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EASEMENTS and COVENANTS Final Report 22 EASEMENTS AND COVENANTS Final Report 22 1 1185-VLRC_EasementTitlePage-FinalRep22.indd 1 13/12/10 12:58 PM Contents Terms of Reference 4 Chapter 4: Implied and Prescriptive Easements 43 Preface 5 Implied easements 44 Glossary 6 Common law implied easements 44 Easements implied by statute 47 Executive Summary 10 Prescriptive easements 50 Recommendations 12 Criticisms of prescription 51 Chapter 1: Introduction 19 Conclusions on reform of prescription 54 The law of easements and covenants in Victoria 20 Statutory reciprocal rights 57 Easements 20 Easements and the Torrens system 58 Covenants 21 Should easements be recorded or Public planning and private rights 21 registered? 58 Review of the law of easements and covenants 22 Common law extinguishment by unity Other reviews 22 of estates 59 Structure of this report 23 Narrowing the enforceability of unrecorded easements 60 Chapter 2: Purpose and Characteristics of Easements 25 Chapter 5: Regulatory Easements 63 Essential characteristics of private easements 26 Function of regulatory easements 64 Regulatory easements 26 Creation of regulatory easements 64 Should there be more types of easements? 27 On plan of subdivision 64 Private easements in gross 27 Compulsory acquisition by developer 64 Negative easements 28 Acquisition directly from the servient landowner 66 Chapter 3: Express Creation of Easements 31 Installation and maintenance of assets without an Express grant or reservation 32 easement 66 Express subdivisional easements 32 Availability of information about regulatory Overlapping provisions for express easements 66 subdivisional easements 33 Availability of information about assets when no Standard wording 33 easement has been acquired 68 Compulsory acquisition 36 Submissions 70 Section 36 of the Subdivision Act 36 Chapter 6: Purpose and Nature of Covenants 73 Section 235 of the Water Act 36 Enforcement of restrictive covenants in equity 74 Other jurisdictions 37 Restrictive covenants distinguished from Submissions 38 statutory agreements and restrictions 75 Recommendations for the creation of private Statutory agreements 75 easements by order of VCAT 39 Restrictions 77 Forum 39 Statutory restrictions under the Subdivision Act 77 Criteria and tests 39 Creation of restrictions 77 Complexity and timing 40 Why a ‘restriction’ on a plan of subdivision Involvement of councils and referral is not a restrictive covenant 78 authorities 40 Why a restriction on a plan should not Costs 40 take the place of a restrictive covenant 79 Application to public land 41 2 Victorian Law Reform Commission – Easements and Covenants: Final Report 22 The status of restrictive covenants on Regulation as an alternative to removal 108 registered land 80 Regulation of covenants—the New Should restrictive covenants be recorded or South Wales approach 108 registered? 80 Should planning schemes override Identification of benefited land 82 covenants? 109 Positive covenants 84 A model for the regulation of covenants 110 Management of common property Effect of planning permit on enforcement developments 84 of covenants 112 Other ways of imposing positive Covenants that are inconsistent with a law 112 obligations on successors 85 Chapter 8: Removal and Variation of Submissions 86 Easements and Covenants by Order 115 Conclusion 87 Overview 116 Statutory scheme for covenants 88 What can be removed or varied under section 84? 116 Limiting the duration of restrictive covenants 88 Restrictive covenants and restrictions 116 Renegotiability and information overload 88 Statutory agreements 117 Submissions 89 Easements 117 Discussion 90 Relationship with provisions for Existing restrictive covenants 91 administrative removal 118 Restrictions and section 173 agreements 91 Where should the applications be heard? 119 Chapter 7: Easements and Covenants Submissions on choice of forum 119 under Planning Law 93 Discussion on choice of forum 120 Introduction 94 Power to make a declaration 121 Mechanisms for removal or variation under Costs 122 planning legislation 94 Reformulation of the power 123 Removal or variation by planning scheme 95 Threshold tests or relevant considerations? 123 Removal by a permit to remove or vary 95 Recommended list of relevant Removal and variation of easements 96 considerations 124 Removal or variation by permit 96 Relevant planning scheme 124 Removal under section 36 of the Purpose of the easement or restrictive Subdivision Act 96 covenant and changed circumstances 125 Removal and variation of restrictive covenants 98 Increased burden of easement 126 Development of the current law 98 Material detriment 127 Confusion of laws rather than Extent to which compensation would coordination of processes 102 be adequate 128 Submissions on the removal and variation Acquiescence and delay 128 of restrictive covenants under planning law 102 Abandonment and non-use of easement 129 Covenants as a relevant consideration 103 Other factors 130 Should councils be responsible for Release from contractual obligations 130 enforcement of covenants? 105 The impact of covenants on the Appendix: Submissions 132 implementation of planning policies 106 Bibliography 134 Removal and variation of covenants by planning scheme amendment 107 3 VICTORIAN LAW REFORM COMMISSION Terms of Reference Chairperson Professor Neil Rees* Commissioner 1) The Victorian Law Reform Commission is to review and report on the Associate Professor Pamela O’Connor* desirability of changes to Victoria’s property laws in relation to— Part-time Commissioners a) the Property Law Act 1958; and Magistrate Mandy Chambers b) easements and covenants. Justice Karin Emerton 2) In conducting the review, the Commission should have regard to— Judge Felicity Hampel* Lynne Haultain • the aims of the Attorney-General’s Justice Statement 2, in Hugh de Kretser particular to simplify and modernise the law, and reduce the costs Professor Sam Ricketson*† associated with the justice system; • relevant, contemporaneous reviews or policies in the field in other Expert Consultative Committee jurisdictions, both within Australia and internationally; Jane Allan, Susan Brennan, Justice Clyde Croft, Robyn Crozier, Rebecca Leshinsky, • opportunities for harmonisation with laws of other Australian Associate Professor Sue MacCallum, jurisdictions; Justice Marcia Neave AO, Phil Nolan • developments in technology, including the availability of Reference Team electronic conveyancing; Lindy Smith (Team Leader), Zane Gaylard • the scope for reducing the administrative and/or compliance Hilda Wrixon, Frankie Barbour (intern), burden imposed on business and the not for profit sector, in line Cara Bredebusch (intern) with the Government’s Reducing the Regulatory Burden initiative; Chief Executive Officer and Merrin Mason • social and demographic trends and new approaches to planning and sustainable land use and risk in Victoria. Operations Manager Kathy Karlevski 3) The purpose of the review is to ensure that the laws under review are transparent, accessible and support an efficient and effective system of Communications Manager property rights and transactions in Victoria. Nicola Edwards 4) In particular, the Commission should consider— Team Leaders Emma Cashen, Lindy Smith • Any necessary changes to ensure that the Property Law Act 1958 is certain, effective and up to date. This may include, but is not Community Law Reform Manager limited to, any reforms required to modernise and/or simplify the Myra White language in the Act, clarify meanings that are in doubt, remove Policy and Research Officers obsolete provisions, or improve the overall functioning of the Act. Zane Gaylard , Kirsten McKillop , Ian Parsons • The operation of the law of easements and covenants broadly, Martin Wimpole, Hilda Wrixon and any beneficial changes to streamline planning processes and/ Research Assistant or relevant property laws and practices, as well as options to Tess McCarthy facilitate simpler and cheaper processes. This should incorporate a consideration of the interrelationship, and opportunities for Publications Officer harmonisation and increased clarity across the rules, practices and Carlie Jennings Acts, including the Transfer of Land Act 1958, Property Law Act Research and Executive Assistant 1958, Subdivision Act 1988 and Planning and Environment Act Mia Hollick 1987, amongst others, that govern easements and covenants. Project Officer and Executive Assistant The Commission is also asked to report on any related issues that are identified Jessica Saunders during the course of the review and that may warrant further investigation. Librarian The Commission is to report regarding the Property Law Act 1958 by 30 September 2010, and to report regarding easements and covenants Julie Bransden by 17 December 2010. Assistant Operations Manager Vicki Christou Administrative Officers Sara Yekenkurul * Commissioners involved in this reference. 4† Retired 30 June 2010 Preface In August 2009, the former Attorney-General asked the Commission to review Victoria’s property laws. The first component of the reference was a review of the Property Law Act 1958 (Vic), which the Commission completed in September 2010. This report, which deals with the law of easements and covenants, concludes the reference. Easements and restrictive covenants gained recognition as private property rights well before land use and planning legislation emerged. They now exist alongside a variety of powers and restrictions created under the umbrella of planning legislation and enforced by various public entities. The interaction
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