Moreton Bay Regional Council v Mekpine Pty Ltd: Resumption of Land and Compensation

Today (10 March 2016) in Moreton Bay Regional Council v Mekpine Pty Ltd [2016] HCA 7, the High Court of Australia, in a unanimous decision, has allowed an appeal from the Court of Appeal of the Supreme Court of Queensland in Mekpine Pty Ltd v Moreton Bay Regional Council [2014] QCA 317 .

In reaching its decision, the High Court has found that the respondent (Mekpine Pty Ltd - Mekpine), the holder of a retail lease in a shopping centre on certain land (Lot 6) that was later amalgamated with an adjacent lot of land (Lot 1), did not acquire an interest over the entire amalgamated lot (New Lot 1). As a result, the High Court has held that Mekpine was not entitled to compensation under the Acquisition of Land Act 1967 (Qld) (ALAct) when part of  the New Lot 1 that was previously part of former Lot 1 was resumed by the appellant (the Moreton Bay Regional Council- the Council).

Background and History

In March 1999, Mekpine entered into a retail shop lease (the lease) under the Retail Shop Leases Act 1994 (Qld) (the RSLAct). The lease was for Lot 6 on RP 809722.

At that time, Lot 6 was the site of a retail shopping centre (the Shopping Centre) within the meaning of the RSLAct and under the lease, Mekpine had the right to occupy and use part of a building constructed on Lot 6, referred to as the “common areas” of the lease and identified as being those parts of Lot 6 not leased by the lessor.

In 2007, the Shopping Centre expanded to include a retail development on adjoining land identified as Lot 1 on RP 847798 (old Lot 1) and at that time, Lot 6 and old Lot 1 were amalgamated by the registration of a plan of survey and existing interests under the Land Title Act 1994 (Qld). This created Lot 1 on SP 184746 (the New Amalgamated Lot 1).

By November 2008, the Council resumed part of the New Amalgamated Lot 1 (the Resumed Land) under the provisions of the ALAct. The resumed land had previously formed part of the old Lot 1 and had never been part of Lot 6. Mekpine then brought an action claiming compensation under the ALAct on the basis that, at the date of resumption, it had an interest in the Resumed Land for the purposes of the ALAct section 12(5).

In the Land Court of Queensland

On 10 September 2012, the Land Court of Queensland (see Mekpine Pty Ltd & Anor v Moreton Bay Regional Council [2012] QLC 46) determined a preliminary point as to whether, as at the date of resumption, Mekpine had an interest in the Resumed Land for the purposes of the ALAct section 12(5) a decision involving determination of the following:

(a) Whether the amalgamation of Lot 6 with Old Lot 1 varied the lease to extend an interest over all of New Amalgamated Lot 1, including parts of New Amalgamated Lot 1 beyond the land that was previously within Lot 6; and

(b) Whether the provisions of the RSLAct varied the lease, or otherwise operated, to include an interest in parts of the New Amalgamated Lot 1 identified by the RSLAct as “common areas” for the Shopping Centre.

Question (a) was answered in the negative by the Land Court of Queensland but question (b) was answered in the affirmative, with the Land Court finding that Mekpine had a relevant interest in the Resumed Land.

The Council then appealed to the Land Appeal Court of Queensland (see [2013] QLAC 5 (25 October 2013) and (No. 2) [2014] QLAC 5 (24 July 2014)), which answered both questions ((a) and (b)) in the negative.

In the Queensland Court of Appeal

Mekpine then appealed to the Queensland Court of Appeal (Mekpine Pty Ltd v Moreton Bay Regional Council [2014] QCA 317) and on 2 December 2014 the Queensland Court of Appeal (McMurdo P;  Morrison and Holmes JJA, with Holmes JJA dissenting) allowed the appeal. In that case, the majority found that the registration of the plan of survey to create New Amalgamated Lot 1 and/or the registration of existing interests in Lot 6 on the title of the New Amalgamated Lot 1 varied the lease to include all of New Amalgamated Lot 1.

The Queensland Court of Appeal further found that, the provisions of the RSLAct operated to vary the lease to include areas defined by the RSLAct as “common areas”, or otherwise created an interest in the “common areas” as defined by the RSLAct.

In contrast to the majority, Holmes JA, found that neither the amalgamation nor the provisions of the RSLAct created any interest in land, within the meaning of the ALAct section 12(5), beyond the existing interests in land within the former boundaries of Lot 6.

The High Court Appeal

Special leave to appeal to the High Court was granted on 16 October 2015 (see also [2015] HCATrans 323 (8 December 2015) and [2015] HCAASP 46 (8 December 2015)).

In the High Court, the key grounds of appeal were that the Queensland Court of Appeal erred in determining that Mekpine had an interest in land resumed by the  Council on 14 November 2008, being part of Lot 1 on SP 184746, for the purposes of the ALAct section 12(5), in that the Court wrongly found that registration of a plan of survey to create a new lot by the amalgamation of two existing lots and/or the registration of existing interests in the two existing lots on the title of the new amalgamated lot varied Mekpine’s lease over just one of the existing allotments to include a leasehold interest over all of the new amalgamated lot.

The High Court in unanimously allowing the appeal, held that:

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Moreton Bay Regional Council v Mekpine Pty Ltd [2016] HCA 7 (9 March 2016) and High Court Case Summaries.

Mekpine Pty Ltd & Anor v Moreton Bay Regional Council [2012] QLC 46

Mekpine Pty Ltd v Moreton Bay Regional Council [2014] QCA 317

Qld - Acquisition of Land Act 1967; Land Title Act 1994; Retail Shop Leases Act 1994 as reported in the TimeBase LawOne Service