Posted on September 4, 2013 by

The Land Locked Lot and the Park: Court imposed easements

The Court of Appeal has confirmed a Supreme Court decision which saw a land-locked lot at Earlwood granted an easement over the Council’s community land used for (access to) a park.

The fact that the purchaser of the land knew that it was land-locked when purchasing the lot and that the purchase price may have been discounted as a result, failed to dissuade the Court from granting the easement. Those factors were held to be either irrelevant or not adverse to the application made under s88K of the Conveyancing Act 1919.

Background

23A Gornall Avenue (Property) was owned by the RTA in 1998 when it was earmarked for a road reservation.  When the road reservation was abandoned, the RTA sought a rezoning.

The Property is bounded by two residential lots to its south, and is otherwise surrounded by Heynes Reserve, two lots of land zoned Open Space and classified under the Local Government Act 1993 as ‘community land’.  It is (or more correctly, ‘was’) land-locked.

Canterbury Council concluded that the land was best zoned residential 2(a) under the Canterbury Planning Scheme Ordinance, subject to the qualification that ‘any development should be subject to satisfactory access arrangements given the landlocked nature of this allotment.’ An amendment to this effect was incorporated into the Ordinance when the rezoning was approved on 18 August 2006.

The RTA sought an easement from the Council after the rezoning, and also offered to sell the land to the Council at market rate for its residential value.  The Council declined both requests, stating, in relation to the offer to sell the land, that the Council would only use the land to extend Heynes Park, and that the area was already ‘well serviced with open space’.

The RTA then sold the Property landlocked to Mr. Saad for $140,000.00 on 28 January 2008.

Mr. Saad approached his neighbour at 21 Gornall Avenue seeking access without success. (Access through the other potentially relevant privately owned property at 19 Gornall Avenue seems not to have been feasible as the house covers the whole frontage).

Mr Saad then renewed his efforts with his new neighbours when 21 Gornall Avenue changed hands.  It does not emerge from the judgement, but the owners of 21 lodged a DA with Council, allowing them to build almost to the boundary, and preventing any possibility of an easement through that Property.

Mr. Saad then approached the Council in June 2010 seeking an easement through Heynes Reserve to the public street.  Council declined, indicating not only that the Council lacked power to grant an easement over community land, but also that the Council would oppose any section 88K application by Mr. Saad for a Court imposed easement.

Application under section 88K Conveyancing Act 1919

Section 88K of the Conveyancing Act gives the Court the ability to impose an easement if the easement is reasonably necessary for the effective use or development of other land that will have the benefit of the easement.

Such an order can only be made subject to three pre conditions under section 88K(2):

• the use of the land having the benefit of the easement will not be inconsistent with the public interest;
• adequate compensation must be available to the owner of the land over which the easement is granted;
• all reasonable attempts to secure an easement by negotiation must have been exhausted.

Reasonably necessary?

Nicholas J, at first instance, reviewed the authorities and found that the easement was reasonably necessary.  When the matter went to the Court of Appeal, Beazley P went even further: In my opinion His Honour’s conclusion 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 paragraph 44).

The land had been zoned residential 2(a).  Further, the rezoning was predicated on the need for access before the grant of any consent to development.  On this basis, the easement was not merely reasonably necessary: without it no development whatever could take place in accordance with the zoning.

Public interest

Here the Council concentrated on the community land over which the easement would travel.  Council argued it would not be in the public interest for the status quo to be disturbed for the sake of private interest (at paragraph 52 in the Court of Appeal).

Not so concluded Beazley P.  The area of the easement was small, at least in comparison to the whole of the Council parkland.  The easement was 2.83 meters wide, running for 32 meters, an area of about 90 square metres.

Beazley P pointed to the Council’s mistake in concentrating on the public interest relating to the Council land in circumstances where s88K(2)(a) looks towards whether the use of the land benefiting from the easement will be in the public interest, rather than the burdened land.

The Court nevertheless noted that it was relevant to consider the degree of burden over the community land.  There is an obligation to weigh the benefit to one party and the burden to the other.  Yet here this was no great exercise, either before the judge at first instance, nor in the Court of Appeal.  While the Council land was used for recreation, the proposed burdened land was already used for the most part as access to the greater parkland and this would not be significantly interfered with.  There was little burden in the circumstances.

Compensation

The Court at first instance had assessed compensation on the basis of valuation data for the residential properties in the vicinity which established a value per square metre. Based on the  size of the easement, the value was halved.  An easement is not the same as  the land itself, hence the halving of the value.  Compensation of $54,000 was therefore ordered.   This question was not the subject of any appeal to the Court of Appeal.

All attempts to negotiate had been exhausted

The Court of Appeal did not overturn the judge at first instance’s finding that Mr. Saad had done all he could to seek an easement from the private adjacent owners.

Discretion

Even though all the factors in section 88K had been made out, the Council still had one argument: discretion.  Section 88K is a discretionary remedy.  The Court still has the power, notwithstanding the statutory formula being satisfied, to refuse the grant and easement in the circumstances of the case.

The Council argued that Mr. Saad had purchased the land knowing it to be landlocked.  Why should the Court now assist him by compromising public land?

The Court turned this argument on its head.  Mr. Saad could not have made the application before he bought the land.  The Court would consider the circumstances at the time the application was brought, not at the time of the sale.

The Council argued Mr. Saad purchased the land at a knock down figure.  Again, why should he have a windfall profit at the public’s expense?  The Court said there was no comparable data to say that he had purchased it at a remarkably cheap price. However, he had also incurred costs of the s88K application, including those of the Council and consultant advice.

The Council had also caused the zoning of the land for residential purposes, knowing that it was landlocked. The LEP amendment that the Council sought for the rezoning recognised that appropriate access had to be granted.  Beazley P concluded (at paragraph 72): ‘..the Council must have foreseen the possibility of an application as made by the respondent.’

Finally, the Council argued that the public should not be deprived of its parkland, and that this factor should be considered in the discretionary factors, not just in relation to the question of the public interest.  Here, the Council’s own assessment report came back to haunt it.  Council, when offered the land by the RTA had concluded that the area was already ‘well serviced with open space’.  If that was the case, the Court concluded, the public would not be unduly disadvantage by the granting of the easement.

Conclusion and lessons

Ultimately it was left for Mr. Saad and the Council to consider a DA for the dwelling on the property before the final form of the easement was settled.

The case should not be seen as a carte blanche warrant for section 88K easements over community land.  Both at first instance and in the Court of Appeal the Court was at pains to stress that an application for use of community land for private purposes was to be ‘jealously scrutinised’ (at paragraph 50 in the Court of Appeal).  In this particular case the private landowner had a stronger case than the Council.  Future applications will not be able to rely on a proper reading of this case as authority to allow easements over community or public land merely because it helps a developer or private owner.

It was common ground in the matter that the Council could not of its own volition agree to the easement.  Even if a Council agreed that the easement should be granted, section 45 of the Local Government Act 1993 does not give the Council the power. Rather, an application needs to be made to the court in each case.