Simunac v Lu
[2024] NZHC 363
•28 February 2024
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2022-404-1867
[2024] NZHC 363
BETWEEN MARKO SIMUNAC and MAJA VISNIC SIMUNAC
PlaintiffsAND
JIEYU LU
First Defendant
NEW ZEALAND WALKING ACCESS COMMISSION
Second Defendant
AUCKLAND COUNCIL, TE
KAUNIHERA O TAMAKI MAKAURAUThird Defendant
Hearing: 7 February 2024 Appearances:
A J Sherlock and A L Stuart for Plaintiffs
M D Pascariu and J C Murdoch for First Defendant L M Hansen for Second Defendant
No appearance for Third Defendant (abiding the decision of the Court)
Judgment:
28 February 2024
JUDGMENT OF O’GORMAN J
This judgment was delivered by me on 28 February 2024 at 4.30 pm pursuant to r 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Solicitors/Counsel:
Hesketh Henry, Auckland
Hamilton Locke (NZ) Ltd, Hamilton Maxwell Law, Wellington
L M Hansen, Barrister, Wellington J E Atkin, Auckland Council
SIMUNAC v LU [2024] NZHC 363 [28 February 2024]
[1] This is an application for an interim injunction seeking to prevent the registration of an easement pending the hearing of the substantive proceeding scheduled to take place in February 2025. The plaintiffs, Mr and Mrs Simunac, own the property at 112 Golf Road, Matakana (Simunac property). The first defendant, Ms Lu, has ownership interests in three properties at 494, 568 and 570 Matakana Road. Together, these comprise the Matakana Estate winery, lodge and vineyard. The property at 494 Matakana Road (Lu property) neighbours the Simunac property to the north. Ms Lu is the sole owner of the Lu property.
[2] As part of the acquisition of the Matakana Estate winery, lodge and vineyard, Ms Lu sought and obtained retrospective consent to the acquisition from the Overseas Investment Office (OIO).1 One of the conditions of the OIO was for Ms Lu to grant an easement to the second defendant, the New Zealand Walking Access Commission (WAC), for the establishment of a walking and cycling trail (walking trail) over the property, to be registered by a deadline of 30 June 2024. The intention is that this walking trail will be funded by the third defendant, Auckland Council. The easement that the first and second defendants seek to register to comply with this condition passes directly over the land subject to an existing right of way easement (ROW easement) on the property on the northern border of the Simunac property. The ROW easement provides driveway access to the Simunac property, which would otherwise be landlocked.
[3] The Simunacs are concerned that the walking trail easement will harm their interests under the ROW easement and that use of the walking trail will constitute a public nuisance and private nuisance. Among other things, they say it will significantly increase the risk of spreading kauri dieback disease, it will impede access for the Simunacs, and present a health and safety risk due to the limited width of the existing driveway access (only wide enough for one car). It will also increase the plaintiffs’ cost of maintaining the driveway and surrounding areas, reduce their privacy, increase noise, and adversely affect the value of their property.
1 Huang v Chen [2022] NZHC 1888 at [94].
[4] The Simunacs were not aware of the proposed walking trail easement until 9 July 2021. From early 2022, the Simunacs engaged with the defendants seeking to discuss their concerns and find a solution. This proceeding was commenced in September 2022 when no satisfactory solution was found.
[5] On 23 September 2022 the Simunacs filed an application for an interim injunction, seeking to maintain the status quo pending determination of the substantive proceeding. That application was put on hold when the second defendant gave an undertaking not to register the walking trail easement without giving four weeks’ advance notice. At the case management conference on 31 October 2023, the Simunacs sought to extend this position. However, the first and second defendants did not agree and instead proposed a substituted undertaking not to make the walking trail operational under the Walking Access Act 2008 or to take any steps to commence construction until these proceedings are determined. The first and second defendants seek to proceed with registration of the easement, given the OIO deadline of 30 June 2024, but contend that this has no practical detrimental impact if the works do not proceed pending determination of the substantive issues.
[6] In the context of this interim injunction application, the key issue is the impact of registration of the walking trail easement, and whether this might prejudice the plaintiffs’ ability to obtain relief in the substantive proceeding.
Pleadings and interim application
[7] The first claim in this proceeding was dated 23 September 2022. That pleaded three causes of action:
(a)Non-derogation of the grant: The first cause of action alleged that the walking trail easement would create a substantial interference to the ROW easement and the plaintiffs’ ability to access the Simunac property. Under this cause of action, the plaintiffs sought an interim injunction restraining the defendants from registering the walking trail easement and a declaration that the proposed walking trail easement was a derogation of the grant of the easement and therefore unlawful.
(b)Public nuisance: The second cause of action was for public nuisance, based on an allegation that the walking trail presented a significantly increased risk of spreading kauri dieback disease to the kauri trees situated on the Lu property. Any such spread of kauri dieback would result in a loss of amenity to Mr and Mrs Simunac but would also endanger the trees in the surrounding community and have other negative consequences for the wider community.
(c)Private nuisance: The third cause of action was one of private nuisance, alleging that the grant of the walking trail easement and consequent construction of it would present an unreasonable interference with their quiet use and enjoyment of the land.
[8] As recorded in the Court minute of 14 November 2022, Ms Lu sought a stay on the basis that the first cause of action was required to be submitted to alternative dispute resolution (arbitration).2 In response to that position, the plaintiffs filed an amended claim dated 13 February 2023 which removed the cause of action for non-derogation from the grant.3
[9] The statement of defence filed by Ms Lu takes the position that she is under a statutory obligation under s 25A of the Overseas Investment Act 2005 (OIA) to grant the walking trail easement, given that the retrospective OIA consent includes a condition that this must be done by 30 June 2024. She denies that the proposed walking trail will cause any infringement of any public or private right or cause any unreasonable interference with the plaintiffs’ quiet use and enjoyment of the Simunac property. In any event, such interference could be prevented by conditions and mitigation measures or compensated by an award of damages. Ms Lu pleads an affirmative defence that she is under a statutory obligation to grant the walking trail easement, and that statutory obligation carries with it immunity from liability for any nuisance arising as an inevitable consequence of carrying out the authorised activity, being walking and cycling.
2 Land Transfer Act 1972, s 90D; Land Transfer Regulations 2002, r 10 and sch 4, cl 14; Land Transfer Regulations 2018, sch 5, cl 14; and Hill v Elimelech [2018] NZHC 449, [2018] 3 NZLR 364 at [44].
3 Simunac v Lu [2023] NZHC 335 at [11].
[10] WAC takes a similar position in its own statement of defence. It admits that part of the walking trail will cross the ROW easement in favour of the Simunac property. It denies that any public or private nuisance will be caused by the walking trail, and states that any potential issues arising from use by pedestrians and cyclists could be mitigated with privacy screening, fencing, tree planting, and other measures. It also pleads an affirmative statutory authority/immunity defence that the obligation on the first respondent to grant the walking trail easement has been specifically authorised under the OIA, and that obligation is within the powers conferred under that Act.
[11] The relief sought in the statement of claim under each cause of action is an interim injunction to prevent the defendants from registering an easement on the Lu property for the walking trail, and a permanent injunction preventing the registration of that walking trail easement and the construction of the walking trail along the driveway and the boundary between the two properties.
[12] The amended interlocutory application seeking the interim injunction sets out the plaintiffs’ position as follows:
(a)There is a serious question to be tried as to whether the walking trail easement constitutes a nuisance.
(b)The balance of convenience lies in favour of the plaintiffs:
(i)The right of way is the only access to the Simunac property.
(ii)Once the walking trail easement is registered on the title of the Lu property, the plaintiffs will have no or extremely limited ability to remove it.
(iii)The proposed walking trail easement has already caused a loss in value to the Simunac land. If the walking trail easement is registered, further loss of value to the plaintiffs will be suffered.
(iv)There are many hurdles yet to be overcome before the walking trail can be constructed or used. There will be no loss of public amenity or delay if the interim injunction is granted.
(v)There are several contingencies which could affect or prevent the construction of the walking trail including lack of funding, engineering issues, and inability to obtain resource consent. In the meantime, the walking trail easement will adversely affect the value and enjoyment of the plaintiffs’ land.
(vi)Ms Lu has until June 2024 to comply with the OIO condition or to seek an extension. Mr Lu’s failure to seek an extension counts against her.
[13] The plaintiffs have filed an affidavit of Mr Hook in support of the interlocutory application which addresses the issue of environmental effects and explains that a land use consent will be required as a discretionary activity, because the proposed walking/cycling trail runs through a “Significant Ecological Area”.
[14] The plaintiffs have also filed an affidavit of Mr Sprague, a registered valuer, in which he assesses the current market valuation of the Simunac property “as is”, compared with the value on the basis that the proposed easement and public walkway is registered. He assesses a market value of $2 million on an “as is” basis. He then says that the effect of the proposed trail “will be significantly negative in terms of its impact on value”. He identifies loss of privacy and ambience, given that the fence line between the two properties is approximately 40 metres beyond the Simunacs’ dwelling. He says the view lines from the proposed track will be looking directly down and into the Simunacs’ dwelling and property, which will intrude on the current private situation and ambience of the Simunac property. He also identifies concerns arising from a risk of trespass, an increase in rubbish and litter, and additional wear and tear on the metal/gravel driveway. However, he does not seek to place any particular value on this negative impact, nor does he expressly separate out the effective registration of the walking trail easement from feared outcomes if and when it is operational.
[15] Ms Lu opposes the application for an interim injunction on the basis that the plaintiffs’ position is sufficiently protected by the second defendant giving an undertaking that it will not take any steps to make the walkway in issue operational under the Walking Access Act, or to take any steps to commence construction of the walkway until these proceedings have been determined by this Court. Therefore, there is no substantial or unreasonable interference with the plaintiffs’ use and enjoyment of the land, nor can there be any imminent or substantial danger from use of that nature. The first defendant now wishes to proceed with registration because failure to comply with her statutory obligation may result in the OIO requiring the first defendant to dispose of her land and of the Matakana Estate.
[16] WAC opposes any interim injunction (beyond the undertaking that has been offered) on the following grounds (among others):
(a)mere registration of the easement on the first defendant’s title does not risk creating a public or private nuisance;
(b)the registration of the easement is insufficient to permit the lawful use of the land as a walkway, and the plaintiffs will have the opportunity to have further input into the resource management consent process, given that resource consents will be required to construct the walkway;
(c)the undertaking proposed by the second defendant adequately preserves the plaintiffs’ position pending the hearing of their claim;
(d)the mere registration of the easement does not impact on the plaintiffs’ use of their own right of way, and, in any event, they abandoned their derogation of grant cause of action; and
(e)the order sought to enjoin registration of the walking trail easement would not preserve the plaintiffs’ position but would improve it.
Legal principles
Interim injunctions
[17] The principles governing the granting of an interim injunction include the established three stage inquiry required when the Court is considering an application for an interim injunction:4
(a)the applicant must establish the existence of a serious question to be tried;
(b)the Court must consider the balance of convenience, weighing up the impact on the applicant of the order not being granted, and the impact on the respondent of the order being granted; and
(c)the Court must carry out an assessment of what will best achieve the overall interests of justice.
[18] A serious question to be tried means one not vexatious or frivolous, on which the plaintiff has at least “a tenable basis upon which it might be able to succeed at trial”.5
[19] If a plaintiff establishes that it has a serious question to be tried, the Court must then make enquiry into the balance of convenience. The question is if refusing the injunction would be harder on a plaintiff who was successful at trial, than granting it would be on the successful defendant.6 This assessment usually is undertaken by reference to the adequacy of damages, preservation of the status quo, the uncompensable disadvantages to either party, and the relative strengths of their cases.
[20] The Court may grant a quia timet injunction to prevent a threatened infringement of the plaintiffs’ rights that has yet to occur.7
4 Intellihub Ltd v Genesis Energy Limited [2020] NZCA 344, [2020] NZCCLR 29.
5 At [24] and [27].
6 Inguran, LLC v CRV Ltd [2023] NZHC 3692 at [15], referencing Wellington International Airport Ltd v Air New Zealand Ltd HC Wellington CIV-2007-485-1756, 30 July 2008 at [4].
7 Redland Bricks Ltd v Morris [1970] AC 652 at 664; [1969] 2 A11 ER 576 at 578.
Registration and priorities
[21] Registration lies at the heart of the Torrens system of land provided for under the Land Transfer Act 2017.8 Everything that can be registered gives, in the absence of fraud, an indefeasible title to the estate or interest, or in the cases in which registration of a right is authorised, as in the case of easements or incorporeal rights, to the right registered.9
[22] Section 35 of the Land Transfer Act enacts a general rule for determining the relative priority of registered instruments. It provides that an “instrument has priority according to the time when it is lodged [for registration], not when it is executed”.10
[23] The effect of determining priority is to give full enjoyment of the interest to the party with priority, leaving the other with either no interest (if it is entirely incompatible or extinguished by the exercise of the prior rights), or a reduced interest.11 If there is no incompatible conflict, then the two may coexist and operate concurrently in accordance with their terms.12
[24]The priority in s 35 is subject to some qualifications, including:13
(a)the person taking under a registered instrument may have been guilty of “fraud” as defined;14
(b)another statutory exception or limitation to indefeasibility might apply;15
(c)statutes that override the Land Transfer Act, may, if they so provide, alter the priorities fixed by s 35;16 and
8 DW McMorland and others Hinde McMorland and Sim Land Law in New Zealand (looseleaf ed, LexisNexis) at [8.018(a)].
9 Fels v Knowles (1906) 26 NZLR 604 (CA) at 620.
10 Land Transfer Act 2017, s 35(2).
11 Peter Stubbs “Equitable Priorities and the Failure to Caveat” (1989) 6(2) AULR 199 at 201.
12 Tenacity Investments v Ku-ring-gai Council [2008] NSWLEC 27 at [42]–[43], [49] and [56].
13 Hinde McMorland and Sim Land Law in New Zealand, above n 8, at [8.031(c)].
14 Land Transfer Act, ss 6, 52(1)(a) and s 51(3).
15 Sections 52–57.
16 Hinde McMorland and Sim Land Law in New Zealand, above n 8, at [8.031(c)] and n 15, referencing as an example the Statutory Land Charges Registration Act 1928.
(d)indefeasibility does not bar the right of a plaintiff to bring against a registered proprietor a claim in personam, founded in law or in equity, for such relief as a court acting in personam may grant.17
[25] Section 35 does not govern equitable priorities. Subject to the effect of the caveat procedure,18 the priority of unregistered interests is determined by the ordinary principles of equity.19
Easements
[26] Easements are created to confer benefits on the occupiers of other nearby land or on persons (easements in gross). The benefits that are granted by an easement do not amount to occupation of the land but are confined to the ability of the grantee to use the land for some specified purpose.20 A right of way is a common type of easement, which allows access across another’s property (the burdened land) to the benefited land.21 Other rights, which the law has not recognised as being capable of being protected by easement, are created by covenant. These include rights to a view and rights to privacy.22
[27] Easements are created by grant, or by contract to create a grant, and may therefore exist as registered legal interests or as equitable interests. Restrictive covenants cannot be created by grant and exist only as equitable interests in land.23
[28] Once an easement is granted, the owner of the burdened land cannot lawfully derogate from it:24
17 Infinity Enterprises NZ Ltd v Kinara Trustee Ltd [2020] NZCA 309, [2020] 3 NZLR 626 at [40]– [43].
18 Hinde McMorland & Sim Land Law in New Zealand, above n 16, at [10.005].
19 At [9.005].
20 At [16.012].
21 Section 111 of the Land Transfer Act provides for regulations to prescribe rights and powers in different classes of registered easement, including a right of way. These are currently contained in the Land Transfer Regulations 2018 r 21 and sch 5, but under cl 1 of sch 1 the earlier 2002 regulations will still apply for many right of way easements (the 2002 regulations were made under s 90D of the Land Transfer Act 1952 and revoked by s 249 of the Land Transfer Act 2017). In addition, the Property Law Act 2007, s 297 refers to sch 5 and implies certain covenants in a vehicular right of way.
22 Hinde McMorland & Sim Land Law in New Zealand, above n 16, at [16.006(d)].
23 Property Law Act, s 307. These may be protected by notice on the record of title to the burdened land.
24 Breslin v Lyons [2013] NZCA 161, (2013) 14 NZCPR 144 at [23]–[24].
To the extent of the grant of easement, Mr Breslin has surrendered to the Lyons an ordinary incident of ownership of his property for as long as the easement exists. Mr Breslin can only use his [burdened] land in a way that does not derogate from the Lyons’ right to pass and repass over his property. Parking a vehicle permanently there will create an obstruction to that right if, as a matter of fact, it will hinder the Lyons’ use of the area for access to their property. That would constitute a substantial and thus unlawful interference with the rights of freedom and ease of passage conferred by the grant, amounting in law to a derogation from it.
[29] Section 316 of the Property Law Act 2007 (the 2007 Act) permits an application for an order under s 317 (court may modify or extinguish easement or covenant) to be made by “a person bound” by an easement, a positive covenant, or a restrictive covenant. That term is defined in s 4 of the 2007 Act, which provides as follows:
person bound means, in relation to an easement, a positive covenant, a restrictive covenant, or a covenant in gross (as defined by section 307A) burdening land, an owner or occupier of the land against whom the easement or covenant is enforceable
[30] The “person bound” has consistently been interpreted as the owner of the burdened land,25 or a tenant occupying the burdened land under a lease for a term of not less than 10 years certain, or, in certain situations, a mortgagee in possession. Critically, the owner of the benefited land is not a “person bound” by the easement or covenant and thus has no standing to make an application under s 317.26
[31] In Gregory v EK Trust Ltd, a right of way was established by two separate cross easements; the western strip of the right of way was owned by the respondent and the eastern strip by the applicant.27 The respondent had removed a gate that was on the western right of way. On an application for an interim injunction to have the gate restored, the applicants claimed that if the easement did not require a gate, the Court could modify the easement to provide for such a right under s 317 of the 2007 Act.
25 Hinde McMorland & Sim Land Law in New Zealand, above n 16, at [17.038] and n 7, referencing Harnden v Collins [2010] 2 NZLR 273, (2009) 11 NZCPR 189 at [57]–[59] per Randerson J; Gregory v EK Trust Ltd [2015] NZHC 1785, (2015) 16 NZCPR 519 at [41]–[52] per Katz J; and Davey v Baker [2016] NZCA 313, [2016] 3 NZLR 776 at [56] and [69]–[74] per Stevens J for the Court.
26 At [17.038] and n 9, referencing Harnden v Collins, above n 25, at [57]–[59] per Randerson J; Gregory v EK Trust Ltd, above n 25, at [41]–[52] per Katz J; and Davey v Baker, above n 25, at [56] and [69]–[74] per Stevens J for the Court.
27 Gregory v EK Trust Ltd, above n 25.
Katz J held that on the plain meaning of ss 316 and 317, the applicants were not the “person bound” and thus not entitled to bring an application.28 Section 317 has an asymmetrical focus on the “person entitled”, directed at relieving the burden of the easement on the applicant’s land rather than improving the position of the person with the benefit of the easement.29
[32] In Davey v Baker, the Court of Appeal rejected the argument that the Daveys were a “person bound” in their capacity as the persons benefiting from a right of way easement.30
[69] … A mere interest as a person entitled to use the easement is not, and has never been, sufficient to bring an application for modification. Thus, the Daveys do not come within the definition of “person bound” by an easement for the purposes of s 316.
[70] Nor do the Daveys come within the definition of a “person bound” by a positive or restrictive covenant expressed in the easement. Mr Allan claims that the Daveys were bound by a restrictive covenant which limits the use of the easement facility within the servient tenement and/or a positive covenant to contribute to the upkeep and maintenance per sch 9 of the 1952 Act. However, we agree with Brown J that neither of these fit within the statutory definitions given in s 4 of the 2007 Act (set out at [52] above). In neither case are the Daveys undertaking to do something, or refrain from doing something, in relation to their own land that would be for the benefit of the Bakers’ land.
[33] The Court of Appeal noted that a narrow approach was also justified because of private property and indefeasible title interests:31
We consider caution is required in relation to modification, in part because of the adverse impact on private property interests that may follow the making of an order. Here the private property interest involved is not simply losing the benefit of an interest in an easement but rather concerns an intrusion on the indefeasible title that the Bakers have to their land not currently subject to the easement. These factors arguably warn against an over-broadening of the statutory provision in order to incorporate the Daveys’ application.
[34] For instruments created on or after 12 November 2018, ss 108–110 of the Land Transfer Act provide a process for an easement to be surrendered. An easement instrument under s 109, or a transfer instrument under s 73, must be used in order to
28 At [52].
29 At [47].
30 Davey v Baker, above n 25 (footnotes omitted).
31 At [74]. See also Okey v Kingsbeer [2017] NZCA 625, (2017) 19 NZCPR 25 at [52].
register the surrender of a registered easement or profit à prendre.32 The instrument must be executed by the grantor and the grantee,33 and the consent of any registered mortgagee of any benefited land must be obtained before the registration of an instrument that surrenders an easement or profit à prendre.34 An easement instrument must be executed by the registered owners of the benefited land and burdened land, in the case of an appurtenant easement, or by the benefited person and the registered owner of the burdened land, in the case of an easement in gross.35
New Zealand Walking Access Commission
[35] WAC is established by the Walking Access Act.36 It is a Crown entity, with a board of at least five, and no more than eight, members.37
[36] Under that Act, walkways may be created over public or private land. If WAC considers that all or part of any private land should be made available for use as a walkway, it ma y negotiate an agreement with the landholder for an easement or lease over all (or part) of the land for use as a walkway, or for the purchase of any land that includes all or that part of the land proposed for use as a walkway.38
[37] The private land that is declared a walkway must be defined on a plan, and WAC must lodge with the Registrar-General of Land, in a form registrable under the Land Transfer Act, an easement or lease, or a transfer to WAC of the fee simple estate.39 Subject to the provisions of the Walking Access Act and any other enactment relating to the administration or control of public land, and to any conditions imposed in relation to a walkway, a member of the public may pass or repass over a walkway on foot (and perform any activity that is reasonably incidental to that passing or repassing) at any time and without charge.
32 Land Transfer Act , s 108(1).
33 Section 108(2).
34 Section 109(4).
35 Section 109(2) and the definitions of “grantor” and “grantee” in s 107.
36 Walking Access Act 2008, s 6.
37 Sections 7 and 8.
38 Section 26; and M Sinclair Laws of New Zealand Recreation and Entertainment (online ed) at [135].
39 Section 29.
[38] As recorded in the draft walking trail easement in this case, registration of the instrument does not in itself create a walkway with public access rights. Under s 31 of the Act, a walkway must be named and declared by notice in the NZ Gazette before any walkway rights come into effect.
[39] WAC may appoint a department, local authority, or public body, or the Commissioner of Crown Lands, to be the controlling authority of a walkway.40 The controlling authority for a walkway may close any walkway or part of a walkway if it is satisfied on reasonable grounds that the walkway should be closed for one of the reasons outlined in s 38, including “at the request of the landholder of the adjacent land”.41 However, a walkway must not be closed for any longer than the controlling authority considers necessary.42
[40]A controlling authority may revoke any declaration of a walkway, but only if:
(a) the land on which the walkway is located is no longer suitable or available for use as a walkway;43 or (b) WAC and the controlling authority of the walkway agree that it is no longer appropriate to retain the walkway.44 If a walkway over private land is revoked, WAC must ensure that, as soon as reasonably practicable, the easement or lease relating to the former walkway is surrendered and the surrender is registered.45
Overseas investment
[41] The OIA sets out the regime for overseas investments in sensitive New Zealand assets, as defined under the Act. The purpose of the OIA is to acknowledge that it is a privilege for overseas persons to own or control sensitive New Zealand assets by requiring that overseas investments in those assets, before being made, are to meet certain criteria for ministerial consent, and by imposing certain conditions on those overseas investments.46
40 Section 35.
41 Section 38(1)(d).
42 Section 38(3).
43 Section 40(1)(a) and 40(2)(c) and (d): reasons for the land becoming unsuitable or unavailable for use as a walkway include the need to protect the environment and the need for public safety.
44 Section 40(1)(b); and Laws of New Zealand, above n 38, at [142].
45 Section 42.
46 Overseas Investment Act 2005, s 3(1). See J Brinsley Laws of New Zealand Trade and Commerce (online ed) at [22].
[42] The criteria for consent are set out in ss 14–20 of the OIA. This includes a “benefit to New Zealand” test. One of the means of satisfying that test is continued or enhanced access by the public, or any section of the public, within or over the sensitive land or the features giving rise to the sensitivity (for example, access for recreational purposes or for the purposes of undertaking stewardship of, or exercising kaitiakitanga in relation to, historic heritage or the natural environment).47 In this case, the proposed walking trail easement was identified as something that supported a grant of consent, and it was imposed as a condition of consent under s 25A as a matter of the Minister’s discretion.
[43] The regulator has the power to issue a notice requesting the disposal of property if he or she has reasonable grounds to believe that a person has contravened the OIA, committed an offence under the Act, or has failed to comply with a condition of consent or of an exemption.48
Nuisance, privacy and statutory defences
[44] In respect of the plaintiffs’ concerns about adverse effects on the privacy and amenity of the house on the Simunac property, the plaintiffs rely on the UK Supreme Court decision Fearn v Board of Trustees of the Tate Gallery.49 In that case, Lord Leggatt delivered the decision of the majority, concluding that the plaintiffs could successfully bring a claim of nuisance against the Tate Gallery for the effects of a viewing gallery that overlooked the plaintiffs’ flats unreasonably, thereby interfering with their enjoyment of the flats. Lord Leggatt distinguished between mere overlooking (which is not actionable), with “being constantly watched and photographed by onlookers from neighbouring land” (which may be actionable).50 Lord Sales for the minority agreed that visual intrusion of the latter type was capable of amounting to a nuisance.51 While Fearn has been referred to by the New Zealand
47 Section 17(1)(c).
48 Section 41F.
49 Fearn v Board of Trustees of the Tate Gallery [2023] UKSC 4, [2024] AC 1.
50 At [89]–[104], especially [98].
51 At [179].
Supreme Court,52 its applicability in New Zealand has not yet been determined, including how those concepts relate to the tort of privacy.53
[45] In any event, the defendants take the position that the use contemplated by the walking trail would not meet the high threshold set in Fearn, given that ordinary overlooking by pedestrians or cyclists from time to time would not amount to “being constantly watched and photographed”. Furthermore, for the purposes of this interim injunction application, they say that the granting and registration of the walking trail easement will not itself cause any actionable “act of overlooking”.
[46] In terms of the affirmative statutory defences that have been pleaded, all parties refer to Barr v Biffa Waste Services Ltd. As established in that case, the mere fact of planning permission or resource consent for the activity on the benefited land “may be a defence to an action in nuisance, but only if statutory authority to commit a nuisance is express or necessarily implied”.54 It is a question of construction whether a statute authorises or requires an act to be done in a manner that preserves liability for nuisance.55 If the statute authorises a particular act only to the extent that no nuisance is caused, or requires an act to be done without causing a nuisance, or otherwise preserves civil liability for nuisance, statutory authority will be no defence.56
Application to the facts
[47] The first question is whether there is a serious question to be tried. The defendants take the position that there is no serious issue to be tried on the question of whether there could be a visual nuisance of the type described in Fearn. They say transitory use of the walking trail would simply not meet the level of intensity referred to in Fearn, even if mere overlooking could amount to a nuisance as a matter of law in New Zealand. They did not otherwise dispute that the plaintiffs are entitled to
52 Young v Attorney-General [2023] NZSC 142 at [91]–[94]; and Smith v Fonterra Co-Operative Group Ltd [2024] NZSC 5 at [111].
53 Joanna Pidgeon, Oscar Robertson and Xavia Hayward “Tate Gallery and the emerging tort of private nuisance” (2023) 23(3) Property Lawyer 25.
54 Barr v Biffa Waste Services Ltd [2012] EWCA Civ 312, [2013] QB 455 at [36(v)] per Carnwath LJ for the Court. In this case permission for the operation of a waste tip which happened to emit foul odours was not sufficient to outweigh the local residents’ common law rights in nuisance.
55 A McKenzie Laws of New Zealand Nuisance (online ed) at [55].
56 At [55] and n 3.
pursue their claims that use of the walkway could constitute a public or private nuisance, based on the other impacts the plaintiffs have pleaded. For present purposes, I therefore assume that there is a serious question to be tried under the plaintiffs’ public and private nuisance causes of action, so the appropriateness of granting interim relief falls to be determined by balance of convenience factors.
[48] Next, I assess the effect of refusing the injunction on the plaintiffs who might be successful at trial. Refusing the injunction will have the consequence that the walking trail easement is registered, but the undertaking offered by the defendants will mean that no further steps are taken to form the walkway or make it legally operational until the substantive outcome in this proceeding has been determined. The plaintiffs have raised a legitimate concern that the second defendant would thereby gain a registered legal easement interest, and the plaintiffs would not have standing under s 317 of the 2007 Act to seek extinguishment of that easement. They also would not control surrender of the easement under s 110 of the Land Transfer Act, because the grantor and the grantee must voluntarily surrender under that provision. Section 110 does not confer a direct power on the Court to extinguish indefeasible interests on the application of another party.
[49] However, I do not consider that registration of the walking trail easement would be legally detrimental as against the ROW easement. As set out in [23] above, the ROW easement will remain registered first in time, and therefore it has priority. The plaintiffs have a right under their own ROW easement for any adverse impact on the costs of maintaining the driveway to be addressed (and if the walkway is formed and becomes operational, I understand the costs and responsibilities of maintenance would be assumed by Auckland Council anyway). Furthermore, I consider there is scope to seek determination of any alleged incompatible conflict between the two easements (a priority dispute). I do not need to determine these issues for the purposes of the interim injunction application because the plaintiffs have withdrawn their cause of action based on the ROW easement and non-derogation from the grant.
[50] In the present proceeding, the only causes of action are in public and private nuisance, which focus on the impact on the Simunac property as neighbouring land. In that capacity, a neighbour would not normally have any entitlements to constrain
how another owner deals with their own indefeasible title interests. For example, if Ms Lu had agreed to transfer the entirety of the Lu property to the second defendant in anticipation of a walkway being created, I do not consider that the plaintiffs would have any proper grounds to enjoin that freehold transfer, simply because of their concerns about the potential walkway. Rather, the plaintiffs would continue to have potential avenues to object to the walkway, whether under the resource management process or other causes of action in public or private nuisance, without this inhibiting Ms Lu’s private property indefeasible title interests. If the plaintiffs do not have a proper standing via the ROW easement to make an application under s 317 in respect of somebody else’s burdened land, then it is even harder to justify that type of standing to seek interim injunctive relief based on causes of action that do not constitute interests in land.
[51] While I accept that registration of a walking trail easement on the neighbouring land will be detrimental from the Simunac perspective, I do not accept that mere registration would cause actionable damage. If the plaintiffs are entitled to prevent the establishment of a walkway within the resource consent process or in their private or public nuisance causes of action, then they will be able to explain to potential purchasers that the registered walking trail easement is of no practical effect. In those circumstances, there might also be administrative law grounds to expect the controlling authority ultimately to revoke the walkway because the land on which it is located is no longer suitable or available for use as a walkway (in which case surrender of the walking trail easement must follow),57 or there might be an ability to seek in personam relief.58 To the extent that the plaintiffs might not ultimately be able to achieve those objectives in law, in my view they cannot expect to prevent registration of the easement now.
[52] Overall, I accept the submissions of the defendants that the mere registration of the walking trail easement on the first defendant’s title does not itself risk creating a public or private nuisance, nor does it permit or result in any unlawful use of the land as a walkway. Furthermore, the plaintiffs say that the potential future establishment of a walking trail already adversely impacts on the value of their land. There is no
57 See [40] above.
58 See [24](d)] above.
evidence substantiating that registration of the walkway easement would make any material difference. Meanwhile, from the public interest perspective, registration has the advantage that any future purchasers may be fairly informed about these existing plans and possibilities, which are already a matter of public record.
[53] While it is a matter for the substantive hearing, there is no automatic private entitlement to prevent diminution in value (such as loss of view or privacy) caused by changing use on a neighbour’s land, particularly in the absence of any restrictive covenant.59
[54] I now turn to consider the effect of granting the injunction on the defendants who may ultimately succeed in the substantive proceeding.
[55] Ms Lu and WAC rely on the fact that non-compliance with the OIO consent, being a failure to register the walking trail easement by 30 June 2024, may result in Ms Lu being required to dispose of the Lu property and Matakana Estate. These are serious potential consequences. The plaintiffs respond by saying that this could have been addressed by Ms Lu applying to the OIO for a variation, being either an extension to the deadline for registering the easement under the existing proposal to a date that would allow the substantive proceeding to be heard and determined first, or to seek a variation of the walking trail easement to one of the alternative routes raised by the Simunacs. The plaintiffs say that the first defendant’s failure to take this step is an important factor to be considered in determining the balance of convenience.
[56] I accept that Ms Lu understandably wants to achieve satisfaction of the OIO consent condition and does not want that uncertainty hanging over her beyond the existing deadline. Similarly, WAC has an interest in securing registration of the easement now. Even if this Court were to grant the injunction, it would not necessarily follow that the OIO would grant an extension. I do not see Ms Lu’s failure to seek an extension as a disabling factor, given my analysis of the other balance of convenience factors.
59 See [26] above.
[57] The plaintiffs argue that enjoining registration of the walking trail easement amounts to preservation of the status quo. The difficulty is that the status quo will change if the OIO consent condition is not satisfied on 30 June 2024. On one view, the status quo is that Ms Lu has an existing indefeasible property entitlement to deal with her land and comply with her OIO consent obligations. Any orders inhibiting that would substantially undermine those rights. Accordingly, I do not consider the status quo arguments to be particularly persuasive.
[58] An important factor in a balance of convenience assessment is whether any disadvantage can be compensated adequately. The plaintiffs’ own valuation evidence supports the defendants’ argument that any adverse impacts of the walkway would be measurable in damages (i.e., by any detrimental impact on the market value of the plaintiffs’ land). These can be compensated financially if there is an actionable right under a private or public nuisance action. I also acknowledge the defendants’ arguments that the resource consent process is designed to achieve proper mitigation measures.
[59] To conclude, I remind myself that this interim injunction is solely about the registration of a legal easement. The undertakings offered by the second defendant will otherwise protect the plaintiffs’ substantive entitlements to prevent the formation and legal commencement of the walking trail, if they have any private entitlements to do so. In that context, my assessment is that the registration of the legal easement would not cause any uncompensable disadvantage to the plaintiffs. On the other hand, I accept the importance to the defendants of achieving certainty of registration, given the OIO consent condition and the 30 June 2024 deadline. Overall, I find that the balance of convenience favours declining the interim injunction.
[60] In the event that I took that view, the plaintiffs asked for interim orders to protect their appeal rights. I have provided for that in the order set out in [61] below, which is designed to allow time for registration of the walking trial easement after 31 May 2024 but before the 30 June 2024 deadline, subject to allowing the plaintiffs to seek a stay/extension from the Court of Appeal before 31 May 2024.
Result
[61] I order that the defendants be restrained until 31 May 2024 from granting and/or registering any easement on the property at 494 Matakana Road, Matakana (record of title 583823) in relation to the Puhoi to Mangawhai walking and cycling trail. On 31 May 2024 at 5 pm this order will expire, unless extended by the Court of Appeal.
[62] I record the second defendant’s undertaking not to take any steps to make the walkway operational under the Walking Access Act, or to take any steps to commence construction of the walkway until these proceedings have been determined by the High Court.
[63] I reserve the issue of costs. Rule 14.8 of the High Court Rules 2016 creates a presumption that costs on opposed interlocutory applications are to be fixed by the court when the application is determined. This reflects the fact that the merits of particular applications and the merits of the substantive proceedings may be quite different. However, in this case I consider that costs should fairly be determined based on the substantive merits of the proceeding, so I reserve costs for that reason.
O’Gorman J
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