Armflock Pty Ltd v Thimios & Ors [1998] QSC 304

o o o C) State 351'31 Reporting Bureau Sc 98 / 3oif TRANSCRIPT OF PROCEEDINGS Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Director, State Reporting Bureau. SUPREME COURT OF QUEENSLAND CHAMBERS JONES J Writ No 193 of 1998 ARMFLOCK PTY LTD and GEORGE THIMIOS and RENE THIMIOS and THE REGISTRAR OF TITLES CAIRNS .. DATE 16/12/98 JUDGMENT 1 REVISED COPIES ISSUED State Reporli:-:g Bureau :Oate II/ 1::J.../98---I Plaintiff First Defendants Second Defendant -- 1 of 10 -- 161298 D.1 T6/LVT M/T CNS912/98 {Jones J) HIS HONOUR: In this matter the plaintiff seeks, by way of notice of motion, the rectification of records in the office . 'of the Department of Natural Resources and for an inj unction to restrain the defendants from obstructing or impeding his access to his residential property which is situated at Leoni Close and described as Lot 5 on Registered Plan 886980 County of Nares, Parish of Cairns. The injunction will not be necessary if the rectification relief is granted. The plaintiff, as owner of the property, had the benefit of registered Easement N in Lot 4 on Registered Plan 886980 for the purpose of access to its property. The terms of the grant of easement also included that the plaintiff should have "full and free right and liberty to construct and maintain within the easement area an access driveway, drainage, and conduits for transmission of electricity, telephone, water supply, gas, telecommunications and other services to the dominant tenement" . 1 .. 10 20 o o 30 oThe easement was created when the land was first subdivided. 40 ,The registration of the easement appears to have been a condition for the approval by the Cairns City Council for the subdivision. The easement agreement also provided by clause 3 as follows: "This easement shal1 be deemed to be obsolete and the Grantee shall without compensation surrender the same if at any future time a public road is dedicated and constructed so as to allow practical vehicular and pedestrian access to and from the Dominant Tenement for all purposes connected with the use and enjoyment of the Dominant Tenement. If a public road allowing for practical pedestrian and vehicular access is dedicated and constructed over part of the easement area, the easement shall be deemed to be obsolete in respect of that part on which such road is 2 JUDGMENT o 50 60 -- 2 of 10 -- 161298 D.1 T6/LVT M/T CNS912/98 (Jones J) constructed, and the Grantee shall without compensation execute a partial surrender of the easement insofar as it relates to that part. If a public road is dedicated and constructed so that practical pedestrian and vehicular access is allowed to and from the Dominant Tenement partly by way of such road and partly by this easement, then that part of the easement which is no longer required to permit such pedestrian and vehicular access shall be surrendered by 10 o o o the Grantee without compensation. II It seems clear enough that the purpose of the inclusion of this clause was for the benefit of the Cairns City Councilor other construction authority, by removing the liability to pay compensation should the access have to be surrendered or partially surrendered for the purpose of providing public roads or other public purposes. The other provision in the easement agreement was clause 4 which was effectively an attornment clause empowering the grantor of the easement, the defendants, the act in the stead of the plaintiff to execute a surrender or partial surrender where the grantee, by terms of the easement or by law, was required to do so. The defendants in this instance appear to have formed a view (~ that because of the existence of a public road, Konowna Close which the plaintiff's land abuts, was now in existence and because in their opinion practical access was achievable (though with great diff~culty and expense) the easement was obsolete. The defendants then set about effecting a surrender of the easement and in that pursuit purported to act as attorney for the plaintiff. In endeavouring to effect a surrender of the easement, they would have had no doubt that such an event would occasion considerable hardship to the plaintiff. 3 JUDGMENT 20 30 40 50 60 -- 3 of 10 -- , 161298 D.1 T6/LVT M/T CNS912/98 (Jones J) The terms of ~lause 4 of the easement agreement are as follows:- "The Grantee hereby irrevocably appoints the Grantor and it successors in title to the servient tenement to be the true and lawful attorney of the Grantee to execute on its behalf and in the name of and as the act and deed of the Grantee a surrender or, as the' circumstances require, a partial surrender of this easement in any case where the Grantee is by the terms hereof or by law required to do so, and to do all such things and to sign all such documents as are necessary to obtain registration thereof, BUT such power shall not be exercised unless and until the Grantor has submitted to the Grantee for execution by it a draft surrender or, as the circumstances require, a partial surrender of the easement in registrable form, together with a written notice calling on the Grantee to execute and deliver the same, and the Grantor has failed to execute and deliver the same within one month after the notice has been given, proof whereof to the Registrar of Titles shall be the declaration of the attorney exercising the Power." 10 20 o In accordance with that provision, the defendants gave notice c=) to the plaintiff of their intention to seek the surrender. 30 Such notice of that intention was given on or about 7 August 1998 by its solicitors and included a draft surrender of easement and a notice requiring the plaintiff to execute the surrender. A further letter was sent on 30 July 1998 by the defendants' solicitors ~hich enclosed the various documents c=) 40 which were required to be executed by them, the failure to do which would constitute grounds for the defendants acting under c=) the attornment clause. On 27 August 1998 the solicitors for the plaintiff wrote to i 50 the defendants' solicitors objecting to the course upon which they had embarked. That letter referred to clause 3 of the easement agreement and made the point that it did not apply to the situation that attained, in effect, that it applied only to the dedication of a future road. That letter included the following paragraphs - 4 JUDGMENT 60 -- 4 of 10 -- 161298 D.l T6/LVT M/T CNS912/98 (Jones J) "If your client has some problems in relation to this I'd be quite happy to discuss the matter with you further. But under the circumstances it is my client's opinion that there is no entitlement to your client to have existing Easement N surrendered. Lot 5 always had the legal liability to have access to Konowna Close and it had this legal right immediately upon the registration of the Survey Plan and the issue of 10 the titles. That registration of the plan brought Konowna Close into legal effect as a "dedicated road"." That objection taken by the plaintiff appears simply to have been ignored by the defendants. c=) The next step taken by the defendants was to lodge with the Surrender of Easement document now signed by the defendants as c=) c=) c=) the duly constituted attorney for the plaintiff, a declaration which was intended to satisfy the Registrar of Titles that all steps had been properly taken to bring about the surrender. In that declaration the defendants declared that a course of correspondence had been followed between them and the plaintiff. For some reason which has not been satisfactorily explained, the letter written by the plaintiff's solicitors objecting to that course· was not included in that bundle of documents. Whether the reason for its omission was to mislead the Registrar of Titles or whether it is explained by simply saying the solicitors for the defendants took a contrary view and felt it was unnecessary for the letter to be sent to the Registrar of Titles, it is a matter which, in the end result, I do not have to decide. But I should record that it would give me grave concern, as it would indeed to any public official, that a letter of such material importance to the task being undertaken was omitted. 5 JUDGMENT 20 30 40 50 60 -- 5 of 10 -- 161298 D.1 T6/LVT M/T CNS912/98 (Jones J) In the upshot, receiving the declaration without that letter and the Surrender of Easement document executed by the defendants in their purported role as attorneys, it is clear that the Registrar of Titles has been misled. For this reason the surrender of the easement which followed that conduct must be reversed. 6 JUDGMENT 10 20 o o 30 o40 o 50 60 -- 6 of 10 -- o o o 161298 D.l T7/CH M/T CNS912/98 (Jones J) Section 185 of the Land Title Act 1994 ("the Act") provides as follows, "(1) A registered proprietor of a lot does not obtain the benefit of section 184 (quality of registered interest) for the following interests in relation to the lot - (c) The interest of a person entitled to the benefit of an easement if its particulars have been omitted from, or misdescribed in, the freehold land register". 3. For the purpose of subsection l(c), an easement is taken to have been omitted if - (a) The easement was in existence when the lot burdened by it was first registered but . particulars are no longer recorded in the freehold land register against the lot burdened; or (b) ~he easement was registered but later omitted by an error of the Registrar". It seems to me that subsection 3 applies in the circumstances of this case. On the material it is clear that the easement was in existence when the lot was first registered and it is clear from the searches which are annexed to the material that it is no longer recorded in the freehold register. o That then invites the consideration by this Court of section 187 of the Act. It is in the following terms: "(1) If there has been fraud by the r~gisteredproprietor or section 185(1) (c) to (g) (Exceptions to s 184) applies, the Supreme Court may make the order it considers just. (2) Without limiting subsection (1), the Supreme Court may, by order, direct the registrar - (a) to cancel or correct the indefeasible title or other particulars in the freehold land register; or (b) to cancel, correct, execute or register an instrument; or 7 JUDGMENT 10 20 30 40 50 60 -- 7 of 10 -- 161298 D.1 T7/CH M/T CNS912/98 (Jones J) (c) to create a new indefeasible title; or (d) to issue a new instrument; or (e) to do anything else". It is immaterial in the circumstances therefore to determine 10 whether the surrender has been effected by fraud or whether one can simply proceed by treating the events as giving rise to an omission for the purpose of section 185 of the Act. In either event, the outcome will be the same. 20 For the reasons that I have mentioned above, I will treat the o circumstances which give rise to the need for these proceedings as an om~ssion and, consistent with the powers outlined in section 187 of the Act, the most convenient course o is to direct th~ Registrar to cancel the instrument of 30 surrender of easement, which I expect would then allow the reinstatement of the easement and its registration on the instrument of title. r / C oIf I am wrong about the effect of this order, I will give 40 leave to all parties to apply for its amendment. o Pursuant to section 187 of the Act, I direct the Registrar to 50 cancel the instrument of Surrender of Easement dated 14 September 1998 bearing dealing number 702897976 and to reinstate Easement N dealing number 700555162 over Lot 4 on Registered Plan 886980 County of Nares, Parish of Cairns. 60 8 JUDGMENT -- 8 of 10 -- 161298 D.1 T7/CH M/T CNS912/98 (Jones J) J HIS HONOUR: Question of costs? o o MR MORZONE: I'd urge upon Your Honour for the costs orders in paragraphs 3, 4 and 5 of the draft, in so far as they affect the plaintiff in particular, ~y submission in respect of costs in paragraph 3, I've placed in the outline of submissions in paragraph 5. Really pointing to the conduct, this would be completely unnecessary had sensible approaches been made and the Attorney 10 exercised that power properly. In other words, we seek indemnity costs on that basis. HIS HONOUR: Mr Philp? MR PHILP: Yes, Your Honour. The Registrar's position is that it would seek its costs. I note Mr Morzone's saying they're costs from the second defendant - from the first defendant. Your Honour the Registrar's position would probably best be expressed that ·either party or both parties should be . responsible for his costs and if Your Honour wants to make an order indemnifying the plaintiff against the Registrar's costs or order them direct them against the second defendant----- HIS HONOUR: Yes .. MR PHILP: -----the first defendant but Your Honour, I'm not sure of the position of each of any of the parties in a financial sense so the Registrar has been brought into this. Your Honour has found that the Registrar has been misled. Perhaps there should be a costs order against both other parties with suitable indemnities from the first defendant to the plaintiff? HIS HONOUR: Yes, you could make a Bullock order but I doubt that it's necessary in this case. 20 30 o MR PHILP: It may not be, Your Honour. o HIS HONOUR: Yes, all right. Mr Lanza? MR LANZA: Yes, Your Honour, well obviously costs follow the event. I would object to the solicitor and client basis of course. Again Your Honour did not have to make a finding on the issue of fraud or otherwise and I would urge Your Honour . to take that into consideration. HIS HONOUR: Yes. MR LANZA: I tend to agree with my learned friend, Mr Philp, in so far as a Bullock order for the costs. Obviously we would have to pay the cost of the reinstatement. HIS HONOUR: Yes. All right, yes thank you for that. MR LANZA: That is my submission. HIS HONOUR: My view of this is that when people act pursuant 40 50 to a power of attorney they have a high duty and in this case ~ that duty was not complied with. 9 JUDGMENT -- 9 of 10 -- 161298 D.1 T7/CH M/T CNS912/98 (Jones J) MR LANZA: Indeed, Your Honour. HIS HONOUR: Yes, I will make, the following orders for costs: That the first defendant pay the plaintiff's costs of and incidental to this action to be taxed on the basis of solicitor and client. I further order that the first defendants pay any costs associated with the rectification of the records of the Registrar of Titles. I further order that the first defendants pay the second defendant's costs of.and incidental to the applicatlon to be taxed on the basis of party and party. 10 JUDGMENT 1 v , , 10 20 o o 30 o 40 o 50 60 -- 10 of 10 --