Practitioners acting for landowners in compulsory acquisition matters should note that s 131 of the Public Works Act 1900 (NSW) operates as a prohibition on partial taking rather than a compulsion to take the whole, and that once a decree gives the Government an election, the owner's remedy upon the Government declining to resume is reconveyance, not compulsion to acquire.
Whitfeld Nominal Defendant, Appellant; and McQuade and Another Plaintiffs, Respondents.
H C of A
On appeal from the Supreme Court of New South Wales
11 December 1908
Griffith C.J., Barton, Isaacs and Higgins JJ.
Cullen, K.C. (Langer Owen K.C. and Harriott with him), for the appellant.
Pilcher K.C. and Rich (Gordon K.C. and Dr. Coghlan with them), for the respondents.
Cullen K.C. in reply.
December 11
Griffith C.J.
The Public Works Act 1900 authorizes the Governor to resume land from private persons under conditions set out in the Act. Two methods of resumption are provided. One is a summary method by notification published in the Gazette which usually takes the form of a proclamation by the Governor in Council. Upon publication of that notification in the Gazette the land becomes vested in the constructing authority. The other method, analogous to the method established in England by many Statutes, of which the Lands Clauses Consolidation Act is one, is by notice to the owner. Sec. 131, which stands in Part VIII., described as "provisions applicable in every case where land is taken or acquired for authorized works," provides that "no party shall, at any time, be required to sell or convey to the constructing authority a part only of any house or other building or manufactory, if such party is willing and able to sell and convey the whole thereof."
The respondents in the present case are the owners of a residential property fronting the harbour of Port Jackson and containing about 1 ½ acres. The Government were about to construct a wharf on the frontage and desired to take a portion of the property. They adopted the first method of resumption, and on 20th November 1900 a Gazette notification was published by the Governor with the advice of the Executive Council resuming a portion containing 30 perches. This particular portion of the land fronted the harbour, much of it being reclaimed land, and was practically bounded on the harbour side by a stone wall. The land was required by the Government not for the purpose of constructing any works or buildings upon it, but for the purpose of fixing under its surface supports for a wharf to be erected in deep water some distance from the shore. The works were begun at some time in 1900, and the work was finished, so far as any work upon that piece of land was concerned, in June 1901. On 7th May 1901 the owners of the land gave notice to the Government that they objected to sell part of the land, and required the Government, if they took any, to take the whole. On 26th May 1902, more than a year afterwards, they commenced a suit against the Government of the State in the Supreme Court in its equitable jurisdiction by which they submitted (paragraph 7 of the statement of claim), that the whole of the "house land curtilage and garden must be resumed if any portion thereof be taken," and claimed that in the event of the Government declining to do so, it might be declared that the defendant Minister only held the portion resumed as trustee for the plaintiffs, and might be directed to do all things necessary to reconvey it to them. The Government in their defence did not raise any question whether the whole area of 1 ½ acres came within the words "house or other building or manufactory" in sec. 131; nor did they raise any defence founded upon the fact that the owner of the land had waited for several months, during which work had been going on upon the land, before claiming to take advantage of sec. 131. The only defence set up was a submission to the judgment of the Court of the question of law raised by the 7th paragraph of the statement of claim, to which I have already referred. The suit came on for hearing, and the learned Chief Judge in Equity was of opinion that sec. 131 applied to the case, and made a decree in terms of the prayer of the statement of claim. That decree, which was dated 22nd September 1902, after declaring that the Government were not entitled to resume the portion in question without resuming the whole and ordering that the Government be restrained accordingly, proceeded "this Court doth declare that in the event of the Government declining to resume the residue of the said land ... the defendant holds the said portion so resumed in trust for the plaintiffs, and ... doth order that in the event of the said Government so declining to resume the residue ... the defendant ... do all things necessary to revest the said portion so resumed ... in the plaintiffs."
The decree was affirmed by His Majesty on appeal in March 1906, but when the order reached Australia the owners did not take any steps to enforce their rights as declared by the Court. It is obvious that under the decree it was open to the Government either to take the remainder of the land or to decline to resume the residue, and that in the latter event they became trustees of the portion resumed for the plaintiffs. That is to say, a duty of choice was imposed upon the Government: they were bound to adopt one or the other alternative. One would have supposed that under these circumstances some application would have been made in the suit by the plaintiffs to the Court under the liberty to apply, to compel the Government to elect which of the alternatives they would adopt. If they declined to resume the whole of the land, the trusts declared by the Court would come into operation and the plaintiffs would be entitled to a reconveyance. The plaintiffs, however, did not take that course, but in August 1906 they demanded that the Government should resume the remainder of the land, and after some delay, such as might be expected in a Government department, the Government in January 1907 definitely stated that they would not take the remainder. Thereupon the right of the plaintiffs became absolute to have the land taken reconveyed to them. The Government, when declining to resume the remainder of the property, offered at the same time to execute the necessary documents in order to revest the portion resumed in the plaintiffs. The plaintiffs did not accept that offer, but brought another suit, the one now before this Court. In the statement of claim, after setting out the facts, says par. 17, they contended that "considering the length of time which has elapsed since the resumption of the said portion, the material alterations and obstructions made therein and thereto, and to the foreshores thereof, and the vesting of the said portion as aforesaid in the Sydney Harbour Trust Commissioners," (which was a purely departmental matter, the Commissioners being the public body charged with the care of wharves at Sydney) "and the long-continued enjoyment thereof by the said Government or the said Commissioners, the said Government is not now entitled to revest the said portion in the plaintiffs, but are bound to resume the whole of the said property." Now, seeing that the rights of the parties had been fully litigated and finally disposed of by the decree in the first suit, which was afterwards affirmed by the Privy Council, it is difficult to understand how such a claim as that made by the plaintiffs can be put forward. It is entirely inconsistent with the view taken by the Supreme Court and the Privy Council. The rights of the plaintiffs were declared to be to have the land reconveyed to them. They refuse to accept that relief, and maintain that the Government are bound to resume the whole property. A difficult question might arise, if it were necessary to determine it, whether the Supreme Court could compel the Government to exercise a power vested in the Governor to be exercised with the advice of the Executive Council. It might be contended with force that the well known objections to the issue of a writ of mandamus against the Crown would apply to granting substantially the same relief in the form of a decree in a suit in equity. It is manifest that the Governor cannot be ordered to exercise a discretion in any particular way, and that the Executive Council cannot be ordered to give any particular advice. If any such claim could be supported, it would have to be founded upon something in the nature of a contract to be inferred against the Government by reason of their conduct. Whether such a contract could be set up with respect to a proceeding which was initiated on the resumption of land by Gazette notification may be very arguable. In England under the provisions for resumption of land by notice it has been held that, if, after a notice is given by an undertaking body of their intention to take a piece or part of land or house from the owner, and a counter-notice is given by the owner requiring the undertakers to take the whole or none, and the undertakers go into possession or continue in possession, a contract will be implied as against them to take the whole property. Whether such a contract can be implied in this State where the proceedings have been initiated by Gazette notification is a matter that may possibly some day, though it probably never will, arise for argument. In the present case there is absolutely nothing in the facts to raise any suggestion of an implied agreement by the Government to take the remainder of the land. They were not required by the plaintiffs to take it until practically all that was to be done on the portion taken had been done. The whole work had been practically completed. If there were no more in the case, and if the resumption had been by notice to the owners, there would be a great deal to be said against the implication of a contract. But the Government absolutely declined to do anything. They disputed the obligation to take the remainder, and asserted their readiness to reconvey the part taken. No change has taken place in the condition of the land from that time to the present day. The single fact that could be set up against the Government was that it was nearly six months after the opinion of the Privy Council had been pronounced before the Government said definitely that they did not intend to resume the residue, and made the offer to reconvey the portion resumed.
Under these circumstances it is, in my opinion, absolutely impossible to suggest that there is anything in the nature of a contract. It is not necessary, however, to determine that question, because the rights of the parties were definitely decided by the decree of the Supreme Court to be that in the events which have happened the Government or the constructing authority became trustee for the plaintiffs of the land resumed. The plaintiffs are entitled to what the Supreme Court declared them to be entitled to in 1902, and which has been offered to them since the decision of the Privy Council finally settled the question, and to no more. But in this suit they claim, first, a declaration that under the circumstances the Government were bound to resume the whole of the property known as "Bomera," and were not entitled to decline to resume the portion already attempted to be resumed and to revest it in the plaintiffs; or in the alternative that the Government were not entitled to decline to resume and revest the portion in the plaintiffs without restoring the land to its original condition, and removing the obstructions complained of, and paying compensation for use and occupation of the land and for the loss sustained by the plaintiffs by reason of being deprived of the land; or in the further alternative, that, if the Government were unable to restore the land to its original condition, they were not entitled to revest it in the plaintiffs without making the compensations referred to, and in addition, compensating the plaintiffs for the deterioration in value in the land owing to the alterations and obstructions mentioned. That, although put in the negative form, is really, if it means anything at all, a claim for compensation founded upon the position that the Government are trustees for the plaintiffs and have while trustees been guilty of something like waste. But that is entirely inconsistent with the whole case made by the statement of claim. There is no doubt that the Government or the constructing authority, being trustee for the plaintiffs, are in the events which have happened liable for anything in the nature of waste committed while the land was in their possession, and also, no doubt, liable to pay compensation to the plaintiffs for the use and occupation of their land. There may also be other claims, including a claim for damages for severance, but we are not in a position to say what is the precise nature of the relief to which the plaintiffs are entitled by reason of the fact of their land having been in the unauthorized occupation of the Government for a period of 6 or 7 years. No doubt they are entitled to obtain relief in some form. But this suit is not brought to enforce any such right. It may be that the plaintiffs are entitled to get all that relief by an application in the original suit under the liberty to apply, or, if not in that way, by a supplemental suit or some similar form of proceeding. But it would be entirely changing the character of this suit, and would involve setting up claims entirely new, if we were now to make any such amendment as would justify a decree giving the plaintiffs that relief. There is no evidence of any contract upon which the Court could formulate the terms of such an inquiry. Under these circumstances it seems to me that the suit has failed in its object and should be dismissed, without prejudice to any proceeding that the plaintiffs may be advised to take to enforce whatever claim they may have to relief. They are clearly entitled to some compensation for the use and occupation of their land by the Government, and for any injury done to the land by or during that occupation.
Barton J.
I am entirely of the same opinion.
Isaacs J.
I agree, and only wish to add a few words, and upon this basis that the argument for the respondents rested mainly upon the assumption that prior to the institution of the first suit the Government of the State had, in effect, so acted as to elect to take the whole property. Well, I will only say that a perusal of the statement of claim in the first suit will show that it is absolutely inconsistent with that assumption. That statement of claim is based upon the assumption, and it distinctly so states, that the Government had refused and declined to resume the balance of the land. And it was submitted on behalf of the plaintiffs that the defendant Minister did not hold the portion vested in him at all, and that was the basis of the suit and of the decree. On this I thoroughly agree with what has been said by the learned Chief Justice that nothing has happened since the decree in that case that can amount, in effect, to an election by the Government to take the rest of the land. That being so ends the matter. I wish also to say that I altogether reserve my opinion on the question whether if the facts were sufficient the law would presume an implied contract to have been made in that way. It is possible, but I offer no opinion whatever upon the subject.
Higgins J
Higgins J. read the following judgment:
—This is a curious action—in the main an action to compel the Government of New South Wales to take land which, by the decree of the Supreme Court, affirmed by the Full Court, and by the Privy Council, the Government had an election to take, or not to take as they saw fit. No doubt, the claim is based on facts which are alleged to have taken place during the pendency of the original suit (par. 12). But this is not framed as a supplemental suit; and, in any event, the facts alleged—except lapse of time—actually occurred before, not after 26th May 1902, the date of the commencement of the original suit.
We must take as a starting point the decree in the original suit, which, having been affirmed by the Privy Council, is binding on both parties and on this Court. The Supreme Court decided in favour of the plaintiffs, that sec. 131 of the Public Works Act 1900 applied in case of land taken compulsorily by Gazette notice under sec. 36 as well as in the case of land taken under "notice to treat" (sec. 41). The decree, therefore, declared that the Government is not entitled to resume that part of the plaintiffs' land which they wanted without resuming the whole; and that in the event of the Government declining to resume the residue of the land, the Minister—in whom that portion had been vested by Gazette notice—holds "that portion" in trust for the plaintiffs, and in that case the Minister is ordered to do all things necessary to revest it in the plaintiffs. It probably would have been better if the decree had fixed some date for the Government to elect to take all the land or none; but as no date was fixed, it was competent for the plaintiffs in the original suit to apply in that suit for an order fixing a date (Daniell's Chancery Practice, 6th ed., p. 876). What actually happened was that on 14th March 1906 the Privy Council dismissed the defendant's appeal; that on 8th August following the plaintiffs' solicitor wrote to the Premier calling on the Government to resume the whole of "Bomera" (the property in question), that on 4th January 1907 the Crown Solicitor wrote to the plaintiffs' solicitors to the effect that the Government had decided not to resume the whole of the property, and would revest the portion taken; and the plaintiffs instituted this new suit. No objection has been taken on behalf of the Government to this unusual and expensive course of enforcing rights under a decree; no motion was made for a stay of proceedings; and I am inclined to think that the irregular procedure adopted has tended to obscure the true position. The learned Judge below has decided in favour of the plaintiffs, that the Government are bound to resume the whole of "Bomera," and from that decision this appeal is brought.
I concur in the view that the reasons given for holding the Government bound to take the whole of "Bomera" are insufficient, and I need not criticise in detail the reasons which have already been criticised in the judgment of the Chief Justice. I cannot find anything in sec. 131 to justify the opinion that, where a portion of land is resumed by Gazette notice, the Government must be treated as having elected to resume the whole if called upon by the owner to do so. All that sec. 131 says in effect is:—"You—the Government—cannot resume a portion unless you resume all." It does not say "You must take all, if you resume, or attempt to resume, a portion." There is surely a clear distinction between a provision preventing the Government from taking a fraction, and a provision compelling the Government to take the integer. The Government certainly never consented to, or intended to, take the whole of the land; the Statute does not compel the Government to take it; and there are no facts to support an estoppel against the Government, preventing them from showing that they did not consent. I know of no ground other than a contract, a Statute, or perhaps estoppel, which could bind the Government to purchase. Besides, this is not the case made by the statement of claim. As I have stated, the statement of claim is based on acts alleged to have been done, but not done, since the original suit. The plaintiffs' view of sec. 131 is also inconsistent with the decree, which obviously implies that the Government were still in a position, notwithstanding that they had taken possession of the portion of land under the Gazette notice, to resume or not to resume the whole as they saw fit.
As for the alternative claims made in the prayer of the statement of claim, they are clearly impossible, on the grounds stated in the judgments already delivered. During the argument I thought that, if the plaintiffs insisted on it, they might be entitled in this suit under the prayer for other relief, secundum allegata et probata, to get compensation for any loss sustained by reason of the Government's interference with the land—the insertion of angle irons, &c.—that even if the plaintiffs could not prove the interference to have taken place after the original suit was commenced, still they could make the Government liable as trustees for injuring the trust property. The decree—rightly or wrongly, it is not for us to say now—declares the Minister to be a trustee of the portion resumed; and I presume that his trusteeship began at the vesting, the date of the Gazette notice, 14th November 1900. The compensation, if given, would have to be confined to any loss occasioned by physical interference with the land, and there would certainly have to be an inquiry in Chambers. But, on reconsideration, I do not think that we can, in this suit, properly order any such compensation. The allegations of paragraph 12 are clearly pointed to the blocking of access to the land,—the extension of the wharf, the securing of the extension by means of angle irons to the land, the filling in of the harbour with rubble, &c. Such blocking of access by these means is not a matter for which the Government is liable as trustee of the portion of land described in the Gazette notice, and we cannot say then in this suit whether the Government is liable otherwise or not. The proper course, in my opinion, is that already indicated to allow the appeal, and to dismiss the suit, without prejudice to any proceeding for compensation.
Appeal allowed. Judgment appealed from discharged. Suit dismissed with costs, without prejudice to any proceedings that the plaintiffs may be advised to take to recover compensation for injury.
Respondents to pay the costs of the appeal.
Solicitor, for the appellant, The Crown Solicitor for New South Wales.
Solicitor, for the respondents, C. A. Coghlan.