The plaintiff is the owner of a rural property near Crookwell. The land is within the boundaries of the defendant Council. The plaintiff obtains access to its property via a public road that is vested in the Council. That public road runs off Roslyn Road in a northerly direction towards the plaintiff's property.
The plaintiff and the Council entered into a Deed on 11 December 2018. That Deed is the central subject of these proceedings. By its Statement of Claim filed on 4 May 2021, the plaintiff seeks orders in the nature of a specific performance to compel the Council to perform its obligations under the Deed. The Council, by its Defence filed on 15 June 2021, disputes the plaintiff's claim.
By a Notice of Motion filed on 1 July 2021, Cameron Willis and Tania Willis seek orders for their joinder to the proceedings as the second and third defendants respectively. They claim to be necessary parties to the proceedings on the basis that the relief sought by the plaintiff would, if granted, directly affect their rights in relation to the public road.
The applicants are the owners of lots 2 and 4 in Deposited Plan 536001. The lots adjoin the eastern boundary of the public road. In support of the motion, the applicants relied upon the affidavit of Cameron Willis of 29 June 2021 and the exhibit to that affidavit.
The proposed joinder is resisted by the plaintiff, which submits that joinder is not appropriate in circumstances where the plaintiff seeks specific performance of a deed to which the applicants are not parties, seeks no relief against the applicants, and the interests of the applicants would not be directly affected by the orders sought. The proposed joinder is not opposed by the Council, which took a neutral position.
There was no dispute as to the principle that a person who is directly affected by orders sought in a proceeding is a necessary party, and that the obligation to join that person rests with the plaintiff who is applying for the orders (see Ross v Lane Cove Council (2014) 86 NSWLR 34; [2014] NSWCA 50 at [51]-[61] per Leeming JA). The High Court decision in John Alexander's Clubs Pty Ltd v White City Tennis Club Ltd (2010) 241 CLR 1; [2010] HCA 19 is a well-known example of the operation of that principle. In order to determine whether the orders sought by the plaintiff directly affect the applicants it is necessary to consider the Deed that is sought to be enforced in the proceedings by the plaintiff and the form of relief claimed by the plaintiff.
It appears that at the time the Deed was entered into on 11 December 2018, the public road was in the ownership of the Crown.
Clause 3 of the Deed is important. It provides that the Council and the plaintiff acknowledged and agreed on various things, including:
1. that upon the Department of Industry - Lands and Water transferring the road to the Council the plaintiff would submit certain road construction plans and specifications to the Council, which will include 'accesses to property boundaries at current access points for each of the other Current Road Users';
I note in passing that the definition of "Current Road Users" includes the owners of lots 2 and 4 in Deposited Plan 536001;
1. that upon completion of the roadworks the road would be used by the plaintiff as its primary access and the Current Road Users will have access 'as the road is a public road';
2. that on the closure of the road by the Council, Council will provide rights of carriageway access over the closed road reserve for the benefit of the Current Road Users; and
3. that on the closure of the road by the Council, Council will execute a transfer of the land that was formerly comprised in the road.
Reference should also be made to clause 5 of the Deed which sets out the Council's responsibilities. These include:
1. commencing the process for the closure of the council road; and
2. assessing and processing the closure of the road pursuant to Division 4 of Part 3 of the Roads Act 1993 [ss 38A-38F] as expeditiously as possible.
The evidence before the Court discloses that the road has been transferred to the Council and that the Council has passed a resolution to close the road. However, there is no evidence that the Council has proceeded so far to publish a notice that it is proposing to close the road pursuant to section 38B of the Roads Act 1993 (NSW).
Section 38C of the Roads Act provides that after the publication of such a notice, a period of time is given for submissions to be made to the Council and for formal objections to be made by "notifiable authorities". If a formal objection is made, the road may not be closed unless the objection is withdrawn or is set aside by the Land and Environment Court on an appeal brought by the Council (see section 38D(2)(b)). In the absence of a formal objection, the Council may, after considering any submissions that have been made, close the road by notice published in the Gazette (see section 38D(1)). On publication of such a notice, the road ceases to be a public road and the rights of passage and access that previously existed in relation to the road are extinguished (see section 38E(1)). However, the land comprising the former road remains vested in the council (see section 38E(2)(a)). Section 38F of the Act provides for rights of appeal to the Land and Environment Court in respect of a closure of a public road.
Specific reference should be made to clause 5(e) of the Deed which provides that the Council will facilitate the process for transferring the ownership of the land in the road to the plaintiff, including by the registration of a plan that includes the land in a separate lot; and specific reference should also be made to clause 5(f) which requires the Council to sign all documents necessary to effect the transfer and ownership of the land to the plaintiff.
Clause 5(e) of the Deed is at the heart of the present dispute between the plaintiff and the Council. The plaintiff contends that it has prepared a draft deposited plan in accordance with the Deed and that the Council is wrongfully refusing to sign the plan to enable its registration. The council contends that it is not obliged to sign the plan because it fails to provide access for the other Current Road Users, as required by clause 3 of the Deed. Questions of construction of the Deed thus arise in the proceedings. I should add that there is evidence that the Council envisages that there will be no closure of the road until after the required Deposited Plan has been registered.
The relief sought by the plaintiff is in the nature of specific performance of the Deed (see Prayer 1). Prayer 2 seeks an order that the Council do all such things as are necessary to approve the draft Deposited Plan to enable its registration. Prayer 3 seeks an order that, upon registration of such plan, the Council do all things and execute all documents necessary to transfer the title of the land in lot 1 of the plan to the plaintiff; that is, the land that presently comprises the public road.
The question is whether the applicants are persons who are directly affected by the orders sought by the plaintiffs. I think that is a finely balanced question. However, in circumstances where a transfer of the land would only be able to occur once the road has been closed, an order in the form of Prayer 3 would entail requiring the Council to proceed, no doubt in accordance with the law, to close the road. As a closure of the road would extinguish the rights of the applicants to use the land as a road, I think that it can be said that the applicants are persons who would be directly affected by the making of the orders sought by the plaintiff.
It was submitted that it would not be the orders of the Court that would directly affect the interests of the applicant, but rather the act of publishing the notice in the Gazette that closes the road. It was submitted that the Council has resolved to do such a thing, and it is merely the fulfilment of that intended process that would have the relevant effect upon the applicants' rights. I do not think that is correct. Whilst the Council has resolved to close the road, that resolution is not irrevocable. It cannot be said that the Council is committed, in a legal sense, to the process, and I do not think it can be said that the closure of the road would occur in any event quite apart from the obligations upon the Council pursuant to the Deed. It seems to me that the resolution itself is likely to reflect the existence of such obligations.
In coming to the conclusion that I have, I have borne in mind the observations of Ward CJ in Eq in Xinfeng Australia International Investment Pty Ltd v GR Capital Group Pty Ltd [2019] NSWSC 1547 at [67] where her Honour noted that the direct effect test involves matters of degree, and ultimately judgment, having regard to the practical realities of the case.
I think that the position in this case differs, including in a practical sense, from that which arose in Lithgow State Mine Railway Limited v City of Greater Lithgow Mining Museum Inc [2019] NSWSC 1131. In that case, the existence of a caveat maintained by the party seeking to be joined meant that, at most, the orders made by the Court in the nature of the specific performance would require one of the contracting parties to seek the removal of the caveat. The carrying out of the orders could not themselves affect the caveator's rights. The orders would only have an indirect effect upon those rights. Here, it seems to me that the carrying out of the orders is capable of directly affecting the applicants' rights, because the carrying out of those orders may entail a closure of the public road; that is so even if the applicants may have rights of appeal under section 38F of the Roads Act in respect of any such closure. I therefore think that the applicants fall within Uniform Civil Procedure Rules 2005 ("UCPR") r 6.24(1) as persons whose joinder is necessary.
I have not overlooked the so-called rule in Tasker v Small (1837) 3 My & Cr 63, that the only proper parties to a suit for specific performance of a contract are the parties to the contract. The merits and the continued relevance of the rule is a matter of debate. I do not propose to enter into that debate here. It seems to me that the rule is to be regarded as a general rule, and one that is no doubt appropriately applied in almost all cases. I described the rule as a general rule in Lithgow State Mine Railway Limited v City of Greater Lithgow Mining Museum Inc (supra). In the rather unusual circumstances of the present case, I consider that if it were necessary to do so, a departure from the general rule would be warranted. In this context I note the applicants' submission that the case here goes beyond a suit for specific performance insofar as it entails questions of construction of the Deed. In any event, I consider that the real question is whether the applicants' interests are directly affected by the orders sought in the proceedings by the plaintiff. Having come to the conclusion that they are, the Court will make an order pursuant to UCPR r 6.24(1) that the applicants be joined to the proceedings as the second defendant and the third defendant respectively. The Court will also order that the plaintiff pay the applicants' costs of the Notice of Motion filed on 1 July 2021.
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Decision last updated: 27 September 2021