Australia: Imposing statutory rights of use in Queensland: When is a refusal to grant unreasonable?

Until recently, there was some ambiguity around the considerations that a court may take into account in determining whether the refusal to grant a right of use is unreasonable.

The recent Supreme Court of Queensland (QSC) case of Ward v Hull1 has clarified this ambiguity by summarising the considerations which may be relevant when making this decision.

In this article, we take a look at these considerations, with a particular focus on cases involving development scenarios. For example, the developer of the El Dorado Cinema complex was given a right of use to install temporary rock anchors under the adjoining property.

WHAT IS A RIGHT OF USE?

A right of use allows a person to have access to, or use, a piece of land which they do not own. For example, an access easement is a type of right of use that will allow a person to access their own land (the dominant land) by passing over the land of another person (the servient land).

In some instances, the owner of the servient land may refuse to grant a right of use to the owner of the dominant land. This refusal may consequently inhibit or impact the dominant land owner's access to, or commercial operations on, their property. However, the Property Law Act 1974 (Qld) (PLA) grants the QSC a power to impose a statutory right of use (for example, an easement) over land on certain conditions, one being that the servient land owner's refusal to grant a right of use to the dominant land owner was unreasonable.2

RELEVANT LAW

The courts have a discretionary power to impose a right of use over a piece of land, even against the landowner's wishes.3 However, under section 180(3) of the PLA, the court must be satisfied that the following conditions exist before exercising the power:

  1. The imposition of the right of use must be in the public's interest;
  2. The owner of the servient land can be adequately compensated through money for any loss or disadvantage which they may suffer because of the granting of the right of use; and
  3. Either:
    1. the owner of the servient land has refused to grant the right of use, and this refusal was unreasonable in the circumstances; or
    2. no person with the necessary capacity to grant a right of use can be found.

UNREASONABLE REFUSAL

Historically, the court has taken a wide range of factors into account when determining whether the refusal to grant a right of use is unreasonable. While the words 'unreasonable refusal' prompt an objective test (i.e. whether or not an ordinary person would consider the refusal unreasonable), subjective circumstances may also be taken into account.4 The considerations appear to be consistent throughout cases concerning access rights below, on, or above the servient land.

Most cases involving an application for the imposition of a statutory right of use concern easements to allow access to landlocked properties. In one particular case involving a landlocked cattle farm in north Queensland, the servient land owner's refusal to grant an easement was held to be reasonable after the applicant had offered inadequate compensation and had sent them numerous threats to demand to be allowed access to the land for the purposes of transporting cattle.5 Threatening behaviour was also considered to be a ground for reasonably refusing a right of use in Naylor & Anor v Pierce & Anor.6

Other cases discussing unreasonable refusal have involved cranes on development sites over sailing an adjacent property. In such a case involving a development in Brisbane, it was held that the servient land owner's refusal to grant a right of access to allow a crane to swing freely over the servient land was reasonable. This was because it was clear that the developer's behaviour to the servient land owner prior to requesting the right of access was largely inconsiderate, and because the presence of the crane over the servient land was likely to decrease the value of the servient land.7

Finally, the unreasonable refusal to grant an access right beneath the surface of the servient land has not been expressly addressed in the case law. However, it is likely that refusal would be reasonable where the access would prevent the servient land owner from enjoying their land,8 or where the access could cause detriment to structures on the servient land.9

In the past, statutory rights of use have been successfully imposed beneath the surface of servient land for the drilling and placement of rock anchors to support the dominant land and the effective use of the dominant land.10

UNREASONABLE REFUSAL IN WARD V HULL

This case involved two adjacent cane farms near Mackay, Queensland. The applicant sought the imposition of an easement to allow an underground pipeline to cross through the respondent's land (i.e. the servient land). The pipeline enabled the applicant to source water from a nearby creek. Without the pipeline, the applicant's commercial operations on the dominant land were near impossible.

The relevant facts included:

  • the necessary pipeline was installed in 1999 through an undocumented agreement between the applicant and a previous owner of the servient land;
  • the respondent became the owner of the servient land in 2004, and the applicant continued to pump water from the creek without issue until 2016;
  • in June 2016, the respondent proposed to lower the pipeline at the applicant's cost so that the respondent could utilise more of the servient land for sugar cane production. The applicant refused this proposition and requested a written undertaking from the respondent that the respondent would not perform any earthworks until an agreement had been reached;
  • in early October 2016, the applicant wrote to the respondent enclosing a draft easement and valuation report addressing the amount of compensation required for the grant of the easement ($5,000). The respondent maintained their stance that the pipeline needed to be lowered in order to allow the respondent to fully utilise the dominant land for cane farming;
  • in late October 2016, the applicant attempted to pump water using the pipeline but was unsuccessful due to the respondent having installed a junction to the pipeline to the respondent's own dam. As a result, the applicant filed an application seeking to restrain the respondent from interfering with or obstructing the pipeline; and
  • in February 2018, the respondent presented the following three settlement offers to the applicant:
    1. The respondent would grant a perpetual licence allowing the applicant to pump water through the pipeline. The respondent would bear the costs of lowering the pipeline, but the applicant would be required to pay a yearly fee of $4,000 to use the pipeline, in addition to fees for pumping.
    2. A new pipeline would be installed along the respondent's fence line at the cost of the applicant and an easement would be granted over the relevant parts of the servient land (with the applicant to compensate the respondent for the easement).
    3. The original pipeline was to be lowered at the cost of the applicant.

The parties were not in dispute about whether the granting of the easement would be in the public's interest, or whether the respondent could be adequately compensated for any loss or damaged suffered from the granting of the easement. Rather, the primary issue was whether the respondent's refusal to grant the easement was unreasonable in the circumstances.

After considering the principles outlined in the cases above, the court set out 12 relevant considerations which may be taken into account when determining whether a refusal is unreasonable. These are:11

  1. Whether a dispute that is irrelevant to the granting of the right of use exists or existed between the parties.
  2. Poor attitude of the applicant towards the respondent.
  3. Whether the terms of the proposed easement are too broad or are insufficiently detailed.
  4. Lack of evidence regarding reasonable compensation.
  5. The adequacy of the compensation offered.
  6. Whether the applicant purchased the land with knowledge of the access difficulties.
  7. Absence of any significant detriment, loss or harm to the respondent.
  8. The significant cost associated with establishing any alternative access to the proposed easement.
  9. Historic usage of the existing passageway over the servient land to access the dominant land.
  10. Whether the refusal was motivated by ill will, malice or bitterness.
  11. Whether there has been the refusal of reasonable offers subject to appropriate conditions.
  12. Evidence from witnesses about the difficulties of alternative approaches proposed by the owner of the servient land.

It was also noted that these considerations were guiding only, and that some may not be relevant in every case.12

In this case, it was held that the refusal was unreasonable, primarily because the portion of the land affected by the pipeline was not suitable for caning.13 Because of this, the court noted that the respondent's propositions to lower the pipeline or reposition the pipeline along the boundary of the servient land were poorly grounded.14

Second, the court pointed out that the respondent was aware of the existence of the pipeline at the time the respondent purchased the servient land in 2004, and that the applicant had successfully continued to use the pipeline until 2016.15

Finally, it was held that the amount of compensation offered by the applicant was sufficient, as the affected portion of the servient land was not suitable for commercial use.16

KEY TAKEAWAYS

Ward v Hull has provided some clarity on the considerations which a court may take into account when determining whether a refusal to grant a right of use is unreasonable.

As the scope of potential considerations is quite broad, it remains clear that the court will adopt a case-by-case approach when assessing applications for the imposition of statutory rights of use. While the QSC primarily considered Queensland statute and case law when mapping out these considerations, it is arguable that courts in other jurisdictions may make the same considerations when assessing an application for a statutory right of use (provided that the legislation in the relevant jurisdiction requires that there was prior unreasonable refusal on the part of the servient land owner).

If you are seeking the imposition of a right of use through a court order on the basis that the servient land owner's refusal was unreasonable, it will be important to take into account the various considerations outlined above when assessing your prospects of success.

In addition, both servient and dominant landowners should be aware of how their behaviour throughout the discussions or negotiations for a right of use could impact future prospects of imposition.

Footnotes

1 [2019] QSC 32

2 Property Law Act 1974 (Qld) s 180.

3 Above n 1, s 180(1).

4 Grittner & Anor v Hadley [2008] QSC 268 at [93], affirmed in Naylor & Anor v Pierce & Anor [2010] QSC 399 at [82].

5 Bradshaw v Griffiths [2016] QCA 20.

6 [2010] QSC 399.

7 Graham v KD Morris & Sons Pty Ltd [1974] Qd R 1.

8 Bernstein v Skyviews & General Ltd [1978] QB 479, 487.

9 De Napoli v New Beach Apartments Pty Ltd [2004] NSWSC 52.

10 Re Roobottom & Anor, [1998] QSC (unreported).

11 Above n 2 at [26].

12 Ibid at [27].

13 Ibid at [56].

14 Ibid.

15 Ibid at [57].

16 Ibid at [58].

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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