Brown v Etna Developments Pty Ltd [2025] NSWSC 358
Hearing dates:
10 – 14 March 2025
Date of orders:
30 April 2025
Decision date:
30 April 2025
Jurisdiction:
Equity - Technology and Construction List
Before:
Rees J
Decision:
Judgment against the defendants.
Catchwords:
TORTS — homeowner’s worst nightmare — development site next to plaintiffs’ home — developer excavates 9 metres to construct 55 apartments – geotechnical engineer identifies high risk of landslide at boundary — geotechnical advice ignored — excavations go beyond boundary — landslide — plaintiffs’ driveway collapses into development site — plaintiffs’ unable to access home by vehicle — plaintiffs’ property rendered worthless – developer and builder go in external administration – whether family members who ran the building company are personally liable.
CORPORATIONS — directors and officers — whether de facto or shadow director — whether directors personally liable for directing or procuring the tortious conduct for the company — extent of duty owed by disabled director — principles at [236]-[243].
TRESPASS — whether each defendant excavated beyond the boundary – boundary not clearly marked.
NEGLIGENCE — duty of care to maintain support for land, s 177 of the Conveyancing Act 1919 (NSW).
DAMAGES — whether rectification costs disproportionate to diminution of land value — whether reasonable to award rectification costs in the circumstances – principles at [265]-[270] — general damages.
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
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Brown v Etna Developments Pty Ltd [2025] NSWSC 358
Case
[2025] NSWSC 358
Decision Date
CaseChat Overview and Summary
In Brown v Etna Developments Pty Ltd, the plaintiffs sought compensation for significant damages caused by the defendants' excavation activities on a development site adjacent to their home. The defendants, Etna Developments and its associated individuals, were responsible for constructing a multi-level apartment building. During excavation, the defendants extended their work beyond the property boundary, causing a landslide that resulted in the collapse of the plaintiffs' driveway and rendering their property inaccessible by vehicle. Consequently, the plaintiffs' property was rendered essentially worthless. Both the developer and the builder subsequently entered external administration, prompting the plaintiffs to seek personal liability from the family members who managed the building company.
The primary legal issues in this case revolved around the defendants' liability for trespass and negligence. The court had to determine whether the excavation work extended beyond the property boundary, given that the boundary was not clearly marked. Additionally, the court examined whether the defendants owed a duty of care under section 177 of the Conveyancing Act 1919 (NSW) to maintain the support for the plaintiffs' land, and whether this duty was breached. The court also considered the applicability of the Civil Liability Act, specifically addressing the issue of proportionate liability and whether the trespass claim was apportionable.
The court found that the defendants had indeed trespassed by excavating beyond the property boundary. The excavation work extended into the plaintiffs' land, leading to the collapse of their driveway and the subsequent loss of property access. Regarding negligence, the court held that the defendants failed to adhere to the required duty of care, as established under the Conveyancing Act. The court further concluded that the family members who ran the building company could be held personally liable for directing or procuring the tortious conduct of the company. The disabled director's extent of duty was also scrutinized, with the court applying the principles set out in the judgment. Finally, the court considered the damages, finding that the rectification costs were not disproportionate to the diminution in land value and awarded general damages to the plaintiffs.
The court ordered the defendants to compensate the plaintiffs for the trespass, negligence, and resultant damages. The family members who managed the building company were held personally liable, and the award included rectification costs, general damages, and any other relevant expenses. The decision underscored the importance of adhering to legal obligations concerning property boundaries and the duty of care in construction activities.