Posted on May 30, 2012 by Stuart Simington

Conditions requiring restrictions on title: to be or not to be?

Two recent cases provide examples of when the Land and Environment Court think it is  (and is not) appropriate to impose or maintain conditions requiring the registration on title of public positive covenants or restrictions as to user.

In McMahon v Wagga Wagga City Council, the Council sought the imposition of a restriction on user preventing the occupation of a proposed dwelling ancillary to deer farming on a sub-sized rural allotment. The proposed condition was to be in relevantly the same terms as a corresponding condition of the consent.

Commissioner Pearson agreed that the restriction on user on title was appropriate to ensure that notice was given to potential purchasers of an important restriction. The restriction was not one, in the view of the Court, that should be left to the diligence of a conveyancer to locate in a consent on the Council’s files. In that regard, the Court relied on the principle in Fortunate Investments Pty Ltd v North Sydney Council (2001) 114 LGERA 1 that a requirement for registration of restrictions on title is permissible in such circumstances. The Court considered that the condition:

• did not attempt to limit the ability to obtain a further development consent in the future;
• did not duplicate the law providing for the enforcement of conditions of consent in the Environmental Planning and Assessment Act 1979;
• would relate to matters referred to in s79C(1)(b) of the Act and could therefore be imposed under s80A(1)(a).

There was a different outcome in Fitzpatrick Investments Pty Ltd v Blacktown City Council [2012] NSWLEC 1133. In that case, the developer sought to delete a condition relating to the preservation of trees in the context of a consent for residential subdivision. The  condition to be deleted was as follows:

Post construction of the subdivision the trees, identified in Condition 75 (a) [sic] above and as finally preserved on site shall be the subject of a s 88B (Restriction as to user) instrument under the Conveyancing Act 1919 identifying the trees that must be retained on each of the individual allotments that are created.

The developer argued that the condition was unnecessary and inappropriate by placing a burden on the developer and future purchasers but serving no planning purpose.

The Council argued that the condition ensured the protection and maintenance of identified trees and  was necessary to ensure that potential purchasers were notified of the preservation requirement.

Commissioner Dixon held that the condition did no more than provide an  extra layer upon the consent being an ‘extra’ reminder that an owner would need to obtain permission to remove trees identified in the instrument under the Council’s TPO.

The condition was considered to be an ‘extra’ reminder because the TPO would apply to protect the trees and it was the Council’s policy to list the TPO and development controls on the s 149(2) certificate for the land. As a copy of the s149 certificate would need to be included in any contract for the sale of land,  the Court concluded that a purchaser would be put on notice of the need for consent to remove a tree on the land.

Conclusions

There is clearly a continuing reluctance of the Court to impose restrictions on title. The court will not do so unless there is a good reason distinct from a motivation to provide an additional means for enforcement of the restriction.

As evidenced by the decision in McMahon, however, there will still be cases where it is appropriate.

The distinguishing factors which justify the different outcomes in the two subject cases appear to be as follows.

• In Fitzpatrick, consent was required under the TPO before the trees could be removed and the TPO restriction would be identified by the s149 certificate.
• In McMahon there was no evidence on whether the restriction would be noted on the s149 certificate. If there had been such evidence, it is quite possible that the decision would have been different.