Blackburn v Logos Research Institute Pty Ltd - [2015] SADC 175

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
BLACKBURN & ANOR v LOGOS RESEARCH INSTITUTE PTY LTD & ORS
[2015] SADC 175
Judgment of His Honour Judge Slattery
23 December 2015
EQUITY - EQUITABLE REMEDIES - SPECIFIC PERFORMANCE
Application by the plaintiffs under 6DCR Rule 232(1), (2) and Rule 233 for summary judgment and for specific performance of a settlement agreement alleged to have been made between the plaintiffs and the first defendant on 12 September 2014. The settlement agreement is alleged to have compromised the whole of the plaintiffs’ claims against the defendant arising under an action for private nuisance.
Whether the plaintiffs and the first defendant made a contract of settlement on 12 September 2014 and if so, the terms of that contract.
Whether, in the event that a settlement contract was made, there is no reasonable basis for the first defendant to defend the claim of the plaintiffs for summary judgment.
Whether, if a contract of settlement was made and there is no reasonable basis for the first defendant to defend the claim of the plaintiffs, the plaintiffs have also satisfied the requirements for an award of specific performance.
Whether, if a settlement contract was made, and there is no reasonable basis for the first defendant to defend the claims of the plaintiffs and the plaintiffs have satisfied the requirements for an award of specific performance, the Court would exercise its discretion to grant summary relief.
Whether the existence of a Counterclaim by the first defendant meant that the Court was not in a position to make any finding under Rule 232 or Rule 233 or exercise any discretion upon making such a finding.
Held:
1. The plaintiffs and the first defendant made an enforceable contract on 12 September 2014;
2. The terms of the contract between the plaintiffs and the first defendant are reflected in the contents of the letter of offer of the first defendant’s solicitor to the plaintiffs’ solicitors dated 11 September 2014 and the letter of acceptance from the plaintiffs’ solicitor to the first defendant’s solicitor dated 12 September 2014;
3. There is no reasonable basis for the first defendant to defend the claim of the plaintiffs; that a settlement agreement has been made between them;
4. The plaintiffs have failed to address the question of the requirements for an order for specific performance especially whether common law damages are inadequate and whether any discretionary factors militate against the grant of an order for specific performance;
5. It is necessary for the Court to hear further submissions on the question of whether it is in a position to make an order for specific performance of the contract of 12 September 2014 made between the plaintiffs and the first defendant;
6. The Court is not in a position to make an order for summary relief on the application for specific performance.
7. It was not necessary to postpone the making of findings on the plaintiffs' application subject to the disposition of the first defendant's Counterclaim.
District Court Rules 2006. Rule 232, Rule 233 ; Development Act 1993 s69 ; Salmond’s Law of Torts 5th ed. 1920 at pp258-265; Oliver Wendall Holmes: “The Path of the Law” (1897) 10 Harvard Law Review 457 ; John Murphy: The Law of Nuisance 2010 Oxford University Press at paragraph 6.31, referred to.
Estate of late Sir Donald Bradman v Allens Arthur Robinson (2010) 107 SASR 1; Sedleigh-Denfield v O’Callaghan and Ors [1940] AC 880; SJ Weir v Bijok and Anor. [2011] SASCFC 165 ; XIV Commonwealth Games v ABC (1988) 18 NSWLR 540; Masters v Cameron (1945) 91 CLR 353; Zhu v Treasurer of New South Wales (2004) 218 CLR 530 , applied.
Tabcorp Holdings Limited v Bowan Investments Limited (2009) 236 CLR 272 , discussed.
Ceneavenue Pty Ltd v Martin (2008) 106 SASR 1; Spencer v The Commonwealth (2010) 241 CLR 118; Davies v The Minister for Urban Development and Planning (2011) 109 SASR 518; Batistatos v Roads and Traffic Authority of New South Wales (2006) 226 CLR 256; Proude v Visic (No. 4) (2013) 117 SASR 560; JT Nominees Pty Ltd v Macks (2007) 97 SASR 471 ; Proude v Visic (No. 4) (2013) 117 SASR 560; Elston v Dore (1982) 149 CLR 480; Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520; Rylands v Fletcher (1866) LR 1 Ex 265; Transco PLC v Stockport Metropolitan Borough Council [2003] 3 WLR 1467; Bankstown City Council v Alamdo Holdings Pty Ltd. (2005) 223 CLR 660 ; Marcic v Thames Water Utilities Limited [2004] 2 AC 42; Harrington (Earl of) v Derby Corporation [1905] 1 Ch 200; Goldman v Hargrave [1966] 115 CLR 458 ; Hargrave v Goldman [1963] 110 CLR 40 ; Job Edwards Limited v Birmingham Navigations [1924] 1 KB 341; Torett House Pty Ltd v Berkman (1940) 62 CLR 637; Pontardawe Rural District Council v Moore-Gwyn [1929] 1Ch 656 ; Sparke v Osborne (1908) 7 CLR 51; Giles v Walker (1890) 24 QBD 656; Leakey v National Trust for Places of Historic Interest or Natural Beauty [1980] QB 495; Yared v Glenhurst Gardens Pty Ltd (2002) 10 BPR 19; Hardoon v Belilios [1901] AC 118; GR Securities v Baulkham Hills Private Hospital (1986) 40 NSWLR 631 ; Electricity Generation Corporation v Woodside Energy Limited (2014) 306 ALR 25; Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37; Sinclair, Scott & Co Ltd v Naughton (1929) 43 CLR 310 ; Godecke v Kirwan (1972-73) 129 CLR 629; Tasman Capital Pty Ltd v Sinclair [2008] NSWCA 248; Branir v Awston Nominees (No 2) (2001) 117 FCR 424 ; Humphris-Clarke v Lazaridis [2010] NSWSC 318 ; Coulls v Bagot’s Executor and Trustee Co Limited (1967) 119 CLR 460; Mehmet v Benson (1965) 113 CLR 295 ; Foran v Wight (1989) 168 CLR 385; Legione v Hateley (1983) 152 CLR 406 ; Maralinga Pty Ltd v Major Enterprises Pty Ltd (1973) 128 CLR 336; Dowsett v Reid (1912) 15 CLR 695; Summer v Cocks (1927) 40 CLR 321; Sydney Consumers Milk and Ice Co Limited v Hawesbury Dairy and Ice Society Limited (1931) 48 WN 127 ; Insurance Society Limited v Argyll Stores (Holdings) Limited [1998] AC 1; Patrick Stevedores Operations No. 2 Pty Ltd v Maritime Union of Australia (No. 3) (1998) 195 CLR 1; Beswick v Beswick [1968] AC 58 ; Trident General Insurance Co Limited v McNiece Bros. Pty Ltd (1988) 165 CLR 107 ; Waterways Authority of New South Wales v Cole and Allied (Operations) Pty Ltd [2007] NSWCA 276; Mayo Group International Pty Ltd v Hudson Respiratory Care Inc. [2005] NSWSC 445; McLaren v Schuit (1983) 33 SASR 139 ; McCallum v Country Residences Limited [1965] 2 All ER 364; Greene v Rozen [1955] 2 All ER 797; Roberts v Gippsland Agricultural and Earthmoving Contracting Co. Pty Ltd [1956] VLR 555, considered.

BLACKBURN & ANOR v LOGOS RESEARCH INSTITUTE PTY LTD & ORS
[2015] SADC 175
JUDGE SLATTERY

The plaintiffs make application for summary judgment in this action under Rule 232 and Rule 233 of the District Court Rules 2006. The plaintiffs seek orders based upon an agreement alleged to have been reached between the parties on 12 September 2014. The first and third defendants did not attend the hearing of this application. I am satisfied for the reasons set out below that both of these defendants were given appropriate and sufficient notice of the hearing of this application. As will become apparent I have approached the making of my decision in this matter by also keeping in mind the arguments that may otherwise have been made by and on behalf of those defendants. By leave of the Court, the second defendant (by counterclaim) was excused from attending the hearing of this application.
The application of the plaintiffs (FDN 88) reads as follows:
The plaintiffs apply for the following orders and directions:-
1. For summary judgment pursuant to District Court Rule 232 by way of specific performance of the agreement dated 12 September 2014 and referred to in the affidavit of Brian Arthur Blackburn and Lynette Anne Blackburn sworn 13^th day of October 2015 and accompanying this application.
2.   In the alternative, for preliminary hearing or determination of the enforceability of the agreement referred to in paragraph 1 hereof in advance of the trial of this action.
3.   Costs of and incidental to the within application.
4.   For such further or other order or direction as the Court deems just.
As the application progressed, the plaintiffs developed their arguments under paragraph one of their application. The plaintiffs did not pursue order number two.
The following issues arise for my consideration on this application:-
1.   Whether the plaintiffs and the first defendant made a contract on 12 September 2014.
2.   If yes to question 1, what are the terms of that contract.
3.   If yes to question 1 and on the assumption that question 2 is answered in the affirmative, whether there is no reasonable basis for the first defendant to defend the claim of the plaintiffs.
4.   If yes to paragraph 3 whether the plaintiffs have satisfied the five requirements for an award of specific performance namely:-
4.1 Common law damages are inadequate;
4.2 There is an enforceable agreement;
4.3 There is a breach of the enforceable agreement;
4.4 It must be possible for the agreement to be performed;
4.5 A consideration of the relevant discretionary factors does not militate against the making of an order for specific performance.
5.   If yes to question 4, whether the Court would exercise its discretion under R232(1) of 6DCR (2006).
6.   Whether the claims made upon the Counterclaim are merged into the settlement and insofar as there is no merger of any issue on the Counterclaim, whether that fact requires the Court to postpone its consideration of the plaintiffs’ application.
In support of the application, the plaintiffs read and rely on the following affidavits and other materials:-
The 12^th affidavit of John Wayne Abbott sworn 9 November 2015 (FDN92). This affidavit proves service upon the first defendant of the application for summary judgment and the affidavits in support of that application.
FDN88, the application for summary judgment.
The 3^rd affidavit of Brian and Lynette Blackburn and the exhibits thereto (FDN87).
The affidavit sworn by the plaintiffs on 26 November 2014 (FDN94).
The plaintiffs affidavit sworn 13 October 2015 (FDN87).
The fourth Defence filed by the first defendant (FDN76).
The Defence of the third defendant (FDN77).
The transcript of proceedings of 17 September 2014.
The affidavit of the first defendant sole director Ms E Christi sworn 3 February 2015 (FDN68).
The 3^rd affidavit of the defendant sole director Ms E Christi sworn 8 day of December 2014 (FDN61).
The affidavit of the plaintiffs sworn 10 December 2014 and in particular exhibits BAB17 and BAB18 (FDN63).
For the reasons which are set out below I have reached a conclusion that the plaintiffs are entitled to an order for summary judgment in their favour against the first defendant that the parties entered into a settlement agreement on 12 September 2014 which compromised the plaintiffs’ claim against the first defendant in private nuisance. I set out later in this judgment the terms of the orders that I am prepared to make in this matter.
Rule 232 and Rule 233: a conundrum
The plaintiffs seek summary judgment pursuant to R 232(2)(a) and R 233. Those Rules reads as follows:-
232—Summary judgment
(1) The Court may, on application by a party, give summary judgment for that party.
(2) Summary judgment may only be given if the Court is satisfied that—
(a) if the applicant is a plaintiff—there is no reasonable basis for defending the applicant's claim; or
(b) if the applicant is a defendant—there is no reasonable basis for the claim against the applicant.
233—General discretion as to summary judgment
(1) The Court may, in its discretion, give summary judgment on a particular issue without disposing of the claim as a whole.
(2) If the Court gives summary judgment without disposing of the claim as a whole, the Court may give directions about the determination of the remaining issues and, in the absence of such directions, the action proceeds in the normal way as to the remaining issues.
It is necessary to gather the principles governing the operation of those Rules. They are as follows:-
1.The most recent Full Court decision on the meaning of Rule 232 is the decision in Ceneavenue Pty Ltd v Martin.[1] Debelle J held that the Rule required the Court to identify the issues to be tried and then to assess whether the claim has reasonable prospects of success. That task must be undertaken in a summary determination and the Court is not required to conduct any mini trial on the question.
[1] (2008) 106 SASR 1.
2.In Spencer v The Commonwealth[2] when discussing s31A(2) of the Federal Court Act[3] the plurality, Hayne, Crennan, Kiefel and Bell JJ said at paragraphs [51]-[52] as follows:-
[2] (2010) 241 CLR 118.
[3]    31A Summary judgment
(1)The Court may give judgment for one party against another in relation to the whole or any part of a proceeding if:
(a)the first party is prosecuting the proceeding or that part of the proceeding; and
(b) the Court is satisfied that the other party has no reasonable prospect of successfully defending the proceeding or that part of the proceeding.
(2)The Court may give judgment for one party against another in relation to the whole or any part of a proceeding if:
(a)the first party is defending the proceeding or that part of the proceeding; and
(b) the Court is satisfied that the other party has no reasonable prospect of successfully prosecuting the proceeding or that part of the proceeding.
(3)For the purposes of this section, a defence or a proceeding or part of a proceeding need not be:
(a)hopeless; or
(b)bound to fail;
for it to have no reasonable prospect of success.
(4)This section does not limit any powers that the Court has apart from this section.
(5)This section does not apply to criminal proceedings.
[51] First, the central idea about which the provisions pivot is “no reasonable prospect” (emphasis added). The choice of the word “reasonable” is important. If s 31A is to be seen as deriving from r 24.2 of the Civil Procedure Rules 1998 of England and Wales, its provisions underwent an important change in the course of their translation from that jurisdiction to this. The English rule speaks of “no real prospect”; s 31A speaks of “no reasonable prospect”. The two phrases convey very different meanings.
[52] Second, effect must be given to the negative admonition in sub-s (3) that a defence, a proceeding, or a part of a proceeding may be found to have no reasonable prospect of successful prosecution even if it cannot be said that it is “hopeless” or “bound to fail”. It will be necessary to examine further the notion of “no reasonable prospect”. But before undertaking that task, it is important to begin by recognising that the combined effect of sub-ss (2) and (3) is that the enquiry required in this case is whether there is a “reasonable” prospect of prosecuting the proceeding, not an enquiry directed to whether a certain and concluded determination could be made that the proceeding would necessarily fail.
3.In Davies v The Minister for Urban Development and Planning[4] Bleby J referred to the decision of the plurality in Spencer and the decision of the High Court in Batistatos v Roads and Traffic Authority of New South Wales[5] and, after having compared the similarities between s31A(2) and Rule 232(2) adopted the approach of the plurality in Spencer. Inferentially at least, his Honour considered that the approach of the Full Court in Ceneavenue was, to an extent, inconsistent with the approach of the High Court in Spencer.
[4] (2011) 109 SASR 518.
[5] (2006) 226 CLR 256.
4.At paragraphs [93]-[94] of the decision in Ceneavenue, Debelle J held as follows:-
[93] In JT Nominees Pty Ltd v Macks at [40]-[89], Bleby J considered the meaning and operation of paragraph (b) of Rule 232(2). In doing so he also examined the earlier procedures for summary judgment including the application for immediate relief. He concluded at [86] that paragraph (b) represents a substantial relaxation of the test that had been prescribed by Rule 25.04 of the 1987 Rules. I respectfully agree for the reasons expressed above, reasons which differ slightly from those of Bleby J.
[94] His Honour also held at [87] that when applying the test in paragraph (b) “the court will be guided by similar considerations that have guided the operation of Rule 25.02 of the 1987 Rules”. I respectfully disagree with that conclusion. First, there is now a separate procedure in Rule 119 which deals with applications for urgent or immediate relief. It is to be noted that Bleby J did not at any time refer to Rule 119 in his reasons in JT Nominees Pty Ltd v Macks. Secondly, as is apparent from the reasons above, Rule 25.04 was a new rule which prescribed its own test. While Rule 25.04 might ultimately be traced to Order 10 of the 1947 Rules, it must be recognised that Rule 25.04 was a new rule with its own test. All that paragraph (b) of Rule 232(2) does is substitute a new test different from the test that had hitherto existed. Paragraph (b) was not intended to invoke the considerations that guided applications for urgent or immediate relief. It is also implicit in the reasoning of Bleby J in JT Nominees Pty Ltd v Macks that paragraph (a) of Rule 232(2) will, like paragraph (b) of that rule, be guided by the considerations that have guided the operation of Rule 25.02 of the 1987 Rules. That last conclusion is reinforced by an examination of Bleby J’s reasons on this application for summary judgment. In paragraph 38 of his reasons he has considered factors which apply on an application for immediate relief. For the reasons expressed above, I respectfully disagree. The only question to be considered is whether there is a real question to be tried and whether that question has reasonable as distinct from fanciful prospects of success. Once the court concludes that there are reasonable prospects of success, it must dismiss the application for summary judgment.
5.In Proude v Visic (No. 4)[6] at paragraphs [14]-[19], Blue J held as follows:-
[6] (2013) 117 SASR 560.
[14] In Ceneavenue Pty Ltd v Martin[7] Debelle J (Duggan and Anderson JJ agreeing) said of Rule 232:
[7] [2008] SASC 158; (2008) 106 SASR 1.
Its predecessor was 25.04 … Rule 25.04 spelled out its own requirement for summary judgment, namely, that the plaintiff could not succeed on any possible view of the facts or the law. That test reflected the reasons of Barwick CJ in General Steel Industries Inc v Commissioner for Railways (NSW) …
A comparison of the test in r 25.04 with the test in r 232(2)(b) readily discloses that the burden to be discharged by the defendant on an application under para (b) is lighter than the burden that had to be discharged under r 25.04. The reasoning in General Steel is, therefore, no longer applicable. I respectfully agree with Bleby J that the barrier to summary judgment on an application by a defendant has been lowered: JT Nominees Pty Ltd v Macks (2007) 97 SASR 471 at [61].
While there can be no doubt that para (b) has significantly lightened the burden for a defendant seeking summary judgment, two questions nevertheless remain. The first is what is meant by the expression “no reasonable basis” for the claim against the defendant and the second is whether the test is materially different from the test of a real question to be tried … The test in r 232(2) requires the court first to identify the issues to be tried and then to assess whether the claim or defence has reasonable prospects of success. In the case of an application for summary judgment by a plaintiff against a defendant, it is doubtful, therefore, whether there is a material difference between that test and the former test as it had been expressed in Fancourt. That is because the question whether there is a real question to be tried denoted that the task for the court was to determine whether the issues at the trial are real or fanciful and have reasonable prospects of success.
The question whether there is no reasonable basis for the claim or defence must be determined in a summary way. It is entirely inappropriate for there to be a mini trial on that question. It must, therefore, be evident or obvious that the party defending the application for summary judgment has no reasonable basis for the claim or the defence. While adversarial argument will assist in the determination of that question, the question should be capable of ready resolution without prolonged argument. A prolonged argument might suggest that there is a reasonable basis for the claim or the defence. Comparison with the requirements in rules in other jurisdictions providing for summary judgment confirms these propositions.[8]
[8] (2008) 106 SASR 1 at [79]-[82].
[15] Section 31A of the Federal Court of Australia Act 1976 (Cth) relevantly provides:
(1)     The Court may give judgment for one party against another in relation to the whole or any part of a proceeding if:
(a)     the first party is prosecuting the proceeding or that part of the proceeding; and
(b)     the Court is satisfied that the other party has no reasonable prospect of successfully defending the proceeding or that part of the proceeding.
(2)     The Court may give judgment for one party against another in relation to the whole or any part of a proceeding if:
(a)     the first party is defending the proceeding or that part of the proceeding; and
(b)     the Court is satisfied that the other party has no reasonable prospect of successfully prosecuting the proceeding or that part of the proceeding.
(3)     For the purposes of this section, a defence or a proceeding or part of a proceeding need not be:
(a)     hopeless; or
(b)     bound to fail;
for it to have no reasonable prospect of success.
(Emphasis added)
[16] Section 31A(2)(b) bears a similarity to Rule 232(2)(b). However, the Federal Court provision refers to “no reasonable prospect of successfully prosecuting the proceeding”, whereas this Court’s rule refers to “no reasonable basis” for the claim. The inquiry in the Federal Court is directed to the future and to an assessment of the prospect of success, whereas the provision in this Court is directed to the present and to the basis for the plaintiff’s claim. While there is no equivalent in this Court’s Rules to section 31A(3), the Full Court decided in Ceneavenue that it was not a pre-condition for obtaining summary judgment that a proceeding be demonstrated to be hopeless or bound to fail.
[17] In Spencer v Commonwealth of Australia,[9] the High Court warned against placing a gloss upon the words of section 31A and seeking to substitute judicial formulations.[10] The High Court also said that the exercise of powers to terminate summarily proceedings must always be attended with caution.[11] French CJ and Gummow J said:
[9] [2010] HCA 28; (2010) 241 CLR 118.
[10] (2010) 241 CLR 118 at [22] per French CJ and Gummow J and [58]-[60] per Hayne, Crennan, Kiefel and Bell JJ.
[11] (2010) 241 CLR 118 at [24] per French CJ and Gummow J and [60] per Hayne, Crennan, Kiefel and Bell JJ.
Section 31A(2) requires a practical judgment by the Federal Court as to whether the applicant has more than a “fanciful” prospect of success. That may be a judgment of law or of fact, or of mixed law and fact. Where there are factual issues capable of being disputed and in dispute, summary dismissal should not be awarded to the respondent simply because the Court has formed the view that the applicant is unlikely to succeed on the factual issue. Where the success of a proceeding depends upon propositions of law apparently precluded by existing authority, that may not always be the end of the matter. Existing authority may be overruled, qualified or further explained. Summary processes must not be used to stultify the development of the law. But where the success of proceedings is critically dependent upon a proposition of law which would contradict a binding decision of this Court, the court hearing the application under s 31A could justifiably conclude that the proceedings had no reasonable prospect of success.
Where an application under s 31A requires consideration of apparently complex questions of fact, then the caution uttered by Lord Hope is relevant. The importance of those considerations is amplified if the case involves resolution of issues of law and fact, or mixed law and fact.[12]
[12] (2010) 241 CLR 118 at [25]-[26] per French CJ and Gummow J.
(Citations omitted)
and Hayne, Crennan, Kiefel and Bell JJ said:
How then should the expression “no reasonable prospect” be understood? No paraphrase of the expression can be adopted as a sufficient explanation of its operation, let alone definition of its content. Nor can the expression usefully be understood by the creation of some antinomy intended to capture most or all of the cases in which it cannot be said that there is “no reasonable prospect”. The judicial creation of a lexicon of words or phrases intended to capture the operation of a particular statutory phrase like “no reasonable prospect” is to be avoided. Consideration of the difficulties that bedevilled the proviso to common form criminal appeal statutes, as a result of judicial glossing of the relevant statutory expression, provides the clearest example of the dangers that attend any such attempt.
In many cases where a plaintiff has no reasonable prospect of prosecuting a proceeding, the proceeding could be described (with or without the addition of intensifying epithets like “clearly”, “manifestly” or “obviously”) as “frivolous”, “untenable”, “groundless” or “faulty”. But none of those expressions (alone or in combination) should be understood as providing a sufficient chart of the meters and bounds of the power given by s 31A. Nor can the content of the word “reasonable”, in the phrase “no reasonable prospect”, be sufficiently, let alone completely, illuminated by drawing some contrast with what would be a “frivolous”, “untenable”, “groundless” or “faulty” claim.
Rather, full weight must be given to the expression as a whole. The Federal Court may exercise power under s 31A if, and only if, satisfied that there is “no reasonable prospect” of success. Of course, it may readily be accepted that the power to dismiss an action summarily is not to be exercised lightly. But the elucidation of what amounts to “no reasonable prospect” can best proceed in the same way as content has been given, through a succession of decided cases, to other generally expressed statutory phrases, such as the phrase “just and equitable” when it is used to identify a ground for winding up a company. At this point in the development of the understanding of the expression and its application, it is sufficient, but important, to emphasise that the evident legislative purpose revealed by the text of the provision will be defeated if its application is read as confined to cases of a kind which fell within earlier, different, procedural regimes.[13]
[18] In accordance with the injunction by the High Court, I do not attempt to place a gloss upon the words “no reasonable basis for the claim” or to substitute a judicial formulation for that concept. I disregard the earlier, different, procedural regime under rule 25.04 of the Supreme Court Civil Rules 1987 (SA). I bear in mind that it is necessary that the question whether there is no reasonable basis for the claim be determined in a summary way.
[19] What is a reasonable basis for a claim will vary depending upon the nature and circumstances of the particular claim. I consider whether there is a reasonable basis for the claim separately and independently in relation to the causes of action of breach of duty of care and breach of statutory duty and separately again in relation to the CFS’s defence of statutory immunity from civil liability.
[13] (2010) 241 CLR 118 at [58]-[60] per Hayne, Crennan, Kiefel and Bell JJ.

I will adopt the same approach and in doing so I have kept firmly in mind the judgment of the Full Court in Estate of late Sir Donald Bradman v Allens Arthur Robinson.[14]
[14] (2010) 107 SASR 1.
The R232 and R233 issue arising on the pleadings
Paragraph 25-29 of the third Statement of Claim (FDN72) reads as follows:-
25. By letter dated 11 September 2014 the solicitors then acting for the first defendant offered to settle the within action (“the offer”) in the following terms:
25.1 that the first defendant, at its cost, construct a retaining wall in accordance with the quotation of the retaining wall builder, B&V Colbert (“the builder”) dated 2 July 2014 and the costs estimate of Jeremy Carter dated 31 July 2014 (as amended) an an engineering specification to be obtained by the builder, on its land subject to Mitcham Council planning and approval (“the construction”);
25.2 that the first defendant do all things necessary to obtain the approval of the second defendant;
25.3 that any such application for approval be made within 28 days of the date of acceptance of this offer;
25.4 that on all such approvals being granted the first defendant take all reasonable steps to cause the builder to undertake the construction in a workmanlike manner within 8 weeks;
25.5 the first defendant provide the plaintiffs’ solicitor with a copy of the application to the Mitcham Council and a copy of the approval from the Mitcham Council within 7 days of lodging such application and receiving such approval;
25.6 that the within proceedings be adjourned to a date to be fixed;
25.7 that the plaintiffs erect a galvanised ARC garden safety fence in neutral tones on the entirety of the western boundary of their land to a height of 1.2 metres;
25.8 that the plaintiffs pay the first defendant’s costs of and incidental to the proceedings on a party/party basis as agreed or taxed save as to the costs order made in relation to the vacating of the hearing in December 2013, and the first defendant pay to the plaintiffs the costs of the vacated hearing in the amount of $5,000, or as taxed on a party/party basis.
26. It was an express condition of the offer that the same could be accepted with or without paragraph 25.8 above, and that if agreement was no reached then the matter of costs could be listed for argument.
27. The offer was expressed to be capable of being accepted in writing up to 2.00pm on 12 September 2014.
28. By letter dated 12 September 2014 and before the due time, the plaintiffs accepted the offer save and except for the question of costs (“the agreement”).
29. The plaintiffs rely upon the provisions of the agreement for its full force and effect, and say that the same was entered into by the first defendant with the full knowledge and approval of the third defendant for and on behalf of the third defendant in the first defendant’s capacity as trustee of the Logos Trust in the course of its administration of the said trust.
Paragraph 18 of the Fourth Defence and Counterclaim (FDN76) reads as follows:-
18. As to paragraphs 25, 26, 27 and 28 of the Statement of Claim, the first defendant says:
a. the allegations therein are denied.
b. in the first alternative the first defendant says that the offer was conditional on the plaintiffs providing a copy of all legal fees and disbursements to support the plaintiffs’ assertion that they had incurred $120,000 in legal fees and disbursements and that the plaintiffs have not provided such a copy, and therefore the agreement has terminated on breach of an essential term by the plaintiffs.
c. in the further second alternative the first defendant says that the offer was conditional on the first defendant and the plaintiffs recording terms of settlement in a deed and executing same, and that various draft deeds were exchanged but not finalised and executed, and that there is no agreement.
Particulars
(i)Emails and other communications between the lawyers for the parties.
(ii)The plaintiffs did not address in a practical and conciliatory manner the negotiations to finalise a deed, including a fully installed and operational engineered drainage system on the plaintiffs’ land prior to construction of a retaining wall, and unfettered access to the plaintiffs’ land for construction of a retaining wall.
d. in the further third alternative the first defendant says that implied essential terms of the offer were an obligation for the plaintiffs first to carry out works on the plaintiffs’ land so that water would not collect in the ponds on their land and/or to allow reasonable access to the adjoining land through the plaintiffs’ land so that construction could occur on the adjoining land, and that the plaintiffs have not carried out works so that water does not collect in the ponds and/or the plaintiffs have not allowed reasonable access to their land for construction purposes, so that the agreement has terminated as the plaintiffs breached either one or both of the essential terms.
e. in the further fourth alternative says that the agreement was in principle only and further terms and conditions necessary for proper and full agreement were negotiated but never agreed.
Particulars
(i)The plaintiffs were obligated to address the flow of water from the plaintiffs’ land to the adjoining land before any retaining wall could be constructed.
(ii)The plaintiffs were obligated to address the collection of water in the ponds on the plaintiffs’ land before any retaining wall could be constructed.
(iii)The plaintiffs were obligated to agree to reasonable access over the plaintiffs land to the adjoining land so that construction of the retaining wall could commence.
f. In the further fifth alternative says that the agreement is void for uncertainty as the Particulars (i), (ii) and (iii) above in paragraph 18(e) above are essential to a proper and complete agreement and were not included in the agreement.
g. In the further sixth alternative says that the agreement is void on mistake as the plaintiffs wrongly believed that the agreement for construction of a retaining wall would stop further landslips and such construction would not stop further landslips.
The issue raised and the first defendant’s response
In these pleadings, the plaintiffs assert the existence of a complete, final and binding agreement made by the acceptance by them of the offer of the first defendant. This offer by the first defendant was that it would build a retaining wall. That is a simple enough proposition which is to be analysed in the usual way according to the rules of offer and acceptance. An observation that may be made is that, assessed in light of the other pleadings, the resolution of the issue of the retaining wall by agreement substantially addresses the primary issue in contention between those parties.
The issues raised in the first defendant’s defence deny the existence of a contract, but then it pleads alternatively a number of matters that strike at the heart of whether an agreement was or would be formed. It also pleads material facts that are alleged to be matters that are required to have been addressed under the alleged agreement but were not addressed. There were then further pleadings alleging that the agreement was void for uncertainty because of the absence of the necessary detail required to form a complete final and binding agreement. Finally the first defendant pleads that the agreement is void for a mistake made on the parts of the plaintiffs. That is not a typical plea raised by a defendant but it must be recalled that aspects of specific performance are required to be considered on the plaintiffs’ application.
At first blush it would appear that the pleadings of the first defendant are sufficient to ensure a finding that the matter would be unsuitable for resolution apart from at trial on evidence. It is sufficient to recall the judgment of the Full Court in the Estate of late Sir Donald Bradman[15] in that respect. Notwithstanding, the plaintiffs pressed their application. In doing so, the plaintiffs are taken to have been keenly aware, as the Court is of the judgment of Debelle J in Ceneavenue that a R232 application must not be or become a trial within a trial. This is an application for a summary determination and not a trial of a separate issue arising on the pleadings as a preliminary matter as paragraph 2 of the application is not pressed. Although the common law Court does not frown upon whether there should be a trial of a preliminary issue as the equity Court does upon joint proprietorship, the Court lists are littered with meritorious, worthy but usually unsuccessful applications for such orders.
[15] (2010) 107 SASR 1.
All of that said, the words of the Rules must be given meaning and must operate according to their tenor. And the common law surrounding such applications is well settled. The application is not interlocutory in nature; only relevant and admissible evidence may be received; and the Court must make a decision whether there is no reasonable basis for defending the claim. This includes disposing of a particular issue in the claim: 6R 232 and 233 DCR (2006).
But all of that does not mean that merely because something is difficult or has some complexity that it should automatically be set for trial. Significant decisions arise in every application and as often as not the Court is required to strike a balance between interests. But this is not an application about striking a balance of interests. On the plaintiffs’ application, very limited documents are involved here: a letter of offer and a letter of acceptance. Those are the only two matters to which the Court would have regard in deciding this application. In order to understand the importance of those two documents it is necessary to have a firm grasp of both the relevance of material facts that are not in contention and the principles applicable under the tort of private nuisance. It is also necessary to have regard to the existence of the first defendant’s counterclaim in reaching any decision here.
Preliminary matters
The plaintiffs brought their application in the background of a number of issues and events. It is necessary to discuss these events in detail in order to properly comprehend the plaintiffs’ application and the importance of these matters.
I satisfied myself during the course of the hearing that the plaintiffs through their solicitors Wayne Abbott Pty Ltd had made adequate attempts to serve the first and third defendants with notice of the hearing of this application. Mr John Wayne Abbott, solicitor, swore an affidavit on 9 November 2015 (FDN92) which deposed to the following matters:-
I JOHN WAYNE ABBOTT of level 10, 50 Pirie Street, Adelaide in the State of South Australia, Solicitor, SWEAR ON OATH THAT:
1.   I am the solicitor for the plaintiffs in this matter.
2.   On the 30^th day of October 2015 I sent an email to the email address of the third defendant. A copy of that email is exhibited hereto and marked “JWA25”.[16]
3.   On the 30^th day of October 2015 I forwarded letters by ordinary prepaid post to the third defendant informing her of the hearing in this matter on 11^th November 2015. The letters were addressed to the third defendant at 30 Aldgate Valley Road Aldgate and at 18 Hannaford Road Blackwood. Copies of the letters are exhibited hereto and marked “JWA26”.[17]
4.   On the 2^nd day of November 2015 I delivered a letter to the registered office of Logos Research Institute Pty Ltd informing that company of the time of hearing of this matter. The person I spoke to informed me that her name was “Sara” and she said that she would give the letter to “Tim”. A copy of that letter is exhibited hereto and marked “JWA27”.[18]
[16] Exhibit JWA25
Dear Ms Christi,
The plaintiffs’ application for summary judgment in this matter is set down for hearing before his Honour Judge Slattery at 9.30 a.m. on Wednesday 11^th November 2015 in the District Court.
Wayne Abbott
Wayne Abbott Pty Ltd
[17] Exhibit JWA26
Ms E. Christi
18 Hannaford Road
Blackwood SA 5051
Dear Madam,
RE: BLACKBURN & BLACKBURN v LOGOS RESEARCH INSTITUTE PTY LTD, SA WATER & CHRISTI
The hearing of the plaintiffs’ application for summary judgment will be heard at 9.30 a.m. on Wednesday 11^th November 2015 in the District Court.
Yours faithfully,
WAYNE ABBOTT PTY LTD
Ms E. Christi
30 Aldgate Valley Road
Aldgate SA 5154
Dear Madam,
RE: BLACKBURN & BLACKBURN v LOGOS RESEARCH INSTITUTE PTY LTD, SA WATER & CHRISTI
The hearing of the plaintiffs’ application for summary judgment will be heard at 9.30 a.m. on Wednesday 11^th November 2015 in the District Court.
Yours faithfully,
WAYNE ABBOTT PTY LTD
[18] Exhibit JWA27
The Director
Logos Research Institute Pty Ltd
C/- Campbell Law
Suite 7, Level 1
118 Halifax Street
Adelaide SA 5000
Dear Sir,
RE: BLACKBURN & BLACKBURN v LOGOS RESEARCH INSTITUTE PTY LTD, SA WATER & CHRISTI
The hearing of the plaintiffs’ application for summary judgment will be heard at 9.30 a.m. on Wednesday 11^th November 2015 in the District Court.
Yours faithfully,
WAYNE ABBOTT PTY LTD
I have reviewed the content of each of the letters and materials exhibited to the affidavit of Mr Abbott. It is necessary that I do so for a number of reasons two of which are predominant. It is first necessary that I be satisfied that this application has been brought to the attention of both of those defendants because for a number of months, these defendants have appeared in Court through the third defendant, who is the sole director of the first defendant. The first defendant is the trustee of a bare trust and the third defendant is the sole beneficiary of that trust. It is essential that I be satisfied that the first defendant is cognisant of this application. The importance of that consideration is emphasised by the second which is that since Campbell Law ceased acting as solicitors on file for the first defendant, there has been no address for service filed on its behalf. The same position pertains to the third defendant. I am satisfied from all of the affidavit material filed by the plaintiffs that everything that could possibly be done has been done to bring this application to the notice and attention of the first (and therefore necessarily the third) defendant.
As I am satisfied that the plaintiffs have done all they could to ensure that the first and third defendants had notice of the hearing of the application it is inappropriate to speculate about why there was no appearance for those defendants. I must be satisfied that the application has been served upon the defendants; that they are cognisant of the fact of the application; and that they have had sufficient time to obtain a proper understanding of the application and have had sufficient time to consider it, obtain advice and respond. I am satisfied of all of these matters. Before the commencement of hearing the application I also required an all Courts call to be made three times throughout the Court building. There was no response.
The uncontentious background facts
This action concerns properties in the Blackwood area in the southern foothills of Adelaide immediately above the Adelaide Plain. The area is very hilly with an undulating topography. The property owned by the plaintiffs is contiguous with and sits above the defendant’s property. The defendant’s property adjoins the rear of the plaintiffs’ land and lies to the west of the rear boundary of the plaintiffs’ land.
The plaintiffs are the registered proprietors of the property more commonly known as 9 Tester Drive, Blackwood. It is the whole of the land comprised in Certificate of Title Register Book Volume 5337, Folio 885. The plaintiffs’ property faces east towards Tester Drive. The plaintiffs purchased their property in 1971. The defendant’s property is to the rear and therefore to the west of the plaintiffs’ property.
The first defendant (in its capacity as the trustee of a trust) became the registered proprietor of the property more commonly known as 18 Hannaford Road, Blackwood in 2006. It is the whole of the land comprised in Certificate of Title Register Book Volume 5679, Folio 131. The defendant’s property faces west towards Hannaford Road and sits below and to the east of the plaintiffs’ property. The topography is that the hill on which the plaintiffs house property sits falls naturally from the plaintiffs’ land through the defendants’ land.
The plaintiffs’ property slopes from the south east to the north west and therefore across the land owned by the first defendant. Immediately west of the boundary of the two properties, there is a four metre wide easement to the Minister for Infrastructure and a sewerage pipe is contained within that easement.
In 1991, the then registered proprietor of the first defendant’s land excavated part of the land to create a half-court sized tennis court. That excavation cut two metres into the easement and removed part of the soil within the easement. The excavation created what is commonly described as a vertical batter slope approximately two metres from the boundary of the plaintiffs’ land. The area of land within the easement granted to the Minister sits within portion of the cutting made for the tennis court.
The depth of the excavation for the half-court tennis court increased as the excavation moved from north to south. At its deepest point, the excavation is about five metres deep and at its shallowest point, it is about three metres deep.
On 9 September and 11 October 1992, there were land slips along the vertical batter face on the first defendant’s land. The unchallenged evidence of the plaintiffs is that the top of the batter face slipped away but, consistently, each land slip reduced the amount of soil remaining in the sewerage easement with the effect that the batter face was brought closer to the boundary of the plaintiffs’ land. In an attempt to ameliorate the land slippage, after 1992 a chicken wire covering was placed over the batter slope and creepers were grown over the wire.
The first defendant purchased the Hannaford Road property in 2006 and after that date a land slippage occurred. On 7 September 2010 a further slippage occurred with the effect that the sewerage pipe in the sewerage easement was fully exposed and a portion was left unsupported.
The slippage which exposed the sewerage pipe was reported to United Water which took measures to support the sewerage pipe by attaching ropes to star pickets which were placed on the plaintiffs’ land and it also was forced to redirect sewage through other available piping in the area. On 8 March 2011 the Mitcham Council issued an emergency order under s69 of the Development Act to the first defendant.[19] The first defendant brought an appeal against that order in the Environment Resources and Development Court. The defendant was unsuccessful in its appeal and following the disposition of the appeal, the first defendant was required to erect a fence on the plaintiffs’ land and to place warning signs on the fence. A two strand wire fence bearing a sign reading “excavation do not enter” was erected near the border of the plaintiffs’ land and about one metre inside the boundary of the plaintiffs’ and the first defendant’s land.
[19] EMERGENCY ORDER
SECTION 69 DEVELOPMENT ACT 1993
RECITALS:
1.You are the owner of the land comprised within Certificate of Title Register Book Volume 5679 Folio 131 being the land known as 18 Hannaford Road, Blackwood (Land).
2.Located at the rear of the Land is a tennis court along with an existing easement which said easement is four metres wide and is in favour of the Minister for Infrastructure (Easement).
3.Located within the Easement is existing infrastructure currently being used for the disposal of sewage.
4.Prior to April 1991, an extensive excavation was undertaken at the rear of the Land for the purpose of the construction of the said tennis court. At the time the excavation was undertaken it was approximately 37 metres in length, 14 metres in width with a varying depth of 3 to 4 metres (Excavation).
5.The Excavation encroaches into the Easement.
6.I inspected the Land on 10 September 2010. At that time, it appeared to me that the Excavation has become unstable. At that time there was evidence that a section of the Excavation had collapsed. The said infrastructure located within the Easement is also exposed.
7.I am an authorised officer holding prescribed qualifications pursuant to Section 69 of the Development Act 1993.
8.I am of the opinion that an Emergency Order is necessary because of a threat to safety arising out of the Excavation. In particular, the Excavation is unstable and may collapse or result in landslip which may compromise the safety of the occupants of the Land and the occupants of the land to the rear of the Land located at 9 Tester Driver Blackwood.
9.I consider it necessary that you take action in relation to this threat to safety.
NOW TAKE NOTICE that pursuant to Section 69 of the Development Act 1993 you are directed to:
1.On or before Wednesday 16 March 2011, erect a temporary barrier in the form of fencing or similar on the tennis court located on the Land in the area immediately adjacent the Excavation so as to prohibit any persons that are occupying the Land from being in close proximity to the Excavation.
2.On or before Wednesday 16 March 2011, erect a temporary barrier in the form of fencing or similar at the rear of the adjacent land located at 9 Tester Drive, Blackwood in the area immediately adjacent the Excavation so as to prohibit any persons occupying the land at 9 Tester Drive Blackwood from being in close proximity to the Excavation.
3.On or before Friday 30 September 2011, suitably make safe the Excavation in accordance with the directions of a suitably qualified civil or structural engineer (the Works).
4.Upon completion of the Works, provide the Council with a certification, in writing, from a suitably qualified civil or structural engineer confirming that the Works have been undertaken to their satisfaction.
Dated 8 March 2011.

The order of the Environment Resources and Development Court also required the first defendant to make the excavation safe in accordance with the directions of a suitable qualified civil or structural engineer on or before 31 October 2011. Upon completion of the works, the first defendant was required to provide the Mitcham Council with a written certification from the engineer confirming that the work had been done to the engineer’s satisfaction.
In October 2011, SA Water removed the soil and debris from the base of the excavated batter face, removed other soil from the crest of the batter slope, then removed soil to a depth of approximately one metre adjacent to the half‑court tennis court, installed free-standing supports in the shape of an inverted L-frame gantry and then attached the sewerage pipe to the underneath of the cross member of the gantry. On 31 October 2011, Golder and Associates, provided a report that the batter slope had been made safe.
Upon provision of the final report of Golder and Associates, the plaintiffs instructed TMK Consulting Engineer and the Mitcham Council obtained a report from Coffey Geotechnics. On 4 July 2013 the Mitcham Council issued a further emergency order under s69 of the Development Act. The content of that emergency order reads as follows:-
EMERGENCY ORDER
SECTION 69 DEVELOPMENT ACT 1993
RECITALS:
1.   The Company is the owner, as trustee of The Logos Trust, of the land comprised within Certificate of Title Register Book Volume 5679 Folio 131 being the land knows as 18 Hannaford Road, Blackwood (Land).
2. I have been appointed by the City of Mitcham (the council for the area in which the Land is located) (Council) as an authorised officer under Section 18(1) of the Development Act 1993. My appointment is not subject to any relevant conditions.
3. I hold the prescribed qualifications required by Section 69(1a) of the Development Act 1993 as set out in Regulation 87(3) of the Development Regulations 2008.
4.   Located at the rear of the Land is a half-court tennis court.
5.   Prior to April 1991, an excavation was undertaken for the purpose of the construction of the said tennis court (Excavation). At the time the Excavation was undertaken it was approximately 37 metres in length, 14 metres in width with a varying depth (or wall face height) of up to 4 metres.
6.   The face of the Excavation has been subject to landslip since that time.
7.   I have been provided with a geotechnical assessment report 07217AA.AB from Coffey Geotechnics Pty Ltd authored by John Slade, Associate Geotechnical Engineer, dated 15 May 2013 (Report).
8.   The Report concludes that:
8.1   A major extent of damage has already occurred at the Land due to the Excavation;
8.2   Land subsidence has progressed into the SA Water Easement adjacent the tennis court and has recently extended/inclined into 9 Tester Drive;
8.3   The process of erosion and weathering will continue to result in subsidence of the Excavation;
8.4   The likelihood of a landslide occurring in the next 10 to 20 years is almost certain;
8.5   Such landslide will require large stabilisation works;
8.6   Such landslide will cause minor damage;
8.7   Land subsidence along the full length of 9 Tester Drive boundary is highly probable within a 10 to 20 year design life; and
8.8   The extent of land subsidence can be minimised by engineering controls.
9. In light of the foregoing, I am of the opinion that an order under Section 69 of the Development Act 1993 is necessary because of a threat to safety arising out of the condition [of] the Excavation.
10.   I consider that the threat to safety comprises:
10.1 A risk of landslide or land subsidence depositing material upon the occupants of and visitors to the Land causing personal injury; and
10.2 A risk of landslide or land subsidence altering the top edge of the Excavation so that it appears at an unfenced or unprotected location at 9 Tester Drive, Blackwood thus presenting a fall hazard to occupants of and visitors to that land which, if someone were to fall into the Excavation, could cause serious personal injury or death.
11.   I consider it necessary to require the Company, as owner of the Land, to do certain things in relation to this threat to safety.
NOW TAKE NOTICE that pursuant to Section 69(2) of the Development Act 1993 the Company is required to:
1.   Forthwith excavate and thereafter not occupy nor use for any activity (except for inspecting the Excavation and conducting works to make the Excavation safe in accordance with the following requirements) that area of land which lies within 5 m of the face of the Excavation.
2.   On or before Tuesday 1 October 2013, carry out the following works:
a. In accordance with a report procured by the Company and reasonably satisfactory to me (or some other person nominated by the Council who is an authorised officer who holds prescribed qualifications under Section 69(1a)) setting out such works in detail, fill-in the Excavation so as return the slope of the Land in the area of the Excavation to a stable slope; OR
b. In accordance with a report procured by the Company and reasonably satisfactory to me (or some other person nominated by the Council who is an authorised officer who holds prescribed qualifications under Section 69(1a)) setting out such works in detail, (i) cover the existing face of the Excavation with an engineered reinforced wall; and (11) divert and manage storm water drainage at the top of the Excavation.
In its report of 5 March 2012, TMK, consulting engineers, opined as follows:
1The action of the adjoining owner in cutting the embankment on the defendant’s land and/or permitting the land to remain in that state has caused or contributed to the land slippage on the plaintiffs’ land.
2The embankment does not comply with minimum back slope requirements of the South Australian Development Regulations 2008 – 2.12.2010, Part 12, Division 3 “Building work affecting other land” and the South Australian Housing Code, Section 2, Figure 2.1 “Excavation and filling affecting adjoining property”.
3The excavation on the defendant’s land is unstable.
4It is expected that further landslips will occur on the plaintiffs’ property as the soil and the rock face continue to erode over time. The trees and other plantings on the plaintiffs’ boundary has stabilised the soil through the binding effect of root systems. The type of potential future damage to the plaintiffs’ land is likely to be similar in nature to previous damage and if left entirely unattended, continued soil slippage and erosion will undermine the support of adjacent trees and may result in their collapse.
TMK Engineers then suggested options to render the slope immediately safe and then recommended a retaining wall and drain system be built upon the defendant’s land.
Coffey Geotechnics produced a report of 15 May 2013.
Subparagraph 8.3 of that report reads as follows:
8.3 Loss of Property
Based on a preliminary assessment of the excavated slope and the review of photographs of land subsidence since construction, it is considered the process of erosion and weathering will continue to result in land subsidence of the excavated batter. To date land subsidence has occurred from approximately 10 m³ extents, but typically less than 3m³ in extent. Based on the regularity of these events it is estimated that similar small scale instabilities at the crest of the batter will occur over time.
To support the above assessment, the site has been classified with consideration of AGS 2007 qualitative risk assessment of likelihood and consequence, where by the:
·Likelihood of a landslide occurring is assigned to be almost certain (A). that is within the next 10 to 20 years an event is expected to occur that will result in;
·The Consequence to property of minor to medium extent (3 to 4). That is a significant part of the site requiring large stabilization works and minor consequence damage; and
·Thereby resulting in a high to very high landslide risk level for the project site.
Refer to Appendix E for the definition of likelihood and consequence as per AGS 2007 qualitative risk assessment. The assigned risk level implication is that treatment is required.
It is noted that a major extent of damage has already occurred at the site, as land subsidence led to the batter which started within 18 Hannaford Road Blackwood has progressed into the SA Water Easement and has recently extended/inclined into 9 Tester Drive. The potential for this to occur along the full length of 9 Tester Drive is highly probable within a 10 to 20 year design life based on the land subsidence to date at the project site.
While the timing and volume of an individual future land subsidence is unable to quantitatively predicted, land subsidence has occurred since construction over – steep excavated batter geometry and therefore support the assessment that engineering support is required to stabilise the batter and mitigate future land subsidence events.
On 17 September 2013 the plaintiffs brought an application for an interlocutory injunction in the following terms:-
INTERLOCUTORY APPLICATION
To the Defendant Logos Research Institute Pty Ltd ACN 118 178 395
The Plaintiffs Brian Arthur Blackburn and Lynette Anne Blackburn apply for the following orders or directions:-
1.   That the defendant its servants or agents do at its cost erect a drained permanent retaining wall designed by a consulting engineer upon or near the boundary of Certificates of Title Volume 5337 Folio 88 and Volume 5679 Folio 131 known as 9 Tester Drive Blackwood and 18 Hannaford Road Blackwood respectively within three (3) months from the date hereof.
2.   That the defendant its servants or agents do at its cost all such things and take all steps necessary in the opinion of such engineer to prevent any further slippage of land upon the said property until further order.
3.   That the costs of and incidental to the within application be the plaintiffs’ costs in any event.
At the time, the plaintiffs had filed a Statement of Claim (FDN2) which alleged in paragraphs 18-24 as follows:-
18.   The soil slippage from the plaintiffs’ land, the loss of soil support beneath the SA Water sewer pipe and the erosion of the rock face underlying the top soil are all indicative that the batter face is unstable.
19.   The level of strength of the rock mass, the shear strength and orientation of defects in the rock are further indicative that the batter face is unstable.
20.   By reason of the instability of the batter face, it is likely that the process of erosion and weathering will continue to result in land subsidence of the excavated batter face. Based on past landslips, there is a strong probability or likelihood of a landslide occurring and that will result in a land slide of minor to medium extent with the result that some of the plaintiffs’ land will be damaged, and the plaintiffs’ use and enjoyment of the land will be adversely affected.
21.   The extent of future land subsidence within the excavated batter slope can be minimised if not prevented by covering the existing batter with an engineered reinforced wall, by diverting and managing storm water drainage at the top of the slope and by limiting access by persons to the edge of the slope.
22.   The construction of an engineered re-inforced wall necessarily involves (inter alia) the removal of the existing boundary fence, and the draped light mesh and the vegetation over the batter slope, the spraying of the batter slope with bitumen emulsion to temporarily seal it, and the installation of a drained, permanent, reinforced concrete retaining wall designed by a consulting engineer.
23.   The matters complained of in this Statement of Claim constitute a nuisance which has been caused or permitted by the defendants, its servants or agent, and which substantially affects the plaintiffs’ use and enjoyment of their land.
24.   Further or in the alternative the matters referred to above constitute a non-natural use of the adjoining land and the defendant has caused or permitted the unauthorised and/or unlawful removal of the natural support of the plaintiffs’ land to remain and has failed to replace that support, causing injury or the risk of injury to the plaintiffs’ land.
In paragraph 25, the plaintiffs seek the following Orders:-
25. (a) An order by way of injunction that the defendant, its servants or agents at its cost erect a drained, permanent, reinforced concrete retaining wall designed by a consulting engineer within three months from the date of the order, and take such other steps or measures as may in the opinion of the said engineer be necessary to protect the plaintiffs’ right to support in respect of the said land/or prevent any further damage to it.
(b) costs.
Because of the obvious complexities involved in this application, it was thought appropriate to refer this matter for early trial. The parties agreed and a number of early trial dates were set.
For reasons that do not require ventilation here, the first and second trial dates that were set (December 2013 and April 2014) could not be utilised. The first date was lost because of a change of representation and the second because a matter with an earlier priority continued through the April hearing dates. This action was then set for trial to commence in May 2014 but again other priority matters dictated that the action could not be reached in the trial list. The action was finally set for hearing on 22 September 2014.
On 16 May 2014, the plaintiffs filed their second Statement of Claim. The further pleadings were that the nuisance that was alleged against the first defendant had diminished the value of the plaintiffs’ land. The plaintiffs also sought an extension of time in the following terms:-
24A Further and in the alternative, and to the extent necessary, the plaintiffs seek an extension of time pursuant to s48 of the Limitations of Actions Act SA 1975 (as amended) extending the time within which the proceedings may be brought upon the ground that facts material to the plaintiffs’ case were not ascertained by the plaintiffs until after the expiration of that period and the action was instituted within 12 months after the ascertainment of those facts.
This pleading of the plaintiffs arose out of the content of the first defendant’s second Defence and Counterclaim. In that pleading, the first defendant denied the plaintiffs’ claim and positively pleaded the following matters:-
16. As to the remedies sought by the plaintiffs in paragraph 25 of the Statement of Claim, the defendant says:
a. Denies that it has committed any nuisance or any other actionable wrong such as to give rise to any remedy sought by the plaintiffs.
b. That the plaintiffs were aware from on or about 9 September 1992, and on or about 11 October 1992, and thereafter that there were land slips and knowingly did not take any steps against the former owners of the adjoining land to address any alleged nuisance at that time, in the circumstances the Plaintiffs have acquiesced and have not sought to minimise any loss or damage as plead. In these circumstances the remedy of injunction is defeated as the plaintiffs are guilty of laches.
c. Alternatively, the injunction would not be granted as the entire claim by the plaintiffs as articulated in the Statement of Claim is barred pursuant to section 35 of the Limitation of Actions Act 1936 or as otherwise provided for in the statute.
d. Says that the landslip on the 7 September 2010 was the result of the plaintiffs construction of the ponds along or adjacent to the common boundary or at other locations in close proximity to the common boundary and/or escarpment or batter wall which caused the topsoil to become water-logged with storm water and which precipitated the landslip causing parts of the privacy wall to be uprooted and to subsequently fall onto the tennis court.
The first defendant also filed a Cross Action in which it pleaded as follows:-
CROSS ACTION (COUNTERCLAIM)
Part 1:
The facts and basis of the counterclaim are:
1.   At all relevant times the defendant was the registered proprietor of the whole of the land comprised in Certificate of Title Register Book volume 5679 Folio 131 (“the adjoining land”) which is known as 18 Hannaford Road Blackwood South Australia.
2.   The defendant became the registered proprietor of the adjoining land on or about the 26 February 2006 (“date of purchase/purchase”).
3.   At all relevant times the defendant was the registered proprietor of the whole of the land comprised in Certificate of Title Register Book Volume 5339 Folio 885 (“The plaintiffs’ land”) which is known as 9 Tester Drive Blackwood South Australia.
4.   The adjoining land adjoins the plaintiffs’ land at the rear of the plaintiffs’ land.
5.   The adjoining land is subject to a 4-metre easement at the rear of the adjoining land and adjacent to the common boundary between the adjoining land and the plaintiffs’ land.
6.   There is a half-sized tennis court which is adjacent to, and which encroaches (to a small extent) into the easement. The predecessor in title excavated the area to create the half-sized tennis court and a garden adjacent to the half-sized tennis court and in doing so created an escarpment or batter wall/batter face/batter slope in the year 1990.
7.   As at the date of purchase there was situated on the adjoining land and covering the escarpment/batter wall chicken wire covered by lush green foliage which created a substantial privacy wall with aesthetic value and which stabilised the topsoil beneath it and on the escarpment/batter wall so as to prevent any movement or landslide in the topsoil (“privacy wall”).
8.   At the time of purchase of the adjoining land the substantial privacy wall ran along the length of the common boundary and was approximately 30-35 metres in length and 3-5 metres in height and approximately .5 metres deep.
9.   On or about the 7 September 2010 there was a landslip on the adjoining land as a result of the plaintiffs constructing by way of excavation water catchment areas, and/or water retention areas, and/or paths, and/or ponds (collectively referred to herein as “ponds”) along or adjacent to the common boundary or at other locations in close proximity to the escarpment or batter wall which caused the topsoil to become water-logged with storm water and precipitated the landslip and caused the substantial privacy wall to collapse and to be damaged.
10.   In addition to paragraph 9, without authority or approval from the defendant either or both of the plaintiffs, or the plaintiffs’ agents or servants, unlawfully entered the adjoining property and caused the substantial privacy wall to be cut, or dug out, or otherwise removed in part, subsequent to and continuing from the 7 September 2010 to the present day. Such actions constituted damage to the adjoining land.
11.   The ongoing creation and use of ponds by each or both of the plaintiffs has constituted an ongoing nuisance which has affected and will continue to affect the adjoining land and has prevented and will continue to prevent the regrowth of the substantial privacy wall.
12.   As a result of the nuisance and the removal of the substantial privacy wall, in large part, the defendant has suffered and will continue to suffer loss and damage insofar as:
a.   The loss of privacy and amenity.
b.   Loss of the use of the adjoining land.
c.   A diminution of the value of the adjoining wall.
d.   The cost of and incidental to the replacement and regrowth of the substantial privacy wall.
The first defendant sought Orders as follows:-
The orders sough are:
1.   Damages being the cost to replace and cause the regrowth of the substantial privacy wall as assessed by the Court.
2.   An injunction preventing each plaintiff from entering the adjoining land.
3.   An injunction preventing each plaintiff from creating or excavating ponds as described in paragraph 9 of this counterclaim and in such terms as the Court considers appropriate.
4.   Interest.
5.   Costs as taxed.

I refer to paragraph 16 of the first defendant’s Defence of 26 January 2014. In Sedleigh-Denfield v O’Callaghan and Ors,[20] the House of Lords considered a nuisance action and the liability for a continuing nuisance. On the respondent’s (to the appeal) land there was a ditch which was later converted by the placement of pipe for carrying off of rainwater. The respondents did not lay the pipe. The pipe was not laid with the consent or knowledge of the respondents. It was laid by a trespasser. The respondents became aware subsequently through their servants of its existence and it was used for the draining of the fields of the respondents.
[20] [1940] AC 880.
The field was in a wooded area. The trees in that wooded area were deciduous. To prevent leaves and other matter blocking the opening of the pipe, a grating was placed near the pipe. Instead of placing the grating some distance from the opening of the pipe so that it could collect the leaves and other material that would otherwise fall into the drain, the grating was placed over the top of the pipe itself. It was possible therefore for the pipe to receive leaves and other detritus into the pipe. A heavy rainstorm occurred. The pipe became choked with leaves. The water overflowed onto the land on which the appellant’s premises stood. There was severe damage to the appellant’s premises. The appellant sought damages for nuisance.
In the speech of Viscount Maugham, his Lordship referred with approval to the statement of law in Salmond’s Law of Torts:[21]
When a nuisance has been created by the act of a trespasser or otherwise without the act, authority or permission of the occupier, the occupier is not responsible for that nuisance unless, with knowledge or means of knowledge of its existence, he suffers it to continue without taking reasonably prompt and efficient means for its abatement.
[21] 5^th ed. 1920 at pp258-265.
His Lordship then discussed a number of authorities, the accuracy of which his Lordship doubted and then stated the law as follows at page 894:-
The statement that an occupier of land is liable for the continuance of a nuisance created by others e.g. by trespassers (or, for example predecessors in title) if he continues or adopts it – which seems to be agreed – throws little light on the matter unless the words continues or adopts are defined. In my opinion an occupier of land continues a nuisance if with knowledge or presumed knowledge of its existence he fails to take any reasonable means to bring it to an end though with ample time to do so. He adopts it if he makes any use of the erection, building, bank or artificial contrivance which constitutes the nuisance.
At page 895, his Lordship said as follows:-
My Lords, in the present case I am of opinion that the respondents both continued and adopted the nuisance. After the lapse of nearly three years they must be taken to have suffered the nuisance to continue; for they neglected to take the very simple step of placing a grid in the proper place which would have removed the danger to their neighbour’s land. They adopted the nuisance for they continued during all that time to use the artificial contrivance of the conduit for the purpose of getting rid of water from their property without taking a proper means for rendering it safe.
At page 896-897, Lord Atkin said as follows:-
“…for the purpose of ascertaining whether as here the plaintiff can establish a private nuisance I think that nuisance is sufficiently defined as a wrongful interference with another’s enjoyment of his land or premises by use of land or premises either occupied or in some cases owned by one self. The occupier or owner is not an insurer; there must be something more than mere harm done to the neighbour’s property to make the party responsible. Deliberate act or negligence is not an essential ingredient but some degree of personal responsibility is required, which is connoted in my definition by the word “use”. This conception is implicit in all the decisions which impose liability only where the defendant has caused or continued the nuisance. We may eliminate in this case caused. What is the meaning of continued? In the context of which it is used continued must indicate mere passive continuance. If a man uses on premises something which he found there and which itself causes a nuisance by… he is himself in continuing to bring into existence (that conduct) causing a nuisance. Continuing in this sense and causing are the same thing. It seems to me clear that if a man permits an offensive thing on his premises to continue to offend, that is, if he knows that it is operating offensively, is able to prevent it, and omits to prevent it, he is permitting the nuisance to continue; in other words he is continuing it. The liability of an occupier has been carried so far that it appears to have been decided that if he comes to occupy it, say as tenant, premises upon which a cause of nuisance exists, caused by a previous occupier, he is responsible even though he does not know that either the cause or the result is in existence.”
Also at page 904-905, Lord Wright rejected the proposition that liability in nuisance is a strict liability. In his speech, his Lordship said as follows at page 904:-
An occupier is not prima facie responsible for a nuisance created without his knowledge and consent. If he is to be liable a further condition is necessary, namely he had knowledge or means of knowledge, that he knew or should have known of the nuisance in time to correct it and obviate its mischievous effects. The liability for a nuisance is not, at least in modern law, a strict or absolute liability. If the defendant by himself or those for whom he is responsible has created what constitutes a nuisance and if it causes damage, the difficulty now being considered does not arise. But he may have taken over the nuisance, ready made as it were, when he acquired the property or the nuisance may be due to a latent defect… then he is not liable unless he continued or adopted the nuisance, or, more accurately, did not without undue delay remedy it when he became aware of it, or with ordinary and reasonable care should have become aware of it. This rule seems to be in accordance with good sense and convenience. The responsibility which attaches to the occupier because he has possession and control of the property cannot logically be limited to the mere creation of the nuisance. It should extend to his conduct if, with knowledge, he leaves the nuisance on his land. The same is true if the nuisance was such that with ordinary care in the management of his property, he should have realised the risk of its existence.”
Lord Wright’s comments in Sedleigh-Denfield were cited with approval by the High Court in Elston v Dore.[22] The High Court decided that fault of some description is necessary in order to support an action in nuisance. The same approach, by analogy, may be derived from the decision of the High Court in Burnie Port Authority v General Jones Pty Ltd.[23] It was in the Burnie Port Authority decision that the High Court held that the tort based on the rule in Rylands v Fletcher[24] should be abolished in Australia. The result is that the occupier of land must be proved to have been at fault when that occupier has introduced, retained or done something on their land which is dangerous and which is likely to cause damage if it escapes. No longer will there be strict liability for the consequences of the escape of a dangerous thing. In this matter it is not necessary to discuss that development further except to say that in England, in Transco PLC v Stockport Metropolitan Borough Council[25] the House of Lords unanimously rejected abolishing the rule in Rylands and Fletcher. It follows from that development that the position in Australia may not be completely clear on the question of strict liability for nuisance causing material damage to a neighbour’s land. Finally in Bankstown City Council v Alamdo Holdings Pty Ltd.[26] the High Court referred to the authorities referred to in the decision of the English Court of Appeal in Marcic v Thames Water Utilities Limited[27] and said those authorities indicated that: “a body such as a council is not, without negligence on its part, liable for a nuisance attributable to the exercise of, or failure to exercise, its statutory powers.”
[22] (1982) 149 CLR 480.
[23] (1994) 179 CLR 520.
[24] (1866) LR 1 Ex 265.
[25] [2003] 3 WLR 1467.
[26] (2005) 223 CLR 660 at [16].
[27] [2004] 2 AC 42.
Harrington (Earl of) v Derby Corporation[28] concerned pollution occasioned to a river by the Derby Corporation emptying sewage directly into the Derwent River which passed the property of the plaintiff and caused interference with the enjoyment of the plaintiff’s land. The action was commenced against the Derby Corporation and in its defence the corporation contended that under s1 of the Public Authorities Protection Act (UK), there is a limitation period in respect of recovery of damages for no longer than six months before the issue of the writ. Buckley J said at page 226-227 as follows:-
“It cannot be disputed that for one cause of action all damages incident to it must be recovered once and once only; so that for instance, if by the removal of the soil the defendant causes the walls of the plaintiff’s house to crack, the plaintiff’s cause of action is one and one only and that nonetheless because the house does not at once show all the damage done to it, but manifests subsequently by degrees that the damage has been done… but if the result of the act is that one damage is done today and another subsequently, there is nothing to prevent a fresh action upon fresh damage being inflicted… if as a result of an act done today damage results a year later, the cause of action arises not at the date of the act but a year later when the damage results. No cause of action arises from the act if it, at that date, created no damage. The right of action arises not from the act, but from the resulting damage from the act… there is, however, a further case with which this section is particularly concerned, namely a continuing act which produces subsequently from day to day a recurrent damage. There is thus created within the principle which I have stated a fresh cause of action everyday… a new damage recurring day by day in respect of an act done, it may be, once and for all at some time prior or repeated, it may be, from day to day.”
[28] [1905] 1 Ch 200.
Although the decision in the Earl of Harrington case on the question of time concerned the interpretation of the Public Authorities Protection Act 1893 of the United Kingdom, Buckley J was careful to distinguish between a once and for all claim for damage and the situation where damage is being inflicted day to day. It is well accepted that if the nuisance causes an interference which is continuing then a plaintiff may commence an action at any time during the continuance of the nuisance and recover for all damage up to that time. An example which is often given is to do with trees on boundaries of property causing ongoing damage to a neighbour’s drain or other structure.
The plaintiffs’ case here is one of a continuing nuisance. Their case is that the creation of the batter slope following the cut is demonstrably the inflictor of damage day to day because of the continuing deleterious effect of that act.
Having regard to these settled principles, it is appropriate that I also set out here a brief discussion of the tort of nuisance and negligence. Helpfully, some relevant principles have been summarised by Blue J in his Honour’s decision in SJ Weir v Bijok and Anor.[29] wherein his Honour said as follows:-
General legal principles
[69] The following general principles have been established in relation to the right of support by adjoining land and the tort of nuisance in respect of the removal of such support.
1.“An owner of land has a right to the support of that land in its natural state from the adjacent and subjacent land of neighbouring owners.” (citations omitted)
2.“This right is a natural incident of the ownership” of the land itself. (citations omitted)
3.An interference by an adjoining land owner with the right of support only occurs, and the tort of nuisance is only committed, at the point at which the owner’s land subsides, as opposed to the point at which the adjoining land owner excavates or take away the support. (citations omitted)
4.“There is no natural right of support for structures (as distinct from the natural right of support for land in its natural state).” (citations omitted)
[29] [2011] SASCFC 165 at [69].
In the balance of the paragraphs in the judgment of Blue J in SJ Weir, his Honour’s focus was upon the issue of loss of support of structures. That issue is not apposite this case.
There are broader issues that require consideration in this case and those other relevant principles are summarised hereunder. This summary of principles is derived from the decision of the Privy Council in Goldman v Hargrave[30] and in the High Court decision of Hargrave v Goldman.[31]
[30] [1966] 115 CLR 458 at 461 et seq.
[31] [1963] 110 CLR 40 at 49 et seq.
The principles are as follows:-
1.Before 1940, a landowner was not subject to any liability in nuisance as a result, for example, of any rocks falling from his land due to weathering or other forces;[32] an occupier was not under a duty to prevent a noxious weed such as prickly pear, from attacking a neighbour’s fence.[33]
[32] Pontardawe Rural District Council v Moore-Gwyn [1929] 1Ch 656 at 660.
[33] Sparke v Osborne (1908) 7 CLR 51; Giles v Walker (1890) 24 QBD 656.
2.After 1940, the modern law of nuisance has been further developed. The authority usually referred to in this context is the decision of the House of Lords in Sedleigh-Denfield v O’Callaghan.[34] At pages 894-895 Viscount Maugham said as follows:
[34] [1940] AC 880.
“In my opinion, an occupier of land continues a nuisance if with knowledge or presumed knowledge of its existence he fails to take any reasonable means to bring it to an end though with ample time to do so. He adopts it if he makes any use of the erection, building, bank or artificial contrivance which constitutes the nuisance. In these sentences I am not attempting exclusive definitions.”
3.In Sedleigh-Denfield v O’Callaghan, the House of Lords approved the dissenting opinion of Scrutton LJ in Job Edwards Limited v Birmingham Navigations[35] where his Lordships said (at 8):
[35] [1924] 1 KB 341.
“There is a great deal to be said for the view that if a man finds a dangerous and artificial thing on his land, which he and those for whom he is responsible did not put there; if he knows that if left alone it will damage other persons; if by reasonable care he can render it harmless, as if by stamping on a fire just beginning from a trespasser’s match he can extinguish it, that then if he does nothing, he has “permitted it to continue”, and become responsible for it. This would base the liability on negligence on not on the duty of insuring damage from a dangerous thing… I appreciate that to get negligence you must have a duty to be careful, but I think on principle that a landowner has a duty to take reasonable care not to allow his land to remain a receptacle for a thing which may, if not rendered harmless, cause damage to his neighbours.”
4.The House of Lords’ decision in Sedleigh-Denfield v O’Callaghan was applied by the High Court in Hargrave v Goldman[36] at page 51:-
[36] (1963) 110 CLR 40 at 51-52 per Taylor and Owen JJ.
“We can see no distinction relevant to the question of liability between potential nuisances created by trespassers and potential nuisances coming into existence: “otherwise without the act, authority or permission of the occupier”… the same notion is apparent in the final proposition as stated by Rowlatt J in Noble v Harrison[37] when he said:
[37] [1926] 2 KB 332.
“The result… is that a person is liable for a nuisance constituted by the state of his property:
(a)   If he causes it;
(b)   If by the neglect of some duty he allowed it to arise; and
(c)    If, when it has arisen without his own act or default, he omits to remedy it within a reasonable time after he did or ought to have become aware of it.”
5.The propositions enunciated by Rowlatt J in Noble were earlier referred to with evident approval by Dixon J as he then was in Torett House Pty Ltd v Berkman.[38] It is apparent that Dixon J had identified and approved of the development in the common law to impose responsibility upon a land owner for the consequence to an adjoining land owner of a nuisance upon that land of which the owner knew or ought to have known. The earlier decision of Rowlatt J in Noble and the dissenting opinion of Scrutton LJ in Job Edwards formed part of the basis of formulation by Viscount Maugham of the common law position in his Lordship’s speech in Sedleigh-Denfield.
[38] (1940) 62 CLR 637 at 657.
6.In Torett at page 657, Dixon J emphasised that the duty to take reasonable care to abate a nuisance arises once the occupier has knowledge or presumed knowledge of its existence. This is consistent with what fell from Viscount Maugham, Lord Wright and Lord Romer in Sedleigh‑Denfield.
7.The decision of the High Court in Hargrave v Goldman, approved by the Privy Council in Goldman v Hargrave[39] concerned a breach of duty giving rise to a finding of nuisance and negligence. Both torts emanate from the requirement of the finding of a duty and the breach of that duty.
[39] (1966) 115 CLR at 458.
8.In Goldman v Hargrave, the Privy Council decided, consistent with the House of Lords’ decision in Sedleigh-Denfield, that the scope of the duty required the obligor to take reasonable steps to abate a nuisance and that there a number of factors such as effort and expense that are required to be considered. In Goldman at page 467, the Privy Council said as follows:
“So far it has been possible to consider the existence of a duty in general terms. But the matter cannot be left there without some definition of the scope of his duty. How far does it go? What is the standard of effort required? What is the position as regards expenditure? It is not enough to say merely that these must be reasonable since what is reasonable to one man may be very unreasonable and indeed ruinous to another: the law must take account of the fact that the occupier from whom the duty is cast, has, ex hypothesi, had this thrust upon him through no seeking or fault of his own. His interest, and his resources, whether physical or material, may be of a very modest character either in relation to the magnitude of the hazard or as compared with those of his threatened neighbour… one may say in general terms that the existence of a duty must be based upon knowledge of the hazard, ability to foresee the consequences of not checking or removing it and the ability to abate it.”
9.In Goldman, the Privy Council focussed upon the relative simplicity, for example, of the case where one neighbour merely douses flames in order to prevent the spread of a fire to a neighbouring property when compared to situations and circumstances which are far more complex and where particular emphasis must be given to aspects such as effort and expense. At page 457, the Privy Council said as follows:-
“Where the hazard could have been removed with little effort and no expenditure, no problem arises. But other cases may not be so simple. In such situations the standard ought to be required of the occupiers what it is reasonable to expect of him in his individual circumstances. Thus, less must be expected of the infirmed than of the able body: the owner of a small property where a hazard arises which threatens a neighbour with substantial interest should not have to do so much as one with larger interest of his own at stake and greater resources to protect them: if the small owner does what he can and promptly calls on his neighbour to provide additional resources, he may be held to have done his duty: he should not be liable unless it is clearly proved that he could, and reasonably in his individual circumstances, should, have done more.”
10.In Leakey v National Trust for Places of Historic Interest or Natural Beauty,[40] Megaw LJ said:-
“The defendant’s duty is to do that which is reasonable for him to do. The criteria of reasonableness include, in respect of a duty of this nature, the factor of what the particular man – not the average man – can be expected to do, having regard amongst other things, where a serious expenditure of money is required to eliminate or reduce the danger, to his means.
…where the expenditure of money is required, the defendant’s capacity to find the money is irrelevant. But this can only be in the way of a broad and not detailed assessment; and, in arriving at a judgment on reasonableness, a similar broad assessment may be relevant in some cases as to the neighbour’s capacity to protect himself from damage, whether by way of some form of barrier on his own land or by way of providing funds for expenditure on agreed works on the land of the defendant.”
11.The judgment of Megaw LJ in Leakey has been accepted and applied in Australia.[41]
[40] [1980] QB 495.
[41] Yared v Glenhurst Gardens Pty Ltd (2002) 10 BPR 19, 485 per Austin J at [99] and [105].

In this judgment, I have taken particular care to set out the terms of the offer and whether it may be ascertained that the parties have intended to enter into a binding contract. For the reasons which I have set out above, the answer is in the affirmative: it is apparent that assessed objectively the parties have intended to enter into a contract by the offer and acceptance. That may be ascertained in any number of ways. In this instance, and as part of its offer, the first defendant announced its intention to construct the retaining wall irrespective of the response of the plaintiffs and in order to obviate the possibility of any injunction or the claim for damages. It also announced that it would make the offer in open Court so as to preserve its position on costs if that offer was rejected. The first defendant was thereby indicating to the plaintiffs its clear intention to proceed to do the work required to construct the retaining wall come what may. That is part of the objective background in which the offer is to be considered. Part of that objective background is also the content of the letter of Mr Colbert and, to a lesser extent, the letter of Mr Carter. In my opinion, when it is properly construed, the letter of Mr Carter does not in any sense fix a ceiling on the costs to be incurred by the first defendant in building a retaining wall. Any argument to the contrary is easily answered. The letter of Mr Colbert refers to an engineering specification to be produced by the firm of engineers “RWB”. That specification was to be obtained by the builder and the first defendant is also required to obtain the planning and building approval of the Mitcham Council. Properly construed, all of the obligations are upon the first defendant to retain the builder, to obtain the appropriate engineering specification that satisfies the requirements of the Mitcham Council and to then build the retaining wall.
And it is not as if the Mitcham Council is some stranger to these matters. I have canvassed earlier in this judgment the notices of the Mitcham Council that were issued to the defendant in relation to the landslip caused by the excavation and the need for remedial work to be done to restore the position. I am satisfied on the papers that have been tendered by the plaintiffs on this application that the defendant well understood the requirements of the Mitcham Council. Similar comments can be made in relation to SA Water. It was the first defendant who joined SA Water as a defendant in the proceedings and SA Water was not, in any sense, a stranger to these proceedings.
Adopting the approach of Allsop J (as his Honour then was) in Branir v Awston Nominees (No 2)[58] “… the essential question in such cases is whether the parties’ conduct including what was said and not said and including the evident commercial aims and expectations of the parties, reveals an understanding or agreement … which bespeaks an intention to be legally bound to the essential elements of a contract.” In my opinion, adopting the approach of Allsop J, the acceptance of the letter of offer of the defendant of 11 September 2014 bespeaks an intention of all parties to be legally bound to the essential elements of a contract.
[58] (2001) 117 FCR 424 at 525.
The finding of a binding agreement: the third Counterclaim
The finding of a binding agreement is open to me notwithstanding the content of the third Counterclaim. In the Counterclaim against the plaintiffs the first defendant alleges conduct of the plaintiffs causing nuisance to the first defendant. That conduct relates to alleged construction of water catchment areas and or water retention areas and/or paths and/or ponds along or near the common boundary (the ponds). The first defendant alleges that these cause topsoil to become waterlogged precipitating landslips and causing a privacy wall to collapse. The privacy wall allegedly existing has been removed.
In the prayer for relief in the Counterclaim the first defendant seeks an injunction preventing each plaintiff from creating or excavating these ponds on their land. That issue stands separately from the matters which merge into the settlement agreement and may be separately litigated on the first defendant’s Counterclaim.
The second issue is the so called privacy wall. This is described as a covering of chicken wire holding lush foliage over the escarpment/batter wall and which allegedly stabilised the soil beneath it. It is alleged that some or all of this privacy wall was removed by the plaintiffs. It is alleged to be some 3-5 metres in height and this calculation is referable to the height of the batter face as I have earlier described. In the prayer for relief in the Counterclaim, the first defendant seeks damages for the cost of replacement for that wall. Properly understood this is the cost of putting chicken wire on the batter face. It is difficult to give this assertion any further serious consideration because of two matters. The first is that under the settlement agreement the first defendant will build the retaining wall. There are obviously works associated with that task that will affect whatever is on the batter face. This would include chicken wire. The second is that in its counterclaim the first defendant asserts an obligation upon the second defendant to build the retaining wall and seeks an order for specific performance of that obligation. It takes little foresight to appreciate that any chicken wire covering of the batter face will be affected if the first defendant is successful on its claim against the second defendant.
The terms of settlement also contain an obligation on the plaintiffs to build a dividing fence along the whole of the common boundary. It is to be inferred that this fence is sufficient to create whatever level of privacy is required by the first defendant. This inference arises because the term stipulated by the first defendant in the letter of offer of 11 September 2014 set out the specification for the dividing fence to built by the plaintiffs. That obligation falls on the plaintiffs under the settlement agreement.
The position is that the only issue arising on the first defendant’s third Counterclaim still extant is the asserted cause of action emanating from the ponds. That issue does not intersect with the question of the existence of the settlement agreement that resolves the plaintiffs’ claim against the first defendant in nuisance. The Court is in a position where it may make orders for summary relief at least in respect of the existence of that agreement and that such orders do not interfere with the rights of the first defendant still extant on the third Counterclaim. I would not therefore postpone any consideration of the plaintiffs’ application until there has been a determination of the third Counterclaim. I have already made orders for the prosecution of that Counterclaim at a hearing on 18 January 2016. I am also satisfied that in so exercising my discretion, I have preserved the interests of the first defendant arising on the third Counterclaim.
In submissions Mr Mellows for the plaintiffs made reference to the question of subsequent conduct. He referred to the decision of Stanley J in Lucke at [71] et seq. His Honour there was considering subsequent conduct in the context whether the parties had agreed to execute a more formal deed. His Honour held at [72] as follows:
The court should not be deflected from a consideration of the real issue by the stipulation in the contract that its terms would be reduced to a deed. Whilst there are features of a deed that distinguish it from a simple contract, the fact that the parties have agreed to reduce their agreement to writing in a deed as opposed to any other form of written contract does not detract from a consideration of the real issue which arose in this matter, namely, if and when the parties had reached a binding agreement.[59]
[59] See Humphris-Clarke v Lazaridis [2010] NSWSC 318 and on appeal [2010] NSWCA 349.
I respectfully agree with and adopt what fell from Stanley J in Lucke. But those matters are of limited assistance to me in deciding the questions under consideration here. In my opinion, on the papers before me, the parties have entered into a binding agreement. In a sense that finding is slightly conditional because it then becomes necessary to consider whether orders should be made under R232(1) and (2)(a).
The expression of my view that the parties have entered into a binding contract requires me also to consider the content of the first defendant’s fourth Defence, the content of which I have set out in paragraph [11] above.
The first plea (Defence paragraph 18a) is that the first defendant denies the whole of paragraphs 25-28 of the Statement of Claim. At one level that is a peculiar plea. The whole of the relevant admissible evidence before me discloses that there was an exchange of correspondence on 11 and 12 September 2014. It was the first defendant who proposed the offer in its terms, announced that it would build the retaining wall come what may and that it would announce its offer in open Court. The only issue arising on this denial really must be informed by a critical examination of its contents consistent with the principles of uncertainty. I have examined the letter in that context. I am in a position to find that a contract has been formed. That is the answer to that assertion. It is groundless because it is the first defendant who proposed the contract in a form that if accepted bound the plaintiffs and resolved that issue in the litigation.
The second plea (para 18b) alleges that it was either a condition precedent or a condition subsequent of the agreement that the plaintiffs, as it were, justify its claim for legal fees. That term/condition is not to be found in the letter of 11 September 2014. That is a complete answer to that assertion. The offer deals with costs at paragraphs 8 and 9 in the following terms:-
8. That the plaintiffs pay the first defendant costs of and incidental to the proceedings on a party/party basis as agreed or taxed save as to the costs order made in relation to the vacation of the hearing in December 2013 (Vacated Hearing). That the first defendant pays to the plaintiffs the costs of the Vacated Hearing in the amount of $5,000 or as taxed on a party/party basis.
9. This offer can be accepted in writing up to 2.00 pm on 12 September 2014 and after this time the offer will lapse. This offer can be accepted with or without paragraph 8. If paragraph 8 is not accepted then the matter of costs can be listed for argument.
The acceptance letter of 12 September 2014 deals with the issue of costs in the following way:-
“My clients have instructed me to accept the offer set out in paragraphs 1 to 7 of the Open Offer contained in that letter. My clients do not accept the offer set out in paragraph 8 of the Open Offer.
In respect of costs my clients seek from your client a contribution of $72,000 towards their party/party costs or their reasonable party/party costs to be agreed or assessed by the Court. Alternatively the question of costs (other than costs already ordered to be paid) can be determined by the Court once the agreed terms have been put into effect.”
The plaintiffs ask the first defendant to pay their costs but are content for the matter to be adjudicated by the Court. There can be no breach of any essential terms for two main reasons: no such term exists and the parties have agreed upon a method to resolve costs. The plea is both groundless and misconceived.
The third ground of Defence is that in subpara 18c which alleges that the parties contemplated as a condition precedent to the formation of any agreement the recording of the terms of settlement in a deed for execution. It appears implicit that the first defendant contends that there was no agreement until a further document was signed. A review of the offer and acceptance indicates no such term. To the contrary, the offer is put in such a way that if it is rejected then the following would occur:-
1.   The first defendant would approach the Court to have the orders for the conclave of experts vacated;
2.   That the open offer would be put before the Court;
3.   The only outstanding issue is costs and the Court would be asked to give directions and set a time for argument on that matter.
That is not the language of an offer that is conditional upon further consensus on terms to be recorded in a binding agreement. Again to the contrary, the first defendant relies upon its offer as sufficient to satisfy the Court that its offer is a complete answer to the causes of actions pleaded by the plaintiffs. The ground of Defence is both groundless and misconceived.
The fourth ground of Defence is to be found in paragraph 18e. It pleads implied essential terms of an offer that there were obligations on the plaintiffs to carry out works on their land, that the plaintiffs agree for the builder to have access across their land to carry out construction of the wall, that the plaintiffs have breached their obligation and have not done work on their land nor have they allowed access on their land for construction purposes.
The recital of the material above indicates that the plaintiffs have demanded the first defendant obtain the necessary development and building approval from Mitcham Council. The first defendant undertook to do this based on the engineer’s report that it was to obtain. All of these matters were preparatory to construction starting. None have been done and there is no “construction”. The question of access across the plaintiffs’ land and the carrying out of works on the plaintiffs’ land are not referred to in the letter of offer. The pleading appears to be wholly misconceived because the contract formed on its basis of acceptance of the offer contains no such terms.
The fourth alternative plea is in para 18e of the Defence. It pleads that the agreement was in principle only and more matters needed to be agreed. They were:
(i)The natural flow of water off the plaintiffs’ land; and
(ii)The collection of water on the plaintiffs’ land; and
(iii)Reasonable access over the plaintiffs’ land (presumably for construction purposes – that had never commenced).
None of these matters are contained in the terms of the offer. In the quote of the wall builders, Mr Colbert recommends that the engineer draws up a water course diversion (from above). This is the same engineer who is to be provided by the customer (the first defendant). There is no stipulation in the offer that the plaintiffs are to pay for water course diversion, whatever that may mean. The offer was to construct the wall in accordance with the quote of 2 July 2014. That was the offer that was accepted. There is no suggestion that it was in principle even though authority (GR Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd per McHugh J) suggests that in principle agreements are enforceable. I need not consider that matter further because the parties have settled upon the terms of their contract. There is no basis to treat it as an in principle agreement only. This is both misguided and misconceived.
Paragraph 18f of the Defence alleges for the same reasons that the absence of such terms renders the agreement incomplete. That fails for the same reason.
The sixth alternative plea (paragraph 18g) alleges that the first defendant may rely upon an otherwise unstated mistaken belief of the plaintiffs to argue that the contract formed is void for mistake. Such a defence is totally misconceived.
In summary, I am satisfied that none of these defences raise any matter that would lead me to the conclusion that they disclose any reasonable basis for defending this aspect of the defendant’s claim.
The final issue for my determination is whether I would exercise my discretion in favour of the plaintiffs, having been satisfied that there is a reasonable basis for the plaintiffs’ claim and that there is no reasonable prospect of successfully defending the claim of the plaintiffs’ of a settlement based upon the argument reached between them on 11 and 12 September 2014.
Specific performance
When considering the question of specific performance as sought by the plaintiffs, it is necessary to gather the principles applicable to the grant of such a remedy. They are as follows:-
1.   Specific performance ordinarily is considered an equitable remedy and is therefore generally thought to be discretionary. A party such as the plaintiffs do not have any right to an order for specific performance.
2.   In recent times the traditional view has been reconsidered and in Zhu v Treasurer of New South Wales (2004) 218 CLR 530 at 129, the High Court[60] said as follows:-
[60] Gleeson CJ, Cummow, Kirby, Callinan and Haydon JJ.
“Subject to the established limits on the grant of specific performance and injunctions, in Australian law each contracting party may be said to have a right to the performance of the contract by the other. It is not true here to say: “the duty to keep a contract at common law means a prediction that you must pay damages if you do not keep it, and nothing else.”
See also Tabcorp Holdings Limited v Bowen Investments Limited (2009) 236 CLR 272 at [13].
3.   Traditionally it is been held that there are five requirements for the award of specific performance. They are as follows:-
a.    Damages are not an adequate remedy;
b.   The Court is in a position to find that there is an enforceable agreement;
c.   There has been a breach of that agreement;
d.   The agreement must be possible to perform; and
e.   The claimant for an award of specific performance is able to satisfy the discretionary factor.
It is necessary to consider each of those matters in turn:-
(a)   The inadequacy of damages
Ordinarily, where a party successfully claims for a breach of contract, the successful party is awarded damages. Therefore, it may be seen that a grant of specific performance is an exception to the common law rules. The question becomes whether damages are an inadequate remedy. In Coulls v Bagot’s Executor and Trustee Co Limited (1967) 119 CLR 460 at 503, Windeyer J said as follows:-
“There is no reason today for limiting by particular categories, rather than by general principle, the cases in which orders for specific performance will be made.”[61]
[61] See also Zhu v Treasurer of New South Wales (2004) 218 CLR 530 at 128.
Following the decision of the High Court in Zhu, the approach of Windeyer J may be identified as ameliorating the strictness of the “categories” approach. It would appear that the question of expansion of categories really is another way of expressing the view that particular matters may be decided according to their peculiar facts.
The categories that are usually identified are contracts involving land, options to purchase land, building contracts where work is sufficiently defined, covenants to repair in leases, contracts for sale of personal property, contracts involving shares, contracts involving personal services and contracts involving money. Contracts involving land are ordinarily identified as matters in respect of which there may be an order for specific performance because land is generally identified as being unique.
Specific performance will not usually be granted in respect of an option to purchase land nor to complete the building of a home. The other categories do not require consideration here.
(b) The second requirement is that the agreement be enforceable in equity.
In the case at bar, I am dealing with the question of whether there is an enforceable contract. The other considerations which are usually considered namely the doctrine of part performance, estoppel and constructive trusts do not need to be considered. The agreement is enforceable in equity.
(c) The third requirement is that for there to be an identifiable breach.
As the question in this matter is whether the contract exists and, if so has it been breached, it is unnecessary to consider matters such as anticipatory breach of contract. The first defendant has not complied with its obligations under the contract. There is a breach.
(d) The fourth requirement is that performance must be possible.
There is no indication in the evidence before me that the performance has been rendered impossible because, for example, the Hannaford Road land has been compulsorily acquired, or for any other reason.
(e) Discretionary factors
Discretionary factors are usually grouped under the headings of mutuality, readiness and ability to perform, futility of ordering specific performance, the question of whether the plaintiff comes to equity with “clean hands”, hardship, contracts for personal services and the question of supervision. I will consider only those matters that are relevant here.
The concept of mutuality ordinarily requires that the contract must be specifically performed by both parties. If one party is unable to perform for reasons such as disability, then a Court could not order the specific performance of the contract because both parties could not perform. This is not an issue in this matter.
Readiness, willingness and ability to perform appears only to relate to the position of the plaintiffs.[62] That is not in doubt here.
[62] Mehmet v Benson (1965) 113 CLR 295 at 308 per Barwick CJ and at 314 per Windeyer J; Foran v Wight (1989) 168 CLR 385 at 451-452.
It is unnecessary for me to consider futility or the question of the plaintiffs’ conduct. There is no question on the evidence before me of the plaintiffs being unable to withstand an inspection of their conduct in equity.[63]
[63] Legione v Hateley (1983) 152 CLR 406 at 449.
The discretionary factor of hardship revolves around the question of hardship to a defendant. One consideration might be where the defendant has made some form of unilateral mistake which has caused that defendant to enter into a contract which the defendant would not otherwise have entered.[64] The authorities appear to indicate that the question of hardship is not to be considered from the point of view of the expenditure required by the defendant. That said, there is authority that the Court may examine the terms of the contract in coming to a decision about hardship.[65] It is a little difficult to rationalise these authorities in the context of parties’ freedom to contract which appears to be the modern doctrine. There is insufficient material before the Court on this topic to enable me to make a finding.
[64] Maralinga Pty Ltd v Major Enterprises Pty Ltd (1973) 128 CLR 336.
[65] Dowsett v Reid (1912) 15 CLR 695; Summer v Cocks (1927) 40 CLR 321; Sydney Consumers Milk and Ice Co Limited v Hawesbury Dairy and Ice Society Limited (1931) 48 WN 127 at 130.
There is no aspect of contracts of personal service involved in this matter.
The discretionary factor of constant supervision involves questions of whether or not the Court is required to constantly supervise the party against whom an order for specific performance has been made.[66]
In Patrick Stevedores, the High Court held that: “questions of degree rather than absolute restrictions upon the scope of curial relief are involved”.[67] The Court further held: “reference to constant Court applications should not be misunderstood. The Courts are well accustomed to the exercise of supervisory jurisdiction upon applications by trustees, receivers, provisional liquidators and others with the responsibility for the conduct of administration.”[68]
The discussion contained within the decision of the High Court[69] in Zhu[70] is apposite here. In Zhu the High Court was careful to refer to the established limits on the grant of specific performance and injunctions. Having established those limitations, the focus of the Court appears to have been upon performance of a contract rather than assessment of damages. The same sentiments are expressed in the High Court’s decisions in Tabcorp Holdings Limited v Bowen Investments Pty Ltd[71] where the High Court said as follows:-
[13] Underlying the tenant’s submission that the appropriate measure of damages was the diminution in value of the reversion was an assumption that anyone who enters into a contract is at complete liberty to break it provided damages adequate to compensate the innocent party are paid. It is an assumption which at least one distinguished mind has shared. It has been dignified as “the doctrine of efficient breach”. It led, in the landlord’s submission, to an attempt “arrogantly [to] impose a form of ‘economic rationalism’” on the unwilling landlord. The assumption underlying the tenant’s submission takes no account of the existence of equitable remedies, like decrees of specific performance and injunction, which ensure or encourage the performance of contracts rather than the payment of damages for breach. It is an assumption which underrates the extent to which those remedies are available. However, even if the assumption were correct it would not assist the tenant. The tenant’s submission misunderstands the common law in relation to damages for breach of contract.
The “ruling principle”, confirmed in this court on numerous occasions, with respect to damages at common law for breach of contract is that stated by Parke B in Robinson v Harman.
The rule of the common law is, that where a party sustains a loss by reason of a breach of contract, he is, so far as money can do it, to be placed in the same situation, with respect to damages, as if the contract had been performed.
Oliver J was correct to say in Radford v De Froberville - 17 that the words “the same situation, with respect to damages, as if the contract had been performed” do not mean “as good a financial position as if the contract had been performed” (emphasis added). In some circumstances putting the innocent party into “the same situation … as if the contract had been performed” will coincide with placing the party into the same financial situation. Thus, in the case of the supply of defective goods, the prima facie measure of damages is the difference in value between the contract goods and the goods supplied. But as Staughton LJ explained in Ruxley Electronics and Constructions Ltd v Forsyth such a measure of damages seeks only to reflect the financial consequences of a notional transaction whereby the buyer sells the defective goods on the market and purchases the contract goods. The buyer is thus placed in the “same situation … as if the contract had been performed”, with the loss being the difference in market value. However, in cases where the contract is not for the sale of marketable commodities, selling the defective item and purchasing an item corresponding with the contract is not possible. In such cases, diminution in value damages will not restore the innocent party to the “same situation … as if the contract had been performed”.
(citations omitted)
Clarke v Macourt[72] concerned the proper approach to the assessment of damages. The plurality, Keane, Hayne, Crennen and Bell JJ applied Robinson v Harman[73] and Tabcorp Limited v Bowen Investments Pty Ltd[74] and held that the ruling principle in the assessment of damages for breach of contract is that the damages should put the promisee in the same situation with respect to damages so far as money can do it as it would have been in had the broken promise being performed. The Court held that this principle does not operate differently as between contracts for sale of goods and contracts for sale of assets of a business. The damages are assessed at the date of the breach of the contract. The High Court said that it is an error to assess the value of the asset by reference only to the value of what the party in default had promised to deliver but did not deliver as at the date of breach. That is to be assessed as the market price of the goods at the contractual time for delivery less the contract price. The obvious emphasis here is the focus upon what the contract required the party to do and not merely to focus upon assessing the value of what was not done.
[66] Insurance Society Limited v Argyll Stores (Holdings) Limited [1998] AC 1; Patrick Stevedores Operations No. 2 Pty Ltd v Maritime Union of Australia (No. 3) (1998) 195 CLR 1.
[67] Ibid at [78].
[68] Ibid at [80].
[69] Gleeson CJ, Gummow, Kirby, Callinun and Heydon JJ.
[70] (2004) 218 CLR 530 at [128].
[71] (2009) 236 CLR 272 at [13].
[72] (2013) 304 ALR 220.
[73] (1848) 1 Ex 850.
[74] (2009) 236 CLR 272.

I have formed the view that a settlement agreement exists and it has been breached. On the discretionary factors, I am satisfied that the principles of mutuality can be satisfied, that the plaintiffs are ready, willing and able to perform their obligations under the contract, that there is no aspect of futility, there is no postponing conduct on the part of the plaintiffs and that there is no aspect of contract for personal service.
In Patrick Stevedores, when discussing the question of supervision the Court was referring to the need for other Courts to deal in a supervisory way with the applications brought by trustees, receivers, provisional liquidators and others with responsibility for the conduct of administrations. That may be seen to be a different circumstance than, for example, the supervision by a Court for the fulfilment by one party of the terms of its contract. Even though the High Court said in Zhu that each contracting party has a right to the performance of the contract by the other, that right was subject to the established limits on the grants of specific performance and injunctions under Australian law. Some comfort may be taken from the decision of the High Court in Clarke where the Court focussed its attention, in a situation of a breach of contract for sale of goods, upon the market price of the goods at the contractual time for delivery. The focus of the Court was upon the right of the purchasing party to be given performance of the contract at the relevant time for performance. The question of supervision as a discretionary function was not addressed by the plaintiffs and I am not in a position to make any finding about it. I am not prepared to proceed to determine this difficult issue without the benefit of detailed submissions from Counsel. This is so for many reasons including that the breadth of the decision of the High Court in Zhu does not appear to have been further considered.
One main issue for my consideration, and this consideration in my view, significantly informs the question of the exercise of the discretion under R232(1) and R233 is the question of the adequacy of common law damages. On this question, there seems to be some differences in judicial approach. In Beswick v Beswick,[75] Lord Upjohn said that: “equity will grant specific performance when damages are inadequate to meet the justice of the case”. It appears that Lord Upjohn was deliberately including the reference to “meet(ing) the justice of the case” as a consideration to be taken into account as to whether or not a grant of specific performance would be made by a Court. The test as formulated by Lord Upjohn was cited with approval by Mason CJ and Wilson J in Trident General Insurance Co Limited v McNiece Bros. Pty Ltd.[76] All of the relevant authorities on this topic were reviewed by Beazley JA in Waterways Authority of New South Wales v Cole and Allied (Operations) Pty Ltd[77] and her Honour concluded[78] that this test as formulated by Lord Upjohn has not attracted much support in Australia. My researches indicate that the “reformulated” test was applied by Young CJ in Eq in Mayo Group International Pty Ltd v Hudson Respiratory Care Inc.[79] His Honour did not express any view about whether the reformulated test was the law of Australia notwithstanding that his Honour applied the test in coming to his decision in that matter.
[75] [1968] AC 58 at 102.
[76] (1988) 165 CLR 107 at 119.
[77] [2007] NSWCA 276.
[78] At [95].
[79] [2005] NSWSC 445.
On the question of the sufficiency of damages it is also necessary to consider the obverse situation which involves a consideration of the principles applicable to abatement (by the plaintiffs here). Abatement may be understood as the self help remedy where the party suffering a wrongful interference can lawfully take steps to nullify the nuisance. Part of that entitlement includes the right to enter a neighbour’s land to remove, for example, a blockage. As a matter of commonsense, the correct approach for a person who is taking steps to abate a nuisance varies according to the type of nuisance. In some instances, where the cause of the nuisance may be abated by taking steps to remove a blockage in a pipe, then no notice needs to be given to the neighbour. The situation is different where significant works are going to be undertaken. In those circumstances, it is necessary to give notice to the wrongdoer of the damage and to give the wrongdoer the opportunity of avoiding further damage by undertaking the necessary work to abate the nuisance.
The relevant principles are gathered by John Murphy in the text “The Law of Nuisance”.[80] The learned author says as follows:-
“6.31 although the law recognises a right to abate a nuisance… it also places important limits on the steps that can be taken by the victim in this respect. Thus, for example, it is well established that abatement might be effected peacefully. Lord Denman put it in these terms “the individual aggrieved may abate… so long as he causes no riot.”[81] Equally, in abating the nuisance, the victim must act promptly[82] and he must also keep to a minimum any damage he thereby causes (subject to the qualification that he may not select a method of abatement that infringes the rights of third parties even if this method would cause harm overall than an alternative method which merely affects the wrongdoer).[83] Finally, the Court of Appeal has also held that abatement is only available in a case in which a Court has not already refused or would not (if the matters were to be litigated) refuse a mandatory injunction.[84] The rationale for this rule was expressed in these terms: “self redress is a summary remedy which is justified only in clear and simple cases, or in an emergency. Where a plaintiff has applied for a mandatory injunction and failed, the sole justification for a summary remedy (namely emergency) has gone.”[85]
[80] 2010 Oxford University Press at paragraph 6.31.
[81] Mayor of Colchester v Brooke (1845) 7 QB 339 at 377.
[82] Moffett v Brewer (1848) Iowa 1 Greene 348.
[83] Roberts v Rose (1865) LR 1 ex 82.
[84] Burton v Winters (1993) 1 WLR 1077.
[85] Ibid at 1082 per Lloyd LJ.
The retaining wall would need to be built adjacent to the easement belonging to the Minister. The border of the plaintiffs’ land and the first defendant’s land sits on the eastern edge of the easement. Under the usual terms, the dominant party of the easement is the Minister and the subservient party is the first defendant. In order to construct the retaining wall, it would be necessary for the plaintiffs to come onto the land of the first defendant and to direct major work to be done from both the plaintiffs’ side and the defendant’s side as well as to involve the Minister. In those circumstances abatement need not be considered further but it may be a relevant issue on the question of the adequacy of damages.
At paragraphs 23 and following of the plaintiffs’ written submissions, the plaintiffs address the question of specific performance. The plaintiffs referred to the decision of White J in McLaren v Schuit.[86] This case concerned a compromise of proceeding effected by an offer and acceptance. The question was whether the compromise had the effect of extinguishing the old cause of action and giving rise to a new one so that there is no jurisdiction in a Court in which the proceedings were brought to grant relief about the breach of the new agreement. The contention was that it would be necessary to commence new proceedings to enforce the settlement agreement. White J found that no new proceedings were required to be commenced.
[86] (1983) 33 SASR 139 per White J.
In his judgment, White J considered relevant authorities and refused to follow the Court of Appeal decision of McCallum v Country Residences Limited[87] and the decision of Slade LJ in Greene v Rozen.[88] His Honour held at page 154-155 as follows:-
“If the letter of offer had been an open offer from the outset, it would undoubtedly had been admissible in evidence as an admission under the rules.. the letter of offer combined with the letter of acceptance constituted a contract and the letter of offer ceased to be without prejudice. The letter of offer did not disappear into thin air, as it were, or become subsumed into a contract which causes it to lose its identity. It continued in existence as a document, quite independently of the contract, and it remained capable of amounting to an admission of fact and of the truth of the plaintiff’s case. The plaintiff was and is entitled to judgment on the basis thereof.”
[87] [1965] 2 All ER 364.
[88] [1955] 2 All ER 797.
White J held that the plaintiff was entitled to judgment in the same action on the basis of the compromise that had been reached between the parties.
It appears that an earlier decision to the same effect of the Full Court of the Supreme Court of Victoria in Roberts v Gippsland Agricultural and Earthmoving Contracting Co. Pty Ltd.[89] was not brought to the attention of White J in McLaren. In that case, the Full Court refused to follow the decision of Slade J in Green v Rozen which the Court of Appeal felt bound to apply in McCallum’s case. The conclusion reached by the Full Court in Roberts was the same as the conclusion reached by White J in McLaren. The pertinent parts of the judgment of the Full Court are at page 557 as follows:-
“…We have no doubt that in certain simple cases an agreement for the compromise of an action may be enforced on a motion for judgment in the action itself in accordance with the agreed terms. If the action itself is still on foot, not having been stayed or discontinued or struck out or its normal progress otherwise interrupted; and if the claim in the action is for payment of a sum of money for one of the common counts, such as work and labour done, and the compromises upon terms that the defendant pay to the plaintiff an agreed amount at an agreed date in full settlement of the plaintiff’s claim in the action, and with an agreement by the defendant that in default of payment the plaintiff may enter judgment for that amount and that the defendant will consent to such judgment, we entertain no doubt that this Court has jurisdiction on motion in the action to direct that judgment be entered for the agreed sum if the defendant makes default in payment – even if at that stage the defendant is, contrary to her agreement, no longer a consenting party.”
[89] [1956] VLR 555.
Lowe and O’Bryan JJ considered the matter further at page 558 as follows:-
“We would only add that in view of the simple form which this compromise ultimately took, we have found it unnecessary to consider what limits there may be upon the jurisdiction or discretion of the Court to entertain on motion in the action an application to enforce a compromise where the circumstances are different from those in this case. We had the assistance of Counsel for the respondent at the hearing of the appeal, but the appellant appeared in person and in the absence of a full argument we have not thought it desirable to express views beyond what are necessary for the determination of the matter before us.”
In the same decision, Smith J assessed the position both before and after the Judicature Act amendments. On the question of specific performance, his Honour said:-[90]
“Pre Judicature Act amendments
(c) For the purposes of deciding which of the two general categories a case fell within, the Court did not look merely at the particular obligations sought to be enforced. It looked also at the obligations of the applicant so far as justice required that the application should not be granted without ensuring that they too would be performed… but it would disregard altogether obligations already fully performed… it may be observed that in order to ensure the performance of obligations by the applicant the Court could also make an order conditional on such performance…
(d) If there was a substantial question to be determined as to what were the terms of the agreement, or as to whether it was valid or specifically enforceable, as for example where a substantial case was put forward of material mistake or of other circumstances such as would afford a defence to a suit for specific performance, a party would ordinarily be left to proceed by separate bill so that the matters raised might be fully investigated.
(citations omitted)
[90] At page 563 (c) and (d).
The position following the Judicature Act amendments[91] was summarised by Smith J at page 564 as follows:-
“… The resulting position would appear to be as follows:-
(i)The Court will now enforce the agreement of compromise upon motion in the action whenever the circumstances are such that it would have been enforced in a corresponding manner in the old Court of Chancery.
(ii)In addition the agreement may be so enforced notwithstanding the fact that it involves matter extraneous to the action and notwithstanding that there is a substantial question raised as to the terms or validity or enforceability of the agreement, provided that the Court is clearly satisfied that justice can be done under the summary procedures. At least this is so where all that the Court needs to order for the purpose of enforcing performance upon just terms is a stay of proceedings or dismissal of the action or some relief claimed in the action.”
In deciding whether justice can be done under the summary procedure the Court of course needs to consider a variety of matters involving questions of degree. These, I think, must include the extent to which extraneous matters are involved, how substantial are the questions to be determined, to what extent questions of credibility are likely to arise…”
[91] Reflected in the terms of s8 District Court Act and s27 of the Supreme Court Act which reads as follows:-
Section 27 The Court in every cause or matter pending before it shall have power to grant and shall grant either absolutely or on such reasonable terms and conditions as it deems just, all such remedies whatsoever as any of the parties thereto may appear to be entitled to in respect of every legal or equitable claim properly brought forward by them respectively, in such causal matter, so that, as far as possible, all matters so in controversy between the parties may be completely and finally determined and all multiplicity of legal proceedings concerning any of such matters avoided.
At page 565, Smith J addressed the question of the availability of an order for specific performance on a summary procedure:-
“Two further points may be mentioned.. secondly, though the fact that the agreement expressly stipulates that it shall be made a rule of Court, or that it shall be enforced by order in the action, is still, I think, an important consideration in determining whether the summary procedure should be adopted, the Court is not bound to give effect to such an agreement. It has a discretion as to whether it will do so, which appears to be wide enough to enable it to give effect to any matter of such a nature as would afford a defence in an action for specific performance: see Neale v Lennox;[92] Lewis v Lewis;[93] Shepherd v Robinson[94]”
[92] [1902] AC 465.
[93] (1890) 45 Ch D 281.
[94] [1919] 1 KB 474.
The matters which fell from Smith J in Roberts are reflected in the content of R232(1) and also reflect the legal position about whether a Court would grant an order for specific performance. Those considerations are informed by equitable rules.
In this matter, the plaintiffs did not specifically address the question of specific performance apart from the matters contained within paragraph 23 of the plaintiffs’ written submissions. I have already dealt with the reference to the decision of White J in McLaren. That case does not afford any assistance on the question of specific performance. The decision in Roberts is limited to the question as defined by Lowe and O’Bryan JJ. The judgment of Smith J makes clear that the Court has a discretion whether it would give effect to any matter that would afford a defence in an application for specific performance according to well settled equitable rules.
The plaintiffs have not addressed those principles in this application. The Court has been left in a position where that question has not yet been the subject of properly considered submissions. The Court is not in a position where it is able to reach any conclusion on, for example, whether common law damages are inadequate and whether there are particular submissions to be made in relation to the discretionary factors.
In those circumstances, it is necessary to hear from the parties further on that topic. It is appropriate therefore, that I hear further submissions and that I reserve my decision on that question pending the receipt of those further submissions. That position does not detract from the other findings made by me on the question of existence of the agreement reached between the parties reflected in the letters of 11 and 12 September 2014.
I therefore return to the five questions that I postulated at the beginning of this judgment. I will repeat those questions and provide my answers. They are as follows:-
1.   Whether the plaintiffs and the first defendant made an enforceable contract on 12 September 2014.
Answer: Yes.
2.   If yes to question 1 what are the terms of that contract.
Answer: The terms of the contract are the contents of the letter first of the first defendant’s solicitor to the plaintiffs’ solicitor dated 11 September 2014 as informed by the retaining wall builder quotation signed by Mr Bruce Colbert dated 2 July 2014, the obligations for the fulfilment of which fall upon the first defendant under the terms of the offer made by the first defendant and the letter of acceptance from the plaintiffs’ solicitor to the first defendant’s solicitor dated 12 September 2014.
3.   If yes to question 1 and on the assumption that question 2 is answered in the affirmative, whether there is no reasonable basis for the first defendant to defend the claim of the plaintiffs’ under R232 and R233.
Answer: There is no reasonable basis for the first defendant to defend the claim of the plaintiffs that a contract was formed between them on 12 September 2014.
4.   If yes to question 3, whether the plaintiffs have satisfied the five requirements for an order for specific performance namely:-
4.1 Common law damages are inadequate;
4.2 There is an enforceable agreement;
4.3 There is a breach of the enforceable agreement;
4.4 That it is possible for the agreement to be performed;
4.5 Whether any of the discretionary factors militate against the grant of an order for specific performance.
Answer: 4.1 Unable to answer
4.2Not answered (but already answered in question 1)
4.3Not answered (but already answered in questions 1, 2 and 3)
4.4Not answered (but already answered in questions 1, 2 and 3)
4.5Unable to answer.
5.   If yes to paragraph 4 whether the Court would exercise its discretion under R232(1) (and R233) of 6DCR (2006).
Answer: Unable to answer; it is first necessary to resolve the issues arising under question four.
6.   The claims made upon the face of the first defendant’s Counterclaim do not operate to require the Court to postpone the exercise of its discretion on the application of the plaintiffs.
I will hear the parties about consequential orders and costs.