SSYBA Pty Ltd v Lane
[2013] WASC 445
•13 DECEMBER 2013
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: SSYBA PTY LTD -v- LANE
CORAM: McKECHNIE J
HEARD: 25 & 26 NOVEMBER 2013
DELIVERED : 13 DECEMBER 2013
FILE NO/S: CIV 1647 of 2011
BETWEEN: SSYBA PTY LTD
First plaintiff
MICHAEL JOSEPH GRIFFIN
Second plaintiffAND
MICHAEL REUBEN LANE
First DefendantLAMAC COMMERCIAL PLUMBING PTY LTD (IN LIQ)
Second Defendant
Catchwords:
Trespass to land - Nuisance - Liability of a director of a company - Liability of owner of land for permitting a continuing trespass - Whether vicariously liable for acts of workers who affix brackets to plaintiffs' wall - Principles of liability - Damages - Whether exemplary damages should be awarded - Comparison with other awards
Legislation:
Dividing Fences Act 1961 (WA)
Result:
Plaintiff succeeds, permanent injunction granted, damages awarded
Counterclaim dismissed
Category: B
Representation:
Counsel:
First plaintiff : Ms C H Thompson
Second plaintiff : Ms C H Thompson
First Defendant : In person
Second Defendant : No appearance
Solicitors:
First plaintiff : Benz Legal
Second plaintiff : Benz Legal
First Defendant : In person
Second Defendant : No appearance
Case(s) referred to in judgment(s):
Attorney‑General v Corke [1932] 1 Ch 89
Balanced Securities Ltd v Bianco [2010] VSC 201; (2010) 27 VR 599
Barker v The Queen (1983) 153 CLR 338
Deutsch v Rodkin [2012] VSC 450
Field Common Ltd v Elmsbridge Borough Council [2008] EWHC 2079 (Ch); (2008) All ER (D) 141
Finesky Holdings Pty Ltd v Minister for Transport (WA) [2002] WASCA 206; (2002) 26 WAR 368
Gray v Motor Accident Commission [1998] HCA 70; (1998) 196 CLR 1
Hill v Higgins [2012] NSWSC 270
Holmes v Wilson (1839) 10 Ad & El 503
Hungerfords v Walker [1989] HCA 8; (1989) 171 CLR 125
Lippiatt v South Gloucestershire County Council [2000] QB 51
Microsoft Corporation v Auschina Polaris Pty Ltd (1996) 142 ALR 111
Plenty v Dillon [1991] HCA 5; (1991) 171 CLR 635
Quarmby v Oakley and Harper [2011] TASSC 20
Rylands v Fletcher [1868] LR3HL 330
Sedleigh‑Denfield v O'Callaghan [1940] AC 880; [1940] 3 All ER 349
Sefton v Tophams Ltd [1967] 1 AC 60
State of New South Wales v Ibbett [2006] HCA 57; (2006) 229 CLR 638
TCN Channel Nine Pty Ltd v Anning [2002] NSWCA 82; (2002) 54 NSWLR 333
TCN Channel Nine Pty Ltd v Ilvariy Pty Ltd [2008] NSWCA 9; (2008) 71 NSWLR 323
Thompson‑Schwab v Costaki [1956] 1 WLR 335
Westripp v Baldock [1938] 2 All ER 779
Whitehaven Coal Mining Ltd v Tomaska [2012] NSWSC 1445
Windridge Farm Pty Ltd v Grassi [2011] NSWSC 196; (2011) 254 FLR 87
McKECHNIE J:
Introduction
It is a great pity that Mr Lane did not remove the brackets which had been placed onto his neighbour's wall when he was politely asked to do so on 23 November 2008. Had he acted then, he would have saved Mr Griffin a lot of stress and inconvenience and he would have saved himself an award of damages against him in the tens of thousands of dollars. But he did not and so after five years, what should have been resolved that day has been the subject of a costly Supreme Court trial.
The parties
Palmer Crescent in Davenport, a commercial suburb of Bunbury, had two businesses side by side. One, Lamac Commercial Plumbing Pty Ltd (whom I shall refer to as LCP) was a plumbing business. Mr Lane, the sole director and shareholder, owned the land, lot 51 Palmer Crescent. He had subdivided and sold off lot 50 Palmer Crescent in April 2005 to Mr Griffin. Originally, LCP was a defendant to the action. Liquidators were appointed to LCP on 7 February 2013 and the company is in liquidation. Consequently, the action against the company as second defendant has been stayed.
In May 2006, Mr Griffin engaged Southern City Building Group to build a set of units to be operated as Abyss Self Storage by SSYBA Pty Ltd, a company controlled by Mr Griffin. For convenience I shall refer to the company by its palindrome, Abyss.
Before he commenced building, Mr Griffin spoke to Mr Lane. The chain link fence on the boundary between the properties was taken down and moved several metres into Mr Lane's land to allow the builders access. The building, which was divided into storage units, was constructed with concrete tilt panel perimeter walls on a steel frame with a Colourbond roof. Internal walls separating the units were formed with Colourbond sheets attached to the concrete tilt outer frame by masonry bolts. Concrete tilt walls are a relatively quick means of forming a wall. They are non‑combustible, cast on site and then craned into position. Panels are approximately 4 m high, 6.2 m long and 125 mm deep.
Building work went smoothly and was completed in early 2007. Abyss commenced trading in mid‑2007. The chain mesh fence was not replaced on the boundary line.
Units are leased to storers on a monthly basis. The units are not powered and so access is during daylight hours. Goods are stored at the storer's sole risk. Abyss does not have a key to a rented unit and can only inspect by giving 21 days written notice.
How the dispute arose
On 16 November 2008, Mr Griffin observed several brackets attached to the eastern wall of the building, facing Mr Lane's land. Coils of flexible pipes were hanging off three brackets.
The next day Mr Griffin delivered a letter addressed to Mr Lane at LCP and gave it to a woman who appeared to be working there. She acknowledged receipt. The letter was addressed to Mr Lane and read:
I have noticed that several pipe hanging brackets have been attached to the wall on my property without my authorisation or knowledge. Would you please immediately remove the brackets and make repairs to the wall panels as required.
Please inform me if the holes have protruded through the wall as this will have a negative affect my customers and my business.
Additionally, would you please refrain from leaning items against the tilt panels of my property as they were not designed for external loads and may be detrimental to the structure, especially in the case of fire.
Michael, as a good neighbour it is disappointing that this has occurred without my knowledge or consent.
Mr Griffin received no reply to this letter. A week later he attended LCP and asked for Mr Lane who was not there. Mr Griffin was given his mobile phone number. He went outside to his car and rang Mr Lane. Mr Lane acknowledged receipt of the letter. Mr Griffin asked Mr Lane to remove the brackets. Mr Lane said no. Mr Griffin explained the reason for removal and asked again and Mr Lane said 'I'll look into it. I'll see where I stand'.
On 19 November 2008, Mr Griffin took a series of photographs of the brackets and hoses (exhibit 9). They clearly show a trespass to Mr Griffin's land. Three substantial brackets are affixed to the building wall and on each bracket hang coils of flexible hose.
Following Mr Lane's refusal and with no action forthcoming, Mr Griffin approached the City of Bunbury. On 9 December 2008 Mr Bruhn, the City's Building Coordinator, wrote to LCP. Relevantly, he wrote:
The City does not wish to become involved with any possible neighbourhood dispute however it should be noted there are a number of issues that require to be resolved please see a list below.
•Precast concrete buildings are specifically engineered and by placing any additional loads onto a structure may adversely affect the buildings stability.
•It is not possible without agreement legal or otherwise to use another person's building for affixing [a] structure to.
•Damage to another person's property can occur with the use of bolts etc fixed into a wall and may cause that wall to not perform to its design criteria.
Simple racking similar [to] that which supports a few hoses on your property does not require a building licence and the location of such racking appears suitable. It would be possible to install free standing racking wholly within your property situated within the same location.
Please be advised the existing racks affixed to the adjoining wall should be removed forthwith and any hole patched (exhibit 11).
Like Mr Griffin, Mr Bruhn received no response from Mr Lane.
Mr Griffin retained solicitors who wrote to Mr Lane on 13 February 2009 (exhibit 12). The letter noted that consent to attach the brackets was not obtained, drilling into the wall is likely to have damaged the structural integrity and that the walls and supporting steel structure were not designed for any load other than that of the original building. The letter warned:
Your actions to date constitute a trespass to our client's property which has further resulted in causing damage to that property.
Again, there was no response to the letter.
Mr Griffin took more photographs on 27 February 2009 (exhibit 13). These show that nothing had changed. The brackets were still in position and coiled hoses were hanging on the brackets.
A year passed. On 1 May 2010, Mr Griffin took photographs of some heavy concrete lid covers leaning directly against the wall and the brackets still had hoses coiled on them (exhibit 15). Adjacent to the wall, though not leaning directly on it, was a stand containing lengths of piping. The position of this stand showed it was possible to fully utilise the LCP yard without leaning items directly onto the wall.
On 8 September 2010, Mr Griffin observed that the original three brackets had now been joined by more brackets. At least one of the new brackets was coming away from the wall. On 12 September 2010, Mr Griffin took photographs (exhibit 16).
After unsuccessfully attempting to involve the police, Mr Griffin again went to the City of Bunbury. Mr Bruhn wrote to LCP, Attention Steve, on 13 September 2010 (exhibit 18).
Mr Bruhn advised that the matter was referred to one of Bunbury's better known structural engineers who stated that:
[tiltup] concrete buildings are not designed to take additional loads especially with an outwards moment and any load may have adverse effects on the stability of the building.
The letter concluded:
[The] City can not permit a potentially dangerous situation to continue could you please be advised the existing racks affixed to the adjoining wall should be removed forthwith and any hole patched.
No response was received to this letter.
On 22 September 2010, Mr Griffin took further photographs (exhibit 20). By this time the number of brackets had grown from six to ten. Coils of hoses were fastened from each.
Around this time Mr Griffin first observed a crack in the east wall in one of the vacant units either 23 or 24. On 21 October 2010, Mr Griffin took a series of photographs of cracking within unit 31 (exhibit 21). The cracking is quite extensive.
On 21 November 2010, Mr Griffin took a further series of photographs (exhibit 22). The position of a truck he observed, and visible in the photographs, concerned Mr Griffin because the proximity of vehicles meant that they may hit the brackets and do further damage to the building. Indeed, the middle bracket (book of documents, page 210) appears to be bent upwards.
An engineer is engaged
At this point, Mr Griffin engaged Mr Steven Woodhouse. Mr Woodhouse has been a structural engineer for 30 years and is Director and CEO of WML Consultants Pty Ltd. He has a Bachelor of Engineering degree with Honours, is a chartered engineer, Member of Engineers Australia, and manager of the structural engineering group within WML Consultants. He has extensive experience with tilt panel buildings and commercial constructions. I am satisfied that he is a relevantly qualified expert.
Mr Woodhouse's final structural report of 8 September 2011 (exhibit 31) sets out his observations and explains his conclusions. He noted the affixing and loading of the brackets affixed to the east wall has caused cracks to develop to the internal and external side of the concrete panels to the east wall. The brackets were fixed with M10 bolts into an expanded socket located in a predrilled hole into the concrete panel. It was observed that the brackets to the panels of units 23, 24 and 25 also have plastic plugs suitable for screws. There was evidence that the plugs were pulling out of the wall. Other brackets were fixed with an M10 Dynabolt, which is an expanding anchor type of bolt. There were three different types of bracket. The largest bracket had four bolts affixing it to the wall. There were three locations where these were situated. There are two small brackets affixed at a low level to Units 24 and 25. The mid‑sized bracket was fixed with three bolts to the panels of Units 26, 27, 28, 29, 30, 31 and 32 (7 locations).
The holes were approximately 40 mm deep. The diameter of the holes was approximately 12 mm. The larger bracket weighed approximately 10.8 kg; the mid‑size bracket weighed 8.3 kg; the smallest one weighed 4.2 kg and made of steel angle section 50 mm by 50 mm each leg and 5 mm thick.
The estimated total weight suspended from all the brackets affixed to the east wall was 2.555 tonne. In Mr Woodhouse's opinion the wall would not have been designed to carry any additional load such as would have been applied by the brackets.
In his evidence, Mr Woodhouse explained that the tilt panels are non‑load bearing walls. They are designed to take the forces of wind only; any additional load will change the load pattern and cause stress to the panel.
As to the source of cracking, he said each incidence of cracking is coincident with the location of a bracket and it is clear that the loads on the brackets were overstressing the concrete panel. There is no correlation with wind load.
He explained again the tilt panel - their structure is designed to fail and pull the panel inwards so as not to affect adjoining buildings, neighbours or fire fighters.
In cross‑examination Mr Woodhouse agreed it is very common to have hair line cracks in the centre of panels as they flex when being craned into position. He agreed that in his report (exhibit 31) red lines marked in the photographs at the centre of the panels are passing behind the centre of the stud walls. The fixings of the internal stud walls are expanding Dynabolt types. He acknowledged that the cracks are at least 1 m from the bolt holes and the sketch does not show cracking from the bolt holes at all. There are no cracks coming from the bolt holes:
[T]he cracked patterns on these [panels] is not a lifting crack. If a panel cracks when lifted on here, typically the crack would run horizontally (ts 59).
He could not describe these as lifting cracks:
[T]he distribution of the loads either side of the internal partition and the restraint provided by the internal partition to the concrete panel indicates that the panel will bend around those internal bolts and the bending moment that is created by that can lead to tension cracks, which is what we've seen here. It is the fact that they are restraint - there is restraint by the bolt to that position that allows or causes the panel to be overstressed around that line of support (ts 59).
Mr Woodhouse was taken to a report (not tendered) by another firm of engineers, Suckling Civil & Structural Engineers dated 25 July 2011 where the author, Mr Suckling, wrote:
An inspection of the storage unit side of the wall has noted that the panels are exhibiting cracking between units 26 and 26, 27 and 28, 29 and 30 and units 31 and 32. This cracking is occurring generally centrally in the panel and is emanating from the masonry anchors used for the central wall fixings. This cracking is in no way related to the fixing brackets and occurs at the panel midpoint whereas the brackets were generally at one‑third points.
Mr Woodhouse said he differed from this opinion:
[T]he load of the brackets on the outside face of the panel, it causes the tilt panel to go into a flexural shape which creates what we term as a bending moment. The peak bending moment would occur where the bolts are located on the internal walls. The bending face or the tension face is on the inside and that its tension, when that stress exceeds the tensile capacity of the concrete, creates the crack. It occurs at the wall position because that is the point at which the panel is actually fixed (ts 60).
Mr Woodhouse was asked about the fire rating and (noting p 101 book of documents, part of exhibit 16) indicated that the panel in its attachment to the other panel at the corner is fixed so that it may not fall inwards. He was asked about the steel beams connected to the panel location and he noted that he did not see cracking on the panel but the design engineer has responsibility to be satisfied that the bolt fixings are compliant.
Conclusion on Mr Woodhouse's evidence
I accept the opinions Mr Woodhouse has expressed. There are no contrary opinions. Mr Lane did not call Mr Suckling to give evidence in response. Moreover the storage unit layout plans, attached to Mr Woodhouse's updated report of 6 November 2013, clearly show the only damaged panels are those which have had brackets affixed to them in the past. If the damage was caused by the bolting of the interior wall to the panel it could be expected that other units, perhaps those facing to the south, but also the two units facing to the east, would have damage. Yet they do not. I am satisfied that the brackets have caused significant damage to the structure of the eastern wall.
The brackets are finally removed
Even the issue of a writ did not cause Mr Lane to take any action. It was only the threat of an interlocutory injunction by letter of 19 May 2011 containing a draft of the injunction and affidavit that apparently caused Mr Lane to have the hoses taken down and the brackets cut off by angle grinder, although most of the bolts were left in the wall.
The pleadings
The plaintiffs' claim follows generally the evidence I have set out and which I accept. It was not challenged except to a minor degree and there is no contrary evidence.
In the defence it is admitted that without consent of the second defendant LCP caused or permitted:
(a)bolts and brackets to be affixed to the east wall from which it has hung plumbing pipes and other equipment used in or associated with the business run by the second defendant; and
(b)equipment used in or associated with the business run by the second defendant to be stored by being rested against the east wall.
In the defence originally filed, par 12 of the statement of claim was admitted:
The second defendant's conduct pleaded in paragraph 9 was undertaken with the knowledge, consent and acquiescence of the first defendant.
At trial Mr Lane applied to amend the admission to a partial denial. The amendment was supported by an affidavit asserting that the admission was made against Mr Lane's instructions.
The plaintiffs opposed the amendment. Privilege having been waived, the plaintiffs gave evidence, tendering an incomplete record of Mr Lane's instructions to his solicitors.
Principally, because Mr Lane was unrepresented, I gave leave to amend so that par 7 of the defence now reads:
Save to deny that the bolts and brackets were affixed to the eastern wall with the knowledge, consent and acquiescence of the first defendant the defendant admits paragraph 12 of the statement of claim.
The plaintiffs assert that the admitted conduct in par 9 constitutes trespass and that the conduct in pars 9 and 11 constitute a private nuisance:
The conduct of the second defendant [LCP] pleaded in paragraph 9 above has caused damage to the East Wall.
Paragraph 15 states:
In contumelious disregard of the plaintiffs' rights, the defendants have failed or refused to remove the equipment or make good the damage.
The defendants lodged a defence and counterclaim asserting that the original fence was used in the course of its business for the purpose of leaning supplies against (the east wall) which constituted a dividing fence. The defendants used it in the manner consistent with its use as the original fence and LCP abated a nuisance to the defendants created by Mr Griffin's unauthorised removal of the original fence. It is also asserted that the removal of the fence constituted trespass to LCP's possessory interest.
By counterclaim, the defendants claimed:
In the premises:
a.The removal of the Original Fence constituted a trespass to the Second Defendant's possession and use of it;
b.The removal of the Original Fence created an ongoing nuisance to the Second Defendant in that it was unable to store supplies against the Original Fence as it previously had;
c.The second Plaintiff is liable to the Defendants for the cost of rebuilding the dividing fence and resurveying the boundary between Lot 50 and Lot 51.
Issue was joined by the plaintiffs. It is pleaded that the counterclaim is not justiciable in the Supreme Court being a claim under the Dividing Fences Act 1961 (WA) the sole jurisdiction for which is the Magistrates Court; or alternatively, does not plead any cause of action known to law.
As LCP did not appear, because the action has been stayed, no evidence has been led to support the counterclaim.
The trial
The plaintiffs called two witnesses, Mr Griffin and Mr Woodhouse. Each was cross‑examined briefly by Mr Lane.
Mr Lane represented himself at trial. At the commencement of the trial I explained to Mr Lane the procedure and the difference between cross‑examination and evidence. I advised Mr Lane that following the plaintiffs closing their case:
[Y]ou will be given the opportunity at that point to open your case; that is to tell me what you think I need to know about your case in fact or law, and what you say again is not evidence. If you wish to call evidence, either from yourself or from somebody else, you would then have the opportunity to go into the witness box and give evidence on oath or affirmation (ts 4).
At the conclusion of the plaintiffs' case I called upon Mr Lane in relation to his chamber summons to amend his defence. He said, among other things:
LANE, MR:... I was away in America for the month of September 2011.
McKECHNIE J: Well, that's - if you want me to rely on that you'll have to give evidence of that fact in due course.
LANE, MR:Okay.
McKECHNIE J: It's not a fact I can just take from the Bar table. In due course, that - - -
LANE, MR:Okay. Yep, sure.
McKECHNIE J: - - - depends on how I rule on your application as to whether you decide to give evidence or not (ts 72).
McKECHNIE J: We'll put the chamber summons to one side just for a minute. My question to you was whether you planned to make an opening statement and that's the first question. And the second question is, do you plan to call evidence either from yourself or somebody else or both?
LANE, MR:No, I don't plan to call evidence.
McKECHNIE J: All right. In which case you will not get the opportunity to make an opening statement, but you will get the opportunity to make a closing statement, and probably after the plaintiff in that case (ts 64).
Accordingly, the plaintiffs' counsel Ms Thompson addressed the court. When Mr Lane commenced his address in response he began to make reference to matters not in evidence. I told him I was unable to take into account what he said in relation to facts asserted from the bar table. His closing submissions were then brief.
The essence of Mr Lane's defence seems to be that he had no knowledge of the placing of the brackets on the east wall of the units and therefore was not liable.
The fact that he is the sole director and sole shareholder of LCP is relevant but not decisive to that question. It is relevant that he is also the landowner on which his company carried on business. In order to succeed, the plaintiffs must establish at the least, the knowledge or permission by Mr Lane for the actions of LCP staff.
Trespass
The tort of trespass is easily defined. It is the entry onto the land in the possession of another person without authority, justification or excuse.
In Barker v The Queen (1983) 153 CLR 338 Mason J:
[The] essence of trespass by wrongful entry consists in an entry without right or authority by one person onto the land of another who is in possession, using that word in its strict sense so as to include a person entitled to immediate and exclusive possession Thompson v Ward [1953] 2 QB 153 (341).
Brennan and Deane JJ:
At common law, a person enters land as a trespasser if he enters land in the possession of another without justification (356).
A case with similarities to the present is Westripp v Baldock [1938] 2 All ER 779. The plaintiff and defendant occupied adjoining houses. The defendant carried on trade as a jobbing builder. He placed ladders, planks, sand and such like against the side wall of the plaintiff's house. The judge was satisfied that the leaning of the material against the plaintiff's house was a trespass which had damaged the pointing and indeed that it continued to be committed since the issue of the writ.
The damage done was twofold: an invasion of the legally protected interest of both plaintiffs in their possession of the land and actual physical damage caused by that invasion.
In a case such as the present where there is a building or fixture trespassing onto another person's land, the trespass continues so long as that building or fixture remains on the other person's land. The act of trespass in such a case is a continuing act not a single act.
In Holmes v Wilson (1839) 10 Ad & El 503, bulwarks were erected on the plaintiff's land. Compensation was paid but the bulwarks remained so the plaintiffs brought another action.
Lord Denman:
Trespass is the proper remedy for wrongfully continuing a building on plaintiff's land, for the erection of which plaintiff has already recovered compensation; and a recovery, with satisfaction, for erecting it, does not operate as a purchase of the right to continue such erection (503).
… the former and present action are for different trespasses. The former was for erecting the buttresses. This action is for continuing the buttresses so erected. The continued use of the buttresses for the support of the road, under such circumstances, was a fresh trespass (511).
In Field Common Ltd v Elmsbridge Borough Council [2008] EWHC 2079 (Ch); (2008) All ER (D) 141, council had laid tarmac on the plaintiff's land as part of an upgrade of a road which was used by council tenants. A judge gave judgment on liability and directed an assessment of damages which was carried out by Warren J. Warren J had to decide whether the council was liable for the acts of its tenant:
However, where the trespass takes the shape of fixing materials to the land (such as building a wall on it or constructing a road on it by the laying of tarmac), the materials become, on one view, part of the land and ownership passes to the landowner. On that basis, the continued presence of those materials is not a continuing trespass. That does not mean the landowner has no remedy. If he suffers loss as a result of the presence of the wall or the road in those examples, he can recover the loss even if there is only a single act of trespass. If the landowner wishes the wall or road to be removed, he can ask the trespasser to do so; if the trespasser fails to do so, the landowner can remove it himself and, if it was reasonable for him to do so, he will be able to recover the expense. It might seem, therefore, that it makes little difference in practice whether there is a single act of trespass or a continuing trespass [29].
It is not a particularly strong argument in any case. It seems to me that, if there is a continuing trespass, the trespasser has a perfectly effective way of protecting himself. He can ask the landowner if he wants the trespassing material removed. If the answer is yes, the trespasser has implicit permission to do so and if he then fails to do so it is right that he should continue to be liable for the continuing trespass. If the answer is no, then the landowner has effectively indicated that he does not object to the presence of the materials on the land so that he could not successfully assert that there was a continuing trespass, at least until he changes his position and asks for its removal. Of course, where there is a lengthy period during which the materials remain on the land without objection but in the absence of an intervention by the trespasser enquiring whether those materials should be removed, it may be that nice questions would arise about whether the landowner is estopped in some way from asserting a claim in trespass [32].
Warren J thought that the issue of liability for the council depended on whether the council had caused or permitted its tenants to trespass on the Red Land. He referred to Sefton v Tophams Ltd [1967] 1 AC 60 and then concluded:
My conclusion is, nonetheless, that the Council has made itself liable for the trespasses of its tenants. The Council has, in the words of the order, 'caused or permitted' its tenants to trespass subject to certain qualifications which appear later in this judgment in relation to the tenants of Unit 12 to 14. It has done so by the laying of tarmac on the Red Land which was so great an encouragement to the tenants to gain access to the Industrial Estate by use of the Red Land that the Council can be said to have 'permitted' use of the Red Land. Although the torts are different, nuisance and trespass are two different aspects of the protection of property and indeed it may sometimes be difficult to say in borderline cases which cause of action is appropriate. In nuisance, it is established that a landlord can be liable for a nuisance committed by his tenant in cases where the landlord has authorised the activity constituting the nuisance. At least where the nuisance is certain to result or is a virtual certainty, liability is found to exist. In the present case, I consider that the use of Red Land by the tenants was a virtual certainty. The result which I think is correct in relation to the trespass in the present case at least accords with the approach which would be taken in a case of nuisance. I do not consider that the failure of FCL to insist on the removal of the tarmac can be taken as establishing that the tenants trespassed not because of the Council's permission but because of the presence of the tarmac road with the approval of FCL [46].
There are analogies in the area of private nuisance.
In Sedleigh‑Denfield v O'Callaghan [1940] AC 880; [1940] 3 All ER 349, a trespasser, the local council, laid a drain on the defendants' land. Later, the defendants came to use the drain themselves. A grate was misplaced by them so that in heavy rainstorms it became clogged with leaves and water flowed onto the plaintiff's neighbouring land.
The House of Lords held that an occupier of land is liable for the continuation of a nuisance created by others if he continues or adopts it. Lord Wright:
Though the rule has not been laid down by this House, it has, I think, been rightly established in the Court of Appeal that 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, that 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 … 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 or to the act of a trespasser or stranger. 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 (365).
Viscount Maugham:
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 (358).
In Lippiatt v South Gloucestershire County Council [2000] QB 51, tenant farmers' land adjoined council land which travellers entered as trespassers and started to occupy. The council was aware of their presence and resolved they would tolerate what they regarded as an unauthorised encampment. They provided toilet, water, and other facilities for the travellers. The travellers brought considerable nuisance onto the land of the tenant farmers. Evans LJ (at 56):
The basis for the occupier's liability was explained in Sedleigh‑Denfield v O'Callaghan [1940] AC 880. The test in shorthand is whether the occupier 'adopted' the nuisance, which was created by another person.
(4) In more limited circumstances, where the land from which the nuisance emanates is subject to a tenancy, the landlord may be liable, notwithstanding that he does not have possession and control of the land. It has been held that the landlord can only be held liable when he expressly or implicitly authorised the creation or continuance of the nuisance: Clerk and Lindsell para 18 ‑ 51, and see Smith v Scott [1973] Ch 314.
The principle, as stated by Lord Goff of Chieveley in Hunter v Canary Wharf Ltd [1997] AC 655 with whom Lord Lloyd of Berwick agreed, at p 700, is that as a general rule some form of 'emanation' from the defendant's land is required. On analysis, what 'emanated' in the present case was the travellers themselves. I do not find this form of emanation difficult to accept. If it was somehow excluded from the definition of a nuisance, then any number of examples come to mind where the distinction would be artificial in the extreme. Keeping fierce dogs and allowing them to roam would be a nuisance; taking them onto the neighbour's land and releasing them there would not. Mr Spens submits that the council cannot be held liable in nuisance for the deliberate act of a third party. But that is not generally true, because there clearly can be liability for a nuisance created deliberately by a third party, even a trespasser, on the defendant's land. If there was an exception limited to deliberate acts off the defendant's land, then that merely restates the general submission which, for the reasons given, I would reject (60).
Mummery LJ:
[I]t appears that an occupier of land may be held liable in nuisance in these exceptional circumstances: the plaintiff's use and enjoyment of his rights in his land is interfered with by the continuing presence on the defendant's land of persons whose actual or apprehended activities include, to the knowledge of the defendant, harmful acts repeatedly committed by them on the plaintiffs' land from their base on land occupied by the defendant (62).
In Attorney‑General v Corke [1932] 1 Ch 89, the owner of a disused brickfield allowed a caravan, occupied by what would now be known as travellers, onto the land. The neighbours brought an action in nuisance. Bennett J, although in reliance on Rylands v Fletcher [1868] LR3HL 330, held:
[T]he defendant can be made responsible in law for the nuisance which undoubtedly exists, on the facts, in the vicinity of this camp, and which nuisance is caused by some of the people whom he brings there for his own profit (95).
In Thompson‑Schwab v Costaki [1956] 1 WLR 335, premises were used for prostitution. The perambulation of the prostitutes and their customers was blatant. Romer LJ considered there was ample evidence to lead to the conclusion that using a house for prostitution constitutes an actionable interference with the plaintiffs in the reasonable and ordinary enjoyment of their houses.
The plaintiffs mount their case in both trespass and nuisance, though much of Ms Thompson's submissions were directed to the tort of trespass. Whether the claim is considered as a direct trespass onto the plaintiffs' land, or as a private nuisance by allowing people on Mr Lane's land to interfere with the plaintiffs' land, matters little as the result is the same.
The result is that Mr Lane is liable as landowner who, having notice of the trespass, failed to remedy it in any way and failed to ensure that further damage was prevented.
I said earlier that Mr Lane's position as sole director and shareholder of LCP was relevant.
In Microsoft Corporation v Auschina Polaris Pty Ltd (1996) 142 ALR 111, Lindgren J had to consider the liability of a director of a company which had sold unlicensed reproductions of computer software opened by the applicant. He commenced by setting out certain propositions which seem to be uncontroversial in relation to tortious activity:
(3)The principles governing vicarious liability of an employer for the torts of its employee do not govern the present question: WEA at FCR 283.
(4)The holding of an office in a company, such as that of director or even managing director, does not itself suffice to render the office-holder liable.
(5)It is not necessary that the director know that the conduct in question is tortious.
(6)In any particular case it is necessary to assess closely the director's conduct and its relationship with the tortious conduct for which the company is liable (121).
Lindgren J then proceeded to analyse a number of authorities which it is not necessary to set out before concluding:
With great respect, however, I find the 'directed or procured' test more satisfactory than the 'making the tortious act his own' test. In any event, the former test is supported by Australian authority which I should follow unless convinced that it is clearly wrong. I am not convinced that it is clearly wrong (125).
It may be that a consequence of the view which I favour is that in the case of a 'one man company', in the sense of a company, all of whose relevant acts, omissions and states of mind are exclusively those of one human being, that human being will be liable for the tortious conduct of the company, at least in cases other than 'dealings cases'. I find nothing in principle or authority inconsistent with this result (126).
The present case is not quite in that category. True it is that Mr Lane is the controlling mind of the company, but he was not the only member of the business.
However, whether or not there were other persons with responsibility within the company, Mr Lane was its director and only shareholder. Any profit made was his. He was also its landlord. From the letter written to him and received before 24 November 2008 he knew that brackets had been affixed to the east wall, and that hoses were hanging off them. He also knew that the plaintiffs had not consented to this trespass.
Moreover, even accepting (although there is no evidence) that Mr Lane was busy from time to time with other plumbing projects away from Bunbury and that indeed in September 2011 he was as he says in the United States for a month, it is absolutely inconceivable that he did not ever visit the LCP yard over the three years between receiving the first letter and the eventual removal of the brackets. Having regard to the photographs which have been tendered in evidence, any person visiting the yard would have been bound to have seen the brackets and the hoses hanging from them. Both as landlord and as the controlling mind of the company he had a duty to remove the brackets. He also had a duty to instruct LCP staff not only to remove the brackets but to refrain from any further trespasses. He had a duty as neighbour not to allow or permit his land to be used to facilitate a trespass on the plaintiffs' land in the light of his knowledge. This he manifestly failed to do.
Mr Lane is personally liable for the acts committed by the employees of LCP. By failing to give instructions to remove the brackets immediately he tacitly permitted or allowed his employees to continue to use the wall in circumstances where it was convenient for LCP to do so and likely that more brackets might be placed to take advantage of the free storage they provided.
The counterclaim
There is little to say about the counterclaim. Neither LCP nor Mr Lane have adduced any evidence in support of it. The only evidence about the dividing fence emerged in the cross‑examination of Mr Griffin (ts 47). The evidence was that Mr Lane agreed to remove the dividing fence and install a temporary site fence on his property. On completion of construction of the units the dividing boundary fence was not re‑erected. Mr Griffin did not agree that if the fence had been re‑erected items would have been lent against the fence and not the wall:
Mesh - chain mesh fences are so weak, your Honour, you can push on them pretty easily, it will take next to no force to be able to push it from the distance of - on the boundary and hit the wall with - with very little force (ts 47).
He also pointed out:
[Y]ou certainly couldn't hang pipes or anything at all off these posts or chained mesh fence (ts 47).
The counterclaim alleged that the original fence was removed without the consent of the defendants. Mr Griffin's evidence, which is the only evidence on the point, is to the contrary. The counterclaim alleges damage to the second defendant. That action has been stayed. In any event, the cost of rebuilding the equivalent fence is more appropriately a matter in the Magistrates Court under the Dividing Fences Act.
As there is no evidence to substantiate the counterclaim it fails.
Damages
General damages mesne profits
A trespass to land always involves an award of damages even if the amount is nominal. It vindicates the owner's right to quiet possession. A trespass which causes actual damage entitles the plaintiff to compensation for that damage.
Approaching the question of general damages, sometimes referred to as mesne profits, the effect of the trespass is important.
Mr Griffin described the effects of the dispute on him:
Well, it has been pretty stressful. It - it's - it's five years this month since this whole saga started and the brackets were initially seen on the wall and it's had high personal cost. I think I've changed somewhat and it has affected my family and I have two young kids and this has taken up a lot of time - a two‑year‑old and a seven‑year‑old - and this has taken up a lot of time to - to sort out and it's kind of - it's still not sorted. They're off the wall, but I've got this huge bill and problems still to solve in front of me. It's affected our customers. It's affected my personal life. It's just been terrible. I don't know why - I don't know why it - it - I know why they were put up in the first place, why they couldn't get taken down readily and all - all the effort to try and get some resolution, this has just taken a massive toll (ts 46).
I observed during the giving of this evidence that Mr Griffin became emotional in a way which was genuine and unaffected.
He gave evidence that he was currently employed as a Port Engineer. It was necessary for him to take leave both for the case and during the course of the proceedings:
We haven't had a decent holiday in many years, because I have been keeping it in reserve for all sorts of things associated with this (ts 46).
In assessing damages I also take into account the fact that Mr Lane and LCP had the benefit of the storage provided by the brackets from November 2008 until they were finally removed in May 2011. They also had the advantage of storing things against the wall by leaning items against it.
In Plenty v Dillon [1991] HCA 5; (1991) 171 CLR 635, Gaudron and McHugh JJ:
In his judgment, the learned trial judge said that, even if a trespass had occurred, it was 'of such a trifling nature as not to found (sic) in damages'. However, once a plaintiff obtains a verdict in an action of trespass, he or she is entitled to an award of damages. In addition, we would unhesitatingly reject the suggestion that this trespass was of a trifling nature. The first and second respondents deliberately entered the appellant's land against his express wish. True it is that the entry itself caused no damage to the appellant's land. But the purpose of an action for trespass to land is not merely to compensate the plaintiff for damage to the land. That action also serves the purpose of vindicating the plaintiff's right to the exclusive use and occupation of his or her land (654).
In TCN Channel Nine Pty Ltd v Anning [2002] NSWCA 82; (2002) 54 NSWLR 333, a television reporter and cameraman filmed on business premises and attempted to conduct an interview with a view to broadcasting. General and aggravated damages of $50,000 were awarded. Spigelman J said [104]:
What is a natural and probable consequence arising from a trespass to land must depend on all the circumstances of a case. It is essentially a question of fact. Personal injury to an occupier was a natural and probable consequence of the kind of trespass that occurred in Wormald v Cole [1954] 1 QB 614, that is, the escape of cattle from the defendant's land onto adjoining property. Similarly, injury to a plaintiff's horse was a natural and probable consequence of the act of trespass in Hogan v A G Wright [1963] Tas SR 44, that is, destroying a fence with a bulldozer which allowed horses to escape, one of which was injured in the subsequent roundup. Finally, injury to olive trees on an adjoining property was a natural and probable consequence of permitting cattle to enter it. (Svingos v Deacon Avenue Cartage & Storage Pty Ltd (1971) 2 SASR 126.)
A natural and probable consequence of the continuing trespass was significant inconvenience and some emotional distress to Mr Griffin. An inevitable consequence was damage to the wall brought about by the brackets.
Because it is trite but true to say that each award of damages turns on the particular factual circumstances of the case, examination of other awards of damages is of limited value. Nevertheless, I have looked at some cases to see whether a range can be established.
General damages
Hill v Higgins [2012] NSWSC 270
This was a dispute by neighbours over a mostly brick dwarf retaining wall and mesh dividing fence. In the course of his judgment Harrison J said:
It is difficult in the third millennium to be impressed greatly by the seriousness of a complaint about the legal or circumstantial consequences to a landowner of the temporary deposit of a handful of bricks upon his or her land, or the associated consequences that are claimed to flow from the fact of a person entering upon the same land to remove them. (I put aside for present purposes the apparent inconsistency that arises from concurrent complaints about the bricks being on the land in the first place and the allegedly unauthorised entry onto the land by someone for the purpose of removing them in the second place).
…
Trespass is actionable without proof of material loss. A deliberate trespass is not a trifling matter [34] ‑ [36].
The judge awarded nominal damages of $200.
Whitehaven Coal Mining Ltd v Tomaska [2012] NSWSC 1445
A vendor was allowed to continue to occupy the property on licence for a year but failed to leave. Damages of $26,000 was calculated as the weekly rent for the period after the plaintiff required the defendant to leave.
Quarmby v Oakley and Harper [2011] TASSC 20
This was a boundary dispute over a strip of land which varied from one metre to about three metres in Southport, Tasmania. One party entered onto the strip and used a tractor and pile‑driver to drive a steel railway iron into the other person's land. On another occasion, they trespassed onto the land by walking onto it. Damages were awarded at $400.
Windridge Farm Pty Ltd v Grassi [2011] NSWSC 196; (2011) 254 FLR 87
The defendants trespassed onto the plaintiff's farm and took photographs of a piggery which they gave to Animal Liberation New South Wales. There were a number of aggravating features and an award of $15,000 general damages was made.
Finesky Holdings Pty Ltd v Minister for Transport (WA) [2002] WASCA 206; (2002) 26 WAR 368
The defendant entered into a contract with a company which extracted limestone from an area covered by Finesky Holdings' sub‑lease [51]:
[T]he general principle upon which compensatory damages are assessed in tortious actions is that the injured party should receive compensation in a sum which, so far as money can do, will put that party in the same position as that in which it would have been had the tort not been committed (see, for example, Butler v The Egg and Egg Pulp Marketing Board (1966) 114 CLR 185 at 191 and Haines v Bendall (1991) 172 CLR 60 at 63), although the Court has, in appropriate cases, been prepared to award aggravated and/or exemplary damages (see Uren v John Fairfax & Sons Ltd (1966) 117 CLR 118 at 149 ‑ 150).
The trial judge's award of $1,000 as nominal damages was not disturbed on appeal.
Balanced Securities Ltd v Bianco [2010] VSC 201; (2010) 27 VR 599
A mortgagor let a unit to a tenant without obtaining the consent of the mortgagee. The tenant sublet the unit. A claim for mesne profits was allowed under the Hungerfords principle (Hungerfords v Walker [1989] HCA 8; (1989) 171 CLR 125).
Applying a discount for contingencies, mense profits were calculated on the basis of the rental loss in the sum of $56,230.
State of New South Wales v Ibbett [2006] HCA 57; (2006) 229 CLR 638
In this appeal general damages of $10,000 were not disturbed.
Conclusion on general damages
The damages award (mesne profits), apart from specific loss to which I will shortly turn, is such as to require more than nominal damages. It cannot be calculated precisely on the basis of loss of rent, although free use of the wall for Mr Lane and LCP is a factor. I take into account the inconvenience and distress, the length of time the trespass continued, Mr Lane's recalcitrant attitude and the need to uphold and vindicate a landowner's right to possession.
In all the circumstances, I award $15,000 general damages to Mr Griffin.
Abyss is entitled to damages for the interruption of its quiet possession by the various brackets placed on the wall. The actual physical damage will be compensated elsewhere. There is no evidence that the company has suffered a loss of goodwill or other injuries. I make an award of $500 for the company as nominal general damages.
Exemplary damages
Exemplary damages may be awarded for trespass to land and may be awarded even if liability arises vicariously: NSW v Ibbett.
In Gray v Motor Accident Commission [1998] HCA 70; (1998) 196 CLR 1:
In considering whether to award exemplary damages, the first, if not the principal, focus of the enquiry is upon the wrongdoer, not upon the party who was wronged. (The reaction of the party who is wronged to high-handed or deliberate conduct may well be a reason for awarding aggravated damages in further compensation for the wrong done. But it is not ordinarily relevant to whether exemplary damages should be allowed.) The party wronged is entitled to whatever compensatory damages the law allows (including, if appropriate, aggravated damages). By hypothesis then, the party wronged will receive just compensation for the wrong that is suffered. If exemplary damages are awarded, they will be paid in addition to compensatory damages and, in that sense, will be a windfall in the hands of the party who was wronged. Nevertheless, they are awarded at the suit of that party and, although awarded to punish the wrongdoer and deter others from like conduct, they are not exacted by the State or paid to it [15].
If, as we have earlier suggested, the remedy is exceptional in the sense that it arises (chiefly, if not exclusively) in cases of conscious wrongdoing in contumelious disregard of the plaintiff's rights, at least two further questions arise: are exemplary damages available where the plaintiff's claim is for damages for negligence rather than some intentional wrong, and is the award of exemplary damages a matter of right or does it depend on the exercise of a discretion informed by some identifiable criteria? [20]
No doubt the conduct of the wrongdoer is central to that enquiry: for exemplary damages are concerned to punish the wrongdoer and deter others from like conduct, not to compensate the party that was wronged. But there are other factors which must be considered. In this case, attention was directed to the fact that the defendant was a third party insurer, and that the tortfeasor had been convicted and punished for a criminal offence [31].
In Deutsch v Rodkin [2012] VSC 450 successive caveats were lodged by related parties as a conspiracy to injure the plaintiff:
The principles governing the award of exemplary damages were recently summarised by the Court of Appeal in Carter and State of Victoria v Walker [2010] VSCA 340, in the following terms:
'Exemplary damages are damages over and above those necessary to compensate the plaintiff. They are awarded to punish the defendant. They are intended to act as a deterrent to the defendant, and to others minded to behave in a like manner. They are also intended to demonstrate the Court's disapprobation and denunciation of such conduct. Such damages may be awarded in respect of any tort that is committed in circumstances involving a deliberate, intentional, or reckless disregard of the plaintiff's rights.'
In XL Petroleum (NSW) Pty Ltd v Caltex Oil (Aust) Pty Ltd (1984‑5) 155 CLR 448, Brennan J described the award of exemplary damages:
'As an award of exemplary damages is intended to punish the defendant for conduct showing a conscious and contumelious disregard for the plaintiff's rights and to deter him from committing like conduct again, the considerations that enter into the assessment of exemplary damages are quite different from the considerations that govern the assessment of compensatory damages. This is no necessary proportionality between the assessment of the two categories.
...
The social purpose to be served by an award of exemplary damages is, as Lord Diplock said in Broome v Cassell & Co[1971] 2 QB 354 "to teach a wrong‑doer that tort does not pay".' [77] ‑ [78]
An amount of $25,000 was awarded for exemplary damages.
In TCN Channel Nine Pty Ltd v Ilvariy Pty Ltd [2008] NSWCA 9; (2008) 71 NSWLR 323, a television company's reporters deceptively entered and filmed a person at premises:
[T]hese findings constitute a proper basis for the award of exemplary damages in a case, such as the present, where a tortfeasor has manifested a preparedness to infringe the legal rights of others, and has commercial reasons to continue to do so [28].
The amount of $120,000 in exemplary damages was not disturbed.
Conclusion on exemplary damages
An award of exemplary damages is exceptional. Mr Lane's liability arises principally because of his inaction in failing to have the original brackets removed and by failing to ensure his property was not used to allow further brackets to be installed. There is no evidence that he directly affixed the brackets or that he authorised others to do so.
In these circumstances, his inaction was not contumelious to the extent that requires punishment. Applying the principles set out in Gray and taking into account the significant general and compensatory damages award, a further award of exemplary damages in order to punish Mr Lane is not required.
Damages for the cost of repairing and making good the building
Mr Woodhouse gave evidence that repairs are required to remove the remaining bolts and to fill the holes with a cement based repair mortar. The reason for the removal of the bolts is that they will corrode eventually and expand and thus reduce the life of the panel. The cracking must also be repaired. The cracks above .3 mm can be filled with an epoxy resin. He obtained two quotes (exhibits 32 and 33). I accept these are reasonable, there being no evidence to the contrary. It is reasonable to accept the lower quote. I also consider that supervision by Mr Woodhouse is in all the circumstances reasonable.
The plaintiffs submitted a schedule of damages. Some items are not pressed and some I disallow. The schedule is in the main supported by evidence, which I accept, there being no evidence to the contrary in any event.
Damages for the repair of the building and the survey of the boundaries should be recovered by Mr Griffin.
The damages for the consequential loss to the business should be recoverable by Abyss.
The plaintiffs tendered a quotation from Allied Pickford (exhibit 28) for costs associated with removing, storing and returning stored goods to the premises. The quote appears reasonable.
Mr Griffin explained the need for transit insurance. Normally insurance is a matter for each storer. However, in this case Abyss will effectively be the storer at Allied Pickfords in relation to other persons' property and so the need to provide insurance is reasonable.
A claim for administration costs is disallowed. I accept Mrs Griffin is employed by Abyss at the rate set out in exhibit 27. However, I am not satisfied her salary for administering Abyss during the disruption is a cost caused by Mr Lane's tort. If she is an employee being paid a set amount then the type of work she actually performs does not alter the cost to Abyss.
Legal fees in repair phase is not explained and was not pressed.
There is a claim for costs incurred by the plaintiffs in having the land re‑surveyed by Thompson Surveys in May 2009.
The assertion in the statement of claim par 7 that the Abyss building was on Mr Griffin's land was not admitted (defence par 2). In the circumstances it was necessary for the plaintiffs to prove that fact and the costs incurred in having the land re‑surveyed are allowed.
The compensatory award for actual loss and damage is as follows:
Damages to Mr Griffin Amount
1.Repairs to external and internal panels of the east wall
Acceptance of Savcour quote $11,562.00
Supervision costs for Steve Woodhouse @ $185 $1,110.00
x 6 hours
2.Costs incurred by the plaintiffs in having the land $990.00
re‑surveyed by Thompson Surveys in May 2009
$13,662.00
Damages to Abyss
3.Costs associated with removing, storing and returning
stored goods to the premises, incurred over 3 weeks
whilst the repairs are undertaken
3.1Removal of goods stored in 9 x 6m x 3m units $7,128.00
@ $792 per unit
3.2Removal of 1 x 9m x 3m unit @ $1,452 $1,452.00
3.3Storage of goods (9 units in single containers, $2,614.00
1 unit in double container @ $59.40 per
container per week for 3 weeks)
3.4Transit insurance per consignment (goods $5,500.00
valued at $50,000)
3.5Reimbursement costs for storers to access $880.00
container for goods (1 visit only)
3.6Re‑packing of stored goods @ $264 per unit $2,904.00
(1 unit being a double unit)
3.7Re‑delivery of stored goods to 9 x 6m x 3m $5,256.00
units @ $584 per unit
3.8Re‑delivery of stored goods to 1 x 9m x 3 m $1,168.00
unit @ $584
4.Costs incurred in allowing access for expert inspection
carried out on 18 July 2011
4.1Relocation of 2 units to allow experts' access $248.00
to rear wall
4.3Lost income for 2 units being left vacant $880.00
to allow expert inspections access to rear wall
@ $220 per unit per month plus an additionalmonth per unit of vacant time
$28,030.00
Mandatory injunction
Ms Thompson submitted that the primary relief sought by the plaintiffs is a mandatory injunction. Having regard to Mr Lane's inaction over many years, and the blatant trespass committed, I am satisfied this is an appropriate case for a permanent injunction. Mr Lane is the director and secretary of Casper Holding (WA) Pty Ltd, formerly Lamac Plumbing & Drainage WA Pty Ltd, whose principal place of business is lot 51 Palmer Crescent, Bunbury, from 8 August 2013. He is also the director and secretary of Proto Jacketing Australia Pty Ltd whose principal place of business is lot 51 Palmer Crescent, Bunbury WA 6230. From 23 July 2013 he is therefore the controller of two businesses likely to be carrying on business in place of LCP. He is in a position to exercise control over employees and must now do so.
Orders
I make the following orders that:
1.(a) the first defendant, Michael Reuben Lane;
(b)any company of which the first defendant is a director, manager or associate within the meaning of the Corporations Act 2001 (Cth); and
(c)any tenant or licensee of a party referred to in pars (a) or (b), occupying lot 51 on deposited plan 40538, being the whole of the land in certificate of title vol 2590, folio 645 (lot 51);
be and are hereby permanently restrained from placing, affixing, or causing, or permitting any item whatsoever to be placed on, or affixed to any part of the buildings or land at Lot 50 Palmer Crescent, Davenport, being lot 50 on deposited plan 40538, being the whole of the land in certificate of title vol 2590, folio 644 (lot 50).
2.On not less than five working days written notice to the first defendant, the plaintiffs and their agents be permitted to enter onto and remain on the property at lot 51 for the purposes of effecting repairs to the lot 50 property.
3.Michael Reuben Lane pay damages to the plaintiffs of $57,192, apportioned to the first plaintiff SSYBA Pty Ltd $28,530 and to the second plaintiff Michael Joseph Griffin $28,662.
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: SSYBA PTY LTD -v- LANE [2013] WASC 445 (S)
CORAM: McKECHNIE J
HEARD: ON THE PAPERS
DELIVERED : 21 MARCH 2014
FILE NO/S: CIV 1647 of 2011
BETWEEN: SSYBA PTY LTD
First plaintiff
MICHAEL JOSEPH GRIFFIN
Second plaintiffAND
MICHAEL REUBEN LANE
First DefendantLAMAC COMMERCIAL PLUMBING PTY LTD (IN LIQ)
Second Defendant
Catchwords:
Costs - Whether claim could have been brought in Magistrates Court - Whether order for indemnity costs appropriate - No new principles
Legislation:
Nil
Result:
Order for indemnity costs on Supreme Court scale
Category: B
Representation:
Counsel:
First plaintiff : No appearance
Second plaintiff : No appearance
First Defendant : No appearance
Second Defendant : No appearance
Solicitors:
First plaintiff : Benz Legal
Second plaintiff : Benz Legal
First Defendant : In person
Second Defendant : No appearance
Case(s) referred to in judgment(s):
Ford Motor Company of Australia Ltd v Lo Presti [2009] WASCA 115
SSYBA Pty Ltd v Lane [2013] WASC 445
Vella v Ivanovski (1984) WAR 8
McKECHNIE J: On 13 December 2013 I gave judgment in favour of the plaintiffs: SSYBA Pty Ltd v Lane [2013] WASC 445. The primary relief sought by the plaintiffs was a mandatory injunction which I granted. Damages totalling $57,192 were awarded to be paid to the plaintiffs by the first defendant.
The plaintiffs' claim for exemplary damages was not allowed.
Subsequent to judgment, the parties made submissions on costs. The plaintiffs sought orders for indemnity costs. The general principles are set out in Ford Motor Company of Australia Ltd v Lo Presti [2009] WASCA 115 [16] ‑ [32] which I apply.
The plaintiffs supported the application with an affidavit of their solicitor Ms Benz sworn 18 December 2013. That affidavit discloses that on 13 February 2012 the plaintiffs' solicitors sent the defendants' solicitors an offer of settlement pursuant to the Rules of the Supreme Court 1971 (WA) O 24A. The offer was on the following basis:
1.Your client's provide a fully indemnity for the costs, including consequential costs, of repair works to the East Wall, as advised by Stephen Woodhouse, undertaken by an agreed contractor to the satisfaction of our clients and supervised by Stephen Woodhouse, with the repair works to be undertaken at times convenient to our client's business requirements;
2.Your client's provide the following irrevocable undertaking:
'Until further order, the defendant's be and are hereby restrained from placing on or affixing to, or causing, or permitting to be placed on, or affixed to the East Wall of the premises constructed on Lot 50, any item whatsoever'; and
3.Your client's pay our clients $10,000 being damages for the trespass.
The offer was left open for a period of 28 days.
The defendants' solicitors acknowledged receipt on 14 February 2012 but there was no further communication.
On 19 June 2013 the plaintiffs' solicitors wrote directly to Mr Lane, the first defendant. The offer was:
1.You provide a full indemnity for the costs, including consequential costs, of repair works to the East Wall, as advised by Stephen Woodhouse, undertaken by an agreed contractor to the satisfaction of the plaintiffs and supervised by Stephen Woodhouse, with the repair works to be undertaken at times convenient to the plaintiffs' business requirements;
2.You provide the following irrevocable undertaking:
'Until further order, the first defendant be and is hereby restrained from placing on or affixing to, or causing, or permitting to be placed on, or affixed to the East Wall of the premises constructed on Lot 50, any item whatsoever.'
3.You pay the plaintiffs the sum of $10,000 being damages for the trespass; and
4.You pay the plaintiffs the sum of $13,000, being the costs associated with removing and storage of goods from the plaintiffs' leased storage units, so that the necessary repairs may be undertaken.
…
For the purposes of this offer, we draw to your attention that our clients are prepared to forego their claim for general damages for nuisance and exemplary and punitive damages, for both the trespass and the nuisance, as well as interest on any award of damages.
No response was received.
At trial the plaintiffs recovered more by way of damages than the offer. The first defendant would have been placed in a better position had he accepted the offer and not gone to trial.
In his responsive submissions, Mr Lane submits that O 66 r 17(1) applies:
If an action is brought in the Supreme Court which could have been brought in the Magistrates Court without the special consent of the defendant, the plaintiff shall recover no greater sum by way of costs than he could have recovered had the action been brought in the Magistrates Court, unless the Court certifies that by reason of some important principle of law being involved, or of the complexity of the issues or of the facts, the action was properly brought in the Supreme Court.
He submits that the action could have been brought in the Magistrates Court as the damages awarded are within the jurisdictional limit of $75,000. He submits that the Magistrates Court could have granted an injunction as ancillary relief and as there is no certificate costs should be awarded on the Magistrates Court scale.
The Magistrates Court (Civil Proceedings) Act 2004 (WA) s 11 provides:
(1)The Court has such powers as are incidental to and necessary for the exercise of the jurisdiction conferred on it by section 6 and of the jurisdiction referred to in section 8.
(2)The Court may grant any remedy or relief in respect of a claim within the jurisdiction conferred by section 6 -
…
(b)that the Supreme Court could grant if the claim had been made to that court.
In Vella v Ivanovski (1984) WAR 8 (Wickham SPJ, Wallace & Pidgeon JJ agreeing) said:
The question that should have been asked in terms of the statute was whether, in his opinion, it was proper to bring the action in the District Court instead of in the Local Court and I emphasize whether it was proper to bring the action not whether it was proper to continue it there in the light of subsequent facts or in the light of subsequent negotiations. …
It does seem to me that having regard to what was said by Negus J in Jerinic v Metropolitan (Perth) Passenger Transport Trust (1969) WAR 132 that the central test is whether the applicant or plaintiff in the case when issuing the proceedings might reasonably have been expected to recover an amount in excess of the maximum of the jurisdiction of the Local Court.
Applying that test I consider that the plaintiffs' choice of the Supreme Court was appropriate for the following reasons:
1.Shortly after the proceedings commenced the plaintiffs were prepared to seek an interlocutory injunction. Whether the incidental power under the Magistrates Court (Civil Proceedings) Act s 11 supports the grant of an interlocutory injunction is an open question. However, the plaintiffs' decision to proceed in a court where such a remedy is definitely available was appropriate.
2.At the time of issue of proceedings, damages were at large. The claim for damages included a claim for exemplary damages.
Had exemplary damages been awarded, the claim would have exceeded $75,000. The plaintiffs' case for exemplary damages was reasonably arguable even though in discretion I did not award them.
Conclusions
At the time of issuing the proceedings the plaintiffs appropriately chose to issue those proceedings in the Supreme Court.
The actions of the first defendant in failing to accept either of the offers made under O 24A were unreasonable. In fact it is reflective of his behaviour from the very beginning.
This is an appropriate case for an award of indemnity costs.
I order:
1.Costs to be taxed under the relevant Legal Practitioners (Supreme Court) (Contentious Business) Determination from 13 March 2012. The costs be allowed on an indemnity basis.
2.The first defendant pay the plaintiffs' taxed costs.
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