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Steamships Trading Company Ltd v Magellan Properties Ltd [2015] PGNC 181; N6092 (12 August 2015)

N6092


PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]


WS. NO. 763 of 2012


BETWEEN


STEAMSHIPS TRADING COMPANY LIMITED
First Plaintiff /First Cross- Defendant


AND


HARBOURSIDE DEVELOPMENT LIMITED
Second Plaintiff /Second Cross- Defendant


AND


MAGELLAN PROPERTIES LIMITED
First Defendant/First Cross-Claimant


AND


BISMARK MARITIME LIMITED
Second Defendant/Second Cross-Claimant


Waigani: Kandakasi, J.
2014: 17th November
2015: 07th & 14th July
12th August


INTERPRETATION – "Land" - Means to include the soil and everything above and below the soil and includes land below low-water mark and within jurisdiction and land covered with water and to rivers and streams – Section 1(d) Mining Act 1992, s. 2(1) Land Registration Act, s. 8 Native Custom (Recognition) Ordinance 1963 and Article 11 Law of the Sea Convention 1982


LAND LAW – Types of land in PNG – Customary land governed by customary law and alienated land governed by statute and common law principles under the Torrens System – Creation of an easement – Essential elements – Can be created either expressly or by implication provided the essential elements are met – Title with entries by registration conclusive evidence and takes priority over unregistered estates or interests – Nature of easements – Subservient and not a right to a joint use of the land - Omissions of an easement as an exception – Need to establish existence of an easement or one cable of being granted and registered – Lack of – Claims of omission must fail – Substantial re-development or improvement with proper approval or authorization constitute illegal action – Effect of - Defeat any existing easement – Section 11 (1), 17 (1) & (2), 26, 33 (1) Land Registration Act,


Cases Cited:
Papua New Guinea Cases


East West (1) Limited v. Kee An Sim (2006) N3103
Louis Medaing v. Ramu Nico Management (MCC) Ltd (2011) SC1144
The Papua Club Inc v. Nusaum Holdings Ltd (No 2) (2004) N2603
Vincent Ulelio v, Nelulu Land Group [1998] PNGLR 31
Wamp Nga Holdings Ltd v Popuna Nau (2011) N4378


Overseas Cases Cited:


Allen -v- Flood [1897] UKLawRpAC 56; [1898] AC 1.
Ankerson v Connelly [1906] UKLawRpCh 121; [1906] 2 Ch 544.
Bonser v. LaMacchia (1969) at 214 C.L.R
Castle Constructions Pty Limited v. Sahab Holdings Pty Ltd [2013] HCA 11.
Chaudhary v. Yavuz [2013] Ch 249.
Dalton v Angus (1881)6 App. Cas. 740
Garritt v Sharpe [1835] EngR 724; (1835) 3 Ad & El 325.
Hooper v. Rogers [1975] Ch 43 at 50)
Kain v Norfolk [1949] Ch 163.
Keewatin Power Co Ltd v Lake of the Woods Milling Co Ltd [1930] AC640.
Lloyd v. Dugdale [2002] 2 P & CR 167.
New South Wales v. Commonwealth (1975) 135 CLR 487
Post Office v. Estuary Radio Ltd. [1968] 2 Q.B. 740 at 753
Pwllbach Colliery Company Limited v Woodman [1915] AC 634.
Pwllbach Colliery Company Limited v. Woodman [1915] AC 634.
Quinn -v- Leathen [1901] AC 495.
Re Ellenborough Park [1956] Ch 131.
Re Ellenborough Park, Re Davies, Powell v. Maddison [1956] Ch 131.
Temperton -v- Russle [1893] UKLawRpKQB 64; [1893] 1 QB 715.

Legislation and other material cited:


Halsbury's Laws of England, 4th Ed, Vol. 34, at para. 2
Land Registration Act. (Chapter 191) as consolidated to No 21 of 2009.
Law of the Sea Convention 1982
Mining Act 1992, the Law of the Sea Convention 1982

Native Custom (Recognition) Ordinance 1963

Osborn's Concise Law Dictionary, 9th Ed, (2001), London, Sweet & Maxwell at 145.
Peter Butt, Land Law, 5th ed, (2005) Sydney, Law Book Co.

Counsel:


M. Goodwin, for the Plaintiffs
M. Wilson, for the Defendants


12th August, 2015


  1. KANDAKASI J: The parties are neighbors at the Port Moresby water front. A problem has arisen between them when Steamships Trading Company Limited (Steamships) through Harbourside Development Limited (Habourside) (together Plaintiffs) took steps to develop their property. Those steps, according to Magellan Properties Limited (Magellan) and Bismark Maritime Limited (Bismark) (together the Defendants), have blocked off what they claim was an implied easement that gave them a right of way to their properties. This, they say has adversely affected their right of freely accessing and enjoying the full use of their wharf. The Plaintiffs say there was neither an expressed nor an implied easement in favour of Magellan or Bismark which was adversely affected by the development they brought onto their property. They also argue that, the Defendants brought their problem upon themselves by bringing upon their property unapproved or illegal developments that encroached into the Plaintiffs' property. These encroachments they say amount to; nuisance, interference, trespass and an inducement for them to breach their building contract with their builder.

Issues for determination


  1. The issues for the Court to consider and determine are clearly these:
  2. These questions are in part factual and legal. The Court will have to consider the relevant facts concerning the creation of the parties' respective interest in their respective lands, their respective developments on them and whether or not any easement was created and exists. A consideration and application of the relevant law will also help determine these questions. The law here will be the law in relation to land generally and more so, land connected to high water marks, creation and or existence of easements over such land as well as the principles of common law on nuisance, interference, trespass and an inducement to breach the Plaintiffs building contract with their builder. I will state the relevant facts without more where there is no controversy and give reason for accepting one version of the facts as opposed to the other where there is a controversy. I will then apply the relevant law to the relevant facts to arrive at a decision on the main issues presented.
  3. Turning then, to a consideration and answering of each of the above questions, I begin with the third question. This is necessary as it would give some context and meaning to the arguments giving rise to the first and second questions. Before that however, I will discuss the legal meaning given to land particularly when the dispute here concerns waterfront land.

Definition of land


  1. This is the first time a case involving waterfront land in the country has come to the Courts apart from the decision in Vincent Ulelio v. Nelulu Land Group.[1] The case presents the question of whether a person, who has a waterfront land, has title over parts of the land that is covered by sea water. I am grateful for counsels who have ably assisted the Court in drawing to its attention the relevant provisions of the Mining Act 1992, the Law of the Sea Convention 1982 and a number of cases on point.
  2. Section 1(d) of the Mining Act 1992 defines 'land' to include

"offshore area being the seabed underlying the territorial sea from the mean low water springs level of the sea to such depth as admits of exploration for or mining of minerals."


  1. This idea of land including land covered by water is reinforced by the definition of land in s. 2(1) of the Land Registration Act.[2] This provision reads:

"land" means the soil and everything above and below the soil and includes—


(a) land below low-water mark and within jurisdiction; and


(b) land covered with water; and


(c) rights to rivers and streams..."


(Underlining supplied)


  1. This is consistent for instance with the kind of recognition given by s. 8 of the Native Custom (Recognition) Ordinance 1963 which says;

"...custom may be taken into account in relation to:


(b) the ownership by custom of rights in over or in connection with the sea or a reef or in or on the bed of the sea or rights to fishing.


(c) the ownership by custom of water or of rights in, over or to water."

(Underlining supplied)


  1. International law, in particular the Law of the Sea Convention 1982[3] to which PNG is a signatory endorses that position by Article 11. This provision reads:

"For the purpose of delimiting the territorial sea, the outermost permanent harbour works which form an integral part of the harbour system are regarded as forming part of the coast. Off-shore installations and artificial islands shall not be considered as permanent harbour works."


  1. That position is further strengthened by international law, which says a State's sovereignty extends beyond the internal waters of the State to the territorial sea which is twelve (12) nautical miles or 22.2 kilometers out from the coast line. Article 2 of the Convention which recognizes a States entitlement to its coastal and territorial waters[4] states in these terms:

"the sovereignty of a coastal State extends, beyond its land territory and internal waters and, in the case of an archipelagic State, its archipelagic waters, to an adjacent belt of sea, described as the territorial sea."


  1. Prior to the Law of the Sea Convention, it was long recognized at common law that, the King or the Crown had ownership or dominion over seas within his control. This is illustrated in the decision in In New South Wales v. Commonwealth,[5] and in Bonser v. LaMacchia,[6] where Windeyer J said:

"Time and time again it must be accepted that the seas belonged to the King, both in governorship and proprietorship".


  1. A position elaborated in Post Office v. Estuary Radio Ltd.[7], by Lord Diplock who said:

"It still lies within the prerogative power of the Crown to extend its sovereignty and jurisdiction to areas of land or sea over which it has not previously claimed or exercised sovereignty or jurisdiction. For such extension, the authority of Parliament is not required."


  1. Based on these authorities, Woods J., in the Vincent Ulelio v. Nelulu Land Group case declared a fee simple title a nullity in so far has it concerned and covered sea areas in the Aliwo Passage area. He reasoned that the sea was a highway to all and as such there can be "no recognition of any absolute possessory title in individuals or groups to the sea for all purpose". In so doing His Honour however, placed little or no weight to the fact that customary rights and claims of ownership by most of PNG's coastal water inhabitants and the definition of land included sea areas in appropriate cases. Aggrieved by that decision, the Defendants in that case, who were my then clients, successfully lodged an appeal based on two main grounds. First, all coastal water people in PNG have by custom ownership and user rights over their coastal waters in so far as their eye can see. This cannot be ignored or made subservient to the common law position without going through the test provided for in Schedules 2.1 and 2.2 of the Constitution. The second ground was that, legislative definition of land in PNG included coastal sea areas. As such, the State could grant title or other interests in land over sea waters. Both of these grounds were accepted by the Supreme Court, resulting in quashing of the decision of the National Court and remitting the matter back to the National Court for trial before a different Judge. Unfortunately, the Supreme Court did not publish its reason for its decision. I have no information on what became of the case in the National Court or the Supreme Court, if it ended up in there. There is no published reason to assist us here.
  2. For the case, before me now, I accept learned counsel for the Plaintiffs' submission that, clearly sovereign nations, including Papua New Guinea, does have the right and power to grant interests in land inclusive of land over which there is seawater within its territorial sea, particularly harbour waters adjacent to the land. In this case, the Plaintiffs' as well as the Defendants have a proper and enforceable right over their respective properties as long as they stay within their respective boundaries. As long as neither encroach into the other's boundary, they are entitled to either build a wharf or bring on other developments subject only to conditions for the grant of title and the relevant authorities approval of what they set out to do and provided always that one does not interfere with the rights and interest of others who are entitled to use the greater sea areas.
  3. I now turn to a consideration of the third question, which is, have the Defendants' encroached upon the Plaintiffs' property and committed acts of nuisance, interference, trespass and induced a breach of the Plaintiffs' building contract with their builder? The issues raised are all based on the tort at common law and are raised out of the same set of facts. I will thus discuss the relevant legal principles separately but the decision in respect of each of them will be one.

Third Question: Encroachment, nuisance, etc.


(a) Private nuisances and interference


  1. The first consideration under the various torts the Plaintiffs claim against the Defendants is private nuisance and interference. Dealing firstly with the first issue of nuisance, I accept the legal position that, both the Plaintiff and the Defendants and indeed any other property owner has the right to enjoy the use of his or her property without unnecessary and uncalled for interference from each other or other people who have no legal or equitable right or claim to the property. As the decision in Hooper v. Rogers[8] illustrates, this is a well-accepted position at common law.
  2. The decision of the Supreme Court in Louis Medaing v. Ramu Nico Management (MCC) Ltd[9] adopted an applied this principle. There the Court per Hartshorn and Sawong JJ. at paragraph 159 of the judgment with support from Davani J. (at paragraph 2) stated:

"... we are satisfied that an essential element of the cause of action of private nuisance is that there has been interference with the occupiers interest in the beneficial use of his land...."


  1. It follows therefore that, a property owner is entitled to seek damages and appropriate orders including injunctions, removal or other orders against any uninvited or unauthorized interference with a property owner's right of ownership, use and enjoyment of his or her property. Here, the Plaintiffs claim that the encroachments by the Defendants' are actual and direct physical encroachments over and across the Plaintiffs' land. These the Plaintiffs claim is preventing the direct beneficial use of portions of their land, and in particular in relation to the over water encroachments; which prevent the Plaintiffs from building an approved car park on their land. In the circumstances, the Plaintiffs claim they are entitled to claim damages and to abate the permanent encroachments as well as declaratory reliefs preventing the Defendants from continuing to cause a nuisance on, or interfere with, the Plaintiffs' land.
(b) Trespass
  1. Trespass is the next legal foundation for the Plaintiffs' claim against the Defendants. Trespass is a tort committed against another's property. It is similar to nuisance which interferes with an owner's right over his land. But unlike nuisance, a trespass is actionable even without damage being suffered. Halsbury's Laws of England, 4th Ed, Vol. 34, at para. 2 helps define the difference between a trespass and nuisance in these terms:

"The distinction between the two is that in trespass the immediate act which constitutes the wrong causes an injury to the sufferer's person or damage to his property or amounts to dispossession, whereas in nuisance the act itself often does not directly affect the person or the property of another, but has consequences which become prejudicial to his person or property."


  1. Here, the Plaintiffs claim that the Defendants' encroachments directly dispossess the Plaintiffs of parts of their land, which prevents them from building an approved carpark on their Land. These they say are direct causes of injury and damage to the Plaintiffs' which constitute an actionable trespass in addition to the right of action the Plaintiffs have as against the Defendants for nuisance.

(c) Inducing breach of contract


  1. The final principle upon which the Plaintiffs have brought their claim is the allegation of the Defendants' actions, inducing breach of their contract with their builder. As my learned brother, Gavara-Nanu J., noted in The Papua Club Inc v. Nusaum Holdings Ltd (No 2); [10]

Inducing breach of a contract is an actionable wrong in tort for which the wronged party may claim damages. But for there to be an action for damages, the wrong doer must have interfered in the contractual relations between the contracting parties recognized by law. This principle was stated by Lord MacNaghten in Quinn -v- Leathen [1901] AC 495. At 510 his Lordship said:


'It is an actionable wrong to interfere with contractual relations recognized by law, if there be no justification for the interference.'


The principle was stated in the much earlier case of Allen -v- Flood [1897] UKLawRpAC 56; [1898] AC 1 at 107:


'...he who willfully induces another to do an unlawful acts which, but for his persuasion, would or might never have been committed, is rightly held to be responsible for the wrong which he procured.'"


  1. It is clear that the essential elements to found an action for inducing breach of contract are: (1) that the wrongdoer had knowledge of the contract; (2) that he interfered with it or prevented its performance to the detriment of a party resulting in a breach; (3) the breach was attributable to the interference; and (4) the breach resulted in damages.[11]
  2. Having regard to these principles, the Plaintiffs claim that the Defendants were, or should have been, aware that the Plaintiffs were developing their land, and were also aware that building work had commenced on the Plaintiffs' land. The Plaintiffs further claim that, it was reasonably foreseeable to the Defendants that the Plaintiffs had engaged a builder under contract to construct the development, including the carpark, and that the encroachments by the Defendants, would interfere with, and prevent, the construction of the carpark, thereby inducing a breach of the Plaintiffs' building contract with their builder for which the Plaintiffs are liable. This they submit is real because, the Defendants' continued encroachments and interference has induced or caused the Plaintiffs to breach its building contract with its builder in terms of a delay in completion of the building, which means loss and damages to the Plaintiff which attracts daily prolongation costs or delay damages under clause 39.4 of its building contract.

Relevant Facts


  1. The relevant facts giving rise to the issues before the Court are this. Steamships is the proprietor of a piece of water front land situated in Downtown Port Moresby described as Portion 773, Volume 1 Folio 153, under a special purpose lease date 6th August 1991 (Portion 773), which is registered on Cat Plan No. 49/2527. Harbourside is a company in which Steamships has a 50% shares interest and it contracted to purchase the said land. Magellan is the owner of a land directly adjacent to Port 773, which is described as Portion 53, Section 6 Volume 28 Folio 6833 (Portion 53) registered on Cat Plan No. 49/1524. Bismark owns and operates a maritime and shipping business on Portion 53. The business includes the loading and unloading of cargo from marine vessels.
  2. The Plaintiffs claim that the Defendants' activities which includes fencing and building of a wharf ramp into its property, increasing the physical size of the Defendants' jetty or wharf then known as "Craig's Wharf", marine vessels and ships owned or under the authority and control of the Defendants traversing and approaching to berth or leave their wharf into or from the Plaintiffs' property amounted to encroachments into the Plaintiffs' land, Portion 773. To support their claims, the Plaintiffs rely on evidence and facts set out in the affidavits of:
  3. The Plaintiffs claim also that despite numerous requests by them, the Defendants refused or failed to abate, stop or remove these encroachments and interfered with the Plaintiffs' use and enjoyment of their land including their current developments on their land. That they claim has resulted in loss and damages.
  4. The question of whether there is an expressed or implied easement in favour of Magellan or Bismark, can be determined by reference to when the interest in the two properties were created and when and how the developments were brought upon or within them. Accordingly, I note that, before the Defendants acquired their interest in Portion 53, a Mr. Roger Cunningham, of the then Federation of Savings & Loans Societies had a shipping service to facilitate the delivery of copra from the Papuan Coast to Port Moresby, where the Copra Marketing Board had and now has a depot. The Federation built on the property, their offices and had a wooden wharf which is the "Craig's Wharf" after its then owner and manager, Hebert Craig. The wharf was originally a small, narrow, long and fell well within the boundaries of the property and that the boundary between Portion 53 and Portion 773 was a straight line running between them. This is apparent from the plan in the title document and other documentary evidence before the Court. Such evidence include the registered Survey Plan dated 4th September 2004 of Allotment 6, Section 53, Granville in Annexure "C" to the Affidavit of Andrew Potter, a copy of the original title as at the time of the acquisition of the property by Magellan, which annexure "A" to Mr. Hamish Sharp's affidavit sworn and filed on 27th January 2014 and annexure "C" to Jon Cullen's affidavit sworn on 8th April and filed on 25th April 2014. Other copies of the title to the Defendants' property and that of the Plaintiffs' and the general area confirm this position. Accordingly, I find that, the original structure of Craig's Wharf as described was able to allow for ships or vessels owned or invited by the Defendants to have easy access to and from the wharf without any issues of encroaching into the neighbour's property.
  5. Subsequently, Magellan acquired Portion 53 and had its interest registered on the title on 8th February 1994. According to Hamish Sharp, Magellan was given approval and in accordance with such approval, it redeveloped the old Craig's Wharf. In support of his claim, Mr. Sharp annexes only one piece of documentary evidence. That is a copy of a letter dated 20th July 2000 from the PNG Habours Board under the hand of the then Chairman of the Board, Mr. Timothy Bonga, MBE. No other evidence is before the Court which shows the specific details of the proposed developments, where, when, how and with whom the applications for approval were lodged, and when and how each of the relevant authorities, such as the NCDC Physical Planning Board and the PNG Habours Board considered and arrived at their respective decisions to approve as proposed or with modifications. The letter by Timothy Bonga, MBE does not assist in any of these respects. It is obvious to me that this letter appears to have been generated on its own and not one that corresponds to or is connected to any particular application or letter or a communication from the Defendants or anybody including any of the approving authorities. A complete contrast of that is what the Plaintiffs did when it came to their development of their property by way of applications and the kinds of approval they received. The affidavit of Andrew Potter sworn on 12th and filed on 25th November 2013 clearly refers to and annexes the following documents:
  6. For the purpose of their development, the Plaintiffs secured a survey plan from Arman Larmer Survey Limited date 17th May 2012. Based on that survey plan which confirms with what is on the title to Portion 773, the Plaintiffs drew up their development plans. These plans though within their boundary did have the effect of interfering with the Defendants' vessels or vessels controlled by them, mooring in and berthing and leaving from the Defendants' wharf and ramp. Indeed, the Defendants have anchored one of their vessels next to the Plaintiffs' works currently being undertaken, which is effectively restricting work close to the vessel, especially works on a carpark over the water. This is supported by an interim injunctive order obtained by the Defendants.

Finding and Decision on issues other than easement


  1. Subject to a decision on whether there is or no easement in favour of the Defendants, I will first consider and determine the common law based arguments. Thus, on the strength of the totality of the evidence before me, especially the original maps for the respective neighbouring properties, to the location maps and development plans and based on my observations following a visit of the scene, I make the following findings and decisions on the issues before the Court:

Finding and decision on easement


  1. This then makes it necessary for me to consider the arguments on whether there is or no easement in favour the Defendants. The first thing I note and find is that, the Defendants who are claiming the existence of an easement in their favour have not adduced any evidence supporting their claim. The most ideal thing for the Defendants to do was to produce a title document or any other instrument creating the easement they are claiming. In PNG, land is either customary land, which is governed by customary law or is alienated land, which is governed by the Torrens Title System which is well-grounded in the common law, the Land Act 1996, the Land Registration Act[12] and other relevant and applicable Acts of Parliament. In this case, the dispute involves parties who are neighbours sharing a common border to two adjacent pieces of alienated. Under the Torrens System, ownership and other rights and or interest in land are recognized and can be claimed and enforced on the basis of a title or interest duly registered under the Land Registration Act.
  2. Sections 11 (1) in relevant parts of the said Act reads:

"11. Certificate of title to be evidence.


(1) The Registrar's duplicate of a certificate of title, when registered—


(a) is evidence of the particulars it specifies; and


(b) is conclusive evidence, in relation to the land it describes, that the person named in the certificate of title—


(i) as seised of an estate in land; or


(ii) as taking or otherwise entitled to an estate or interest in the land,


is seised of, possessed or entitled to that estate or interest, as the case may be; and


(c) is conclusive evidence that the property comprised in the certificate of title is under this Act."

(Underlining supplied)


  1. Section 26 of the Act in effect repeats and restates this position. Section 17 (1) and (2) of the same Act also reinforces this position but by stipulating the status of unregistered rights or interests in land. Where the interest has to be in an instrument as is the case for all dealings in land, the instrument must be registered in accordance with the Act to be effective. Otherwise as subsection 1 stipulates, "an instrument is not effective to pass or create an estate or interest until the instrument is registered in accordance with this Act." The importance of this legal position is re-emphasized by s. 33 (1) in these terms: "[t]he registered proprietor of an estate or interest holds it absolutely free from all encumbrances..."
  2. Clearly, the Defendants failed to establish their claim of an easement in the ideal way and instead argue for the existence of an easement in their favour by referring to and relying on certain covenant or conditions for the title registered to the First Defendant over Portion 53. Should they fail in that, they argue for their easement existing by implication. I deal firstly with the argument based on entries in the title to the First Defendant's title to Portion 53.
  3. The relevant entries which I will call hereafter, convent reads:

"Construction and maintenance of improvements for wharf and ancillary purposes to be in accordance with plans and specifications submitted to and approved by the Papua New Guinea Harbours Board.


The wharf or jetty shall be available for coastal ships other than those of the lessee when berthage is not fully utilized by the lessee's ships."


  1. The Defendants claim these covenant amounted to a grant of a right of way or easement, which binds the Plaintiffs. Is this claim sustainable? This is a question that must be answered with the assistance of the relevant legal principles on easement and the relevant facts.
  2. In a bid to support their claim, the Defendants called the Acting Surveyor General, Chris Manda. In his evidence, this witness said there are no recordings of an easement on the registered survey plans at annexures "A" and "C" to the Affidavit of Andrew Potter. He also stated that any easement would be recorded on the registered survey plans which do not appear to be the case here. He has earlier done a report with recommendations for an easement in favour of the Defendants. That recommendation was arrived at without the benefit of some of the evidence now before the Court that are critical. This includes the registered survey plans the witness did not have and or see at the time. The witness was also not aware that the Defendants brought upon their land the unapproved and therefore unauthorized development in mid-2003. The witness admitted in cross-examination that his report could have been different had he had these information.
  3. Makail J., in Wamp Nga Holdings Ltd v Popuna Nau,[13] correctly in my view identified the essential elements that must be present in order that there can be an easement. The essential elements are:
  4. These essential elements come from the relevant common law on point which is summarized for in instance in Osborn's Concise Law Dictionary,[14] in these terms:

"[a] servitude; a right enjoyed by an owner of a land over another such as a right of way, of light, of support, or air or water. An easement must exist for the accommodation and better enjoyment of land to which it is annexed; otherwise only a mere license can exist. An easement is acquired by grant or prescription. The land owned by the possessor of the easement is called the dominant tenement and the servient tenement is the land over which the right is enjoyed."


  1. I think the last of the four (4) essential elements outlined above is critical in this case in addition to meeting the other elements. What that means in my view is that, in order for there to be an easement, it must be one capably of being expressly granted and capable of enforcement.[15] The nature and extent of an easement created by express grant usually depends upon the wording of the instrument and the circumstances existing as at the time of its execution and grant, and is limited to such circumstances and must be definite in its terms.[16]
  2. In the present case, there are five (5) factors operating against the claim of an easement by the covenants. Firstly, I remind myself of the facts in relation to the original Craig's Wharf and the subsequent changes to it by the Defendants. Having regard to those facts, I am of the view that, the conditions entered on the title to the Defendants' land must be limited to the circumstances as at the time of the grant of the State Lease or title and entry of the covenants. This limits the application of the covenant to Craig's Wharf as it then was originally both structurally and the kinds of vessels it could accommodate as at the time. I also find that, even if the covenants were to be construed as an easement, its nature and extent prior to the unapproved redevelopments were such that there was no need for a ship to traverse across or occupy the Plaintiffs' land. This position is supported in my view by the fact that the title to Portion 773 does not have a similar covenant or condition. If traversing across the Plaintiffs' land was considered necessary, the State would have at the time of the grant of the State Lease over Portion 773 provided for such a covenant but it did not, because there was no need for it.
  3. In any case, I find that, if somehow the covenant in Portion 53 amounted to an easement, they were rendered inapplicable or extinguished upon the introduction and bringing into existence of the unapproved, unauthorized and therefore illegal redevelopments. These redevelopments apart from being illegal and hence, unenforceable, they substantially and completely changed the character, dimensions, size and shape of Craig's Wharf forcing the encroachments into the Plaintiffs' land. It is settled at common law that, an intention to abandon an easement may be inferred from alterations made in the dominant tenement, or in the mode of using the easement by which the burden is materially increased.[17] Where the alteration is substantial, an intention to abandon the easement will be more readily presumed.[18]
  4. In this case, I am of the view that, it is not possible to sever the increased burden to preserve any right to which the Defendants' claim to be entitled to. This is so because of the unapproved, or unauthorized or illegal additions, alterations and or modifications to their wharf are so great that the wharf would need to be demolished to reduce the burden. The effect of the increase in burden created by the substantial additions, alterations and modifications is to change the way in which the Defendants use the purported right of way for their shipping. Given the increase in size and dimension of the wharf, the ships must now traverse across and occupy the Plaintiffs' land, when this was not contemplated or necessary for the original wharf structure. The unapproved, or unauthorized or illegal alternations which grew Craig's Wharf substantially and caused the current encroachments, is a recent development which has changed the very landscape for the use of the area.
  5. By their conduct, the Defendants brought upon themselves the doctrine of estopped by conduct which prevents them from complaining about the difficulties they are now faced with, due mainly to their own unapproved, unauthorized or illegal redevelopments and or their failure to construct the redevelopments in a manner that would allow access for ships coming in and out of the former Craig's Wharf without encroaching into the Plaintiffs' land. Accordingly, I am of the view that, it is unjust and inequitable to allow the Defendants to assert an easement, by the covenants forming part of the title to their property, Portion 53 or, by any grant or, by any implication or, by any prescription or otherwise, beyond what was originally in place. This view would help the Defendants avoid causing any interference with the rights of others by changing or altering the nature and extent of the dominant tenement to any easement or right of way.
  6. Secondly, I note that, the covenant imposes two kinds of obligations on the Defendants. The first is for them to allow for other ships or vessels to use their wharf. Secondly, they are required to seek proper approvals for improvements to the wharf from the Habours Board. I am of the view that, the requirement for approval from Habours Board is in addition to and not exclusive of the other approvals the First Defendant as property owners were required as a matter of law to seek and secure before bringing on any improvement or development. Their unapproved, unauthorized or illegal redevelopments could hardly form any basis for any easement in favour of the Defendants and as against or over reaching the Plaintiffs land.
  7. Thirdly, I find there is no express grant of a right of way or easement between the adjoining lease owners, namely the Plaintiffs and the Defendants. There is no evidence of Plaintiffs having contracted with the Defendants for an easement. All there is; is simply a condition or covenant imposing obligations against the Defendants as to matters contained in the covenant, and no one else.
  8. Fourthly, on a proper construction of the wording of the covenant, there is no reference to any servient or dominant tenement in two different persons or entities which relates to or binds the Plaintiffs, or at all. The lack of any referral to a servient tenement on the title means that there is a complete failure of the test that "there must be a dominant tenement and a servient tenement" as well as the other essential elements.
  9. Fifthly, I find there is no evidence of the Plaintiffs or indeed persons other than the Defendants themselves using the Defendants' wharf. Similarly, there is no evidence of there being a wharf on the Plaintiffs' property, Portion 773 which has been open for use by the Defendants and other third parties at any material time who now stand to be adversely affected by the Plaintiffs' duly approved, or authorized and legal developments. This is unlike the obligation the Defendants have under their title to Portion 53.
  10. Based on the foregoing reasons, I am of the view that only one conclusion or decision is called for. The conclusion is this. The argument for a creation and existence of an easement in favour of the Defendants by the covenants in the title to Portion 53 is supported neither in fact nor in law. As such that argument fails.

Implied easement


  1. Having arrived at that decision, it is necessary to consider the arguments around any implied easement. I remind myself that even in that case, the critical test or element is "the right must be capable of forming the subject matter of a grant". The question then is what are factors that might suggest an easement in favour of the Defendants?
  2. As noted already, the Defendants are with their ships traversing over an area of the Plaintiff's land, Portion 773. In addition, from my inspection of the site, it was obvious to me that the Defendant's vessels take parts of Plaintiffs' land at times of berthing, docking and departure from the Defendants wharf. This, the parties agree have been going on for a long period of time with no end in sight. There is no agreement in place between the parties that governs any or all of these activities or the Defendants seeking to have in place any such agreement with the Plaintiffs.
  3. The Plaintiffs argue that, the Defendants' actions amount more to a claim of a right or license, or an assertion of a joint right to occupy, which is not agreed to and not accepted by the Plaintiffs. The Plaintiffs claim further that, they are being deprived of proprietorship and possession of parts of their land taken up by the Defendants operations. Reliance is place on the decision in Pwllbach Colliery Company Limited v. Woodman[20] per Lord Parker who held:

"Like the Court of Appeal, I doubt whether their alleged right is an easement properly so called. It is highly indefinite....For the reason given by Lord Blackburn (Dalton v Angus (1881)6 App. Cas. 740 at p. 824) in explaining why at common law there is no easement to have an uninterrupted view over another's landscape, namely, that anything "which would impose a burthen on a very large and indefinite area should not be allowed to be created, except by actual agreement," I think this right is too indeterminate to be an easement proper."


  1. The Plaintiffs' further rely on the decision in Re Ellenborough Park, Re Davies, Powell v. Maddison,[21] where the Court stated[22]:

"We turn next to Dr Cheshire's fourth condition for an easement - that the right must be capable of forming the subject matter of a grant. As we have stated earlier, satisfaction of the condition in the present case depends on a consideration of the questions whether the right conferred is too wide and vague, whether it is inconsistent with the proprietorship or possession of the alleged servient owners...."


  1. The last case cited and applied with approval a decision by Upjohn J., in another case, (Copeland v. Greenhalf) which concerned a person dealing with repairs to motor vehicles for a trade, had for indefinite periods of time, motor vehicles parked until their repairs at a strip of land which was subject to a right of way. hese , the courtcourt correcorrectly found that the claimant was occupying and seeking the right to occupy for an unspecified pa the for the purpose of his business, and carrying on such business upon the land so o so occupiccupied. The Judge was of the view that the right claimed went wholly outside any normal idea of an easement, that is, the right of the owner or the occupier of a dnt tenement over a servient tenement.
  2. In the case before the Court the Judge said:

"This claim (to which no closely related authorit been referred to me) reallreally amounts to a claim to a joint user of the land by the Defendant. Practically, the Defendant is claiming the whole beneficial user of the strip of land on the south-east side of the track there; he can leave as many or as orries there as he likes for as long as he likes; he may enter on it by himself, his servanervants and agents to do repair work thereon. In my judgment, that i a ct a claim which can be established as an easement. It is vily a claim to poss possession of the servient tenement, if necessary to the exclusion of the owner; or, at any rate, to a joint user, and no authority has been to me which would justify the conclusion that a right of t of this wide and undefined nature can be the proper subject-matter of an easement. I say nothing, orse, as toas to the creation of such rights by deeds or by covenant; I am dealing solely with the question of a right arising by prescription."


  1. Counsel for the Plaintiffs also referred to the more recent decision of English Court of Appeal in Chaudhary v. Yavuz.[23] In that case, the parties had adjacent properties with one containing a metal staircase in the alleyway on the boundary between the properties on the neighbour's land. The Plaintiff used the staircase on the neighbour's land for access to his land. There was no deed for the grant of an easement over the staircase and no notice of a right of way was ever registered under the English Land Registration Act 2002. In this circumstance, after carefully going through the earlier authorities including those I earlier cited here, the Court held that the use of the staircase or right of way did not amount to actual occupation of them under the registration of land system. The Court also held that such use did not create a constructive trust and that it was not unconscionable for a purchaser of the neighbour's property to remove the staircase or obstruct its use.[24]
  2. I find that the case before me is almost on all fours with the cases referred to above. The traversing and occupation of parts of the Plaintiffs' land by the Defendants has the effect of amounting to an exclusive and unrestricted use of parts of the Plaintiffs' land. Indeed, that is what is being presently demonstrated by the vessel that is anchored in a way that encroaches into the Plaintiff's property. The grant of exclusive and unrestricted use of land passes the property or ownership in the subject land and is not merely an easement to it as observed in Reilly v Booth. Allowing the Defendants to use the purported servient tenement to the exclusion of the Plaintiffs' or which would prevent the owner from making ordinary use of its land, cannot take effect as an easement, either by grant or prescription as was held in Reilly v. Booth; Re Ellenborough Park. This is particularly so in this case when there is no clear contract or agreement between the parties allowing for an easement in the terms argued for by the Defendants and more so when there is no clear grant or likelihood of there being a grant in favour of the Defendants.
  3. Further, my site inspection or taking a view of the scene also assisted me to observe and come to the view that, the Defendants could easily come and go from their wharf to the open sea or that area of the sea where all sea going vessels access on either coming into or out of the habour or the wharfs in the area. The Defendants are duty bound to adjust their wharf and ramp subject to proper approvals being sought and granted which has the potential of giving them the kind of flexibility and maneuverability they wish to have in their operations. Easements are created usually for holders of such interest or right to access their land or areas which they are not otherwise able to. Here the Defendants are not without any option. In view of all of these factors, I am unable to find that, an easement could be implied and more so is capable of a grant in favour of the Defendants.

Omitted Easement - Section 33(1)(d) of the Land Registration Act


  1. This leaves me to turn to a consideration of the Defendants remaining claim of their easement being omitted with the support of the provisions of s. 33 (1) (d) of the Land Registration Act. The provision in relevant parts reads:

"(1) The registered proprietor of an estate or interest holds it absolutely free from all encumbrances except-

...

(d) in the case of the omission or misdescription of any right-of-way or other easement created in or existing on the same land."


  1. The Defendants claim, an easement should be existing in their favour or for their benefit. Unfortunately, they claim the title documents omitted to include and therefore allow for a registration of such an easement. There are no cases specifically in PNG on section 33(1)(d). Hence, looking abroad for persuasive authority, learned counsel for the Plaintiffs assisted me to a decision of the High Court of Australia. That decision interpreted a provision similar to our provision and variations of it over time; in its recent decision in Castle Constructions Pty Limited v. Sahab Holdings Pty Ltd.[25]
  2. There, while the Court accepted that the Registrar has the power to restore or remove the recording of omitted easements in the folio of the register, it held that, there may be circumstances where this cannot be done. In so doing, the Court brought out two important principles. Firstly, is the point that, the Torrens System is not a system of registration of title, but a system of title by registration. Here is what the Court said:

"It is of fundamental importance to recognize that the Torrens system of registered title, of which the RPA [Real Property Act] is a form, "is not a system of registration of title but a system of title by registration". "Together with the information appearing on the relevant folio, the registration of dealings manifests the scheme of the Torrens system to provide third parties with the information necessary to comprehend the extent or state of the registered title to the land in question."


  1. Secondly, the Court made the point that the equivalent provisions of s.33 (1)(d) cannot be used by subsequent purchasers or registered proprietors of an interest in the dominant tenement which does not record the easement in the register. In its own words the Court said:

"...there is a more fundamental reason why the subsequent purchaser cannot compel the Registrar-General to restore the easement. The interest which the former owner of the dominant tenement transferred was the interest as the registered proprietor of land which by then did not have the benefit of any registered easement. Because it is a system of title by registration, the subsequent purchaser only acquired that interest shorn as it then was of any recorded easement."


  1. In the case before me, the creation of the Defendants' property Portion 53 and the Plaintiffs' property Portion 773, have no easements registered or recorded on either title. Portion 53 was originally issued to the Federation of Co-operative Associations Ltd in 1972 without any recording of an easement in the relevant folio of the register. In 1989 it was transferred to Hencum Services No. 19 Pty Ltd, again without any recording of an easement in the relevant folio of the register. In 1994 it was transferred to the first Defendant again with no recording of an easement in the relevant folio of the register.
  2. The position was similar in respect of entries on the relevant folio in the register for the Plaintiffs' property, Portion 773. It was originally issued to Burns Philp (PNG) Limited in 1990 without any recording of an easement in the relevant folio of the register. In 1992 it was transferred to Laurie (PNG) Pty Limited also without any recording of an easement. In 2009 it was transferred to the First Plaintiff without any recording of an easement in the relevant folio of the register.
  3. There is no evidence of any of the registered proprietors at the relevant time of their ownership of either of the properties ever claiming an easement or applied to the Registrar of Titles to have an easement restored to the register. Under the principle stated in Castle Constructions Pty Limited v Sahab Holdings Pty Ltd, the Defendants cannot claim an easement at all, nor seek the benefit of section 33(1) (d) for an omitted easement, as they purchased land which did not have the benefit of a registered easement.
  4. The effect of the decision or the views I arrived at on the issues I have already considered which in short were:

provide additional reason to reject the Defendants argument for an omission of an easement.


  1. Ultimately, I find that the Plaintiffs have made out their case both in fact and in law. Accordingly, I order judgment for the Plaintiffs. Then as to the specific orders I should make, I noted, neither counsel addressed the Court on that. I will hear counsel and come to a decision on the final terms of the orders that should issue.

________________________________________________________________
O'Brian Lawyers: Lawyers for the Plaintiffs
Warner Shand Lawyers: Lawyers for the Defendants

[1] [1998] PNGLR 31.
[2] (Chapter 191) as consolidated to No 21 of 2009.
[3] PNG signed the Convention on 10 December 1982 but did not have it ratified until 14 January 1997.
[4] It is internationally accepted that, the sovereignty of the State extends beyond the internal waters of the State to the territorial sea which is twelve (12) nautical miles or 22.2 km out from the coast line.
[5] (1975) 135 CLR 487.
[6] (1969) at 214 C.L.R.
[7] [1968] 2 Q.B. 740 at 753.
[8] [1975] Ch 43 at 50.
[9] 2011) SC1144.
[10] (2004) N2603.
[11] See Sao J., in East West (1) Limited v. Kee An Sim (2006) N3103
[12] Chapter 191.
[13] (2011) N4378.
[14] 9th Ed, (2001), London, Sweet & Maxwell at 145. His Honour also had ready to Peter Butt, Land Law, 5th ed, (2005) Sydney, Law Book Co, at 419, para. 1601 and at 422, para. 1609 as endorsed by the English Court of Appeal in Re Ellenborough Park [1956] Ch 131 at 140.
[15] See: Kain v Norfolk [1949] Ch 163).
[16]See: Pwllbach Colliery Company Limited v Woodman [1915] AC 634 at 634 and Keewatin Power Co Ltd v Lake of the Woods Milling Co Ltd [1930] AC640.
[17] See: Ankerson v Connelly [1906] UKLawRpCh 121; [1906] 2 Ch 544.
[18]19 See: Garritt v Sharpe [1835] EngR 724; (1835) 3 Ad & El 325 – per Lord Denman CJ:

[20] [1915] AC 634 at 648.
[21] [1956] Ch 131.
[22] at p. 175-177.
[23] [2013] Ch 249
[24] For earlier statements of this principle or position at law see: Lord Justice Lloyd in Lloyd v. Dugdale [2002] 2 P & CR 167 at page 269 and 270.
[25] [2013] HCA 11.

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