SF Nominees Limited v Ballan

[2014] NZHC 2977

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2013-404-003396 [2014] NZHC 2977

BETWEEN

SF NOMINEES LIMITED

Plaintiff

AND

BYRON LEONARD CHARLES BALLAN

First Defendant

JANE MARGARET PHARE Second Defendant

AND

MASONRY DESIGN SOLUTIONS LIMITED

First Third Party/Applicant

MARK INNES WILSON Second Third Party/Applicant

Hearing:	26 November 2014
Appearances:	J T Turner and N C Baier for Third Parties/Applicant S Nicolson for Defendants/Respondents
Judgment:	26 November 2014

ORAL JUDGMENT OF VENNING J

Solicitors:           Spencer Legal, Auckland McVeagh Fleming, Auckland Lowndes Jordan, Auckland

Copy to:            A Holmes, Auckland

SF NOMINEES LTD v BALLAN [2014] NZHC 2977 [26 November 2014]

[1]      This case has a fixture scheduled for 16 February next year.   The close of pleadings date has passed.

[2]      The first and second third parties have applied for orders for inspection and testing pursuant to r 9.34 and for further and better discovery against the defendants.

[3]      The background to the proceeding is an easement boundary dispute between the plaintiff and defendants who own neighbouring properties.  The plaintiff claims the defendants are obliged to execute an easement in their favour.  The defendants says that certain garden retaining walls built by the third parties for the defendants on their land on the instructions of the plaintiff are defective.  It is pleaded that the design and construction are inadequate.  There is both an upper and a lower footing wall in issue.  In response to the defendants’ counterclaim the plaintiff has joined the third parties.

[4]      The defendants have extracted two  posts from  the retaining walls at the northern end of the retaining wall.  They say that those posts are supportive of the allegations of insufficient workmanship in the construction or design defaults by the third parties in that they are in short, insufficiently seated.  The defendants consider them to be representative of all posts in the upper and lower retaining walls.

[5]      The third parties do not accept that the posts are representative.  They note that the topography of the property is such that the southern end of the walls are at a higher level and  that if posts were extracted  from the southern end  that would disclose that the work had been properly designed and carried  out by the third defendants, in other words they want to test the defendants’ position that the posts that have currently been extracted are representative of the entire wall.

[6]      The third parties seek orders under r 9.34 enabling them to extract posts from the middle of the upper wall to the southern end of the upper wall and to the middle and southern end of the lower retaining wall – four posts in total.

[7]      The parties have had some discussions regarding the matter but have been unable to agree on the basis upon which this investigative work could be carried out.

The defendants are particularly concerned about two issues, first potential liability to the plaintiffs of any consequential damage to the plaintiff’s property;  and secondly, damage to the defendants’ own property.   It is proposed that the posts would be extracted by a digger being taken on site, digging along what is referred to as the void, and then by the use of pincers on the digger removing posts from the middle and far southern end of the wall.

[8]      The contractor initially engaged by the defendant has sworn an affidavit in which he deposes that he is aware of the land in question and that the digger would not cause the bank above the void to collapse.   He says he would also batter any spoil onto the edge of the bank to help prevent any issues that may arise.   The defendants do not accept the assurances provided.

[9]      The plaintiff’s  position  as  advised  by Mr Holmes  is  that  they abide  the decision of the Court but would want their position to be protected in the event that their property suffers any consequential damage as a result of any such inspection work.

[10]     Having heard from counsel I accept that the issue of the placement of these posts will be an important, if not fundamental issue, in resolving the merits of the claim against the third parties.  Although the third parties have left it very late in the piece to make this application that is not a reason itself to deny the ability to rely on r 9.34.

[11]     Mr Turner made something of the fact the third parties have only been joined for a limited period of time.   Notwithstanding that they have been party to the proceedings for some time. The fixture has been allocated for some time. All parties have been aware of the fixture, so that this application has been made very late in the piece.  Nevertheless having heard from counsel and having considered the affidavits before the Court addressing the issue I am as I say satisfied that the interests of justice and a fair hearing support the application by the third parties for an order for inspection.  However, the proposed work is particularly invasive of the defendants’ property and there is potential, despite the best care that will be taken, for damage to that property. Those issues needed to be addressed.

[12]     In my view it is necessary for there to be some compromise to address that. For those reasons I consider that the appropriate order is to restrict the number of posts to be removed to two – one from the upper wall;  one from the lower retaining wall.  It would seem logical for those to be taken from towards the southern end of the property given the topography of the property and the point of the exercise.

[13]    The defendants are also entitled to some security in the event that the unexpected occurs and that there is slippage on their property.  The plaintiffs are also entitled to some security in the event of damage to their property.

[14]     For those reasons I make the following orders:

(a)      The defendants or either defendant on reasonable notice are to permit the third parties and their representatives and agents to enter on to the defendant’s land at 491 Riddell Road, Glendowie:

(i)       to inspect and test two garden retaining walls;

(ii)to extract one post from each of the two walls, being the lower footing wall and the upper footing wall towards the southern end of those walls;

(iii)to inspect and test the holes from which the posts have been extracted, the posts, and the concrete encasing;  and

(iv)     at the defendant’s option to reinstate or refix those extracted

posts or backfill

in all instances at the third parties’ cost and expense.

(b)      The orders are made on the following conditions:

(i)the third parties before uplifting this order and giving effect to it are to pay to the Registrar of the Court the sum of $7,500 to be held by the Registrar in an interest bearing account, with

such sum together with any accrued interest to be released by written authority of the parties or further Court order or as may be determined on the written advice of an independent registered engineer having inspected the land and being satisfied on reasonable grounds that there has been no or insignificant damage or loss to the area west of the red marked ridge line on the bank as depicted on exhibit B to the affidavit of Byron Ballan dated 26 November 2014 as a result of the works of the third parties or their contractors.

(ii)before uplifting the order the third parties are also to file an undertaking confirming that they undertake to be responsible for the payment of any damages that may be sustained by the plaintiff’s property as a direct result of such inspection work authorised by the above order.

(c)       I reserve leave for the parties to seek any further orders that may be necessary to give effect to the above orders.

Costs

[15]     The third party applicants have succeeded in this application.  However, as noted,  the  application  has  been  brought  late.    It  required  leave  which  was  not formally sought initially.  They have not pursued the application for discovery.  In the circumstances costs on the application for inspection and testing and discovery are to lie where they fall.

[16]     The orders have been made in anticipation the work will be able to be carried out promptly and in sufficient time to enable the fixture for 16 February 2015 to be maintained.  If any difficulties arise in that regard the matter is to be relisted before me as the List Judge.   I make it clear that I expect the work to be carried out in sufficient time to enable that fixture to be maintained.

[17]     To enable that to occur, in other words to have everything completed and in place so that the fixture is maintained, the time for the third parties to exchange the witness statements is extended to Friday, 12 December 2014.

[18]     I record the plaintiff is currently in default of the requirement to exchange its witness statements.  The time for it to exchange its witness statements is extended to Monday, 1 December 2014.  If it seeks any further extension on that then a formal

application will be required.

Venning J