The Owners – Strata Plan 85044 v Murrell; Murrell v The Owners – Strata Plan 85044

Professor George Murrell and Professor Deirdre Murrell are the owners of land known as 97 Wentworth Road, Vaucluse. They are presently undertaking certain work on that land, including extensive alterations to the residence. Throughout the hearing, their senior counsel has referred to them as the Murrells. The same terminology is adopted in these reasons, without intending any disrespect. References to Professor Murrell in these reasons are references to Professor George Murrell, who gave evidence at the hearing of these proceedings. (Professor Deirdre Murrell did not give evidence.)

The Owners – Strata Plan No 85044 is a body corporate constituted pursuant to s 8 of the Strata Schemes Management Act 2015 (NSW) by the owners of the lots in the strata scheme to which registered Strata Plan No 85044 relates (the Owners Corporation). The Owners Corporation is the registered proprietor of the common property of SP 85044 which comprises land known as 95 Wentworth Road, Vaucluse and also airspace above part of the adjoining property at 97 Wentworth Road (the Airspace). [1]

The building on 95 Wentworth Road comprises four units, each of which occupies an entire level of the building. The building on 97 Wentworth Road is a residence that, as mentioned above, is presently undergoing redevelopment.

The apartments in the building on 95 Wentworth Road are oriented to the north and overlook 97 Wentworth Road, including a flat (but slightly sloping) concrete roof on part of the residence on 97 Wentworth Road. The concrete roof is being retained in the redevelopment. It is common ground that the concrete roof is between 11 and 16 centimetres below the lower horizontal boundary of the Airspace that is owned by the Owners Corporation.

The juxtaposition of 95 and 97 Wentworth Road, and the location of the flat concrete roof of 97 Wentworth Road, is shown in a photograph that was in evidence, a copy of which is reproduced in Annexure “A” to these reasons. [2] As can be seen from that photograph, each of the four apartments at 95 Wentworth Road has two terraces, one of which overlooks the flat concrete roof of 97 Wentworth Road. As can be seen from another photograph that was in evidence and that is reproduced in Annexure “B” to these reasons, the view from those terraces looking beyond the flat concrete roof is a view of Sydney Harbour. [3] The photograph in Annexure “B” also illustrates the close proximity of the flat concrete roof of the residence on 97 Wentworth Road to part of the terrace of Unit 2 at 95 Wentworth Road, from which the photograph was taken.

The dwelling on 97 Wentworth Road, including the flat concrete roof, has existed in its present form since at least about 1960. [4] In 1992, a restriction was created that prevented any improvements or other matter or thing on part of 97 Wentworth Road exceeding the height of RL 26.00 AHD. That part of 97 Wentworth Road above RL 26.00 AHD is the Airspace that became the property of the owner of 95 Wentworth Road in 1997. The apartment building at 95 Wentworth Road was constructed more recently, and the strata plan for the building was registered in March 2011.

A dispute has arisen between the Murrells and the Owners Corporation in the context of the redevelopment of 97 Wentworth Road. The dispute concerns:

By summons filed on 28 June 2019, the Owners Corporation commenced proceeding 2019/201673 against the Murrells claiming damages (including aggravated and exemplary damages) and injunctive relief in relation to alleged trespass and nuisance. It is convenient to refer to this proceeding as the Owners Corporation proceeding.

By summons filed on 25 September 2019, the Murrells commenced proceeding 2019/299582 against the Owners Corporation claiming declaratory relief concerning the proper construction of the Restriction, an order under s 89 of the Conveyancing Act 1919 (NSW) modifying the Restriction or an easement under s 88K of the Conveyancing Act. It is convenient to refer to this proceeding as the Murrell proceeding.

The two proceedings were heard together, with evidence in one being evidence in the other.

The following matters are not in dispute, save for two matters which are identified below.

The Murrells purchased their property at 97 Wentworth Road in November 2018. [5]

The Murrells’ land at 97 Wentworth Road is now contained in folio 1/1254483 of the Register. However, at the time that the Murrells purchased the property and at the time that these proceedings were commenced, this land was known as Lot 21 in DP 871094. [6] These reasons refer to the property as Lot 21, consistently with the pleadings and the terminology used by the parties in submissions. The area of Lot 21 that has been limited in height to RL 26.00 AHD since September 1997 is referred to as Part Lot 21.

The boundaries of Lot 21 at ground level were first established by plan of subdivision DP 399130, which was registered on 27 September 1955. The land was then known was Lot D in DP 399130. [7]

On 10 June 1992, the registration of DP 645772 created a covenant pursuant to s 88B of the Conveyancing Act burdening part of Lot D in DP 399130 and benefitting Lot E in DP 399130 and Lot 2 in DP 323528 on the other hand (the Restriction). The terms of the Restriction set out in the s 88B instrument are: [8]

The Restriction applied to that part of what is now Lot 21 that is marked “B” on Lot D in DP 399130, as shown in DP 645772. Within the area marked “B” on that plan is a symbol with the following notation:

The other part of the land affected by the Restriction – shown on DP 645772 as Lot E in DP 399130 and Lot 2 in DP 323528 – is part of the land at 95 Wentworth Road that is now owned by the Owners Corporation.

On 11 September 1997, plan of subdivision DP 871094 was registered. This plan subdivided the land marked “B” on Lot D in DP 399130 (that is, the part of 97 Wentworth Road affected by the Restriction) into “Part Lot 21” and “Part Lot 22” in DP 871094. Part Lot 22 is the Airspace that I have described in [2] above.

Within the area of DP 871094 that is marked “Pt 21 & Pt 22”, are the following four markings: [9]

At the time that DP 871094 was registered, 97 Wentworth Road (which become Lot 21 on the registration of the plan) was owned by Mr Harry Michael and Ms Liliane Michael, and 95 Wentworth Road (which became Lot 22, including the Airspace, on registration of the plan) was owned by Stromness Pty Limited. [10] As a consequence of the registration of DP 871094, Mr and Mrs Michael’s ownership of the land to which the Restriction applied was limited in height to RL 26.0 AHD and Stromness Pty Ltd became the registered proprietor of that land above the height of RL 26.0 AHD. It is therefore convenient to refer to DP 871094 as the Airspace plan of subdivision.

A survey plan of Lot 21 commissioned by the Murrells and prepared on 26 November 2018 states that the roof of the house on Lot 21 is partly tile and partly flat concrete, and that the height of the flat concrete part of the roof is between 25.84 and 25.89 metres AHD [11] – that is, between 11 and 16 centimetres below the horizontal boundary created by the registration of the Airspace plan of subdivision. It is clear from comparing this survey plan with DP 645772 and the Airspace plan of subdivision that the Restriction applied to part of Lot 21 that included, but was not limited to, the part of 97 Wentworth Road on which the flat concrete roof was constructed.

Although the statement of claim in the Murrell proceedings pleaded that the Airspace plan of subdivision “purported to effect a stratum subdivision … at the level plan at RL 26 AHD”, it was not in dispute that the registration of the plan was in fact effective to create that subdivision with the result that the Airspace became part of the title of Lot 22 in DP 871094. [12]

As I have mentioned above, the Restriction is recorded in notation “B” on the Airspace plan of subdivision. It is not in dispute that the subdivision created by registration of the plan was expressly subject to the Restriction. The Owners Corporation contends, and the Murrells dispute, that the Restriction became otiose on the registration of DP 871094. [13]

On 8 March 2011, plan of subdivision SP 85044 was registered. This had the effect of subdividing Lot 22 in DP 871094 into four strata lots and the common property. It is clear from Note 1 on SP 85044 that the common property includes the Airspace, with the depth limitation created by DP 871094. [14] The Owners Corporation submitted, and the Murrells disputed, that the Restriction “fell away” or “fell off” the Register upon the registration of SP 85044.

As referred to above, the Owners Corporation is the registered proprietor of the common property in SP 85044. [15]

The strata plan contains four lots: [16]

It is convenient to refer to the registered proprietors of the lots as the Unit Owners.

Whether or not the Restriction “fell away” on the registration of SP 85044, the practical effect of the above history of dealings concerning the land known as 95 Wentworth Road and 97 Wentworth Road is that any person standing on the flat concrete roof of the residence on 97 Wentworth Road now owned by the Murrells, and any thing of more than 11cm to 16cm in height that is placed on that flat concrete roof, intrudes into the Airspace owned by the Owners Corporation.

By summons filed on 28 June 2019, the Owners Corporation commenced proceeding 2019/201673 against the Murrells.

Because this proceeding was commenced in the Common Law Division of the Court, the parties have referred to it in their written and oral submissions as the “common law proceeding”. These reasons refer to this proceeding as the Owners Corporation proceeding.

In their amended statement of claim filed on 22 August 2019, the Owners Corporation claim:

The Owners Corporation alleges that the Murrells trespassed on the Strata Plan common property, and created a substantial and unreasonable interference with the property rights of the Owners Corporation in relation to 95 Wentworth Road, by:

The Murrells admit that their contractor erected the stud wall, but they do not admit it was erected on the Owners Corporation’s side of the boundary. They contend that the stud wall was constructed on the common Boundary Wall, and that this was done because the common Boundary Wall was in disrepair. They do not admit that the stud wall covered a ventilation void. In addition, the Murrells say that the Owners Corporation’s delegate consented to or authorised the erection of the stud wall.

The Murrells deny entering the Strata Plan common property to paint the existing Boundary Wall. They say that their contractor painted the surface of that wall that is on the Murrells’ side of the boundary on or about 1 December 2018. They deny needing permission from the Owners Corporation to do so.

The Murrells admit that their contractors engaged in works to the roof of the residence on Lot 21 between about November 2018 and July 2019. They say that the work was urgent remedial work that was undertaken to repair water damage to the roof of the residence, including cracks in the concrete surface of the roof and water penetration.

The Murrells say that they have informed the Owners Corporation about the nature and circumstances of the work on the roof, and that their entry into the Airspace for the purpose of carrying out that work does not breach the Restriction, does not constitute trespass or a substantial and unreasonable interference with property rights (or, alternatively, that any trespass or nuisance is so temporary and minor that the Court should not grant any relief).

For the reasons in [28] above, there can be no dispute that, by entering onto the flat concrete roof of the residence on Lot 21, and permitting or causing their contractors to do so, during the period from November 2018 to July 2019, the Murrells entered into the Airspace.

However, the Murrells contend that this did not constitute a trespass on property of the Owners Corporation or a substantial and unreasonable interference with the property rights of the Owners Corporation because:

The Owners Corporation admits that the subdivision of the Airspace from the balance of Lot 21 that was effected by the registration of DP 871094 in September 1997 was expressly subject to the Restriction. However, the Owners Corporation contends that:

The Owners Corporation acknowledges that the Murrells have statutory rights to access the Strata Plan common property (including the Airspace) for the purpose of carrying out work under s 11 of the Access to Neighbouring Land Act 2000 (NSW), in addition to such rights as the Murrells have at general law under the defence of necessity to any claim in trespass. The existence of those rights form part of the basis of the Owners Corporation’s contention that no implied easement of necessity arose on registration of DP 871094.

The Murrells admit that they did not make any application under the Access to Neighbouring Land Act in respect of the erection of the stud wall, the painting of the existing Boundary Wall or the works carried out on the roof of the residence on Lot 21. They deny that it was necessary to make such an application.

The Owners Corporation claims to have suffered the following loss by reason of the alleged trespass and nuisance:

However, the Owners Corporation did not adduce any evidence of the costs referred to in (1) to (3) and (7) above. At the hearing, the Owners Corporation sought a lump sum for general damages for the alleged trespass relating to the Boundary Wall and the Airspace.

The Owners Corporation also makes a claim for aggravated and exemplary damages in respect of the alleged trespass and nuisance.

In relation to the alleged trespass or nuisance constituted by the Murrells entering into the Airspace, the Owners Corporation seeks an order restraining the Murrells from entering into or remaining in, or causing or allowing anything to enter or remain in, the Airspace (save for the purpose of any works of an emergency nature to the dwelling on 97 Wentworth Road), until such time as a land access order is made in favour of the Murrells under the Access to Neighbouring Land Act.

In relation to the alleged trespass or nuisance constituted by the Murrells painting the Boundary Wall and the construction of the stud wall, the Owners Corporation seeks orders requiring the Murrells to restore the Boundary Wall paintwork to its former colour and condition and to remove the stud wall.

By summons filed on 25 September 2019, the Murrells commenced proceeding 2019/299582 against the Owners Corporation.

The parties frequently referred to this proceeding as “the equity proceeding”. In these reasons, this proceeding is referred to as the Murrell proceeding.

In the statement of claim filed in the Murrell proceeding on 25 November 2019, the Murrells claim:

In relation to the declaratory relief concerning the proper construction of the Restriction, the Murrells plead that:

As I have referred to earlier in these reasons, the Owners Corporation accepts that DP 871094, which created the horizontal subdivision that separated title to the Airspace from title to the remainder of Lot 21, was expressly subject to the Restriction. However, the Owners Corporation disputes that the Restriction contained the implied positive covenant or easement for which the Murrells contend. The Owners Corporation contends that the Restriction had no work to do following the registration of DP 871094.

The Owners Corporation also accepts that SP 85044 and folio CP/SP 85044 expressly record that the common property in the strata scheme (including the Airspace) is limited in stratum in the manner described in DP 871094. However, the Owners Corporation contends that this does not have the effect of rendering its title to the common property subject to the Restriction. The Owners Corporation denies that its rights in respect of the Airspace are subject to the Restriction.

The Murrells’ alternative claims for relief under s 89 of the Conveyancing Act, and the Owners Corporation’s defence of those claims, proceed on the assumption that the Restriction did survive the registration of SP 85044 and, on its proper construction, did not include the implied positive covenant or easement for which the Murrells contend.

Section 89 of the Conveyancing Act relevantly provides:

If the Restriction prevents the owner of Lot 21 from exceeding the height of RL 26.00 AHD to repair, maintain and/or improve the flat concrete roof of the dwelling on Lot 21 on a temporary or transitory basis (contrary to the construction of the Restriction for which the Murrells contend), then the Murrells contend that this impedes the reasonable user of Lot 21 without securing any practical benefit to the Owners Corporation or the Unit Owners because:

The Murrells seek an order modifying the Restriction so as to permit the owner of Lot 21 exceeding the height of RL 26.00 AHD on a temporary or transitory basis for the purpose of repairing, maintaining and/or improving the flat concrete roof of the dwelling on Lot 21. The order is sought under s 89(1)(a) of the Conveyancing Act or, alternatively, under s 89(1)(c) of the Conveyancing Act on the basis that the modification will not substantially injure the Owners Corporation or the Unit Owners.

The Owners Corporation denies that the Restriction impedes the reasonable user of Lot 21 without securing any practical benefit to the Owners Corporation or Unit Owners for three reasons.

First, the Owners Corporation contends that the Restriction does not prevent the owners of Lot 21 from exceeding the height of RL 26.00 AHD to repair, maintain and/or improve the flat concrete roof on a temporary or transitory basis because:

Second, the Owners Corporation does not admit that the Murrells have suffered water damage to the flat concrete roof of the residence on Lot 21.

Third, the Owners Corporation contends that the Restriction does secure a practical benefit to the Owners Corporation and Unit Owners because:

For the same three reasons, the Owners Corporation denies that the modification of the Restriction sought by the Murrells will not substantially injure the Owners Corporation or the Unit Owners.

The Owners Corporation therefore opposes the Murrells’ application for orders under s 89(1)(a) and/or s 89(1)(b) of the Conveyancing Act modifying the Restriction.

Section 88K of the Conveyancing Act relevantly provides:

As referred to in [49(4)] above, the terms of the order sought by the Murrells under s 88K in the summons and statement of claim filed on 25 September 2019 and 25 November 2019 respectively are an easement to permit:

Late in the afternoon on the final day of the hearing, the Murrells applied for leave to amend their pleadings to seek an easement under s 88K to permit:

Given the timing of the amendment application, the Murrells’ submissions in support of the application and the Owners Corporation’s submissions opposing the proposed amendment were made in writing following the conclusion of the hearing and the Court’s decision in respect of the amendment application was reserved to be delivered at the same time as judgment in the proceeding.

The Murrells contend that, if the Restriction prevents the owner of Lot 21 from exceeding the height of RL 26.00 AHD to repair, maintain and/or improve the flat concrete roof of the dwelling on Lot 21 on a temporary or transitory basis (contrary to the construction of the Restriction for which the Murrells contend), then an easement in the terms sought is reasonably necessary for the effective use or development of Lot 21 because the flat concrete roof cannot otherwise be accessed to effect repairs without exceeding the height of RL 26.00 AHD due to the space of only 11 to 16 centimetres between the roof and RL 26.00 AHD. As noted above, the Murrells contend (and the Owners Corporation denies) that the roof has sustained water damage.

The Owners Corporation denies that the proposed easement is reasonably necessary, referring again to:

The Murrells further contend that the use of Lot 21 with the proposed s 88K easement will not be inconsistent with the public interest. The Owners Corporation denies this.

The Murrells contend that the Owners Corporation can be adequately compensated for any loss or disadvantage arising from the imposition of the proposed s 88K easement, noting that:

The Murrells’ statement of claim contains an offer to compensate the Owners Corporation in such amount as may be determined by the Court.

The Owners Corporation denies that it can be adequately compensated.

The Murrells claim that they have made, and continue to make, all reasonable attempts to obtain the proposed easement, but they have been unsuccessful. The Owners Corporation denies that the Murrells have made all reasonable attempts to obtain the easement.

For completeness, I mention here that the Owners Corporation opposes the Murrells’ application for leave to amend the terms of the easement sought under s 88K of the Conveyancing Act. It will be necessary to return to that issue later in these reasons, before determining the application under s 88K (either on the basis of the original pleading, or the amended pleading if leave to amend is granted).

The issues to be resolved in order to determine the parties’ claims in the two proceedings, and my conclusions in relation to each issue, may be summarised as follows:

The detailed reasons for each my conclusions summarised above follows, structured in same the order as the issues set out above.

Although there is an issue as to whether the Owners Corporation’s title to the Airspace is subject to the Restriction at all (see Issue 2 below), it is convenient to address first the issues raised by the Murrells concerning the proper construction of the Restriction.

The declarations sought by the Murrells are in the following terms:

In their written closing submissions, the Murrells described the declaration sought as a declaration that the Restriction, properly construed, does not prohibit the servient tenement owner from exceeding the height of RL 26 AHD for those purposes.

However, in oral opening submissions and oral closing submissions, [23] senior counsel for the Murrells submitted that the Restriction includes an implied positive covenant or easement for the owners of Lot 21 to exceed the height of RL 26 AHD, and that this implied positive covenant continued to operate, in substance as an easement, following the registration of the Airspace plan of subdivision because DP 871094 included the Restriction as notation “B” (see [23] above).

In the Murrells’ oral closing submissions, the implied positive covenant or easement contention overtook the more circumspect contention that the Restriction did not prohibit or prevent owner of Lot 21 from exceeding the height of RL 26.00 AHD on a temporary or transitory basis in order to repair, maintain and/or improve structures on Lot 21 that exist below the height of RL 26.00 AHD. I will nevertheless address both contentions below.

It was common ground that, in construing a restrictive covenant registered on Torrens title land:

However, there was some dispute between the parties as to the nature of the physical characteristics of the tenements that the Court may take into account.

The Murrells submitted that the Court should have regard to physical characteristics of the tenements that are recorded on the Register (in this case, the height of the flat concrete roof approximately 11 to 16 centimetres below the height limitation of Part Lot 21) or about which information was otherwise readily available to third parties (in this case, geographical location of 95 and 97 Wentworth Road and the orientation of both properties towards views of Sydney Harbour).

The Owners Corporation accepted that it is permissible to take into account the boundaries of the land and neighbouring lots, and the view from the properties, for the purpose of ascertaining objectively the parties’ intentions and construing the Restriction. However, the Owners Corporation submitted that it is not permissible to take into account the height of the concrete roof, for two reasons. First, the roof is not necessarily a permanent structure on the land and should not be treated as a “structure of title, if there is such a thing”. Second, the area to which the Restriction applied was much larger than the area of the concrete roof (as to which, see [21] above). [24]

I accept the Murrells’ submission that, because the height of the flat concrete roof was expressly noted on registered plan DP 645772 that created the Restriction, the height of that roof compared to the height of RL 26.00 AHD stipulated in the Restriction is a matter that the Court can and should take into account in construing the Restriction.

I accept, as the Murrells submitted, that the Register includes not only the certificates of title but also, amongst other things, the folios, dealings and deposited plans: Real Property Act 1900 (NSW), s 31B; Westfield Management Ltd v Perpetual Trustee Company Ltd (supra) at [4]–[5] (per curiam); Sertari Pty Ltd v Nirimba Developments Pty Ltd (supra) at [15]–[16].

In my opinion, it is clear from the judgment of the High Court in Westfield Management Ltd v Perpetual Trustee Company Ltd (supra) that the underlying principle that informs the scope of extrinsic circumstances that may be taken into account in construing easements and restrictive covenants is the scheme of the Torrens system, normally that the information in the folios of the public register and the registered dealings provides third parties with “the information necessary to comprehend the extent or state of the registered title to the land in question”. [25] As the Court said: [26]

I respectfully agree with the obiter dicta of Fryberg J in Currumbin Investments Pty Ltd v Body Corp Mitchell Park Parkwood Cts [2012] 2 Qd R 511; [2012] QCA 9 at [48]–[49] that cases may arise where even a physical characteristic of the tenement cannot be taken into account in construing an easement or restriction because the nature of the characteristic is such that a third party, at the time easement or restriction falls to be construed, may be unable to ascertain whether the relevant characteristic existed at the time the easement or restriction was created. In such cases, it would be inconsistent with the scheme of the Torrens system, as confirmed by the High Court in Westfield Management Ltd v Perpetual Trustee Company Ltd (supra), to have regard to those physical characteristics. [27]

I accept the Owners Corporation’s submission that the height of the flat concrete roof on Lot 21 may change over time. Indeed, the roof, or the whole of the residence, may be rebuilt at a different height to that noted on the plan. However, a third party wishing to understand the height of the roof at the time that the Restriction was created in order to understand the nature and extent of the Restriction, properly construed, will be able to do so by reviewing DP 645772, which forms part of the Register and contains a notation of the height of the concrete roof. The proper construction of the Restriction is an exercise in ascertaining objectively the parties’ intention at the time the Restriction was created. It is therefore permissible, in my opinion, to take into account the height of the flat concrete roof in determining the proper construction of the Restriction in this case.

Applying the principles referred to above, the height of the flat concrete roof as recorded on DP 645772 is not the only physical characteristic of the tenements to be taken into account in determining the meaning of the Restriction.

It was common ground that the relevant physical characteristics include the orientation of 95 and 97 Wentworth Road towards views of Sydney Harbour.

In my opinion, the relevant characteristics must also include that, at the time that the Restriction was created, the title to the dominant tenement (now Lot 21) included the Airspace.

It was submitted on behalf of the Murrells that the following matters support the making of a declaration in the terms sought (as set out in [78] above):

The Murrells relied on the sixth submission referred to immediately above as not only supporting a construction of the Restriction as not preventing the servient tenement owner from exceeding the height of RL 26 AHD on a temporary or transitory basis to repair, maintain and/or improve any structures on the servient tenement that exist below that height, but also as warranting a construction of the Restriction as including an implied positive covenant or easement entitling the servient tenement owner to do so. It was submitted that the “absurd results” referred to in the submission could only be avoided by interpreting the Restriction as including the implied positive covenant or easement for which the Murrells contended.

I accept the Murrells’ first submission that the words “matter or thing” do not, in their ordinary meaning, include persons. The submissions of the Owners Corporation acknowledged that an interpretation of “matter or thing” as including persons would be awkward. In my opinion, there is nothing in the language of the Restriction, read in the context of the whole of the s 88B instrument, that warrants such a strained interpretation of those words. In particular, the examples of “matter or thing” set out in the Restriction are “improvements”, “moveable items” and “plants or natural growth”. Whilst those examples do not limit the generality of the expression “matter or thing”, they do not warrant construing those words as including persons in this context.

Subject to one qualification, I accept the Murrells’ second, third and fourth submissions, for the following reasons.

I accept the submission of the Owners Corporation that the words “matter or thing of any nature whatsoever” (my emphasis), the inclusion of “moveable items” in the examples of such matters or things, and the words “placed on or permitted to remain on at any time” (in addition to the words “constructed on” and “erected on”) clearly point to the parties’ intention at the time the Restriction was created to prohibit the placing of items on the servient tenement that exceed the stipulated height of RL 26.00 AHD, irrespective of whether those items were of a nature designed to be affixed or to remain permanently in place. (I add that the inclusion of those words distinguishes the terms of the Restriction from the terms considered in Panton (supra), and the interpretation of the words “erect” and “structure” in the context of the instrument under consideration in Panton is not applicable to the interpretation of similar words in the different context of the Restriction.)

However, having regard to the very small distance between the height of the concrete roof and the RL 26.00 AHD height limit imposed by the Restriction, as plainly recorded in DP 645772, this construction of the Restriction would result in the servient tenement owners being unable to use equipment of height greater than 11 to 16 centimetres when accessing the roof for the purposes of repairs and maintenance, unless the words “placed on or permitted to remain on at any time” are construed as meaning placed or permitted to remain other than on a temporary basis. This construction of the words “placed on or permitted to remain on at any time” avoids the absurd result that the servient tenement owners are themselves able to access the roof, but are unable to use equipment of a height greater than 11 to 16 centimetres on the roof for the purposes of repairs and maintenance. That result would be absurd owing to the obvious potential detriment and prejudice to the servient tenement owners, which is disproportionate to the benefits sought to be conferred on the dominant tenement owners by the Restriction (to which I refer further immediately below). In my opinion, the Court should not attribute to the parties an intention to detract from the servient tenement owner’s ability to use their own airspace in a manner that achieves such an absurd result. (The Airspace was still part of the servient tenement when the Restriction was created).

I consider that the physical characteristics of the tenements on which the Murrells rely in their third submission provide further support for my construction of the words “placed on or permitted to remain on at any time” as meaning placed or permitted to remain other than on a temporary basis. However, the qualification is that I should not be taken as accepting that the physical characteristics of the tenements demonstrate that the object or purpose of the Restriction was limited to securing the views from 95 Wentworth Road towards Sydney Harbour. In my view, the physical characteristics of the tenements are equally consistent with the Restriction having additional objects, such as to secure the privacy of the owners or occupants of 95 Wentworth Road. My construction of the Restriction does not undermine either the object of securing harbour views or the object of securing privacy.

As to the Murrells’ fifth submission, I do not consider that the description of the Restriction in notation “B” on DP 399130 adds to or detracts from the analysis immediately above. It is clear from the terms of the Restriction as set out in the s 88B instrument that the prohibition applies only to the extent that the matters or things exceed the height of RL 26.00 AHD.

In relation to the sixth submission, the Restriction, upon its proper construction, does not prevent the servient tenement owner from exceeding the height of RL 26 AHD on a temporary or transitory basis to repair, maintain and/or improve any structures on the servient tenement that exist below that height, for the reasons that I have explained in [96]–[100] above.

However, it does not follow, in my opinion, that the Restriction includes an implied positive covenant or easement entitling the servient tenement owner to exceed the height of RL 26.00 AHD on the servient tenement on a temporary or transitory basis to repair, maintain and/or improve any structures on the servient tenement that exist below that height. The Restriction, properly construed, avoids the absurdity that the Murrells refer to without the implication of the positive covenant or easement contended for. At the time the Restriction was created (being the relevant time for the purpose of determining its proper construction), the servient tenement owners were entitled to use all of their land, including the Airspace, in any manner they saw fit, subject to environmental and planning laws and the limitations imposed by the Restriction. There is no evidence that the parties contemplated, at that time, that the servient tenement owners would cease to own the Airspace in the future. There is no basis for attributing to the parties an intention to confer on the servient tenement owners a positive right that they already had as a matter of law, or an easement over their own land.

The Murrells’ submissions in support of construing the Restriction as including an implied positive covenant or easement drew directly or by analogy on principles relevant to easements of necessity. However, it follows from my construction of the Restriction that any relevant “necessity” arose only on the registration of the Airspace plan of subdivision [28] and is therefore irrelevant to the construction of the Restriction. It will be necessary to return to the question whether the Murrells have the benefit of an easement of necessity in addressing Issue 4 below.

For the reasons above, the Restriction, upon its proper construction, does not prevent the owner of Lot 21 from exceeding the height of RL 26.00 AHD on a temporary or transitory basis to repair, maintain and/or improve any structures on the servient tenement that exist below that height. However, the Restriction does not include a positive covenant or easement expressly permitting the owner of Lot 21 to exceed that height for those purposes.

In the present circumstances, it is not the Restriction that impedes the Murrells’ ability to exceed the height of RL 26.00 AHD on Lot 21 for those purposes. Rather, that impediment is attributable to the change in ownership of the Airspace after the Restriction was created, together with the inability of the Murrells to enforce against the Ownership Corporation any easement of necessity that arose as a matter of law in favour of the owners of Lot 21 on the registration of the Airspace plan of subdivision. The Murrells inability to enforce any such easement of necessity is addressed under Issue 4 below.

Because the Restriction per se does not impede the Murrells’ ability to exceed the height of RL 26.00 AHD on Lot 21 for the purposes specified in the proposed declaration in prayer 1 of the statement of claim in the Murrell proceeding, that proposed declaration is of no practical utility, and therefore should not be made, [29] in my opinion.

Accordingly, the Murrells’ claim for declaratory relief in prayer 1 of the statement of claim in the Murrell proceeding is dismissed.

Because the Restriction does not include a positive covenant or easement expressly permitting the owner of Lot 21 to enter the Airspace on a temporary or transitory basis for the purpose of repairing, maintaining or improving structures on Lot 21, the Murrells have failed to establish the factual and legal basis for the declaration sought in prayer 2 of the statement of claim in the Murrell proceeding. That claim for declaratory relief is also dismissed.

For completeness, I note the Owners Corporation’s submissions to the effect that the Court should not make the declarations sought in prayers 1 and 2 of the statement of claim in the Murrell proceeding because the declarations are not necessary in order to permit the Murrells to enter into the Airspace for the purpose of performing any emergency work. The Owners Corporation submitted that the doctrine of necessity will provide the Murrells with a defence to a claim in trespass in respect of any entry into the Airspace that is reasonable necessary for the purpose of addressing a situation of immediate danger. I have not found it necessary to address these submissions in the context of Issue 1 because the terms of the declaratory relief sought by the Murrells was not confined to emergency work or situations of immediate danger. However, it will be necessary to return to the subject of the doctrine of necessity in the context of Issue 4 and Issue 5 below.

The Owners Corporation did not seek to withdraw its admission on the pleadings that the Airspace plan of subdivision was expressly subject to the Restriction. However, the Owners Corporation submitted that, because the Restriction does not include an implied positive covenant or easement entitling the owners of Lot 21 to enter into the Airspace for a specified limited purpose, the Restriction had no work to do once the Airspace plan of subdivision was registered, notwithstanding that the Restriction remained part of the Register at that time. It was in this sense that the Owners Corporation submitted that the Restriction was “otiose” from the time of registration of the Airspace plan of subdivision.

The Murrells submitted that the Restriction did have work to do following the registration of the Airspace plan of subdivision because:

I have already rejected the first element of the Murrells’ submissions in determining Issue 1 above. I reject the second and third elements of the submission for the same reasons, as they depend on the acceptance of the first element.

Technically, after the registration of the Airspace plan of subdivision, the Restriction continued to apply to all activities on Lot 21 below the height of RL 26.00 AHD that had the potential to result in “matters or things” on Lot 21 exceeding that height. However, this added nothing to the practical realities that flowed from the fact that the owners of Lot 21 no longer owned the Airspace above RL 26.00 AHD. I therefore accept the Owners Corporation’s submission that the Restriction, properly construed, had no meaningful or practical work to do once the Airspace plan of subdivision was registered.

The issue of whether the Murrells have the benefit of an implied easement of necessity arising at general law is considered separately under Issue 4 below.

As I have referred to in [52] above, the Owners Corporation denies that its rights to the Airspace are subject to the Restriction. The submission made in support of this denial was that the Restriction had “fallen away” on the registration of SP 85044 because: [30]

It was submitted on behalf of the Murrells that the Owners Corporation’s contention that the Restriction had “fallen off” the Register erroneously assumes that the Register comprises nothing more than the certificate of title or folio for the common property of SP 85044. It was submitted that the Register comprises all that is on the Register, and that the folio for the common property: [34]

It was also submitted on behalf of the Murrells that the Owners Corporation’s contention that the Restriction had “fallen away” is contrary to the assumption implicit in the Owners Corporation’s defence of the Murrells’ claims for relief under s 89 of the Conveyancing Act that the Restriction remains on the title, but should not (in the Owners Corporation’s submission) be modified pursuant to s 89.

The submissions of the Owners Corporation summarised in [116] above accurately describe the information recorded in the folio for the common property, in SP 85044 and in DP 871094. In my opinion, those submissions also accurately describe the interaction between the information recorded in that folio and the notations on SP 85044 and DP 871094. That is to say, I accept that the information recorded in the folio does not incorporate by reference the Restriction recorded on DP 871094. Rather, the information recorded in the folio incorporates only the limitation in depth of that part of the common property comprising the Airspace to RL 26.00 AHD.

In my opinion, the Restriction did not “fall off”, or cease to form part of, the Register upon the registration of SP 85044. As submitted by the Murrells, the Register comprises more than the folio for each parcel of Torrens system land, and includes registered plans and dealings: Real Property Act, s 31B; Westfield Management Ltd v Perpetual Trustee Company Ltd (supra) at [4]–[5] (per curiam); Sertari Pty Ltd v Nirimba Developments Pty Ltd (supra) at [15]–[16]. The Restriction could not cease to form part of the Register without any application being made under s 89 of the Conveyancing Act to extinguish the Restriction.

It does not necessarily follow that the Owners Corporation’s title to the Airspace is subject to the Restriction. That question depends, in my view, on the application of s 42 of the Real Property Act to the recordings in the folio of the Register for the common property referred to in [116] above, and whether the indefeasible title of the Owners Corporation to the Airspace is held subject to any personal equity. However, the Owners Corporation’s submissions did not raise any issue concerning s 42. The pleaded contention that its title to the Airspace is not subject to the Restriction was put solely on the basis that the Restriction had “fallen off” the Register. Accordingly, the submissions made on behalf of the Murrells also did not address the application of s 42 or any relevant personal equity.

In my view, absent any evidence of any relevant personal equity, it is doubtful that the Owners Corporation’s title to the Airspace is subject to the Restriction. However, it would not be appropriate to express a final view about this question which was not addressed by the parties. In any event, having regard to my conclusions concerning the proper construction of the Restriction (see Issue 1 above) and my conclusions concerning the Murrells’ claim for relief under s 89 of the Conveyancing Act (assuming that the Owners Corporation’s title is subject to the Restriction, although the Restriction has no work to do as I have held above), the question whether the Owners Corporation’s title to the Airspace is subject to the Restriction is not determinative of the parties’ claims for relief in these proceedings.

Following the registration of DP 87104, the Restriction became otiose in the sense that there was no scope for the Restriction to operate in a manner that imposed limitations on the owner of Lot 21 in addition to the limitations that resulted from the Airspace being owned by the proprietor of Lot 22. However, the Restriction did not “fall off” the Register.

For the reasons set above under Issue 1, the Murrells’ claims for declarations in the terms of prayers 1 and 2 of the statement of claim in the Murrell proceeding are dismissed. As the Murrells failed to establish the factual and legal basis for the declarations sought, it is not necessary to address the parties’ submissions concerning whether declaratory relief should be refused on discretionary grounds.

The Murrells submitted that an easement permitting the owners of Lot 21 to enter the Airspace on a temporary or transitory basis for the purpose of maintenance, repair or improvement of structures on Lot 21 below the height of RL 26.00 AHD was implied on two bases:

I have already rejected the first basis for the reasons set out under Issue 1 above.

This section of these reasons deals only with the second basis, which was raised for the first time in the Murrells’ closing submissions.

The applicable legal principles were summarised by Brereton J (as his Honour then was) in Rixon v Horseshoe Pastoral Co Pty Ltd [2017] NSWSC 1293 (citations omitted): [35]

In relation to the prevailing view that the implication of an easement of necessity is based on the presumed common intention of the parties, Brereton J referred to North Sydney Printing Pty Ltd v Sabemo Investment Corp Pty Ltd [1972] 2 NSWLR 150, in which Hope J (as his Honour then was) reviewed the authorities in detail and concluded (at 160, emphasis added):

In Nickerson v Barraclough [1981] 1 Ch 426, Brightman LJ referred to North Sydney Printing v Sabemo Investment Corp (supra) with approval in concluding (at 440–441) that the doctrine of easements of necessity is not founded on public policy, but on implication from the circumstances. The Court endeavours to ascertain the parties’ intentions by construing the document recording the conveyance of the land and by having regard to the circumstances associated with the conveyance. Everleigh and Buckley LLJ agreed with Brightman LJ on that issue. Buckley LJ said (at 447):

The first question is whether a right for the owners of Lot 21 to enter the Airspace on a temporary or transitory basis for the purpose of maintenance, repair or improvement of structures on Lot 21 below the height of RL 26.00 AHD was essential, as opposed to merely convenient, in all the circumstances that existed when the Airspace plan of subdivision was registered on 11 September 1997. The relevant circumstances included that the height of the concrete roof on part of Lot 21 was only between 11 centimetres and 16 centimetres below the boundary between Lot 21 and the Airspace, meaning that the entry of any persons and placement of any equipment on that roof for the purpose of repairs, maintenance and improvements to the roof would inevitably result in entry into the Airspace.

In determining whether the right was essential rather than merely convenient at the time of registration of the Airspace plan of subdivision on 11 September 1997, it is necessary to take into account that:

In my opinion, it is unlikely that the owners of Lot 21 and Lot 22 intended, at the time when the Airspace plan of subdivision was registered, that the owners of Lot 21 who had hitherto been able to enter onto their flat concrete roof for the purpose of any repairs, maintenance and improvements to the roof (provided that such repairs, maintenance or improvements did not result in the structures on Lot 21 exceeding the height of RL 26.00 AHD except on a temporary or transitory basis), should bear the cost and burden of a s 88K application if they should wish to repair, maintain or improve the roof in the future, save for repairs to address immediate danger posed by the state of the roof.

On the contrary, I consider that the Court should attribute to the owners of Lot 21 and Lot 22 at that time an intention that the owners of Lot 21 would be entitled to enter the Airspace on a temporary or transitory basis for the purpose of maintenance and repair of structures on Lot 21 below the height of RL 26.00. In my opinion, such a right of entry for maintenance and repairs was necessary, rather than merely convenient. Without such a right, the owners of Lot 21 would be unable to take sensible steps for the ongoing maintenance of the roof so as to avoid situations of imminent danger arising from the state of the roof. By contrast, a right for the owners of Lot 21 to enter the Airspace for the purpose of improvements may have been convenient, but was not necessary.

For those reasons, an implied easement of necessity arose by operation of law on the registration of the Airspace plan of subdivision on 11 September 1997, which permitted the owners of Lot 21 to enter the Airspace on a temporary or transitory basis for the purpose of maintenance and repair of structures on Lot 21 below the height of RL 26.00 AHD.

However, at that time, Mr and Mrs Michael were the registered proprietors of Lot 21 and Stromness Pty Ltd was the registered proprietor of Lot 22, including the Airspace. The Murrells are the successors in title to Mr and Mrs Michael and the Owners Corporation is the successor in title to Stromness Pty Ltd. Lot 21 and Lot 22 are Torrens title land.

Because the issue of an implied easement of necessity was raised for the first time in the Murrells’ closing submissions, neither the Murrells nor the Owners Corporation addressed the question whether any implied easement of necessity that arose on registration of the Airspace plan of subdivision could be enforced by the successors in title to the original owners of Lot 21 against the successors in title to the original owners of the Airspace.

In my opinion, the implied easement of necessity that I have found arose for the benefit of Lot 21 on registration of the Airspace plan of subdivision cannot be enforced by the Murrells against the Owners Corporation as the successor in title to the registered proprietor of Lot 22 at the time the easement arose, by reason of s 42 of the Real Property Act. Indeed, there is some doubt about whether an easement of necessity could have been enforced by Mr and Mrs Michael against Stromness Pty Ltd, even assuming for present purposes that Mr and Mrs Michael had a personal equity against Stromness Pty Ltd: Parish v Kelly (1980) 1 BPR 9394 at 9401–9402; Lamos Pty Ltd v Hutichson (1984) 3 BPR 9350 at 9356; McGrath v Campbell (2006) 68 NSWLR 229; [2006] NSWCA 180 at [102]–[118] (Tobias JA, Giles and Hodgson JJA agreeing); Rixon v Horseshoe Pastoral Co Pty Ltd (supra) at [37]–[43]; Cuzeno Pty Ltd v Owners – Strata Plan 65870 [2013] NSWSC 1385 at [93].

An implied easement of necessity arose by operation of law on the registration of the Airspace plan of subdivision on 11 September 1997, which permitted the owners of Lot 21 to enter the Airspace on a temporary or transitory basis for the purpose of maintenance or repair of structures on Lot 21 below the height of RL 26.00 AHD.

However, the Murrells cannot enforce that implied easement against the Owners Corporation by reason of s 42 of the Real Property Act.

The legal principles applicable to causes of action in trespass and in nuisance were not in dispute.

The Murrells submitted, and the Owners Corporation did not dispute, that: [36]

The dispute between the parties in relation to the cause of action in nuisance, turned on the questions whether the Murrells’ entries into the Airspace were permitted by the Restriction (and they were not, for the reasons explained under Issue 1 above) and, if not, whether those entries constituted a substantial and unreasonable interference with the property, or some right over or in connection with property: [38] Marketform Managing Agency Ltd v Amashaw Pty Ltd (2018) 97 NSWLR 306; [2018] NSWCA 70 at [52] (Meagher JA, Leeming JA agreeing).

The Owners Corporation’s pleaded case in trespass and nuisance was a claim for loss and damage said to have been suffered by the Owners Corporation as a result of the alleged trespass and/or nuisance.

The particulars of loss and damage said to have been suffered by the Owners Corporation as a result of the entries into its Airspace were set out in paragraphs (iv) to (vii) of paragraph 25 of the amended statement of claim in the Owners Corporation proceeding:

Ultimately, there was no evidence to support the claim for damages in respect of the expenses particularised in (vii) above, and that aspect of the claim was not pursued by the Owners Corporation. [39]

The nature of the loss of privacy and loss of amenity particularised in (iv) to (vi) above means that it can only have been suffered by Unit Owners and not by the Owners Corporation.

That issue was raised by paragraph 23(b) of the defence filed by the Murrells in the Owners Corporation proceeding, and reiterated in closing submissions made on behalf of the Murrells. [40]

In relation to the cause of action in nuisance, the submissions made on behalf of the Owners Corporation accepted that the alleged interference was to the Unit Owners’ use and enjoyment of their land, but submitted that it could prosecute the action in nuisance “on the principles of agency”. [41]

The Owners Corporation’s submissions did not address the question whether it could prosecute the action in trespass to recover damages for loss of privacy or amenity suffered by individual Unit Owners.

Under the statutory scheme pursuant to which the Owners Corporation holds title to the common property (including the Airspace) as agent for the Unit Owners, the Unit Owners have a beneficial interest in the Airspace. The salient features of that statutory scheme under the Strata Schemes Development Act 2015 (NSW) (the 2015 Act), which commenced in November 2016, and under the Strata Schemes (Freehold Development) Act 1973 (NSW) (the 1973 Act) as it applied when SP 85044 was registered on 11 March 2011 may be summarised as follows:

I note that s 24(2) of the 1973 Act expressly described the interest of a lot owner in common property as a “beneficial interest”, whereas s 28(2) of the 2015 Act simply refers to a lot owner’s “interest” in the common property.

At the time that the 2015 Act was enacted, it was well established that the statutory “agency” pursuant to which an owners corporation holds the common property of a strata scheme is, or is analogous to, a trust and that the owners of lots in the scheme have an equitable interest in the common property: Owners – Strata Plan 43551 v Walter Construction Group Ltd (2004) 62 NSWLR 169; [2004] NSWCA 429 at [41]–[46] (Spigelman CJ, Ipp and McColl JJA agreeing) and the authorities there referred to; Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 (2014) 254 CLR 185; [2014] HCA 36 at [10] (French CJ); see also McElwaine v The Owners – Strata Plan 75975 (2017) 18 BPR 37,207; [2017] NSWCA 239 at [37] (White JA, Basten JA and Sackville AJA agreeing), [42] endorsed in EB 9 & 10 Pty Ltd v Owners of Strata Plan 934 (2018) 98 NSWLR 889; [2018] NSWCA 288 at [31] (Barrett AJA, Meagher and Gleeson JJA agreeing). In Community Association DP 270447 v ATB Morton Pty Ltd (2019) 240 LGERA 32; [2019] NSWCA 83 at [80]–[83], Leeming JA (with whom Bell P and Payne JA agreed) referred to this line of authority with approval, subject to the caveat that his Honour regarded it as proceeding on the basis that the statute (namely, the 1973 Act considered in those cases) referred not only to the “agency” of the owners corporation but also to the “beneficial interest” of lot owners in common property.

Reading s 28(2) in the context of the 2015 Act as whole, I do not consider that the reference to “interest” rather than “beneficial interest” in s 28(2) should be interpreted as displacing this well established characterisation of the interests of lot owners in common property and downgrading it to something less than an equitable interest in the common property.

Although the word “beneficial” has not been used in the redrafting of the provision that precludes a lot owner’s interest in the common property from being dealt with separately from the owner’s lot, the very fact that the legislature saw fit to include s 28(2) in the 2015 Act suggests that a lot owner’s interest in common property would otherwise be capable of being “dealt with” independently of his or her interest in their lot. The words “dealt with” in s 28(2) have been construed as referring to “dealings in a conveyancing sense, that is, as referring to matters such as the creation, disposition, variation, surrender or extinguishment of interests in or rights over common property”: McElwaine v The Owners – Strata Plan 75975 (supra) at [41] (White JA, Basten JA and Sackville AJA agreeing).

Moreover, s 118 of the 2015 Act, which relates to the resumption of common property, describes the interests of owners in common property as beneficial interests. Section 118(b) provides that the owners’ beneficial interests in common property that is to be resumed are taken to be vested in the owners corporation to the exclusion of the owners for the purpose of any claim for compensation in relation to the resumption.

As I have mentioned above, and as is confirmed by the discussion of the evidence and the findings of fact below, the nature of alleged loss of privacy or loss of amenity resulting from the alleged trespass or nuisance is such that it cannot have been suffered by the Owners Corporation as opposed to Unit Owners. Moreover, in this case, the evidence does not establish that any such loss was suffered by all Unit Owners.

To the extent that any Unit Owner has suffered loss of privacy or loss of amenity, the determination of the claim in nuisance depends, in substance, on whether this constituted a substantial and unreasonable interference with the enjoyment by that Unit Owner of their property rights derived from the ownership of their Unit together with their beneficial interest in the Airspace.

The Owners Corporation has no estate or interest in the Units. It is not the trustee or agent of the Unit Owners’ estate or interest in their Units. The Owners Corporation is only the legal owner of the Airspace. In my opinion, the statutory agency pursuant to which the Owners Corporation holds the legal title to the Airspace for the benefit of the Unit Owners does not confer on the Owners Corporation standing to bring an action in nuisance for an alleged substantial interference with each Unit Owner’s enjoyment of his or her property rights derived from ownership of the Unit merely because the enjoyment of those individual property rights is associated with enjoyment of the amenity provided by the Airspace.

I acknowledge that, under s 254 of the Strata Schemes Management Act 2015 (NSW), the Owners Corporation has a statutory right to take (or defend) proceedings in relation to the common property if the owners of the lots are jointly entitled to take such proceedings (or are liable to have proceedings taken against them jointly). However, s 254 applies only to an action taken by an owners corporation affecting all lot owners: Owners Corporation – Strata Plan 43551 v Walter Construction Group Ltd (supra) at [11]–[20] (Spigelman CJ, Ipp and McColl JJA agreeing). [43] Any judgment or order given in favour of (or against) the owners corporation in proceedings under s 254 has the effect as if it were a judgment or order in favour of (or against) the lot owners, and lot owners are liable to contribute to any such judgment debt against them in proportion to their unit entitlements: s 254(3) and (4).

In my opinion, even if the alleged interference with property rights affected all Unit Owners in this case (and the evidence does not establish this, as discussed further below), their entitlement to bring the action in nuisance would not be a joint entitlement within the meaning of s 254. Reading the words “jointly entitled” in s 254(2) in the context of s 254(3) and (4), it seems to me that those words refer to a right that lot owners have in common, and in respect of which there is one remedy to which they are entitled jointly, such that it would be just that they share in the fruits of any judgment (or the burden of any judgment debt) in proportion to their unit entitlements. The claim in nuisance in this case turns not only on the fact that the Murrells entered the Airspace, but also on the resulting impact on each Unit Owner’s enjoyment of their property rights. Even if evidence had been adduced concerning the impact on each Unit Owner (and it was not, as discussed further below), the impact must necessarily vary between Unit Owners having regard to the different locations of each Unit relative to the concrete roof on Lot 21 (as illustrated in the photograph reproduced in Annexure “A” to these reasons).

The basis of the action in trespass is the unauthorised entry onto the Owners Corporation’s property, rather than interference with the use and enjoyment of Unit Owners’ property rights. Because the Owners Corporation holds the legal title to the Airspace as agent for Unit Owners who have an equitable interest in the Airspace, the better view in my opinion is that the statutory agency confers standing on the Owners Corporation to bring claims in trespass as agent for individual Unit Owners for loss and damage alleged suffered by them as a result of the Murrells’ entries into the Airspace, even though the loss or damage is likely to vary between Unit Owners: Owners Corporation – Strata Plan 43551 v Walter Construction Group Ltd (supra) at [49]–[51] (Spigelman CJ, Ipp and McColl JJA agreeing). In any event, as will become apparent in the section of these reasons addressing Issue 6 below, the Owners Corporation’s claim for damages for trespass into the Airspace did not focus on compensation for the loss of amenity particularised. Rather, the claim was ultimately put as a claim for general damages vindicating the Owners Corporation’s property rights in respect of the Airspace.

It follows that the Owners Corporation’s claim relating to alleged trespass in the Airspace falls to be determined on the basis that the Owners Corporation has standing to prosecute that claim.

I have concluded that the Owners Corporation does not have standing to prosecute the claim in nuisance insofar as it relates to entries into the Airspace. However, in case of any appeal, I will indicate below the findings that I would have made concerning the claim in nuisance if the Owners Corporation had been found to have standing to prosecute that claim.

As I have already noted, the Murrells accept that their contractors entered onto the concrete roof of the dwelling on Lot 21, and therefore entered into the Airspace, during the period November 2018 and July 2019. [44]

The evidence concerning the occasions on which this occurred, and the circumstances in which this occurred, may be summarised as follows. To the extent that aspects of that evidence are the subject of dispute, I have identified the dispute and recorded my findings in the summary below.

Mr Howse is one of the owners of Unit 2 and is the Secretary of the Owners Corporation. In his affidavit sworn on 23 August 2019, Mr Howse has catalogued 13 occasions during the period between November 2018 and June 2019 on which the Murrells, or their contractors, entered the Airspace. Mr Howse has exhibited to his affidavit photographs taken by him on each of those occasions, depicting persons standing on the concrete roof of Lot 21. On some occasions several persons appear in the photographs to be viewing and discussing the roof. On other occasions, one or two persons appear to be scraping, cleaning, painting or carrying out other work on the roof, including placing and installing pipes on the roof.

In addition, Mr Howse deposed that contractors acting on behalf of the Murrells have brought and left equipment on the concrete roof of Lot 21 during the period from November 2018 to June 2019. Mr Howse has exhibited a photograph depicting a bucket left on the roof.

Mr Howse was not cross-examined about his evidence concerning the occasions on which the Murrells’ contractors have entered the Airspace.

The submissions made on behalf of the Owners Corporation did not refer to the Murrells’ entries into the Airspace as having had any particular impact on the Owners Corporation or Unit Owners, or as having interfered with the Unit Owners’ or Owners Corporations’ enjoyment of their respective property rights. Nor did the submissions identify any particular facts, matters or circumstances relied on in support of the Owners Corporation’s contention that any such interference was substantial and unreasonable.

Mr Howse deposed that the works carried out on the roof had caused “significant disturbance to myself and other units owners within the OC property which can be clearly heard through conversations, the use of machinery and scraping machines and vacuum cleaner units and other apparatus used by them. That noise is clearly audible from each of the units on the northern side of the OC property at 95 Wentworth Road and in particular inside those apartments which at times is particularly loud and disturbing.” [45]

Again, Mr Howse was not cross-examined about this evidence. However, his evidence carries little weight to the extent that purports to relate to disturbance experienced by persons other than himself, or from within units other than Unit 2. Mr Howse’s evidence did not identify any basis for his assertions relating to other persons and other units.

It is also relevant to note that Mr Howse gave no evidence of the duration of the contractors’ presence in the Airspace on each of the occasions that he identified, or the duration of any disturbance that he experienced as a result of their presence in the Airspace on any of those occasions. There is simply no evidence as to whether each of the 13 occasions involved noise disturbance for a matter of minutes, hours or the best part of a day. Some of the activities described as having been carried out by the workmen, such as painting, are not inherently noisy. I assume that other activities, such as scraping and vacuuming involve some noise, and I accept Mr Howse’ unchallenged evidence that noise of that nature was clearly audible from Unit 2. Similarly, I accept Mr Howse’ unchallenged evidence that conversations between persons on the roof involve was clearly audible from within Unit 2. However, there was no evidence about whether such activities or conversations were constant, frequent or only intermittent during the occasions on which those persons were present on the roof (noting, again, that the duration of those occasions was not proved).

I note that, in his affidavit sworn on 6 February 2020, Mr Howse did give evidence about significant noise disturbance and dust that he had experienced due to jackhammering and the use of mechanical excavators as part of the work being carried out by the Murrells. Mr Bakaric, the owner of Unit 3 and the Chairman of the Owners Corporation, also complained in his affidavit sworn on 8 February 2020 about intrusive noise caused by “heavy machine based jackhammering” and construction works causing the whole building at 95 Wentworth Road to shake. However, there is no evidence that any such work has been carried out on the roof of the dwelling on 97 Wentworth Road. It is clear from the photographs of the other works being carried on at the property that these works are likely to have been carried out at ground level, on Lot 21 (that is, without entering the Airspace). [46]

In the final paragraph of his affidavit sworn on 6 February 2020, Mr Howse deposed:

To the extent that the invasion of privacy referred to in the final paragraph of that affidavit relates to entries into the Airspace, Mr Howse has not explicitly described how the presence of workmen on the roof of 97 Wentworth Road, or the work carried out on the roof by those workmen from time to time, has interfered with his privacy in Unit 2. However, Mr Howse deposed in paragraph 4 of his affidavit sworn on 13 June 2019 that Unit 2 is situated directly next to the dwelling at 97 Wentworth Road, and that the distance between the balustrade on the balcony of Unit 2 and the surface of the flat roof on 97 Wentworth Road is less than 2 metres.

The photographs exhibited to Mr Howse’s 23 August 2019 affidavit show that the balcony of Unit 2 is almost level in height with the surface of the flat roof on 97 Wentworth Road, and that persons present on that roof have a clear line of sight through the glass balustrade of that balcony into the balcony space of Unit 2. One of the photographs also suggests that persons on the roof of 97 Wentworth Road would also be able to see into one of the internal living areas of Unit 2, at least if the door between that living area and the balcony were open. I therefore infer that the presence of persons on the flat roof of 97 Wentworth Road caused some loss of privacy to occupants of Unit 2, at least whilst they are using that part of their balcony that is adjacent to that roof. As can be seen clearly from other photographic evidence reproduced in Annexure “A” to these reasons, [47] the balcony of Unit 2 extends around to the other side of the building on 95 Wentworth Road, from which the flat roof on 97 Wentworth Road would not be visible.

On the basis of the evidence referred to above, I characterise the loss of privacy to Unit 2 on the occasions when persons entered the Airspace as incidental, in the sense that it involves the presence of persons in the vicinity of part of Unit 2’s balcony, but there is no evidence that those persons have been looking directly into the balcony or any other part of Unit 2. On the contrary, the photographic evidence exhibited to Mr Howse’s affidavit depicts the persons on the roof of 97 Wentworth Road being preoccupied with their inspection of the roof, or work being carried out on the roof, and not looking in the direction of Unit 2 at all.

Mr Howse’s evidence did not refer to the presence of contractors on the roof of 97 Wentworth Road interfering with his enjoyment views of the harbour from Unit 2 at 95 Wentworth Road. It is clear from the photographs exhibited to Mr Howse’s affidavit sworn on 23 August 2019 that their presence caused some interference with those views, but did not obstruct the view of the harbour. As the evidence does not establish the duration of the contractors’ presence on the roof on each occasion, the duration of interference of views on each occasion is not proved.

In his affidavit sworn on 8 February 2020, Mr Bakaric complained that:

If the roof of 97 Wentworth Road provides a vantage point for looking directly into Unit 2 (as Mr Howse description of Unit 2 suggests and as the photographs exhibited to his affidavit depict), it is difficult to understand how a person standing on that roof would also be able to look directly into Unit 3, which is one floor higher than Unit 2. This is illustrated by the photograph reproduced in Annexure “A” to this reasons. Having regard to that photograph and to Mr Howse’s evidence, the evidence adduced by the Owners Corporation does not establish on the balance of probabilities that entry into the Airspace by the Murrells (or contractors engaged by the Murrells) has caused lack of privacy to the owners of Unit 3 by persons being able to look inside Unit 3.

I note that Mr Bakaric gave no evidence concerning any noise heard within Unit 3 as a result of the activities of persons on the roof of 97 Wentworth Road (as opposed to noise resulting from other construction activities on 97 Wentworth Road).

The owners of Units 1 and 4 at 95 Wentworth Road gave no evidence at all.

For all of those reasons, I find that:

There is no evidence that:

A significant volume of evidence was adduced concerning the condition of the roof of Lot 21 during the period November 2018 to June 2019, and the communications between the Owners Corporation and the Murrells in relation to the entries into the Airspace up to the date of the hearing. Aspects of that evidence are relevant to the causes of action in trespass and nuisance, including the claims for aggravated and exemplary damages, and also to the claims for relief under s 89 and s 88K of the Conveyancing Act. It is convenient at this point to set out a chronological summary of all of that evidence so that relevant aspects of it can be understood in context. To the extent that the evidence was disputed, I have indicated this and set out my findings within this chronological summary.

On or about 15 November 2018, Professor Murrell met with Mr Howse and Dr and Mrs Bakaric to discuss certain changes that the Murrells proposed to make to 97 Wentworth Road. According to Professor Murrell’s notes of the meeting, he informed Mr Howse and Dr and Mrs Bakaric that he wanted to change the colour of the concrete roof and “change it over for some upturned metal seam zinc”. Professor Murrell did not seek the Owners Corporation’s consent at this meeting to do this work, or to enter onto the roof and into the Airspace for that purpose, but no objection was raised by those present. [48]

On 23 November 2018, Professor Murrell sent an email to Mr Howse and Dr Bakaric referring to the meeting the previous week and stating that painting of the roof would start the following week. [49]

Mr Howse replied to Professor Murrell by email on the same day, stating: [50]

On 24 November 2018, Professor Murrell sent a further email to Mr Howse, indicating that he had met with and consulted with Mr Howse and Dr and Mrs Bakaric out of courtesy only and was disappointed that they had changed their position. Professor Murrell attached his notes of the meeting on 15 November 2018 to the email. [51]

Consultants or contractors engaged by the Murrells accessed the concrete roof of Lot 21 on or about 27 November 2018 and 23 January 2019, intruding into the Airspace on each occasion. [52]

In his affidavit sworn on 6 February 2020, Professor Murrell deposed that he engaged Partridge Structural Pty Limited in about February 2019 to provide advice on the structural adequacy and the feasibility of modifying the dwelling on Lot 21. Professor Murrell deposed that he sought this advice because he became concerned about the structural integrity of the dwelling after it suffered some water damage to part of the ceiling beneath the pitched section of the roof (not the flat concrete roof) during a storm in December 2018 and after he reviewed a building report prepared for his insurer in connection with that damage. The building report does not mention the flat concrete roof. [53]

On about 9 April 2019, contractors engaged by or on behalf of the Murrells removed the membrane from the concrete roof of Lot 21. [54] This was done on the advice of the engineers and builders whom the Murrells had engaged for the purpose of a proposed development of Lot 21. The objective of removing the membrane was to carry out investigations to ascertain the state of the concrete roof. Professor Murrell gave evidence that, before the membrane was removed, he was concerned about the roof for several reasons, including that it had been built as long ago as about 1960, water pooled on the roof whenever it rained and he was advised that the vents installed on the roof by the previous owner were likely to be a sign that there was a problem with water collecting between the concrete roof and the membrane. [55]

Mr John Comino, the solicitor for the Owners Corporation, wrote to the Murrells on 9 April 2019 stating that the entry of workmen onto the concrete roof, and the performance of work on that roof was encroaching on the Airspace which was on the Owners Corporation’s title or subject to an easement for the benefit of SP 85044. The letter stated that the Owners Corporation had not approved this encroachment. The letter continued: [56]

Professor Murrell replied to Mr Comino’s letter on 10 April 2019. Professor Murrell wrote: [57]

In cross-examination, Professor Murrell readily accepted that the water damage referred to in his 10 April 2019 correspondence was water damage to the pitched roof. [58] It was put to him, and he denied, that the terms of his letter had been intended to mislead the Owners Corporation into believing that there had been water damage caused by the flat roof, and it was necessary to engage contractors to re-surface the roof in order to rectify that damage or prevent further damage. Professor Murrell maintained that his letter did not say that there had been damage to, or damage caused by, the concrete roof. Rather, the letter simply stated that there had been water damage, and that repairs were necessary. According to Professor Murrell’s evidence, repairs were necessary to the whole house on Lot 21. [59]

The wording of Professor Murrell’s 10 April 2019 letter was unclear as to whether the proposed re-surfacing of the roof was related to water damage. However, I accept Professor Murrell’s denial of any intention to mislead the Owners Corporation by the terms of that letter. In my opinion, that letter needs to be read in the context of the information conveyed to the Owners Corporation at the meeting on 15 November 2018 and his 12 April and 18 April 2019 correspondence referred to below. It was clear from those communications that Professor Murrell wished to apply a new surface to the concrete roof from as early as November 2018 (prior to the December 2018 water damage referred to in the 10 April 2019 letter). The information provided in the 12 and 18 April 2019 correspondence made it clear that the new surface then proposed involved the application of additional material, such as gravel, to the roof once a new waterproof membrane had been applied. The provision of this information in November 2018, and on 12 and 18 April 2019 is inconsistent with the alleged intention to mislead the Owners Corporation on 10 April 2019.

It appears from Mr Walford’s evidence referred to below that the Murrells were contemplating a green roof (including plants) as part of a potential development of Lot 21 as at April 2019. The evidence does not reveal at what point in time the Murrells decided that they wished to proceed with the proposed development, including the green roof. It may have been as late as July 2019. [60] The green roof proposal was not referred to in any correspondence from the Murrells to the Owners Corporation or Mr Comino during the period April to June 2019. It may have been one of the three options that the Murrells would have shown the Owners Corporation if a meeting that they proposed between their architects and members of the Owners Corporation on 5 June 2019 had proceeded. [61] In the events that happened, the Murrells first advised the Owners Corporation of their plans for a green roof on about 25 July 2019. [62]

On 12 April 2019, Mr Peter Standen and Mr Tadd Walford of Partridge Structural Pty Ltd (Partridge Structural) inspected the concrete roof of Lot 21 on behalf of the Murrells. [63] Mr Walford is a civil engineer with 14 years’ experience, including in the fields of concrete and steel and the investigation, reporting and remediation of building defects. Mr Walford gave expert evidence in these proceedings, as will be referred to below.

Mr Walford’s evidence is to the effect that the Murrells had engaged Partridge Structural in connection with a proposed development of Lot 21, including the creation of a green roof on the existing concrete roof. The inspection by Mr Standen and Mr Walford on 12 April 2019 was an initial inspection of the condition of the roof for the purpose of discussing the design for the proposed development. Ms Margaret Worth, a design engineer employed by Partridge Structural, was also involved in inspection and investigatory work relating to the roof, although she did not attend the inspection on 12 April 2019.

Mr Walford’s evidence about the purpose of the inspection on 12 April 2019 is consistent with Professor Murrell’s evidence in his affidavit sworn on 7 April 2020, in which he deposed (referring to the period from April to June 2019) that:

On 12 April 2019, Professor Murrell received a further letter from Mr Comino. The letter referred to Professor Murrell’s correspondence of 10 April 2019 and stated: [64]

The letter then sought information about the nature of the works proposed to the roof on Lot 21, the materials, equipment and machinery intended to be brought onto the roof, the period of time over which the works were proposed to be conducted and the frequency of visits to the roof and times of day at which work was proposed to be carried out.

Professor Murrell replied by email on 12 April 2019, stating that he could not provide all of the details requested within the timeframe imposed by Mr Comino’s letter but that he was able to provide the following information: [65]

On 15 April 2019, Mr Comino wrote to Professor Murrell stating that the Owners Corporation remained “greatly concerned” that the works on the concrete roof had already encroached or will encroach on the Airspace. The letter also complained that people had been present on the roof that day “trespassing on our client’s airspace, without first seeking any permission” and asserted that this was “currently a direct and very significant invasion of our residents’ privacy and amenity”. The letter made a further request for detailed information about the work proposed to be carried out to the roof, so that the Owners Corporation could consider whether to grant “limited consent” or whether to commence proceedings in the Supreme Court without further notice. The information requested included details of the “precise length of time” over which the works were proposed to be carried out and a “schedule of the work proposed to be carried out and of the workmen and consultants who are proposed to be requiring access to the roof area”. The letter also asked what the Murrells proposed to do for the protection of the privacy of Unit Owners. [66]

On 18 April 2019, Professor Murrell sent an email to Mr Comino setting out in more detail the works that he intended to carry out to the concrete roof, as already described in his 12 April 2019 email. [67] In relation to the duration of the works, the email stated:

Given that the email had described six stages of work yet to be undertaken on the roof, the effect of this advice was that the work would take approximately six weeks, subject to wet weather delays.

Professor Murrell’s email of 18 April 2019 offered to arrange ways to improve privacy for Unit Owners whilst the works were carried out on the roof. He suggested by way of example that additional scaffolding or fencing could be erected to ensure privacy for Unit 2 whilst the works were carried out, if that were of interest to the Owners Corporation.

Following the initial inspection of the roof by Mr Standen and Mr Walford on 12 April 2019, Slab Scan Pty Ltd (Slab Scan) were engaged in order to ascertain what reinforcement was in the concrete roof so that Partridge Structural could assess whether the roof was strong enough to support a green roof and also whether supports were required for the roof during the development process.

A report prepared by Slab Scan dated 29 April 2019 stated that their investigations indicated that the concrete slab was conventionally reinforced and had a thickness of between 100mm and 120mm. Reinforcement cover varied significantly across the slab, with cover on the underside of the slab generally between 10–15mm and cover on the top side of the slab varying between 10mm and 50mm. [68]

Consultants or contractors engaged by the Murrells accessed the concrete roof on Lot 21 on or about 1, 2 and 3 May 2019, intruding into the Airspace on each occasion. [69]

On 1 May 2019 at 12.16pm, Mr Comino sent a further email to Professor Murrell complaining that there was currently a workman on the concrete roof. The email also stated: [70]

I interrupt the chronology to note that Mr Comino’s email of 1 May 2019 did not acknowledge receipt of Professor Murrell’s email of 18 April 2019, in which Professor Murrell had provided a six week estimate for the duration of the works on the roof in response to Mr Comino’s request in his letter dated 15 April 2019 for details of the “precise length of time” over which the works were proposed to be carried out. Predicting the duration of building works is never an exercise in precision, given the need to co-ordinate different trades to carry out the work in stages in the order necessary to achieve the desired end result. In addition, the roof works were clearly liable to be delayed by wet weather. It is difficult to see how Professor Murrell could provide an estimate with greater precision than the estimate in his 18 April 2019 email of 6 weeks, subject to rain delays. The request on 1 May 2019 for “specific dates and timespans” was plainly unrealistic, in my opinion.

On 2 May 2019, Mr Comino wrote to Professor Murrell complaining again about the alleged lack of satisfactory response to his letter of 15 April 2019. [71] Again, Mr Comino failed to acknowledge Professor Murrell’s email of 18 April 2019. The letter reiterated that Professor Murrell had not sought, and did not have, permission for persons working on his behalf to enter the Airspace above the concrete roof. The letter made it clear that no such consent would be granted by the Owners Corporation unless and until the Murrells answered the specific asked in the previous correspondence, and the Owners Corporation considered those answers. As I have already indicated above, it is in my opinion that the Owners Corporation was demanding an unrealistic level of precision in the information requested, meaning that the prospect of the Owners Corporation consenting to access to the roof was also unrealistic by this time. In Mr Comino’s letter of 2 May 2019, the Owners Corporation added to its previous demands by stating that:

Finally, Mr Comino’s letter of 2 May 2019 again sought the Murrells’ written undertaking that they and their contractors, builders or workmen would not trespass into the Airspace “until our client’s concerns are properly addressed”.

On 6 May 2019, Professor Murrell replied to Mr Comino’s letter of 2 May 2019. [72] Professor Murrell referred Mr Comino to the information that he had already provided in his email of 18 April 2019. He also informed Mr Comino that, following rain the previous weekend, there were two areas where water was coming through the concrete roof and damaging the ceiling. Professor Murrell attached photographs. The letter continued:

In relation to Professor Murrell’s letter of 6 May 2019, Mr Howse said in his affidavit sworn on 6 February 2020: [73]

Mr Comino replied by letter dated 8 May 2019. [74] The letter again complained that the Murrells had failed to provide the specific information previously requested, including in relation to “times, dates etc regarding access by your contractors and builders”. The letter acknowledged that part of the works that the Murrells wished to undertake were repairs to the concrete roof. However, the letter stated that the works described in the Murrells’ previous correspondence – the installation of an upturned lip around the perimeter of the roof and placing pebbles across the whole roof area – went beyond repairs and would extend into the Airspace and “to that extent, is prohibited”.

I note that the upturned lip described in Professor Murrell’s email of 12 April 2019 was 150mm, which would result in it intruding into the Airspace by up to 4mm at certain places but being within the height boundary of Lot 21 at other places. It is this intrusion that the Owners Corporation communicated was prohibited in Mr Comino’s letter of 8 May 2019: see [21] and [204] above.

Mr Comino’s letter of 8 May 2019 concluded by indicating that the Owners Corporation was only prepared to discuss access on the condition that the Murrells provided the specific information previously requested and paid the Owners Corporation’s costs said to have been incurred in connection with “this issue of unauthorised works, trespass and access”. The letter stated that those costs were in the process of being quantified.

I interpolate to note that these conditions on any discussion about access were imposed notwithstanding that the Owners Corporation recognised that the reason for access included the need for repair works.

The pattern of the correspondence by this stage was that the Owners Corporation was countering each round of information provided by Professor Murrell with a demand for further detail and/or the imposition of additional conditions that the Murrells would have to agree to before the Owners Corporation would even consider granting permission for them to enter into the Airspace for the purpose of accessing their roof. As I have indicated above, the level of precision of information demanded by the Owners Corporation had reached an unrealistic level by 1 May 2019. As is clear from Mr Howse’s evidence referred to in [217] above, the Owners Corporation chose to interpret the Murrells failure to comply with its unrealistic demands for information as a failure on the part of the Murrells to make a genuine attempt to resolve matters.

This interpretation was consistent with the unwavering attitude of Mr Howse and the Owners Corporation at all times from the commencement of discussions in November 2018, namely that the Murrells were not to be trusted and that the Murrells were not entitled to undertake any repairs, maintenance or improvements to the concrete roof which required access to the Airspace above RL 26.00 AHD, unless Professor Murrell successfully applied for access under the Access to Neighbouring Land Act or the Murrells obtained the Owners Corporation’s permission to undertake emergency repairs to protect their property from risk of damage by fire, rain or storm. In the emergency scenario, however, the Owners Corporation would require information. [75] In my opinion, it is plain from the pattern of correspondence that I have set out above (which continued, as will become apparent below) that the level of information required by the Owners Corporation would thwart the Murrells from averting any risk posed by an emergency situation. It is clear from the evidence that the predicament that this placed the Murrells in was a source of amusement for Mr Howse, [76] and that the Owners Corporation was determined not to grant consent or an easement (when an easement was later sought) due to what Mr Howse described as “the track record of Mr Murrell”. [77]

I understand Mr Howse’s reference to the “track record” to be a reference to the manner in which the Murrells carried out the development of their property at 40 Fitzwilliam Road, Vaucluse (which adjoins Lot 21). The Owners Corporation strenuously objected to development consent being granted for the development, and once consent was granted, alleged numerous breaches by the Murrells of the terms and conditions of the development consent. Land and Environment Court proceedings followed, the outcome of which was that the court “basically upheld what [the Murrells] wanted to do”. [78]

During the course of the development of 40 Fitzwilliam Road, Mr Howse was interviewed by police in September 2016 concerning an allegation of malicious damage to property after he removed certain formwork that he considered was protruding from 40 Fitzwilliam Road on to the Owners Corporation’s property by 5cm. Concrete had been due to be poured into the formwork the following day. Mr Howse was not charged with any offence. [79]

It was in the context of that history of neighbourly relations that the discussions between the Owners Corporation and the Murrells concerning access to the concrete roof began in November 2018, with the Owners Corporation having already formed a view that the Murrells were not to be trusted.

Professor Murrell’s correspondence from November 2018 onwards steadfastly ignored the Owners Corporation’s complaints that the workmen’s entry onto the roof involved a trespass into the Airspace. As will become apparent below, the Murrells did not take action to prevent their contractors and consultants from entering into the Airspace until after the Owners Corporation proceeding was commenced on 28 June 2019, and did not seek the Owners Corporation’s consent for entry into the Airspace until 8 November 2019.

In cross-examination, Professor Murrell steadfastly maintained that he had not sought the Owners Corporation’s consent and did not believe he was trespassing because he had received legal advice in about November 2018 to the effect that it was lawful for him to effect repairs and maintenance or improvements on the concrete roof. [80]

I reject that evidence given by Professor Murrell. If he had received such legal advice, it is to be expected that he would have referred to it in his correspondence with the Owners Corporation. In cross-examination, he sought to explain his failure to refer to it in his November 2018 correspondence by saying that he believed that “further communications with the Owners Corporation would serve no purpose”. [81] However, the fact is that Professor Murrell did continue his communications with the Owners Corporation after November 2018. Letters or emails were exchanged between them on a regular basis until July 2019.

Moreover, Professor Murrell’s letter of 6 May 2019 did set out the substance of the legal advice (or, at least, his understanding of the advice) that he had received at that time. Professor Murrell claimed to have been advised that it was open to him to make an application to a court “to ensure access for this purpose”. He did not claim to have been advised that he had any legal right to enter the Airspace without first applying to a court.

This contemporaneous account given by Professor Murrell on 6 May 2019 of the legal advice he had received is more reliable than his evidence given one year later during the hearing.

I also note that, when the Murrells sought advice from their solicitor on 21 July 2019 concerning whether they were required to obtain written consent of the Owners Corporation to allow access to the Airspace to construct the proposed green roof, their solicitors did not advise that consent was not required. [82]

I find that the Murrells’ conduct in continuing to cause or permit their contractors and consultants to enter the Airspace during the period from November 2018 to June 2019 was not informed by any legal advice that they had received at that time. Rather, it reflected their frustration at what they saw as the Owners Corporation’s constant objections to what they considered to be minor works of a nature similar to work that had been carried out on the roof by previous owners in the past, and the Owners Corporation’s refusal to be satisfied with any level of information that the Murrells provided about the work. As Professor Murrell said in cross-examination: [83]

On 9 May 2019, Professor Murrell replied to Mr Comino’s letter of 8 May 2019 in the following terms: [84]

Professor Murrell received no response to his letter of 9 May 2019, despite sending a follow up email on 15 May 2019.

On about 17 May 2019, Professor Murrell noticed that the ceiling beneath the concrete roof that had been damaged by water ingress earlier in May had deteriorated further. [85] On 27 May 2019, Professor Murrell wrote to Mr Comino advising him of this further damage and stating that: [86]

Consultants or contractors engaged by the Murrells accessed the concrete roof of 97 Wentworth Road on or about 28, 29 and 30 May 2019, intruding into the Airspace on each occasion. [87]

On 4 June 2019, Mr Comino replied to Professor Murrell’s letter of 27 May 2019. [88] Mr Comino’s letter reiterated several times that the Murrells had not provided specific answers in the specific form previously required by the Owners Corporation, disputed that the work being undertaken on the roof was for the purpose of the repairs described in Professor Murrell’s most recent correspondence and stated that Professor Murrell’s conduct in causing or allowing his contractors to trespass into the Airspace on several occasions “has created serious distrust as to your motives”. The letter referred to the estimate of the Owners Corporation’s costs as still being finalised. The letter set out a further list of demands that the Owners Corporation required to be met in order to “properly consider your request for access for the carrying out of remedial work to the roof on 97 Wentworth Road”, including:

I note that the effect of this letter was that the Owners Corporation withdrew its previous acknowledgement (in Mr Comino’s 8 May 2019 letter) that part of the work that the Murrells sought to undertake on the roof involved repair works, required detailed plans for all of the work that the Murrells were proposing or considering carrying out on the concrete roof before it would even consider consenting to access, and was asserting that the Murrells did not have a right to access the roof for any purpose whatsoever. No explanation was given for the assertion that that the works did not involve repairs, when the Owners Corporation had previously acknowledged that part of the work did involve repairs. In my opinion, it was abundantly clear from this letter, together with the prior correspondence to which I have referred above, that a detailed, time consuming and cumbersome process was involved in having the Owners Corporation even consider a request for consent to access the roof and enter the Airspace, irrespective of the purpose for which access was sought.

I also note that the distrust referred to in Mr Comino’s letter of 4 June 2019 is consistent with sentiments expressed in an email from Mr Howse dated 29 May 2019 to an officer Woollahra Council, in which Mr Howse called on the Council to “put a stop work order on this site” and stated that “Mr Murrell can not [sic] be trusted”. [89]

On 5 June 2019, Professor Murrell wrote to Mr Comino in response to his 4 June 2019 letter. [90] Professor Murrell reiterated that the concrete roof was leaking and that he sought to prevent further water damage. He offered to meet with Mr Comino and representatives of the Owners Corporation together with his architect to show them the three options under consideration for the final surface material to be applied to the roof after waterproofing. He advised that he had engaged surveyors to assist with the roof repairs, and offered to provide documentation by them, once completed, to demonstrate that the completed works were below RL 26.00 AHD. Professor Murrell stated:

Consultants or contractors engaged by the Murrells entered the Airspace on 11, 13 and 27 June 2019. [91]

On 28 June 2019, Mr Comino wrote to Mr Murrell stating that he had continued to trespass into the Owners Corporation’s property, and serving him with the summons filed that day (commencing the Owners Corporation proceeding) and an affidavit of Mr Howse sworn on 13 June 2019. [92]

On 3 July 2019, Mr Jason Hones of Hones Lawyers (solicitors acting for the Murrells) wrote to Mr Comino [93] stating that, from a review of the correspondence and the summons, it appeared that the Owners Corporation accepted that emergency work can be carried out by the Murrells notwithstanding that this would “impinge upon” the Airspace and the Owners Corporation wishes to know what emergency works are to be undertaken. The letter requested confirmation that Mr Hones’ understanding accords with the Owners Corporation’s position. The letter stated that the Murrells had instructed their workers and consultants not to access the roof until further notice (except for the purpose of removing tools) and continued:

Ms Worth of Partridge Structural prepared a report addressed to the Murrells’ architects and dated 4 July 2019. [94] Ms Worth referred to the Slab Scan report of 29 April 2019. Ms Worth’s report noted that a minimum cover of 45mm to all external reinforcing bars would be recommended for an exposed concrete slab in a coastal exposure zone to achieve a 50 year design life, whereas Slab Scan had identified that external cover varied from 50mm down to only 10mm.

Ms Worth’s report also stated that there were visual signs of corrosion to some of the exposed reinforcing bars and that, due to the age of the slab and insufficient cover to the bars, it was to be expected that there is further corrosion not yet visible. Failure of the roof slab due to corrosion of reinforcing would likely be a brittle failure, and would therefore be a sudden collapse of the roof into areas below.

Ms Worth’s report recommended that certain investigative works be undertaken urgently to confirm the extent of the corrosion and adequacy of the slab, and to reduce the risk of the slab collapsing. The report described these works as repairs that were critical to the structural integrity of the roof and that should be undertaken as soon as possible to avoid further loss of integrity and associated increase in remediation costs.

On 4 July 2019, Mr Comino replied to Hones Lawyers’ letter dated 3 July 2019. [95] Mr Comino wrote:

Mr Comino’s letter requested “sufficient information so as to satisfy our clients and this firm why the proposed work is emergency work”, clarification of the Murrells’ intentions concerning the removal of scaffolding and pipes that were said to be trespassing into the Airspace, and a response to the Owners Corporation’s concerns that the Murrells “may be delaying the roofing work due to a pending DA seeking to construct additional rooms at No 97 which will require access to our client’s airspace and that your clients may well be proposing to gain access to our client’s airspace in order to construct those new structures”.

I note that the last mentioned concerns had not been raised in previous correspondence. However, the Owners Corporation did have some basis for apprehending that the Murrells were planning additional development work. As referred to above, development work had been in contemplation when Mr Standen and Mr Walford of Partridge Structural conducted their initial inspection of the concrete roof on 12 April 2019. On 4 August 2019, a building certifier issued a complying development certificate (or CDC) to the Murrells for a development on Lot 21. In so far as it concerned the roof, the complying development involved the installation of a green or gravel surface on the existing concrete roof below the height of RL 26.00 AHD. The CDC stated that the Owners Corporation’s approval would be required for workers to access the roof for the purpose of that part of the development work. [96] In addition, Woollahra Council issued development consent for a development application relating to Lot 21 on 8 November 2019. [97] However, this approval related to specific works within the dwelling and did not directly concern the concrete roof. There was no evidence to suggest that those works were likely to require access to the Airspace.

The dispute in Mr Comino’s 4 July 2019 letter about whether the immediate need to access the roof related to “emergency work” or “repairs” had been raised in previous correspondence. As referred to above, Professor Murrell had provided information about leaks that occurred through the concrete roof, and resulting ceiling damage on 6 May and 27 May 2019, including photographic evidence of the damage. In my opinion, it was reasonably clear from the tone and contents of the correspondence emanating from Mr Comino by 4 July 2019 that no amount of information would satisfy the Owners Corporation that the works, or even part of the works, were intended to prevent further leaks and water damage.

On 19 July 2019, Mr Geoff French of My Building Certifier Pty Ltd wrote to the Murrells advising that their application for a complying development certificate had been registered and neighbours had been notified. The letter set out a list of arrangements that the Murrells would need to make prior to the issue of the certificate, including: [98]

On 22 July 2019, Mr Hones of Hones Lawyers sent a letter to the Murrells in the following terms: [99]

I interpolate to note that the final paragraph of the letter quoted above leaves unanswered the very question posed in the first paragraph of the quote. I infer that the Murrells’ failure to obtain a legal opinion confirming that the Owners Corporation’s consent was not required is the reason why the CDC stated that the Owners Corporation’s approval would be required for workers to access the concrete roof for the purpose of that part of the development work. [100]

The Murrells advised the Owners Corporation of their plans to create a “green roof” garden on or about 25 July 2019, before the CDC was issued on 4 August 2019. [101]

The Murrell proceeding was commenced on 25 September 2019.

Mr Walford of Partridge Structural prepared a report addressed to the Murrells’ architects and dated 29 October 2019. [102] The report provided an update on the condition of the concrete roof. The report noted that no remedial work had been undertaken since Ms Worth’s 4 July 2019 report, but additional propping had been installed in order to assist with reducing the impact of development works on the roof structure. The report reiterated that the exact condition of the slab and extent of corrosion was unknown, such that the slab posed an “unnecessary risk” to those underneath the concrete slab.

In cross-examination, Mr Walford explained the sense in which he used the term “unnecessary risk” in this report and in his expert report prepared for these proceedings dated 24 January 2020. Mr Walford explained that, ordinarily, the integrity of the concrete roof would be fully investigated and any necessary repairs undertaken before development works were carried out underneath the roof. In this case, those investigative and repair works had not been undertaken, and the roof had instead been supporting by propping so that people could work underneath it for the purpose of the development. Whilst this reduced the risk to a sufficient level to permit people to work under the roof, it still involved a higher level of risk than would exist in the ordinary situation where investigative and remedial work was undertaken on the roof prior to work commencing under the roof. In that sense, the risk was “unnecessary”. The propping appeared to be adequate, but he had limited data and information about the roof and “we don’t know what we don’t know”.

Mr Walford’s report dated 29 October 2019 repeated the recommendation in Ms Worth’s 4 July 2019 report that works be undertaken urgently to confirm the extent of the corrosion and adequacy of the slab. As I understand it, the works recommended are substantially the same investigative and repair works recommended in Ms Worth’s report, with the extent of the repair work being dependent on the outcome of the investigative work. Mr Walford reiterated the statement in Ms Worth’s report that these works were critical to the structural integrity of the roof and that should be undertaken as soon as possible to avoid further loss of integrity and associated increase in remediation costs.

On 8 November 2019, Mr Christopher Ters of Hones Lawyers wrote to Mr Comino enclosing a copy of Mr Walford’s report dated 29 October 2019 and a complete copy of the CDC. [103] The letter stated that a copy of Ms Worth’s report dated 4 July 2019 had previously been provided to Mr Comino. The letter requested the Owners Corporation’s consent for the Murrells’ contractors and consultants to enter the Airspace for the purpose of carrying out the urgent investigative and repair works recommended in the Partridge Structural reports dated 4 July and 29 October 2019 (without admitting that such consent was necessary). The letter stated:

The letter requested confirmation with 14 days that the Owners Corporation consented to access to the Airspace for the purpose of those repair works. The letter concluded that, if such consent was not forthcoming, Hones Lawyers anticipated being instructed to file an interlocutory application for urgent orders to facilitate the early performance of those works.

I interpolate to note that Mr Ters’ letter of 8 November 2019 represents the first occasion since they purchased 97 Wentworth Road in November 2018 on which the Murrells had sought the consent of the Owners Corporation before accessing the Airspace. It is clear from Professor Murrell’s affidavit sworn on 7 April 2020 that he was well aware that, on the previous occasions when his contractors had accessed the concrete roof and entered into the Airspace, they had done so without the permission of the Owners Corporation. [104]

On 21 November 2019, Mr Comino replied to Mr Ters’ letter of 8 November 2019, strenuously denying that the Owners Corporation was responsible for any risk to the safety of persons undertaking development work on Lot 21 and maintaining that, if the contentions in the Partridge Structural reports had any substance, then it was the Murrells who were placing the safety of those persons at risk by allowing work to proceed on the site under the allegedly unsafe concrete roof, including the use of jackhammers. [105] The letter stated that it had always been the Owners Corporation’s position that it did not oppose access for the purpose of carrying out emergency works, and continued:

On 26 November 2019, Mr Ters replied to Mr Comino’s letter of 21 November 2019, [106] advising that the Murrells accepted conditions 1, 2 and 4 in the 24 November 2019 letter and requesting details of the further conditions proposed by the Owners Corporation in relation to condition 5. In relation to condition 3, Mr Ters’ letter stated that the works currently being undertaken at 97 Wentworth Road were in accordance with various approvals obtained by the Murrells and “are being undertaken under the supervision and direction of engineers”. In other words, the Murrells did not agree to the Owners Corporation’s condition 3, which would have required them to prevent workmen from accessing some areas of the construction site on Lot 21 pending completion of the work recommended by the Partridge Structural reports.

On 27 November 2019, Mr Comino replied to Mr Ters’ letter of 26 November 2019, stating: [107]

On 29 November 2019, Mr Comino sent a further letter to Mr Ters concerning conditions of access to the Airspace. [108] The letter stated:

The letter then set out the following terms and conditions of the Owners Corporation’s consent to the Murrells accessing the Airspace (in addition to conditions 1 to 4 set out in Mr Comino’s letter of 21 November 2019, which are reproduced [263] above):

I note that the 29 November 2019 letter does not suggest that the matters referred to in conditions 5 and 6 above are necessary to cease or avoid intrusion into the Airspace, and there is no evidence to suggest that this was the case. The Owners Corporation was endeavouring to use the negotiation concerning access to the roof for investigatory and repair work in order to obtain changes to the approved development works being conducted on Lot 21 for the benefit of the Owners Corporation or the owner of Unit 1.

Mr Ters sent an email to Mr Comino on 29 November 2019 asking for clarification of the structural redesign requested in condition 5. [109] Mr Comino replied on 2 December 2019, stating that the “request was to modify the construction so as to preserve some view from unit 1 in our Client’s Strata Scheme”. [110] Mr Ters replied on the same day, asking: “are we to assume that if condition 5 is not accepted by our Clients, namely that our Clients do not agree to redesign their development, that access to the roof space to undertake repairs will not be granted by your client?” [111] Mr Comino replied later that day, stating: “No, that condition will not prevent access to undertake repairs to the roof although the impact will be significant on unit 1.” [112]

On 3 December 2019, Mr Ters wrote to Mr Comino in the following terms: [113]

The area of the proposed easement marked on the attachment to the letter dated 3 December 2019 is the whole of the area of the concrete roof.

Mr Ters’ letter of 3 December 2019 was the first occasion on which the Murrells requested an easement to permit them to enter into the Airspace, although they had sought to enter into an agreement with the Owners Corporation in May and June 2019 to permit them to access the Airspace for the purpose of repairs, maintenance “and the like”, and they had also requested consent to enter the Airspace on 8 November 2019 as referred to above.

On 6 December 2019, Mr Ters wrote a further letter to Mr Comino enclosing a site inspection certificate issued by Partridge Structural on 4 December 2019 which stated, inter alia, that: [114]

Mr Ters’ letter also stated that the Master Builders Association had also inspected, and been satisfied with, the construction site.

On 12 December 2019, Mr Ters sent an email to Mr Comino requesting confirmation that the entirety of the conditions that the Owners Corporation seeks in order to permit the Murrells to access the Airspace are conditions 1 to 4 in Mr Comino’s letter of 29 November 2019 and conditions 1 to 4 in his letter dated 21 November 2019. [115] Mr Ters sent a further email on 17 December 2019 requesting a response to his email of 12 December 2019. [116]

On 18 December 2019, Mr Ters sent a further email to Mr Comino advising that the Murrells’ engineers required access to the Airspace during the first week of January 2020 for the purpose of exploratory work such as half-cell testing of the concrete slab (being work recommended in the Partridge Structural reports of 4 July and 29 October 2019). The precise date and time proposed for the work was to be advised shortly. Mr Ters asked whether, in light of Mr Comino’s correspondence of 26 and 29 November 2019, the Owners Corporation agreed to permit this access to the Airspace. [117]

Despite a follow up email on 13 January 2020, Mr Comino did not respond to Mr Ters’ emails of 12, 17 and 18 December 2019, or to the Murrells’ offer concerning the proposed easement on 3 December 2019. [118] In cross-examination, Mr Howse said that, in December 2019, the Owners Corporation was not prepared to grant the Murrells an easement on any terms. [119]

Mr Walford prepared an expert report dated 24 January 2020, which was annexed to his affidavit sworn for the purpose of these proceedings on 7 February 2020. I assume that it was served on the Owners Corporation on or about 7 February 2020. The expert report states that it is to be read together with the reports prepared by Ms Worth and Mr Walford on 4 July 2019 and 29 October 2019, which had previously been provided to the Owners Corporation as referred to above.

In his expert report, Mr Walford recorded that he had been informed that the neighbours of 97 Wentworth Road had not permitted access to the concrete roof, and that the work recommended in his 28 October 2019 report had therefore not been carried out. He stated that the visible condition of the roof did not appear to have worsened since his inspection on 12 April 2019, but emphasised that he could not give an accurate or definitive assessment of the state of the roof without the recommended investigation works to determine the actual extent of the corrosion damage. He stated that persons below the roof in its present condition were at unnecessary risk (in the sense explained during cross-examination, as referred to above) and that numerous precautions, including propping, had therefore been taken to support the roof during development works until the slab condition can be assessed and any necessary repairs made.

Mr Walford’s report continued: [120]

Mr Walford’s expert report also referred to the likely need to access the concrete roof to carry out repairs in the future due to the possibility that sections not presently in need of repair may suffer corrosion in the future.

Mr Walford’s expertise was not in dispute. It was not put to him in cross-examination that the condition and structural integrity of the concrete roof could be assessed or the extent of necessary remedial works determined without the investigative works that he and Ms Worth had recommended. Nor was it put to him that such investigative works were unlikely to reveal further corrosion or a requirement for remedial works. Nor was it put to him that that propping was unnecessary for the safety persons under the roof, pending those investigative works being carried out and any necessary remedial works being undertaken. Nor was any challenge raised to Mr Walford’s concrete repair methodology, or to his evidence that repair works would need to be carried out from both above and below the concrete slab and that access to the concrete roof above RL 26.00 AHD would be required.

The Owners Corporation did not adduce any expert evidence contradicting Mr Walford’s evidence.

I accept Mr Walford’s evidence.

In closing submissions, the Owners Corporation sought to characterise Mr Walford’s evidence about “unnecessary risk” as referring to more risk than was ideal because work that would eliminate the risk had not been undertaken. I reject this characterisation of Mr Walford’s evidence. The submission downplays the risk in a manner that does not fairly and accurately reflect the substance of Mr Walford’s evidence as a whole. Mr Walford described the approach that would ordinarily be adopted of investigating the structural integrity of the roof and carrying out any necessary remedial work before allowing people to work underneath it, rather than the approach adopted on Lot 21 of allowing them to work under the roof with propping and without investigation or remediation. He referred to the latter approach as involving a higher level of risk than the ordinary situation and therefore unnecessary risk.

The Owners Corporation submitted that:

I reject these submissions.

Mr Walford’s evidence showed that there is visible evidence of corrosion and that it is important to undertake further investigations in order to ascertain the extent of the corrosion, the structural integrity of the roof and whether there was a risk of collapse.

The evidence does not support the Owners Corporation’s contention that the risk of collapse arose only in connection with the development work. On the contrary, Ms Worth’s report stated that it was to be expected that there is further corrosion not yet visible, having regard to the visual signs of corrosion, the age of the slab and insufficient cover to the reinforcing bars (as identified in the Slab Scan investigation). It is in the context of the expected existence of that further corrosion that Ms Worth referred to the risk of brittle failure of the slab due to corrosion, resulting in a sudden collapse of the roof into areas below.

In his expert report, Mr Walford expressed the opinion that “any persons below the roof in its current condition are subject to unnecessary risk”. Propping had been installed for the protection of persons present underneath the roof for the purpose of the development works. In circumstances where no one is living in underneath the roof whilst the development is progressing, [121] it is unsurprising that the safety of workers was the immediate concern and is specifically referred in the reports. However, there is no evidentiary basis for the Owners Corporation’s submission that, but for the development works, persons present underneath the roof would not be at unnecessary risk due to the unknown extent of corrosion.

The Owners Corporation’s submissions emphasised that Mr Walford said in cross-examination that any risks that were present were adequately addressed by the propping up of the roof. Mr Alford did say that the present status quo (i.e. the propping of the roof) was adequate, but the Owners’ Corporation’s submission ignores the qualification that immediately followed that answer: [122]

As is clear from Mr Walford’s expert report, and his earlier report of 29 October 2019 and report of Ms Worth dated 4 July 2019 referred to in his expert report, “what we don’t know” is the condition of reinforcing bars that are concealed within the concrete slab.

The Owners Corporation’s submissions also pointed to Mr Walford’s evidence that there had been no visible change in the condition of the concrete roof between his first inspection on April 2019 and his report dated 23 January 2020. However, this sheds no light on the condition of the reinforcing bars which cannot be seen, and which are the basis for the further investigatory work recommended by Partridge Structural since July 2019.

In his affidavit sworn on 6 February 2020, Mr Howse deposed: [123]

I reject Mr Howse’s characterisation of the Owners Corporation’s conduct. As the chronological account above reveals, by early May 2019, the Owners Corporation was making demands for information in a level of detail and specificity that was plainly unrealistic having regard to the nature of the work involved. The Owners Corporation was insisting that those demands be met before it would even consider permitting the Murrells’ to enter the Airspace for the purpose of undertaking any repair work on their concrete roof. The Owners Corporation maintained this stance, notwithstanding the Murrells’ efforts to provide information and their explanation of the reasons why certain additional information could not be provided. This continued even after the Owners Corporation acknowledged that some of the works that the Murrells wanted to undertake were repairs to the roof. Offers made by Professor Murrell for meetings, including an offer to meet and show the Owners Corporation the options under consideration for the final surface treatment of the roof overlooked by the Unit Owners, were not taken up. As Mr Howse said in cross-examination, the Owners Corporation was not willing to grant an easement to the Murrells on any terms.

As the continuing chronology below reveals, the arrangements that the Owners Corporation considered to be “appropriate” for the Murrells to have access to their roof put very tight constraints on that access that were likely to prove highly problematic over the course of time, and possibly even in the short term future.

On 25 March 2020, Mr Comino wrote to Mr Hones offering to settle the Owners Corporation proceeding on terms that would permit the Murrells to access the Airspace directly over the concrete roof between RL 26.00 AHD and RL 28.00 AHD for the purpose of the Murrells undertaking “necessary works in accordance with the complying development certificate issued on 4 December 2019 … and for your clients and any successors in title to undertake present and future repairs and maintenance of the concrete roof of no. 97 Wentworth Road, Vaucluse” on seventeen terms and conditions to be recorded in a deed, including: [124]

In my opinion, these conditions would have been of concern to any reasonable owner of Lot 21, particularly having regard to the Owners Corporation’s attitude that it had maintained throughout the history of discussions since November 2018. The internal inconsistency within the terms of proposed condition 7 created a fertile ground for dispute about whether repairs and maintenance that were necessary could be undertaken if previous repair and maintenance work had been undertaken less than three months previously. When condition 7 is read together with condition 12, it becomes readily foreseeable that one hour of repair and maintenance work no more frequently than once every three months may very well prove inadequate for a concrete roof constructed in 1960. This is particularly so, bearing in mind the investigative work recommended by Partridge Structural in July and October 2019, which is yet to be undertaken and may identify the need for extensive remedial work to ensure the ongoing structural integrity of the roof. It appears from condition 17 that the Owners Corporation was maintaining the stance it had taken when the Murrells first sought an easement in December 2019, namely that the Owners Corporation would not grant an easement on any terms.

If the Murrells had accepted the Owners’ Corporation’s offer, they would not only have had to accept the risk of the limited rights to access for repairs and maintenance under conditions 7 and 12 proving inadequate, but would also have been promising not to make any future application for an easement under s 88K for any purpose including any extensive repairs that may prove to be necessary or for the purpose any improvements to the concrete roof.

On 24 April 2020, Mr Ters wrote to Mr Comino stating: [125]

Mr Comino replied to this offer on behalf of the Owners Corporation by letter dated 27 April 2020. [126] The letter stated that neither the 3 December 2019 or 24 April 2020 offers constituted reasonable attempts by the Murrells to obtain an easement for the purpose of s 88K(2)(c) of the Conveyancing Act because:

The hearing of these proceedings was conducted on 28, 29 and 30 April and 14 May 2020.

On 29 April 2020, the Murrells made a further offer to the Owners Corporation by letter from Mr Ters to Mr Comino. The offer was in the same terms as the offer made on 24 April 2020, save that the compensation offered was increased to $20,000 and the offer to pay the Owners Corporation’s reasonable legal costs expressly included its costs incurred in connection with the application under s 88K in these proceedings. [127]

It is not in dispute that, during the period relevant to the claim in trespass (November 2018 to June 2019), the Owners Corporation was in exclusive possession of the Airspace. Nor is it in dispute that the Murrells, or contractors acting as their servants or agents, entered the Airspace on multiple occasions during that period without the Owners’ Consent and that these were voluntary acts. Accordingly, the three elements of a cause of action in trespass are established. [128]

The issues raised by the Murrells’ defence of the claim in trespass are: [129]

For the reasons explained under Issue 1 above, the Restriction, properly construed, did not include a covenant permitting the Murrells to enter the Airspace on a temporary or transitory basis in order to repair, maintain and/or improve the roof. (This assumes, in favour of the Murrells, that Owners Corporation’s title to the Airspace remains subject to the Restriction, as to which see Issue 2 above.) The Murrells have therefore failed to establish the first basis of their defence to the claim in trespass.

The Murrells have also failed to establish the second basis of their defence to the claim in trespass. For the reasons explained under Issue 4 above, the Murrells do not have the benefit of an implied easement of necessity that is enforceable against the Owners Corporation.

It remains to consider the third basis of the defence: namely, the defence of necessity.

The Murrells have a defence of necessity to the claim in trespass in respect of their entries into the Airspace only if and to the extent that they entered into the Airspace for the purpose of taking steps that were reasonably necessary to address a situation of immediate danger or imminent peril, and provided that the situation had not arisen as a result of their own negligence. [130]

It is convenient to set out in full what was said by Leeming JA (with the concurrence of Macfarlan JA and Sackville AJA) in Simon v Condran (supra) at [33]–[34]:

In my opinion, it is clear from the evidence summarised in [186]–[303] above that the circumstances in which the Murrells (or their consultants and contractors) entered the Airspace during the period from November 2018 to June 2019 did not involve immediate danger or imminent peril to property or persons in the period until about 3 May 2019. On the contrary, the evidence reveals that entries into the Airspace during that period were for the purpose of:

In relation to the Murrells’ general concerns about the adequacy of the concrete roof to which I have referred above, there is no evidence that any of these concerns were indicative of immediate danger or imminent peril, as opposed to matters that reasonably required investigation in a timely and orderly manner. I note that Professor Murrell says that he had held these concerns since the Murrells purchased Lot 21 in November 2018. However, the first evidence of steps being taken to investigate those concerns is the inspection undertaken by Partridge Structural on 12 April 2019. The five month delay confirms, in my opinion, that these concerns did not indicate any immediate danger or imminent peril of the kind that would give rise to a defence of necessity to the Owners Corporation’s claim in trespass.

However, from about 6 May 2019, there had been damage to a ceiling within the dwelling on Lot 21 as a result of water penetrating the concrete roof and there was an imminent risk of further damage in the event of further wet weather, noting that the timing of wet weather is inherently unpredictable even with the benefit of forecasts. Further damage did in fact occur on or about 17 May 2019.

Contractors or consultants engaged on behalf of the Murrells accessed the concrete roof and entered the Airspace on six occasions after 6 May 2019: on 28, 29 and 30 May and on 11, 13 and 27 June 2019. The evidence does not reveal the purpose for which they accessed the roof on each of those occasions, but I infer that it is likely that at least some of those entries were for the purpose of repairing cracks that were believed to have caused the water damage to the ceiling.

In my opinion, from 6 May 2019, it was reasonably necessary for the Murrells to enter into the Airspace for the purpose of accessing their concrete roof and repairing cracks that were causing water ingress and resulting damage to the interior of their property, having regard to the following matters:

It was put to Professor Murrell in cross-examination that, as at May 2019, the proposed development of Lot 21 involved stripping out the interior of the dwelling and he was therefore unconcerned about any water damage to the ceiling emanating from the concrete roof and the purpose of his contractors accessing the roof in May and June 2019 therefore had nothing to do with repair of cracks. Professor Murrell denied this. I accept his denial. Amongst other things, the Murrells did not have the CDC for the development of Lot 21 until 4 August 2019. They could not have safely assumed in May 2019 that they would be able to proceed with the proposed development (irrespective of whether it was then envisaged to involve the extensive stripping out that has turned out to be the case).

The Owners Corporation submitted that there was “a strong inference” available that the need for repair works to prevent water ingress from 6 May 2019 had been necessitated by the removal of the waterproof membrane covering the roof on 9 April 2019, which had been done without the Owners Corporation’s consent for the Murrells to enter into the Airspace for that purpose. It was submitted that: “There might be a question as to whether work to repair damage caused by the unauthorised works is itself the type of emergency which would be permitted by an application of the doctrine of necessity.” [131] This possible question was not addressed further in submissions, and so it is not necessary to address it in these reasons.

For completeness, I note that the reports prepared by Partridge Structural on 4 July 2019 and 29 October 2019 identified risk of damage to the roof and injury to persons if further investigative work was not undertaken to determine the extent of the corrosion of the reinforcement bars within the roof and to identify the necessary remedial work, followed by completion of that remedial work. However, this risk was identified only after the end of the period in which the Murrells’ entries into the Airspace are the subject of the Owners Corporation’s claim in trespass in these proceedings. Accordingly, that risk is not relevant to the Murrells’ defence of necessity.

For those reasons, I find that:

As will become apparent, it is not material for the purpose of determining the Owners Corporations’ claims for damages, including aggravated and exemplary damages, that the evidence does not enable findings to be made about precisely how many of the six proven entries into the Airspace during the period from 6 May 2019 to 27 June 2019 constituted trespass: see Issue 6 and Issue 7 below.

For the reasons in [144]–[164] above, I have concluded that the Owners Corporation does not have standing to prosecute the claim in nuisance insofar as it relates to entries into the Airspace. However, in case of any appeal, I now explain the findings that I would have made concerning the claim in nuisance if the Owners Corporation had been found to have standing to prosecute that claim.

Assuming (in favour of the Murrells) that Owners Corporation’s title to the Airspace remains subject to the Restriction (as to which see Issue 2 above), the Restriction did not operate to permit the Murrells to enter the Airspace on a temporary or transitory basis in order to repair, maintain and/or improve the roof, for the reasons explained under Issue 1 above.

As I have referred to above, the remaining issue in dispute between the parties in relation to the cause of action in nuisance is whether or not the Murrells’ entries into the Airspace constituted a substantial and unreasonable interference with property rights. Because the alleged interference comprised loss of privacy and loss of amenity of Unit Owners, the relevant property rights are the rights of each Unit Owner to enjoy their Unit together with the Airspace in which they have a beneficial interest. [132]

The High Court held in Elston v Dore (1982) 149 CLR 480 at 488 that the proper test to apply in most cases of private nuisance is that stated by Lord Wright in Sedleigh-Denfield v O’Callaghan [1940] AC 880 at 903:

Ordinarily, it would be a reasonable and convenient use of a person’s land for that person to periodically enter onto the roof of a dwelling constructed on their land in order to repair, maintain and even improve that roof. However, subject to one qualification, the conduct of the Murrells was unreasonable because it involved repeated entries not only onto the roof on land owned by the Murrells but also into Airspace owned by the Owners Corporation without seeking or obtaining the consent of the Owners Corporation. As I have found in [229]–[233] above, the Murrells were not labouring under any erroneous assumption that they had a legal right to behave as they did. Rather, they were acting on the basis that they considered the Owners Corporation’s attitude to be unreasonable. In my view, the Owners Corporation’s attitude was indeed unreasonable by May 2019, for the reasons I have explained in [213]–[223], [239] above. However, that does not make the Murrells’ conduct reasonable.

Whilst a balance must be struck between a land owner’s right to do what it likes with its land and a neighbour’s right not to be interfered with, I do not consider that the balance should be struck in favour of sanctioning as reasonable a land owner using his or her land in a manner that involves repeated entries onto the neighbour’s land without seeking or obtaining the neighbour’s consent.

The qualification mentioned above is that, to the extent that the Murrells’ entries onto the concrete roof between 6 May and 27 June 2019 were for the purpose of repairing cracks in the roof which had caused water leakage and damage to the dwelling on Lot 21, the Murrells’ conduct was not unreasonable for the reasons already addressed in [313] to [317] above.

The question is whether the Murrells’ unreasonable conduct harmed the Unit Owners’ enjoyment of their property rights to a substantial degree. [133]

In Hill v Higgins [2012] NSWSC 270, cited by the Owners Corporation, Harrison J said:

I have found in [165]–[185] above that the interference with use and enjoyment of property was limited to:

The submissions made on behalf of the Owners Corporation failed to grapple with the evidence of the impact of the entries into the Airspace on Unit Owners, on the basis of which the above findings were made, and to address why that evidence supported a finding that entries into the Airspace interfered with Unit Owners’ enjoyment of their property rights to a substantial degree.

Whilst the Murrells’ conduct was unreasonable because it involved trespass, I find that the interference it caused with Unit Owners’ enjoyment of their property rights did not amount to a material interference with the ordinary comfort of human existence in a densely populated suburban area where all human activity on one parcel of land necessarily involves some risk of interference to the occupants of adjoining land and the operation of society depends on a certain level of tolerance of some interference so that all members of the society can carry on with their lives.

If I had found that the Owners Corporation had standing to being the claim in nuisance, I would have dismissed the claim for those reasons.

The Owners Corporation has standing to sue on the cause of action in trespass.

The Murrells’ entries into the Airspace during the period from November 2018 to June 2019 constituted trespass, save to the extent that their entries into the Airspace during the period from 6 May 2019 to 27 June 2019 were for the purpose of repairing cracks in the concrete roof and thereby reducing or avoiding further water damage to the dwelling on Lot 21.

The Owners Corporation does not have standing to sue on the cause of action in nuisance for alleged substantial and unreasonable interference with Unit Owners’ enjoyment of their property rights. The claim in nuisance is therefore dismissed in so far as it is founded on the Murrells’ entries into the Airspace.

The actions of the Murrells in entering into the Airspace did not cause a substantial interference with Unit Owners’ property rights in any event, so the claim in nuisance would have failed even if the Owners Corporation had standing.

In light of my conclusions in relation to Issue 5, it is only necessary to determine compensatory damages for the claim in trespass.

As referred to at [145]–[146] above, the loss and damage particularised by the Owners Corporation as having been suffered as a result of the Murrells’ trespass into the Airspace is loss of amenity and privacy to Unit Owners. The Owners Corporation’s submissions made no attempt to articulate an amount said to be an appropriate quantum of damages by reference to that loss of amenity.

Rather, in closing submissions made on the final day of the hearing, the Owners Corporation submitted that an award of more than nominal damages was appropriate in this case to vindicate the Owners Corporation’s right to exclude others from their Airspace and to reflect the deliberate invasion of their Airspace by the Murrells on multiple occasions. The Owners Corporation referred again to Hill v Higgins (supra), in which Harrison J stated (at [36]) that trespass is actionable without proof of material loss, citing Plenty v Dillon (1991) 171 CLR 635; [1991] HCA 5 per Gaudron and McHugh JJ.

In my opinion, notwithstanding that the facts in Plenty v Dillon (supra) were very different from the facts in the present case, the following passage from the judgment of Gaudron and McHugh JJ apply equally to the question of damages for trespass to the Airspace in this case: [134]

In this case, the loss of amenity caused by the trespasses into the Airspace was trivial, as I have found in [328]–[333] above. However, I reject the Murrells’ submission that the trespass should therefore be characterised as de minimis. [135] The Murrells deliberately entered the Airspace, without seeking the consent of the Owners Corporation and knowing that they did not have that consent. I have found that, at the time, they did not have legal advice suggesting that they had any legal right to enter the Airspace. They entered repeatedly, and must have known that the Owners Corporation could not take physical or practical measures to prevent them from doing so. For the purpose of assessing damages for trespass, it is not to the point that they informed the Owners Corporation about what they were doing, or that the Owners Corporation was acting unreasonably.

In closing submissions, the Owners Corporation asked the Court to do the best it can, assessing the significance of the trespasses having regard to all the evidence. It was submitted that: [136]

I note that the amount of $20,000 was a suggested amount of compensatory damages for trespasses to the Airspace, and also the alleged trespass related to the painting of the Boundary Wall and construction of the stud wall. I am considering here the trespasses to the Airspace only. The alleged trespasses relating to the Boundary Wall and the stud wall are considered under Issues 16 to 19 below.

In my opinion, taking into account all of the circumstances referred to above, and bearing in mind that the trespass is limited to those occasions on which the entries into the Airspace were not for the purpose of repairing cracks in the concrete roof and that the evidence does not clearly establish precisely which of those occasions are therefore excluded from the trespass, the appropriate award of damages to vindicate the Owners Corporation’s property rights is the sum of $10,000.

There will be an award of $10,000 in favour of the Owners Corporation for general damages for the trespasses into its Airspace during the period November 2018 to June 2019.

In light of my conclusions in relation to Issue 5, it is only necessary to determine the claims for aggravated and exemplary damages in relation to the claim in trespass.

The submissions on behalf of the Owners Corporation made no more than passing reference to its claims for aggravated and exemplary damages.

I accept the submission made on behalf of the Murrells that aggravated damages are awarded as additional compensation for injury to a plaintiff’s feelings (such as insult, humiliation) caused by the wrongdoing: Gray v Motor Accidents Commission (1998) 196 CLR 1; [1998] HCA 70 at [6] (Gleeson CJ, McHugh, Gummow and Hayne JJ); R P Balkin and J L R Davis, Law of Torts (supra) at [5.19].

In this case, the impact of the trespasses into the Airspace was felt by Unit Owners rather than the Owners Corporation, and I have found in [328]–[333] above that the impact was trivial. The Owners Corporation itself, being a corporation, did not suffer injured feelings. To the extent that injured feelings suffered by Unit Owners may be considered relevant, I find on the basis of considering as a whole the evidence summarised in [186]–[303] above, that those injured feelings had developed and become entrenched during disputes concerning the development of 40 Fitzwilliam Street, and simply continued to simmer during the dealings between the Owners Corporation and the Murrells concerning the Airspace.

I also accept the Murrells’ submissions that exemplary damages are awarded to express the court’s disapproval of, and to punish, conduct of a defendant who has been guilty of conscious wrongdoing in contumelious disregard of the plaintiff’s rights, and to deter conduct of that nature. The power to award exemplary damages should be used with restraint: Gray v Motor Accidents Commission (supra) at [8]–[20], [25]–[31] (Gleeson CJ, McHugh, Gummow and Hayne JJ)

As I have said above, the Murrells deliberately entered the Airspace repeatedly, without seeking the consent of the Owners Corporation and knowing that they did not have that consent. They were not labouring under a misunderstanding that they had a legal right to do so. It is clear from Professor Murrell’s letter of 6 May 2019 that the Murrells were aware that they would need to make an application to a court in order to obtain a right to enter into the Airspace. As I understand the Owners Corporation’s very brief submissions, these are the matters on which it relies in seeking exemplary damages. All of these matters have been taken into account in arriving at the award of general damages above. In my opinion, it would be inappropriate in those circumstances to impose an additional sanction on the Murrells by awarding exemplary damages.

There will be no award for aggravated or exemplary damages in relation to the trespasses into the Owners Corporation’s Airspace during the period November 2018 to July 2019.

I note that the Owners Corporation’s claim for injunctive relief is addressed under Issue 15 below.

The terms of s 89 of the Conveyancing Act are set out in [54] above.

For the reasons explained under Issue 2 above, it is doubtful in my opinion that the Owners Corporation’s registered title to the Airspace is subject to the Restriction. If it is not subject to the Restriction, then there would be no scope for the application of 89. However, for the reasons already explained under Issue 2 above, it is preferable not to decide that question. I will therefore consider the Murrells’ claim for relief under s 89 of the Conveyancing Act on the assumption that the Owners Corporation’s title to the Airspace is subject to the Restriction.

That assumption renders it unnecessary to address the submission made on behalf of the Murrells, rather faintly in oral closing submissions and unsupported by authority or analysis, that Lot 21 is subject to a “restriction” within the meaning of s 89(1) by reason of the Owners Corporation’s ownership of the Airspace (relying on the words “or otherwise” in the chapeau to s 89(1)), and that s 89(1) therefore applies if the requirements of s 89(1)(a) or (c) are satisfied. (The Murrells did not rely on s 89(1)(b) or (b1).) A further reason for disregarding that submission is that it is irrelevant to the Murrells’ pleaded claim for relief, which was for an order under s 89 modifying the registered s 88B instrument defined in the Murrells’ pleading as “the Restriction”.

There is another threshold issue that was not addressed by the parties. Research in the course of preparing these reasons [137] identified authority to the effect that, in its application to easements, s 89 of the Conveyancing Act does not confer power on the Court to modify an easement by expanding the rights conferred on the dominant tenement owner or by imposing conditions on the easement for the benefit of the dominant tenement owner: Markos v O R Autor (2007) 13 BPR 24,487; [2007] NSWSC 810 at [108]–[121] and the authorities there referred to.

As this is purely a question of statutory construction that goes to whether or not the Court has the power to grant the relief sought by the Murrells under s 89 of the Conveyancing Act, it is both necessary and appropriate to determine that question.

I respectfully agree with and adopt Austin J’s analysis in Markos v O R Autor (supra) at [108]–[121]. I note that aspects his Honour’s reasoning have been cited with approval and applied in previous judgments of this Court to the extent relevant to the facts of those cases: Tanlane Pty Ltd v Moorebank Recyclers Pty Ltd [2008] NSWSC 1341 at [69]–[87]; Fincob Pty Ltd v Campbelltown City Council [2010] NSWSC 349 at [50]–[60].

For the purpose of their claim for relief under s 89 of the Conveyancing Act, the Murrells seek to cast themselves as the owners of land that is burdened by the Restriction – that is, as servient tenement owners. The modification that the Murrells seek under s 89 is:

The Murrells’ claim to modify the Restriction is in truth a claim for an easement. This is particularly so, given that the Restriction had no meaningful or practical work to do after the Airspace plan of subdivision was registered (see Issue 2 above). The Murrells are putative dominant tenement owners. In my opinion, the power conferred on the Court by s 89(1)(a) and s 89(1)(c) does not extend to the making of orders creating easements for the same reason that Austin J held it did not extend to expanding or adding to rights conferred on dominant tenement owners by existing easements in Markos v O R Autor (supra).

For those reasons, it is my opinion that the relief sought by the Murrells under s 89(1) of the Conveyancing Act falls outside the power conferred on the Court under that section. The Murrells claim for relief under s 89(1) is therefore dismissed.

As I have already referred to earlier in these reasons, the terms of the order sought by the Murrells under s 88K in the summons and statement of claim filed on 25 September 2019 and 25 November 2019 respectively are an easement to permit:

Late in the afternoon on the final day of the hearing, the Murrells applied for leave to amend their pleadings to seek an easement under s 88K to permit:

Given the timing of the amendment application, the Murrells’ submissions in support of the application and the Owners Corporation’s submissions opposing the proposed amendment were made in writing following the conclusion of the hearing and the Court’s decision in respect of the amendment application was reserved to be delivered at the same time as judgment in the proceedings.

The exercise of the discretion to grant leave falls to be exercised in a manner that gives effect to the overriding purpose of facilitating the just, quick and cheap resolution of the real issues in the proceedings and the dictates of justice: Civil Procedure Act 2005 (NSW), ss 56–58.

The Murrells accepted that the application for leave to amend was made very late and that they had simply overlooked making the amendment application earlier. They submitted that leave to amend should be granted for two reasons. [138]

First, the Murrells submitted that the proposed additional words – “on a temporary basis” – were already implicit in the terms of the order sought in prayer 4 of the summons and statement of claim, particularly having regard to the words “as reasonably necessary” in the terms of that proposed order.

Second, the Murrells submitted that there was no demonstrable prejudice to the Owners Corporation from the addition of those words, which were merely clarifying words of limitation. In particular, the additional words could not conceivably affect the valuation evidence adduced by the parties in relation to compensation for the purpose of s 88K.

The Owners Corporation submitted that leave to amend should be refused for two reasons. [139]

First, the Murrells had taken to trial a claim for an easement under s 88K giving them “a general right to enter the Airspace as needed for the purpose of the proposed easement”, and the proposed amendment making it clear that the Murrells required no more than a temporary right to enter the Airspace was a material departure from the case taken to trial.

Second, the Owners Corporation submitted that it would be prejudiced if the Murrells were now permitted to depart from their case at trial by amending in the manner proposed. The prejudice was said to arise from the fact that the evidence of the expert valuer called by the Owners Corporation (Mr Donovan) had been based on the wording of the proposed easement in the summons and statement of claim as filed in the Murrell proceeding. It was submitted that, on the basis of that wording, Mr Donovan considered that the proposed easement gave rise to the potential for an intensification of the roof use that would, in turn, lead to a diminution in market value of the Units. It was submitted that, if leave to amend were granted, the Owners Corporation would be left with “no evidentiary foundation” in relation to compensation for the purpose of s 88K.

I accept the Murrells’ submission that the proposed additional words – “on a temporary basis” – were already implicit in the terms of the order sought in prayer 4 of the summons and statement of claim filed in the Murrell proceedings. I reject the Owners Corporation’s submissions that the proposed amendment materially alters the case that the Murrells took to trial.

It is clear from the terms of prayer 4 of the statement of claim as filed, particularly when read together with paragraph 17, that the easement is sought for the purpose of repair and maintenance of, and improvements to, structures on Lot 21 below the height of RL AHD 26.00 AHD. The need for access to the Airspace for the purpose of effecting such repairs, maintenance and improvements cannot reasonably have been understood to represent a permanent state of affairs. The terms of the proposed easement, in the form originally pleaded, do give rise to a question about how frequently it is “reasonably necessary” to access the Airspace for the specified purposes. The proposed amendment does not remove or alter that issue, in my opinion.

It is the prospect of frequent temporary access for the specified purposes that formed the basis of the opinions expressed by Mr Donovan, on which the Owners Corporation relies, as to the effect of the proposed easement on the market value of the Units. Mr Donovan’s report refers to “the potential for an intensifying use of the adjacent roof space in an uncontrolled manner for ‘maintenance’ and other such words” as being “of great concern” due to the impact of people standing on or traversing across the roof (that is, temporary presence of persons on the roof) on views, security and privacy enjoyed from the Units, and the importance of harbour views, and security and privacy considerations to potential purchases in the market for the Units. [140]

For those reasons, I also reject the Owners Corporation’s submission that it will be prejudiced if the proposed amendment is allowed because Mr Donovan’s report will become irrelevant on the question of compensation under s 88K. As will become apparent, Mr Donovan’s report is indeed irrelevant in relation to the question of compensation under s 88K, but that is for reasons unrelated to the amendment because the Owners Corporation is the only person required by s 88K(2)(b) to be adequately compensated for any loss or other disadvantage that will arise from the imposition of proposed easement (see Issue 12 below). Mr Donovan’s report is limited to compensation to Unit Owners.

Ordinarily, delay in seeking to amend until the last day of the hearing, with no explanation other than inadvertence on the part of the party seeking to amend or its legal representatives, would be likely to count heavily against the grant of leave to amend: Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175; [2009] HCA 27 at [24] (French CJ), [97]–[98] and [102]–[103] (Gummow, Hayne, Crennan, Kiefel and Bell JJ). However, I do not consider the delay to be of material significance in circumstances where the proposed amendment is merely clarifying a matter that was already implicit in the terms of the proposed easement set out in the Murrells’ pleadings and would not affect the manner in which the parties conducted the case.

Taking into account the delay together with all of the other factors referred to above, I consider that it is consistent with the overriding purpose and the dictates of justice to grant leave to amend in the circumstances of this case.

Accordingly, the Murrells are granted leave to amend prayer 4 in their summons filed on 25 September 2019 and prayer 4 in their statement of claim filed on 25 November 2019 to read:

For all of the reasons already referred to above, it seems to me to be unlikely that this amendment will cause any costs incurred by the Owners Corporation to have been thrown away. However, there is no reason why the Owners Corporation should not have the benefit of the usual order that the Murrells pay its costs thrown away (if any) by reason of the amendment.

The terms of the proposed easement (as amended) limit the circumstances in which the owners of Part Lot 21 are permitted to enter the Airspace to when it is “reasonably necessary” to do so to “repair, maintain and/or improve any structures on Part Lot 21”. It is clear from the syntax (particularly after the amendment) that the requirement for reasonable necessity applies not to the repairs, maintenance or improvement, but to the access to the Airspace for the purpose of carrying out the repairs, maintenance or improvements.

The terms of the proposed easement (as amended) also limit the duration of entries to the Airspace for the permitted purposes (“on a temporary basis”).

Insofar as it would permit access to the Airspace for the purpose of improvements, the proposed easement is not limited to any specific improvements and would apply to any and all future improvements, provided that it is reasonably necessary for the owners of Part Lot 21 to access the Airspace for the purpose of undertaking those improvements. The terms of the proposed easement are not even limited to lawful improvements.

The terms of the proposed easement plainly do not permit any improvements themselves to intrude into the Airspace.

The terms of the proposed easement do not provide for any tools, equipment or machinery associated with repairs, maintenance or improvements to be taken onto or remain in the Airspace, even on a temporary basis. The proposed right to access the Airspace is limited to the owners of Part Lot 21 (which would, of course, include their servants, agents and contractors). The Murrells have not expressly referred to the taking of tools, equipment or machinery into the Airspace. Nor have they employed the expression “easement for repairs”, which would have attracted the operation of s 181(A)(2) and Part 5 of Schedule 8 of the Conveyancing Act.

However, it is absurd to think that repairs, maintenance or improvements could be carried out on structures on Part Lot 21 without the use of tools, equipment and machinery. The case was conducted on the assumption that, if the proposed easement was granted, this would permit the owners of Part Lot 21 to use tools, equipment and machinery on the concrete roof of the existing residence. The adverse impact on Unit Owners of noise emanating from the use of such tools, equipment and machinery was one of the grounds on which the Owners Corporation strenuously objected to the Murrells’ application under s 88K. [141]

Whilst it is regrettable that the Murrells have failed to attend to this detail in drafting the proposed easement, [142] I consider that it is consistent with the manner in which the case was run by both parties at trial to proceed on the basis that the Murrells apply for an easement under s 88K in the following terms:

The additional words concerning taking things onto the servient tenement reflect clause 1(b) of Part 5 of Schedule 8 to the Conveyancing Act.

The question arising under s 88K(1) is whether an easement in those terms is “reasonably necessary for the effective use or development of the dominant tenement”.

There was no dispute between the parties as to the applicable principles, which are conveniently set out in Gordon v Lever (No 2) (2019) 101 NSWLR 427; [2019] NSWCA 275 at [35]–[42] (Bell P, Payne JA, Emmett AJA agreeing). At [38], Bell P referred to the following passage of the judgment of Bathurst CJ, Beazley and Meagher JJA in Moorebank Recyclers Pty Ltd v Tanlane Pty Ltd (2012) 16 BPR 31,257; [2012] NSWCA 445 at [154]:

The President also noted (at [39]) the following observations of Darke J in Govindan-Lee v Sawkins (2016) 18 BPR 35,883; [2016] NSWSC 328 at [49]:

The President continued (at [40]–[42]):

In my opinion, the proposed easement is reasonably necessary for the effective use or development of Part Lot 21 to the extent that it permits access to the Airspace as necessary and on a temporary basis to repair and maintain structures on Part Lot 21. To the extent that the proposed easement would permit access to the Airspace for the purpose of improvements, or in circumstances where access is “reasonably necessary” rather than a matter of absolute necessity, the Murrells have not established that the proposed easement is reasonably necessary for the effective use or development of Part Lot 21. My reasons for those opinions are as follows.

First, as submitted by the Murrells, Part Lot 21 is zoned R2 pursuant to the Woollarah Local Environment Plan 2014 (NSW) and the use of that land as a residential dwelling is permissible with consent in that zone. [143] There is an existing residential dwelling on Part Lot 21. That dwelling has existed on that land since approximately the 1960’s, although it has recently undergone extensive renovation.

Second, I accept the Murrells’ submission that it is not possible to carry out repairs and maintenance to the flat concrete roof of that dwelling without intruding into the Airspace, given that there is only between 11cm and 16cm between the flat concrete roof and the lower boundary of the Airspace. That is to say, access to the Airspace is absolutely necessary (not merely “reasonably necessary”) in order to carry out any repair or maintenance of the concrete roof. The evidence of Mr Walford provides some indication of the nature of the problems and risks that are inherently likely to arise over time if it is impossible to carry out repairs and maintenance to the concrete roof: see [245]–[247], [257]–[259], [278]–[293] above.

The Owners Corporation did not dispute that it was necessary for the Murrells to access the Airspace in order to repair and maintain the concrete roof. However, the Owners Corporation submitted that an easement is not reasonably necessary because the Murrells:

I reject these submissions.

As identified in the Murrells’ submissions, an application under the Access to Neighbouring Land Act would require the Murrells to make a separate application on each occasion when they wished to carry out repair and maintenance work, giving 21 days’ notice to Owners Corporation prior to lodging each such application. This is a cumbersome and inefficient regime for ongoing repair and maintenance of a residential dwelling, in my opinion. The legislation is plainly better suited to resolving an impasse between adjacent land owners relating to works of a one-off nature.

Even if I am wrong about the operation of the Access to Neighbouring Land Act and a single application could be made to cover all future repairs and maintenance work, an order imposing an easement in this proceeding is a superior option to the alternative of a further proceeding under the Access to Neighbouring Land Act. [144]

It is highly undesirable, in my opinion, that any landowner should be constrained to rely on a defence of necessity to a claim in trespass once repairs or maintenance have become necessary to avert imminent danger as because the owner has had no lawful authority to conduct ongoing maintenance repairs to the dwelling on their land in a timely manner so as to avoid the danger arising in the first place.

All of the evidence and both parties’ submissions were directed to the impossibility of repairing and maintaining (and improving) the flat concrete roof on Part Lot 21 without entering into the Airspace in order to carry out the work, and whether this justified the conclusion that the proposed easement was reasonably necessary for the effective use or development of Part Lot 21.

Notwithstanding this, the proposed easement has been drafted in terms that would permit access to the Airspace that is “reasonably necessary” (as opposed to “necessary”) to repair, maintain and/or improve “structures” (not limited to the concrete roof) on Part Lot 21.

The expression “reasonably necessary” conveys something less than absolute necessity, and calls for an assessment of all of the circumstances relevant to the particular repairs, maintenance or improvements to be carried out against the criterion of reasonableness. [145] For example, it would be necessary to consider the nature of the work involved and the degree of difficulty, cost and risk of carrying out that work with or without entering the Airspace, in order to ascertain whether the proposed easement permitted access to the Airspace to undertake that particular work. Reasonable minds may differ about the outcome of such an assessment, particularly in circumstances where the dominant tenement owner approaches the assessment from the perspective of their need or desire to undertake the work and the servient tenement owner approaches the assessment from perspective of a desire to minimise entries into its Airspace. The access criterion of “reasonable necessity” lays the seeds for disputes between the Murrells and the Owners Corporation, or their respective successors in title, concerning the applicability of the easement in particular circumstances that arise in the future.

As I have said above, all the Murrells’ evidence and submissions were directed to need for the easement due to the impossibility of repairing and maintaining (and improving) the flat concrete roof on Part Lot 21 without entering into the Airspace. The Murrells have failed to establish that the proposed easement is reasonably necessary for the effective use or development of Part Lot 21 to the extent that it would permit them to enter into the Airspace in circumstances where it was not absolutely necessary to do so in order to repair or maintain structures on Part Lot 21. For separate reasons that I explain below, the Murrells have also failed to establish the reasonable necessity of the proposed easement insofar as it relates to access to the Airspace for the purpose of improvements.

Third, the proposed easement, to the extent that it permits access necessary for repairs and maintenance, would have no impact on the Owners Corporation.

Assuming (without deciding) that it is relevant for the purpose of s 88K(1) to consider the impact on Unit Owners, that impact will be limited to temporary potential noise disturbance, reduction of privacy and interference with (but not obstruction of) harbour views during repair and maintenance work. For the reasons in [330]–[332] above, I reject the Owners Corporation’s submission that this constitutes a “significant imposition” on the privacy and amenity of Unit Owners.

Having regard to all of those matters, I consider that the use of Part Lot 21 for the permitted and reasonable use of a residential dwelling with an easement to access the Airspace, as necessary and on a temporary basis, to repair and maintain structures on Part Lot 21, is substantially preferable to the use of that land for that purpose without the benefit of such an easement.

However, the Murrells have not discharged their onus of demonstrating the reasonable necessity of the proposed easement insofar as it relates to improvements. Whether or not the test of reasonable necessity would be satisfied in relation to “improvements” would vary from one improvement to the next depending on the nature of the improvement, the work required to give effect to it, whether there are means of carrying out the improvement without access to the Airspace and whether the improvement was a reasonable use or development of Part Lot 21. The Murrells have chosen to make an application under s 88K for an easement granting rights of access to the Airspace as reasonably necessary and on a temporary basis for the purpose of making unspecified “improvements” to the structures on Part Lot 21. To that extent, the application under s 88K fails at the first hurdle of s 88K(1).

For all of those reasons, I have concluded that an easement in terms to the following effect is reasonably necessary for the effective use or development of Lot 21:

The Owners Corporation submitted that, having regard to the loss of amenity and privacy for Unit Owners that would result from the granting of the proposed easement, and alternative rights of entry into the Airspace (that is, rights under the Access to Neighbouring Land Act and/or the defence of necessity), the Murrells have failed to establish that the use of Part Lot 21 with the benefit of the proposed easement is not inconsistent with the public interest. To the extent that the proposed easement is for access to the Airspace as necessary and on a temporary basis to repair and maintain the structures on Part Lot 21, I reject that submission for all of the reasons already explained under Issue 10 above.

The proposed easement cannot be granted unless the Court is satisfied that:

There is no dispute that the Owners Corporation is the owner of the Airspace and that it is necessary for the Court to be satisfied that the Owners Corporation can be adequately compensated for any loss or other disadvantage that will arise from the proposed easement. The question of compensation for the Owners Corporation is addressed below.

As I understood the submissions made on behalf of the Murrells, they do not dispute that the Unit Owners have an estate or interest in the Airspace. In my opinion, the effect of the statutory scheme pursuant to which title to the Airspace is vested in the Owners Corporation is that the Unit Owners do have an equitable interest in the Airspace: see [151]–[154] above.

However, there is a dispute about whether the Unit Owners’ estate or interest in the Airspace is “evidenced by an instrument registered in the General Register of Deeds or the Register kept under the Real Property Act 1900”. As the Court of Appeal held in Community Association DP 270447 v ATB Morton Pty Ltd (supra) (Morton) at [88]–[90] (Leeming JA, Bell P and Payne JA agreeing), those words “do real work in restricting the class of persons who are identified by the subsection” and about whose ability to receive adequate compensation the Court must be satisfied before granting an easement under s 88K.

It was submitted on behalf of the Murrells that the Court of Appeal’s judgment in that case was directly applicable to this case, with the result that the Unit Owners do not have a compensable interest under s 88K(2)(b).

In Morton, the main issue was the test to be applied in Land and Environment Court proceedings seeking an order imposing an easement said to be reasonably necessary for the effective use or development of the land to be benefitted, and the necessary parties to such proceedings.

Section 40 of the Land and Environment Court Act 1979 (NSW) provides:

The language describing persons other than the owner of the land in s 40(3) is the same as the language in s 88K(2)(b) of the Conveyancing Act. Section 40(4) picks up the whole of s 88K.

The respondent, ATB Morton Pty Ltd, sought an easement under s 40 over a private road on land owned by the appellant.

The appellant was a community association, being a corporation constituted under the Community Land Development Act 1989 (NSW) (the CLD Act) by the registration of a community plan as a deposited plan. The community association was the owner of lot 1 in the deposited plan. The members of the community association owned community development lots 2 to 6 in the deposited plan: Morton at [75]–[76]; see Community Land Management Act 1989 (NSW), s 5; CLD Act, s 25.

The community plan had included a schedule of unit entitlements, as required by s 5(2)(d) of the CLD Act. On registration of the deposited plan, lot 1 had vested in the community association pursuant to s 31(1) of the CLD Act. Pursuant to s 31(4) of the CLD Act, the community association’s estate or interest in lot 1 was held by it “as agent for all the members as tenants in common in the shares prescribed by s 32”. Pursuant to s 32(1), those shares reflected the proportion of the unit entitlements ascribed to each member’s lot to the total unit entitlement under the community scheme. (I note the provisions of the strata legislation to the same effect concerning the vesting of common property in the owners corporation, which holds that property as agent for lot owners as tenants in common in shares proportional to the unit entitlement of the owners’ lots: 2015 Act, ss 24, 28(1); 1973 Act, ss 18, 20; see [151] above.)

Leeming JA (with whom Bell P and Payne JA agreed) referred with approval to the line of authority which holds that the statutory “agency” pursuant to which an owners corporation holds the common property of a strata scheme under the Strata Schemes Development Act 1973 is, or is analogous to, a trust and that the owners of lots in the scheme have an equitable interest in the common property and stated that this was based not only on the statutory agency but also on the express reference in s 24(2) of the 1973 Act to the “beneficial interest” of lot owners in common property: Morton at [80]–[83]; see [153] above.

Leeming JA then referred (at [84]–[85]) to the provisions of s 33 of the CLD Act. On the one hand, s 33(2) refers to the way in which an estate or interest in community property, held by a community association as agent for the proprietor of a community development lot, may dealt with. His Honour considered that this suggested that a lot owner does have a beneficial estate or interest in community association property. On the other hand, s 33 did not expressly describe that estate or interest as a beneficial interest, which his Honour regarded as a striking departure in comparison to the language of s 24(2) of the 1973 Act.

However, Leeming JA refrained from determining whether or not the interest of community development lot owners in the community property held by the community association as agent was a beneficial interest in that community property. His Honour assumed (at [88]) that those interests were beneficial interests in the community property. On the basis of that assumption, Leeming JA then proceeded (at [88]–[93]) to determine whether those interests were evidenced by a registered instrument as required by s 40(3) of the Land and Environment Court Act and s 88K(2)(b) of the Conveyancing Act. His Honour concluded that those interests were not evidenced by a registered instrument. Although the community association held the community property as agent for community development lot owners as tenants in common in shares proportionate to their respective unit entitlements, and their unit entitlements were recorded on the Register, this merely identified the rights and liabilities enjoyed by lot owners as between each other in terms of voting and bearing of costs. It did not result in lot owners’ estate or interest in the community property being evidenced in the Register.

The primary submission on behalf of the Owners Corporation was that: [146]

I accept the first element of this submission. The Owners’ Corporation’s legal interest in the common property, including the Airspace, is recorded in SP 85044. The second element of the submission may also be accepted: see [153]–[156] and [423] above.

However, the third and fourth elements of the submission are not sound. The Unit Owners’ interest in the Airspace is no more “intrinsically linked” to the Owners’ Corporation’s legal interest evidenced by the registered strata plan than was the case in Morton for the community development lot owners’ (assumed) beneficial interest in the community property and the community association’s legal interest in the property which was evidenced by the community plan. The submission, in substance, invites this Court not to follow Morton. The Court of Appeal’s decision is, of course, binding on me unless there is some relevant distinction between the legislation and facts in Morton and the legislation and facts in the present case. In my opinion, having regard to the assumption in Morton that the community development lot owners had an interest in community property equivalent to the interest that members of a strata scheme have in common property held by an owners corporation as agent, there is no relevant distinction.

The Owners Corporation made an alternative submission that there is a close connection between the Unit Owners’ interests in the common property (including the Airspace) and their interests in their Units, and that their interests in the common property are therefore evidenced by a registered instrument by reason of their interests in the Units being evidenced by the registered strata plan and being recorded in the Register. [147]

This alternative submission relied on s 28(2) and s 28(3) of the 2015 Act as evidencing the close connection between the Unit Owners’ interests the common property and their interests in their lots.

As noted in [151] above:

The 1973 Act and the CLD Act under consideration in Morton contained provisions to the same effect, save that the CLD Act does not contain a provision equivalent to s 28(2) of the 2015 Act precluding the severance of a community development lot owner’s interest in community property from his or her interest in the community development lot: see 1973 Act, ss 24(1) and (2); CLD Act s 33(6)(a). That omission from the CLD Act is consistent with s 15 and Schedule 8 of the CLD Act, which provide for a community development lot to be severed from a community scheme in accordance with an order of the Court or by consent of the lot owner and the community association. There is no equivalent severance provision in the strata schemes legislation.

It seems to me that the inclusion of the severance provision in s 15 and Schedule 8 of the CLD Act reflects the fact that, unlike strata schemes, community schemes facilitate staged development of land and need to accommodate potential exclusions of some areas from the scheme as the development progresses: see B Edgeworth, Butt’s Land Law (7th ed, 2017, Lawbook Co) at [13.420]–[13.450]. If a community development lot is severed from the community scheme, the total unit entitlements for the community scheme are reduced by the number of unit entitlements of the severed lot. There is no provision in the CLD Act which provides for a community development lot owner’s interest in the community property to be dealt with separately from their interest in their lot, whilst their lot remains part of the community scheme. If their lot is severed from the community scheme, their unit entitlements by reason of which they have an interest in the community property are effectively cancelled.

For those reasons, it is my opinion that there is nothing in the 2015 Act (or its predecessor, the 1973 Act) and the CLD Act to suggest that the “connection” between the interest of a community development lot owner in community property and their interest in their own lot is less “close” than the connection between the interests of a strata scheme member in the common property and that member’s interest in their own lot. Accordingly, Morton is not distinguishable from the present case on the basis of a difference in the nature of the “connection” between the individual lot owner’s interest in their lot and their proportionate interest in common property or community property. There is no reason why the conclusion in Morton that the community development lot owners’ assumed equitable interest in the community property, held by the community association as agent for those lot owners, does not apply equally to the Unit Owners’ equitable interests in the Airspace held by the Owners Corporation in this case.

I note for completeness that the submissions on behalf of the Owners Corporation placed heavy emphasis on the fact that members of a strata scheme have been found by the authorities referred to in [153] above to have an equitable interest in the common property, whereas the Court of Appeal in Morton considered that the same may not be able to said of community development lot owners’ interests in community property. It was submitted that this was another basis on which Morton was distinguishable from the present case. However, these submissions overlook the fact that the Court of Appeal in Morton assumed that community development lot owners did have an equitable interest in community property, before deciding that the interest was evidenced by a registered instrument. By reason of that assumption, the Court of Appeal’s reservations concerning the nature of the interests in community property had no bearing on their conclusion that those interests are not evidenced by a registered instrument.

For all of those reasons, whilst each of the Unit Owners has an equitable interest in the Airspace, those equitable interests are not evidenced by a registered instrument. Accordingly, s 88K(2)(b) does not require the Court to be satisfied that Unit Owners can be adequately compensated for any loss or other disadvantage that will arise from the imposition of the proposed easement. Section 88K(2)(b) requires only that the Court be satisfied that the Owners Corporation can be adequately compensated for any loss or other disadvantage that it may suffer from the imposition of the proposed easement.

It follows that the questions raised by s 88K(2)(b) in this case are: [148]

The concept of “loss or other disadvantage” in s 88K(2)(b) is not limited to the value of the putative servient tenement owner’s proprietary right taken by the imposition of the proposed easement.

However, there must be a causal relationship between the “loss or other disadvantage” and the imposition of the proposed easement.

Any such loss or other disadvantage must be offset against any compensating advantage to the servient tenement owners arising from the imposition of the proposed easement when determining whether the servient tenement owners can be adequately compensated for the purpose of s 88K(2)(b) and when determining the amount of any such compensation under s 88K(4).

The Owners Corporation candidly acknowledges that it will not suffer any loss or other disadvantage arising from the imposition of the proposed easement. However, the Owners Corporation submits that it follows that the Owners Corporation cannot be compensated and that the Court must decline to impose the easement because s 88K(2)(b) is not satisfied. [149]

I reject that submission. Section 88K(2)(b) requires that “any loss or other disadvantage” to the Owners Corporation arising from the imposition of the proposed easement can be adequately compensated. The Owners Corporation has conceded (correctly, in my view) that there is no such loss. It follows that there is no call for compensation and that s 88K(2)(b) is satisfied.

In case the Unit Owners are held in any appeal to be persons with an estate or interest in the Airspace evidence by registered instrument within the meaning of s 88K(2)(b) (contrary to my conclusion above), I record here my opinion that Unit Owners will not suffer any loss or other disadvantage as a result of the imposition of the proposed easement.

The Owners Corporation’s submissions identified the following loss or disadvantage to Unit Owners as arising from the imposition of the proposed easement:

The Owners Corporation submitted that loss of views, security and privacy are intangible detriments that cannot be compensated.

The Owners Corporation relied on Khattar v Wiese (2005) 12 BPR 23,235; [2005] NSWSC 1014, in which Brereton J said (my emphasis):

In the present case, the proposed easement would interfere with the views and privacy enjoyed by some Unit Owners temporarily during the carrying out of repair and maintenance work for which access to the Airspace is necessary.

The suggestion that the proposed easement would interfere with the security of Unit Owners is puzzling. It assumes that the owners of Part Lot 21, or their contractors, who enter onto the flat concrete roof for the purpose of carrying out work on that roof would take the opportunity to illegally access the premises of the Unit Owners. [150] It seems to me that any person wishing to illegally access those premises would not wait for an easement, or a contract to perform work on the roof of Part Lot 21, to do so.

In my opinion, the extent of the temporary interferences with views and privacy would be the same or similar to that occasioned by the Murrells and their contractors entering into the Airspace during the period from November 2018 to June 2019. For all the reasons addressed under Issue 5 above, [151] the extent of the temporary interferences would be limited to a minor disruption of views for some Unit Owners, some interference with the privacy enjoyed by the occupants of Unit 2 (from some parts of Unit 2 only), and some noise disturbance. These are small disadvantages of an intangible nature, which must be offset against the benefit to Unit Owners flowing from the imposition of the easement – namely, the concrete roof on Part Lot 21 will be in a better state of repair and therefore more pleasant (or at least less unpleasant) to look at from the terraces of their Units.

In my opinion, the advantages and disadvantages to Unit Owners in this case cancel each other out, and the impact of the proposed easement on the amenity of Unit Owners therefore does not represent any net disadvantage which must be capable of compensation under s 88K(2)(b) (assuming, contrary to my conclusion above, that Unit Owners have an estate or interest in the servient tenement evidenced by a registered instrument).

Even if I had been of the view that there was a loss of amenity representing a net disadvantage to Unit Owners, this would not have been a substantial intangible detriment of the kind referred to by Brereton J in Khattar v Wiese (supra) and could have been adequately compensated in monetary terms: see Rainbowforce Pty Ltd v Skyton Holdings Pty Ltd (2010) 15 BPR 29,637; [2010] NSWLEC 2 at [111] and [114].

The Owners Corporation adduced evidence from a certified practising valuer, Mr Paul Donovan.

In his report dated 15 April 2020, Mr Donovan expressed the opinion that Units 1, 2 and 3 would suffer a loss of value “stemming from the reduced privacy, security and impeded views that will result from the granting of the easement”. Mr Donovan’s reasons for this opinion are that:

Mr Donovan did not consider that the proposed easement would have any impact on the market value of Unit 4.

Mr Donovan considered that the appropriate approach was to assess the current market value of Units 1, 2 and 3 (without the proposed easement) and the market value of those units if the proposed easement were imposed by the Court. Mr Alford, the valuer whose reports were tendered by the Murrells, agreed with this approach.

Mr Donovan formed his opinion as to the current value of Units 1, 2 and 3 having regard to recent sales of six apartments in Rose Bay, Darling Point and Double Bay. Mr Alford agreed with the current values arrived at by Mr Donovan.

Mr Donovan expressed the opinion that the market values of Units 1, 2 and 3 would be diminished by 4%, 5% and 2.5% (respectively) as a result of the imposition of the proposed easement.

This opinion was supported only by Mr Donovan’s characterisation of the proposed easement as allowing access into the Airspace “in an uncontrolled manner”, his concern that the proposed easement gave rise to insecurity that others may seek to impede into the Airspace in the future, and his experience of the behaviour of purchasers in the market, as referred to above.

The proposed easement does not permit uncontrolled access into the Airspace. It permits access into the Airspace for limited purposes.

There is no logical basis for Mr Donovan’s concern that, if the proposed easement is granted, this may encourage or facilitate other persons seeking access to the Airspace in the future.

As Mr Alford points out, Mr Donovan does not take into account the benefit to Unit Owners of the Murrells having the ability to repair and maintain the roof that forms part of the outlook from Units 1, 2 and 3. I reject the Owners Corporation’s submission that Mr Alford’s report focussed exclusively on the benefit. Mr Alford considered both the advantages and disadvantages to Unit Owners of the proposed easement and how those advantages and disadvantages might be viewed by potential purchasers of the Units. I also reject the Owners Corporation’s submission that Mr Alford should have had regard to the fact that advantages of the proposed easement could be achieved without the imposition of an easement by obtaining the Owners Corporation’s consent to undertake the work on the roof. I consider this submission to be disingenuous, having regard to the Owners Corporation’s steadfast refusal to consent to the Murrells undertaking work on the roof, irrespective of the nature of the work and the level of information provided and offered to them, as set out in detail under Issue 5 above.

Mr Donovan’s quantification of the diminution in value was unsupported by market evidence and appears to be inconsistent with the evidence of comparable sales on which he relied in determining the current market value of Units 1, 2 and 3.

Mr Donovan’s “Sale 1” involved an apartment in Rose Bay with views looking across the suburb to the harbour. “Sale 2” involved the sale of an apartment directly on the beachfront at Rose Bay, with panoramic and intimate harbour and beach views. “Sale 3” and “Sale 4” involved apartments with no substantial views. “Sale 5” involved a property with partial harbour views. “Sale 6” involved an apartment with pleasant district views only (no harbour views).

On the basis of the photographic evidence, it is the views from “Sale 1”, looking across buildings in Rose Bay to the harbour, that are most comparable to the views from Units 1, 2 and 3 of 95 Wentworth Road looking across the concrete roof of Lot 21 to the harbour.

As Mr Alford identified in his report dated 8 May 2020, in the view from Mr Donovan’s “Sale 1” apartment, the foreground includes the flat roof of an apartment building and the harbour is in the background. Mr Alford identified the address and title of that apartment building with the flat roof. On the basis of title searches of that apartment building and the “Sale 1” property, Mr Alford ascertained that there are no restraints on the ability of the owners of the flat-roofed apartment building to enter into the airspace above their roof to carry out work on that roof (which would interfere with the harbour views from the “Sale 1” apartment in the same sense that the temporary presence of persons or equipment of the Murrells’ roof would interfere with harbour views from Units 1, 2 and 3). Mr Alford also ascertained from those title searches that the owners of the apartment building in which the “Sale 1” property is situated have no proprietary rights over the airspace above the flat-roofed apartment building.

Despite the obvious potential for works on the roof of the flat-roofed apartment building, Mr Donovan recorded that “Sale 1” sold at a price equivalent to $38,522 per square metre, significantly greater than Mr Donovan’s per square metre current (without easement) valuations ascribed to Unit 1, 2 and 3 at 95 Wentworth Road.

Taking into account these features of “Sale 1” and the benefits to Unit Owners of the outlook from their Units being improved by the owners of Lot 21 being able to undertake repair and maintenance of the flat concrete roof, Mr Alford expressed the opinion that the proposed easement would not result in any diminution in the value of Units 1, 2 and 3.

In my opinion, Mr Alford’s evidence is to be preferred to Mr Donovan’s evidence. Mr Alford’s opinion is informed by consideration of the disadvantages and advantages of the proposed easement and the different ways in which they may be considered by potential purchasers, [152] in addition to his assessment of the features of the “Sale 1” property and its views. By contrast, Mr Donovan has ignored the advantages and his report does not explain how his comparable sales evidence has been applied in arriving at his opinions concerning diminution in market value of Units 1, 2 and 3. Indeed, in cross-examination, Mr Donovan conceded that there was no market evidence that could be applied to determine any diminution in value. Mr Donovan claimed to have taken into account the potential for views from “Sale 1” to be disrupted by access to the flat roof in the foreground of those views, but did not explain in any coherent manner how he had done so. [153]

For all of those reasons, it is my opinion that, if s 88K(2)(b) requires that any loss or other disadvantage to Unit Owners can be adequately compensated (contrary to my conclusion above), the Unit Owners will not suffer any such loss or disadvantage arising from the imposition of the proposed easement.

In summary, I have concluded for the reasons above that:

The applicable principles were conveniently summarised by Preston CJ in Rainbowforce (supra) at [131] (citations omitted):

The Murrells relied on the following offers made by them in the course of the parties communications summarised under Issue 5 above as demonstrating that they had made all reasonable attempts to obtain the easement, or an easement having the same effect:

I accept the Owners Corporation’s submission that the Murrells’ correspondence dated 9 May, 27 May and 5 June 2019 was an attempt by the Murrells to persuade the Owners Corporation to enter into an agreement that would permit the Murrells to access the Airspace and was not an attempt to obtain an easement. An easement is a proprietary, rather than a contractual, right. It would apply to successors in title to the Murrells and the Owners Corporation. What s 88K(2)(c) requires is that there have been all reasonable attempts to obtain the easement or an easement having the same effect. Attempts to obtain a contractual right do not satisfy that requirement.

However, the Murrells’ attempts to negotiate a contractual right of access to the Airspace, together with the Owners Corporation’s responses to those attempts, do form part of the context in which their later attempts to obtain an easement fall to be considered for the purpose of s 88K(2)(c).

The Murrells first attempted to obtain an easement on 3 December 2019, more than two months after the Murrell proceeding had been commenced.

The Owners Corporation submitted that this attempt, and the subsequent attempts on 24 an 29 April 2020, could not be regarded as reasonable attempts to obtain an easement having the same effect as that sought under s 88K because no attempt to obtain an easement was made prior to the commencement of the Murrell proceeding.

I respectfully agree with Pain J in in Tenacity Investments v Ku-Ring-Gai Council [2008] NSWLEC 27 at [72] that the terms of s 88K contain no indication that the Court, in applying s 88K(2), is limited to considering the state of affairs at a time earlier than the hearing of the application for an order imposing the easement.

Just as the question of reasonable necessity under s 88K(1) must be assessed by reference to all of the circumstances as they exist at the time of the hearing, [154] so much each of the matters in s 88K(2) be assessed at the time of the hearing. The Court must be satisfied of each of the matters in s 88K(2) before imposing an easement (assuming that s 88K(1) is also satisfied). In my opinion, it would be absurd if the Court was required to decide whether it was satisfied of the matters in s 88K(2) at the time of the hearing by reference to some earlier point in time and was unable to take into account events in the period leading up to the hearing.

Ordinarily, it is to be expected that an applicant for an easement under s 88K will have at least commenced the process of making reasonable attempts to obtain the easement sought by negotiation, before commencing proceedings. It will not be uncommon that the negotiation continues after the commencement of proceedings – litigation often sharpens the focus of parties’ negotiations. For the reasons above, I respectfully agree with Pain J’s approach in Tenacity Investments v Ku-Ring-Gai Council (supra) (at [69]–[72]) of considering the whole of the negotiations, both before and after the commencement of the proceedings, in applying s 88K(2)(b). I respectfully decline to adopt her Honour’s obiter dicta remark (at [195]) to the effect that failure to take steps to obtain an easement before commencing proceedings would ordinarily weigh heavily against an applicant. If s 88K(1) and all of the requirements of s 88K(2) are satisfied, then the question whether the Court should exercise its power to make an order imposing an easement will depend on all of the circumstances of the case. The whole of the course of conduct of the parties is likely to be relevant, and the significance of the applicant’s failure to take steps to obtain an easement prior to commencing proceedings falls to be determined in the context of that course of conduct and all other relevant matters.

In this case, it was reasonably clear from the whole of the dealings between the parties as summarised under Issue 5 above that that the Owners Corporation was determined not to permit the Murrells to enter the Airspace. The Owners Corporation maintained that stance after receiving the Murrells’ first correspondence seeking an easement on 3 December 2019. Mr Howse’ evidence was that the Owners Corporation was not prepared to grant the Murrells’ an easement on any terms. [155] The Owners Corporation did not even bother to respond to the Murrells’ solicitor’s letter of 3 December 2019, despite the Murrells’ solicitor sending follow up communications to the Owners Corporation’s solicitor seeking a response. [156]

By December 2019, the Murrells had not entered the Airspace for approximately six months. I infer that any attempt to negotiate an easement with the Owners Corporation prior to December 2019 would have been met with the same stony silence, or outright refusal, from the Owners Corporation.

I also infer that, after the Owners Corporation’s refusal to respond to the Murrells’ attempt to negotiate an easement in early December 2019, the Murrells resigned themselves to the inevitability of these proceedings running their full course. Section 88K(2)(c) did not require the Murrells to continue endeavouring to negotiate with the Owners Corporation in circumstances where it was clear that those attempts would be futile.

It is understandable that the Murrells nevertheless made further attempts to negotiate an easement immediately prior to during the hearing of the proceedings on 24 and on 29 April 2020. It is not uncommon that the realities of contested proceedings cause parties to reassess the pros and cons of a compromise compared to a court-imposed outcome. Those attempts also failed.

For completeness, I note the Owners Corporation’s submissions that the offers made on 3 December 2019, 24 April 2020 and 29 April 2020 were not reasonable attempts because they were predicated on Mr Donovan’s methodology for assessing compensation being rejected and they did not adequately address the Owners Corporation’s costs of the whole of these proceedings or explain how the Owners Corporation’s costs of the s 88K element of these proceedings was to be separated from its costs of the balance of the proceedings if the offer were taken up. I do not consider that s 88K(2)(c) requires that attempts to obtain an easement resolve the entirety of a larger dispute between the parties, including resolving the question of costs of proceedings which are provided for in s 88K(5). The fact that the Owners Corporation wished to continue the proceedings and advocate for compensation in accordance with Mr Donovan’s report is not relevant. The question is whether the Murrells’ attempts to obtain the easement were reasonable, not whether it was reasonable for the Owners Corporation to reject those attempts.

For all of the reasons above, I have concluded that, whilst it would have been preferable for the Murrells to seek to discuss an easement with the Owners Corporation prior to commencing proceedings, the Murrells had made all reasonable attempts to negotiate the easement by the time of the hearing of the s 88K application.

For the reasons explained under Issues 10 to 13 above, I have concluded that an order should be made under s 88K imposing an easement in terms to the following effect , and that no compensation is payable in the special circumstances of the case addressed under Issue 12 above:

The Owners Corporation seeks:

In view of my decision to make an order under s 88K of the Conveyancing Act, it would not be appropriate to grant an injunction in these terms. The claim for relief in prayer 1 of the summons and prayer 5 in the amended statement of claim in the Owners Corporation proceedings is therefore dismissed.

There is no dispute that the Murrells’ contractors erected a stud wall on part of the Boundary Wall. There is a dispute about whether the Boundary Wall on which this work was done was:

There was no expert or other evidence before the Court that would enable this discrepancy between the two plans to be resolved. As the Owners Corporation bears the onus of proving that the Murrells entered into the Owners Corporation’s property, the claims in trespass and nuisance relating to the erection of the stud wall on the Boundary Wall, and the painting of the Boundary Wall, fail at this first hurdle.

These claims of the Owners Corporation are dismissed for the reasons explained under Issue 16 above.

The Owners Corporation has failed to prove that the painting of the boundary wall constituted trespass or nuisance for the reasons explained under Issue 16 above.

These claims of the Owners Corporation are dismissed for the reasons explained under Issue 16 above.

My conclusions are summarised in [75] above.

The parties should formulate the precise terms of the orders to give effect to my reasons for judgment in relation to the Murrells’ claim for an easement under s 88K of the Conveyancing Act (Issues 10 to 14 above). Those orders should impose an easement in the terms of an attached s 88B instrument with accompanying plan intended to be registered to give effect to my reasons. I have set out the terms of the easement under Issue 14 above, but the parties are at liberty to amend the descriptions of the dominant and servient tenements to ensure that they are clearly described by reference to the current folio identifiers for those tenements and the plan that is to accompany the s 88B instrument to be attached to the orders.

Section 88K(5) of the Conveyancing Act provides that the costs of proceedings under s 88K are payable by the applicant for the easement, subject to any order of the Court to the contrary. I am not presently aware of any reason why the Court should order to the contrary in this case. [159] If no such reason is identified, and if costs follow the event in relation to the balance of the Murrell proceeding, this would result in the Murrells paying the Owners Corporation’s costs of the Murrell proceeding. If costs follow the event in relation to the Owners Corporation proceeding, the Murrells would also pay the Owners Corporation’s costs of that proceeding as the Owners Corporation has succeeded in part of its claim in trespass. That claim was the most significant issue in the Owners Corporation proceeding. This is not a case that lends itself to issues-based costs orders.

However, the parties asked that I hear them in relation to costs once the outcome of the proceedings is known, and there may be reasons that I am not presently aware of why the Murrells should not pay the costs of the s 88K application or why the costs of the balance of the proceedings should not follow the event. I will therefore determine the question of costs on the papers once the parties have had an opportunity to make written submissions.

I make the following orders and directions: