Johnson v Barry Park Investments Limited
[2019] NZHC 596
•27 March 2019
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2018-404-455
[2019] NZHC 596
BETWEEN XANTHE ANNA JOHNSON AND MARK ANDREW GRAHAM
PlaintiffsAND
BARRY PARK INVESTMENTS LIMITED
Defendant
Hearing: 12 – 15 and 20 February 2019 Appearances:
K Quinn and C Pearce for the Plaintiff
G J Kohler QC and S J Neville for the Defendant
Judgment:
27 March 2019
JUDGMENT OF MUIR J
This judgment was delivered by me on Wednesday 27 March 2019 at 3.30 pm pursuant to Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar Date:………………………….
Counsel
K Quinn, Barrister, Auckland C Pearce, Barrister, Auckland
G J Kohler QC, Barrister, Auckland
Solicitors:
Heimsath Alexander, Auckland Ellis Gould, Auckland
JOHNSON v BARRY PARK INVESTMENTS LIMITED [2019] NZHC 596 [27 March 2019]
TABLE OF CONTENTS
Introduction [1]
Background facts including relevant findings [7]
The plaintiffs’ claims [15]
The issues [19]
Does the wall encroach on the plaintiffs’ access way? [21]
Is the wall a “wrongly placed structure”? [31]
Other relevant statutory provisions [47]
To what extent is “ownership” of the wall relevant? [54]
Are there claims in nuisance and trespass? [64]
Has the defendant adopted or continued the trespass? [69]
Discretionary factors relevant to relief under the Act [72]
Remedy [96]
Result [128]
Costs [129]
Introduction
[1] The plaintiffs and the defendant are, respectively, the owners of 24 and 22 Tawari Street, Mt Eden. It is in an area of the city once called “Rocky Nook”, which is towards the western edge of the Mt Eden lava flow. The street descends steeply to the west. To establish level building platforms for several of the properties in the street, rock walls have been built using the plentiful local basalt. One such wall is located between the defendant and plaintiffs’ properties. Sitting atop the wall with its bearers, in some cases directly on the graded rock, is an old (probably C 1885) villa in a very deteriorated condition. It is occupied by a Mr Martin Burton for whom the defendant (solicitor’s) company holds the property on trust. Although the house does not in many places have wall linings, and enjoys only the most basic amenities, and although Mr Burton is a wealthy man1 with the capacity to either restore the house or redevelop the property, he appears to like it as it is. He has lived there now for over 30 years.
[2] Unfortunately, the wall on which the house sits (and indeed a small part of the house itself) is substantially located on the 3.05 metre surveyed driveway which leads to number 24 (which is a rear lot). The wall itself is substantial – about 2.5 metres high at the road and tapering out towards a natural rocky outcrop at the rear of Mr Burton’s house.
[3] The house at number 24 is also very much at the end of its economic life. It is occupied by two young architects and their young child. They bought it in 2012 with the intention of redeveloping the site. Their most recent plans are for two town houses and a duplex. This is significantly fewer dwellings than allowed under the intensive zoning which applies to both the plaintiffs’ and defendant’s properties, but they consider it an appropriate style of development.
[4] They say, however, that there is little prospect of them obtaining resource consent for their proposal (assuming at least one car space/garage per dwelling which they consider the market demands) without the infringing wall being relocated within
1 The evidence establishes him as beneficially owning multiple properties throughout Auckland and Northland, in many cases unencumbered and in others with modest mortgages. His properties at 22 and 22A Tawari Street have a combined valuation of $2.775 M and are unencumbered.
the defendant’s boundary.2 On the plans they have developed (which include construction of a new reinforced concrete wall) the cost of so doing could be in the vicinity of $400,000.
[5] The parties cannot agree about whether a new wall needs to be built and, if so, in what location3 and who should bear the cost of it (or, if both parties, what the incidence of that cost should be). They pass all these potentially difficult issues to the Court for it to assess.
[6] In that context the plaintiffs invoke both common law remedies (in nuisance and trespass) and the Court’s statutory jurisdiction under ss 321 to 325 of the Property Law Act 2007 (the Act) to grant relief in respect of “wrongly placed structures”. They say that the Court should authorise them to construct a new wall within the defendant’s property and at its expense. Initially the defendant counterclaimed for an injunction based on alleged rights of natural support, but that argument was not maintained at trial.
Background facts including relevant findings
[7] Subdivision of the area in which the plaintiffs’ and defendant’s properties are located appears to have first occurred in or around 1882.4 A house (likely to have been considerably smaller than the existing dwelling which has been subject to numerous alterations and additions over time), appears to have been constructed on the defendant’s land (which was first transferred in 1884), by at least 1889.5 Since the house sits on top of the wall,6 it can safely be concluded that it (or at least a significant part of it) was built during the mid-to-late 1880’s.
2 As to the minor infringement caused by the defendant’s house, they are confident dispensation could be obtained on a resource consent application and do not therefore seek a demolition order.
3 Whether on the defendant’s land with the face of the wall comprising the boundary, or the plaintiff’s land, or with the central line of the wall comprising the boundary.
4 The last digit of the date is not legible on the relevant deposited plan.
5 Contemporary records of the Mt Albert Road Board invited review of applications for identified local works at “Mr Gilbert’s at Rocky Nook”, W. R Gilbert being the then owner and a clerk in the employ of the Board.
6 More accurately, the edge of what is effectively a rock reclamation.
[8] Furthermore, since the base of the wall consists, for much of its length,7 of hand placed basalt rocks it can also safely be concluded that the number 24 driveway levels (where adjacent to the base) were those that pertained in the mid 1880’s.
[9] Of course, formation of what is now the driveway may have involved eliminating various natural humps and hollows, but I am unable to accept, as the defendant’s geotechnical engineer Mr Williams invites me to do, that large scale excavation was involved in the creation of the driveway and that the wall therefore provides natural support to number 22, possibly to the extent of 1.5 metres or more at various points along the boundary.
[10]I come to that conclusion for the following reasons:
(a)The base of the wall is approximately level (albeit on a gentle incline north to south) with the footpath and edge of the road formation. In turn, where the wall reaches the footpath it continues at a right angle in front of the defendant’s property ultimately tapering out towards its eastern boundary. In so doing the wall created the opportunity for a level platform for the defendant’s house which is well above street level.
(b)There would have been no point in excavating the access way, let alone by 1.5 m or more, to have left it at a lower level than the footpath and road. Mr William’s position therefore invites the conclusion that the footpath and road have themselves been lowered substantially from the natural contour level.
(c)There is no evidence that such extensive road works occurred at or about the time of initial subdivision and it seems unlikely, given the equipment available to 19th Century road-makers, that they would have wished, in what was difficult and rocky terrain, and which was likely intersected by numerous shallow basalt outcrops corresponding to
7 Well down its length and in the vicinity of the rear most portion of the defendant’s house the wall is built over and around a natural rocky outcrop which continues to ground level.
original lava flows, to have modified the contour to that extent. A more likely scenario, in my view, is that the road essentially followed the natural contour.
(d)Mr Williams response is to suggest that the road had/could have been excavated at a later time, but again there is no evidence of that and again it seems inherently unlikely that whoever owned the land now comprising number 24 would, in the mid 1880’s, have wanted to excavate an access below what would have been the road and footpath level.
(e)Prior to 1957,8 numbers 24, 26 and 28 Tawari Street were comprised in one rectangular title. Numbers 26 and 28 were then subdivided off, each with Tawari Street frontages leaving number 22 as a rear lot serviced by the access strip. Again, it seems inherently unlikely that a major excavation would have been undertaken along the boundary of numbers 22 and 24 using 19th Century technology when the then owner of number 24 had available to him or her what were likely to be simpler options for the establishment of access (over the areas now comprising numbers 26 and 28).
(f)Aerial photographs dating from both 1940 and 1958 show that physical access to what is now the plaintiffs’ house predates lodgement of the 1957 subdivision plan and construction activity on numbers 26 and 28, suggesting that the existing formation has always been regarded as the most convenient. That is unlikely to have been the case if it involved extensive excavation.
(g)Although Mr Williams suggested that the very high retaining wall (he considered it possibly about 10 metres tall) between numbers 15 and 17 on the opposite side of the street indicates that the site at number 15 was created by excavation, which might therefore be considered
8 The relevant survey was conducted in January 1957 but the subdivisioned plan was not deposited until December 1958.
characteristic of the area, I am not persuaded. The natural contour drops very steeply to the north in the vicinity of numbers 15 and 17, and it is at least equally plausible that the base of that wall also is at (or about) natural ground level with the height of the wall – simply reflecting the extent of construction necessary to establish a level building platform for number 15.
[11] On the balance of probabilities I therefore conclude that no substantial excavation occurred along the access strip and that, for the length of the access way, the base of the wall broadly corresponds to natural ground level.
[12] Again on the balance of probabilities, I find the purpose of the wall was to provide a level platform for the construction of a house on number 22 – the western boundary of that property having formerly been approximately two and a half metres lower than the eastern at the north west corner, along with a gentle south to north contour which had to be accommodated. That conclusion is supported by the observations of the plaintiffs’ geotechnical expert Mr Black. He noted loose basalt cobbles without interspersed soil, directly under the floor in the south east corner of Mr Burton’s house – indicating that graded fill was used some distance from the wall. It is also supported by Mr Black’s physical examination of the underfloor area adjacent to the wall (an exercise not conducted by Mr Williams) which indicated “stacked boulders” extending “a long way back (a metre or more) from the face of the wall into the area under the mid-section of the dwelling”. He contrasted this with a “shallow veneer or facing over natural rock” and his observations are clearly consistent with the introduction (or relocation from other parts of the property) of substantial quantities of material along the western boundary.
[13] I do not accept, as Mr Kohler QC invites me to do, that the wall was constructed as much to contain a fretting slope between numbers 22 and 24 as to provide a platform for number 22. I do not consider the natural contour across number 22 sufficiently steep for that to have been a relevantly animating concern, particularly given the approximately 15,000 years that have elapsed since the Mt Eden eruption and the opportunity for a natural stable contour to be established over the intervening period.
[14] I return to these findings in the context of Mr Kohler’s submission that, although the face of the wall encroaches significantly into the access way, it cannot be considered an encroachment in a legal sense because the wall is a common or party wall.
The plaintiffs’ claims
[15] The plaintiffs plead three causes of action. In the first, they allege that the wall is a wrongly placed structure for the purposes of pt 6 sub-pt 2 of the Act. They claim it is just and equitable that the Court should grant them relief and, in addition to a declaration as to the wall’s status, seek orders either directing the defendant to remove the encroachment or permitting the plaintiffs to do so and, in that event, requiring the defendant to bear the costs of removal and reinstatement or replacement.
[16] The second cause of action is in nuisance. It alleges that Mr Burton, as beneficial owner of the property, was aware of the encroachment since at least February 2013 and has failed to take any steps to abate it. It is alleged that if the encroachment is not removed, the plaintiffs will suffer loss by virtue of their inability to their property and in terms of its development potential. The relief sought is a mandatory injunction seeking removal of the encroachment, with an alternative claim for equitable damages in lieu of injunction and in an amount to be quantified “representing the diminution in value of the plaintiffs’ property”.
[17] The third cause of action is in trespass and relies on the same facts and particulars of alleged loss as the nuisance claim. The relief sought is also in identical terms.
[18] These causes of action are not pleaded in the alternative. This reflects the position under s 323(4) of the Act which provides that the granting of relief under sub- pt 2 does not deprive any person of any claim they might otherwise have for damages.9
9 In its terms, the reservation applies to damages claims only. This is because the relief granted under the Act will typically substitute for any injunction order which may have been sought. The injunction sought in the plaintiffs’ second and third causes of action should technically be considered alternative remedies to relief sought in the first.
The issues
[19]These appear to be as follows:
(a)Does the wall encroach onto the plaintiffs’ access way?
(b)Is the wall a “wrongly placed structure” for the purposes of pt 6, sub- pt 2 of the the Act or does it give rise to an actionable trespass or nuisance?
(c)If so, what relief (if any) should the Court grant?
[20] There are, however, some subsidiary matters which need to be addressed. I will identify these under separate heads.
Does the wall encroach on the plaintiffs’ access way?
[21] It is undisputed that the face of the wall lies (at some points substantially) over the plaintiffs’ access way. The surveyed width of that access way is 3.05 metres. Adjacent to the footpath the distance from the base of the wall’s face to the western boundary of the access way is 2.82 metres. At that point both a small portion of the top of the wall and its entire face are within the title of number 24. As one moves further south, the level of intrusion is greater. So, for example, at a point under the enclosed veranda of Mr Burton’s house the width is 2.6 metres only. Proceeding further south the access way widens slightly to 2.7 metres before narrowing dramatically underneath the laundry/bathroom annex at the rear of Mr Burton’s house. Here the wall extends out to join a natural basalt outcrop leaving a distance of 1.28 metres only between the base of the wall and boundary of the access way. The natural basalt outcrop (which the plaintiffs accept the defendant has no responsibility to remove and which the plaintiffs will need to cut back in order to establish lawful access) then extends further into the access way.10 As the base of the wall extends out to meet the outcrop, so too the top of the wall11 comes to be largely within the access
10 The actual distance is unmeasured on the relevant survey, but I estimate the maximum incursion to be approximately 2.4 metres, leaving an available legal access way of .605 metres.
11 Which, at this point, starts to be distinct from the material behind it.
strip. That continues to be the case southward to the point where the access strip opens into the plaintiffs’ property. The distance between the base of the wall and the edge of the access strip is at that point 2.05 metres only.12
[22] Beyond the point at which the entrance way opens into the plaintiffs’ property the wall assumes a freestanding character. It is at that point almost entirely located on the plaintiffs’ land. That problem has been exacerbated by the 1957 resurvey which, at the southern-most portion of the boundary, adjusted the boundary line by 20 centimetres to the east. That being the case, an adjustment of 10 centimetres midway along the boundary can also be assumed. It was accepted by the surveyors called for both parties that this adjustment to the 1882 survey should now be accepted as correct. It does not, in my view, materially affect any of the outcomes in this case.
[23] At one point (at its southern extremity) the defendant’s house itself encroaches over the access way by some 7 centimetres. The plaintiffs do not seek any relief in that regard – an accommodation which I consider relevant to my overall assessment of the merits of their position.
[24] Although the above summary is largely uncontentious on the survey evidence the defendant’s expert, Mr Finlayson, eschews the word “encroachment” in a position which mirrors the submission of Mr Kohler. That submission is, as I have indicated, to the effect that no part of the wall can be considered an encroachment because its legal status is that of a “common” or “party” wall. I cannot accept that submission.
[25] There are four types of party wall recognised in the seminal authority Watson v Gray13 and which Hinde McMorland & Sim Land Law in New Zealand summarise as follows: 14
(a)a wall of which the adjoining owners are tenants in common;
(b)a wall divided longitudinally into two sections, one belonging to each of the adjoining owners;
12 At this point the wall is much reduced in height and can be distinguished from the material retained by it.
13 Watson v Gray [1880] 14 ChD 192.
14 Hinde, McMorland & Sim Land Law in New Zealand (LexisNexis, Wellington, 1997) at [6.054].
(c)a wall which belongs entirely to one of the adjoining owners but is subject to an easement in favour of the other to have it maintained as a dividing wall; or
(d)a wall divided longitudinally into two sections each section being subject to a cross-easement in favour of the owner of the other.
[26] The text goes on to state that under the Land Transfer system, party walls in the first category can only be created where the adjoining owners are, at the time the wall is built, tenants in common of the underlying land. That is not the case here. Nor do the third and fourth categories apply, as there are no party wall easements recorded on either parties’ title.
[27]In respect of the second category Hinde states that:
Where a wall is built on the boundary … so that the centreline of the wall coincides with the boundary line, the property in the wall follows the property in the land upon which it stands even though the wall was built at the joint expense of the parties.
[28] The text cites Matts v Hawkins as authority for that proposition.15 That case establishes that if adjoining owners build a wall at joint expense, precisely along the boundary so that “one half of the thickness stands on the land of each” the wall is owned up to the boundary line by each owner, rather than as tenants in common.
[29] I accept the plaintiffs’ submission that such circumstances plainly do not apply in this case. The wall does not have an identifiable centreline. As I have indicated, for much of its length what presents as wall is simply the western face of a much deeper artificial building platform on the defendant’s property. Moreover, to the extent it can be considered to have a centreline, it is not divided by the two properties. And there is no evidence that the wall was built by adjoining owners at their joint expense. To the contrary, I have found that, on the balance of probabilities, at least to the extent the wall provides a foundation for the house and supports its front garden,16 it was erected by the then owner of number 22 to establish a level building platform and curtilage.
15 Matts v Hawkins (1813) 5 Taunt 20.
16 I use the term “garden” loosely. It is an almost impenetrably overgrown area.
[30] The defendant relies on the Court of Appeal’s decision in Tram Lease v Croad, but in my view, it does not assist.17 In that case the rear wall of a shoe repair shop had been built over the boundary when the two sites were in common ownership. The owner then leased the shoe repair site and created a party wall easement over the wall. The easement was intended to be renewable with the lease but apparently the District Land Registrar insisted that such provision be deleted. As a result, the shoe repair site lost the benefit of the easement when the lease was later renewed. This did not preclude relief under s 129 of the Property Law Act 1952 – the predecessor provisions to those now in sub-pt 2 of the 2007 Act. Nor did the fact that the two properties were in common ownership at the time the wall was built, nor did the fact that it was deliberately placed over the boundary. The case is certainly not authority for the proposition that a structure placed off title can be considered a common or party wall.
Is the wall a “wrongly placed structure”?
[31] The gateway to relief under sub-pt 2 of the Act is identification of a “wrongly placed structure”. This is defined in s 321.
wrongly placed structure means a structure that—
(a)is situated on or over the land affected, not being the land intended for the structure (whether or not the land intended adjoins the land affected); or
(b)is situated on or over the land affected but was not placed there—
(i)by, on behalf of, or in the interests of a person who was, at the time, the owner of the land affected; or
(ii)under a contract made with, or by way of a gift made to, a person who was, at the time, the owner of the land affected.
[32] “Land affected” is in turn defined as meaning “any land on which a structure is actually situated” and “land intended” as “any land on which a structure was intended to be situated”.
[33]“Structure” is defined in s 4 to mean:
any building, driveway, path, retaining wall, fence, plantation or other improvement
17 Tram Lease v Croad [2003] 2 NZLR 461 (CA).
and includes for the purposes of sub-pt 2 a partially built structure and “any part of a structure”.18
[34] Relief is not, however, available under the Act if the wrongly placed structure is a fence (in which case disputes are to be resolved, by exercise of the jurisdiction conferred by s 24 of the Fencing Act 1978).19
[35]“Fence” is in turn defined in s 2 of the Fencing Act 1978 as meaning:
A fence, whether or not continuous or extending along the whole boundary separating the lands of adjoining occupiers; and includes all gates, culverts and channels that are part of or are incidental to a fence; it also includes any natural or artificial watercourse or live fence, or any ditch or channel or raised ground that serves as a dividing fence.
[36] While possibly not the most helpful definition, I accept the plaintiffs’ submission that the retaining wall at issue in these proceedings is self-evidently not a fence. Equally clear, however, is the fact that it comprises a “structure” for the purposes of sub-pt 2.
[37] In alleging that the wall constitutes a wrongly placed structure, the plaintiffs rely primarily on the definition in sub-para (a)—“a structure on or over land affected not being the land intended for the structure”.
[38] Mr Quinn submits that, although the definition at first blush suggests an investigation into the subjective intentions of whoever built the structure, that is not the case. He relies on two recent authorities for the proposition that the reference to “land intended for the structure” refers to the land that the structure is intended to serve. Thus the question is not what was in the mind of the builder but rather, what was the evident purpose of the construction.
[39] The first of these decisions is Duncan v Taylor.20 In that case the respective proprietors of a cross-leased property had gradually expanded their flats to exceed the footprints reserved for building under the cross-lease plan. The plaintiffs’ flat
18 See inclusive definition of “Structure” in s 321.
19 Section 323(3).
20 Duncan v Taylor [2010] 12 NZCPR 235 (HC).
encroached on a common area and right-of-way as well as on an area of land set aside for the flat owner’s exclusive use, but on which building was not permitted. The defendants’ flats also encroached on common areas. The plaintiffs sought relief under sub-pt 2. The defendants argued that they were precluded from doing so because, having deliberately built on common property, their extensions could not be considered a “wrongly placed structure”. In doing so they relied on a District Court decision in Aitken v Mitchell.21
[40]Rodney Hansen J rejected that submission. He held that:
… There is nothing in that part of the definition to suggest that the structure would not be wrongly placed if the person placing it on the land acted deliberately, with knowledge that he or she was not entitled to place the structure there. The definition is apt to cover both intentional and inadvertent acts.
[41] In the result, he declined to order any of the owners to remove their respective encroachments, instead ordering a rectified plan and requiring each encroaching owner to pay compensation for the land they had effectively appropriated.
[42] On the defendant’s counter-claim for trespass, the Court found the cause of action made out, but held that the defendant had not substantiated any claim to damages.
[43] Boyer v McCracken likewise involved a cross-lease – in that case of a front and rear flat.22 The structure at issue was a path that provided access from the shared driveway to the front porch of the plaintiffs’ rear flat. The path pre-dated the 1992 cross-lease subdivision. At the time each party had purchased their respective properties, there was a fence between the path and the garden of the defendant’s roadside flat, suggesting that the path was part of the plaintiffs’ rear property. In reality, the true boundary was on the other side of the path, meaning that the path formed part of the defendants’ leasehold estate. The plaintiffs sought relief under sub- pt 2. As in Duncan v Taylor, the defendant argued that the Act could not apply as the
21 Aitken v Mitchell DC Christchurch CIV-2007-009-1810, 4 August 2008.
22 Boyer v McCracken [2017] NZHC 755.
path was not a wrongly placed structure. That submission was rejected by Hinton J. Her findings were as follows:
[46] In this instance, as noted, the path has been in place since well before the subdivision and was clearly intended to create access to the porch, front door and eastern boundary of Flat 1 at a time when Flat 1 was the only building on the land.
[47] Counsel for Ms McCracken submits that, given the path was intentionally constructed in its current position and on the correct land, which is land Ms McCracken now owns, her land has always been both the land intended and the land affected. Logically, therefore, the path was not “wrongly placed”.
[48] It seems to me that the definitions of “land affected” and “land intended” do not need to be so narrowly read. They can refer to the present situation, not just the position at the time the structure was placed.
[49]This is made clear by s 322(2) which specifically provides that:
The application may be made whether the wrongly placed structure was placed on or over the land affected˗˗
(a)before or after any boundary of that land or of the land intended for the structure was fixed; or
(b)before or after this Act comes into force.
(emphasis added)
[50] I also do not agree that it is a precondition to s 322(2) that the path qualifies under s 321. Section 322(2) clarifies and is to be read together with s 321.
[51] Further, as the plaintiffs submit, many wrongly placed structures will have been intentionally placed where they are, for whatever reason. Part 6, Subpart 2 is designed to provide for that situation, where appropriate.
…
[59] The subdivision having occurred after the path was there, turned the path into a wrongly placed structure. After creation of the new boundary line, the plaintiffs’ property is the land on which the structure was intended to be situated and Ms McCracken’s property is the “land affected”, or land on which the structure is actually situated.
[44]Subsequently the Court noted that:
[75] … The path obviously goes with Flat 1. It provides access to the front door and down the eastern side of that property.
[45] These cases establish that the essential inquiry is not one based on the intention of the builder but on a common-sense assessment of what is the purpose or function of the structure. In that context the inquiry into which property it “goes with” handily defines the concept.
[46] In this case the passage of 140 years means that it is not possible to state with certainty why the wall encroaches over the boundary of number 22. But no such finding is essential for the jurisdiction in sub-pt 2 to be invoked. Indeed, Boyer v McCracken establishes that even if the wall was built before the boundary between number 22 and its neighbour to the west was fixed, this would not alter the outcome. Rather, the essential focus is on the wall’s function. That function was (and is) to establish a level building platform for what is now Mr Burton’s house. Indeed, it forms the foundations of the house. In my view, the wall clearly “goes with” that property which is therefore the property “intended” for the structure. To the extent it encroaches on to the plaintiffs’ property the structure is, in my view, therefore appropriately considered “wrongly placed”.23
Other relevant statutory provisions
[47] Section 322(1) prescribes who may apply for relief under the Act. Among such persons are the owners of land affected by the wrongly placed structure. I accept the plaintiffs are in that category on account of the limitations on access resulting from the encroachment. At the moment, vehicular access to their house occurs by the grace and favour of the owners of number 26. Out of necessity the physical formation of the driveway in fact departs almost completely from the title of number 24 as it approaches the end of the surveyed access way. In addition, I accept that the current location of the wall, which at the point of greatest encroachment reduces the available legal access to 1.28 metres only, has a prejudicial effect on the way in which number 24 may in the future be developed. I will discuss that development potential more fully later in this judgment.
23 I repeat in that context my earlier finding that, on the balance of probabilities, I do not consider the wall to have been built as a “protection mechanism” for number 24 against rockfall from number 22.
[48] Section 322(2) in turn provides that an application may be made whether the wrongly placed structure was placed on or over the land affected:
(a)before or after any boundary of that land or of the land intended that the structure was fixed; or
(b)before or after the 2007 Act came into force.
It was this provision which featured significantly in the Duncan v Taylor decision.24
[49] Section 323 sets out the Court’s jurisdiction. It may grant relief to any person entitled to apply “if [it] considers it just and equitable in the circumstances”. In Guo v Bourke the Court of Appeal stated that the special powers of Court in pt 6 of the Act (including obviously those in sub-pt 2):25
… are remedial, and hence are typically expressed in broad terms. Generally relief may be granted when the court considers it just and equitable, and orders may be made on such terms and conditions as the court thinks fit. The Courts are therefore empowered to make pragmatic but principled decisions in circumstances where, as here, neighbours are unable to resolve disputes that have arisen.
[50] Section 324 then identifies a number of matters which the Court may consider in determining applications for relief. These are:
(a)the reasons why the wrongly placed structure was placed on or over the land affected; and
(b)the conduct of the parties; and
(c)the extent to which any person has been unjustifiably enriched at the expense of the person seeking relief because the owner of the land affected has become the owner of the wrongly placed structure.
[51]Significantly, s 324(2) provides:
Subsection (1) does not prevent the court from granting relief merely because the person seeking relief knew of the true boundaries or ownership of the land affected at the time that the structure was placed there, or at the time when that person became the owner of, or acquired an estate or interest in, the land affected, the land intended, or the structure.
24 Duncan v Taylor [2010] 12 NZCPR 235 (HC).
25 Guo v Bourke [2017] NZCA 609 at [12].
[52] This subsection is significant in that it brings to the statutory jurisdiction a principle analogous to the common law rule that an action in trespass is not precluded by a claimant having “come to the trespass”. The subsection is also important (for reasons I will subsequently explain) in recognising a claimant’s “ownership” of the wrongly placed structure is not a barrier to relief.
[53] Section 325 sets out the orders the court may make. In the context of the relief sought by the plaintiffs, the relevant provisions are s 325(1), (e)-(f) and s 325(3).
325 Orders court may make
(1)In granting relief under section 323 on an application under section 322, the court may make 1 or more orders to the following effect:
…
(e)allowing or directing any person specified in the order to remove the whole or any specified part of a wrongly placed structure and any specified fixtures or chattels from any land specified in the order:
(f)requiring any person to whom relief is granted under paragraphs (a) to (e) to pay to any person specified in the order reasonable compensation as determined by the court.
…
(3)An order under subsection (1) may be made on any conditions the court thinks fit concerning—
(a)the execution of any instrument; or
(b)the doing of any other thing necessary to give effect to the order.
To what extent is “ownership” of the wall relevant?
[54] At the forefront of Mr Burton’s defence is the proposition that, to the extent the wall encroaches on the plaintiffs’ land, it is owned by them, precluding a claim in trespass (or inferentially) under the Act. Mr Kohler QC particularly emphasises the 1957 survey which identifies the wall as “generally on boundary” and says that, where it deviated into number 24, it became part of the Torrens title at that time issued for the property. He says that the owners of number 24 were thereafter either able to accept the accretion to their title or exercise the self-help remedy of removal. He adds the rider, however, that anyone exercising self-help remedies was subject to common
law obligations not to imperil the defendant’s house. This submission would effectively impose on them the costs of stabilisation and possibly reinstatement.
[55] I am unable to accept it. At common law, an action for trespass has never been precluded by the fact that the encroaching structure formed a part of the plaintiffs’ land at purchase. In Hudson v Nicholson, for example, the encroachment consisted of “nine shores and nine timbers” which supported the defendant’s neighbouring house.26 The supports had been installed before the plaintiff purchased the property. The timbers at least predated the defendant’s ownership.27 The plaintiff could not remove the supports without endangering the defendant’s house. As a result of the encroachment he was prevented from building his own home and accessory buildings as he had planned.
[56] The pleading was framed as an action on the case, for which the modern equivalent is a claim in nuisance. The defendant was held liable. On appeal, it was argued, firstly, that because the supports had been erected before the plaintiff had purchased his property, no claim was available and secondly, that any action should have been brought in trespass, not on the case.
[57]The appeal was dismissed. In his lead judgment, Lord Abinger CB held:28
The whole of this declaration shews that these timbers were put into the soil of the plaintiff for the purpose of supporting the defendant’s house and they were continued there by the defendant himself, rendering him substantially a trespasser, as much as if he had struck a pole in the land of the plaintiff. […] I think, therefore, that this is substantially a trespass. […] Then the only difficulty on this point is the writ of summons being described on the record as being in an action on the case. I am not, however, aware of any case in which this has been considered at all material; and I think a variance between the writ and declaration is no ground for arresting the judgment.
[58] Two essential principles emerge from the decision. Firstly, it does not matter that the defendant did not erect the structure. If he or she adopts or continues the trespass liability will arise, albeit the encroachment must first be brought to the
26 Hudson v Nicholson (1839) 5 M & W 437 (emphasis added).
27 It is unclear from the judgment whether the shores were placed on the plaintiffs’ land while the defendant owned the neighbouring property or beforehand.
28 At 189.
trespasser’s attention. That principle was more recently affirmed in Burton v Winter29 in which the defendants were found liable for an encroaching garage wall built by their predecessor in title. It also features in The American Law Institute Restatement of the Law of Torts (Second):30
A trespass may be committed by the continued presence on the land of a structure, chattel, or other thing which the actor’s predecessor in legal interest therein has tortiously placed there, if the actor, having acquired his legal interest in the thing with knowledge of such tortious conduct or having thereafter learned of it, fails to remove the thing.
[59]In New Zealand, it was also affirmed in Cousins v Wilson:31
The second contention made by the purchasers was that this was a continuing trespass and thus they became entitled to sue for continuing damage on taking possession. That the person obtaining possession is entitled to sue for continuing damage by trespass, though unable to sue for damage occurring before taking possession is plain enough. Thus, as exemplified, in two cases cited in the course of argument; Hudson v Nicholson (1839) 5 M & W 437, where timber was left on land and Konskier v B Goodman Ltd [1928] 1 KB 421where rubble was left on land, a later possessor was entitled to sue for the continuing injury arising after the date of possession.
[60] Secondly, it does not matter that the encroachment predates the plaintiffs’ purchase of their property, since the adoption/continuation of the encroachment represents an ongoing trespass. I accept the plaintiffs’ submission that this would not be the case on the argument Mr Kohler advances.
[61] In Harrow Burrough Council v Donohue the English Court of Appeal put the position clearly as follows:32
… in a situation such as the present where the landowners have been totally dispossessed by the defendant’s encroaching building, … the plaintiffs do indeed have an option. They may say, “Thank you very much” and accept the encroachment as an accretion to their land with which they are free to deal as they please; or they may take their remedy at court. If they follow the latter course, they are entitled as of right to one or other of two remedies; that is to say to an order for possession, or to a mandatory order for the taking down of the offending building.
29 Burton v Winter (1993) 1 WLR 1077 (CA).
30 The American Law Institute Restatement of the Law of Torts (Second) (1965) at § 161(2) (emphasis added).
31 Cousins v Wilson [1994] 1 NZLR 463 (HC).
32 Harrow Burrough Council v Donohue (1995) 1 EGLR 257 (CA).
[62] In my view such a principle equally applies whether the case involves a limited encroachment (as here) or a total disposession (as in Harrow). Nor, in my view, is the principle any different in the Torrens context. Although the wall can be regarded as an accretion to the title acquired on registration that cannot preclude a claim in trespass.
[63] These common law principles necessarily inform the position under the Act but ss 324(1)(c) and (2) in my view take the matter beyond argument. That is because both recognise that the plaintiffs’ acquisition of an estate or interest in the structure is not a barrier to relief if it was “wrongly placed”.
Are there claims in nuisance and trespass?
[64] The defendant argues that there is no trespass because the wall does not represent an “unjustified direct interference with land in the possession of another”.33 It bases that submission on the propositions, already rejected by me, that the structure is a party wall or alternatively that the plaintiffs’ “ownership” of at least parts of the structure precludes a cause of action in tort.
[65] It also says that there was no “positive voluntary act” as the tort requires, but I reject that argument also. The positive voluntary act was that of the defendant’s predecessor in title who caused his building platform to in part encroach on the adjoining property. Hudson v Nicholson and Burton v Winter both support the existence of an action in trespass on the factual findings I have made.
[66] I accept, however, the defendant’s submission that the trespass is limited only to those parts of the wall that are man-made and cannot extend to any natural rock outcrops which protrude into the access way. The plaintiffs do not contend otherwise.
[67] The plaintiffs also claim in nuisance. An actionable nuisance generally involves something offensive, be it noise, fumes or odours emanating from the defendant’s land and which wrongly and unreasonably affects the plaintiffs’ land. Closer to the facts of this case, it also captures failing retaining walls which then start
33 Stephen Todd (ed) The Law of Torts in New Zealand (7th ed: Thomson Reuters, Wellington, 2016) at [9.2.01].
to encroach over the relevant boundary,34 and cases involving tree roots which undermine adjacent structures.35 However, both such examples involve something emanating from the defendant’s land, whether it be retained soil or roots, which has then passed on to the plaintiffs’ property.
[68] As the plaintiffs themselves concede, the facts of this case fall more naturally within the tort of trespass. However, nothing particularly turns on the point. The plaintiffs assert the same facts and seek identical relief in respect of both causes of action.
Has the defendant adopted or continued the trespass?
[69] In Sedleigh-Denfield v O’Callaghan the Viscount Maugham defined the concepts of adoption and continuation within a nuisance context as follows:36
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.
[70] I consider that approach equally apposite to a claim in trespass, and in my view the defendant has clearly adopted/continued such trespass by using the wall to support his house and the retained land to the north and south of it.
[71] I also accept that he has been on notice of such encroachment since at least 2013 when the plaintiffs identified it and raised it with him.
Discretionary factors relevant to relief under the Act
[72] The defendant relies on two principle matters to say that it is neither “just” nor “equitable”37 for relief to be granted in respect of any wrongly placed structure identified by the Court. If that submission is not accepted, it says that the same matters are relevant to the nature of relief which should be granted. They are:
34 Bolton v Knight [1924] NZLR 1043.
35 For example, Delaware Mansions Ltd v Westminster City Council [2002] 1 AC 321.
36 Sedleigh-Denfield v O’Callaghan [1940] AC 880 (HL).
37 Adopting the words of s 323(2).
(a)That when the plaintiffs purchased number 24 in March 2012, reasonable inquiry would have identified that the physical driveway servicing the property was substantially off title, and thus identified the encroachment.
(b)That in seeking to establish a physical access coincident with their legal title (3.05 metres), the plaintiffs are endeavouring to maximise their development opportunities under the Terrace Housing and Apartment Building (THAB) Zone in the Auckland Unitary Plan (AUP) to an extent which significantly exceeds the opportunities available at the time of purchase.
[73] To assess the significance of these factors it is necessary to pick up the factual narrative again from the point of the plaintiffs’ first interest in the property.
[74] Both plaintiffs have architectural degrees. Ms Johnson practices as an architectural designer and Mr Graham as a registered architect. They have been in a relationship for some years. Both gave evidence that they had never previously acted as an owner/developer, although they did undertake some internal renovations at their previous home. Nevertheless, in purchasing number 24 they had in mind its development potential. This is consistent with the way in which the property was marketed by Bayley’s Real Estate. Indeed it used a “develop … or detonate” by-line to its materials describing their house as a:
very humble turn of the century homestead in almost original condition and allowing you to remove/demolish it with a clear conscience or, alternatively add to to create your dream home in the city.
[75] Accompanying photographs showed a run-down property on an overgrown section. The sale was described as an “estate liquidation” with the property being “offered to the market for the very first time”.
[76] At that stage the property was zoned residential 6A. A valuation, included within the Bayley’s marketing material identified that the highest and best use of the site was “for redevelopment with two new dwelling units in either freestanding or joined configuration that would best suit the varying land contours whilst maximising
western views”. Ms Johnson and Mr Graham considered, however, that a three- dwelling development may be possible.
[77] After purchase, their first thoughts were to move the existing house to the south east corner of the property, extend it and subdivide off a new site to the west. This would have required compliance with Part 11 — Subdivision of the City of Auckland District Plan. Under the Residential 6(b) zoning which applied at the time a “private- way” serving not more than three rear sites was required to have a minimum legal width and height of 3 metres and a minimum formation width of 2.4 metres.38 A further requirement was that “no building or part of a building shall encroach on or over the required legal width at less than the legal height”.
[78] These formative ideas were, however, placed on hold when the proposed Auckland Unitary Plan was published in September 2013 because this allowed for significantly greater intensification of the site. The Unitary Plan is now operative with the proposed THAB zoning confirmed and all appeals relevant to access now resolved.
[79]The THAB zone is described in s H6 of the Unitary Plan as follows:
The Residential – Terraced Housing and Apartment Buildings Zone is a high intensity zone enabling a greater intensity of development than previously provided for. This zone provides for urban residential living in the form of terraced housing and apartments. The zone is predominantly located around metropolitan, town and local centres and a public transport network to support the highest levels of intensification.
[80] The minimum size for new vacant lots in the THAB zone is 1200 square metres. The plaintiffs’ planning expert, Mr Campbell deposed that this is not to restrict the number of dwellings or units built in the zone, which in fact has no density restrictions. Rather, it is to ensure that sites within the zone are developed, are not cut up into smaller vacant sites and are the subject of integrated multi-dwelling developments. Number 24 Tawari Street is 1,029 square metres only with the result that it could not be subdivided without resource consent.
38 City of Auckland – District Plan Isthmus Section – operative 1999 (updated 28.10.2014) Part 11 paragraph 11.5.3.1A(a).
[81] Developments within the THAB zone are not subject to any parking or vehicular access requirements. Theoretically a multi-level, multi-unit development could occur with pedestrian only access to the street and public transport networks. However, in evidence which I accept, the plaintiffs consider that the topography of the site (which falls steeply to the west), coupled with the surrounding character of the neighbourhood, predicates a less intensive form of development comprising three or possibly four dwellings, two in a duplex configuration and with up to two detached town houses. In further evidence, which I accept, they say that for a development of this nature to be attractive to its potential market they would need to provide at least one off-street parking space or garage for each proposed dwelling.
[82] In terms of the now operative plan, this would require a minimum formed access with a width of 3 metres “provided it is contained within a corridor clear of buildings or parts of buildings with a minimum width of 3.5 metres”. Even if the property was to be redeveloped with one dwelling only, the minimum formed access requirements (in that case 2.5 metres within a minimum 3 metre corridor clear of buildings or parts of buildings) could not be satisfied. That is because, as I have already indicated, the base of the wall leaves an access way which for some distance is less than 2 metres (at one point reducing to 1.28 metres).
[83] Because of the “corridor” requirements in the plan and the fact that the wall is regarded as a building for plan purposes, the minimum requirements for a four dwelling/four car park development are unlikely to be satisfied, even if the wall was re-established with its western face on the boundary. That problem is compounded by the fact that the defendant’s house extends up to 7 centimetres into the access corridor. As a result, the plaintiffs’ planner, Mr Campbell, stated that a resource consent will still be necessary.
[84] In theory such consent might also be possible in respect of a four-unit, four car park development with a physical formation of less than 3 metres. Mr Campbell sensibly conceded as much on the basis of the Council’s stated aim of intensification within the THAB zone. He said that whether consent was granted for a narrower access way depended on whether the proposed design was acceptable in terms of traffic safety. However, stating what I consider to be the obvious, he also said the
greater the deviation from Council’s minimum requirement the less would be the prospect of obtaining resource consent. In that context, although the encroachment caused by Mr Burton’s house was one, in his opinion, able to be accommodated in a resource consent process, he considered it unlikely that the plaintiffs’ proposals would, for example, be acceptable with only a 2.4 metre driveway.
[85] My conclusion in relation to this evidence is that although the position cannot be stated with certainty, the plaintiffs’ prospects of undertaking a four-unit development on the site with carparking would indeed be much less favourable assuming a formed access width of 2.4 metres only, especially given the fact that the owners of number 26 could at any time build a fence down the western side of the access way reducing the “corridor” to the same 2.4 metres.
[86] Significantly also, even the plaintiffs’ current use and enjoyment of the property is materially restricted by the encroachment. That is because vehicular access is by grace and favour of number 26 and restricted to private vehicles only. Even to redevelop the site as a single dwelling (if permitted by Council) would be a substantially more onerous task with this limitation. I accept therefore that the encroachment has material consequences (actual and potential) for the plaintiffs. Importantly in the context of the conclusion I reach, the defendant did not call any planning evidence in opposition to Mr Campbell.
[87] And I consider Mr Quinn also fairly raises the point, why should the plaintiffs be forced to accept a physical access way narrower than their legal entitlements adding a significant further level of uncertainty to reasonable and sensible development proposals – in so doing effectively exonerating the encroachment? And why should the fact that their development opportunities have expanded since purchase be relevant in this respect? Absent good reasons the plaintiffs should in my view be entitled to maximise the lawful opportunities which Council’s zoning has provided.
[88] Mr Kohler says that one such reason is the fact that the plaintiffs should have identified the encroachment prior to their purchase. He put it to both Ms Johnson and Mr Graham, that as experienced professionals, they should have been alerted to the encroachment by the fact the physical access to number 24 deviated substantially to
the west, approximately half way down the driveway. He emphasised, in particular, an aerial photograph of the site which the plaintiffs accepted they had obtained prior to purchase and which showed the formed access way in parts significantly outside the surveyed boundary. In response, Ms Johnson said she had not appreciated that there was an encroachment at that stage and suggested that aerial photographs can distort perspective. Mr Graham in turn pointed out that at the top of the driveway there were two posts and a gate, creating the impression that the driveway was in its correct location when in fact it had deviated almost entirely off title at that point. Both he and Ms Johnson said that it was not until they had the property re-surveyed that they appreciated the problem created by the wall.
[89] I accept that a more vigorous review, even of the materials in their possession, would have alerted the plaintiffs to potential problems before purchase. However, likewise when Mr Burton was contemplating purchase of his property in the late 1970s he could have established its true boundaries. The somewhat precarious way in which his house sits directly on top of the edge of the wall, with one of its bearers lying on the rock fill, could even be considered circumstances which placed at a premium such inquiry. But no such inquiry was made.
[90] Overall, I regard these potential failures in due diligence as neutral between the plaintiffs and defendant. I am reinforced in that conclusion by the fact that, looking at the matter from a common law perspective, the plaintiffs would not be precluded from seeking relief simply on account of having “come to” the nuisance or trespass – that is, having been aware of it at the time of purchase. The position is the same under the Act, which specifically provides in s 324(2) that the court is not precluded from granting relief merely because the person seeking relief knew of the true boundaries or ownership of the land affected at the time of purchase. Where, as I accept occurred here, the purchase was made with no actual knowledge of the encroachment the position must be even stronger (whatever better inquiry may have revealed).
[91] Nor do I consider that there is anything in the conduct of the respective parties, after the plaintiffs’ purchase, which has particular relevance in terms of whether it would be just and equitable to grant relief.
[92] The plaintiffs identified the encroachment in 2013. It was raised with Mr Burton. The correspondence indicates increasing frustration on their part that, for some months after purchase, Mr Burton had retained scaffolding against the wall seemingly to allow basic maintenance. For his part Mr Burton was concerned about possible effects on his house from construction of a service trench down the western side of the access way. He considered the establishment of such services premature and designed deliberately to provoke him. The plaintiffs in turn considered that by laying concrete under his enclosed veranda (directly on to the rock fill behind the wall) and in the annex Mr Burton was attempting to entrench his position.
[93] As the plaintiffs became more frustrated with the absence of a solution to the encroachment issue they raised with counsel whether Mr Burton’s house was structurally sound. They considered that they had a professional obligation to do so because of their concerns about possible collapse. However, the Council did not share their concerns. Understandably, Mr Burton took umbrage at these developments. Repeated further requests to address the issue were, on my view of the evidence, stonewalled.
[94] Overall, I do not consider there to be anything in the plaintiffs’ conduct which disqualifies them from relief. The record indicates that they reasonably and appropriately raised the encroachment with Mr Burton and pressed their case. They reasonably explored other alternatives to proceedings, including a boundary adjustment which would have involved them selling a portion of land to Mr Burton and, in turn, acquiring additional land from the owners of number 26, but such owners were not persuaded. They have, throughout the dispute, taken the reasonable position that the 7 centimetre encroachment by Mr Burton’s house does not need to be removed. It is in precisely these circumstances where, as the Court of Appeal said in Guo v Bourke, “neighbours are unable to resolve disputes that have arisen”,39 that the statutory jurisdiction is engaged.
[95] Nor do I consider the fact that the plaintiffs developed a 2013 proposal involving a new concrete wall between numbers 22 and 24 with an inside face on the
39 Guo v Bourke [2017] NZCA 609 at [12].
boundary and with a batter to a base 2.6 metres from the western boundary of the access way, precludes them from now seeking a solution involving no encroachment at all. That proposal was advanced in the period July/August 2013 before publication of the proposed unitary plan. As I have indicated, I do not consider the plaintiffs should be required to compromise (or at least imperil) reasonable development opportunities that have arisen since purchase in order to provide continued accommodation of what is a wrongly placed structure. At common law they could have sought abatement of the trespass by way of mandatory injunction and, in my view, it is unlikely any discretionary factors would have weighed against such relief. In lieu, damages would have been an available remedy. The consequences of the encroachment are (unlike some of the de minimis cases) real and substantial. In my view there is nothing unjust or inequitable about requiring or allowing the full extent of the encroachment to be removed. However, by whom, involving what methodology and with what ultimate result represents the more difficult question. It is to those issues I now turn.
Remedy
[96] The plaintiffs advance a series of alternative remedies to which they may be entitled. These range from a simple order that the defendant remove the encroachment within a fixed date (the plaintiffs suggest 12 months), through options which have the defendant required to undertake stabilisation works in the course of removal (either of an unspecified nature or in accordance with the methodology developed in evidence by their expert structural engineer, Mr Wood), to what is their preferred option, namely, that they be permitted to undertake the work themselves at the cost largely of the defendant.
[97] They describe a direction to the defendant to remove the encroachment as being the Court’s “conventional relief”. I accept that is so. However, they suggest that in this case the Court should go further because if the defendant is left to develop its own methodology, which Mr Burton may be inclined to do without professional assistance, there exists a high risk that his house will collapse into the access way.
[98] The methodology adopted by Mr Wood involves temporary support to (and in part removal and reconstruction of) the house and the construction of a new reinforced concrete retaining wall. He divides the western wall of the house into three zones: the first (Zone A) corresponding to the enclosed veranda, the second (Zone B) to the living/dining room immediately to the south and the third (Zone C) comprising the annex washroom at the rear of the house.
[99] In Zone A, his methodology calls for the veranda roof and walls to be temporarily removed and the concrete subfloor, recently laid by the defendant, to be cut back. This creates room in the order of 1.2 to 1.5 metres, behind the property boundary so that the encroaching stone work can be removed. Then a new retaining wall can be built and back filled. Finally, the concrete floor, walls and roof of the veranda can be reinstated.
[100] In Zone B, he proposes that a temporary steel beam be fixed along the face of the living/dining room wall, which would be supported by props. This would allow rocks below the house to be removed and the replacement wall to be built in the same way as in Zone A. Once the new retaining wall was in place, the temporary support could be removed and the outer wall of the living/dining room left to rest on top of the new retaining wall.
[101] In Zone C, he proposes that the western wall and edge of the roof be removed, again to provide sufficient clearance for removal of the encroachment. Again the remaining portion of the roof would be supported with temporary timber props pending construction of the new wall and subsequent replacement of the Zone C floor and wall.
[102] On the basis that the new retaining wall runs the full length of the access way, (that is beyond the defendant’s house to the street frontage), the plaintiffs’ quantity surveyor estimates a total cost of $421,379.55 including GST, Council consent fees, professional fees40 and a contingency allowance of 20 per cent.
40 $46,500 plus GST.
[103] Evidence was also given by an experienced engineering contractor, Mr T Donnelly, who estimated the cost of the works at $255,370.15. However, this sum excluded consent and professional fees and the quantity surveyor’s proposed contingency allowance which, if included on a like for like basis, would take his estimate to $371,419.18 GST inclusive.
[104] Some reduction in these costs could be anticipated if the new retaining wall did not extend northward from the corner of the defendant’s house to the road or southward to the end of the access way. The amount of such deduction is not identified in the evidence.
[105]In relation to these estimates the plaintiffs propose that:
(a)if they be permitted to undertake the works at the defendant’s cost, the defendant’s liability be capped at the amount of their quantity surveyor’s estimate less the reductions referred to below;
(b)there be a deduction of $20,000 (inc GST), against their quantity surveyor’s estimate of $14,283 (inc GST), to take account of the costs of removal of natural basalt features for which the defendant is not responsible;
(c)the sum of $25,000 (inc GST) be deducted, against their estimate of
$22,300 (inc GST), to reflect the fact that the foundations for the boundary wall can also serve as a concrete driveway to access their property; and
(d)in the event they be permitted to build a new wall the full length of the access way, that they make a contribution (to be determined by the Court) to recognise the “aesthetic benefits” available to them and the “peace of mind” in having “a new properly engineered vertical wall along the length of their driveway”.
[106] The defendant says it will remedy the trespass if required. However, it says that neither under the Act nor at common law can the Court grant the plaintiffs their preferred remedy – and that if it can, it should, as a matter of discretion, nevertheless not do so.
[107] Referring to the plaintiffs’ proposed methodology, Mr Burton said that he found it “unthinkable to think about what the consequences would be for me. Certainly, apart from whether I would be able to continue to live in my home, it would have a very significant effect upon my retirement”.
[108] To the extent that that was an attempt to influence the Court in the exercise of its discretion I consider it unsuccessful. As the cross-examination demonstrated, Mr Burton is a wealthy man, with diverse property interests and a net equity of at least
$12 million but probably significantly more. He has multiple options for temporary accommodation if required,41 even recognising, as I do, that he has a disability.42 Although I accept that he may not immediately have available the cash resources to undertake the work proposed by Mr Woods, the plaintiffs’ suggested time period for completion would allow him comfortably to realise one of his many assets. Likewise, if he considered the deteriorated condition of his house and the development potential of his now re-zoned property were such that the plaintiffs’ proposals were uneconomic, he would have adequate opportunity to explore his further options within the time period.
[109] I turn then to consider what remedies are available to the Court and what orders the Court should in my view appropriately make.
[110] Clearly the Court has power under s 325(1)(e) to direct the defendant to remove the wrongly placed structure. Consistent with my previous findings, such an order would require removal of all man-made material located between the face of the wall and the boundary line of the properties, with no obligation on the defendant to remove the wall’s natural basalt footing where such exists, or any other natural basalt
41 It may not be required – the enclosed veranda (which appears to be used for storage and not to be lived in) and the living/dining room would be fully supported during the works. Some temporary bathroom arrangements may, however, be necessary.
42 Mr Burton is confined to a wheel chair after a work place accident approximately 30 years ago.
outcrops or formations located at or above the level of the access way. Ancillary orders requiring the plaintiffs to permit the defendant to have reasonable access to their property for the purposes of the works and requiring the defendant to give reasonable advance notice would, in that context, be necessary. Implicit in the order would be the assumption that the costs of the removal works were to be borne by the defendant.
[111] Such a remedy has the advantage of allowing the defendant an opportunity to consider the economics of preserving the existing dwelling and, if it considers that to be appropriate, to develop a potentially less expensive methodology than that advanced by the plaintiffs. In the absence of the house it may be possible, for example, simply to create a new rock batter (with or without “shotcrete” stabilisation) entirely within boundary. Likewise, part of the house could be removed or, as the plaintiffs acknowledge, it could be temporarily propped pending later redevelopment of the site. Alternatively, the defendant could opt for Mr Wood’s methodology or something close to it.
[112] From the plaintiffs’ perspective, the apprehended problem is that if the Court does no more than require the encroachment to be removed it runs the risk of what Mr Quinn calls a “disaster” unfolding on the boundary. He said that would inevitably result in fresh proceedings before the Court and probably in acute circumstances.
[113] At common law, where the Court has considered it necessary to prevent repeat trespasses or nuisances or anticipated future trespasses or nuisances, it has “sparingly” recognised a jurisdiction to specify that certain works take place.43 In Redland Bricks Ltd v Morris, the House of Lords emphasised that any such order should identify, with as much particularity as possible, what is required to be done.
[114] In my view the direction which the Court can give under s 325(1)(e) of the Act to remove a wrongly placed structure could properly include a direction as to methodology, even without the expanded jurisdiction in s 325(3) permitting conditions “necessary to give effect to the order”. Mr Kohler argues, however, that when stipulating any such methodology the Court could certainly not go as far as to require
43 Kennard v Cory Brothers & Co Ltd [1922] 2 CH1 per Scrutton LJ at 20-21; Redland Bricks Ltd v Morris [1970] AC 652 per Lord Upjohn at 667.
construction of a new reinforced concrete wall. He contrasts conditions necessary to give effect to an order with those that expand the nature of the order and emphasises that the critical word in subs 325(1)(e) is “remove”.
[115] However, such approach seems inconsistent with that adopted by the Court of Appeal in Guo.44 It emphasised the availability of relief where it is “just and equitable” and the fact that under pt 6 orders could “generally” be “made on such terms and conditions as the Court thinks fit”. In so doing it expanded the “conditions” referred to in s 325(3) to include “terms and conditions” and adopted a generous interpretation of what terms and conditions may be necessary to “give effect to the order”.45
[116] In the present case I do not consider it necessary to express a final opinion on these points. That is because, Mr Wood’s methodology is, as I have indicated, only one of several options available to the defendant. In those circumstances it would not, in my view, be appropriate to mandate his approach. But equally, in my view, it must be open to the Court to ensure that the “removal’ methodology does not cause an ongoing nuisance or trespass or the risk of disastrous collapse. From a practical perspective this tension can be adequately resolved by requiring removal, either in accordance with the methodology developed by Mr Wood (including his proposals to ensure long-term stability of the building platform) or such other methodology as may be approved by a registered structural and geotechnical engineer and tabled with the Court within an identified period. Then, if Mr Burton chooses to adopt a solution consistent with the ultimate redevelopment of his site, he is free to do so. If, on the other hand, he chooses to embrace either generally or specifically Mr Wood’s methodology, then the Court could ensure an opportunity to seek a contribution from the plaintiffs reflecting the various factors they themselves identify. The remedy in that context would be both the pragmatic and flexible.
44 Guo v Bourke [2017] NZCA 60.
45 The decision itself reflects such an approach. It authorised Ms Guo to remove the offending gates on the condition that she granted an easement to the defendant. On a strict construction, it was not necessary to grant the easement in order to give effect to the removal order but such represented both a “pragmatic” and principled result. At [12].
[117] As to the plaintiffs’ proposed alternative remedy, the Court clearly has jurisdiction under s 325(1)(e) to make orders permitting the plaintiffs and their contractors to remove such parts of the wall as encroach on their property. The difficulty arises, however, in respect of the proposed additional relief directing the defendant to bear the costs of removal (and any costs of any reinstatement or replacement to the extent such may be necessary). For obvious reasons, the plaintiffs have no interest in one order without the other.
[118] I do not consider that the Court has jurisdiction under the Act to grant additional relief of this nature. Subsection 3 does not assist, for what I consider to be two reasons.46
[119] Firstly, it recognises the ability to make orders “on any conditions”. The concept of an order allowing a plaintiff to do something on the condition that the defendant meets the costs of so doing is an awkward one. Typically, the conditions a Court might impose would represent a qualification to the permission, not a source of additional rights. Nor does a construction of conditions to include “terms and conditions” fully alleviate that problem.
[120] Secondly, the conditions relevantly permitted by the subsection are, in their terms, those “necessary to give effect to the order”. Even allowing for a pragmatically generous interpretation of those words, it is difficult to see how the plaintiffs’ proposals for reinstatement with a fully engineered reinforced concrete wall are “necessary” to give effect to an order allowing them to remove the encroachment. As Mr Quinn candidly acknowledges, there are other, probably significantly less expensive options which would be sufficient to secure the house.47
[121] Mr Quinn relies on s 325(1)(f), in terms of which the Court may make orders “requiring any person to whom relief is granted under subparas (a)-(e) to pay any persons specified in the order reasonable compensation as determined by the Court”. He submits that, in this case, s 325(1)(f) would permit cost sharing “in either direction”
46 I note that the plaintiffs do not in fact rely on the subsection. Their argument is based on s 325(1)(f).
47 Indeed, he did not actually advance an argument under subs 3.
since “the Court’s orders will grant relief to both plaintiffs and defendant and both parties will inevitably be named in the order”. He further submits, and I accept, that the relief granted to the plaintiff is relief from the encroachment. However, more controversially, he suggests that, in the defendant’s case, the relief would be “from what would otherwise be the consequences at common law”.
[122] However, only persons to whom relief is granted under subparas (a)-(e) may be required to pay compensation. The suggested relief from common law consequences is not a relief within those categories. Nor is the word “compensation” apt to describe the payment that is proposed in favour of the plaintiffs.
[123] Nevertheless, as s 323(4) recognises, relief under the Act does not exclude any claim to damages a person might otherwise have.48 And it is possible that a Court could combine an order under the Act allowing a plaintiff to remove a wrongly placed structure and a damages award at common law for the costs of abatement of a proven nuisance or trespass.49
[124] In my view, however, relief involving a combination of orders under s 325(1)(e) and damages for the costs of removal and reinstatement is not (at least at this stage) appropriately given.
[125] For a start, it would involve a remedy beyond the existing pleadings since the only damages award sought in the statement of claim is “equitable damages in lieu of an injunction … representing the diminution in value of the plaintiffs’ property”. More fundamentally, however, it would lock the defendant into a scheme of works which would be undertaken (at least substantially) at its cost and which may be excessive having regard to the condition of the existing house and the redevelopment potential
48 Such an award must nevertheless take into account any relief granted under the Act (see s 325(5)).
49 Delaware Mansions v Westminster City Council [2002] 1 AC 321(HL). Australian courts have been more reluctant to recognise the right to recover the costs of abatement as damages (see Young v Wheeler (1987) Aust Tort Reports 80; Proprietors of Strata Plan No 14198 v Cowell [1989] 24 NSWLR (SC) 478 and Richmond City v Scantelbury [1991] 2 VR 38). However, their willingness to allow recovery of equivalent costs as “a reasonable step taken in mitigation of damages” (See Proprietors of Strata Plan No 14198 at 486(f)) has meant that, in practical terms, little has turned on the point. Moreover, in Richmond City, the Supreme Court of Victoria also recognised that irrecoverability of the costs of abatement only applied to costs incurred before commencement of action and did not preclude compensation by way of damages for costs to be incurred in the future.
of the defendant’s site. In circumstances where, absent the house, a new batter could be established entirely within the defendant’s title the Court should, in my view, be reluctant to impose its (or the plaintiffs’) vision of what is an appropriate method to remove the encroachment.
[126] In terms of the discretion I am required to exercise under s 325, there is, I consider, a preferable course which at first instance leaves the methodology to be settled by the defendant. In coming to that conclusion I am influenced by Mr Burton’s commitment (through counsel) to “remedy the trespass if required”. However, in my view, it would also be appropriate to reserve to the plaintiffs leave to seek alternative relief (in addition to any other remedies which might be available to them) if that commitment and the Court’s associated orders are not adhered to.
[127] In a case such as this, where reluctantly the Court has to accept the inevitability of some supervisory role, and where all possible contingencies associated with the removal of the encroachment cannot be accurately foreshadowed, I consider it also prudent to reserve leave to the parties to apply for any ancillary orders and directions which may be considered necessary. Clearly, however, that is not an invitation to revisit any of the judgment’s essential findings and conclusions.
Result
[128] I grant the following relief. In doing so I define the word “encroachment” to mean all that portion of the man-made structure separating numbers 22 and 24 Tawari Street, Mt Eden, which retains material behind it,50 including all material of whatever nature located between the western face of the structure and the boundary line, but with no obligation on the part of the defendant to remove the natural basalt footing of the structure (where such exists) or any other natural basalt outcrops or formations located at or above the level of the access way on number 24.
(a)An order declaring the encroachment to be a wrongly placed structure for the purposes of pt 6 sub-pt (2) of the Property Law Act 2007.
50 Corresponding generally to where it sits beneath the western exterior wall of the house located on number 22. No order is sought in respect of the “freestanding” wall at the southern end of the boundary. The plaintiffs can in due course either relocate that onto the boundary or remove it.
(b)An order directing the defendant to remove the encroachment by 31 March 2020 and in so doing to carry out such further stabilisation works (either in accordance generally with the methodology identified by the plaintiffs’ expert, Mr G N Wood, and appended to his brief of evidence dated February 2019 as Schedule A or in accordance with such other methodology as is approved by a registered structural and geotechnical engineer and is tabled with the Court by 20 July 2019), such order being with the purpose and effect of ensuring that neither the house located at number 22 Tawari Street, nor any part of the land on which it is situated, will collapse or slip on to the plaintiffs’ property.
(c)An order that the plaintiffs permit the defendant to have reasonable access to their property for the purposes of carrying out of the removal and any further stabilisation works.
(d)An order that the defendant give reasonable advance notice to the plaintiffs of the date of commencement of the works and expected duration.
(e)An order that the costs of the removal and stabilisation works be borne by the defendant.
(f)In the event the defendant adopts Mr Woods’ methodology, or like methodology involving construction of a new reinforced concrete wall with western face on the boundary of numbers 22 and 24 Tawari Street, I reserve leave to the defendant to apply for further orders recognising any or all of:
(i)the costs of removal of any natural basalt outcrops or formations;
(ii)betterment accruing to the plaintiffs (either generally or in terms of driveway establishment).
(g)An order that the plaintiffs grant to the defendant an easement to accommodate the foundations of any new retaining wall – such easement to include an obligation on the defendant and its successors in title to maintain the wall and its foundations and a right of access to the defendant and its successors for such purposes.
(h)An order granting leave to the parties to apply for ancillary relief in accordance with para [127] hereof.
(i)In the event of noncompliance with order (b) hereof, and without derogating from any other rights or remedies available to them, I grant leave to the plaintiffs to apply for such alternative relief as specified by them in writing to the defendant’s solicitors a minimum of 14 days prior to application.
Costs
[129] The plaintiffs have succeeded in terms of the first alternative relief pleaded in their first cause of action. They are entitled to costs. Provisionally, I consider those appropriately assessed on a 2B basis.51
[130] Absent agreement between counsel (which is my expectation) brief memoranda (maximum five pages) may be filed and served on the following timetable:
(a)by the plaintiffs in support by 22 April 2019;
(b)by the defendant in opposition by 13 May 2019; and
(c)by the plaintiffs in reply 20 May 2019.
Muir J
51 This assumes the absence of any particular considerations of which I am currently unaware.
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