Developers need to consider carefully the most appropriate Court to apply for an order for an easement of necessity. Failure to do so can cause delays and incur further costs even if the easement is granted by the Court.

In a recent decision, Shi v ABI-K1, the NSW Court of Appeal varied the terms of a drainage easement ordered by the Supreme Court under section 88K of the Conveyancing Act 1919, from 1 metre to 900mm.

The owner of the adjoining property, Mr Shi, agreed that appropriate drainage measures were reasonably necessary and an essential part of the approved development.  The issue for the Court of Appeal was whether the proposed drainage solution is “reasonably necessary”.

Mr Shi argued that the 1 metre wide easement exceeded the Council’s 900mm setback control in its development control plan and had the effect of sterilising part of his property.

The Court of Appeal agreed and limited the width of the easement to 900mm.

The effect of the Court of Appeal’s decision was that:

  1. the developer was unable to satisfy the condition of consent requiring a 1 metre wide drainage easement; and
  2. e developer then had to apply to the Council to modify the condition so that it would be consistent with the drainage easement imposed by the Court.

Justice Basten (with whom Barrett and Ward JJA agreed) commented that because the Land and Environment Court has the power under section 40 of the Land and Environment Court Act 1979 to make an order imposing an easement, in an appeal in relation to the granting or modification of a development consent, the Land and Environment Court is often better suited than the Supreme Court to assess applications for easements of necessity. 

His Honour also pointed out that the Land and Environment Court can impose appropriate conditions of consent, or modify a condition of consent, relating to an easement,  in an appeal relating to the granting or modification of a development consent.

The case is also a reminder to developers that both Courts will consider the effect of any proposed easement on the burdened property.

Developers therefore must consider whether the easement will sterilise or constrain the development potential of the adjoining property. This will usually involve a review and consideration of the planning controls that apply to the adjoining property and how compliance with those controls may be affected by the easement.