nevertheless contended that consent had been withdrawn, making the presence of the embankment wall a continuing trespass.
13. His Honour rejected the continuing trespass claim. He discussed the decisions in Konskier and Clegg and continued (at [163]-[164]): How do these principles apply here? Could what was not a trespass in 2000 have become a continuing trespass later, because Mr McMahon did not remove the dam wall on Lot 2 at Mrs Lord's request? In my view, the answer is in the negative. Mr McMahon's initial conduct was not the leaving of some movable item on the surface of lot 2. He effected a permanent alteration to the surface of the land of Lot 2 which could only be restored by his returning onto Lot 2 and removing the dam wall (and no doubt at the same time shifting the position of the dam on Lot 3). This case does not involve the leaving of anything like chattels on Lot 2. The earth spoil Mr McMahon placed on Lot 2 was compacted into and changed the surface of Lot 2. The compacted material thereby ceased to be distinguishable from the surface of the land and ceased to be a readily removable chattel, owned by the defendant Mr McMahon, if it ever had that quality. Once it was compacted into the land the material that had been transported onto Lot 2 became part of the real property to which Mr Lord and later Mrs Lord had title. This case is therefore not analogous to Konskier. The principle in Clegg is directly applicable here. No continuing cause of action in trespass arises from Mr McMahon's failure on a daily basis to re-enter Lot 2 and remove the compacted material that he placed there. It makes little sense here to speak, as it did in Clegg, of "a legal obligation [on a trespasser or on a person who becomes a trespasser by the effluxion of time] to discontinue a trespass", when such an obligation can only be discharged by changing the land itself again by removing something, which is now the property of Mrs Lord not Mr McMahon.
14. In Lakes Edge Developments Ltd v Kawarau Village Holdings Ltd [2017] 3 NZLR 336, a similar issue arose. The case concerned rock anchors constructed under the surface of adjoining properties. At the time the anchors were constructed the properties were in separate ownership but under common control. Control of one of the properties changed and the new owner brought an action for trespass against the neighbouring owner, alleging that, while the initial installation of the rock anchors had been licensed, the licence had been withdrawn and the continuing presence of the rock anchors gave rise to a trespass.
15. The New Zealand Court of Appeal concluded that any licence could not be countermanded and no trespass arose as the rock anchors were fixtures which were part of the land and had been installed with the consent of the then owner. The Court referred to several English and Australian authorities in support of that conclusion.
16. In McIntosh v Morris [2021] NSWCA 225 the parties were the registered proprietors of adjoining land. Before the defendants purchased their property, the previous owners laid pipes for stormwater and an electrical conduit that encroached on the plaintiff's land. After the defendants purchased from the previous owner, the plaintiffs sued them for trespass by reason of the encroachment. The claim was resolved without the need for a trial, but the defendants were ordered to pay the plaintiff's costs on the basis of previous offers in correspondence which had not been accepted.
17. The case thus did not directly involve an issue of trespass. But in the course of his reasons, White JA, with whom Emmett AJA agreed, said at [74]: The pipes and other alleged encroachments became fixtures in the respondents' land. This is not the occasion to decide issues as to the law of continuing trespass where the defendant was not the party responsible for the encroachment and the encroachment had become part of the plaintiff's land. It is strongly arguable that, at least if the original laying of the pipes were not trespassory, because the pipes and other encroachments become fixtures on the respondents' land, the applicants were not liable in trespass for failing to remove them (Lakes Edge Developments Ltd v Kawarau Village Holdings Ltd [2017] 3 NZLR 336 at [41], [58]-[60]; Lord v McMahon at [160]).
18. In his concurring judgment, Brereton JA referred to a number of authorities, including Lord v McMahon and Lakes Edge Developments, concluding at [107]: In my judgment, those cases - in particular Lord, a decision of the Supreme Court - placed considerable obstacles in the way of the respondents' success. The pipes were no longer chattels but had become incorporated in the respondents' land upon installation. They were not a movable item on the surface of the respondents' land, but could only be restored by the applicants entering onto the respondents' land and excavating them. They were a permanent alteration to the land. They had ceased to be a readily removable chattel distinguishable from the land. Whether their original installation was consensual or trespassory, there was no longer anything belonging to the applicants on the respondents' land.
19. In Kalgovas v Iliopoulos [2022] NSWSC 70, the parties were neighbours. The plaintiffs sued the defendants over excavation and other works, including the construction of a dry-stone retaining wall, which had allegedly had the effect of removing or supporting the support provided by the defendant's land to the plaintiff's land which in turn had allegedly resulted in damage to structures on the plaintiff's land which became apparent in 2014. The proceedings were commenced in 2015 but the works themselves had been carried out in the 1980s. The plaintiffs sought to meet this by relying upon the doctrine of continuing trespass.
20. At [89], Darke J said: It is doubtful whether the existence of the encroaching elements of the dry stone retaining wall, which are fixtures in and thus part of the plaintiffs' land, amount to a continuing trespass (see, for example, [Lord v McMahon] at [160]-[161] per Slattery J; [McIntosh v Morris] at [74] per White JA and [102] and [104]-[107] per Brereton JA). I tend to think that there is no continuing trespass, and that any cause of action to sue for any trespass that occurred in about 1983 is statute barred.
21. Of these cases, only Lord v McMahon and Kalgovas directly address limitation. Nevertheless, the proposition that, in general, trespassory earthwork or building work undertaken entirely within or on a plaintiff's land do not give rise to a continuing trespass seems well established. The boundary between chattels and fixtures in land law may not exactly define the boundary between continuing and non-continuing trespass, but it seems that usually it will be a reasonable guide.
22. It also seems to me that the proposition is consistent with principle, at least in a limitation context. Everyone agrees that if the defendant makes a transitory incursion into the plaintiff's land and damages a building on that land, for instance by breaking a window, then the cause of action accrues, for limitation purposes, at the latest when the transient entry into the land ceases. Why should it be different if, instead of breaking a window, the defendant damages the land itself by digging a hole and filling it with concrete?
23. The first passage quoted above from Fleming may therefore go too far in saying that the trespassory placement of "a structure" on the plaintiff's land gives rise to a continuing trespass. If that statement is understood as extending to the erection of a stand-alone fixture entirely within the boundaries of the plaintiff's land, it is contrary to the proposition which I have identified.
24. Applying the proposition to the facts of the present case, I think it is clear that any action for trespass based on the construction of the deck in 2009-2010 is statute barred. As already noted, however, this does not apply to the reconstruction of the deck in 2019, which appears for practical purposes to have been a complete replacement of the previous deck.
25. The slab under the balcony appears to have been laid as a single piece of concrete. The portion on number 35 does not appear to derive any support from the portion on number 33, nor vice versa. Accordingly, any action for the construction of that part of the slab on number 35 is also statute barred. The Church Trust is of course free to remove that part of the slab at its own expense.
26. On the other hand, I think that the roof overhang is clearly a continuing trespass. The overhang is part of Mr Crowe's house. It is only the continuing support from the walls and roof of the house which keeps it in its trespassory position. It is not a fixture which the Church Trust owns as a result of its ownership of the land on number 35.
27. This leaves the balcony. Considered on their own, the supporting poles might be fixtures forming part of the land on number 35. But the balcony which they support also receives support from the extensions to Mr Crowe's house; if that support were removed the balcony would collapse.
28. Counsel did not specifically address me on the classification problem which arises. I have therefore dealt with it as a matter of principle. The starting point is, I think, that the balcony and its supports should be treated as a single structure. That is evidently the way it was conceived and built by Mr Crowe.
29. The closest case seems to me to be Hudson, which was not referred to in Lord v McMahon. The facts are not exactly the same. In Hudson, it was the defendant's land which was deriving support from the structure on the plaintiff's land. In the present case it is the other way around. But, as in Hudson, the trespassory structure here is connected with, and ancillary to, a building belonging to the defendant. The continued use of the house on number 33 to support the balcony structure should similarly be seen as a continuing trespass: see also Holmes v Wilson (1839) 10 Ad & El 503; 113 ER 190.

Injunction

1. To this point, I have concluded that the presence on the Church Trust's land of the deck (as reconstructed in 2019), the roof overhang and the balcony (the latter two, subject to Mr Crowe's application under EBA s 3) constitute actionable trespasses. Counsel for Mr Crowe submitted however that the mandatory injunction sought by the Church Trust should still be refused. Counsel advanced two arguments.
2. Counsel's first argument was that damages are an adequate remedy (or at least have not been shown to be inadequate). The second was that the circumstances (in particular, the cost to Mr Crowe, which was said to be disproportionate to any harm caused by the continuation of the trespasses) are such as to make the grant of an injunction inappropriate. Instead, the Church Trust should be left to its remedies in damages (which, counsel submitted, would be minimal).
3. Counsel's arguments began with the "good working rule" governing the grant of damages in lieu of an injunction which was proposed by AL Smith LJ in Shelfer v City of London Electric Lighting Company [1895] 1 Ch 287 at 322-323: (1) If the injury to the plaintiff's legal rights is small, (2) And is one which is capable of being estimated in money, (3) And is one which can be adequately compensated by a small money payment, (4) And the case is one in which it would be oppressive to the defendant to grant an injunction:- then damages in substitution for an injunction may be given.
4. Counsel acknowledged that the "rule" had been adopted in the Australian case law and remained current. But in developing his first argument, counsel submitted that it was necessary to have regard to other recent strands of authority.
5. In this regard, counsel referred in particular to the decision of the High Court in Bankstown City Council v Alamdo Holdings Pty Ltd (2005) 223 CLR 660. That was a case in which the defendant council had undertaken drainage works which increased the risk and severity of flooding to the plaintiff's land. The plaintiff obtained a mandatory injunction requiring the council to undertake rectification works.
6. In the High Court, the case turned on a statutory provision which exempted the council from liability where it had acted in good faith. The Court held that the provision applied, so that the plaintiff's case failed. But in the course of its judgment, the Court noted at [11]-[13] the "curiosity" that, despite the fact that the plaintiff's only claim for damages was a claim for diminution in the rental value of the land, and there was ample valuation evidence before the trial judge on the question, the order for a mandatory injunction had been made in the first place.
7. Counsel then referred me to the subsequent statement by Young CJ in Eq in Owners Strata Plan 4085 v Mallone [2006] NSWSC 1381, a case involving a nuisance created by rocks falling from the defendant's land, that the Alamdo decision sounded a "clear warning that it is inappropriate to grant injunctions in the auxiliary jurisdiction where damages are able to be ascertained and where they are adequate". Counsel submitted that the present case was likewise a claim for relief in the auxiliary jurisdiction, that is, a claim for an injunction in aid of the plaintiff's action for trespass at law.
8. Counsel submitted that damages could readily be assessed in the present case. In counsel's submission, this was so notwithstanding the fact that the damages might be small or even nominal.
9. So far as the balcony and the roof overhang, in particular, were concerned, counsel submitted that the presence of these structures caused no prejudice to the Church Trust based on the present use of number 35. Counsel submitted that at present there was no real prospect that any development would be undertaken, but submitted that "if circumstances change, and [the Church Trust] or a later owner is in a position to progress a development that requires removal of the balcony and roof overhang, the issue may be taken up at that point in time".
10. Counsel's second argument took, as its starting point, the well-known decision of the House of Lords in Redland Bricks Ltd v Morris [1970] AC 652. The defendant company had excavated its land and the excavations, over time, filled with water producing an "artificial lake" near the border with the plaintiff's adjoining land, which the plaintiff used as a market garden. The plaintiff's land was gradually being undermined by the presence of the lake. A mandatory injunction was granted requiring the defendant to take restore support to the plaintiff's land. Compliance with that injunction would have involved the defendant incurring very large costs, whereas the actual loss suffered by the plaintiff was quite modest in comparison. The House held that a mandatory injunction should not have been granted.
11. Counsel contended that the same was true in the present case. Counsel submitted that the jurisdiction to award a mandatory injunction was one to be exercised sparingly, and only where the plaintiff shows a very strong probability on the facts that grave damage will accrue in the future. If this condition was satisfied, a mandatory injunction would be more likely granted in a case where the defendant had acted "wantonly or unreasonably" and less likely where the defendant had "acted reasonably, though in the event wrongly". Counsel submitted that the latter characterisation was the appropriate one in the present case.
12. It is convenient to deal with counsel's arguments first by reference to the roof overhang and balcony together. I will then address the deck, which gives rise to somewhat different considerations.
13. Roof overhang and balcony: On one view, counsel's first argument is answered simply as a matter of authority. As counsel acknowledged, Shelfer remains authoritative, even if, as a "good working rule", it does not necessarily apply in its precise terms in every single case. It was so treated by the Court of Appeal for England and Wales in Jaggard v Sawyer [1995] 1 WLR 269 and also by the Victorian Court of Appeal in Break Fast Investments Pty Ltd v PCH Melbourne Pty Ltd (2007) 20 VR 311, a decision on which counsel for the Church Trust strongly relied. The rule requires four conditions to be satisfied before an injunction will be refused. One (condition two) is that the injury to the plaintiff's legal rights is "one which is capable of being estimated in money". This covers similar ground to the adequacy of damages. But other conditions require that the injury is "small", the damages are "small", and the grant of an injunction would be oppressive to the defendant. Adoption of counsel's argument would effectively result in jettisoning some, or all, of these further conditions.
14. Be that as it may, I think that counsel's argument also faces fundamental doctrinal difficulties. To see why, it is necessary to put the decision in Shelfer and the subsequent case law in context.
15. The application for the injunction in Shelfer was made pursuant to Lord Cairns' Act (Chancery Amendment Act 1858 (21 & 22 Vict c 27) reflected in s 68 of the Supreme Court Act 1970 (NSW)), which had then been only relatively recently enacted. The historical context was described by Millett LJ in Jaggard, at 204 (see, also, to similar effect, Bingham MR at 196-197): The principal object of Lord Cairns' Act is well known. …. It was to enable the Court of Chancery, when declining to grant equitable relief and leaving the plaintiff to his remedy at law, to award the plaintiff damages itself instead of sending him to the common law courts to obtain them. From the very first, however, it was recognised that the Act did more than this. The jurisdiction of the Court of Chancery was wider than that of the common law courts, for it could give relief where there was no cause of action at law. …. In Eastwood v Lever (1863) 4 De GJ & S 114 at 128, 46 ER 859 at 865 [Turner LJ] pointed out that the Act had empowered the courts of equity to award damages in cases where the common law courts could not. The Act, he said, was not 'confined to cases in which the Plaintiffs could recover damages at law'. Damages at common law are recoverable only in respect of causes of action which are complete at the date of the writ; damages for future or repeated wrongs must be made the subject of fresh proceedings. Damages in substitution for an injunction, however, relate to the future, not the past. They inevitably extend beyond the damages to which the plaintiff may be entitled at law. In Leeds Industrial Co-op Society Ltd v Slack [1924] AC 851, [1924] All ER Rep 259 the House of Lords confirmed the jurisdiction of the courts to award damages under the Act in respect of an injury which was threatened but had not yet occurred. No such damages could have been awarded at common law.
16. In Shelfer, the plaintiffs were the lessee and the reversioner of property near the defendant's electricity works. The operation of the works produced vibrations and noise which interfered with the enjoyment of the plaintiffs' property and caused, or at least had the potential to cause, physical damage to it, amounting to an actionable nuisance. The English Court of Appeal held that the trial judge had been wrong in refusing an injunction against the defendant and remitting the plaintiffs to their entitlements to damages.
17. The approach taken by the Court was that the plaintiff was presumptively entitled to an injunction, and the question was whether he should be deprived of that remedy and only damages awarded instead. All of the members of the Court emphasised that, in general, an award for damages under Lord Cairns' Act should not be used as means to allow the landowner to compulsorily acquire the interest of the landowner. The same approach was taken by the Victorian Court of Appeal in Break Fast: see at [36]-[91].
18. The historical context, as described in Jaggard, explains why this distinctive approach was, and still is, taken. Where an application is made for an injunction, and it is suggested that damages should be awarded instead, the case is not within equity's auxiliary jurisdiction at all. In such a case, the plaintiff has no right at law to future damages. Any relief against future tortious conduct, whether by way of injunction or damages in lieu of that injunction pursuant to Lord Cairns' Act, lies in equity's exclusive jurisdiction.
19. Damages at law are generally awarded on a once-and-for-all basis. This is seen as meeting fundamental requirements of certainty and finality in litigation. There seems no reason why it should be different for an award of damages under Lord Cairns' Act.
20. It follows that I do not accept counsel's suggestion that if the balcony and roof overhang interfere with some later development the question of granting an injunction (or, presumably, awarding further damages) could be dealt with again at that time. If the Court is to award damages in lieu of an injunction, the damages must properly compensate the Church Trust from all loss that has or will suffer in future from the encroachments, including the possibility that they might interfere with future developments the Trust might wish to undertake.
21. I think this shows how different the present case is from Alamdo in its facts. In that case the damage, in the form of reduction in the letting value of the property, had already been suffered and could readily be assessed using valuation evidence. Counsel's suggestion of a later reconsideration is really a concession that that is not so here.
22. Alamdo is different for another reason as well. It was a nuisance case. An action in nuisance is an action on the case for damage (Fleming at [21.70]). Once the damage is suffered it must be assessed once and for all. But the Church Trust in the present case has an action for (continuing) trespass, which is actionable without proof of damage, and, as Millett LJ explained in the passage from Jaggard quoted above, requires a fresh action each time future damage occurs.
23. Indeed, there may be a question about whether the Court can actually impose an award of damages for future loss in lieu of an injunction on unwilling plaintiffs in a trespass action. Such plaintiffs can always bring an action at law for trespass. They cannot be forced to claim an injunction, and if they do not, the question of awarding damages in lieu cannot arise. Why then, if faced with a proposed refusal of injunctive relief and award of damages in lieu, could they not (perhaps at the risk of an adverse costs order) decline the award of future damages and reserve their right to bring a further action in future? But this question does not arise for decision in the present case and nothing more needs to be said about it.
24. For the reasons I have given, I do not consider that the Church Trust's damages for the trespass constituted by the roof overhang and balcony are "capable of estimation in money" for the purpose of the Shelfer "rule". If there is any additional requirement that damages be an inadequate remedy, I think it is satisfied.
25. On a literal reading of the Shelfer "rule", failure to satisfy the second condition means that damages should not be awarded in lieu of an injunction. But as the rule is not a completely rigid one, I will consider the other conditions.
26. As to the first condition, Mr Crowe, by building the overhang and the balcony has wrongfully appropriated part of number 35's land and airspace for himself. It is not a marginal intrusion, nor was it accidental. I do not see the invasion of the Church Trust's rights as "small".
27. As to the fourth condition, Shelfer, dealing with oppression of the defendant, was concerned with a prohibitory injunction rather than a mandatory one. Although the "rule" in Shelfer, as already noted, is expressed cumulatively, in the case of a mandatory injunction there may be a justification for giving the fourth condition more weight than the others. I will adopt that assumption in what follows.
28. The fourth condition covers the same, or similar ground, to counsel's argument based on the Redland Bricks decision. That decision is, I think, best seen as an application of the equitable defence of hardship; it is not the product of a specific rule about mandatory injunctions, although the question of hardship may tend to arise more acutely in such cases than in prohibitory injunction cases (cf J Heydon, M Leeming, P Turner, Meagher, Gummow and Lehane's Equity: Doctrines and Remedies (5th ed, 2015, LexisNexis Butterworths) at [21-465]).
29. As a defendant advancing an affirmative defence, the onus lies on Mr Crowe to establish hardship (and the same is effectively so under the application of the Shelfer approach). I do not doubt that there would be some cost to him in removing the balcony and the overhang. But, to the extent this is hardship, it is self-inflicted. On my findings, Mr Crowe was well aware that when he built the extensions that he was trespassing on number 35. I am not satisfied that in fact he had any belief that he was entitled to do so under the lease.
30. In my view hardship to Mr Crowe is of little if any significance. Whatever significance it may have, in my view, is clearly outweighed by the importance of vindicating the property rights of the Church Trust. A mandatory injunction will be granted.
31. Deck: On the face of it, the same reasoning applies to the deck. But on analysis there may be a short cut which simplifies matters.
32. The deck is it a fixture which is part of the Church Trust's land and belongs to the Church Trust. There is nothing to stop the Church Trust from retaining a contractor to remove it, and the cost of doing so would be readily calculable.
33. In the alternative to mandatory injunctions, the Church Trust has sought a declaration that it is entitled to remove the Structures, including the deck, and to recover the cost of doing so from Mr Crowe, together with an order for payment. Although this was not stated in so many words by counsel for the Church Trust, presumably the entitlement to recover the cost once the Church Trust has removed the Structure is an entitlement to damages in trespass. Damages based on the cost of restoring damaged real property to its former state are well known in the field of leasing: Tabcorp Holdings Ltd v Bowen Investments Pty Ltd (2009) 236 CLR 272.
34. Counsel for Mr Crowe argued that this relief was the same in substance as seeking a mandatory injunction. I cannot agree with this submission: the financial effect may effectively be the same if the removal is actually done by a contractor, but the two forms of relief, injunction and damages, are quite different legally. The important point for present purposes, however, is that counsel did not contest the entitlement to damages for trespass on this basis.
35. There is no need for declaratory relief. Rather than declare that the Church Trust is entitled to damages, the Court should simply assess and award them. For this purpose, it may be possible to make an award of damages before the work is done, assessed by reference to commercial removal costs: cf Tabcorp at [15]-[21]. If for some reason that is not possible, the award of damages can be deferred until the work has actually been done and the removal cost has been quantified.
36. On this analysis, damages would be an adequate (indeed, the preferable) remedy. There would be no call for an injunction and no need to debate the application of the Shelfer "rule" at all.
37. Mr Crowe, however, may prefer to do the work himself rather than incur, indirectly, the costs of having a contractor do it. If a suitable agreement can be negotiated between the parties, then orders giving effect to it could be made by consent.
38. In these circumstances, I think the appropriate course is to defer finalising this part of the claim to give the parties an opportunity to negotiate on the mechanics and costs of removal. If the parties cannot agree, then the matter can be the subject of supplementary evidence or, if necessary, an inquiry. There seems no reason why, if the parties wish, they should not proceed in the same way for the roof overhang and the balcony.

Quantum of damages

1. Given the conclusion I have reached, it is unnecessary to consider this issue.

Compulsory transfer or easement under EBA s 3

1. Mr Crowe's EBA application, as presented in final submissions, was for relief with respect to the roof overhang and the slab and balcony constructed in 2009-2010. These were defined in the orders sought as the "Encroaching Structures".
2. The most extensive form of relief sought by Mr Crowe was an order for compulsory transfer of part of number 35 to accommodate the Structures. The transfer sought was described as "fee simple interest in the land over which the Encroaching Structures extend". I understood this to be intended to include the airspace above, and the subsurface area below, the combined footprint of the Structures.
3. Alternatively, Mr Crowe sought a compulsory easement, described as an "easement for structures". The proposed easement would provide, in favour of number 33, for the Structures to remain in place; and for the owners of number 33, or persons licensed by them, to enter onto number 35 for the purpose of maintaining, repairing and replacing those Structures. But if the Structures were removed, the easement would have to be surrendered.
4. To this extent, the proposed easement reflected the standard terms for easements permitting roof overhangs and encroachments in CA schedule 8, parts 10 and 13. But it went further, including an additional right for the owners of number 33 and their licensees not included in the standard form easements. This was a right to use the slab and the balcony "for the purpose of recreation".
5. The key provisions are EBA ss 3(2) and (3) which relevantly provide: … (2) On the application the Court may make such orders as it may deem just with respect to: (a) the payment of compensation to the adjacent owner, (b) the conveyance transfer or lease of the subject land to the encroaching owner, or the grant to the encroaching owner of any estate or interest therein or any easement right or privilege in relation thereto, (c) the removal of the encroachment. (3) The Court may grant or refuse the relief or any part thereof as it deems proper in the circumstances of the case, and in the exercise of this discretion may consider amongst other matters: (a) the fact that the application is made by the adjacent owner or by the encroaching owner, as the case may be, (b) the situation and value of the subject land, and the nature and extent of the encroachment, (c) the character of the encroaching building, and the purposes for which it may be used, (d) the loss and damage which has been or will be incurred by the adjacent owner, (e) the loss and damage which would be incurred by the encroaching owner if the encroaching owner were required to remove the encroachment, (f) the circumstances in which the encroachment was made.
6. There was no evidence before me of the precise cost of removing the Structures, but it was common ground that the cost would be significant, and would run at least into the tens of thousands of dollars. Mr Crowe's valuer, Mr Lunney, assessed the loss of value to Mr Crowe, if the Structures had to be removed, at $500,000. Mr Gale did not disagree.
7. As already noted, for the purposes of the law of trespass, I do not think that part of the slab which extends onto number 35 is an encroachment. There was some debate between the parties as to whether all of the Structures were actually "encroachments" for the purposes of the EBA. But, in the view I take, it is not necessary to resolve this question and I will deal with the application on the assumption that all of the Structures are "encroachments" for statutory purposes.
8. For reasons for which I have given earlier, I have decided that Mr Crowe is liable in trespass for the continued intrusion of the roof overhang and of the balcony into the airspace of number 35. I have also concluded that the Church Trust is entitled to a mandatory injunction requiring Mr Crowe to remove those intrusions. Even if that were not the case, the Church Trust is entitled to remove the overhang and the balcony itself and to recover the reasonable cost of doing so as damages from Mr Crowe.
9. I have however concluded that the slab is in a different position. There is no ongoing liability in trespass for the presence of that part of the slab on Mr Crowe's land, although the Church Trust is entitled to remove that part of the slab, which is a fixture forming part of its land, at its own expense.
10. I propose to deal with the roof overhang and the balcony first. I will return to the slab when I have done so.
11. Roof overhang and balcony: The Court's power under EBA s 3(2) is not confined to making orders regularising encroachments by ordering the transfer of land, the grant of an easement, or the payment of compensation. It extends to orders for the removal of easements as well. In that regard, the statutory jurisdiction covers (perhaps, it was contemplated, summarily) the same ground as the Court's power to grant a mandatory injunction under the general law.
12. In the present case I have already fully considered, and determined to exercise, the Court's general law power to make mandatory removal orders. Given the nature of the power under EBA s 3, one might wonder whether it is necessary to go on and consider separately whether, having made that determination, I should now effectively reverse it under the Act.
13. However, the exercise of the statutory power was fully debated before me, and the debate took place by reference to authorities on the application of EBA s 3 and comparable interstate provisions. I therefore propose to address the arguments in those terms, although the principles laid down by the authorities for the exercise of the statutory power, may, in the end, differ little from the principles developed concerning the grant of mandatory injunctions in aid of claims for trespass.
14. On the principles to be applied, both parties referred me to the decision of Gibbs J in the Queensland Supreme Court in Haddans Pty Ltd v Nesbitt [1962] QWN 98. In that case his Honour was considering an application under the equivalent Queensland legislation, the Encroachment of Buildings Act 1955 (Qld). His Honour said (at 99-100): An initial question of considerable importance that arises in the present case is whether the applicant was aware that the fence that it caused to be built in 1960, in fact stood on the respondents' land, for it would be a rare and exceptional case in which the court would make an order under this Act in favour of a person who, with full knowledge, encroached on his neighbour's land. The court would indeed be reluctant to set the seal of its approval on a deliberate trespass.
15. Counsel for Mr Crowe accepted that, at the time he built the Structures, he knew, from the survey provided to him by the Church Trust, where the boundary was between number 33 and number 35, and therefore that he was building on number 35. Counsel urged me, however, to accept that he thought he was entitled under the 1963 Lease to do so. Counsel further submitted that the fact that years had gone by with no complaint about the encroachments from the Church Trust amounted to tacit acceptance (or at least disinterest) on its part, and this was relevant in the exercise of the discretion.
16. Counsel also relied on the later Queensland Supreme Court decision in Shadbolt v Wise [2002] QSC 348. In that case the plaintiffs built a swimming pool extending onto the defendant's land. They selected the site for the pool because it suited them and did not investigate where the boundary was.
17. Mullins J described the conduct of the plaintiffs as "arrogant" and "reckless" but considered that it did not amount to "full knowledge" for the purposes of the Haddans principle. She went on to consider the balance of hardship and made an order under the Act as sought by the plaintiffs. The defendant appealed but his appeal was dismissed: Shadbolt v Wise [2003] QCA 241.
18. Counsel for the Church Trust submitted, for their part, that Mr Crowe's actions were deliberate and quite unjustified. The extensions constructed by Mr Crowe, while "nice to have", had not been essential. The house could have been used perfectly well without them. Nor did the extensions have any heritage value; rather the reverse.
19. Counsel for the Church Trust also pointed out that, according to the planning evidence, the house, even in its altered form, met all applicable requirements for the amount of open space on the site. Thus, it could not be said that there was any need for further recreation areas in number 35. Counsel also submitted that it was relevant that no approval had been sought.
20. Counsel submitted that the Act was designed for "slight" encroachments and should not be used to allow Mr Crowe to appropriate part of the Church Trust's land against the Trust's will, even if he is prepared to pay compensation.
21. In reply, counsel for Mr Crowe did not deny that that his failure to obtain planning approval is to some extent relevant, but contended that it has little weight. Planning approval could not have been sought without the consent of the Church Trust as the owner of land on which the balcony and roof overhang were to encroach; effectively, therefore, the failure to obtain approval did not add anything to the failure to obtain the Church Trust's agreement in advance. In counsel's submission, the lack of approval should be left to the council to deal with, or for action by the Church Trust in the Land and Environment Court (it appears to be common ground that the Trust would have standing to seek a demolition order and such proceedings would not be statute barred).
22. The Act provides that the Court "may consider" the factors listed in EBA s 3(3); it is not obliged to consider each (or any) of those factors, and the extent to which it does is a matter of judgment for the Court. In that sense the list is not mandatory. Nor is it exhaustive. The Court's power under EBA s 3(2) has been described as "very wide" and "most ample": Llavero v Shearer [2014] NSWSC 1336 at [109].
23. In Haddans, Gibbs J said (at 102): It seems to me that one matter that must receive great weight in any doubtful case under this Act is the fact that the adjacent owner is the landowner from which the easement or other rights are sought by the encroaching owner. The Act does not appear to me to be designed to enable one landowner to acquire rights over the land of his neighbour against his neighbour's will without sufficient reason, even though it may be that a reasonable neighbour might have been prepared to sell those rights for a proper consideration.
24. I adopt the same starting point. There may be uncertainties about how the Edward Street frontage of number 35 can, or will, be used and developed by the Church Trust in future. But those uncertainties only highlight that the Court is being asked to deprive the Church Trust of its entitlement to use the land on which the Structures stand as it may see fit in the future, in return for compensation, which the Trust does not want, in an amount fixed now. If anything, they militate against Mr Crowe's application.
25. In these circumstances I think that something more than a mere balance of convenience is required before the Court exercises its power under the EBA to deprive the Church Trust of its land. The onus lies squarely on Mr Crowe to establish the existence of some good reason to exercise of the power in his favour.
26. On my findings, the Church Trust was not in any way responsible for Mr Crowe's decision to erect the Structures. It follows, I think, that, if the Court is to exercise the power at all, it should do so in a way which minimises the interference with the Church Trust's property rights. That has several consequences in the present case.
27. First, the relevant hardship to Mr Crowe, if any, lies in having to demolish the Structures, or pay for their demolition. I do not see Mr Crowe's inability to continue to use and enjoy the Church Trust's land, and the airspace above it, for recreational purposes as being hardship in any relevant sense, or at least as having any weight when compared with the Church Trust's proprietary rights.
28. It follows that no relief should be granted with respect to the slab. I have concluded that Mr Crowe has no obligation to remove it or to pay for its removal by the Church Trust. If the Church Trust itself chooses to remove the part of the slab on its property, I do not think that Mr Crowe has any basis for complaint.
29. It also follows that, if I considered that the circumstances were to justify relief with respect to the balcony or the roof overhang, I would not make an order for the compulsory transfer of the relevant part of the Church Trust's land. I would go no further than to order the grant of an easement in the CA standard form; that is, an easement lasting only as long as the relevant structure exists. That is all that is sought for the roof overhang anyway; and I would not extend the easement for the balcony to allow Mr Crowe to use it for recreational purposes (there may be some question about whether an "easement for recreation" is capable of being validly granted - see Petrie v Dickson [2024] NSWSC 972 at [125]-[264]- but it is unnecessary to go into that for present purposes).
30. The question thus comes down to whether Mr Crowe had demonstrated that, in the circumstances of the case, the hardship to him in having to demolish, or pay for the demolition of, the roof overhang or the balcony justifies the making of an order under EBA s 3(2).
31. In this regard, Shadbolt was a discretionary decision on its own facts. The decision was upheld on appeal on that basis, and does not establish any wider principle governing the exercise of power under the Act. In any event, I think the circumstances of the present case are different.
32. In Shadbolt, refusal of relief would have left the defendant free to remove the part of the swimming pool structure which had been built on his land, which would in effect have left the part of the structure remaining on the plaintiffs' land useless. In the present case the balcony could, on the face of it, be demolished without damaging the structural integrity of the house extensions on number 33. For the roof overhang, some remedial works on the roof of number 33 might be required. But again, the extensions would hardly become uninhabitable.
33. Nor am I satisfied that there was any tacit acceptance of the intrusion by the Church Trust. It is true that the work was done openly and was visible from the retirement village. But there is no evidence that anyone responsible for managing the Church's land holdings, and who knew where the boundary was, was aware of the intrusion. The only evidence before me shows that when officials of the Church Trust did become aware of work being carried out on land which the Trust owned, in 2019, they promptly took action to raise the matter with Mr Crowe.
34. As to the failure to obtain planning approval, I agree with counsel for Mr Crowe that it is a factor which must always be present in a case such as this. But that does not mean it is irrelevant. It does underline Mr Crowe's failure to seek formal consent from the Church Trust. And it was a studious failure: Mr Crowe was at the time in discussion with the Church Trust about the ownership of number 35, and said nothing at all about his plans to build on the Trust's land.
35. Failure to obtain planning approval arguably has a further significance. Mr Crowe remains at risk of being ordered to demolish the extensions, including the balcony and the roof overhang, in Land and Environment Court proceedings. If that happens, he will have to incur the cost of demolition anyway.
36. But to my mind the overriding consideration is that I am not satisfied that Mr Crowe believed that he had any right to build on number 35. In my finding, he was well aware that he did not own it and made a choice, for reasons he has not disclosed to the Court, to go ahead anyway. Any hardship he may now suffer from having to demolish the structures he erected is completely his own responsibility.
37. Slab: All of the same considerations apply to the slab.
38. Conclusion: For these reasons, I decline to make any order in favour of Mr Crowe under EBA s 3(2). It is unnecessary to go into the debate between the parties about the quantum of compensation which would have been awarded had I considered that an order for the grant of a compulsory easement should have been made.

Compulsory easement under CA s 88K

1. The easement sought by Mr Crowe under CA s 88K is defined in the proposed s 88B instrument as an "easement for stairs". To understand the application, it is easiest to refer to the accompanying survey plan which is reproduced below.
2. Under the proposed s 88B instrument the owners of number 33, and every person authorised by them, would have a right of way ("full and free right … to pass and re-pass") over the upper stair and also the area linking the external door to the landing at the top of the upper stair (both marked "D1" on the plan), so as to pass to and fro between the point where the lower stair reaches the edge of number 33 and the patio on the upper terrace above. The proposed s 88B instrument also contains express provision for the upper stair to remain on the property and for the owners of number 33 to be able to maintain, repair or replace it.
3. The proposed "easement for stairs" thus focuses on the preservation of the upper stair. It does not make any equivalent provision to protect the lower stair; indeed it seems that the lower stair is not completely encompassed by the right of way shown on the plan, which has a somewhat different shape.
4. The applicable law is not in dispute. The Court has power under s 88K(1) to grant a compulsory easement if that is "reasonably necessary for the effective use or development" of number 33. Various other conditions which must be satisfied are specified in s 88K(2), but it was not suggested that any of them created any additional hurdle in the current case. The Court has a discretion and an order may be refused even if the statutory conditions are satisfied: Khattar v Wiese [2005] NSWSC 1014 at [59]-[60].
5. As to what is "reasonably necessary for the effective use or development" of the proposed dominant tenement, the following statement by Hodgson J in 117 York Street Pty Ltd v Proprietors of Strata Plan No 16123 (1998) 43 NSWLR 504 at 508-509 has been approved by the Court of Appeal (Moorebank Recyclers Pty Ltd v Tanlane Pty Ltd [2012] NSWCA 445 at [154]): It is clear that 'reasonably necessary' in s 88K(1) does not mean 'absolutely necessary', and thus the requirement may possibly be satisfied even when the plaintiff's land could be effectively used or development without the easement. In my opinion: (1) the proposed easement must be reasonably necessary either for all reasonable uses or developments of the land, or else for some one or more proposed uses or developments which are (at least) reasonable as compared with the possible alternative uses and developments; and (2) in order that an easement be reasonably necessary for a use or development, that use or development with the easement must be (at least) substantially preferable to the use or development without the easement. … If there are some possible reasonable uses or developments of the land for which a proposed easement is not reasonably necessary, then it seems to me that the easement cannot be 'reasonably necessary for the effective use or development' of the land, at least unless there is some proposed use or development, for which the proposed easement is reasonably necessary, which is itself a reasonable use or development. It may be that the particular use or development would need also to be preferable to the alternatives; but whether or not that is so, it would in my opinion certainly need to be at least reasonable.
6. In this passage, Hodgson J refers to the grant of the easement as being "(at least) substantially preferable" course. But it is clear that this does not authorise the making of a compulsory easement order simply because the grant of the easement would be "convenient or nice to have": see ING Bank (Australia) Ltd v O'Shea [2010] NSWCA 71 at [50]-[53].
7. As Brereton J explained in Khattar, at [26]-[27]: … 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. 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 [citations omitted]. 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 [citations omitted].
8. Counsel for Mr Crowe submitted that reasonable necessity was established. He referred in particular to three aspects of the evidence.
9. First, counsel submitted that the upper stair (as well as the lower stair) was designed and built by Mr Lucas to fit in with the overall design of the house. The "original architectural vision", in counsel's phrase, had involved closing off the western side of the house and opening up the eastern side to the light. Counsel submitted that the relevant use and development of the house had been use and development as an "architect designed house", and the stairs were part of that.
10. Secondly, counsel submitted that unless the easement was granted, the steps at the foot of the "light well" would become useless. Counsel submitted that the whole point of the external door had been to provide access to the lower stair, and ultimately, via the side yard, to the top of the house. Unless an easement were granted, the door and the area outside it at the foot of the light well effectively sterilised.
11. Thirdly, counsel referred to the loss of amenity described in Mr Crowe's affidavit evidence (see [194] above). Counsel emphasised in particular the value of external stairs to provide separate outdoor access to bedrooms and the top terrace (in particular for transporting garbage and garden waste from the bins kept there down to the street).
12. In his submission, counsel for Mr Crowe relied in particular on the decision of the Court of Appeal in Arcidiacono v The Owners - Strata Plan No 17719; Arcidiacono v The Owners - Strata Plan No 61233 [2020] NSWCA 269, upholding a decision of Henry J at first instance (The Owners - Strata Plan No 61233 v Arcidiacono; The Owners - Strata Plan No 17719 v Arcidiacono [2019] NSWSC 1307). That case concerned the use of two small parcels of land in the Sydney CBD at the rear of properties facing York Street and Clarence Street. One of the issues was whether s 88K easements should be granted over the land in favour of the owners of adjoining buildings in York Street and Clarence Street.
13. One easement was sought for fire access in favour of the York Street property. It was contended that a compulsory easement was not necessary because a fire access way could be created through the York Street building itself. Henry J rejected this contention, concluding that while the construction of an access way on site might be possible, the delay in convenience in doing so was "not insignificant" due to the need to obtain council approval, and, in particular, to overcome heritage concerns (the building was heritage listed). Her Honour also referred to expert evidence from a fire safety expert as to the difficulties: at [174]-[180]. On appeal, her Honour's decision on the point was upheld: at [76].
14. Another application in the proceedings was for a compulsory easement to permit existing building structures such as "windowsill mouldings, parapet, corbel, conductor boxes/rainwater head, downpipes, electrical conduits, fire system pipes and sprinkler heads, and the vent pipe" to remain. Her Honour considered that reasonable necessity was made out, pointing out that some of the features in question had been in place since 1919 and retention of those features, or at least some of them, was necessary on heritage grounds: at [577]. Again, this conclusion was upheld by the Court of Appeal: at [76].
15. Counsel for Mr Crowe also called in aid the proposition stated in Butt's Land Law at [16.540] that "[p]ast use may help demonstrate reasonable necessity, if the claimed easement conforms with long-standing actual use of the servient land". Counsel pointed out that use of the upper and lower stairs by Mr Gyngell and his successors in title continued, unchallenged, for over 50 years before 2019. In counsel's submission, that was a further reason to conclude that "reasonable necessity" was established in the present case.
16. Counsel for the Church Trust submitted that the factors identified by counsel for Mr Crowe did not amount to more than convenience. Counsel emphasised that it was necessary for Mr Crowe to establish a value to number 33 as land, as distinct from improvements for amenity derived from the particular circumstances of the house's inhabitants.
17. Counsel also submitted that any need for outside access through number 35 arose from the renovations which Mr Crowe had himself carried out, filling in the corridor between the original eastern side of the house and the boundary. If those renovations had not been undertaken, then access could have been provided through that corridor. In counsel's submission, it was not open to an applicant under s 88K to obtain an easement based on a need created by the applicant's own actions.
18. In support of this submission, counsel for the Church Trust relied on the decision of Young J in Hanny v Lewis (1998) 9 BPR 16,205. In that case, the plaintiffs purchased a battleaxe block of land, the head of which lay down a steep slope, with a higher block between it and the street. Access to the battleaxe head was only available via easements for footway involving the use of steps or ladders. After purchasing the land, the plaintiffs built a substantial house on it. Then they made an application under s 88K for an easement over the land the subject of the right of footway to allow them to construct an inclinator. The reason given for an inclinator was that one of the plaintiffs was suffering from infirmities which made access by foot difficult if not impossible.
19. Young J refused the application, holding that reasonable necessity was not established. As his Honour pointed out, factors personal to the plaintiffs could not be used to establish "reasonable necessity" for the purposes of s 88K. His Honour commented, in addition: As a general approach to applications under this section the court must bear in mind that property rights are valuable rights and the court should not lightly interfere with the property rights of the defendants. It is in the public interest that landlocked land be utilised. However, the section does not exist for people to build right up to the boundary of their property or to build without adequate access and then expect others to make their land available for access. It is not unreasonable for a defendant to show that he or she has a legitimate economic advantage in the status quo, nor is it at all unreasonable for a defendant to say for privacy or other personal reasons that there would be such an interference with his or her property rights that no compensation in money could make up for it, and no order could be made: cf Re Parimax (SA) Pty Ltd (1954) 56 SR (NSW) 130 at 133; 72 WN (NSW) 386 at 388 per Myers J. His Honour repeated this comment in ING Bank (Australia) Ltd v O'Shea [2010] NSWCA 71 at [155]-[156].
20. In my view, the submission from counsel for Mr Crowe concerning the "vision" of the original architect, Mr Lucas, goes too far. True it is that Mr Lucas chose to open up the rear of the house to the east, and the lower terrace patio and balcony/pergola structure, as well as the glass sliding doors on the eastern walls of levels four and six, were part of that. But he was careful to ensure that the house, including the lower terrace patio and balcony/pergola, did not extend beyond the boundary of number 33. Presumably he would have recognised that Mr Gyngell, and future owners of number 33, could not have prevented the construction of a similar house on number 35, just as the prior construction of the house at number 31 had not prevented the construction of the house on number 33.
21. A similar comment can be made about the lower stair. The spiral staircase originally specified in the approved plans would have been contained entirely within the boundary of number 33. The construction of the stair in that form was not abandoned as a result of any relevant necessity. On the inference drawn by Mr Lonergan, which I have accepted, the change was only made so as to avoid the cost and inconvenience of removing, or cutting into, the existing sandstone rubble wall.
22. In my view, the "original architectural vision" should be understood by reference to the approved plans, and thus did not extend beyond the boundaries of number 33. It did not extend to the creation of the side yard, which depended upon arrangements made by Mr Gyngell with Miss Turkington after approval had been granted, and which allowed Mr Lucas and Mr Gyngell to supplement the "vision" by developing the side yard as they did. So understood, it is Mr Crowe himself, by his own actions and undertaking renovations, who has compromised the "original architectural vision".
23. It would also be incorrect, even if Mr Lucas' "vision" did extend to the side yard, to see the upper and lower stairs as stand-alone components of that "vision". The motive for establishing the side yard was to use it as a garden and children's play area. I have rejected Mr Crowe's claimed entitlement to occupy the yard. The easement now sought is simply a right of way through it. Once the potential for use of the yard for recreation disappears, it would be artificial to focus on some sort of architectural vision associated with the stairs alone. The stairs were clearly created to enhance the side yard as a garden, rather than the other way around.
24. I also think that counsel's submission about the "light well" area being sterilised goes too far. It is true that the steps leading up to the boundary would no longer be of any use. But that would not prevent the space being used at all. There seems no reason why it could not, for example, be modified so as to use it for storage, or for a small area of garden.
25. As to the amenity factors mentioned by Mr Crowe, his counsel accepted that s 88K is concerned with benefit to the proposed dominant tenement as land rather than transient benefits to individuals who happen to be living there at the time. But counsel contended that the factors identified by Mr Crowe were not purely personal, and would be beneficial to any residential owner.
26. This may be true to an extent. But what it tends to emphasise is that the benefits in question are in the nature of the things that are "nice to have" rather than necessities. There is an already internal access through the house. However convenient it would be for Mr Crowe to be able to have access because of his particular circumstances, it is difficult to say that an additional external mode of access is a necessity.
27. The statement by Young J in Hanny about self-inflicted "necessity" seems, with respect, intuitively correct. His Honour did not identify any textual basis for excluding self-inflicted "reasonable necessity" but on any view it would appear to be a matter which could be taken into account in the exercise of the residual discretion.
28. Furthermore, in the present case the works undertaken by Mr Crowe which prevent the eastern side of number 33 being used for external access between the bottom and the top of the house were not only undertaken by Mr Crowe himself, but were undertaken without council approval. As already noted, they remain vulnerable to an application for a demolition order on the part of the council or the Church Trust on that account. It seems to me that this is a further matter to be taken into account, if not in assessing "reasonable necessity", then in the exercise of the discretion. If the contest is between Mr Crowe demolishing illegal works on his own land so as to provide access or obtaining access by means of an easement on his neighbour's land, it seems to me that the balance falls in favour of maintaining the Church Trust's property rights to use its own land as it sees fit.
29. Even if I were satisfied that an external access way were "reasonably necessary", I would have to consider the intrusiveness of the easement sought. Because of the shape of the proposed right of way, it extends far more deeply into the Church Trust's land than it needs to. The total area within its perimeter is over 40m². The effect of granting the easement would be to sterilise, or at least severely impede the use of, the whole of that area.
30. It is well established that the effect on the servient tenement is a relevant factor in determining reasonable necessity, and not merely a matter to be taken into account by way of discretion: see Moorebank at [108]-[117]. To my mind, that means that in the usual case the court, if satisfied that an easement is reasonably necessary for a specified use or development of land, should frame it no more widely than is necessary to accommodate that use or development.
31. In the present case, any need for external access could be satisfied by the grant of a right of way over a narrow strip running along number 35's side of the boundary. That would not allow the use of the existing stairs, but it is up to the dominant owner to make a right of way trafficable, which would include, in the case of a right of way across a cliff face, the construction of steps or ladders: see Treweeke v 36 Wolseley Road Pty Ltd (1973) 128 CLR 274. For the purposes of s 88K, I do not see why Mr Crowe should be able to insist on an easement over a more extensive area merely to save himself that expense.
32. So far as Arcidiacono is concerned, it needs to be borne in mind that the Court of Appeal treated Henry J's decision as a quasi-discretionary one involving a contested evaluative judgment on which views might differ. In saying this, I am not necessarily saying that I disagree with her Honour's decision on the facts of the case. But they are remote from the present. It is one thing to say that where fire access is necessary, the Court may take account of the difficulties, and in particular the heritage constraints, on creating such access on the dominant tenement. It is another thing entirely to say that the case for granting an easement is enhanced by works that Mr Crowe undertook without approval and which have no heritage value.
33. Finally, the proposition from Butt's Land Law about the relevance of prior use of the proposed servient land for the purposes of the proposed easement is far from being decisive, or even weighty, in every case. This is made clear by the rest of the paragraph in which the proposition appears: Past use may help demonstrate reasonable necessity, if the claimed easement conforms with long-standing actual use of the servient land. For example, if a right of way is sought under s 88K over a path or lane that has in fact been used (but without legal right) for many years, that might indicate (but cannot be conclusive) that use of the right of way is reasonably necessary for use of the land. Similarly, long use of drainage pipes may help demonstrate their reasonable necessity for the purposes of an application under s 88K. But past use, of itself, is never sufficient; the question is always one of reasonable necessity on the facts of the case.
34. The proposition may be relevant to one or other of two aspects of the analysis. One aspect focuses on the land which is to benefit from the proposed easement: the fact that a right of way over adjoining land has in fact been used to gain access to the land in question may demonstrate the necessity for such access to be regularised. The other aspect focuses on the proposed servient tenement. The fact that access has previously taken place over part of that land may be relevant to the effect on it for the purposes of s 88K.
35. In the present case, it is the first aspect, namely benefit to number 33, which appears to be relevant. It may be accepted that the upper and lower stairs appear to have been in use continuously for decades, and that they provide a link between the top of the house, and the top terrace, and the external door on level two, which in turn leads down to the street. But I have already pointed out that the stairs were constructed as an enhancement to the use of the side yard as a garden and extension of the living area of level four of the house, and that use must now cease. No doubt this may have allowed for an alternative mode of access between level two and the top of the house but there was always internal access. Alternative external access may have been convenient and useful on occasion, but it was not necessary in the past and in my view does not satisfy the test of "reasonable necessity" now.
36. The same point may be put in a somewhat different way. Where s 88K speaks of a "use or development" of the subject land, it is apparently referring to some future use or development of the land. But there is no proposed future development of number 33. Nor is there is any proposed change of use. Number 33 ever since Mr Gyngell's day has been used for residential purposes and that use has not changed. A desire to improve the amenity of the house on number 33 by providing for alternative external access to the top of the house arguably is not substantial enough to amount to a change in the "use" of number 33 for the purposes of s 88K.
37. In my view the s 88K application fails at the first step. It is unnecessary to go into the parties' submissions about the quantum of compensation payable to the Church Trust if the easement were granted.

Conclusions and orders

1. I have concluded that: 1. Mr Crowe's claim to be entitled to occupy the side yard indefinitely into the future, by means of estoppel or implied agreement, fails; 2. so too do Mr Crowe's application for a transfer of parts of the side yard and its airspace, or a compulsory easement, under EBA s 3, and his application for a compulsory easement under CA s 88K; 3. the Church Trust's claim in trespass succeeds with respect to the roof overhang, the balcony and the deck in the side yard (as reconstructed in 2019), and the Trust is entitled to a mandatory injunction requiring the removal of those structures (or, in the case of the deck, to damages representing the cost of removal).
2. The result is that Mr Crowe's cross-claim fails and should be dismissed. The Church Trust's claim succeeds to the extent indicated, but it will be necessary to formulate the mandatory injunction to which the Trust is entitled in precise terms (and deal with the assessment of damages for the cost of removal of the deck, if the parties cannot agree on a regime for its removal).
3. In these circumstances I will defer making final orders in the proceedings to allow the parties an opportunity to negotiate and agree on the form of the final orders, and, if possible, costs. If agreement cannot be reached, I will hear further argument.
4. The orders of the Court are: 1. Order the proceedings be adjourned to 9:30am on 8 November 2024 or such other occasion as may be agreed by the parties and notified to my Associate, for the making of final orders and costs orders, or directions for any further hearing on either of those questions.

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