Botev Trustee Limited v Tait
[2022] NZHC 2129
•29 August 2022
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2022-404-000480
[2022] NZHC 2129
UNDER the Contempt of Court Act 2019 IN THE MATTER OF
an application under s 16 of the Contempt of Court Act 2019 seeking a warrant
committing a person to prison or an order imposing a fine on a person
BETWEEN
BOTEV TRUSTEE LIMITED
ApplicantAND
BRENDON TAIT
Respondent
Hearing: 24 August 2022 Counsel:
TJ Rainey and KK Kommu for Applicant SE Wroe and TJM Ashley for Respondent
Judgment:
29 August 2022
JUDGMENT OF DOWNS J
This judgment was delivered by me on Monday, 29 August 2022 at 10 am pursuant to r 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Solicitors/Counsel:
Pidgeon Judd Law Ltd, Auckland. Jay Park Law, Auckland.
TJ Rainey, Auckland.
KK Kommu, Auckland.
SE Wroe, Auckland.
TJM Ashley, Auckland.
BOTEV TRUSTEE LTD v TAIT [2022] NZHC 2129 [29 August 2022]
The case
[1] The applicant contends the respondent has committed contempt of court by failing to comply with court orders concerning a right of way; hence he should be imprisoned or fined. The respondent contends, among other things, he has complied with the orders, the critical part of which reads:
The Respondent must remove any obstruction that prevents the reasonable use of that right of way at the Respondent’s cost. The Respondent is however only required to restore the land to a natural state.
Background
[2]This can be brief given the issues.
[3] The property at 5 Sunderlands Road, Half Moon Bay, was divided into three cross-lease flats in 1974.1 Flat 3 is furthest from the road. Its driveway is on the western side of the property. Flat 3 also enjoys a right of way over the property’s eastern side. The right of way was created, in 1975, by variation of the lease.
[4] To the east of Flat 2 is an area known as “Area B”. Area B is Flat 2’s exclusive area. However, Area B is also subject to the right of way in favour of Flat 3. A patio space occupies part of Area B. This space is better shown than described, hence the photograph over the page.
1 The property.
[5] Flat 2 is to the right of the photograph. Flat 3 is in the background. The patio space is the area behind the planter box facing the photographer, to the left of the outdoor chair and potted plants. Further to the left is a path leading to Flat 3. As will be apparent, the path permitted pedestrian access only.
[6] Botev Trustee Ltd, or BTL, owns Flat 3. Brendon Tait owns Flat 2. BTL contended the right of way in favour of Flat 3 was vehicular. Mr Tait contended it was pedestrian. The parties submitted their dispute to arbitration and two other disputes in relation to the property.2
[7] In an award dated 6 December 2019, Graham Kohler QC3 held the right of way was vehicular.4 He made what I call the orders:
Right of way
6.1 The right of way access reserved for the benefit of the owner of Flat 3 (the Claimant) is not limited:
(i)to the footpath currently constructed;
(ii)to pedestrian access use only.
The owner of Flat 3 (The Claimant here) is entitled to exercise reasonable vehicular access over Area (B).
2 Was it permissible to use Flat 2 as an Airbnb rental? And, did BTL wrongly disconnect a stormwater pipe on Flat 3?
3 The arbitrator.
4 Botev Trustees Ltd v Tait Partial award of Graham Kohler QC, Arbitrator, 6 December 2019.
6.2 The Respondent must remove any obstruction that prevents the reasonable use of that right of way at the Respondent’s cost. The Respondent is however only required to restore the land to a natural state. By that I mean a grassed evenly sloped state.
6.3 The Claimant is entitled to undertake such works as are required reasonably to construct a concrete or asphalt or the like right of way over Area (B). Such a right of way to be pursuant to an agreed design consistent with local authority requirements as to width and otherwise. In the event of disagreement as to design leave is reserved to either party to seek a further determination by arbitration either by me or someone else. The cost of constructing a concrete or asphalt or equivalent right of way over Area (B) is to be met by the Claimant.
[8] On 9 July 2020, the parties entered an agreement to implement the orders. The agreement foundered when Auckland Council declined Mr Tait’s application for resource consent on the basis removal of the patio space violated (space) rules of the Unitary Plan.
[9] On 1 December 2020, BTL said it was cancelling the agreement because of Mr Tait’s alleged failure to perform it. BTL then applied to the High Court to register the arbitrator’s award as a judgment. Mr Tait opposed the application.
[10] On 26 August 2021, Campbell J granted BTL’s application.5 Consequently, the award is now treated as a judgment of this Court, and the arbitrator’s orders are, subject to an issue raised by Mr Tait, enforceable as court orders.
[11] On 31 March 2022, BTL applied to imprison or fine Mr Tait for non- compliance with the orders.
[12] Mr Tait believes he has complied with the orders. The next photograph shows the patio space and Area B as they are now, following works by Mr Tait. The top of the earth embankment is approximately 2.5 metres wide; its side another 50 centimetres or so.
5 Botev Trustee Ltd v Tait [2021] NZHC 2205.
[13]Before saying more about the parties’ cases, I briefly state the applicable law.
Law
[14] The application is governed by s 16 of the Contempt of Court Act 2019,6 which reads:
16 Certain court orders and undertakings may be enforced
(1) This section applies to—
(a)any interim or final order, decision, decree, direction, or judgment of a court (a court order) to do or abstain from doing something, except as provided in section 17:
(b)any undertaking given to the court if, on the faith of the undertaking, the court has sanctioned a particular course of action or inaction.
(2) A court may enforce the court order or undertaking against the party, non- party, or other person bound by the order or undertaking by taking action provided for in subsections (3) and (4) on application by—
(a)the party who sought the order or undertaking being enforced; or
(b)a person who benefits from, or has an interest under, the order or undertaking; or
(c)the Solicitor-General, if the Solicitor-General is satisfied that there is a high degree of public interest in enforcing the order or undertaking.
6 The Act.
(3) The court—
(a)must not proceed further under this section unless it is satisfied that other methods of enforcing the court order or undertaking have been considered and are inappropriate or have been tried unsuccessfully; and
(b)if so satisfied, must make a finding as to whether it is proved beyond reasonable doubt that—
(i)the court order or undertaking being enforced has been made in clear and unambiguous terms and is clearly binding on the person; and
(ii)the person had knowledge or proper notice of the terms of the court order or undertaking being enforced; and
(iii)the person has, without reasonable excuse, knowingly failed to comply with the court order or undertaking being enforced.
(4) On finding beyond reasonable doubt that the requirements of subsection (3)(b)(i) to (iii) are met, the court may—
(a)do any of the following:
(i)issue a warrant committing the person or a director or an officer of the body corporate, as the case may be, to a term of imprisonment not exceeding 6 months:
(ii)impose a fine,—
(A) in the case of an individual, not exceeding $25,000; or
(B) in the case of a body corporate, not exceeding $100,000:
(iii)order the individual or a director or an officer of the body corporate, as the case may be, to do community work, not exceeding 200 hours, as the court thinks fit:
(b)if the court is the High Court, make a sequestration order in accordance with the rules of court.
(5) An applicant may apply under subsection (2) on 1 or more occasions to enforce the same court order or undertaking, and the court may take further action under subsections (3) and (4) as it thinks necessary to enforce the order or undertaking.
(6) Any enforcement action under this section does not operate to extinguish or affect the liability of the person to comply with a court order or an undertaking.
[15] The material aspects lie in subsections (1) and (3). Obviously, there must be an order requiring the respondent “to do or abstain from doing something”.7 The Court must be satisfied other methods of enforcing the order have been considered and were inappropriate or unsuccessful. In other words, the Court must be satisfied contempt proceedings are not premature.
[16]The Court must then be satisfied beyond reasonable doubt—meaning sure:
(a)The order binds the respondent.
(b)The order is in “clear and unambiguous terms”.
(c)The respondent knew or had proper notice of the terms of the order.
(d)The respondent, has without reasonable excuse, knowingly failed to comply with the order.
[17]Even then, penalty is discretionary under subsection (4).
A précis of the respective cases
[18] BTL contends Mr Tait remains in default of the orders. On behalf of BTL, Mr Rainey argues the orders require Mr Tait to do two things:
(a)Deconstruct the patio space.
(b)Restore the land to a natural state.
[19] BTL relies on the evidence of David Churchill and Anna Crowther. Mr Churchill is a surveyor; Ms Crowther a structural engineer. Ms Crowther says earth has been excavated to create the patio space, and the ground once ran alongside Flat 2 as shown by the diagonal red lines in this photograph.
7 Contempt of Court Act 2019, s 16(1)(a).
[20] Mr Churchill says Mr Tait’s works have compromised what remains of the retaining wall in the patio space, and it “remains an obstacle to Flat 3 using the full extent of the right of way for access”. Mr Churchill says the right of way would “be clear of obstruction if the retaining wall was cut back to the wall of Flat 3”. In other words, and like Ms Crowther, Mr Churchill considers the patio space needs to be refilled so it no longer exists.8
[21] Mr Rainey argues it is self-evident Mr Tait has failed to deconstruct the patio space or restore the land to a natural state. It follows this is a clear instance of contempt of court, in which a penalty is appropriate.
[22] Mr Tait argues he has complied with the orders by the works he has done. Mr Tait relies on the evidence of Brent Clode, a structural engineer. Mr Clode says based on photographs taken in 2004 of the patio space and his site visit of 18 March 2022:
In my opinion Mr Tait has complied with paragraph 6.2 of the Arbitration Decision and has removed “any obstruction that prevents the reasonable use
8 This would, of course, require alterations to the eastern wall of Flat 3. Among other things, the door and windows would need to be removed.
of the right of way” by providing a natural earth embankment approximately
3.0 metres wide in its natural state.
The only aspect in which it does not comply with the award is that it is not “grassed”. Mr Tait has confirmed that he will grass the slope if required by the applicant however, a grassed surface would not be suitable for vehicle access so is not in my view a substantial non-compliance.
[23] On behalf of Mr Tait, Ms Wroe raises other points too, including that the orders are declaratory in nature only, not orders requiring Mr Tait to do something or abstain from doing something. Ms Wroe also argues contempt proceedings are premature. Finally, Ms Wroe says the orders are neither clear nor unambiguous. It follows Mr Tait cannot be said to have knowingly failed to comply with them.9
Analysis
Do the orders require Mr Tait “to do or abstain from doing something”?
[24] At common law, a person cannot commit contempt of court in relation to a declaratory order. The reason is obvious—and definitional. A declaratory order does not require someone to do or not do something; rather, and in accordance with its name, it simply declares a legal position.10 The Act appears to recognise this distinction by s 16(1), as to which see [14] and [15].
[25] However, and contrary to Ms Wroe’s submission, paragraph 6.2 of the orders is not declaratory in nature. For ease of reference, I repeat them:
Right of way
6.1 The right of way access reserved for the benefit of the owner of Flat 3 (the Claimant) is not limited:
(i)to the footpath currently constructed;
(ii)to pedestrian access use only.
The owner of Flat 3 (The Claimant here) is entitled to exercise reasonable vehicular access over Area (B).
6.2 The Respondent must remove any obstruction that prevents the reasonable use of that right of way at the Respondent’s cost. The
9 Ms Wroe accepts the orders bind Mr Tait, and he knew or had proper notice of their terms. So, no analysis of these is required.
10 Webster v Southwarl London Borough Council [1983] QB 698 at 706 and 708.
Respondent is however only required to restore the land to a natural state. By that I mean a grassed evenly sloped state.
6.3 The Claimant is entitled to undertake such works as are required reasonably to construct a concrete or asphalt or the like right of way over Area (B). Such a right of way to be pursuant to an agreed design consistent with local authority requirements as to width and otherwise. In the event of disagreement as to design leave is reserved to either party to seek a further determination by arbitration either by me or someone else. The cost of constructing a concrete or asphalt or equivalent right of way over Area (B) is to be met by the Claimant.
[26] Paragraph 6.2 requires Mr Tait to “remove any obstruction that prevents the reasonable use of that right of way at the Respondent’s cost”. It makes clear Mr Tait “must” do this. The paragraph then contains a qualification, limitation or elaboration: Mr Tait is “however only required to restore the land to a natural state”, by which is meant “a grassed evenly sloped state”. Paragraph 6.2, therefore, requires Mr Tait “to do … something” in terms of s 16(1) of the Act. It follows it is an order governed by the Act.
[27] Ms Wroe observes the arbitrator could have expressed himself differently, by saying, for example, Mr Tait is under an obligation not to obstruct the right of way. True, but this is not how paragraph 6.2 is framed. Moreover, it is clear from the preceding paragraph this aspect of the orders is intended to require Mr Tait to do something. Paragraph 6.1 is an apparently declaratory order the owner of Flat 3 “is entitled to exercise reasonable vehicular access over Area (B)”. Paragraph 6.2 gives effect to that declaration by requiring Mr Tait, at his cost, to “remove any obstruction that prevents the reasonable use of that right of way”. Nothing in the award suggests this aspect was intended to be other than performative.
[28] Ms Wroe also contends paragraph 6.2 of the orders is insufficiently prescriptive to constitute an order governed by the Act. I accept an order may be so open-ended, vague, or both, it does not constitute an order within s 16(1) of the Act, and therefore not one amenable to sanction for contempt. However, despite the difficulties attaching to paragraph 6.2 of the orders, about which more below, it could not be said they are so vague or open-ended as to fall beyond s 16(1). Expressed another way, while doubt may attach to what, exactly, the orders require Mr Tait to do, it is clear they require
him, again at his own cost, to “remove any obstruction that prevents the reasonable use of [the] right of way”.
Am I satisfied contempt proceedings are not premature?11
[29] Ms Wroe argues BTL could apply for an injunction “to direct what Mr Tait is required to do to give effect to its rights under the lease”, and this should, at least, be explored.
It is not clear what this would add, beyond time and cost.
[31] Ms Wroe also argues further arbitration could be used to clarify the parties’ obligations, especially as the arbitrator gave leave for the parties to return to arbitration. She notes the award contemplated their return; the arbitrator described it as a “Partial award”.
[32] There may well be something in this point, especially as the possibility of further arbitration was the subject of potentially favourable correspondence between the parties in late 2021 and early 2022. However, it not necessary to determine it, for, even if it were resolved in BTL’s favour, I am not sure:
(a)The orders are in “clear and unambiguous terms”.
(b)Mr Tait, has without reasonable excuse, knowingly failed to comply with them.
Remaining pre-discretion elements
[33] The concern underlying these elements is that it is not clear, at least to the criminal standard, what, exactly, the orders require Mr Tait to do. I make five interrelated points.
[34] First, a little more law is instructive. A right of way does not entitle the beneficiary of the right “to go over every part of the surface of the land over which the
11 This is a convenient shorthand for the requirement in s 16(3)(a) of the Act, not more.
way exists”.12 Similarly, “not every instruction of the [right of] way amounts to an unlawful interference”.13 So, while the arbitrator concluded BTL was entitled to exercise reasonable vehicular access over Area B, this conclusion did not necessarily touch on every part of Area B or the patio space.
[35] Second, there was no expert evidence before the arbitrator about how vehicular access over Area B could be achieved. This is hardly surprising; that was not the issue before him. Rather, the issue before the arbitrator was “the nature and extent of the right of way”.14 BTL argued the right of way “permits vehicle passage through Area B”. Mr Tait claimed BTL was “only entitled to pedestrian access through … Area B on the 600 mm pedestrian right of way that has been constructed over the years”.
[36] Third, the arbitrator did not conclude how reasonable vehicular access over Area B should be achieved, other than by the very general terms identified in the orders.
[37] Fourth, it is hardly surprising the arbitrator was not more prescriptive—no one asked him to be. The assumption appears to have been that once the arbitrator determined whether the right of way permitted pedestrian or vehicular access, everything else would be agreed, or follow, as a matter of course. Or, the parties would return to the arbitrator. As will be apparent, these assumptions were misplaced.
[38] Fifth, if the arbitrator concluded Mr Tait was required to make Area B like that identified in the photograph at [19], the terms of the orders are a curious fit. For example, one would expect them to refer to the entire patio space being refilled, yet the orders say nothing about this. Indeed, the orders refer to Mr Tait “only” being required to restore the land to a natural state. Similarly, one would expect the award, if not the orders, to refer to the doors and windows of the adjoining wall of Flat 2 being removed to facilitate the patio space being filled. Neither says anything about this.
12 DW McMorland and others Hinde, McMorland and Sim: Land Law in New Zealand (looseleaf ed, LexisNexis) at [16.050].
13 At [16.050].
14 Botev Trustees Ltd v Tait Partial award of Graham Kohler QC, Arbitrator, 6 December 2019 at para 3.5.
[39] BTL offers an alternative scenario, under which Mr Tait must build a retaining wall to hold the earth embankment in place (thereby allowing him to keep some of the patio space). This submission confronts a similar difficulty: the orders say nothing about the construction of a retaining wall.
[40] All of which is to say it is reasonably arguable Mr Tait has complied with the orders. On one view, he has removed any obstruction that prevents reasonable use of the right of way (by restoring the land to a natural state). This is consistent with the view expressed by Campbell J. He inferred paragraph 6.2 required Mr Tait “to remove some of his patio”.15 Mr Tait has done that. The Judge also noted the paragraph was “not prescriptive as to how much must be removed”.16 Therein lies some of the difficulty.
[41] This is not to conclude Mr Tait has complied with the orders. Rather, it is to identify the existence of a reasonable doubt about non-compliance and related doubt about wilful non-compliance, in turn referable to the confined issues before the arbitrator; the very general terms of the orders (reflecting those issues); the somewhat elastic nature of the right in question; and the different ways in which the orders could, reasonably, be given effect.17
Discretion
[42] As will be obvious, the discretion is not reached. But, even if it had been, I would not have exercised it. Sanction in this context is typically reserved for a recalcitrant defendant, or an egregious breach. Neither situation is engaged.
A final issue
[43] Mr Clode and Mr Churchill both offered evidence on whether Mr Tait had complied with the orders. I decline to receive this aspect of their expert testimony. It is not substantially helpful.18 This is for me alone to determine.
15 Botev Trustee Ltd v Tait, above n 4, at [45(b)] (emphasis added).
16 At [45(b)].
17 Mr Rainey says a diagram showing the original ground level depicted in the photograph at [19] was before the arbitrator, and it therefore follows the orders contemplate a return to that. Again, the orders do not make this clear beyond reasonable doubt.
18 Evidence Act 2006, s 25.
Result
[44] The application is dismissed. Mr Tait should have 2B scale costs. If the parties disagree, they may file memoranda of not more than five pages each:
(a)Mr Tait on or before 10 October 2022.
(b)BTL on or before 17 October 2022.
……………………………..
Downs J
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