Posted on June 9, 2016 by Megan Hawley
Effect of Subdivision and Amalgamation on Interests in Land
It is not uncommon for disputes to arise regarding the effect of a subdivision or amalgamation of land, on interests in the land or easements affecting the land.
In Moreton Bay Regional Council v Mekpine Pty Ltd  HCA 7, the High Court found that a registered lease over land (Lot 6) did not extend to a new parcel of land which resulted from an amalgamation of Lot 6 with other land to create a new, larger Lot 1. The plan of subdivision which effected the amalgamation noted that the amalgamation was subject to ‘existing lease allocations’ , so there was no doubt that the lease over Lot 6 would survive the amalgamation.
However the High Court rejected the lessee’s argument that the lease would extend over the whole of the new lot.
In doing so the Court found that there was nothing in the lease which would explicitly or implicitly have the effect of expanding the lease area in the event of an amalgamation. Therefore, as the lease was in respect of land defined as Lot 6, the land defined in the lease after the amalgamation was only that part of the new Lot 1 which was formerly Lot 6.
By analogy if an easement had only benefitted Lot 6, the easement would not then, after amalgamation to create Lot 1, benefit the whole of Lot 1. This is important for Council officers and developers to be aware of, particularly when considering access issues in connection with a development application.
If an easement is relied on for access, and that easement only benefits part of a development site (such as one lot), the access may not be able to be lawfully relied on for the purposes of the development.
This is particularly so given that many easements when properly construed, may grant access to and from the benefitted lot, but might not permit access across the benefitted lot to other land and parts of the development on that other land (see Westfield Management Ltd v Perpetual Trustee Co Ltd  HCA 45).
Amalgamating the lots will not overcome this issue. The easement would need to be extended to benefit the whole development site.
In the case of subdivisions of land, an interest for the benefit of land will generally subsist for all lots created by the subdivision of that land, unless there is something in the terms of the original grant to suggest otherwise ( see Gallagher v Rainbow & Ors (1994) 121 ALR 129).
Therefore, if a lot has the benefit of an easement for access, and the benefitted lot is subdivided for residential development, then there is a presumption that all of the newly created lots will have the benefit of the easement for access, provided the terms of the easement are not otherwise restricted.
There are of course, additional considerations if the use of the easement or interest is to be changed or intensified in a manner not envisaged by the original grant. These issues may arise in property law (that is, whether the terms of the grant of the easement permit the intensification) and in planning law (the use of the easement for the purposes of the development may itself require development consent).
There are risks for both developers and consent authorities if careful consideration is not given at an early stage to the true effect of interests benefitting and affecting land to be developed.