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Benmar Properties Pty Ltd v Makucha; Makucha v. Benmar Properties Pty Ltd & Anor [1993] QSC 269

Case law · Queensland · 1993
0 0 0 IN THE SUPREME COURT OF QUEENSLAND No. 557 of 1992 BETWEEN: AND: BENMAR PROPERTIES PTY LTD (ACN 010 729 496) PAUL MAKUCHA Plaintiff Defendant by Original Action AND BETWEEN: PAUL MAKUCHA Plaintiff AND: BENMAR PROPERTIES PTY LTD First DefendantAND: . REGISTRAR OF TITLES Second Defendant by Counterclaim REASONSFORJUDGMENT-THO~J. Delivered the lOth day of September, 1993 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 A more detailed statement of the facts • • . • . . . . . • • . . . . . . . . . 5 Validity of the leases . . . • . • . . . • • . . . • . . • . . . . . • • . . . . . . . 15 Termination- of the leases • . . • • . . . • • . . • . • . . . . • . . . . . • • . 35 Relief against forfeiture • . . . • • . • . • . • • . • . • . • • • • . . . • . • • 38 Other matters . ~ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 -- 1 of 40 -- 2 The plaintiff (Benmar) is in the business of outdoor advertising, and makes arrangements which permit interested companies (including brewery and cigarette companies) to display signs near highways. The two signs that are in issue in this case are displayed on either side of the Pacific Highway near Beenleigh. The one on the western side of the highway (on land described as lot 2) is a double sided "trivision" sign, and that on the other side of the highway (situated on property described at lot 5) is a double sided illuminated static sign known as "Big Bertha". ,( The income generated from these signs is, at least to my mind, surprisingly Q high, being of the order of about $250,000 per annum, whilst the outlays are quite low. The plaintiff, it would seem, succeeded in establishing two tempting profitable Q assets. The. means by which the plaintiff is in the position to control the signs and make contracts with those interested in advertising their products, depends upon two registered leases which were granted by the owner of the relevant lots in December 1988. The leases were lodged in the office of the Registrar of Titles on 29th June, Q 1989 and were registered on 20th December, 1989. They grant to the plaintiff for a period of 99 years commencing 1st February, 1989 the right to install and maintain Q an advertising device on a designated part of each lot, as delineated in a surveyor's plan which forms part of the lease. The rental reserved under each lease was $1 per year. At material times the plaintiff has held licences from the Albert Shire Council for the display of its signs, pursuant to the licensing by-law of that Council which is called by-law no. 8. From time to time variations to the signs have been made with the permission of the Council. Fairly substantial licence fees are involved, and the evidence shows that the fee for "Big Bertha" rose to $2,811 in -- 2 of 40 -- 3 1991. It is admitted on the pleadings that the Council licensed the plaintiff to operate the signs, and it is quite plain that the plaintiff has done what the Council has required of it from time to time and that the Council has no quarrel with the plaintiff in relation to its continued operation of the signs. The first appearance upon the scene of the defendant (Mr Makucha) was on 28th November, 1990. On that date he signed a contract to purchase the freehold from the mortgagee (Partnership Pacific) of the registered proprietor (Firewater Pty 0 Ltd). He knew of the registered leases and was aware of their contents. He did not complete the purchase until almost a year later (15th November, 1991). However in 0 early December, 1990 very soon after signing the contract with Partnership Pacific, he made the plaintiff aware of his desire to take over the signs. There followed a low offer which was refused. Since then the defendant has alleged that the lease is invalid, threatened expensive legal proceedings, alleged zoning defects and consequential breach of each lease, given notice of termination Q of the leases, and brought multiple court actions including (so far) two appeals to th~ Court of Appeal. This has been based on investigation, presumably initially of local 0 authority files, with the object of uncovering some irregularity or invalidity that~~, might found an allegation of breach or weaken the plaintiff's position. The laws governing the activity of local authorities, particularly town planning law, have become so complex that any such search may be thought to have reasonable prospects of uncovering some practices that fail to meet the requirements of at least some part of the Local Government Act or by-laws, and this case tends to confirm that notion. The defendant chose to share his concerns of illegality with the Council and with the plaintiff's customers. The plaintiff's perception that the defendant was "coming at us from all sides" is by no 1Ileans an overstatement. It -- 3 of 40 -- 4 must be recognised that the defendant has the right to endeavour to destroy the leases by any legal means. At the same time, I do not think it unfair to identify his conduct since the end of 1990 as a sustained commercial raid with a number of oppressive features. At the end of the day the questions are whether it is soundly based in law. Despite the prolixity of pleadings and material, counsel agree that there are 0 three basic issues. These may be briefly stated as follows: 1. Is the lease void? (This depends mainly upon the contention that it amounts to a subdivision and 0 that s. 34(8) of the Local Government Act was not complied with). 2. Were the termination notices of 20th March, 1992 effective to determine the lease? (This involves the validity of the s. 124 notices dated 9th December, 1991 0 alleged breach of cl. 3.12 of the lease, and required the breach to be remedied by procuring the land to be included in an appropriate zone. The defendant 0 nominated three months as a reasonable period to remedy the breach. The main questions are whether there was a breach and whether the plaintiff has remedied it within a reasonable time.) 3. Should the plaintiff be relieved against forfeiture? (This question only arises if question 1 is answered "no", and if the defendant is found to have validly terminated the lease. As the great bulk of the evidence in the case was admitted on this issue only, it will be desirable that I address this question in any event.) -- 4 of 40 -- 5 A more detailed statement of the facts In about 1986 a company named Aosco purchased a number of allotments including lots 2 and 5 upon which the relevant signs now stand. It was run by the same interests as those in control of the plaintiff, and for practical purposes may be regarded as the plaintiff's predecessor in the relevant outdoor advertising business. Applications were made to the Albert Shire Council for permission to erect and display advertising signs, and licences were issued. On lot 2 a trivision sign was built Q by Aosco in 1987 at a cost of about $80,000. It was installed in replacement of an earlier static sign. Registration of the new sign was obtained in December, 1987 and Q the licence (apparently number 0364) has been maintained thereafter. In the case of lot 5, a sign was erected at a cost of between $1.50,000 and $160,000 in April, 1989. Again the licence (number 0998) has been maintained. On the advice of accountants, Benmar became the vehicle by which the advertising business was conducted and Benmar became the lessee upon whose tenure Q the right to continue to display the signs depends. Initially it was intended that Aosco should grant a lease over the relevant parts of lots 2 and 5 to Benmar (whose U name was then Ventel), and leases in a form. very similar to those in issue in the present action were executed and lodged in the Titles Office. These however were withdrawn to enable a sale of the freehold from Aosco to a third party to proceed. In the event, Aosco sold the land to Consulting and Design for about $450,000, on 30th November, 1988. That company quickly on-sold it to Firewater for $1M on 6th December, 1988. There was an understanding or arrangement between the relevant parties that a lease would be granted by the purchaser to Ventel on the same terms as the lease formerly granted by Aosco to Ventel which had been withdrawn from registration to enable the sale to proceed. That arrangement was honoured, and on -- 5 of 40 -- 6 12th December, 1988 the relevant leases were executed by Firewater and Ventel. These were eventually registered 'in the Titles Office on 28th December, 1989. The practice of local authorities, of the practising profession and of the Registrar of Titles in relation to leases of more than five years where only part of the land is leased and when the parties are desirous of registering the lease has been described in evidence. Under that practice which has been followed for many years, less onerous requirements are insisted upon in relation to the preparation of surveyors' plans and in relation to local authority certification thereof in the case of Q subdivisions by lease than in the c~se of subdivisions as they are more generally understood in which separate titles are created out of an existing title. The usual Q practices in relation to these matters were followed, both in relation to the initial leases from Aosco to Ventel and the· ultimate leases from Firewater to Ventel. This involved the preparation of survey plans delineating· the area the subject of each lease. Applications were made to the local authority for subdivision and for sealing of the survey plan. In the case of lot 2, the original application was made on 23rd Q April, 1987, but the area for the lease seems to have been regarded by the Council as too large, and on 2nd June, 1987 a plan of a smaller area (800m2 as per drawing 0 9467) was substituted. This was approved by the Planning and Development Committee on 15th June, 1987 and by full Council on 25th June, 1987. With respect to lot 5, the application for subdivision was made on 2nd November, 1988 (with respect to an area of 1000m2). The map on the Council file which shows the relevant delineation is a copy of the drawing which is identified by Mr Lawson as that on 'his map 9944. The Planning ·and Development Committee approved the proposed subdivision by lease on 14th November, 1988 and this recommendation was adopted by the Council on 24th November, 1988. -- 6 of 40 -- 7 The respective leases, containing the prospective survey plans, were then signed and sealed by the Council in the usual way, that is to say by authorised use of the seal with the signatures of the Shire Clerk and Chairman upon a page forming part of the lease. The consent is endorsed on form 35 prescribed under the Real Property Regulations of 1986. It is called a general consent, and identifies the lease and title reference. It states "the Council of the Shire of Albert being the relevant local authority hereby consent to the registration of the instrument specified in item Q 1 above". This is taken by the Registrar of Titles as a sufficient indication of the fact that the local authority has consented to the subdivision effected by the lease, Q and in the ordinary course such a lease will be registered. It should be noted that. both this form and the relevant survey plan are bound into the lease, but that the local authority's consent is not endorsed upon the survey plan as such, as is :the case. with subdivisions which lead to the creation of additional allotments and title deeds. As indicated above the original intention that Ventel obtain its. leases from Q Aosco was altered, and in its place Ventel was granted similar leases by the ultimate purchaser, namely Firewater. The only differences in the two sets of documents '0 are- (a) dates of execution (1st November, 1988 and 12th December, 1988 respectively); (b) commencing dates (1st November, 1988 and 1st February, 1989 respectively); (c) an immaterial alteration to cl. 6~01 (mentioned at p. 136 of ex. 19); (d) an immaterial correction to the description on plan 9467. The subdivided areas and the plans were identical with tho~e approved by the council. The position was explained to the Shire Clerk by a letter from the plaintiff's solicitors (Messrs Porter Clayt~n and Co) on 30th May, 1989. The existing -- 7 of 40 -- •' 8 consents were referred to, and the change of parties was noted. The new leases were enclosed. The letter stated that they had been prepared in terms identical to those previously executed by the parties, and although this is not strictly accurate, it was ·not in my view a material mis-statement. The differences could not possibly have led the Council to a different conclusion in relation to these notional subdivisions. In my view the Council had already approved the subdivisions that were involved in these replacement leases. The fresh leases were enclosed with a request for execution· of the appropriate forms of consent. These were duly signed and Q sealed by the Town Clerk and Shire Chairman on 6th June, 1989. On 20th June,. 1989, a meeting of the Council "endorsed" the actions of the Shire Chairman and Q Shire Clerk in executing these documents and their use of the common seal. Mr Porter then lodged them for registration. In one instance there was a Titles Office requisition brought about by the circumstance that the copy of the survey plan in the lease had been reduced from B4 paper. Mr Porter retrieved the documents from the Titles Office,· and arranged for the replacement of the Q unacceptable document with another copy of the relevant survey plan. I do not regard any material alteration as having occurred, and consider that the plans Q approved by the Council, attached to the respective leases to which the Council's · officers applied the Council's seal on the two separate occasions, and the plans in the leases which are now registered iri the Titles Office are in all material respects identical. I do not understand Mr Douglas Q.C. (for the defendant), in the end, to have submitted otherwise. He maintained the submission however that the leases had not been lodged- for registration within six months of the notation of approval of the local authority. As to that I hold that the relevant notations of approval were -- 8 of 40 -- '• 9 made on 6th June, 1989, and the leases were lodged for registration on 29th June, 1989. The leases were finally registered on 20th December, 1989. Benmar continued its business, obtained- clients for the signs, and dealt with the Council pursuant to the Council's licensing requirements under by-law 8. The defendant first came upon the scene late in 1990, on 28th November, when he signed a contract for the purchase of six lots including the two lots in Q question in these proceedings, from Partnership Pacific Limited as mortgagee exercising power of sale, for a total price of $550,000. It was not completed until Q 15th November, 1991, but the defendant immediately showed his interest in obtaining control of the signs in question. In about November, 1990 the defendant telephoned Mr Smith (a director of Benmar) and offered to buy the signs. In a second conversation with Mr Smith soon after, he threatened legal action unless the signs were sold to him, threatening that Q the plaintiff would be "hauled into court" and that it would end up losing the signs. Mr Smith (whose evidence I accept) described the conversation as threatening and as Q couched in offensive language. The defendant Mr Makucha did .not enter the witness box. On 27th December, 1990 his solicitors wrote to Benmar asserting that the signs could not be lawfully used because of inappropriate zoning and stating that he would upon completion of his purchase (then said to be 13th March, 1991) require strict compliance with the terms of the lease. Mr Irvine (the principal director of this part of Benmar's business) contacted the Council but was informed that there was no need for any rezoning, as the current licences were all that was required. -- 9 of 40 -- 10 In early 1991 the defendant had further telephone calls with Mr Irvine alleging that he had the opinions of two Sydney silks to the effect that the leases were invalid. He said that the structures were worth no more than $200,000 and that Benrhar shou~d have that sort of rrioney set aside for a court action. The plaintiff then obtained its own legal advice on 14th May, 1991 and instructed Roy Somerville Surveys Pty Ltd to act on its behalf.. This resulted in application to the Council on 4th June, 1991 seeking the rezoning of lots 2 and 5 to .• "special facilities (signage and siteline)". After some initial delay on the part of the Q Council, the stirveyors drew up rezoning applications on 6th September, 1991. The applications were then duly advertised by the Council. The defendant Q lodged objections to the applications on 15th October, 1991. There were two other objectors. The defendant's grounds of objection included that it was wrong to effect "a spot zoning of one small leasehold area" and that the application was inconsistent with the development and use of the overall parcel. The defendant emphasised his objection with filrther letters to the Council on 18th October, 29th October and Q 18th November, 1991. The last mentioned letter was sent only three days after he finally completed his purchase of the land. It made the further assertion that the Q applications for rezoning were not valid and ought not to be dealt with by the Council. He alleged that the applications were not in the prescribed form, did not specify the prescribed information and were not consented to by Partnership Pacific which he alleged to be the "owner" of the properties at the relevant time. The defendant also caused his solicitors to write directly to the plaintiff's customers (including W.D; and H.O. Wills and Castlemaine Perkins) alleging that the advertising was an illegal use of the land. -- 10 of 40 -- 11 Despite these disruptive tactics, the Council's Planning and Development Committee resolved on 20th November, 1991 to recommend approval to the Minister, subject to conditions which might be regarded as normal conditions. On 20th November, 1991 the defendant commenced proceedings in the Planning and Environment Court seeking declarations that the applications for rezoning were invalid. O'Sullivan D.C.J. ruled that she had no jurisdiction to hear the matter. The defendant subsequently appealed against this decision and on () 13th May, 1992 the Court of Appeal ruled that HerHonour had jurisdiction and that it should be heard and determined according to law. Such a further determination Q has however been overtaken by other events including the present action. There can be little doubt however that the defendant's actions, including the cominencement of those proceedings effectively frustrated any prospect of a prompt successful . rezoning based upon the favourable recommendation of the Council's committee. Having successfully impeded the progress of the rezoning application, the Q defendant served letters dated 11th December, 1991 enclosing form 10 notices under the Property Law Act dated 9th December, 1991. With respect to each lease the Q actual date of service is not clearly established, but I shall take it to be 12th December, 1991 which assumes immediate posting and one day delivery. In each instance the relevant content of the letter and notice were as follows: Letter "We act for Paul Makucha. We enclose a Form 10 Notice to Remedy Breach of Covenant, which was today served at the registered office and the principle place of business of Benmar Properties Pty Ltd. The Notice requires the lessee to remedy the breach within a reasonable time after service of the Notice. We are instructed that our client regards the period of three (3) months as reasonable notice to remedy the breach. If the breach is not remedied within that period, our client will regard itself as being justified in terminating the lease." -- 11 of 40 -- Notice 12 "With reference to the Lease of the demised premises dated 12th day of December, 1988, from Firewater Pty Ltd to Ventel Pty Ltd (which has changed its name to Benmar Properties Pty Ltd) and the covenant by the Lessee contained in clause 3.12 of the Lease to opserve, perform and fulfil all the requirements of any statutes, regulations, ordinances or by-laws so far as the same may apply to the demised premises or to the permitted use and the breach by you of that covenant the Lessor hereby gives you notice and requires you to remedy that breach by procuring the land to be included in a zone under the Town Planning Scheme for the Shire of Albert in which the land may be lawfully used for the purpose of advertising signs." ·' The plaintiff, rightly in my view, considered that it would be impossible to Q achieve the necessary rezoning in that time. I am satisfied on the evidence of Ms Vigar and of Mr Porter that it would be impossible to obtain such a result in Q three months, even with a co-operative landlord and no particular problem from objectors. In the light of the obstructive conduct already revealed on the part of the landlord, such a result was impossible within anything like the time foreshadowed. In January, 1992 Mr Irvine was able to arrange meetings with repr~entatives of the Council. During the first meeting he put his case, and at the second meeting Q a solution was proposed by the Town Clerk which in my view made any rezoning of development areas quite unnecessary. The proposal was to draft an amendment to Q the town plan which achieved what both the Council and the plaintiff had assumed the position to be, namely that if the licensing requirements of the Council with respect to advertising signs were observed, no further town planning consents would be required. The Council's solicitor, Mr Fynes-Clinton was in attendance and was asked by the Town Clerk to draft an appropriate amendment. In due course the Council proposed to the necessary amendment (apparently pursuant to s. 2.18(3)(b) of the Local Government (Planning and Environment) Act -- 12 of 40 -- 0 0 0 0 13 1990) and it was finally gazetted on 29th January, 1993 as cl. 7A in Division 1 of Part 2 of the town plan. It is in the following terms: " "7A Despite clauses 5, 6 and 7, a use of land:- (a) which consists only of the erection and subsequent display on particular land of a structure which is not a building (such as a advertising device); (b) in respect of which a licence, permit or registration must be obtained under some other law administered by the Council; and (c) in respect of which the required licence, permit or registration has been obtained and is in force, is a purpose for which the development may be carried out on the land concerned without the consent of Council. Subject to compliance with that other law, such a purpose does not cease to be one to which this clause applies by reason only of changes in the appearance or consent of the display from time to time or by reason only of the carrying outfrom time to time of work for the purpose of changing its appearance or content". I have upheld the validity of that amendment in a judgment published today in the associated action of Makucha v. The Shire of the Council of Albert and Benmar Properties Pty Ltd (No. 671 of 1993). Once this alternative solution was put in train, it might have been thought futile to pursue a rezoning application as such. However, it was not a foregone conclusion that the amendment would be made, and the plaintiff also sought to achieve rezoning. On 13th March, 1992 it sent to the defendant's solicitors a request for the defendant's endorsement (as owner) of the rezoning application. No such endorsement has ever been forthcoming. On 20th March, 1992 the defendant served notices dated 18th March, 1992 demanding immediate possession of the relevant properties. These were accompanied by notices demanding the removal of the signs thereon, failing which -- 13 of 40 -- 14 the defendant would arrange for them to be removed and stored at the plaintiff's cost. The present action was commenced on 15th April, 1992. On 19th June, 1992 the defendant filed a complaint in the Magistrate's Court under the lustices Act alleging breaches of cl. 5(3) of the Town Planning Scheme on the part of the plaintiff on 21st April, 1992. The matter was brought on before a Magistrate at Beenleigh on 25th August, 1993 (very shortly before the commencement of the present trial). The Magistrate found the complaint made out, ordered that no conviction be recorded, Q and fined the plaintiff $500 on each charge and ordered the plaintiff to pay costs to the defendant complainant. It was not submitted that any estoppel arises in Q consequence of this proceeding, and in any event an appeal is intended · by the plaintiff. The relevance of this particular episode is difficult to fathom, but it was presented as part of the history. It is consistent with my view that until cl. 7 A was inserted into the relevant town plan, the zoning was inappropriate for the plaintiff's activities, and in the absence of special town planning consent, advertising was Q prohibited within the existing zoning. I do not propose to recite the evidence concerning dealings between Aosco Q and Benmar, ·or other arrangements made by Benmar in relation to the sign and the disposition of the income which is generated by the signs. Benmar is the lessee and . it is the party which must defend the threatened invalidity or determination of the lease. It is also the party that is in the position to earn the income from the use of the leased land. Similarly the fact that other parties may or may not have an interest in the sign does not in my view affect the question of relief against forfeiture, and I did not understand Mr Douglas in the end to make any submission -- 14 of 40 -- 15 suggesting that any relevance attaches to the inter-company dealings i.n question. I therefore do not propose to lengthen these reasons by canvassing that area. On 25th February, 1993, following a renewal of the risk that the defendant might physically interfere . with the signs notwithstanding the pendency of proceedings, Moynihan S.J .A. granted an injunction against the defendant preventing any such removal. The defendant appealed against that order, and the appeal was dismissed on 21st May, 1993. 0 Validity of the leases The principal submission is that insofar as the lease subdivides land, it is Q prohibited by s. 34(8)(c) of the Local Government Act 1936- 1985. 0 (J Subdivision for the purposes of that Act is defined in s. 3 as follows: "'Subdivision,' 'subdivide,' and similar expressions mean and refer to dividing land into parts, whether the dividing is - (a) By sale, conveyance, transfer, or partition, or (b) (c) By any agreement dealing or instrument inter vivos (other than a lease for any term not exceeding five years without right ofrenewal) rendering different parts thereof immediately available for separate disposition or separate occupation, or By procuring the issue of a certificate of title under 'The Real Property Acts, 1861 to 1887', in respect of a part of the land." Section 34( 1) provides: "A person or corporation shall not- (a) cause to be opened a new road; (b) cause land to be subdivided, except in accordance with this Act." Section 34(8) provides as follows: "(8) Preliminaries to subdivision. In a case where a subdivision does not provide for the opening of a road, land shall not be subdivided until- -- 15 of 40 -- 16 (a) An application in respect thereof, accompanied by plans (which plans, if the Local Authority so requires, shall show the contours ·.of the land and all known flood levels), has been approved under this Act; and (b) Any necessary works have been carried out in accordance with the requirement~ of the Local Authority or as may· be pre5cribed by by-law; (c) (d) A plan of the subdivision bearing the signatures of all necessary parties, and a statement containing such particulars as may be necessary to identify the title to the land comprised in such plan, has been approved by a notation of approval under the seal of the Local Authority, including a certificate that all the requirements of ·the Local Authority and of this Act and of any by-law have been complied with; The plan so noted under the seal of the Local Authority, and endorsed with the approval of the Local Authority, has been registered in the office of the registrar of titles: Provided that such plan shall be lodged for registration within six months after the date of the notation of approval of the Local Authority on such plan." Section 34(9) provides: "(9) Registered plans to be deposited. A copy of every such registered plan shall be deposited at the office of the Local Authority and there recorded, and upon any failure so to do within one month after such plan has been so registered in the office of the registrar of titles the applicant shall be liable to a penalty not exceeding forty dollars." Section 34(17) provides: "(17) .Restriction on registration of instruments. It shall not be lawful for the registrar of titles to register any instrument dealing with land in a subdivision unless the plan of subdivision (with all roads, if any), bearing the approval of the Local Authority, has been registered, or unless in one of the cases following, that is to say - ... " (The cases then specified are not relevant for present purposes.) Prima facie the leases are instruments rendering different parts of a parcel of land immediately available for "separate occupation". This is so even though the occupation is of a limited kind and is confined to the use in the land for a limited purpose. I note however that the s. 3 definitions apply "unless the context otherwise 0 0 0 0 -- 16 of 40 -- ·~~~~~~~---~-~-~----·-·· ---- ----~---- 17 indicates or requires", and there are substantial arguments to the effect that some parts of s. 34 can sensibly apply only to subdivisions in the better understood sense of activity which causes separate titles to be created from an existing title. The main requirements of s. 34 concerning the production of plans necessary for subdivisions, and their ultimate perpetuation by the Registrar of Titles are contained in sub-ss. (6), (8) and (17). Sub-section (6) deals with the requirements when roads need to be opened and sub-s. (8) deals with the situation where the 0 subdivision does not provide for the opening of a road. Sub-section (17) makes it unlawful for the Registrar of Titles to register any instrument dealing with "land in a 0 subdivision" unless the plan approved by the local authority has been registered. The registration of plans of subdivision is also contemplated by s. 119 of the Real Property Act 1861, but there is no extended definition of subdivision for the purposes of that Act. It seems to me that that section has in mind what might be called the conventional notion of subdivision, namely the creation of additional titles Q out of an existing title. Such subdivisions are treated as effected by the registration of the relevant Q plan of subdivision. Section 119(4) provides: "119(4) [Proprietor to apply] Whenever land under the provisions of this Act is subdivided, the registered proprietor thereof shall, after the plan of subdivision has been registered, apply forthwith to take out and receive in his own name, a certificate of title for each such subdivision of the land so subdivided as the Registrar, having regard to the number of subdivisions shall deem necessary or expedient for the orderly registration of dealings therewith." It is impossible to read that provision as contemplating the more artificial concept of subdivision by lease. This is a strong indication that the "subdivision" contemplated by s. 119 is what I have called a conventional subdivision. This is further supported by the title of the section "When new certificates of title to issue -- 17 of 40 -- 18 in respect of subdivisions of land". The indications are not all one way however, and s. 119(3A), which was inserted in 1976, refers to the times prescribed by s. 34(6) and 34(8) of the Local Government Act. . I note however that s. 119(3A) refers specifically to "a plan lodged for registration" which is the language of subdivisions of land leading to the issue of new certificates of title, but not the language or practice of subdivisions by lease. In the latter instance, I do not consider that the Real Property Acts require the lodgment as such of a plan for registration, although the distinction is a fine one. In the ordinary course where a lease is granted with Q respect to part only of land the subject of an existing title, a plan will be included as part of the lease, and the lease as such will be registered. In this indirect way the plan may be regarded as becoming part of the register under ss. 32 ·and 35 of the Real Property Act 1861. However there is no reason why some leases might not be registered without such a plan, as for example where a metes and bounds description would suffice. 0 The need for proper delineation of leases of part only of a parcel of land is Q adequately protected by s. 120 of the Real Property Act 1861 which relevantly gives the Registrar discretionary power to "require the proprietor ... desiring to transfer, Q lease or otherwise to deal with the same or any portion thereof to lodge for registration ... a plan of such land in the prescribed form, certified by a licensed surveyor ... ". In other words if he sees fit to do so the Registrar can with respect to a lease impose plan requirements as rigid as those required for subdivisions under s. 119. However he is not obliged to do so, and in the ordinary course a simpler less expensive survey plan will be. sufficient to permit the registration of a lease. The prescribed form (and other regulations. governing surveyors) would seem to contain far more onerous requirements such as the inclusion of permanent pins, spikes and -- 18 of 40 -- 19 other data which are not required in the case of leases. By contrast form 8 prescribed under the Real Property Regulations 1986, which is the prescribed form of lease, has provision for "description of land" and for "description of land being leased (demised premises)". The form contains a note - "sketch plan of leased area must be in accordance with Registrar's guidelines". I do not propose to pursue the guidelines or the matter further. Quite plainly the legislation, regulations and forms all contemplate different practices with respect to subdivision by lease than for the 0 subdivision of land as generally understood. The practices that have developed are in separate streams. This, with respect, seems sensible, and accords with the 0 construction I have given s. 119. It is generally undesirable that subdivisions by lease be visited with the same expensive provisions as are thought necessary in order to identify separate titles. Unfortunately the Local Government Act was not drawn with such a distinction clearly in mind, and the one principal provision, the rather lengthy s. 34, Q purports to cover all forms of subdivision; although the one principally in the mind of the drafter seems to be subdivision of land into separate titles. The consequence of Q this is the raising of some difficult questions of construction as to the effect of s. 34, and in particular, s. 34(8). Mr Douglas Q.C. for the defendant submitted that the requirements of s. 34 are "mandatory not directory". I prefer the approach expressed in Attorney-General ex rei Franklins Stores v. Lizelle Pty Ltd (1977) 2 N.S.W.L.R. 955. In that case Reynolds J .A. considered the question whether non-performance of a requirement prescribed by a statute should be regarded as a condition precedent to the validity of subsequent dealings. His Honour said (at pp. 963-964): "In the solution of similar problems, it has been customary for courts to categorise statutory pre-requisites as being, on the one hand, -- 19 of 40 -- 20 mandatory or imperative and, on the other hand, as directory. This is but a compendious way of stating that, in some cases, the legislature intended that failure to comply with certain requirements would result in the invalidity of the Act to which these requirements were precedent or that, on the other hand, non-fulfilment of the requirement did not result in the invalidity of the Act." His Honour further observed: "Upon the basis of the consent so issued, companies may be formed, capital subscribed, buildings erected and commitments of all kinds made. Is the legislature to be presumed to intend that, at any time after the issue of the consent, its validity is to be open to impeachment to the detriment of all who acted on the faith of it? Did the legislature intend that those who wished to rely upon a development consent should seek to ascertain whether in the particular case consultation was required and, if so, whether the private files of the council and the referee evidenced it? Did it intend that, if the answers to inquiry were favourable, but incorrect, the person acting should remain unprotected? To my mind these questions suggest an answer." The practices followed with respect to the leases in the present case were those which have been followed for many years by local authorities, the Registrar of Titles, private practitioners and the public alike. That is not to say that such 0 0 practices are in conformity with the law, or that proper construction should give way Q to general practice. It is to say however that all the actions taken by all parties in relation to the leases in question (including the defendant's predecessor in title, Q Firewater) were done in good faith and in the expectation that valid leases would result. It is necessary to look at each paragraph of s. 34(8). I am satisfied that in each instance, insofar as a subdivision was sought, an application in respect thereof, accompanied by plans, was approved by the local authority. Plainly the only necessity for such an .application arose under the Local Government Act, and the approval was under that Act. Exhibit 20 (the Council file) shows that in each instance there was initially an application for subdivision of land, examination of it -- 20 of 40 -- 21 by Council officers, reference to the relevant Council Committee, approval by the Committee, approval by the Council, and reference back to the: designated officers of the Council (including the Town Clerk) for the.sealing of the appropriate survey plan. In each instance there was a further "application for sealing of survey plan" lodged by the plaintiff's surveyor. I accept the evidence of Mr Moore (the Town Clerk) as to the usual sequence and in particular accept that it is the proposal for subdivision with which the Council is concerned. There is no necessity in my view Q that the eventual survey plan be placed before the Council as such. It was submitted that the leases were "never sighted by Council". I am not sure whether they were or 0 not, but the real point is that relevant applications and proposals for subdivision were considered by the Council and approved. Not only were the initial proposals approved, and the relevant forms signed by duly authorised officers of the. Council; by subsequent resolutions the Council expressly ratified the affixation of the seals with respect to the transactions in question. 0 There is no deficiency in relation to compliance with ss. 34(8)(a) or 34(8)(b). However there is more substance in the allegation that some of the Q requirements of sub-s. 8(c) were not satisfied. It will be suffident to consider the question with respect to one of the leases and I shall take that with respect to lot 2. Page 20 of ex. 19 shows the relevant plan that forms part of the lease, and p. 18 shows the Council's endorsed consent (under seal although the photocopy does not show it), also forming part of the lease. I cannot recall any submission as to who are the "necessary parties", and the Local Government Act does not readily supply the · answer. In the event it is signed under the common seal of Ventel and is also endorsed by the surveyor applicant. It is capable of being regarded as a plan of the -- 21 of 40 -- 22 subdivision, and.it certainly contains such particulars as are necessary to identify the title to the land comprised in the plan. The next question under sub-s. (S)(c) is whether that plan "has been approved by a notation of approval under the seal of the local authority ... ". The Council has not done so in those precise words. What it has done, under its seal, in the words of the Real Property Act general consent form, has been to "consent to the registration of the instrument specified ... "~ Can this be regarded as a notation of approval of the plan of subdivision which appears two pages further on in the same instrument? Q I am inclined to hold that it can be and that it is. The consent to the registration of the' instrument that effects that notional subdivision is necessarily an approval of Q that plan of subdivision and of no other. That is indeed the premise upon which the practice has grown up, and upon which the relevant public bodies and officials have sought to comply with the requirements of the Act. If however they and I are wrong about this, the non-compliance can only be described as a trivial and technical oversight with no possible adverse effect upon the rights of any citizen. 0 The final requirement of s. 34(8)(c) is that there should be included "a certificate that all the requirements of the local authority and of this Act and of Q any by-law have been complied with". This plainly was not included. The submission does not suggest that any relevant by-law was not complied with, and it is simply the absence of a certificate saying so that is relied upon. I must therefore hold that the notation of approval did not include a certificate to that effect and· that that particular requirement of the sub-section was not complied with. However I find it difficult to infer any intent· on· the part of the legislature that in the context of an application of this kind. the omission of such a certificate should render invalid the subdivision or the lease. -- 22 of 40 -- 0 0 23 It was further pleaded by the defendant (in para. 19 of the defence and counterclaim) that "no such plan was registered in the office of the Registrar of Titles". It may be a moot point whether the relevant plan in a lease that effects a subdivision is ever registered as such, but on one view it is registered in the office of the Registrar of Titles, as the lease of which it forms a part has been registered there. In Rock v. Todeschino (1983) Qd.R. 356, McPherson J. considered, without expressly deciding, that a plan of subdivision identifying an easement was itself an "instrument" which was. registered upon entry by the Registrar of Titles on the Certificate of Title for the relevant land of the. appropriate memorial of subdivision by means of the plan. In the present case the actual title reveals the relevant leases. On lot 2 ·instrument of lease J962567M is recorded on the title, and particulars of the lease are stated as "of part of the land to Ventel Pty Ltd ... " (see ex. 14). Sections 32 and 35 of the Real Provertv Act 1861 support the suggestion that the plan, upon registration of the lease, is also registered. If this is not correct, Q it serves to emphasise the inappropriateness of the wording of s. 34(8)(d) of the Local Government Act if it is intended to be applied to subdivisions by lease. Q My conclusion with respect to s. 34(8)(d) is that the relevant plan has been registered in the office of the Registrar of Titles. However that the plan is not itself noted or endorsed with the approval of the local authority; this is only contained in the separate consent within the same lease document. Mr Douglas further submitted that under the proviso to sub-s. (8), the plan was not lodged for registration within six months of the date of the local authority's approval. This was based on. the premise that the only approval of the local authority was that with respect to the earlier withdrawn leases. However I consider that separate applications were made with respect to each lease and that the · -- 23 of 40 -- 24 approvals in question related to the leases that are in issue in the present proceedings. The leases (including the relevant plans) were lodged for registration well within the six months of the "date of the notation of approval" which date was 6th June, 1989 for each lease. Indeed, they were lodged on 29th June, 1989. Thus far then, the defendant has succeeded in showing what I regard as two minor omissions with respect to the multiple requirements of ss. 34(8)(c) and 34(8)(d) of the Local Government Act. ,· 'It was further submitted that the Registrar of Titles acted unlawfully in Q registering- the leases in contravention of s. 34( 17) of the Act. This sub-section has been set out earlier (at p. 15). For the reasons already stated (pp. 17-19) I do not Q consider that the Registrar acted unlawfully in this instance, although I recognise the difficulty. of reading 'all the relevant statutory provisions so as to obtain a tidy logical result. My reasons, briefly stated are - (a) Sub-s. (17) expressly mentions the registration of a plan of subdivision. It is directly focused upon the 'registration of subdivisions by the Q Registrar of Titles. The only section in the Real Property Acts dealing with subdivisions is s. 119 of the Real Prooerty Act of 1861. The most Q sensible construction of this sub-section in the Local Government Act is that it has in mind subdivisions under s. 119 of the Real Property Act 1861, and no others. If this is correct, then at least in the context of this -sub-section, the provision is directed to conventional subdivisions and there is no additional requirement imposed upon sub-divisions by lease. I am aware that this involves application· of the qualification in the- definition section of the Local Government Act "unless the context otherwise indicates or requires" but in this instance, s. 34(17) of the -- 24 of 40 -- 0 0 0 0 25 Local Government Act and s. 119 of the Real Property Act can be read together far more appropriately if the legislature is taken to have been· contemplating the same kind of. subdivision, namely the conventional subdivision rather than the special extended inclusion of subdivision by lease. Both the Real Property Acts and the Local Government Acts are important legislative measures. It is true that the provisions in the Local Government Acts were passed later in point of time and if the two Acts cannot be read sensibly together the latter will prevail. However it seems to me that the Acts can only be read together sensibly by treating s. 34(17) of the Local Government Act as relating to subdivisions to which the Real Property Acts apply.·. (b) Assuming to the contrary that notional subdivisions by lease are intended to be covered by s. 34(17), the relevant plan of subdivision was that contained within the lease. For the reasons given above, I incline to the view that that plan has been registered upon the registration of the lease. This leaves as the only arguable deficiency that the registered plan of subdivision is not one "bearing" the approval of the local authority. The deficiency is that the approval of the local authority is endorsed, not on the plan, but on a special form within the document of which the plan forms a part. The. deficiencies in satisfaction of the requirements of s. 34 are therefore limited to two minor omissions arising under ss. 34(8)(c) and (d), and, arguably, the same deficiency under s. 34(17). It was further submitted that the registration was contrary to s. 119 of the Real Property Acts 1881. I have already stated why I consider that that section does -- 25 of 40 -- 26 not apply to subdivisions o.f the. present kind. I shall however discuss the alleged breaches of s. 119 on the footing that this view is incorrect. If s. 119 applies to a subdivision of this kind, the proprietor would be obliged by sub-s. l(b} to "lodge for registration" a plan of subdivision which "shall show distinctly . delineated therein every separate and distinct subdivision into which the land is, by the plan, divided marked with a separate and distinct number or symbol". Now whilst the plans within the leases adequately delineate the subdivision, they do not. mark the two parts with different numbers or symbols, unless the hatching is to be regarded as a symbol. Further, those plans are not "certified as accurate by a licensed surveyor" (under s. 119(1}(c}} although the surveyor's name appears thereon. It is hardly surprising that s. 119 has not been complied with, in that neither the plaintiff's advisors nor. the Registrar of Titles thought this section applicable to the registration of such leases. The practice of the Registrar in such matters is succinctly stated at p. 366 of ex. 19. 0 0 On this footing then several omissions of ·the requirements of s. 119 would be Q shown. However, in my view so far as leases are concerned, those persons effecting subdivision by leases are bound by the provisions of the Local Government Acts, but 0 when they. come to register their leases, they are not subjected to the additional hurdle of s. 119 of the Real Property Act. They will be governed by familiar provisions which include ss. 52, 65 and 120 of the Real Property Act 1861 and forms 8 and 35 of the Real Property Regulations 1986. No irregularities are shown under the Real Property Acts. if this view is correct. The question then is whether two minor omissions arising under ss. 34(8}(c} and (d), and arguably, the same deficiency under s. 34(17}, bring about the invalidity of leases subsequently registered. -- 26 of 40 -- 0 0 27 Mr Douglas who presented his submissions with admirable conciseness, which I am unable to match in dealing with them, relied primarily upon two decided cases, re Lehrer and the Real Property Act (1961) S~R.N.S.W. 365 and Travinto Nominees Pty Ltd v. Vlattas (1972-1973) 12~ C.L.R. 1. In re Lehrer, jacobs j. expressed the view (obiter) that under similar legislation in New South Wales, a local Council could not give a qualified approval of a subdivision such as "for leasing purposes only". His Honour did not consider that such a provision was truly a condition (p. 373). This does not traverse any submission upon which the plaintiff relied, but it underlines the difficulty of applying a separate stream of requirements to subdivisions by lease when such subdivisions are caught up in a wider definition. The . principal propositions are that the later enactment (the Local Government Act) prevails over the Real Property Act, that the requirements of s. 34 are mandatory and not directory, that the Registrar is bound not to register in breach of s. 34(17), that no indefeasibility of title results from the registration of Q . the relevant interest, and that the plaintiff should be compelled to execute such documents as will cause the register to be rectified to remove the current Q registration. The legislation in the Travinto ·Nominees case was an industrial arbitration section which expressly rendered void, unless the Industrial Commission had approved of its terms, any contract under which a person leased or agreed to lease any premises for the purpose of hairdressing. It was conceded in argument that the legislation invalidated the lease, but the question arose whether the registration under the Real Property Acts had validated the lease and to what extent. The ratio is that registration of the lease did· not validate the covenants to renew the lease. -- 27 of 40 -- 28 The headnote· in my view is not entirely accurate. Barwick: C.1 ., with whom McTiernan 1. agreed, discussed the notion of indefeasibility as follows: (p. 17) "Though as a term 'indefeasibility' is convenient enough, it must always be remembered that it is the title to and possession of the land or of the interest in the land of which there is· a registered proprietor which is rendered secure by the registration. In the case of a leasehold it may be and frequently is the case that the extent of the leasehold interest is not merely described by reference to a term of years but must of necessity be determined by reference to the operation and effect of those terms and conditions of the lease which affect or qualify the interest in the land which the lease purports to create. It may be noted that the Real Property Act recognises that there may be . terms' and conditions in the memorandum of lease, see the Real Property Acts. 53(3). These considerations seem to me to result in the conclusion that registration of the memorandum of lease does not ensure the validity of every term and condition of the lease or indeed of the enforceability of every covenant it contains." Menzies 1. said (pp. 29-30): "Here,' because of the effect of s. 88B of the Industrial Arbitration Act, the tenant was not entitled to register the memorandum of lease as there was no lease. If a person becomes registered in such circumstances, the Registrar-General can cancel the registration: s. l36, Real Property Act. The registration did not, in my opinion, validate an option in a lease given contrary to a statute. Accordingly, I do not find 'it necessary to consider the· observations contained in the New Zealand cases cited as to whether registration under the provisions of the Real Property Ac.t creates indefeasible rights in respect of each and every covenant of the lease which is registered." Contrary to what the headnote suggests, Menzies 1. confined his agreement with Gibbs 1. 's opinion to the question of estoppel. Gibbs 1. said (at pp. 33-35) that there could be no doubt that the Real Property Act had the effect that "upon the registration of a lease the lessee obtains a title to the estate or interest specified in the lease notwithstanding that apart from registration the lease would be void and ineffective" and that "that title is immune from attack". However His Honour went ori to hold that the Industrial Arbitration Act was passed subsequent to the Real Property Act and that effect must therefore be given to its provisions notwithstanding any contrary provision in the Real Property Act. His Honour 0 0 0 0 -- 28 of 40 -- - --- ---- ---~-- ---......... 29 concluded that the later enactment contained "clear language from which it is plain that its provisions were intended to apply to land under the Act and to apply in a manner inconsistent with the Real Property Act". His Honour considered that "the provisions of s. 880 on their proper interpretation operate to avoid a lease, to which they apply, whether or not the lease is registered under the Real Property Act''. His Honour distinguished Breskvar v. Wall (1972) 126 C.L.R. 376, observing that in that case it was held that the two statutes (the Real Property Acts (Q) and the Stamp Q Act) could stand together. It is not necessary to pursue the true ratio of Travinto Nominees, as it is plain that the necessary exercise is one of statutory construction Q and an analysis of the extent to which the. later statute makes it clear that the indefeasibility provisions of the Real Property Acts are to be disregarded. The Local Government Act (s. 34) is certainly not as clear as the Industrial Arbitration Act provisions. The transaction is not expressly voided, although there is a prohibition upon persons causing land to be subdivided except in accordance with Q the Act. That is not necessarily inconsistent with a "substantial compliance" construction. Again, although s. 34(17) impliedly prohibits the Registrar of Titles Q from registering certain instruments, there is no express statement destroying the indefeasibility provisions in the event that he does register the instruments. In the spectrum of statutory provisions that prohibit activity and state the consequences thereof, the legislation might be thought to fall somewhere in the middle. Mr Douglas placed reliance upon the decision of Davidson A.J. in Roseville Extended Limited v. Lucas (1926) 26 S.R.N.S.W. 402. His Honour held that the Local Government Act of 1919 (N.S.W.) impliedly prohibited subdivisions without the consent of the local Council and that successful registration of a subdivision into a number of allotments under the Real Property Act did not result in valid -- 29 of 40 -- 30 Certificates of Title being issued. That decision was thought by Mason J. (as he then . was) not to have survived .Frazer v. Walker (1967) 1 A.C. 569, in the New South Wales Court of Appeal .decision in Travinto Limited v. Vlattas (1972) 1 N.S.W.L.R. 24, 47. I respectfully agree, and consider that Roseville Extended should not be followed, particularly in the light of Moffitt P's analysis in Southerland Shire Council v. Moir (1982) 49 L.G.R.A. :115, 116. - "It was decided by Davidson A.J ., as he then was, in Roseville Extended · Ltd v. Lucas (1926) 26 S.R. (N.S.W.) 402 that, where an Act prohibits the doing of an act, which, in consequence of it, would alter the title to land (in that case, as in the present case, a subdivision without following the procedures prescribed by the Local Government Act), the registration under the provision of the Real Property Act of the change in the title to land is inoperative so far as it is contrary to the prohibition. As Mason J ., then a judge of this court (in Travinto Pty Ltd v. Vlattas [1972] 1 N.S.W.L.R. 24, at p. 47) pointed out, with respect correctly, this decision was in effect overruled by the Privy Council decision in Frazer v. Walker [1967] 1 A.C. 569. A good title will arise from registration of it, although that title was derived from acts or instruments which were void or were rendered so by another Act of Parliament." I turn then to the submissions of Mr Muir Q.C. for the plaintiff. I reject his primary submission that s. 34(8) of the Local Government Act does not apply to notional subdivisions by lease. I can see sufficient reason for departing from the wide definition of "subdivision" in the particular context of s. 34(17) but there is no sufficient reason to deprive the definition of practical effect by failing to apply it to any part of s. 34 which is after all the only section dealing directly with the subject of subdivision. It was submitted that it is a sufficient compliance with the requirements of s. 34(8) if the local authority's approval is not on the plan itself but is contained in a document of which the plan forms part. Reference was made to Brisbane Unit Development Corporation Pty Ltd v. Deming No. 456 Pty Ltd (No. 2) (1983) 2 Qd.R. 92, 96; 155 C.L.R. 129 where compliance within the body of a larger document was .o 0 0 0 -- 30 of 40 -- .. 31 held sufficient compliance with a statutory requirement for a prescribed statement in writing to contain a particular detail. It was further submitted that substantial compliance is all that is required, and that the wording of s. 34 does not demonstrate an intention to render instruments of lease which may bring about a notional subdivision void or unlawful. There are strong policy reasons why parties to a lease and persons who might subsequently deal with the subject land such as mortgagees and assignees ought to be entitled to rely on the register in order to ascertain their Q rights. He further submitted that the Real Property Act and the Local Government Act can be read together without necessitating the destruction of indefeasibility that Q the Real Property Acts provide. It is difficult to find in the Local Government Act any clear language that its provisions were intended to apply in a manner inconsistent with the Real Property Act, although the illegality ·of the Registrar's actions if they are in brea~h of s. 34( 17) could be taken as destructive of further consequence. There is nothing Q however in sub-s. (17), or elsewhere, which makes it plain that the indefeasibility of subsequent registered titles is to be overridden. Q The final submission on behalf of the plaintiff on the issue of validity of the leases is that once registered, the lessee's interest obtains the benefits of indefeasibility. Even a registration which results from a void instrument is effective once registration is obtained (Breskvar v. Wall (1971) 126 C.L.R. 376, 385). The only power in the court to cancel an entry in the register book is that ins. 124, and those circumstances do not apply here. In some circumstances the Travinto Nominees case may require a registered interest to be disregarded, but ~hat will depend upon the terms of the legislation. -- 31 of 40 -- 32 The question then is whether the relevant legislation, of which some breaches have been established, is such as to render illegal and void the lease from Firewater to Ventel notwithstanding its registration in the Titles Office. The breaches in question are of two matters ins. 34(8) and, possibly, of one aspect of s. 34(17). They are breaches of requirements which are devoid of practical consequence, either in the circumstances of the particular case, or even generally in the context of subdivisions by lease. No person would be better off, and the public would not be better protected if they were complied with. The breaches are not in my view of substantial matters and may fairly be described as trivial. 0 The reference to indefeasibility is a convenient description of the immunity Q from attack by adverse claim to the interest in respect of which a person is registered (Frazer v. Walker (1967) 1 A.C. 569, 580). Mention may be made of two New South Wales decisions, although they are not sufficiently close to provide direct guidance. In Attorney-General (N.S.W.) ex rel Franklins Stores v. Lizelle (referred to earlier), on the assumption that there was a statutory requirement for the local Council to consult with a planning authority before granting an interim development application, Reynolds J .A. and Hutley J .A. considered that such a failure would not render the Council's consent invalid. In that case there had been no compliance whatever with such a requirement, and it was not possible to argue substantial compliance. Their Honours were of the view that despite non-compliance, it should not be inferred that the Council's consents should be rendered invalid. It would seem that matters of public convenience, and the perceived undesirability of encouraging third parties, after assiduous search, to undo the validity of bona fide decisions on which other persons might reasonably act, may have played some part in this conclusion (see pp. 963-965, 969, 980). In McRae v. Coulton (1986) 7 N.S.W.L.R. 644, 0 0 -- 32 of 40 -- 0 0 0 0 33 an application which contrary to the requirements of a statute failed to give particulars and failed to provide plans was held to be a sufficient compliance with the statutory requirements, and that invalidity did not follow the lack of strict compliance. The approach of Step hen J. i~ Victoria v. The Commonwealth and Connor (1975) 134 C.L.R. 81, 179 in my view has more direct relevance to the present case: "A directory construction will not assist in securing validity unless, despite the non-compliance which is the occasion for invoking that construction, there may nevertheless be seen to be substantial compliance with the general object at which the statutory provision aims. Sometimes the stipulation which has not been complied with is, in its context, so relatively unimportant to the attainment of that general object that, although there has been total non-compliance, a directory construction may be appropriate. In such cases it may not matter that the non-compliance is complete, not partial. Indeed the stipulation in question may be of a kind which is incapable of partial compliance; to give to such a stipulation · a directory interpretationrecognises that it may be wholly disregarded without prejudice to validity because of its relative unimportance in the attainment of the general statutory object and also, perhaps, because of the far-reachingand undesirable consequences of treating its non-observance as invalidatory." In the present case there has been substantial compliance with the perceived general object of s. 34 of the Local Government Act, which is essentially the fair consideration by local authorities of subdivisions and the ensuring of proper identification of the areas subdivided. In my view there has been substantial compliance with the section's requirements, and the points of non-compliance do not lead to the result that the whole exercise was a nullity. If the above conclusion is wrong, and if the lease was, prior to its registration, a void instrument, "the enquiry must be whether the later Act avoids the registered interest, not merely some document or transaction from which the title to the registered interest derives" (per Connolly j. in Rockhampton Permanent Building Society v. Peterson No. 2 (1989) 1 Qd.R. 670). In the present case the lease was -- 33 of 40 -- 34 already registered before the defendant acquired any interest in the land, and he took with full notice of the plaintiff's registered interest.·· It may not be unrealistic to infer that the purchase price was significantly reduced by the existence of that registered interest. It is not lightly to be inferred that the legislature intends consequences to the effect that trivial omissions in the performance of a statutory scheme will destroy future dealings in the scheme of statutory title under the Real Property Acts. I would distinguish the legislation from that considered in the Travinto Nominees case and hold that the interest obtained by the plaintiff under the Q Real Property Acts has not been voided by any non-compliance by the Council or the plaintiff under the Local Government Act. Although not all terms or covenants of a 0 lease are necessarily validated by registration, the grant which creates or qualifies the estate or interest is preserved (compare P.T. Limited v. Maradona Pty Ltd (1991) 25 N.S.W.L.R. 643) unless some other statute requires a contrary conclusion. If I am wrong on practically every point above, the plaintiff's fall-back position seems to be as follows. The defendant derives his title. from Firewater, 0 having purchased the reversion after registration of the leases in question. Let it be assumed that the leases are prohibited conditionally, that is to say the subdivisions Q cannot be regarded as having occurred unless and until the provisions of s. 34(8) have been strictly complied with; that the substantial compliance is insufficient; and that no valid consent yet exists for the subdivision. Even on these assumptions, the plaintiff should still have the opportunity of obtaining the necessary consent and of fulfilling the necessary requirements. The defendant, who took his interest in the land with· knowledge of this conditional grant by his predecessor could not be heard to object to such ari ·opportunity being afforded the plaintiff to perfect the grant (~f. Misiaris ~. A.F.C. Holdings Pty Ltd (1988) 15 N.S.W.L.R. 231, 232, 234, 236), and -- 34 of 40 -- 35 should be obliged to provide such co-operation as rr:iay be necessary to enable the grant to be perfected (cf. Gaye (No. 1) Pty Ltd v. Allan Rowlands Holdings Pty Ltd H.C. 30th June, 1993, (1993) 13 Leg.Rep. 10). I need not pursue this prospect further, as I consider that the registered lease is valid. The plaintiff also submits that the plaintiff is estopped from contending that the lease is invalid because the defendant from an early stage asserted his position oi as lessor and represented that the plaintiff should remedy the alleged' breach by taking all necessary steps to rezone. Benmar infact spent considerable time and Q money in attempting to do so. As early as 27th December, 1990 solicitors had stated their client's intention to require strict compliance. The defendant, also at a fairly early stage orally suggested to one of the plaintiff's directors that the leases were "invalid" arid it is submitted on behalf of the defendant that he thereby kept his options open and that the plaintiff cannot rely upon the assertions of . breach as Q founding an estoppel. The matter is quite arguable, but it is enough at this stage for me to indicate that were I of the view that the lease is invalid and that it does not Q bind the parties, I would not regard that the defendant has estopped from clain:iing in court that it is invalid and seeking a determination accordingly. Termination of the leases By cl. 3.12 of the lease, the lessee was obliged to observe all the requirements of statutes, regulations, ordinances and by-laws so far as they applied to the demised premises or to the installation and maintenance of the sign and advertising thereon. Under the Town Planning Scheme for the Shire of Albert (pursuant to Order in Council of 17th March, 1988) an advertising sign is a "structure", the use of any structure on land is "development", and the purposes for which development may be -- 35 of 40 -- 36 carried out ·are specified in a table of zones pursuant to cl. 5 in division 1 of part 2 of the scheme. Under cl. 7(2) no person may erect or use any structure in any zone for a purpose set forth in column 5 applicable to that zone. The zoning at material times has been "special facilities (ski lake, roller skating and associated administration, club facilities, restaurant and take away food outlets)". The advertising in question was not ancillary to that use, and it would seem that at material times the zoning was not appropriate for the use in question. Accordingly, the defendant was correct when he alleged the existence of the breach. 0 In order to be able to forfeit the term, compliance with s. 124 of the Property Law Act was necessary. Although the lease provides for a right of re-entry, the 0 statute affords a locus poenitentiae to lessees, and the right to re-enter is postponed to the giving of the notice (Holden v. Blaiklock (1974) 2 N.S.W.L.R. 262). Under s. 124(l)(b), if the breach is capable of remedy, the notice must require the lessee to remedy it. If the lessee fails within a reasonable time thereafter to remedy the breach, the lessor's right of re-entry under the lease will become enforceable. 0 The breach was plainly one capable of being remedied, although the remedy was obviously not inevitably achievable. The expression of opinion on behalf of the Q defendant, in the accompanying letter, that three months was sufficient to remedy the matter was in my view quite unrealistic. The difficulty of remedying the breach was aggravated by the obstructive tactics with which the defendant persisted. It was submitted on behalf of the defendant that the plaintiff let three months elapse before _even commencing a fresh application for rezoning. It is difficult to see why the plaintiff should have needed to bring. a fresh application at all when he already had a pending application for an appropriate zoning, which was held up, as it seems to me, by legal action and .other activity promoted by the defendant. Furthermore, -- 36 of 40 -- ---------------~-·-~-~-~·--~-- 37 the alternative solution proposed by the Town Clerk, which eventually eliminated the problem, had already been proposed in January, 1992 .. The demand for possession, served on 20th March, 1992 was premature, as the plaintiff could not at that stage be said to have failed within a reasonable time after the receipt of the s. 124 notice, to have remedied the breach. Indeed, the achievement of the amendment of the town plan by the inclusion of cl. 7A therein, finally gazetted on 29th January, 1993 (13 months after the receipt of the s. 124 Q notice) in my view amounts to a remedying of the breach within a reasonable time. It eliminated the problem. 0 The purported termination of the leases on 20th March, 1992 was therefore ineffective. This is the only termination which has been relied upon for the purposes of the action. It follows that the· balance of the term of the lease has not been effectively forfeited and that no effective re-entry has occurred. 0 It becomes unnecessary to consider further arguments advanced on behalf of the plaintiff including - (a) the defendant himself breached cl. 3.08 by obstructing Q the plaintiff's attempts to remedy the breach, and he is precluded thereby from relying upon any failure on the part of the plaintiff; and (b) the s. 124 notice was served by the defendant when Firewater was still the owner of the properties, the defendant was not "the lessor" within the meaning of s. 124, and he was not entitled to issue the notice. Without expressing a concluded view on the latter point for which no authority was advanced, I incline to the view that the defendant was an "assign" within the meaning of the definition of "lessor" in the Property Law Act. As the purchaser under an executory contract, he had an equitable interest, and the title -- 37 of 40 -- •' 38 was subsequently made good by completion of the contract. It is however unnecessary to decide these issues. Relief against forfeiture In view of my primary findings, there is no valid forfeiture against which the plaintiff needs any relief. However because the issue featured so largely in the litigation I shall express my view on the assumption that the leases were validly determined on 20th March, 1992 by reason of a subsisting breach which the plaintiff had failed to remedy within a reasonable time. 0 A wide discretion is entrusted to the court in such an exercise (Property Law Acts. 124(2)); Shiloh Spinners Ltd v. Harding (1973) A.C. 691; Jam Factory Pty Ltd 0 v. Sunny Paradise Pty Ltd (1989) V.R. 584). The main factors that emerge in the present case are the following. The breach has been successfully remedied and it would seem that there is no prospect of its recurrence. It was not a breach which was of any particular concern to the local 0 authority which regarded its own licensing system as an adequate control measure in relation to the advertising activities of the plaintiff. On the other hand it was, on analysis, a breach of the town planning provisions, and this could have led to activity orf the part of the Council prejudicial to the owner as well as to the actual user. However the essential point is that there was a breach but it is over and done with. It was not a cynical breach, being the product of ignorance on the part of the plaintiff and the Albert Shire Council alike. In the event it has done no harm to the defendant other than the incurring of expenses which may be thought to be largely self-inflicted. In short, the plaintiff's default was not wilful; the breach did not in the event damage the position of either party; and there is a great disparity, at least from the -- 38 of 40 -- 39 plaintiff's point of view between the value of the interest of which forfeiture is claimed (a 99 year lease with 97 years to run) and the damage caused by the breach (which is negligible). From the defendant's point of view, the low rental ($1 per annum) is no doubt a factor which increases his desire to terminate it, but the gain to him (forfeiture of the remaining term of 97 years) bears a similar disparity to damage caused by the breach. Other submissions were advanced, two of them by the insertion of paras. B(s) 0 and 8(t) in the defence and counterclaim. The first of these alleges that the face of the trivision sign on .lot 2 is 12.34m by 3.44m, contrary to the description of the 0 lessee's sign in the lease which is 10.5m by 4m. This is said to be relevant to relief · against forfeiture as it demonstrates the existence of another breach which it is submitted is irremediable without the substantial destruction of the signs themselves. The answer to the submission is to be found in cl. 3.11 of the lease which relevantly provides: Q "Alterations to sign Provided the lessee is authorised to do so under any current ... permit or registration the lessee may ... replace, ... enlarge, ... and install a n substitute sign or otherwise deal with the lessee's sign whether '~· · structurally or otherwise ..." The alterations have always been with the consent of the Council, and are permitted by the lease. There is no merit in this particular submission. The allegation in para. 8(t) was that one of the signs encroached over the main road area. However the evidence failed to support that allegation. The present case is a plain one in which I would be disposed to relieve the lessee from the consequences of forfeiture if the lessor were otherwise .entitled to effect a forfeiture. -- 39 of 40 -- 'I "'\.. 40 Other matters The defence and counterclaim also alleges that cl. 8.09 of the lease is invalid and not binding upon the defendant. This does not appear to have remained a live issue, and despite my adversion to it, and Mr Douglas's seeking of instructions upon it, no submissions were made in support of it. The covenant in question seems designed to protect the rights of the lessee to use his signs as contemplated by the lease, and I can see no basis for the claim in question. I shall hear submissions as to the appropriate form of order. Prima facie the Q counterclaim should be dismissed and a declaration should be made in terms of para. (b) of the relief clause in the statement of claim. I shall hear submissions as to Q whether any injunctions or further declarations are necessary. 0 () -- 40 of 40 --