Quarry Street Pty Ltd v Minister Administering the Crown Land Management Act 2016

1. [1]

   WHITE JA: This is an appeal from orders of the Land and Environment Court dismissing an application for judicial review of a decision of the Minister Administering the Crown Land Management Act 2016 made on 10 December 2021 to approve in part an Aboriginal Land Claim in relation to Crown land in Paddington (Quarry Street Pty Ltd v Minister Administering the Crown Land Management Act 2016 [2023] NSWLEC 62).

2. [2]

   The appellant, Quarry Street Pty Ltd, is the lessee of a site described as the Paddington Bowling Club which formerly comprised a clubhouse, bowling greens, and tennis courts. The registered proprietor of the site is the State of New South Wales. On 11 December 2009, the site was subject to a Reservation of Crown Land pursuant to s 87 of the Crown Lands Act 1989 (NSW) (“Crown Lands Act”) for “Community and sporting club facilities and tourist facilities and services”.

3. [3]

   The site had been subject to a lease granted to Paddington Bowling Club Ltd from 19 May 1962 until 1 December 2010 (J [3]). A new lease was entered into with Paddington Bowling Club Ltd from 1 December 2010 for a term of 50 years. The lease was entered into when Paddington Bowling Club Ltd was either subject to a deed of company arrangement, or was under administration. It was entered into by the State of New South Wales by the Minister for Lands pursuant to s 34A of the Crown Lands Act. The initial rent was $52,000 per annum and was subject to annual CPI adjustments and three yearly reviews to market.

4. [4]

   Section 34A of the Crown Lands Act relevantly provided that the Minister could grant a lease over a Crown reserve for any purpose the Minister thought fit (s 34A(1)). The Minister was not to grant such a lease unless satisfied it was in the public interest to do so, and if due regard was had to the principles of Crown land management (s 34A(2)(c)).

5. [5]

   By cl 31 of the lease, the lessee was given the right to occupy and use the premises for the purpose of “Community and Sporting Club Facilities, Tourist Facilities and Services, Access”. The lessee was not to use the site or allow the site to be used for any other purpose. The lessee was not required to use the site for those purposes. The permitted (but not required) purposes broadly coincided with the purposes for which the land had been reserved.

6. [6]

   Perhaps unsurprisingly, given that Paddington Bowling Club Ltd was either under administration or subject to a deed of company arrangement, the 50 year lease that the administrator or deed administrator had obtained was transferred. The transferee was CSKS Holdings Pty Ltd (“CSKS”).

7. [7]

   That transfer must have been made with the consent of the Minister. The certificate of title had noted that “the land is a reserve within the meaning of Pt 5 of the Crown Lands Act 1989 and there are restrictions on transfer and other dealings of the land under that Act, which may require consideration of the Minister”.

8. [8]

   Clause 39 of the lease provides:

9. [9]

   Except for tennis courts at the northern end of the site, CSKS did not use the site for the permitted purposes. The bowling greens were unattended. The clubhouse fell into disrepair.

10. [10]

    On 10 April 2016, an officer of the Department of Land and Natural Resources required CSKS to remedy asserted breaches of the lease in relation to the state of repair of the clubhouse and grounds at the site, and foreshadowed the potential forfeiture of the lease.

11. [11]

    On 22 April 2016, the solicitor for CSKS denied the alleged breach of the lease. The solicitor stated that the director of CSKS had engaged a structural engineer and other building experts to advise him in relation to what works needed to be done on the property. He also said:

12. [12]

    On 19 December 2016, the NSW Aboriginal Land Council lodged a land claim pursuant to s 36 of the Aboriginal Land Rights Act 1983 (NSW) (“the ALR Act”) for all reserves within the meaning of s 78 of the Crown Lands Act within the boundary of the La Perouse Local Aboriginal Land Council (save for three specified areas). That boundary extends from northern Wollongong to North Head. It includes Paddington.

13. [13]

    This was a bulk claim. No question was raised on this appeal as to its validity (Minister Administering the Crown Lands Act 1989 v NSW Aboriginal Land Council [2018] NSWLEC 26).

14. [14]

    On 1 February 2018, the Minister consented to an assignment of the lease from CSKS to the appellant, Quarry Street Pty Ltd, subject to various conditions. One of the conditions was that the appellant acknowledged that the land was subject to an undetermined Aboriginal Land Claim and that if the land or any part of it was transferred to an Aboriginal Land Council pursuant to a claim under the ALR Act, the lease of the premises or the relevant part terminated on the date of transfer.

15. [15]

    On 10 December 2021, the Minister for Planning and Public Spaces (being the Minister Administering the Crown Lands Act) determined claims made in respect of particular parcels of land located at Paddington in areas known as Trumper Park. Relevantly to these proceedings, the Minister partly granted and partly refused Aboriginal Land Claim 42494 (being part of the bulk claim). The part granted was in respect of the site known as the Paddington Bowling Club.

16. [16]

    The Minister was provided with a briefing paper headed “Determination of Aboriginal Land Claims 20657, 29716 and part of 42494”. The briefing paper recommended that the Minister in part grant and in part refuse the Aboriginal Land Claim 42494 and sign and date letters addressed to the La Perouse Local Aboriginal Land Council and the NSW Aboriginal Land Council advising of the decision. Those letters relevantly stated that:

17. [17]

    The briefing paper contained an attachment (attachment “B”) said to contain an analysis of the facts relevant to the claimed land against the criteria contained within s 36 of the ALR Act. The briefing paper included other information including submissions by the solicitors for the appellant as to why the site was not claimable Crown land.

18. [18]

    Attachment B to the briefing paper included the following:

19. [19]

    This summary did not address a submission advanced by the solicitor for the appellant on 4 August 2020, which was included in the attachments provided to the Minister. The submission was that at the date of the claim the site was not claimable Crown land because it was being lawfully used by the Crown as the Crown was leasing the site to CSKS for a substantial rent. The solicitor referred to and relied on Ryde Municipal Council v Macquarie University (1978) 139 CLR 633; [1978] HCA 58 (“Macquarie University case”) and sought to distinguish Minister Administering the Crown Lands Act v New South Wales Aboriginal Land Council (2008) 237 CLR 285; [2008] HCA 48 (“Wagga Wagga case”), and New South Wales Aboriginal Land Council v Minister Administering the Crown Lands Act (2016) 260 CLR 232; [2016] HCA 50 (“Berrima Gaol case”). Those authorities are discussed below.

20. [20]

    The appellant commenced Class 4 proceedings in the Land and Environment Court seeking an order preventing the Minister from transferring the site to the La Perouse Local Aboriginal Land Council, an order in the nature of certiorari to quash the Minister’s decision and a declaration that the site was lawfully used or occupied on 19 December 2016, or alternatively an order that the matter be remitted to the Minister to determine the claim according to law.

21. [21]

    The appellant did not serve a notice on the Minister requiring him to provide a statement of reasons for the decision (Uniform Civil Procedure Rules 2005 (NSW) rr 59.1(b), 59.9).

The Legislation

1. [22]

   The long title and preamble to the ALR Act states:

2. [23]

   Section 36 relevantly provides:

3. [24]

   Section 4(1) provided that “…except in so far as the context or subject-matter otherwise indicates or requires – … land includes any estate or interest in land, whether legal or equitable”. A “land claim” was defined to mean “a claim for land made under section 36”.

4. [25]

   Section 36(1)(a) refers to the Crown Lands Consolidation Act 1913 and the Western Lands Act 1901. Those Acts had been repealed by the date of the claim. Clause 21 of Sch 8 to the Crown Lands Act 1989 (NSW) provided that a reference in any other Act to the Crown Lands Consolidation Act 1913 should be read as a reference to the Crown Lands Act 1989. The Crown Lands Act 1989 was repealed by Sch 8(a) of the Crown Land Management Act 2016, but was in force at the date of the claim (19 December 2016).

5. [26]

   Section 6 of the Crown Lands Act provided that:

6. [27]

   Section 34 of the Crown Lands Act permitted the Minister to lease or otherwise deal with Crown land, but if the Minister were to lease Crown land for a term exceeding five years, notice was first required to be published of the Minister’s intention to do so (s 34(3)). As noted above, the Minister was empowered by s 34A(1) to grant a lease over a Crown reserve for any purpose the Minister thought fit, provided the Minister was satisfied that it was in the public interest to grant the lease and had due regard to the principles of Crown land management (s 34A(1) and (2)(c)). No party submitted that the lease to CSKS was unlawful because CSKS was not required by the terms of the lease to carry out the permitted purpose of “community and sporting club facilities, tourist facilities and service access”, or for any other reason.

The judgment below

1. [28]

   The primary judge (Preston CJ of LEC) first addressed a submission made on behalf of the appellant below, but not repeated on appeal, that notwithstanding CSKS had granted a sublease or licence to the entity carrying on business under the name Wentworth Tennis Club (“WTC”) without the prior written consent of the Minister, the use of the part of the land consisting of tennis courts on the northern side of the site was lawful. The appellant below challenged the Minister’s apparent finding that WTC’s use and occupation of the tennis courts was not lawful because its sublease or licence was given by CSKS in breach of the terms of its lease from the Crown. The challenge was based on two grounds. First, the appellant relied on the terms of the Minister’s consent to the assignment of the lease from CSKS to the appellant given on 1 February 2018 in which the Minister acknowledged that CSKS was “compliant with all its leaseholder obligations on and about 19 December 2016”.

2. [29]

   Secondly, it argued that that Minister misconstrued cl 39(a) of the lease. It submitted that the evidence did not establish that CSKS had parted with possession of the tennis courts.

3. [30]

   The primary judge rejected both of those arguments. There is no appeal from that rejection.

4. [31]

   The material before the Minister indicated that WTC was in possession of the tennis courts under an oral sublease determinable at the will of either party by one month’s notice in writing (Conveyancing Act 1919 (NSW) ss 23D(2) and 127(1)).

5. [32]

   WTC was not a party to the proceedings below. Prior to the hearing of the appeal the Court directed that it be given notice of the proceedings. WTC advised the Court that it did not wish to be joined as a party to the appeal, did not wish to be heard, and submitted to any orders the Court might make. No party suggested that WTC ought to be joined as a party to the proceeding. It had expressly opposed the making of any such order.

6. [33]

   The submissions below did not raise any question as to whether the use of the tennis courts by WTC was lawful, or that the use of the tennis courts by members of the public who hired the courts was lawful, notwithstanding that the parol sublease by CSKS to WTC was made in breach of its lease. That issue was raised for consideration of the parties by the Court prior to the hearing of the appeal (when the attitude of WTC was not known). The appellant did not seek to amend its grounds of appeal to address the issue.

7. [34]

   The first respondent (the Minister) and the second and third respondents (the La Perouse Local Aboriginal Land Council and the NSW Aboriginal Land Council) indicated that if the issue were raised they would rely upon s 6 of the Crown Lands Act 1989 which, as indicated at [26] above, relevantly provided that Crown land shall not be used, leased, licensed, or otherwise dealt with, unless the use, lease, license or other dealing is authorised by that Act.

8. [35]

   Because this was not an issue raised on the appeal, it need not be addressed.

9. [36]

   Two other issues were raised before the primary judge. The first was the submission referred to at [19] that the Crown itself was lawfully using the relevant claimed land for the purpose of leasing the land to CSKS and later to the appellant. The appellant submitted that if the Minister considered this argument and rejected it then he erred in law and, if he failed to consider the argument, then he denied the appellant procedural fairness by not addressing a substantial and clearly articulated argument (at J [9]).

10. [37]

    The primary judge found that it should be inferred that the Minister did consider the submission that was included in the materials provided to the Minister, and that there was no denial of procedural fairness (at J [46], [56]-[60]).

11. [38]

    In relation to the merits of the submission, the primary judge found:

12. [39]

    There is no appeal from the primary judge’s finding that the Minister did consider the appellant’s submission referred to at [19] above. The grounds of appeal are:

13. [40]

    Ground 1 depended upon the establishment of either Ground 2(a) or (b). The appellant relied principally on ground 2(b).

Ground 2(b)

1. [41]

   In the Wagga Wagga case, the plurality left open the question of whether, in s 36(1)(b), the words “are not lawfully used or occupied” was a composite expression having a single meaning or was better understood by giving the words “used” and “occupied” separate consideration (at [73]).

2. [42]

   That question was resolved by the High Court’s decision in the Berrima Gaol case, where the land claim failed because the land was lawfully occupied by Corrective Services NSW (which was part of the Department of Justice) even though it was not being lawfully used at the date of the claim (see especially [14] per French CJ, Kiefel, Bell and Keane JJ, and [88]-[90] per Gageler J).

3. [43]

   At common law, the Crown was notionally the occupier of all of the land the Crown owned. It has always been accepted that this notional occupation is not sufficient to engage the exception in s 36(1)(b). Were it otherwise, the Act would be a dead letter. A determination of whether land is occupied requires consideration of what is actually (that is, physically) done on the land to determine whether there is “actual” possession with a sufficient degree of permanence or continuity (Wagga Wagga at [69]). That is because “occupied” in its ordinary sense means physical occupation. In contrast, where the question to be determined is whether the land was lawfully used, “use” or “used” does not in itself necessarily denote or connote a physical use. Those words have a protean meaning. It is an ordinary meaning of “use” or “used” that where land is leased it is used by the tenant by the tenant’s conducting physical activities on the land, and also used by the landlord by deriving rent from it (Commissioner of Income Tax v Hanover Agencies Ltd [1967] 1 AC 681 at 689; Macquarie University case (discussed below); Tourapark Pty Ltd v Federal Commissioner of Taxation (1982) 149 CLR 176 at 181; [1982] HCA 18). Such uses will usually be concurrent.

4. [44]

   As Mahoney JA said in Macquarie University v Ryde Municipal Council [1977] 1 NSWLR 304 at 313-314:

5. [45]

   In considering whether a lawful use of land for the purposes of s 36(1)(b) of the ALR Act can include the use of land by the Crown in leasing it, or whether the term is limited to physical use, the following features of the provision may be noted.

6. [46]

   First, having regard to the definition of land in s 4, unless the context or subject matter otherwise requires, the claimable Crown lands whose lawful use is to be considered includes any estate or interest in the land. The definition of “land” in s 4 applies to the “lands” referred to in s 36(1) (unless the context or subject matter indicates otherwise) notwithstanding that s 36 refers to lands in the plural whereas the definition refers to land in the singular. Quite apart from s 8(b) and (c) of the Interpretation Act 1987 (NSW), it is clear from the definition of “land claim” and the use of “land” in the singular in s 36(2) and (3) that a claim for land (in the singular) falls within s 36, thus invoking the definition of “land”. There can be concurrent interests, any of which, individually or cumulatively, may be considered.

7. [47]

   Secondly, unlike similar provisions in some rating statutes, s 36(1)(b) does not identify any particular user or type of user. There is no implication that the land claimed or part of the land claimed cannot be used by more than one person for different purposes. If the definition of “land” is applicable, the contrary must be the case. Section 36(1)(b) does not specify which user, if there are multiple users, is to be considered for the purposes of the exception. It does not imply that there can be only one relevant user.

8. [48]

   That is, there is no specification of any particular type of use which, if lawful, will mean that the land is not claimable Crown land. That is to say, prima facie, any lawful use at the date of the claim will mean that the land is not claimable.

9. [49]

   Prima facie, where claimed land is subject to a lease from the Crown, both the use by the tenant of the physical land, and the use by the Crown of its reversionary interest must be considered.

10. [50]

    Subject to contrary legislative indications, unless constrained by authority, I would accept the appellant’s submission that, given the protean character of the word “used” and the definition of “land” in s 4, s 36(1)(b) requires consideration of whether any interest in land by any holder of that interest is “used”.

11. [51]

    The point was made by Adamson JA in an exchange with Mr Wright SC, who appeared with Mr Jones for the La Perouse Local Aboriginal Land Council and the NSW Aboriginal Land Council:

12. [52]

    Counsel’s response was:

13. [53]

    That answer did not address the thrust of the question.

14. [54]

    The respondents submitted that there were contrary legislative indications. They relied on cl 8 of Sch 4 to the ALR Act. Schedule 4 is headed “Savings, transitional and other provisions”. Clause 8 provides:

15. [55]

    The respondents submitted that, on the appellant’s construction, cl 8 would have been unnecessary. That is, on the appellant’s construction, land leased by the Crown would not be claimable under s 36 because it could always be said that the Crown was using the land. It would be unnecessary to make special provision preserving existing leased land from potential claims. The respondents submitted that the necessary implication from the transitional provision that preserved from claims land that was the subject of a lease, licence or permissive occupancy on the commencement of the Act, was that Parliament intended that, except for existing leases, licences or permissive occupancies, land could be claimable Crown land notwithstanding that the land was subject to such a lease, licence or permissive occupancy.

16. [56]

    Clause 8 deals with land the subject of a lease, licence or permissive occupancy. Even though, in one sense, it can be said that the Crown will use land if it leases the land to derive income or to fulfil a public purpose, it does not follow that it can equally be said that the Crown would use land by granting a gratuitous licence or a permissive occupancy. The appellant submits that the inclusion of leases in cl 8 was for abundant caution.

17. [57]

    At least in its application to Crown leases, I accept the appellant’s submission that the provision was included for abundant caution. Its protection of the holders of existing rights is consistent with the appellant’s construction.

18. [58]

    Both the appellant and the respondents raised the spectre of the legislation being abused if their respective contentions were not adopted.

19. [59]

    For the respondents, it was submitted that the Minister could avoid claims by Aboriginal Land Councils by entering into a “paper lease” where the Crown had ceased its use of lands but had not made a decision as to whether to sell lands that were surplus to the Crown’s requirements. The appellant submitted that an Aboriginal Land Council could procure a lessee from the Crown not to use all or part of the lands leased so as to make a claim for land not physically used.

20. [60]

    Parliament would not have contemplated that either the Minister or an Aboriginal Land Council would abuse his, her, or its position either, in the case of the Minister, to defeat a land claim that was properly available or, in the case of an Aboriginal Land Council, to procure a transfer of land to which it was not entitled. These are “extreme examples and distorting possibilities” that are not useful guides for construction (Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28; [2003] HCA 72 at 43, [32]; and Mondelez Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers’ Union (AMWU) & Ors (2020) 271 CLR 495; [2020] HCA 29 at 527, [86]).

21. [61]

    A further issue was raised concerning what is sometimes called the principle of legality, that is, that except if clear words are used, Parliament is not to be taken to have intended to override established rights, including rights to property. The Minister submitted that the lease assigned to the appellant would be terminated on the transfer of the land to the La Perouse Aboriginal Land Council, but only by reason of cl 10 of the deed by which the Minister consented to the transfer of the lease from CSKS to the appellant (see [14] above).

22. [62]

    The Land Councils contended that that would be the effect of the Act, irrespective of the terms of the deed of consent. If that were so, it would favour the appellant’s construction of “use”.

23. [63]

    However, the Land Councils’ position finds no support in the legislation or the authorities. Section 36(9) relevantly provides that any transfer of lands to an Aboriginal Land Council is to be for an estate in fee simple (subject to any native title rights and interests existing in relation to the lands immediately before the transfer). Section 36(12) provides that a transfer of lands pursuant to s 36 is subject to any easements affecting the lands, any condition imposed by the Minister under s 36(5A), any forestry right within the meaning of s 87A of the Conveyancing Act 1919 (NSW), or any restriction on use, or covenant imposed, under Div 4 of Pt 6 of that Act in connection with a forestry right in force immediately before the transfer.

24. [64]

    The qualifications in s 36(9) and (12) to the transfer of an estate in fee simple preserve rights which derogate from the absolute ownership denoted by an estate in fee simple. The grant of a leasehold estate does not do so. As Professor Edgeworth explains, a leasehold is essentially land held “of” another in the same way that a freehold estate was held in feudal times (Butt’s Land Law, 7 ed, Law Book Co 2017, pars 3.480-3.540).

25. [65]

    At the date of the claim, the Crown held an estate in fee simple notwithstanding the grant of the lease to CSKS. The mere transfer of the estate in fee simple to an Aboriginal Land Council should not affect the leasehold estate. It would also be strange if a leasehold estate to which the lessee has an indefeasible title by virtue of s 42 of the Real Property Act could be avoided by mere implication said to arise under s 36 of the ALR Act.

26. [66]

    In Minister Administering the Crown Lands Act v NSW Aboriginal Land Council (1993) 31 NSWLR 106 (“the Nowra Brickworks case (No 1)”), Sheller JA, with whom Priestley and Clarke JJA agreed, said (at 115):

27. [67]

    In Mogo Local Aboriginal Land Council v Eurobodalla Shire Council (2002) 54 NSWLR 15; [2002] NSWCA 12 at [57], Giles JA, with whom Hodgson JA and Rolfe AJA agreed, said of s 36 of the ALR Act:

28. [68]

    Prima facie, assuming this to be correct, a construction of s 36(1)(b) which confines the relevant “use” to a physical use of land by the lessee would not impair the lessee’s rights unless there were an express term in the lease or other dealing, such as cl 10 of the deed of consent in this case, which brought the lease to an end or required its surrender. The lessee’s estate would not be extinguished. The lessee would hold its estate, not from the Crown, but from the Aboriginal Land Council to whom the fee simple was transferred.

29. [69]

    Of course, on the wider construction of “use” for which the appellant contends the question would not arise because the land would be “used” by the Crown by leasing it.

30. [70]

    This means neither construction of “lawfully used” in s 36(1)(b) would raise the so-called principle of legality, that would prefer a construction that did not avoid existing rights.

31. [71]

    Nonetheless, as the appellant submitted, a construction that has regard to potential consequences must take account of how the Act would apply if only part of land leased by a tenant from the Crown were claimable Crown land. Section 23F of the Conveyancing Act provides that the Registrar-General may refuse a transfer of part of an existing lot. That section does not apply where the transaction transfers land to an Aboriginal Land Council in accordance with the requirements of the ALR Act (s 23G(k)). Neither the ALR Act nor the Conveyancing Act provides any methodology or procedure for the apportionment of rent or outgoings between two landlords if part of land leased is claimable.

32. [72]

    Unless s 36(1)(b) is to be read narrowly to give the ALR Act a beneficial and remedial effect, having regard to the text of s 36 and the definition of “land”, I would accept that the Crown’s use of the land in deriving rent by leasing the land to CSKS for the purpose of making the land available for the purposes specified in the reservation was a lawful use of the land by the Crown, which meant that the land was not claimable Crown land. That conclusion is buttressed by the practical difficulties referred to at [71] of a different construction.

33. [73]

    But there is a serious question whether that construction is open. The judgments on s 36(1)(b) have overwhelmingly (but not wholly) focussed on whether there has been a substantial and not a transitory or insignificant physical use of the land claimed to determine whether it was claimable. As will be seen, none of the authorities on s 36 of the ALR Act to which we were referred has addressed the present question. None has addressed a claim to land leased by the Crown. None has addressed the significance of the definition of “land” in s 4.

34. [74]

    The question whether a landlord’s leasing of premises is a “use” of the premises by the landlord has arisen in other contexts, particularly rating statutes and statutes imposing land tax.

35. [75]

    Commissioners of Taxation v Trustees of St Mark’s Glebe [1902] AC 416 concerned s 11(5) of the Land and Income Tax Assessment Act 1895 (NSW). That section exempted land from land tax where the lands were “occupied or used exclusively for or in connection with…public charitable purposes, churches,…”. Forty acres of land at Randwick had been vested by Crown grant in trustees for the Church of England for the benefit of St Mark’s Darling Point. Some of the land had been let on building leases on which the lessees had erected private dwellings and were paying rent to the trustees. The rent was applied by the trustees for the trusts on which the land was held, being for public charitable purposes or a church.

36. [76]

    The Privy Council held that, although literally the lands were “used in connection with” the charitable purposes of the Crown grant, reading the whole of s 11(5), the words pointed

37. [77]

    Section 11(5) also exempted lands occupied, or used exclusively for, or in connection with, public hospitals, universities and affiliated colleges, and additionally specifically exempted any lands the property of, or vested in, any council or municipality, public hospital, university, or affiliated college. There was no similar exemption for land the property of or vested in churches or charitable trustees generally (at 419-421). This showed a Parliamentary intention not to include within the exempted class of lands, any lands vested in or held as an endowment only of churches, grammar schools and the like (at 421). It demonstrated that the exemption for lands used for or in connection with public charitable purposes or churches referred only to lands physically used for those purposes or by those bodies.

38. [78]

    In the Macquarie University case, Gibbs ACJ said that in Commissioners of Taxation v Trustees of St Mark’s Glebe, the Privy Council was not called on to decide whether the land was used or occupied by the trustees, but the question was for what purposes they were used (at 641). I would rather say that the taxing provision showed that, in the cases of the trustees of public charitable trusts and churches, the taxing provision itself demonstrated that the use referred to which carried the exemption in the case of those bodies (in contrast to public hospitals, universities and affiliated colleges) was confined to the lands occupied or physically used. It was the context that required this construction. Without that context, the words were capable of a construction that the lands let by the trustees of the church to derive income for the purposes of the church could be said to have been used in connection with the charitable purpose of the Crown grant.

39. [79]

    In Stephen v Federal Commissioner of Land Tax (1930) 45 CLR 122; [1930] HCA 46, land was exempt from land tax if it were “used or occupied…solely as a site for…a…public recreation ground”. In Council of the Municipality of Randwick v Rutledge (1959) 102 CLR 54; [1959] HCA 63, land was exempted from rates by s 132(1)(c) of the Local Government Act 1919 (NSW) if it had been dedicated or reserved from sale by the Crown for public health, recreation, enjoyment or other public purposes of a like nature and was used for one of those purposes. In the context of these provisions, Dixon J (in Stephen v Federal Commissioner of Land Tax) and Windeyer J (in Council of the Municipality of Randwick v Rutledge) referred to an “actual” use of land, using that expression synonymously with a physical use of land. In each case the stipulation of the purpose of the use required that construction.

40. [80]

    In the Macquarie University case the question was whether a market on the grounds of the Macquarie University that consisted of retail shops, a travel centre and a bank, let to tenants, was exempt from rates on the basis that the land (which was vested in the Macquarie University) was “…used or occupied by the University…solely for the purposes thereof”. The High Court (Gibbs ACJ and Stephen J (Murphy J agreeing with Stephen J); Aickin and Jacobs JJ dissenting) held that the word “solely” did not refer to the University but to the purpose for which the University used the land. The University did not occupy the land. The land was occupied by the tenants. There were three questions: was the land used by the University; if so was the use for the purposes of the University; and if so was it was solely for those purposes? Gibbs ACJ said (at 638):

41. [81]

    Stephen J said (at 651) that “…it is a truism that ‘use’ is not a word having any single, precise meaning. It is a ‘word of wide import and its meaning in any particular case will depend to a great extent upon the context in which it is employed’ per Taylor J in Newcastle City Council v Royal Newcastle Hospital (1957) 96 CLR 493 at 515”. Stephen J considered that the advantage which the University intended to derive from the market, that is, providing shopping and banking facilities for students and staff, was a use of the land within the meaning of provision.

42. [82]

    Gibbs ACJ referred to authorities where an exemption from rates or taxes was given in respect of land use for the purposes of a charity. The exemption was not lost if the land were used also for other purposes provided the other purposes were merely a means to the fulfilment of the charitable purpose and incidental thereto. But the exemption was lost if the other purposes ceased to be a means to an end and became collateral and additional purposes (Salvation Army (Victoria) Property Trust v Fern Tree Gully Corporation (1952) 85 CLR 159 at 169; [1952] HCA 4). Gibbs ACJ considered that if the market had been let to tenants solely to raise money for the University then, even where his Honour (with the concurrence of Stephen and Murphy JJ) concluded that leasing the land was a “use” for the purposes of the provision, it could not be said that the land was “for the purposes of the University”. But the market was erected and the buildings were let not just to raise money, but to provide facilities considered necessary or desirable for the functioning of a University in modern conditions (at 644).

43. [83]

    No such issue arises under s 36(1)(b) where there is no requirement that the lawful use be for a particular purpose, let alone for a sole or exclusive purpose. The appellant also submitted that, in any event, the Crown’s purpose in leasing the land was not merely to gain income, but to serve the purpose for which the land had been reserved and to serve the public interest.

44. [84]

    Turning to appellate authority on the meaning of “used” in s 36(1)(b) of the ALR Act, in Daruk Local Aboriginal Land Council v Minister Administering the Crown Lands Act (1993) 30 NSWLR 140, the land claimed was held by the Hawkesbury City Council as trustee under the Crown Lands Act under a reservation for public recreation. It was sporadically visited by members of the public, but also used as a dumping ground for unwanted motor vehicles and rubbish. The Council conducted limited maintenance.

45. [85]

    Priestley JA, with whom Cripps JA agreed, considered that the land was not occupied by the Council. He said that occupation required actual occupation in the sense of occupation in fact and to more than a notional degree (at 162). On the question as to whether the land was “used”, his Honour said (at 164):

46. [86]

    It is apparent that when Priestley JA referred to the land being “‘actually used’ in the sense of being used in fact” his Honour was referring to physical use of the land. I infer that the reference to “…more than a merely notional degree” is to a physical use that was more than merely transitory or insignificant.

47. [87]

    Mahoney JA dissented. His Honour said (at 141-142):

48. [88]

    His Honour doubted that where land is set aside as a reserve for public recreation it necessarily would require proof of some physical use or activity constituting “actual user” for that purpose (at 143).

49. [89]

    In Nowra Brickworks No.1 and Minister Administering the Crown Lands Act v New South Wales Aboriginal Land Council (No. 2) (1997) 42 NSWLR 641 (“Nowra Brickworks No. 2”) the land claimed was subject to a mining lease. The Minister argued that the land claimed was not claimable Crown lands because it was land lawfully used or occupied by the holder of the mining lease and because cl 8 of Sch 4 to the ALR Act postponed the status or quality of the land being claimable Crown lands until the mining lease ceased to be in force (Nowra Brickworks case (No 1) at 109).

50. [90]

    No party contended that the Minister was using the land by granting the mineral lease. This may have reflected an assumption that the only relevant use to be considered was the physical use of the land the subject of the claim. Because the matter proceeded by way of assumption rather than decision, the Nowra Brickworks cases are not authority against the appellant’s submission (CSR Ltd v Eddy (2005) 226 CLR 1, 11 (at [13]); [2005] HCA 64)

51. [91]

    In the Wagga Wagga case the land the subject of the claim had been used as a motor registry until approximately 1985. Between 1985 and approximately 1998 it was used for storage. In 1999, the Regional Office of the Department of Lands advised that it was surplus to its requirements. A report in December 2004 stated that the building had been vacant for a number of years and had fallen into disrepair. The minimal storage of furniture was an insubstantial user. Steps were taken from towards the end of 2004 to arrange for the site to be sold by auction. For the most part, all of those steps were taken off the land. The land claim was made on 23 May 2005. The High Court upheld the unanimous decision of this Court. The plurality of the High Court (Hayne, Heydon, Crennan and Kiefel JJ), said:

52. [92]

    This draws attention to the observation of Mahoney JA in Daruk quoted at [87], to the observation of Sheller JA (with whom Clarke JA agreed and with whom Priestley JA generally agreed) in Nowra Brickworks case (No 1) (at 120) that “…for the most part, dependent upon the purpose for which lands are claimed to be used is the degree of physical occupation or enjoyment called for to demonstrate that they are in fact so used”, and to the judgment of Giles JA in the Wagga Wagga case in this Court.

53. [93]

    In the Court of Appeal, Giles JA said in this court (New South Wales Aboriginal Land Council v The Minister Administering the Crown Lands Act [2007] NSWCA 281 (at [68])) that “…depending on the purpose for which it was claimed the land was being used, use may or may not be synonymous with physical occupation and enjoyment.”

54. [94]

    In the High Court the plurality continued:

55. [95]

    The appellant rightly emphasised this paragraph as demonstrating that the High Court’s decision in Wagga Wagga did not exhaustively define the meaning of “used” in s 36(1)(b).

56. [96]

    The plurality also said that, irrespective of whether the words “lawfully used or occupied” should be understood as a single meaning (which would seem to accord with the meaning Priestley JA adopted in Daruk), or whether the words “used” and “occupied” are to be understood as having separate meanings (as Giles JA said in this Court in the Wagga Wagga case at [65]) the expression “…encompasses utilisation, exploitation and employment of the land” (at [73]). Unfortunately for the purposes of this appeal, the words “utilisation, exploitation and employment” carry the same ambiguity as the word “use”. “Utilisation” is an Americanisation of “use”. “Exploitation” and “employment” might refer either to physical use of the land or use for other purposes.

57. [97]

    The plurality went on to say that:

58. [98]

    The respondents submitted that, whilst the plurality confined its analysis in [74] to exploitation by sale, it should follow that if exploitation by sale is not a use of the land for the purposes of s 36(1)(b), exploitation by leasing should also not be a relevant use.

59. [99]

    The appellant submitted that exploitation by sale is not to be equated with exploitation by leasing. To allow as a lawful use the exploitation of Crown land by sale that was surplus to the Crown’s requirements would be to deny a central purpose of the ALR Act, which is to make surplus lands of the Crown available for land claims. Conversely, this is not the case for leasing. There is force in this submission. In the Court of Appeal in the Wagga Wagga case, it underlay the reasoning of at least Giles JA. But it was not explicitly articulated as a reason for the finding of the plurality in the High Court at [74] that exploitation by sale did not amount to a lawful use of the land.

60. [100]

    The reasoning of the plurality at [75] and [76] quoted above suggests that the plurality considered that only the physical use of claimed land was a relevant use for the purposes of s 36(1)(b). That was the understanding of this Court in Chief Commissioner of State Revenue v Metricon Qld Pty Ltd [2017] NSWCA 11 at [17]; (2017) 224 LGERA 236. I expressed the same understanding at first instance in that case (Metricon Qld Pty Ltd v Chief Commissioner of State Revenue (No. 2) [2016] NSWSC 332 at [32]).

61. [101]

    This is in part because of the plurality’s endorsement of Fullagar J’s dissenting opinion in Newcastle City Council v Royal Newcastle Hospital (1957) 96 CLR 493 at 506; [1957] HCA 15, quoted at [75] in the plurality’s reasons. The issue in that case was whether the Royal Newcastle Hospital “used” bushland that was kept in its virgin state that surrounded a separate part of the Royal Newcastle Hospital which accommodated patients suffering tuberculosis. The clear air and peace was considered to be important for their rehabilitation. The High Court, by majority, held that the rating exemption was applicable, but there was no clear ratio for the majority’s decision. The Privy Council dismissed the appeal, essentially on the ground that the surrounding bushland (which the City of Newcastle claimed was not exempt from rating) was “used” because it was put to advantage by the hospital for its patients. This was so notwithstanding that it conducted no physical activities on the land (Council of the City of Newcastle v Royal Newcastle Hospital (1959) 100 CLR 1 at 4; [1959] AC 248 at 257).

62. [102]

    Although the plurality in Wagga Wagga endorsed the dissenting reasons of Fullagar J, they did not query the correctness of the decision in the City of Newcastle case. As I have elsewhere sought to explain (Metricon Qld Pty Ltd v Chief Commissioner of State Revenue (No. 2) at [40]-[42]), unless Fullagar J was warning against the fallacy of making assumptions, his reasoning in the passage quoted assumes his conclusion that “use” meant physical use. The plurality’s endorsement of Fullagar J’s observation suggests that the plurality adopted that conclusion as the meaning of “used” in s 36(1)(b).

63. [103]

    This reading of the plurality’s reasons is then supported by the reasoning at [76] quoted above that nothing was actually done on the land that would constitute a use of the land other than transitory and insubstantial visits by a surveyor and a real estate agent.

64. [104]

    In Wagga Wagga, Kirby J held that giving a beneficial and remedial interpretation required that the exceptions in s 36(1) be construed narrowly (at [13]-[21]). His Honour interpreted the Court of Appeal’s requirement for “actual use”, which goes beyond a use that is “merely notional”, as addressing the physical use of the land and held that this was appropriate in giving the legislation a beneficial and remedial construction (at [29]-[30]).

65. [105]

    Kirby J approved of the observations of Spigelman CJ in Minister Administering Crown Lands Act v Deerubbin Local Aboriginal Land Council (No. 2) (2001) 50 NSWLR 665 at 674, [53]-[54]; [2001] NSWCA 28 that to give the ALR Act a beneficial and remedial interpretation, it was appropriate to read the exceptions in s 36(1) narrowly.

66. [106]

    As the plurality noted in the Berrima Gaol case (at [31]), Kirby J was in the minority in Wagga Wagga in his reliance on the need for a construction that gave effect to the beneficial and remedial purposes of the Act as a whole. In the Berrima Gaol case, the plurality said that that principle had little role to play where the question arising under s 36(1) was as to the meaning of the particular words in question (at [33]). That was in the context of considering whether the site was “occupied”, or, as the minority (Nettle and Gordon JJ) considered was the relevant question (at [146]), whether s 36(1)(b) should be understood as meaning occupied pursuant to the purpose for which the land was dedicated, rather than simply as “occupied”.

67. [107]

    The respondents also rely upon the statement of the plurality in the Berrima Gaol case at [34]:

68. [108]

    To say that “used” (as well as “occupied”) requires an examination of activities undertaken upon the land means that physical use or the lack thereof is always relevant. It does not mean that physical use is necessarily the only relevant use.

69. [109]

    As in the Wagga Wagga case, the present issue did not arise in the Berrima Gaol case. The plurality’s statement that the word “used” requires an examination of activities undertaken upon the land cannot be taken as a statement that that is the only sense in which the word “used” is used in the section.

70. [110]

    Other cases in this Court, such as Minister Administering Crown Lands Act v Bathurst Local Aboriginal Land Council [2009] NSWCA 138; (2009) 166 LGERA 379; and Minister Administering the Crown Lands Act v La Perouse Local Aboriginal Land Council [2012] NSWCA 359; (2012) 193 LGERA 276, also addressed different issues. In the Bathurst Local Aboriginal Land Council case, Basten JA noted this (at [249]) where his Honour observed that “at least in the context of a rating statute” the owner of land may confer a right of occupation on a licensee or lessee, with the result that the owner is no longer in occupation but may still be using the land for its purposes. Whether such an “indirect use” would be sufficient use for the purposes of the ALR Act did not need to be considered.

71. [111]

    In short, the authorities on s 36(1)(b) have consistently construed the word “lawfully used” as referring to physical activities on the land. In Daruk, Priestley JA considered that, in its context, the word “used” was governed by the same considerations as applied to “occupied”. That led his Honour to the conclusion that “used” meant “actually used” to more than a notional degree, which evidently referred to physical use of the land. This is to read “lawfully used or occupied” as a composite expression, but in the Berrima Gaol case it was held that that was not the correct construction. It was there held that “used” and “occupied” required separate consideration so that either a lawful use or lawful occupation would defeat a claim (at [42]) above. This is consistent with the view of Giles JA in this Court’s decision in the Wagga Wagga case (at [65]) that “…the alternatives of ‘use’ and ‘occupation’ [mean] that ‘use’ is different from, and does not require, ‘occupation’”.

72. [112]

    Whilst a beneficial and remedial construction of the Act would suggest that the ambiguity of the word “used” be resolved by restricting the meaning of that word to a physical use of the land, that approach is not open where the question is the meaning of the words used in s 36(1)(b).

73. [113]

    Unless the context or subject matter otherwise requires, the “lands” (or “land”) is to be construed as not only the physical land used, but any estate or interest in the land used. If the expression “lawfully used or occupied” were read as a composite expression, then the “lands” so used or occupied should be read as the physical lands so used or occupied. But given that the expressions “used” and “occupied” are to be considered separately, there is nothing in the text of s 36(1)(b) that requires “lands…used” to be read as confined to the physical land. In any event, for the reasons above, a landlord can be said to use his or her land by leasing it.

74. [114]

    Part 2 of the ALR Act is headed “Land Rights”. Section 36 is in Division 2 which is headed “Claimable Crown lands”.

75. [115]

    Division 3 is headed “Acquisition of other lands”. Section 38 in Division 3 provides that the New South Wales Aboriginal Land Council or a Local Aboriginal Land Council can purchase, take on lease or hold any property, or acquire property by gift inter vivos, devise or bequest. That is subject to conditions as to the circumstances in which a Local Aboriginal Land Council can purchase land, which are not presently relevant.

76. [116]

    Division 4 is headed “Land dealings by Aboriginal Land Councils”. It governs land dealings by an Aboriginal Land Council. A “land dealing” is defined to mean an action in relation to land of a kind referred to in the definition of “deal with land”. The definition of “deal with land” elaborately describes different modes of dealing with land including selling, exchanging, leasing, mortgaging, disposing of, or otherwise creating or passing a legal or equitable interest in land (para (a)). The note to the definition of “deal with land” (which is itself part of the Act) states: “In this Act, a reference to land includes any estate or interest in land, whether legal or equitable (see section 4(1)) (emphasis added).”

77. [117]

    The note confirms that the definition of “land” is not confined to Divisions 3 and 4. This indicates that the definition of “land” is applicable to each of the Divisions of Pt 2.

78. [118]

    If “lawfully used or occupied” were a composite expression indicating actual physical occupation and physical use of land, then s 36(1)(b) would indicate that, in that provision, “lands” did not have its defined meaning. But given that it has been held in the Berrima Gaol case that “use” and “occupation” are separate concepts, there is no reason not to apply the definition of “land” in s 4 where the issue is the use, rather than the occupation, of land.

79. [119]

    For these reasons, the better construction is that the Minister used the interest held by the Crown in the land by leasing it to CSKS. The fact that CSKS did not physically use the land does not mean that the Minister did not use it by leasing it to CSKS for the purpose stated in the lease.

80. [120]

    This construction is consistent with s 36(5). The chapeau to that provision identifies two classes of lands which may be the subject of a successful claim. One class is lands vested in her Majesty (s 36(1)) which are able to be sold or leased under a provision of an Act administered by the Minister. The other is lands vested in her Majesty that would be able to be sold or leased under such a provision but for any restriction on their sale or lease. It is the ability of lands to be sold or leased that is the gateway to s 36(5). There is no implication from s 36(5) that lands that are lawfully leased by the Crown are claimable, or which requires s 36(1)(b) in its application to leased lands to be read as confined to physical use of the lands by the lessee, or persons licensed by the lessee.

81. [121]

    The primary judge found that the Minister might not have accepted the appellant’s submission that the Crown, by leasing the land to CSKS in exchange for rent, was using the land for the purpose of leasing it simply as a matter of fact (at [43], [49]).

82. [122]

    But there was no dispute about the facts. There was no issue that the Minister had entered into the lease with CSKS on the terms for which it provided. If that were a relevant use of the land for the purposes of s 36(1)(b), the Minister’s decision to the contrary was both an error of law and legally unreasonable. It is unnecessary to decide whether the Minister’s decision is reviewable only for jurisdictional error or also reviewable for error of law on the face of the record. Nor is it necessary to consider what was the record.

83. [123]

    For these reasons I would uphold ground 1 of the Notice of Appeal to the extent that it is supported by ground 2(b).

Ground 2(a)

1. [124]

   Ground 2(a) can be dealt with briefly. As I understood the appellant’s submission, it was that the land was not claimable because it was not able to be lawfully sold or leased (s 36(5)). This was because, at the date of the claim, the required steps to sell the land had not been taken and the land had already been leased to CSKS.

2. [125]

   The submission raises potentially difficult issues concerning the construction of s 36(5) in the light of s 36(1). Under s 36(1) land is claimable not only if it is able to be lawfully sold or leased, but also if it is reserved or dedicated for any purpose under the specified statutes. Section 36(5) makes no reference to the dedication or reservation of land.

3. [126]

   At the date of the claim the land was leased and was able to be leased. The appellant’s contention was that the land had to be able to be leased again. But s 36(1)(a) and s 36(5) refer to the ability of land to be sold or leased, not to the fact of whether they are the subject of a contract for sale or lease.

4. [127]

   Secondly, the fact that the land had been leased does not mean that it was not able to be leased again. To so hold would ignore the doctrine of concurrent leases.

5. [128]

   It is unnecessary to consider whether the land was able to be sold, except to reject the appellant’s submission that s 36(1)(a) and s 36(5) required that the land be susceptible both to being sold or to being leased at the Crown’s election. That distorts the disjunctive use of “or” within these provisions.

6. [129]

   I would not uphold ground 2(a).

Conclusion

1. [130]

   For these reasons, I would uphold ground 2(b) of the Notice of Appeal. I propose the following orders:

   1. (1)

      Appeal allowed.

   2. (2)

      Set aside the orders of the Land and Environment Court made on 9 June 2023 and in their place make the following orders:

   3. (3)

      Order that the respondents pay the appellant’s costs of the proceedings below and of the appeal.

2. [131]

   ADAMSON JA: I agree with White JA.

3. [132]

   STERN JA: I agree with White JA.