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Consolidated Pastoral Company Pty Ltd v Bellevue Station Pty Ltd[2023] QSC 202

Consolidated Pastoral Company Pty Ltd v Bellevue Station Pty Ltd[2023] QSC 202

SUPREME COURT OF QUEENSLAND

CITATION:

Consolidated Pastoral Company Pty Ltd v Bellevue Station Pty Ltd & Anor; Bellevue Station Pty Ltd v Consolidated Pastoral Company Pty Ltd [2023] QSC 202

PARTIES:

In BS No 16291/22:

CONSOLIDATED PASTORAL COMPANY PTY LTD

ACN 010 080 654

(applicant)

v

BELLEVUE STATION PTY LTD

ACN 653 783 094

(first respondent)

AND

NBT PTY LTD AS TRUSTEE FOR THE ASTOR SUPERANNUATION TRUST

ACN 001 945 446

(second respondent)

In BS No 76/23:

BELLEVUE STATION PTY LTD

ACN 653 783 094

(applicant)

v

CONSOLIDATED PASTORAL COMPANY PTY LTD

ACN 010 080 654

(respondent)

FILE NO/S:

BS No 16291/22

BS No 76/23

DIVISION:

Trial

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

1 September 2023

DELIVERED AT:

Brisbane

HEARING DATE:

20 March 2023

JUDGE:

Brown J

ORDER:

  1. Pursuant to s 10(2) of the Civil Proceedings Act 2011 (Qld), the Court declares that:
    1. a.
      the Deed of Assignment dated 9 December 2022 between Bellevue Station Pty Ltd and NBT Pty Ltd is of no effect at law;
    1. b.
      Bellevue Station Pty Ltd is not a party to, and cannot enforce the clauses contained within, the Give and Take Agreement between Consolidated Pastoral Company Pty Ltd and NBT Pty Ltd dated 18 December 2009 (2009 Give and Take Agreement); and
    1. c.
      clause 6 of the 2009 Give and Take Agreement does not require Consolidated Pastoral Company Pty Ltd to enter into a new agreement with Bellevue Station Pty Ltd on the same terms as the 2009 Give and Take Agreement.
  2. The Originating Application filed by Bellevue Station Pty Ltd on 9 January 2023 is dismissed.
  3. Bellevue Station Pty Ltd pay Consolidated Pastoral Company Pty Ltd’s costs of the application on the standard basis.

CATCHWORDS:

REAL PROPERTY – RESTRICTIVE COVENANTS – INTERPRETATION – where Consolidated Pastoral Company Pty Ltd (CPC) and Bellevue Station Pty Ltd (BPL) own and operate adjoining cattle properties in North Queensland, known as Wrotham Park and Bellevue Station respectively – where, in 2009, CPC entered into a give and take agreement with BPL’s predecessor in title whereby each gave the other rights of use over the other’s land – where the give and take agreement provided that if either party disposed of its land, it was to draw the attention of the incoming purchaser to the give and take agreement and have them enter into a similar arrangement with the continuing party – where, after the sale of Bellevue Station to BPL, CPC refused to enter into a new give and take agreement with BPL – where BPL seeks to enforce the give and take agreement against CPC – whether BPL is entitled to the benefit of covenants in the give and take agreement on the basis that the covenants run with the land at general law, in equity or through the deeming provisions of s 53 of the Property Law Act 1974 (Qld)

REAL PROPERTY – RESTRICTIVE COVENANTS – ASSIGNMENT OF COVENANT NOT ANNEXED TO LAND – where BPL and its predecessor in title entered into a deed of assignment which purported to assign the predecessor’s right, title, estate and interest in, to and under the give and take agreement to BPL – whether, pursuant to the deed of assignment, BPL has been assigned the benefits of the covenants in the give and take agreement

Property Law Act 1974 (Qld)

Land Act 1994 (Qld)

Bidjara Aboriginal Housing & Land Co Ltd v Bidjara Motor Corp Pty Ltd (in liq) [2005] QCA 196

Cape Flattery Silica Mines Pty Ltd v Hope Vale Aboriginal Shire Council [2012] QSC 381

Crest Nicholson Residential (South) Ltd v McAllister [2004] 1 WLR 2409

Electricity Generation Corporation v Woodside Energy Ltd & Ors (2014) 251 CLR 640

Eleven 17 Ocean Street Pty Ltd v Evangelista Pty Ltd; Eleven 17 Ocean Street Pty Ltd v TWM (QLD) Pty Ltd [2023] QCA 170

Federated Homes Ltd v Mill Lodge Properties Ltd [1980] 1 WLR 594

Forestview Nominees Pty Ltd v Perpetual Trustees WA Ltd (1998) 193 CLR 154

Forestview Nominees Pty Ltd v Perpetual Trustees (WA) Ltd (1996) 70 FCR 328

Gumland Property Holdings Pty Ltd v Duffy Bros Fruit Market (Campbelltown) Pty Ltd (2008) 234 CLR 237

Hyatt Australia Ltd v LTCB Australia Limited [1996] 1 Qd R 260

Kemp v Baerselman [1906] 2 KB 604

Leveraged Equities Ltd v Goodridge (2011) 191 FCR 71

McGuigan Investments Pty Ltd v Dalwood Vineyards Pty Ltd [1970] 1 NSWR 686

Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104

Pacific Brands Sport and Leisure Pty Ltd v Underworks Pty Ltd (2006) 149 FCR 395

P & A Swift Investments (a firm) v Combined English Stores Group PLC [1989] AC 632

Rural View Developments Pty Ltd v Fastfort Pty Limited [2011] 1 Qd R 35

Rogers v Hosegood [1900] 2 Ch 388

Sandhurst Trustees Ltd v Australian Country Cinemas Pty Ltd [2006] QSC 165

Shayler v Woolf [1946] Ch 320

Simmons v Lee [1998] 2 Qd R 671

Southport Memorial Club Inc v Returned and Services League of Australia (Queensland) Southport Sub-Branch Inc [2023] QCA 146

The Portland Downs Pastoral Company P/L & Ors v Bexalaw P/L (in liq) [2009] QSC 272

Tolhurst v Associated Portland Cement Manufacturers (1900) Ltd [1902] 2 KB 660

Tolhurst v Associated Portland Cement Manufacturers (1900) Ltd [1903] AC 414

Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107

COUNSEL:

D P de Jersey KC with J P Pemberton for the applicant in BS 16291/22 and the respondent in BS 76/23

N H Ferrett KC with D V Ferraro for the first respondent in BS 16291/22 and the applicant in BS 76/23

SOLICITORS:

Hamilton Locke for the applicant in BS 16291/22 and the respondent in BS 76/23

O'Shea & Partners Lawyers for the first respondent in BS 16291/22 and the applicant in BS 76/23

  1. [1]
    The ultimate question for the Court in the present dispute is whether a new owner of a cattle station can enforce an agreement, described as a give and take agreement, between the previous owner of the station and the owner of the adjoining station.
  2. [2]
    Consolidated Pastoral Company Pty Ltd (CPC) owns a commercial cattle breeding property known as “Wrotham Park”.  Bellevue Station Pty Ltd (BPL) purchased the adjoining property, a cattle property known as “Bellevue Station”, from NBT Pty Ltd (NBT) on 24 March 2022. Until the sale of Bellevue Station in March 2022, the adjoining landholders of Wrotham Park and Bellevue Station had, since at least 2006, operated under an agreement referred to as a give and take agreement.

2009 Give and Take Agreement

  1. [3]
    The give and take agreement relevant to the present application was entered into between NBT and CPC in December 2009 (2009 Give and Take Agreement), after CPC purchased Wrotham Park. The 2009 Give and Take Agreement was based on the give and take agreement entered into in 2006 by the previous owner of Wrotham Park and NBT.[1]
  2. [4]
    In simple terms, the 2009 Give and Take Agreement dispensed with the need for a fence between the two properties to follow the legal boundary and instead permitted NBT and CPC to access a portion of the other’s land which fell on either side of the natural boundary. 
  3. [5]
    The 2009 Give and Take Agreement is a relatively short and unsophisticated document.  Relevantly, it provides:
  1. 1.Party A owns “Bellevue”.  Party B owns “Wrotham Park”.
  1. 2.The terrain separating “Bellevue” and “Wrotham Park” is such that the parties have agreed that Party A is to have the use of the area of “Wrotham Park” which is identified on the attached sketch (AWP Use Land).  Party B is to have the use of the area of “Bellevue” which is identified on the attached sketch (BB Use Land).
  1. 3.This Agreement does not amount to surrender of title but simply an arrangement between neighbours under which both parties will benefit from the cost savings associated with the construction and maintenance of a “boundary” fence that follows a less rugged course than that of the legal boundary between “Bellevue” and “Wrotham Park”.
  1. 4.This Agreement may be terminated by either party upon the expiry of the current or any renewal term of:
  1.  the Crown lease of “Bellevue”; or
  1.  the Crown lease of “Wrotham Park”.

In such event, 12 months’ notice would be given by either party prior to the lease renewal date.

  1. 5.This Agreement may also be terminated by either Party A or Party B by giving 12 months’ notice in writing if the other party does not contribute equally to the costs of maintaining the fence referred to in Introduction 3.
  1. 6.In the event that either party disposes of its land, it will draw the attention of the incoming purchaser to this Agreement and have them enter into a similar arrangement with the continuing party.
  1. 7.Party A indemnifies Party B for any loss, liability or expense that Party B may incur as a result of the use of the AWP Use Land by Party A and its employees, agents, invitees or livestock in accordance with the agreement.
  1. 8.Party B indemnifies Party A for any loss, liability or expense that Party A may incur as a result of the use of the BB Use Land by Party B and its employees, agents, invitees or livestock in accordance with the agreement.

(underlining and emphasis added)

  1. [6]
    It is admitted that the AWP Use Land is part of Wrotham Park comprising Lot 255 on SP PH1919, title reference 17664137. It is subject to a rolling term lease, namely PH 9/255. 
  2. [7]
    It is further admitted that the BB Use Land is part of Bellevue Station comprising Lot 4636 on SP 275854, title reference 17664152.  The BB Use Land is subject to a rolling term lease, namely PH 9/4636.

Background Facts

  1. [8]
    There are cross-applications before the Court. BPL seeks various declarations that it has the ongoing benefit of cls 2, 6 and 8 of the 2009 Give and Take Agreement, as well as injunctive relief to restrain CPC from continuing its fencing. CPC seeks various declarations that CPC is not bound by the 2009 Give and Take Agreement and that the 2009 Give and Take Agreement cannot be enforced against it.
  2. [9]
    The facts are uncontentious. The parties agreed a statement of facts,[2] which is the factual basis upon which the applications proceeded.  The Court was not called upon to determine any questions of fact.
  3. [10]
    Clause 8.8 of the sale agreement for Bellevue Station between NBT and BPL dated 29 September 2021 (Sale Agreement) provided that:

“The Seller discloses, and the Buyer acknowledges, that:

  1.  the Seller and the registered owner of the neighbouring property to the Land, known as Wrotham Park, have entered into a written “Give & Take” agreement, the terms of which have been disclosed to the Buyer by the Seller; and
  1.  subject to the Buyer’s express right to terminate this Contract under clause 5.5(1), the Buyer will, as soon as practicable after Settlement, enter into a similar arrangement with the owner of Wrotham Park, and must not otherwise make any objection or claim compensation or delay settlement in respect of the agreement referred to in clause 8.8(1).”
  1. [11]
    As contemplated by cl 6 of the 2009 Give and Take Agreement and pursuant to cl 8.8 of the Sale Agreement, on 21 March 2022 BPL’s solicitors provided CPC with a give and take agreement executed by BPL and requested that CPC also execute the agreement.  CPC refused to sign the new give and take agreement with Bellevue Station. CPC does not wish to continue the 2009 Give and Take Agreement with Bellevue Station and contends it is not obliged to do so. 
  2. [12]
    CPC gave notice to BPL of its intention to fence along the boundary between the properties and sought BPL’s consent but not a monetary contribution.
  3. [13]
    Following CPC’s refusal to sign the give and take agreement provided to it by BPL, BPL and NBT entered into a deed of assignment in December 2009 (Deed of Assignment). On 12 December 2022, BPL sent a notice to CPC that NBT had assigned its interest in the 2009 Give and Take Agreement to BPL pursuant to the Deed of Assignment.
  4. [14]
    CPC contends that as the assignment did not have CPC’s consent, it was invalid and ineffective at law.
  5. [15]
    NBT was made a party to and served with these proceedings but has taken no active part in the proceedings. Nor did it appear on the day of hearing.
  6. [16]
    BPL has been using the AWP Use Land since it purchased Bellevue Station and has been running 820 cattle on that area of land. Mr Mark Neilson, who has been the station manager of Bellevue Station since 2011, deposes as to improvements made by NBT on the AWP Use Land, but that was not raised as a matter of significance in argument.
  7. [17]
    The matters for determination by the Court involved matters of construction and law.  
  8. [18]
    The principal issues for determination by the Court are:
    1. whether, notwithstanding the lack of privity of contract between CPC and BPL, BPL is entitled to the benefit of covenants in cls 2 and 8[3] of the 2009 Give and Take Agreement on the basis that they are covenants which “run with the land” at general law and in equity;
    2. alternatively, notwithstanding the lack of privity of contract, whether s 55 of the PLA operates to render the agreement enforceable against CPC by BPL as the beneficiary of the 2009 Give and Take Agreement; and
    3. alternatively, whether pursuant to the Deed of Assignment, BPL has been assigned the benefit of the covenants in the 2009 Give and Take Agreement and that is binding on CPC.

Parties’ Contentions

  1. [19]
    CPC contends that the covenants in the 2009 Give and Take Agreement are unenforceable by BPL against CPC for three principal reasons:
    1. first, there is no privity of contract between BPL and CPC because BPL is not a party to the 2009 Give and Take Agreement;
    2. secondly, whilst cl 6 of the 2009 Give and Take Agreement obliges NBT to inform BPL of the existence of the 2009 Give and Take Agreement and to have BPL enter into a new give and take agreement with CPC, it does not oblige CPC to enter into a new give and take agreement with BPL. Clause 6 instead evidences an intention that the promises contained in the 2009 Give and Take Agreement were personal and only between the named parties; and
    3. finally, NBT purported to assign its right, title, estate and interest in, to and under the 2009 Give and Take Agreement to BPL without CPC’s consent.  Given the 2009 Give and Take Agreement only provides for personal contractual rights, the “personal rights rule” was breached when the purported assignment was made and it follows that the assignment was invalid and has no effect at law.
  2. [20]
    It is uncontentious that there is no privity of contract between CPC and BPL. The doctrine of privity of contract provides that only parties to a contract benefit or are burdened by its terms and only parties to the contract may sue or be sued on the contract.[4]
  3. [21]
    BPL, however, contends that cls 2, 6, 7 and 8 of the 2009 Give and Take Agreement continued to be binding on CPC and BPL after the sale of Bellevue Stations on the basis that:
    1. (a)
      first, on its proper construction, BPL is entitled to the benefit of covenants in cls 2, 6, and 8 of the 2009 Give and Take Agreement, with CPC being entitled to the benefit of cls 2, 6 and 7, on the basis that they run with the land at general law, in equity or through the deeming provisions of s 53 of the PLA;
    2. (b)
      secondly, even if (a) does not apply, s 55 of the PLA operates as an exception to privity of contract rendering the 2009 Give and Take Agreement enforceable against CPC by BPL as the beneficiary; and
    3. (c)
      finally, further or in the alternative, that pursuant to the Deed of Assignment, BPL has been assigned the benefit of the covenants in the 2009 Give and Take Agreement.

Covenants that run with the land and s 53 of the PLA

  1. [22]
    The critical clauses to BPL are cls 2 and 8 of the 2009 Give and Take Agreement.
  2. [23]
    If the benefit of covenants in cls 2 and 8 of the 2009 Give and Take Agreement run with the land as BPL contends, the fact that CPC refuses to enter into a new give and take agreement would be of no moment. The common law recognises that the benefit of such covenants may be enforced against the original covenantor by a successor in title to the estate of the original covenantee.[5]
  3. [24]
    Strictly defined, a covenant is a promise made in a deed.[6]  The benefit of a covenant is the right to enforce the obligation in the covenant. The burden of the covenant is the obligation to perform the promise contained in the covenant. A restrictive covenant is a negative covenant, namely one which restrains the covenantor from doing some act, the benefit and burden of which runs with the land and is enforceable in equity.[7]
  4. [25]
    According to BPL, cl 2 of the 2009 Give and Take Agreement contains two covenants which are restrictive in substance because each party has agreed to restrict their own use of part of their own land for the benefit of the other party. According to BPL, the first covenant is a promise made by CPC to restrict its use of the AWP Use Land by allowing NBT to have the use of it. The second covenant is a similar promise made by NBT in relation to the BB Use Land. 
  5. [26]
    CPC contends that cl 2 contains a mixed benefit and burden covenant, which is a conditional benefit covenant by reason that the promise from CPC to permit access is impliedly conditional upon NBT providing access. On its proper characterisation, CPC contends that cl 2 contains a restrictive covenant in that it restricts the covenantor from denying access to the land.
  6. [27]
    CPC concedes that cl 2 is a covenant but not one that runs with the land.
  7. [28]
    At common law, the benefit of a covenant can run with the land so as to be enforceable by a successor in title to the original covenantee. The burden of a positive covenant generally does not run with the land, save in particular circumstances.[8]
  8. [29]
    In order for a covenant to be found to run with the land at common law, it must be shown that: [9]
    1. the covenant touches and concerns the covenantee’s land;
    2. there is an intention that the benefit of the covenant should run with the land; and
    3. the covenantee had a legal interest in the benefited land at the time the covenant was made.
  9. [30]
    For a covenant to touch and concern the land, it:[10]

“… must either affect the land as regards mode of occupation, or it must be such as per se, and not merely from collateral circumstances, affects the value of the land.”

  1. [31]
    In McGuigan Investments v Dalwood Vineyards, Hope J noted that:[11]

“In many cases the observance of the covenant is intended to and does benefit the relevant land because it enables the covenantee the better to enjoy his land, and in other cases the relevant land is benefitted because the observance of the covenant enhances the value of that land.”

  1. [32]
    In P & A Swift Investments (a firm) v Combined English Stores Group PLC (P & A Swift),[12] which was referred to by A Lyons J in Cape Flattery Silica Mines Pty Ltd v Hope Vale Aboriginal Shire Council (Cape Flattery),[13] Lord Oliver held that:

“Formulations of definitive tests are always dangerous, but it seems to me that, without claiming to expound an exhaustive guide, the following provides a satisfactory working test for whether, in any given case, a covenant touches and concerns the land. (1) The covenant benefits only reversioner for the time being, and if separated from the reversion ceases to be of benefit to the covenantee. (2) The covenant affects the nature, quality, mode of user or value of the land of the reversioner. (3) The covenant is not expressed to be personal (that is to say neither being given only to a specific reversioner nor in respect of the obligations only of a specific tenant). (4) The fact that a covenant is to pay a sum of money will not prevent it from touching and concerning the land so long as the three foregoing conditions are satisfied and the covenant is connected with something to be done on, to or in relation to the land.”

  1. [33]
    In Gumland Property Holdings Pty Ltd v Duffy Bros Fruit Market (Campbelltown) Pty Ltd, the High Court applied the criteria in P & A Swift in considering whether covenants in a guarantee of a lessee’s obligations touched and concerned the land.[14]
  2. [34]
    When introduced, s 53 of the PLA was said to automatically imply the intention that the covenant is to run with the land provided that the covenant touches and concerns the covenantee’s land.[15]  Relevantly, s 53 of the PLA provides that:

53 Benefit and burden of covenants relating to land

  1.  A covenant relating to any land of the covenantee shall be deemed to be made with the covenantee and the covenantee’s successors in title and the persons deriving title under the covenantee or the covenantee’s successors in title, and shall have effect as if such successors and other persons were expressed.
  1.  A covenant relating to any land of a covenantor or capable of being bound by the covenantor, shall, unless a contrary intention is expressed, be deemed to be made by the covenantor on behalf of the covenantor, the covenantor’s successors in title and the persons deriving title under the covenantor or the covenantor’s successors in title, and, shall have effect as if such successors and other persons were expressed.
  1. [35]
    At least in Queensland, notwithstanding that s 53 of the PLA refers to “relates to land” as opposed to “touch and concern the land”, which is the language used in the common law test, the same considerations apply as for the common law approach. In Simmons v Lee (Simmons v Lee), McPherson JA stated that:[16]

“The expression used in s. 53(1) is “relating to” and not, as in s. 117 of the Act, “touching and concerning” the land; but, although the verbiage of s. 53(1) differs in that respect, it has always been treated as requiring that the covenant sought to be enforced be one that in law touches and concerns land: see Federated Homes Ltd. v. Mill Lodge Properties Ltd. [1980] 1 W.L.R. 594, 604.”

  1. [36]
    According to McMurdo J in Rural View Developments Pty Limited v Fastfort Pty Ltd (Rural View Developments),[17] the section makes it unnecessary to refer to successors in title in the drafting of documents. The effect of the section is not displaced merely because there is no reference to successors or assignees given s 53(1) of the PLA “functions at the very least as a ‘word-saving provision’ by ‘deeming’ a covenant relating to land of the covenantee to be made with the covenantee and his successors in title …”.[18]
  2. [37]
    While s 53 of the PLA does not state that its operation is subject to a contrary intention, French J (with whom Einfeld J agreed) in Forestview Nominees Pty Ltd v Perpetual Trustees (WA) Ltd (Forest Nominees v Perpetual Trustees)[19] expressed the view, by way of obiter and of the equivalent Western Australian provision, that:[20]

“… the effect of the section is to deem the covenant to be made ‘with the covenantee and his successors in title and the persons deriving title under him or them’. This includes, by virtue of s 47(2), ‘owners and occupiers for the time being’. It may be accepted therefore that the section has the effect of deeming the covenant to be made with the lessees of the covenantee as well as with any successors in title. But to accept that the section has that effect which is plainly intended to be facultative does not mean that it operates to contradict the content of the covenant to which it applies.”

  1. [38]
    Several commentators consider that the better view is that the section will not supply an intention that the benefit is to run with the land when that is contrary to the express or implied terms of the covenant.[21]
  2. [39]
    CPC contends that this view is supported by English authorities such as Crest Nicholson Residential (South) Ltd v McAllister (Crest Nicholson Residential),[22] which considered that even though a provision similar to s 53 of the PLA, namely s 78 of the Law of Property Act 1925 (UK), did not refer to the operation of the provision being subject to a contrary intention being shown, it was implicit. In that case, Chadwick LJ (with whom Arden and Auld LLJ agreed), having referred to Brightman J in Federated Homes Ltd v Mill Lodge Properties Ltd,[23] stated:[24]

“Judge Paul Baker QC, sitting as a judge of the High Court, rejected that submission. After analysing the judgment of Brightman LJ in Federated Homes Ltd v Mill Lodge Properties Ltd [1980] 1 WLR 594, and pointing out that no reason of policy had been suggested to explain why section 78 of the 1925 Act should be mandatory, the judge said [1984] 1 WLR 40, 46:

‘… The true position as I see it is that even where a covenant is deemed to be made with successors in title as section 78 requires, one still has to construe the covenant as a whole to see whether the benefit of the covenant is annexed. Where one finds, as in the Federated Homes case, the covenant is not qualified in any way, annexation may be readily inferred; but where, as in the present case, it is expressly provided: ‘this covenant shall not enure for the benefit of any owner or subsequent purchaser of any part of the vendor's Sudbury Court Estate at Wembley unless the benefit of this covenant shall be expressly assigned …’ one cannot just ignore these words. One may not be able to exclude the operation of the section in widening the range of the covenantees, but one has to consider the covenant as a whole to determine its true effect. When one does that, then it seems to me that the answer is plain and in my judgment the benefit was not annexed. That is giving full weight to both the statute in force and also what is already there in the covenant.’

I respectfully agree, first, that it is impossible to identify any reason of policy why a covenantor should not, by express words, be entitled to limit the scope of the obligation which he is undertaking; nor why a covenantee should not be able to accept a covenant for his own benefit on terms that the benefit does not pass automatically to all those to whom he sells on parts of his retained land. As Brightman LJ pointed out, in the passage cited by Judge Paul Baker QC, a developer who is selling off land in lots might well want to retain the benefit of a building restriction under his own control. Where, as in Roake v Chadha [1984] 1 WLR 40 and the present case, development land is sold off in plots without imposing a building scheme, it seems to me very likely that the developer will wish to retain exclusive power to give or withhold consent to a modification or relaxation of a restriction on building which he imposes on each purchaser; unfettered by the need to obtain the consent of every subsequent purchaser to whom (after imposing the covenant) he has sold off other plots on the development land. I can see no reason why, if original covenantor and covenantee make clear their mutual intention in that respect, the legislature should wish to prevent effect being given to that intention.”

  1. [40]
    In my view, Chadwick LJ’s analysis is the correct one.
  2. [41]
    Section 49 of the PLA provides that a covenant implied under the PLA is to have the same force and effect as if it had been set out at length in the instrument in which it is implied save that it can be negatived, varied or extended by an express declaration in the instrument in which it is implied or another instrument. It has been held to apply to s 53 of the PLA.[25]
  3. [42]
    It is the first two requirements which are particularly in issue in the present case in determining whether the covenants in question run with the land.  There is no issue that at the time the covenant was made NBT held a legal estate in the land benefitted.

Do the covenants touch and concern the land?

  1. [43]
    According to BLP, cl 2 of the 2009 Give and Take Agreement is restrictive in substance because each landowner has agreed to restrict their own use of part of their own land for the benefit of the other. BPL contends that cl 2 affects the nature, quality, or mode of use or occupation of Bellevue Station because it provides for a realignment of the boundary between Bellevue Station and Wrotham Park, reduces the costs of construction and maintenance of the boundary fence, and permits the owner of Bellevue Station to have use of Wrotham Park land and vice versa.
  2. [44]
    Clause 3 of the Give and Take Agreement is not said to contain a covenant because it is an explanation of the purpose and effect of the 2009 Give and Take Agreement. Clauses 4 and 5 are said to be merely contractual rights of termination.
  3. [45]
    BLP contends that cls 6 and 8 of the 2009 Give and Take Agreement contain positive covenants.
  4. [46]
    BLP further contends that cl 6 affects the nature, quality, or mode of use of occupation of Bellevue Station because it obliges the party disposing of its property to draw the incoming purchaser’s attention to the 2009 Give and Take Agreement and requires the purchaser to enter into a similar arrangement with the continuing party, thus ensuring that the benefits of the 2009 Give and Take Agreement continue to bind successors in title.
  5. [47]
    Similarly, BLP contends that cls 7 and 8 of the 2009 Give and Take Agreement contain positive covenants which touch and concern the land because they affect the nature, quality and value of the land insofar as they provide a form of security to repair or rectify any damage caused by an owner of Wrotham Park or Bellevue Station using the other’s land and facilitates the proper and reasonable care of the land for each station by the other.
  6. [48]
    CPC does not dispute that cls 2, 6, 7 and 8 contain promises that might be characterised as covenants, although such a concession is made in the narrow sense, not in the sense that they touch and concern or relate to land. CPC, however, contends that the covenants in cls 2, 6, 7 and 8 are personal covenants enforceable only by parties to the 2009 Give and Take Agreement.
  7. [49]
    CPC contends that on the proper construction, the 2009 Give and Take Agreement manifests a clear intention that the covenants contained in it were personal in nature or, alternatively, not intended to survive a party disposing of the relevant land.
  8. [50]
    CPC contends that although cl 2 might benefit NBT by providing access to CPC’s land, when the 2009 Give and Take Agreement is construed as a whole it is clear that the promises contained in the agreement are between the parties to that agreement and are not promises which run with the land. If it were otherwise, CPC submits that it would not have been necessary to include cl 6 in the 2009 Give and Take Agreement because, once annexed, the benefit of a covenant “inheres in” the land and no further formality such as cl 6 would be required.[26] It contends that the inclusion of cl 6 demonstrates that it was the parties’ intention that the 2009 Give and Take Agreement would come to an end upon one party selling their land and that it was only for the continuing party to determine whether or not it would enter into a fresh agreement. Its inclusion clearly manifests that cl 2 was to be personal between the covenantee and covenantor. That is consistent with the 2009 Give and Take Agreement referring to the open-ended term use” in cl 2 and right of “use” being defined by reference to each party. In construing the 2009 Give and Take Agreement, the Court must, according to CPC, read all the words used in the agreement so as to render them harmonious with each other. 
  9. [51]
    Nor, according to CPC, does the language used in the 2009 Give and Take Agreement demonstrate any intention that the covenants should run with the land. No reference is made to anyone other than the immediate parties benefiting from the obligations in the agreement, such as by the phrase “benefit of all owners”. Nor are the parties defined to extend beyond CPC and NBT or the covenants said to endure with the land, such as by use of the phrase “for all time”.
  10. [52]
    As to cl 6 of the 2009 Give and Take Agreement, CPC contends that it does not benefit the covenantee’s land as it only benefits the continuing party to the 2009 Give and Take Agreement since it has the option whether to enter into a new agreement or not.
  11. [53]
    CPC contends the fact that cl 2 of the 2009 Give and Take Agreement is a personal obligation is further supported by cl 3, which CPC’s counsel describes as a machinery provision for cl 2 which contains the right. CPC contends that the language of cl 3 is reflective of the obligations being personal obligations, particularly in its reference to “simply an arrangement between neighbours”, not obligations that attach to land.
  12. [54]
    As to cls 7 and 8 of the 2009 Give and Take Agreement, CPC contends that neither permits the covenantee to better enjoy the land, increase its value or improve the nature, quality or mode of use of the land. CPC submits that they are indemnity clauses which are promises to compensate the other party in the event of any loss associated with their use of the land and, accordingly, are personal covenants.

Consideration

  1. [55]
    Pivotal to the question of any ongoing benefit from the 2009 Give and Take Agreement is whether or not cl 2 touches and concerns the land given it contains the provision as to use of land. 
  2. [56]
    The 2009 Give and Take Agreement is not burdened by detail and the Court in construing its particular clauses must have regard to the contract as a whole.
  3. [57]
    In Electricity Generation Corporation v Woodside Energy Ltd & Ors, the majority neatly summarised the relevant principles of construction in relation to a commercial contract as follows:[27]

“… The meaning of the terms of a commercial contract is to be determined by what a reasonable businessperson would have understood those terms to mean. That approach is not unfamiliar. As reaffirmed, it will require consideration of the language used by the parties, the surrounding circumstances known to them and the commercial purpose or objects to be secured by the contract. Appreciation of the commercial purpose or objects is facilitated by an understanding ‘of the genesis of the transaction, the background, the context [and] the market in which the parties are operating’. As Arden LJ observed in Re Golden Key Ltd, unless a contrary intention is indicated, a court is entitled to approach the task of giving a commercial contract a businesslike interpretation on the assumption ‘that the parties … intended to produce a commercial result’. A commercial contract is to be construed so as to avoid it ‘making commercial nonsense or working commercial inconvenience’.” (footnotes omitted)

  1. [58]
    Clause 2 of the 2009 Give and Take Agreement gives to each party, nominated as Party A and B, a right to use the land identified by reference to the sketch attached. As identified in the Statement of Facts, the AWP Use Land and BB Use Land are each subject to Crown leases which are described as rolling term leases. While CPC concedes that cl 2 is a covenant, it does not concede that it is a covenant “relating to land”.[28] The “use” is not designated in cl 2. According to CPC, that is significant as it supports the fact that cl 6 is to be construed as bringing the 2009 Give and Take Agreement to an end upon the sale of one of the stations to a new owner. According to CPC, the choice is then given to the existing owner to decide whether to enter into a new give and take agreement with the new owner, which prevents the existing owner from being saddled with the consequences of an incoming owner using the land for something different, including something dangerous of which the continuing owner would not be aware.
  2. [59]
    Having regard to the criteria outlined in P & A Swift:
    1. cl 2 benefits only the reversioner for the time being and if separated from the reversion ceases to be of benefit to the covenantee;
    2. although the language used is equivocal and even though it does not provide a point of access for Bellevue Station, cl 2 on its face arguably affects the mode of use or occupation of Bellevue Station insofar as it permits the covenantee to have a greater area available for its use than it would otherwise have and, in doing so, enables the covenantee to better enjoy its land. While it does not provide for a surrender of title, cl 2 does provide for a realignment of the boundary given the rugged nature of the land, which given the terms of cl 3, contemplates fencing on that basis. Prima facie, it is a covenant which can be characterised as touching and concerning the land, but the language used does not make the position clear;
    3. cl 2 is expressed to be used by Party A and Party B as defined in the 2009 Give and Take Agreement and is arguably personal to them, such that the third criterion, namely that the covenant it not expressed to be personal, may not be satisfied (which I discuss further below); and
    4. the covenant is not to pay a sum of money.
  3. [60]
    Thus, it is the third criterion which must be considered to determine if, when construed in the context of the 2009 Give and Take Agreement as a whole, cl 2 is a personal covenant which would exclude it from being a covenant which touches and concerns the land.
  4. [61]
    CPC’s contention as to the reference to “use” strengthening its construction of cl 6 is not compelling, for two reasons. First, there is no constraint in the meaning of “use” in the 2009 Give and Take Agreement which on CPC’s argument could mean that one of the parties could engage in a use that is dangerous during the life of the agreement. The contention that familiarity with the other party acts as a protection holds little weight. Secondly, the reference to “use” would be construed by reference to the factual matrix in existence at the time of entry into the 2009 Give and Take Agreement, in particular, the fact that the “use” of the AWP Use Land (and BB Use Land) would be confined to the use permitted under the pastoral lease.[29] That said, while it is therefore unlikely that the proposed use by the new owner would be dangerous, it is within the realms of possibilities that a pastoral use may be antagonistic to the way Wrotham Park uses or wishes to use its land.
  5. [62]
    CPC emphasises the language used in cl 3 of the 2009 Give and Take Agreement describing the arrangement as one between neighbours. Its “killer point” relies on cl 6 of the 2009 Give and Take Agreement. It contends that if cl 2 touched and concerned the land, there would be no need for clause 6 at all. The fact that there is provision for the incoming owner to be given notice of the agreement and being obliged to enter into a give and take agreement in similar terms is not necessarily inconsistent with the characterisation of cl 2 as being a covenant which touches and concerns the land. The presence of such a clause can be explained by the fact that while the benefit of such covenants will pass to a successive owner, that is not generally the case in relation to the burden of covenants. Further, the 2009 Give and Take Agreement contains other provisions such as with respect to termination which are not to be anything other than contractual.[30] However, the 2009 Give and Take Agreement does not oblige the continuing owner to enter into the new agreement. Clause 6 compels the property owner selling the land to cause the new purchaser to “enter into a similar arrangement with the continuing party” without compelling the existing owner to enter into such an arrangement with the new owner. That supports CPC’s contention that the 2009 Give and Take Agreement was intended by the parties to come to an end and a new give and take agreement entered into at the election of the existing owner, and that the use in cl 2 was only intended to be enjoyed by the parties to the 2009 Give and Take Agreement.
  6. [63]
    There is, however, no reference in cl 6 to termination of the 2009 Give and Take Agreement, which is expressly referred to in cls 4 and 5.
  7. [64]
    BPL contends that given there are express provisions for termination in cls 4 and 5 of the 2009 Give and Take Agreement, CPC’s construction should be rejected. Clause 6 contains no reference to termination and the length of notice provided in cls 4 and 5 to effect termination of the 2009 Give and Take Agreement supports the fact that cl 6 was not intended to bring the 2009 Give and Take Agreement to an end but the fact that the 2009 Give and Take Agreement is a long-term agreement unrelated to who the actual owners of Bellevue Station and Wrotham Park are, given Crown leases continue force. It contends that cl 6 was intended to avoid unnecessary disputes about whether the 2009 Give and Take Agreement was binding if there was a subsequent purchaser by imposing an obligation upon the existing owner to cause the subsequent purchaser to procure a further agreement and that cl 6 ensures notice occurs.
  8. [65]
    However, cls 4 and 5 provide the parties to the 2009 Give and Take Agreement with a right to terminate in the circumstances set out in those clauses, one circumstance being where the term of the relevant Crown pastoral lease was about to expire and the other where a party failed to share in the costs of maintaining the fence contemplated by cl 3. Both are consistent with the same parties continuing to own Bellevue Station and Wrotham Park but provision being made to bring the agreement between them to an end. Clause 6, however, imposes no obligation upon the continuing owner to enter into a similar give and take agreement and entitles the continuing owner to elect whether or not to continue with a give and take agreement. It does not provide for the parties to enter into an agreement whereby the new owner agrees to be bound by the 2009 Give and Take Agreement. It provides for a new agreement to be entered into albeit in similar terms.
  9. [66]
    Clause 2 is not in my view a covenant which touches and concerns the land because:
    1. (a)
      cl 2 in its terms provides for the use of AWP Use Land and BB Use Land specific to Party A and Party B respectively;
    2. (b)
      when construed with cl 6, it is plain that cl 2 is a personal covenant for the benefit of CPC and NBT only; and
    3. (c)
      cl 3 is more consistent with cl 2 being a personal covenant. Clause 3 notably provides that the 2009 Give and Take Agreement is “simply an arrangement between neighbours under which both parties will benefit from … cost savings” and highlights the fact that the use in cl 2 is a matter of convenience to avoid expense in carrying out fencing in difficult terrain.
  10. [67]
    I consider that a reasonable businessperson would construe cl 2 in light of cls 3 and 6 as providing a right of use to CPC and NBT to use the other’s land which is personal to each of them and which use only endures until the land is sold.  While the new buyer might have an expectation and hope that the arrangement would continue, cl 6 makes it plain that the continuing owner is not obliged to continue with the arrangement.
  11. [68]
    While cls 7 and 8 provide for an indemnity in relation to the reciprocal use of the land, that is a broad indemnity for “any loss, liability or expense” that the other party may incur as a result of the use of the land and is not confined to damage or destruction of the land as was the case in Cape Flattery. Given the width of the indemnity, I am not satisfied that it affects the nature, quality, or mode of use or value of the land such that either clause touches or concerns the land. The clause goes well beyond providing for any restoration of the land due to any damage incurred. Further, there is nothing to suggest that the indemnities contained in the clauses are intended to endure beyond the sale of one of the stations which affects the construction of cl 2 or the characterisation of “use”.
  12. [69]
    While cl 2 does affect the use of the land which prima facie would fall within the category of covenants touching and concerning the land, I am ultimately persuaded that the proper construction of the 2009 Give and Take Agreement is that the benefit of the use of the land in Wrotham Park contained in cl 2 is not a covenant relating to land.
  13. [70]
    Given my construction of cls 2 and 6, I find that they are not covenants which touch and concern the land and enforceable by BPL. Given this finding, it is strictly unnecessary for me to decide whether cl 8 touches and concerns the land but I have for the reasons above concluded it is not.
  14. [71]
    Thus, I accept that if on their proper construction the benefit of cls 2 and 6 was only intended to be for the specific parties to the 2009 Give and Take Agreement and was intended to cease upon either Wrotham Park or Bellevue Station being sold, that would be sufficient to negate the implication of s 53 of the PLA.

Intention that covenant should run with the land

  1. [72]
    Given my finding above, it is not necessary to consider the second requirement. A covenant must touch and concern the land before the question of intention arises for consideration.[31] However, I will address it briefly.
  2. [73]
    There is nothing express in 2009 Give and Take Agreement suggesting that the benefit of the covenant was to NBT’s successor in title.
  3. [74]
    The lack of the inclusion of such wording is not, however, definitive. As is evident from Simmons v Lee and Rural View Developments, s 53 of the PLA can operate as a word-saving device where there is no express intention that the covenant is to run with the land.
  4. [75]
    BPL further contends that there is no express declaration that s 53 of the PLA would not operate as required by s 49(2) of the PLA.
  5. [76]
    CPC, however, contends that cl 6 of the 2009 Give and Take Agreement provides a clear contrary intention to the benefit of cl 2 running with the land. By its inclusion, CPC claim that the intention was that:
    1. the covenant was not intended to enure for the benefit of the covenantee’s land;
    2. any successors in title would be required to enter into a further personal agreement with the continuing party; and
    3. cl 6 preserve the continuing party’s right to decide whether it wishes for the arrangement to continue pursuant to a new personal agreement with the successor in title, in circumstances where the continuing party would not have been dealing with the party and is unlikely to know how they intended to use the land.
  1. [77]
    BPL further contends that even if there is a contrary intention to be implied from the terms of the 2009 Give and Take Agreement that is insufficient to constitute an express declaration which negatives the covenant implied by s 53 of the PLA as required by s 49(2) of the PLA. Further, BPL contends that the lack of a correlative agreement for the existing owner to enter an agreement with the new purchaser is the result of inexpert drafting rather than being indicative of the parties’ intention. I do not accept that to be the case. Clause 6 clearly provides only for a new agreement to be offered by the incoming purchaser. No provision is made, for instance, for the new purchaser to agree to be bound by the 2009 Give and Take Agreement. The clause is clear on its face in that regard and insufficient to imply an obligation upon the continuing owner to execute the new agreement. I consider that cl 6 is intended to offer a deliberate choice to the continuing owner whether to continue the arrangement or not, rather than being the result of inelegant drafting.
  1. [78]
    Even if CPC’s construction is correct, BPL contends that is not enough to negate the effect of s 53 of the PLA because it is not an express declaration contemplated by s 49 of the PLA, nor does s 53(1) refer to being subject to contrary intention as is the case for s 53(2).
  2. [79]
    CPC submits that it is enough if there is a contrary intention implied on the proper construction of the 2009 Give and Take Agreement rather than there being an expressed declaration. In that regard, the authors of Property Law and Practice Qld recognised the difficulties in the construction of s 49(2) of the PLA and the alternative interpretations that are available.[32] They contend, however, that the weight of authority in relation to similar provisions favours a reading by which a direct inconsistency between an express provision of an instrument and an implied covenant or power is sufficient to negative, vary or extend an implied covenant. In that respect, they say that is consistent with the general law rule that an express covenant upon particular matters excludes the implication of any covenant on the same matter.
  3. [80]
    As stated above, I consider the analysis of Chadwick LJ in Crest Nicholson Residential and the majority decision in Forestview Nominees v Perpetual Trustees, to which I have referred above, are correct in their analysis and that s 53(1) of the PLA will not operate to deem an intention that the benefit is to run with the land where that would be contrary to express or implied terms of the covenant concerned.  The threshold requirements for the implication of the covenant pursuant to s 53 of the PLA are first that it relates to land and secondly that there is not a contrary intention that the benefit was intended to run with the land on the correct construction of the agreement as a whole, notwithstanding that s 53(1) does not refer to “unless a contrary intention is expressed”. In the present case, I have found neither of the requirements are satisfied.
  4. [81]
    While that is sufficient to conclude that the benefit of any of the covenants run with the land, I consider that such a contrary intention is sufficient to negative the covenant implied by s 53 and constitute an “express declaration” for the purpose of s 49(2) of the PLA.
  1. [82]
    Consistent with the reasoning in determining that the covenants did not touch and concern the land, I find that the covenants in question were not intended to benefit successors in title but rather that the covenants under the 2009 Give and Take Agreement did not survive the sale of one of the properties and any successor would be required to enter into a further agreement with the continuing owner which would be at the election of the continuing owner.
  1. [83]
    I find that s 53(1) of the PLA does not deem cl 2 to run with the land because the 2009 Give and Take agreement manifests a contrary intention given the presence of cl 6 and terms of cl 3.

Are the covenants enforceable in equity?

  1. [84]
    BPL contends that the benefit of the covenants would run with the land in equity.
  2. [85]
    CPC contends that cl 2 of the 2009 Give and Take Agreement, while cast in positive form in the sense of providing access to a portion of the land, is properly construed as a negative or restrictive covenant because it restricts the covenantor from denying access to the land. A restrictive covenant is enforceable in equity if it satisfies a number of requirements.[33] BPL has not argued that the covenants are enforceable on the basis that they were restrictive covenants. It was not a matter the subject of any oral argument by either party.
  1. [86]
    BPL contended that if the 2009 Give and Take Agreement was effective at law it would be effective in equity. This argument may be shortly disposed of given my findings above. For the same reasons that I have found that the covenants do not run with the land at law, the contention that the covenants are annexed to the land in equity must fail.
  1. [87]
    In equity, the benefit of a covenant (whether positive or restrictive) may run with the land so as to be enforceable by a successor in title to the original covenantee. The benefit will pass where there has been annexation of the benefit of the covenant to the land. Annexation will occur if the following requirements are satisfied:[34]
    1. the covenant must touch and concern or benefit the land of the covenantee;
    2. the covenantee must own the benefited land at the time the covenant is made;
    3. the covenant must be intended to benefit the land of the covenantee; and
    4. the land benefited must be identified or identifiable.
  2. [88]
    It is uncontentious that the principles relating to whether a covenant touches and concerns the land are generally the same considerations as for a covenant to touch and concern the land at common law.[35] Section 53 of the PLA will also imply the requisite intention required by the third element unless there is a contrary intention.
  3. [89]
    For the same reasons as set out above, the covenants are not satisfied as they do not touch and concern or benefit the land of the covenantee, and the benefit of the covenant was not intended to run with the land.
  4. [90]
    I am therefore not satisfied either in law or in equity that covenants in cls 2 and 6 do not run with the land. As I stated above, given that finding, it is unnecessary to consider the position with respect to cls 7 and 8.

Section 55 of the PLA

  1. [91]
    In the event that the covenants are not found in law or equity to run with or be annexed to Bellevue Station, BPL claims that the 2009 Give and Take Agreement contains promises which are enforceable by BPL pursuant to s 55 of the PLA. It contends that cls 2, 6 and 8 of the 2009 Give and Take Agreement are therefore enforceable pursuant to s 55(1) of the PLA.
  2. [92]
    Section 55(1)–(3) of the PLA provides that:

55 Contracts for the benefit of third parties

  1.  A promisor who, for a valuable consideration moving from the promisee, promises to do or to refrain from doing an act or acts for the benefit of a beneficiary shall, upon acceptance by the beneficiary, be subject to a duty enforceable by the beneficiary to perform that promise.
  1.  Prior to acceptance the promisor and promisee may, without the consent of the beneficiary, vary or discharge the terms of the promise and any duty arising from it.
  1.  Upon acceptance—
  1.  the beneficiary shall be entitled in the beneficiary’s own name to such remedies and relief as may be just and convenient for the enforcement of the duty of the promisor, and relief by way of specific performance, injunction or otherwise shall not be refused solely on the ground that, as against the promisor, the beneficiary may be a volunteer; and
  1.  the beneficiary shall be bound by the promise and subject to a duty enforceable against the beneficiary in the beneficiary’s own name to do or refrain from doing such act or acts (if any) as may by the terms of the promise be required of the beneficiary; and
  1.  the promisor shall be entitled to such remedies and relief as may be just and convenient for the enforcement of the duty of the beneficiary; and
  1.  the terms of the promise and the duty of the promisor or the beneficiary may be varied or discharged with the consent of the promisor and the beneficiary.
  1. [93]
    BPL contends that having regard to cl 6 and s 53(2) of the PLA, the promise in cl 2 as to NBT using AWP Use Land on Wrotham Park is “plainly not only for the benefit of the NBT but NBT’s successor in title”. Consideration was provided by NBT in agreeing to provide use of BB Use Land to CPC, promises to do things in cl 6 if it were to dispose of the land, and by providing an indemnity to CPC in cl 7 in the same terms as CPC’s indemnity in relation to BB Use land.
  2. [94]
    According to BPL, the promises in each of cls 2, 6 and 8[36] were accepted by BPL executing the Sale Agreement, which contained cl 8.8 acknowledging the existence of the 2009 Give and Take Agreement, and agreeing to enter into a similar arrangement with CPC which it offered to do by providing an executed give and take agreement to CPC on 21 March 2022.
  3. [95]
    One of the key requirements in s 55(1) of the PLA is that there is a promise to “do or to refrain from doing an act for the benefit of a beneficiary”. Further, the parties to the contract must intend the promise to create a duty enforceable by a beneficiary, namely in this case, the purchaser of Bellevue Station.[37]
  4. [96]
    In the present case, given that I have found that cl 2 is a personal covenant, it does not contain a promise to provide the use of AWP Use Land to BPL. Clause 6 does not provide any promise which was intended to benefit any successor to NBT or capable of creating a duty enforceable by BPL given that whether or not the new agreement is accepted is a matter of election by the continuing owner. Nor do cls 2 and 6 of the 2009 Give and Take Agreement contain a promise “to do or refrain from doing an act for the benefit of a beneficiary”.
  5. [97]
    I am not satisfied that the clauses of the 2009 Give and Take Agreement could reasonably be construed as containing a promise to create an enforceable right by a subsequent purchaser as beneficiary to sue on the 2009 Give and Take Agreement.[38] It contemplated rights to be created under a new agreement and only if the continuing owner agreed to it.
  6. [98]
    BPL contends that there is nothing wrong with the 2009 Give and Take Agreement bestowing a right to have a new agreement.  However, that is not the content of the promise contained in cl 6. It bestows no such right. The continuing owner is not obliged by the terms of cl 6 to agree to such an agreement. That may have been the case had the 2009 Give and Take Agreement contained a promise that the continuing owner would enter into a similar agreement with the purchaser or agree to be bound by the terms of the 2009 Give and Take Agreement in favour of a third party, but that is not the case.
  7. [99]
    There is no promise in cls 2, 6 or 8 of the 2009 Give and Take Agreement upon which the alleged beneficiary, BPL, could sue. There is, by the inclusion of cl 6, no enforceable right by a subsequent purchaser as beneficiary upon which they could sue. The agreement contemplates that a new agreement would be entered into.
  8. [100]
    Moreover, the contention that there was acceptance of any promise by the beneficiary of the promise, BPL, by executing the Sale Agreement containing cl 8.8 or executing a new give and take agreement must fail. Such an act does not constitute an acceptance of a benefit under an existing agreement given it contemplates BPL offering to enter into a new agreement.
  9. [101]
    The inclusion of cl 6 in the 2009 Give and Take Agreement demonstrates that it was not the contractual intention of NBT and CPC that the beneficiary be able to sue on any of the promises said to be contained in cls 2, 6 and 8 of the 2009 Give and Take Agreement, but rather that a new agreement would be entered into in the circumstances outlined in cl 6.  There was no benefit to BPL under the 2009 Give and Take Agreement to accept. The circumstances in the present case in this respect are in direct contrast to those discussed in The Portland Downs Pastoral Company P/L & Ors v Bexalaw P/L (in liq)[39] and Hyatt Australia Ltd v LTCB Australia Limited.[40]
  10. [102]
    The promises made by CPC in cls 2, 6 and 8 of the 2009 Give and Take Agreement are not enforceable by BPL pursuant to s 55 of the PLA. BPL’s claim in reliance on s 55 of the PLA must therefore fail.

Were NBT’s interests under the 2009 Give and Take Agreement assigned to BPL?

  1. [103]
    After CPC refused to enter into a give and take agreement with BPL, BPL and NBT entered into the Deed of Assignment by which NBT purported to assign its interests under the 2009 Give and Take Agreement to BPL. It gave notice to CPC of the purported assignment on 12 December 2022.  The benefit of a covenant is a legal chose in action and is assignable in accordance with the statutory requirements set out in s 199 of the PLA. BPL contends that it has met all statutory requirements such that the benefit of the right, title, estate and interest of NBT in, to or under the 2009 Give and Take Agreement has been assigned to BPL. BPL contends that CPC’s consent was not required.
  2. [104]
    Pursuant to s 199(1) of the PLA:

199 Statutory assignments of things in action

  1.  Any absolute assignment by writing under the hand of the assignor (not purporting to be by way of charge only) of any debt or other legal thing in action, of which express notice in writing has been given to the debtor, trustee or other person from whom the assignor would have been entitled to claim such debt or thing in action, is effectual in law (subject to equities having priority over the right of the assignee) to pass and transfer from the date of such notice—
  1.  the legal right to such debt or thing in action; and
  1.  all legal and other remedies for the same; and
  1.  the power to give a good discharge for the same without the concurrence of the assignor.
  1. [105]
    BPL contends that NBT’s rights were assignable under the 2009 Give and Take Agreement because:
    1. cls 2, 6 and 8 are all covenants, the benefits of which are assignable at law and may be enforced by BPL (as assignee) against the original covenantor (CPC);63
    2. the entirety of NBT’s contractual rights in the 2009 Give and Take Agreement are prima facie assignable and there is nothing which precludes assignment;
    3. there is no express prohibition on assignment in the 2009 Give and Take Agreement; and
    4. the contractual rights are not personal to the parties to the 2009 Give and Take Agreement. So much is evident in cl 6 of the 2009 Give and Take Agreement and in the nature of the covenants in cls 2, 6 and 8 touching and concerning the land.
  2. [106]
    BPL identified the correct approach to the question of whether rights under a contract can be assigned to be as outlined by Finn and Sundberg JJ in Pacific Brands Sport and Leisure Pty Ltd v Underworks Pty Ltd (Pacific Brands):[41]

“In consequence we consider that the proper approach to be taken is that (i) all of a party’s contractual rights, being parts of a chose in action, have a proprietary character for assignment purposes and are prima facie assignable but (ii) whether in a given case they or some of them are unassignable will depend upon whether there is a reason which nonetheless precludes assignment. Apart from prohibitions created by statute or public policy, the most common such reasons will be a contractual prohibition on assignment, the materiality of the identity of the obligee to the contractual relationship or to the obligor’s performance, or, less commonly, in the case of an assignment of a part of a composite chose, the various rights are not separable in the manner attempted. We would add that we consider that this approach not only is more likely to engender greater certainty in routine commercial dealings where assignments are the common place than that adopted by the primary judge, but also it avoids what we consider to be a process of characterisation fraught with uncertainty.”

  1. [107]
    In Pacific Brands, Finn and Sundberg JJ held that considered in its totality, the sublicence was intended to create an enduring relationship in which the identity of the sub-licensor was material. In considering that question, their Honours at [59] stated that:

“It characteristically is said that it is a question of construction whether a contract itself or particular rights or obligations, involve personal considerations such as to render the contract or those rights unassignable, or the obligations not delegable: see eg Tolhurst v Associated Portland Cement Manufacturers (1900) Ltd [1903] AC 414 at 416-417; National Carbonising Co Ltd v British Coal Distillation Ltd (1936) 54 RPC 41 at 54; Australis Media Holdings Pty Ltd v Telstra Corp Ltd (1998) 43 NSWLR 104 at 118-120; see also Furmston (ed), 6.299, 6.301-6.324; Chitty on Contracts, [19-053]; cf Cheshire & Fifoot's Law of Contract, [8.6]. However, given the particular purpose for which the contract and its terms are being construed, implicit in the question of construction are, ordinarily, issues of characterisation and of inference in which the significance to be attributed, variously, to identity, to the qualities or attributes one or both parties are expected to exhibit and to the character of the parties’ relationship, can loom large.”

  1. [108]
    There is no dispute that the formal requirements under s 199 of the PLA have been met.
  2. [109]
    CPC contends, however, that the Deed of Assignment was invalid because CPC’s consent was not sought for the assignment which was required because the rights under the 2009 Give and Take Agreement are personal rights and were therefore not assignable without its consent. In that regard, it again relies on its submissions as to cl 6 to demonstrate that it a matter for the continuing owner to determine whether it will enter into a new give and take agreement with the purchaser. It further submits that it makes a difference to CPC, as the obligor, to whom it discharges its obligations under the 2009 Give and Take Agreement. BPL, however, contends that there is nothing in the 2009 Give and Take Agreement that makes it plain that the benefit of, for example, the use of CPC’s land in cl 2, depended on that being enjoyed by NBT as opposed to the current owner of the Bellevue Station. It contends that the contractual rights are not personal to the parties and that so much is evident in cl 6 of the 2009 Give and Take Agreement in the nature of the covenants in cls 2, 6 and 8 touching and concerning the land.
  3. [110]
    A contractual obligation cannot be assigned in cases where the identity of the person to whom the obligation is owed is a matter of importance to the person on whom the obligation rests.[42] It is a matter of construction whether the rights and obligations are personal in nature and the Court is required to determine the contractual intention by construing the entire contract in light of its surrounding circumstances and subject matter.[43]
  4. [111]
    Consistent with my reasoning above, I find that the inclusion of cl 6 demonstrates that the 2009 Give and Take Agreement provides for personal rights specific to the identities of the parties. By providing for the continuing party to have a choice whether to enter into a fresh give and take agreement, the parties ascribed the identity of the parties as being of significance to the 2009 Give and Take Agreement and recognised that the continuing party will not necessarily be willing to continue the agreement with the new owner.[44] That is supported by the reference to the identity of the parties enjoying the use in cl 2. The fact that cl 3 emphasises that the 2009 Give and Take Agreement is “simply an arrangement between neighbours” lends further support to the identity of the parties as existing neighbours being a matter of importance. Given that the 2009 Give and Take Agreement permits access to use the other landowner’s land, the identity and nature of the proposed use of the land by a new purchaser, even if pastoral, could be significant to the ongoing landowner’s operations. While I consider that the use would be confined to those for a pastoral lease, the use is otherwise unconstrained in terms of the prescribed use and may be contrary to CPC’s interests. It is uncontentious that the AWP Use Land on Wrotham Station is good grazing land for cattle, in which case the identity of the new owner would be significant in circumstances where no fence has been erected.[45] To construe the 2009 Give and Take Agreement otherwise would defeat the purpose of including cl 6 in the agreement and providing the continuing owner with a right to decide whether it will continue the agreement. 
  5. [112]
    Given the personal nature of the contractual rights, I find that they could not be assigned without CPC’s consent. In the circumstances, the purported assignment was invalid.

Orders

  1. [113]
    In the circumstances, BPL’s application is dismissed, and the declarations contained in the draft order proposed by CPC are appropriately made. There is no reason that costs should not follow the event. I will make the order in accordance with the draft.

Footnotes

[1] There was an informal, unwritten give and take agreement between the former owners of Bellevue Station and Wrotham Park.

[2] Exhibit 2.

[3] And that CPC is entitled to the benefit of cl 2 as well. While CPC did not submit that it required declarations as to cls 6 and 7 of the 2009 Give and Take Agreement in oral address, such declarations are contained in paragraphs [1(d)] and [1(e)] of the Originating Application in recognition of the reciprocal nature of the rights.

[4] See the discussion in Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107.

[5] Forestview Nominees Pty Ltd v Perpetual Trustees WA Ltd (1998) 193 CLR 154 at [23].

[6] C McDonald, L McCrimmon and A Wallace, Real Property Law in Queensland (Thomson Reuters, 4th ed, 2015) at [17.20]. See also P Butt, Land Law (Thomson Reuters, 6th ed, 2010) at [17.02], although the author uses it in the sense of an obligation affecting a landowner.

[7] C McDonald, L McCrimmon and A Wallace, Real Property Law in Queensland (Thomson Reuters, 4th ed, 2015) at [17.20].

[8] Rural View Developments Pty Ltd v Fastfort Pty Limited [2011] 1 Qd R 35 at [15] (per McMurdo J).

[9] Rogers v Hosegood [1900] 2 Ch 388 at 395; McGuigan Investments Pty Ltd v Dalwood Vineyards Pty Ltd [1970] 1 NSWR 686 at 690.

[10] Rogers v Hosegood [1900] 2 Ch 388 at 395.

[11] [1970] 1 NSWR 686 at 690.

[12] [1989] AC 632 at 642.

[13] [2012] QSC 381 at [41].

[14] (2008) 234 CLR 237 at [95]–[103]. See also Southport Memorial Club Inc v Returned and Services League of Australia (Queensland) Southport Sub-Branch Inc [2023] QCA 146 at [25].

[15] C McDonald, L McCrimmon and A Wallace, Real Property Law in Queensland (Thomson Reuters, 4th ed, 2015) at [17.80]; Federated Homes Ltd v Mill Lodge Properties Ltd [1980] 1 WLR 594 at 605.

[16] [1998] 2 Qd R 671 at 674 (with whom Thomas J and Dowsett J agreed). Left open in Forestview Nominees Pty Ltd v Perpetual Trustees WA Ltd (1998) 193 CLR 154 at 171.

[17] [2011] Qd R 35 at 40.

[18] Simmons v Lee [1998] 2 Qd R 671 at 677 (per McPherson JA).

[19] (1996) 70 FCR 328 at 333–44.

[20] Section 47 of the Property Law Act 1969 (WA). The question was not considered by the High Court.

[21] C McDonald, L McCrimmon and A Wallace, Real Property Law in Queensland (Thomson Reuters, 4th ed, 2015) at [17.90]; P Butt, Land Law (Thomson Reuters, 6th ed, 2010) at [17.35].

[22] [2004] 1 WLR 2409 at 2425–27.

[23] [1980] 1 WLR 594 at 602–3.

[24] [2004] 1 WLR 2409 at [40]–[41] (although the definition of successor in title differed from the present, referring to “the owners and occupiers of the time being of the land of the covenantee intended to be benefited”).

[25] Cape Flattery Silica Mines Pty Ltd v Hope Vale Aboriginal Shire Council [2012] QSC 381 at [36]–[37].

[26] Rogers v Hosegood [1900] 2 Ch 388 at 407.

[27] (2014) 251 CLR 640 at [35]. See also Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at [46]–[51].

[28] PLA s 53.

[29] Exhibit MAN-1 to the Affidavit of Mark Allan Neilsen filed 3 March 2023 (CFI 3 in BS No 76/23) at 60; Land Act 1994 (Qld) s 199A.

[30] Cf Eleven 17 Ocean Street Pty Ltd v Evangelista Pty Ltd; Eleven 17 Ocean Street Pty Ltd v TWM (QLD) Pty Ltd [2023] QCA 170 at [28(d)] and [28(e)].

[31] Federated Homes Ltd v Mill Lodge Properties Ltd [1980] 1 WLR 594 at 605.

[32] W Duncan and R Vann, Thomson Reuters, Property Law and Practice Qld (online at 29 August 2023) [49.20].

[33] C McDonald, L McCrimmon and A Wallace, Real Property Law in Queensland (Thomson Reuters, 4th ed, 2015) at [17.230].

[34] C McDonald, L McCrimmon and A Wallace, Real Property Law in Queensland (Thomson Reuters, 4th ed, 2015) at [17.300]; P Butt, Land Law (Thomson Reuters, 6th ed, 2010) at [17.59]–[17.66].

[35] As to which, see in the context of a restrictive covenant: Sandhurst Trustees Ltd v Australian Country Cinemas Pty Ltd [2006] QSC 165 at [26].

[36] First Respondent/Applicant’s Outline of Argument at [57]–[59].

[37] See “promise” defined in s 55(6) of the PLA.

[38] Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 at 122–23. Similar to the shareholders agreement considered in Bidjara Aboriginal Housing & Land Co Ltd v Bidjara Motor Corp Pty Ltd (in liq) [2005] QCA 196 at [17]. The question is to be determined on a careful analysis of a particular factual situation.

[39] [2009] QSC 272.

[40] [1996] 1 Qd R 260.

[41] (2006) 149 FCR 395 at [43].

[42] Tolhurst v Associated Portland Cement Manufacturers (1900) Ltd [1902] 2 KB 660 at 668 affirmed on appeal in Tolhurst v Associated Portland Cement Manufacturers (1900) Ltd [1903] AC 414 at 417 and 420. Referred to by Jacobson J (with whom Finkelstein and Stone JJ agreed) with approval in Leveraged Equities Ltd v Goodridge (2011) 191 FCR 71 at [362].

[43] Shayler v Woolf [1946] Ch 320 at 322.

[44] As was the case in Kemp v Baerselman [1906] 2 KB 604.

[45] Notwithstanding the provision for the shared maintenance of any fence in cl 3 when read with cl 5.

Close

Editorial Notes

  • Published Case Name:

    Consolidated Pastoral Company Pty Ltd v Bellevue Station Pty Ltd & Anor; Bellevue Station Pty Ltd v Consolidated Pastoral Company Pty Ltd

  • Shortened Case Name:

    Consolidated Pastoral Company Pty Ltd v Bellevue Station Pty Ltd

  • MNC:

    [2023] QSC 202

  • Court:

    QSC

  • Judge(s):

    Brown J

  • Date:

    01 Sep 2023

  • Selected for Reporting:

    Editor's Note

Litigation History

EventCitation or FileDateNotes
Primary Judgment[2023] QSC 20201 Sep 2023Orders to effect that owner of pastoral property not required to enter into give-and-take agreement with owner of adjoining property on basis of agreement with previous owner of adjoining property: Brown J.
Appeal Determined (QCA)[2024] QCA 4703 Apr 2024Appeal dismissed: Dalton JA (Mullins P agreeing), Applegarth J agreeing in result in separate reasons.

Appeal Status

Appeal Determined (QCA)

Cases Cited

Case NameFull CitationFrequency
Australis Media Holdings Pty Ltd and Ors v Telstra Corporation Ltd and Ors (1998) 43 NSWLR 104
1 citation
Jump To
Cite 1 - (1998) 43 NSWLR 104
Bidjara Aboriginal Housing & Land Co Ltd v Bidjara Motor Corp Pty Ltd (in liq) [2005] QCA 196
2 citations
Jump To
Cite 1 - [2005] QCA 196
Cite 2 - [2005] QCA 196
Cape Flattery Silica Mines Pty Ltd v Hope Vale Aboriginal Shire Council [2012] QSC 381
3 citations
Jump To
Cite 1 - [2012] QSC 381
Cite 2 - [2012] QSC 381
Cite 3 - [2012] QSC 381
Collins MR in Tolhurst v Associated Portland Cement Manufacturers (1902) 2 KB 660
2 citations
Jump To
Cite 1 - (1902) 2 KB 660
Cite 2 - (1902) 2 KB 660
Crest Nicholson Residential (South) Ltd v McAllister [2004] 1 WLR 2409
3 citations
Jump To
Cite 1 - [2004] 1 WLR 2409
Cite 2 - [2004] 1 WLR 2409
Cite 3 - [2004] 1 WLR 2409
Electricity Generation Corporation (t/as Verve Energy) v Woodside Energy Ltd and Ors (2014) 251 CLR 640
2 citations
Jump To
Cite 1 - (2014) 251 CLR 640
Cite 2 - (2014) 251 CLR 640
Eleven 17 Ocean Street Pty Ltd v Evangelista Pty Ltd(2023) 16 QR 110; [2023] QCA 170
2 citations
Jump To
Cite 1 - [2023] QCA 170
Cite 2 - [2023] QCA 170
Federated Homes Ltd v Mill Lodge Properties Ltd [1980] 1 WLR 594
6 citations
Jump To
Cite 1 - [1980] 1 WLR 594
Cite 2 - [1980] 1 WLR 594
Cite 3 - [1980] 1 WLR 594
Cite 4 - [1980] 1 WLR 594
Cite 5 - [1980] 1 WLR 594
Cite 6 - [1980] 1 WLR 594
Forestview Nominees Pty Ltd v Perpetual Trustees (WA) Ltd (1996) 70 FCR 328
2 citations
Jump To
Cite 1 - (1996) 70 FCR 328
Cite 2 - (1996) 70 FCR 328
Forestview Nominees Pty Ltd v Perpetual Trustees WA Ltd (1998) 193 CLR 154
3 citations
Jump To
Cite 1 - (1998) 193 CLR 154
Cite 2 - (1998) 193 CLR 154
Cite 3 - (1998) 193 CLR 154
Gumland Property Holdings Pty Ltd v Duffy Bros Fruit Market (Campbelltown) Pty Ltd (2008) 234 CLR 237
2 citations
Jump To
Cite 1 - (2008) 234 CLR 237
Cite 2 - (2008) 234 CLR 237
Hyatt Australia Ltd v LTCB Australia Ltd [1996] 1 Qd R 260
2 citations
Jump To
Cite 1 - [1996] 1 Qd R 260
Cite 2 - [1996] 1 Qd R 260
Kemp v Baerselman [1906] 2 KB 604
2 citations
Jump To
Cite 1 - [1906] 2 KB 604
Cite 2 - [1906] 2 KB 604
Leveraged Equities Ltd v Goodridge (2011) 191 FCR 71
2 citations
Jump To
Cite 1 - (2011) 191 FCR 71
Cite 2 - (2011) 191 FCR 71
McGuigan Investments Pty Ltd v Dalwood Vineyards Pty Ltd [1970] 1 NSWR 686
3 citations
Jump To
Cite 1 - [1970] 1 NSWR 686
Cite 2 - [1970] 1 NSWR 686
Cite 3 - [1970] 1 NSWR 686
Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104
2 citations
Jump To
Cite 1 - (2015) 256 CLR 104
Cite 2 - (2015) 256 CLR 104
National Carbonising Co Ltd v British Coal Distillation Ltd (1936) 54 RPC 41
1 citation
Jump To
Cite 1 - (1936) 54 RPC 41
Pacific Brands Sport & Leisure Pty Ltd v Underworks Pty Ltd (2006) 149 FCR 395
2 citations
Jump To
Cite 1 - (2006) 149 FCR 395
Cite 2 - (2006) 149 FCR 395
Roake v Chadha [1984] 1 WLR 40
2 citations
Jump To
Cite 1 - [1984] 1 WLR 40
Cite 2 - [1984] 1 WLR 40
Rodgers v Hosegood [1900] 2 Ch 388
4 citations
Jump To
Cite 1 - [1900] 2 Ch 388
Cite 2 - [1900] 2 Ch 388
Cite 3 - [1900] 2 Ch 388
Cite 4 - [1900] 2 Ch 388
Rural View Developments Pty Ltd v Fastfort Pty Ltd[2011] 1 Qd R 35; [2009] QSC 244
2 citations
Jump To
Cite 1 - [2011] 1 Qd R 35
Cite 2 - [2011] 1 Qd R 35
Sandhurst Trustees Ltd v Australian Country Cinemas Pty Ltd [2006] QSC 165
2 citations
Jump To
Cite 1 - [2006] QSC 165
Cite 2 - [2006] QSC 165
Shayler v Woolf [1946] Ch 320
2 citations
Jump To
Cite 1 - [1946] Ch 320
Cite 2 - [1946] Ch 320
Simmons v Lee [1998] 2 Qd R 671
3 citations
Jump To
Cite 1 - [1998] 2 Qd R 671
Cite 2 - [1998] 2 Qd R 671
Cite 3 - [1998] 2 Qd R 671
Southport Memorial Club Inc v Returned and Services League of Australia (Queensland) Southport Sub-Branch Inc(2023) 16 QR 90; [2023] QCA 146
2 citations
Jump To
Cite 1 - [2023] QCA 146
Cite 2 - [2023] QCA 146
Swift (P. & A.) Investments v Combined English Stores Group Plc. [1989] AC 632
2 citations
Jump To
Cite 1 - [1989] AC 632
Cite 2 - [1989] AC 632
The Portland Downs Pastoral Company Pty Ltd v Bexalaw Pty Ltd (in liq) [2009] QSC 272
2 citations
Jump To
Cite 1 - [2009] QSC 272
Cite 2 - [2009] QSC 272
Tolhurst v Associated Portland Cement Manufacturers (1903) AC 414
3 citations
Jump To
Cite 1 - (1903) AC 414
Cite 2 - (1903) AC 414
Cite 3 - (1903) AC 414
Trident General Insurance Co Ltd v McNiece Bros Pty Limited (1988) 165 CLR 107
3 citations
Jump To
Cite 1 - (1988) 165 CLR 107
Cite 2 - (1988) 165 CLR 107
Cite 3 - (1988) 165 CLR 107

Cases Citing

Case NameFull CitationFrequency
Bellevue Station Pty Ltd v Consolidated Pastoral Company Pty Ltd [2024] QCA 47 1 citation
1

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