Massons

A tale of two wind farms

Written by Joseph Consalvi and Jude Kassas on September 7, 2022

Two recent opposing decisions of the NSW Supreme Court and the Victorian Supreme Court (Court of Appeal) have highlighted the importance of ensuring that lease provisions regarding the ownership of tenant’s chattels are drafted as accurately as possible. Whilst these decisions are set in the context of wind farms, the take-away message is that lease documents generally should be clear about the parties agreed intention as to ownership of any chattels brought onto the premises.

The two judgments revisit the law of fixtures, of which the key legal principle is that in determining whether particular assets are chattels or fixtures the objective intention of the parties must be ascertained, having regard to the degree of annexation of those particular assets and the purpose or object of the annexation. The main implication being that if a chattel has become a fixture the item becomes part of the land / the landlord’s property and the landlord has legal title to it.
In the AWF Case, the wind turbines and certain associated wind farm infrastructure (‘assets’) were held by the Court to be chattels (and not fixtures/improvements to the land) based primarily on the following factors:

  • the lease and planning permit required the tenant to remove the assets
  • the tenant was entitled under the lease to renew, replace or remove the assets during the lease term
  • the assets were designed and installed in a way that allowed them to be removed without damaging either the assets or the land
  • the design working life of the turbines corresponded with the lease term
  • the second-hand value of the assets was greater than or equal to the cost of removing them
  • in any event, there is specific legislation in Victoria which overrides the common law position and deems the assets as being items owned by the tenant

The decision in the AWF Case contrasts the earlier decision in the SPIC Case where it was held that similar wind farm assets became fixtures (albeit tenant’s fixtures which entitle the tenant to remove the assets from the land). Although the respective Courts’ viewed certain facts differently, one minor but legally significant point of difference was the divergence on whether the removal of the turbines / turbine foundations would cause any substantial damage to the surrounding land.

In addition, a further legally important difference was in relation to the weight that each Court gave to the respective lease provisions. The Victorian judges found it acceptable to place more emphasis on the lease provisions when determining the parties’ objective intentions. However, the NSW judges considered that less reliance should have been placed on the lease provisions.

The above decisions demonstrate the importance of clear drafting in lease documents, to minimise the risk of costly and protracted disputes and the uncertainty in leaving such matters to be decided in Court. If anything, careful and accurate drafting would provide some valuable supporting evidence towards assessing the parties’ objection intentions, particularly within the above context of high value renewable energy development infrastructure.

Insights

"Excellence Awardee" - Boutique Firm of the Year - 2022 Australasian Law Awards

We are delighted that Massons has been selected as an “Excellence Awardee” in the category of “Boutique Firm of the Year” at the 2022 Australasian Law Awards.

Thank you to all of our wonderful clients who have supported our nomination in this category, and to our amazing lawyers and support staff for making this possible!

Wishing all the other Awardees the best of luck and looking forward to the Gala Dinner.  A night out with our team is always cause for celebration – win, lose or draw!!

March 23, 2022

Doyle's Guide 2022

We are excited about our inclusion in Doyle’s Guide for 2022 for NSW in the following categories:

Massons – Leading Property & Real Estate Law Firms
Jodie Masson – Leading Property & Real Estate Lawyers and Leading Leasing Lawyers
Leisha de Aboitiz – Leading Property & Real Estate Lawyers and Leading Leasing Lawyers
Ben Malone – Property & Real Estate Law Rising Stars

Thank you to all of our peers and wonderful clients who have helped to achieve this recognition.

March 14, 2022

"Rising Stars" Australasian Lawyer 2022

February 28, 2022

Appointment as Senior Associate

We are excited to announce the appointment of Alex Ho as a Senior Associate at Massons.  Alex started with us as a paralegal and has achieved this milestone in record time due to his hard work, his ability to develop and sustain fantastic relationships with clients, his engagement in constantly seeking to improve himself and others in equal measure, and his absolutely infectious enthusiasm.  We couldn’t be prouder!  Congratulations Alex!

January 5, 2022

Australian Lawyer's Elite Women List 2021

December 8, 2021

We are excited to have been named as finalists in several categories in the Lawyers Weekly “Women in Law Awards 2021”:

– Massons – “Boutique Diversity Law Firm of the Year”
– Ole Mitrevski – “Senior Associate of the Year – SME Law”
– Michelle Mon – “Rising Star of the Year – SME Law”
– Nicole Caryofyllis – “Legal Support Professional of the Year”

We are proud to be recognised as a Firm which supports diversity in the workplace and are humbled to be included in the list of finalists in these categories. Win or lose, we are looking forward to celebrating the Awards night and would love to thank our peers and clients who have helped us achieve this recognition.

October 12, 2021

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Email: property@massons.com