New South Wales Supreme Court CITATION : Sydney Legacy Appeals Fund v Legal Chambers Pty Limited [1999] NSWSC 344 CURRENT JURISDICTION : Equity Division FILE NUMBER(S) : 2963/95 HEARING DATE(S) : 15 April 1999 JUDGMENT DATE : 15 April 1999 Sydney Legacy Appeals Fund (P) PARTIES : Legal Chambers Pty Limited (D1) Registrar-General (D2) JUDGMENT OF : Master McLaughlin COUNSEL : Ms. S. Dowling (P) Mr. I. M. Khan (D) SOLICITORS : C P White & Hetherington (P) Champion & Partners (D) CATCHWORDS : ACTS CITED : Real Property Act 1900 CASES CITED : General Steel Industries v Commissioner for Railways (NSW) (1964) 112 CLR 125 Dobbie v Davidson (1991) 23 NSWLR 625 DECISION : SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION MASTER McLAUGHLIN Thursday, 15 April 1999 2963/95 SYDNEY LEGACY APPEALS FUND -v- LEGAL CHAMBERS PTY LIMITED & ANOR JUDGMENT 1 MASTER: By notice of motion filed on 9 March 1999 the first defendant, Legal Chambers Pty Limited, seeks an order that the summons of the plaintiff, Sydney Legacy Appeals Fund, be struck out pursuant to the provisions of Part 13 rule 5 or, in the alternative, pursuant to the provisions of Part 15 rule 26(1) of the Supreme Court Rules, upon the basis that the proceedings do not disclose a reasonable cause of action and are frivolous, vexatious and an abuse of process. 2 The substantive proceeding were commenced by summons filed by the plaintiff on 2 July 1995. That summons names two defendants, being Legal Chambers Pty Limited as first defendant and the Registrar-General as second defendant. The Registrar-General has not taken any active part in the proceedings and has not been represented at the hearing of today's application. 3 The substantive relief sought in the summons is a declaration that the plaintiff, as registered proprietor of the land described in Schedule 1 to the summons, is entitled to the benefit of a right of way along and inside the western boundary of the land described in Schedule 2 to the summons, of which the first defendant is the registered proprietor. The summons also seeks as consequential relief an order for the production to the Registrar-General of the duplicate certificate of title and an order that the Registrar-General rectify the register. 4 The present dispute relates to a laneway which is part of the land known as 9 George Street, Parramatta. That land now comprises the entirety of the land contained in Certificate of Title Folio Identifier 41833824. Part of that land consists of a laneway about 12 feet wide along the western boundary of that land. 5 The plaintiff is the registered proprietor of land known as 150 Marsden Street, Parramatta, which land is in part contiguous to the land of the defendant. 6 The plaintiff, which is a body corporate, claims through various of its members that it has in fact been using the laneway, the subject of the present dispute, since at least 1956 and probably since the time when it acquired the land at 150 Marsden Street two or three yearly earlier. The laneway was not originally part of the land which was owned by the defendant, known as 9 George Street. 7 The substantial part of the land at 9 George Street was held under Old System title when acquired originally by the defendant. Subsequently the major part of that land, but not including the laneway, was brought under the Real Property Act. 8 The defendant acquired the laneway by way of prescriptive title. On 10 September 1993 the defendant lodged a primary application to bring that laneway under the provisions of the Real Property Act and for consolidation of the laneway with the balance of the land at 9 George Street, which was already under the Real Property Act and already owned by the defendant and of which the defendant was the registered proprietor. 9 On 20 July 1994 the plaintiff lodged a caveat pursuant to section 74B of the Real Property Act 1900 against the defendant's primary application. 10 In August 1994 the defendant received a letter dated 3 August 1994 from the Director of the Land Titles Office, advising of the lodgment of the caveat and stating the caveat would remain on the title for three months, after which period the caveat would lapse. The caveat itself in the schedule thereto set forth the nature of the estate or interest being asserted by the caveator as being "right of way pertinent to land owned by the caveator or contained in certificate of title 6936 folio 76". The following facts were then stated: The caveator has used the right of way for more than 20 years. 11 Subsequently the caveat lapsed, and on 12 December 1994 the primary application of the defendant was approved and a fresh certificate of tile issued to the defendant. That certificate of title consolidated the title to the subject laneway with the title to the land of which the defendant was already the registered proprietor. That title was, however, subject to an easement, described thereon as follows: Right of way affecting the part shown as per contained in the title diagram. 12 The right of way referred to in that certificate of title as a right of way over the area of the laneway is the subject of the present proceedings. However, the benefit of the right of way disclosed in the certificate of title was benefit not for the registered proprietor of the land of the plaintiff but a benefit for the Commonwealth of Australia in its capacity as the registered proprietor of certain other land which was contiguous to the land of the defendant. 13 In due course, the Commonwealth, as the registered proprietor of the dominant tenement, on 10 December 1997 executed in favour of the defendant, the registered proprietor of the servient tenement, a transfer releasing the right of the way in favour of the Commonwealth. 14 Thus it will be appreciated that since the date of that release the defendant is the registered proprietor of the land known as 9 George Street and there is no right of way or other easement operating on the title to that land. 15 The plaintiff in the substantive proceedings, however, asserts that it has acquired a prescriptive easement over the laneway. In support of that assertion the plaintiff has filed a number of affidavits from various persons who, according to their affidavits, have since as early as 1956 used the laneway in order to gain access to the rear part of the property of the plaintiff and have parked various motor vehicles on the property of the plaintiff using the laneway for the purpose of ingress to and egress from that area of the plaintiff's land upon which the vehicles have been parked. None of those persons have been cross-examined upon their evidence. Indeed, it would be quite inappropriate in an application for summary dismissal of the plaintiff's claim, as is the present application, for disputed questions of fact to be attempted to be resolved. 16 The defendant is content in the present application to accept the evidence asserted by the plaintiff, in the various affidavits. 17 The defendant does not deny that the laneway has been used on behalf of the plaintiff for many years. Indeed, the defendant asserts that that use has been as a consequence of permission or consent given by the defendant to the plaintiff. The defendant does, however, deny that the plaintiff, through its various members and advisers, has any right to use the laneway. The defendant, through its Counsel, has informed the Court that it will continue to abide by the statement of intention appearing in correspondence which passed between the parties in October of 1994 (being annexures K and L to the affidavit of Maxwell Crothers Clark sworn 12 March 1999), and confirms that it will permit continued vehicular access to the parking area at the rear of the plaintiff's property along the laneway which is the subject of the present proceedings. 18 The plaintiff, however, is not content that it should have some, what might be described as, personal consent or permission from the defendant to use the laneway for access. The plaintiff is desirous of establishing a legal right to use it, such that that right will continue irrespective of whether the defendant is the registered proprietor of the land at 9 George Street or whether some other entity becomes the owner of that land. 19 The defendant brings the present application pursuant to the provisions of each of Part 13 rule 5 and Part 15 rule 26, essentially upon the basis that no reasonable cause of action is disclosed in the plaintiff's claim. The principles in relation to such an application are well-known. It is only necessary for me to refer to the decision of the High Court of Australia in General Steel Industries Incorporated v Commissioner for Railways (NSW) (1964) 112 CLR 125, especially the judgment of Barwick CJ. 20 It was submitted on behalf of the defendant that the plaintiff's claim is doomed to failure and that it cannot succeed. The defendant based its submissions on two grounds. The first ground is that which emerges from indefeasibility of title contained in a number of provisions of the Real Property Act 1900. The defendant submitted that Division 2 of Part 6 of the Act creates a regime concerning the lodging of caveats against primary applications and the consequences of such lodgement. 21 It was submitted on behalf of the defendant that the plaintiff, having lodged the caveat but not having complied with the machinery and procedures contemplated by such provisions of that Division as section 74C(1), has totally lost any right which it might otherwise have to substantiate the existence of the alleged right of way, including any right which it might have to a prescriptive easement over that laneway. In this regard the defendant relied upon the passage in Peter Butt, Land Law, 3 ed. (1996), in which the learned author, at paragraph 20103 on page 770, refers to the importance of resorting to the provisions of the Act relating to the lodgment of a caveat against a primary application. In that paragraph the learned author states: Resort to the caveat provisions may be imperative for a person claiming an interest in the land the subject of a primary application. If the primary application is granted and a folio of the Register is created for the land, interests not carried forward into the folio will be extinguished (see Assets Co Ltd v Mere Roihi [1905] AC 176 at 212). 22 The defendant also points to the fact the plaintiff has not seen fit to make any claim against the Registrar-General in consequence of the primary application having been granted and the certificate of title in respect of the laneway issuing without any reference to a right of way in favour of the land of the plaintiff. 23 The plaintiff, however, submitted that there is no provision in the Real Property Act which has the effect asserted by the defendant, in that no provision of the Act says that failure to follow the procedures set forth in Division 2 of Part 7A will result in the caveator being deprived of an opportunity of asserting the existence of a prescriptive easement. The plaintiff submitted that any rights which it might have in respect to the existence of a prescriptive easement in its favour cannot be lost merely as a result of the plaintiff having lodged a caveat against the primary application and that caveat having in due course lapsed and the plaintiff not having chosen then to follow the procedures contemplated by section 74C(1), in particular paragraph (a) of that subsection. 24 The defendant also submitted that, in any event, even if the plaintiff was not precluded by the provisions of the Real Property Act and the failure of the plaintiff to avail itself of the machinery contained in Division 2 of Part 7A, the plaintiff, nevertheless, has not established that a prescriptive right to an easement over the laneway has come into existence. For such a prescriptive easement to exist the plaintiff must establish a user for at least 20 years and that user must have been as a result not of a permission or consent of the owner or registered proprietor of the land but as a result of a right asserted openly, not by force, and not by permission. 25 I have been taken to the decision of the Court of Appeal of New South Wales in Dobbie v Davidson (1991) 23 NSWLR 625, in particular to the judgment of Kirby P (as he then was) commencing at 627. His Honour there considered the nature of such a prescriptive easement which could then fall within the exception to the principle of indefeasibility provided in section 42(1)(b) of the Real Property Act. That section provides that the registered proprietor shall hold the estate or interest in the land: "... subject to such other estates and interests and such entries, if any, as are recorded in that folio, but absolutely free from all other estates and interests that are not so records except: ... (b) in the case of the omission or misdescription of any profit à prendre created in or existing upon any land. 26 It was submitted on behalf of the defendant that, even if the plaintiff could establish that, in an open fashion, as of right, it has for at least 20 years exercised a user over the laneway, and although from the mid 1950s that right was exercised, nevertheless, according to the defendant, in 1972 at the request of the plaintiff the defendant consented to the plaintiff using the laneway. Thus the period of 20 years by right was interrupted, and so, it was submitted by the defendant, since 1972 the user of that laneway by the plaintiff has been as a consequence of the consent given by the defendant. It was submitted, therefore, that no prescriptive easement has come into existence and that no prescriptive easement can come into existence because of that consent given in 1972. 27 It is, as I have already recorded, not contested that the plaintiff has been using the laneway for more than 20 years. But a very important question is whether it has been using it in consequence of an asserted right or in consequence of a grant of permission. 28 The alleged grant of permission, however, appears from the minutes of various meetings of the board of directors of the defendant which are annexed to the affidavit of Maxwell Crothers Clark sworn 7 April 1999. Those minutes relate to the permission being given by the defendant to the plaintiff to the parking of motor vehicles. They do not expressly refer to the use of the laneway. 29 It may very well be that, upon a final hearing of these proceedings, when contested questions of fact are to be evaluated by the Court and findings concerning those contested questions of fact are to be made, the plaintiff will be found not to have been able to substantiate the asserted right which it claims to have exercised over the laneway. 30 However, it seems to me that in the present application it would be quite inappropriate for me to conclude that use of the laneway since 1972 has been consequent upon that permission granted by the defendant. 31 Also, despite the submissions made on behalf of the defendant, I am not persuaded that the only construction which can be given to the provisions of Division 2 of Part 7A of the Act is to extinguish for all purposes any right asserted by a caveator where the caveat against the primary application lapses and that caveator does not choose to follow the statutory procedures and machinery then made available by that Division. 32 It may well be that at a final hearing the defendant would succeed in such a construction of the statute, but it is by no means certain. It is certainly arguable that the statute does not have that construction. 33 It is not appropriate, therefore, that in an application for summary dismissal of the plaintiff's claim I should deprive the plaintiff of an opportunity of arguing at a final hearing, firstly concerning the statutory consequence of the lapsing of the plaintiff's caveat and the failure of the plaintiff thereafter to take the steps contemplated in that regard by the provisions of Division 2 of Part 7A of the Act, or to deprive the plaintiff of an opportunity of establishing by evidence in appropriate form that it has acquired a prescriptive right to the use of the laneway. 34 By the same token, of course, the defendant will have an opportunity at a final hearing of contesting the evidentiary matters asserted in the various affidavits of people who have said they have used the laneway on behalf of the plaintiff since the mid 1950s and the defendant will also have an opportunity to place before the Court in admissible form evidence which in today's application was, upon the objection of the plaintiff, rejected. That evidence included evidence relating to the control and dominion said to be exercised by the defendant over the laneway and also concerning the assertion of the defendant, which is disputed by the plaintiff, that the defendant was responsible for the construction of a gate at the entry to the laneway and the circumstances in which that gate was used by persons entering the laneway and travelling to the rear of the plaintiff's premises. 35 In all the circumstances, therefore, I am not satisfied that the defendant has established an entitlement to the summary relief which it presently claims. I propose, therefore, to dismiss the notice of motion. 36 (Ms Dowling sought costs for the preparation of the motion. Mr Khan opposed the costs order sought and submitted that costs should be costs in the cause.) 37 I make the following orders: 1. I order that the notice of motion filed by the defendant on 9 March 1999 be dismissed. 2. I order that the defendant pay the costs of the plaintiff for the aforesaid notice of motion. 3. I grant leave to the plaintiff to proceed forthwith to assessment of the forgoing costs. 4. I order that the plaintiff serve any further affidavits upon which it may wish to rely on or before 27 May 1999 and that the defendant serve any further affidavits within 28 days thereafter. 5. I stand the matter over to 5 July 1999 before the Registrar. ********** Last Modified: 09/07/1999 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.