Court of Appeal overrules Council's objection to driveway over park

Our Bartier Perry Bulletin of August 2012 dealt with the decision in Saad v City of Canterbury [2012] NSWSC 389, where the Supreme Court made an order pursuant to s. 88K of the Conveyancing Act 1919 imposing a right of way over a park for the benefit of an adjoining parcel of land owned by Mr Saad.  The decision was within existing principles, but the Council nevertheless appealed.

You may remember that Mr Saad’s property was landlocked, and he needed an easement across the adjoining park for access.  The City of Canterbury had refused his request, but he was successful in the Supreme Court.  We can now report that the Council failed in its appeal to the Court of Appeal, on all grounds, and the Council is now to pay Mr Saad’s costs.

The decision is an authoritative restatement of the principles in granting easements under s. 88K, and is also instructive in dealing with “public interest” issues.

There are some technicalities in the decision, but the message is that easements will be granted in order to facilitate the permitted use of property.

The dispute

The park, Heynes Reserve, is owned by Canterbury Council and is classified both as a “park” and “community land” under the Local Government Act 1993.

In 2006, the Council zoned the land now owned by Mr Saad as residential 2(a) pursuant to the Canterbury Planning Scheme Ordinance knowing that the land was landlocked by neighbouring privately owned land and by Heynes Reserve.  The Council also amended the Ordinance to require adequate vehicular access to be provided as part of any residential development of the land.  In 2007, Mr Saad bought the land from the then RTA following a publicly listed tender.

When his request for an access easement was refused, Mr Saad appealed, successfully, and then the Council appealed.

The appeal

The Council did not question the power of the Supreme Court to impose easements over community land, the precedent for which was established by Marshall v The Council of the City of Wollongong [2000] NSWSC 137 and Etwell v Newcastle City Council [2006] NSWSC 1165. 

However, the Council contended that:

• the easement was not reasonably necessary for the effective use or development of Mr Saad’s land;

• the use of Mr Saad’s land, with the benefit of the easement, would be inconsistent with the public interest; and

• the Court should not exercise its discretion to impose the easement.

On 6 August 2013, the Court of Appeal, led by Beazley P (with Meagher and Leeming JJA agreeing), dismissed the Council’s appeal with costs.

Although the decision of the Court does not change the law regarding the imposition of easements over community land, it is instructive on the matters which the Court will take into consideration in determining the three grounds of the Council’s appeal.  There is value in reviewing the Court of Appeal’s rejection of the Council’s three arguments.

1. Was the easement reasonably necessary for the effective use or development of Mr Saad’s land?

The Court cannot impose an easement over land unless it is “reasonably necessary for the effective use or development of” the land that will have the benefit of the easement:  s. 88K(1).

Beazley P held that the qualification for the necessity to be reasonable permits the Court to have regard to matters beyond the relatively absolute necessity for the effective use or development of the land to be benefited by the easement.  The qualification calls for an assessment of that necessity having regard to all relevant matters, according to the criterion of reasonableness.  This includes assessing the impact of the easement on the land to be burdened by the easement and the fact that ordering an easement detracts from the property rights of the owner of the land to be burdened by the easement.

Turning to the facts of this case, the easement burdened part of two lots which together comprised Heynes Reserve.  The site of the easement covered an area of about 90 m² out of the much larger park.  The Council submitted that the grant of the easement would cause the effective loss of the whole of the smaller of the two lots.  Beazley P rejected this submission because the Council accepted that if a driveway were built over the smaller lot, members of the public could still use that lot in the same way and for the same purposes as it is currently used.  The only impediment would be the need for members of the public to move when vehicles were driven along the driveway.  This was consistent with the nature of an easement which involves a shared use and occasional inconvenience to the owner of the burdened land and those entitled to use it.

Assessing the facts of the case to determine whether the easement satisfied the “reasonably necessary” test, Beazley P held that the conclusion of the Supreme Court “that the grant of the easement was reasonably necessary was not only open on the evidence, it was the only conclusion available on the evidence”:  at [44].

2. Would the use of Mr Saad’s land, with the benefit of the easement, be inconsistent with the public interest?

The Court must be satisfied that the use of the land with the benefit of the easement will not be inconsistent with the public interest:  s. 88K(2)(a).

As Beazley P noted, the clear words of s. 88K(2)(a) state and the authorities establish that the public interest requirement is focussed on the land with the benefit of the easement, not the land with the burden of the easement.  Beazley P found that Mr Saad’s land is zoned residential and that an owner of residential land is entitled to use that land in accordance with its zoning provided that development consent is obtained.  Further, the Ordinance required adequate vehicular access to be provided as part of any residential development of the land.

Applying the principles in Rainbowforce Pty Ltd v Skyton Holdings Pty Ltd [2010] NSWLEC 2 to s. 88K(2)(a), Beazley P held that the fact that an applicant for an easement may still have to fulfil other requirements before the land can be used in accordance with the zoning, such as obtaining development consent for the construction of a driveway, is not a bar to the grant of the easement.

For these reasons, Beazley P held that the provision of an easement permitting vehicular access to a residence on Mr Saad’s land was entirely consistent with the public interest in the use or development of that land for its designated purpose.

3. Should the Court refrain from exercising its discretion to impose the easement?

The Council contended that the Supreme Court should not have exercised its discretion to order the easement because Mr Saad purchased the land knowing that it was landlocked and paid a discounted price for the land when compared to the value of surrounding land.

Beazley P rejected the Council’s argument noting that there was no evidence that Mr Saad purchased the land at a discounted price in circumstances where the purchase occurred by way of public tender.  His Honour noted that, for the purposes of s. 88K(1), the Court is not concerned with whether an applicant for an easement took a gamble in acquiring the land.  His Honour further considered that it is irrelevant whether Mr Saad acquired the land at an advantageous price, knowing that the land could only be usefully developed if an easement were granted.

As to the relevance of Mr Saad purchasing the land knowing that it was landlocked, Beazley P held that it was not a factor which should prevent the Court from exercising its discretion to grant the easement.

His Honour stated that the exercise of judicial discretion requires the Court to “have regard to all relevant circumstances” at [72].  In this case, Mr Saad had attempted to find alternative means of access.  The Council had zoned Mr Saad’s land residential knowing that it was landlocked.  The Ordinance required access to be provided as part of any residential development and the easement over Heynes Reserve was the only feasible way to gain access.  The impact of the easement on Heynes Reserve was minimal and did not amount to being a “forced appropriation” of community parkland as maintained by the Council.

The relevant circumstances of this case were held to support the exercise of the Court’s discretion to grant the easement.

Implications of the Case

The Court of Appeal’s decision is instructive generally on various factors which must be satisfied for the imposition of an easement under s. 88K.  In particular, this decision provides useful guidance to landowners when examining the facts of their particular cases in considering whether to apply to the Supreme Court for the imposition of an easement.  The Court’s decision will also assist Councils in framing a response to any court proceedings for an easement and in not taking a position which may result in an adverse award of costs.

Authors: Peter Barakate and Dennis Loether