Tiller v Auckland Council

[2024] NZHC 1967

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2021-404-800

[2024] NZHC 1967

BETWEEN

BRENT TILLER

Plaintiff

AND

AUCKLAND COUNCIL

Defendant

Hearing:

4 to 7 June 2024

Appearances:

A Gilchrist and R Kaur for the Plaintiff

S Quinn and E Manohar for the Defendant

Judgment:

18 July 2024

JUDGMENT OF GORDON J

This judgment was delivered by me on 18 July 2024 at 10 am, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Solicitors/Counsel: DLA Piper, Auckland A Gilchrist, Auckland R Kaur, Auckland

TILLER v AUCKLAND COUNCIL [2024] NZHC 1967 [18 July 2024]

[1]    The plaintiff, Brett Tiller, has filed a claim seeking over $18 million plus interest and costs from the defendant, Auckland Council (Council). That sum was reduced in closing submissions to around $10.3 million together with interest and costs. That is still a substantial sum.

[2]    Mr Tiller says the Council needs to pay him that amount because it has trespassed on his property by constructing an open watercourse (watercourse) on his land and the Council is using the watercourse as part of its stormwater system causing catchment stormwater to flow through his property when it would not do so naturally.

[3]    As a further part of his claim Mr Tiller says the Council has also committed an act of trespass by not upsizing the Lyons Avenue culvert (culvert) which is 80 metres downstream (to the east) from his property. He says drainage and stormwater back up at the culvert and flow back onto his property.

[4]    Mr Tiller also says he has a claim in contract against the Council because it has breached six alleged “undertakings” that it would upgrade the culvert by increasing its size.

[5]    Two further causes of action in nuisance and negligence were abandoned in closing submissions.1

[6]    The Council opposes the claim. It says the claim for trespass fails because it is unsubstantiated by evidence. The Council says it has not acted (or omitted to act) in any manner which could properly attract liability under either of the two pleaded causes of action. The Council says there is a fundamental issue of causation. It says any interference, loss or damage from the presence of the watercourse, stormwater or flooding of the property, was not caused by any of the alleged actions or inaction of the Council.

[7]    The Council says Mr Tiller’s property is inherently subject to inundation. A consent notice to that effect was recorded on the title before Mr Tiller settled the

1Mr Tiller abandoned those two causes of action on the basis of counsel’s assessment that they were time barred.

purchase of the property and the watercourse was present and able to be seen at the time of inspection prior to purchase. The property was, accordingly, known to be subject to inundation from that watercourse. The design and construction of the dwelling that occurred subsequently responded to that risk.

[8]    The Council also raises issues of limitation, the doctrine of natural servitude and further says the relief claimed is entirely inappropriate.

[9]    Mr Tiller gave evidence himself and called evidence  from  a  valuer,  Richard Swan. The Council also called evidence from a valuer, Evan Gamby. As well the Council called evidence from a stormwater engineer, Maree Gleeson. There was no stormwater engineering evidence called by Mr Tiller.

Background

[10]   Mr Tiller is the registered proprietor of the property at 12 Montana Avenue, Murrays Bay, Auckland (property).

[11]   On 9 November 1994 Mr Tiller entered into an agreement for sale and purchase to purchase the property which had been created as a result of the subdivision of  Lots 36 and 37, which had street  frontages  on  both  Saddleback  Rise  and  Montana Avenue, which run parallel to each other. The houses on Lots 36 and 37 were at the Saddleback Rise end of those two lots. A part of each of the two lots at the Montana Avenue end were divided off and were combined into a new lot, Lot 3, which is the property in this proceeding. The balance of the land in Lots 36 and 37 became Lots 1 and 2 respectively.

[12]   The plan of the proposed subdivision of Lots 36 and 37 indicates the presence of an “existing open watercourse” which runs through the property from the western boundary (upstream) to the eastern boundary (downstream) near the rear boundary of Lot 3. Refer the subdivision plan which is Annexure 1 to this judgment.

[13]One of the conditions of the subdivision consent was:

10.Pursuant to Section 221 of the Resource Management Act, the owner shall cause to have registered on the Certificate of Title to be issued

for Lot 3 a consent notice containing the following text for the purpose of ensuring that appropriate notice is brought to any prospective purchaser or other interested party of the following requirements:

(i)All earthworks, retaining walls and building foundations shall be designed and have construction supervised by a registered engineer.

(ii)The owner shall not proceed with building development proposals on the undeveloped part of the land otherwise than in accordance with the provisions of the North Shore City Council Stormwater and Flood Protection Policy, as the land is subject to inundation.

(emphasis added)

[14]   A consent notice was accordingly registered on the title on 3 May 1995, the day on which the Certificate of Title issued.2

[15]   Mr Tiller settled the purchase on 27 July 1995. Mr Tiller’s evidence was that he was not aware of the consent condition prior to settlement. However, it is clear that it was registered on the title before the date of settlement. Also Mr Tiller had inspected the site with the real estate agent acting for the vendor prior to signing the agreement for sale and purchase and accordingly he was aware of the existence of the watercourse on the property.

[16]   Having regard to the subdivision consent condition, the construction of a dwelling on the property required a resource consent. Mr Tiller submitted an “Assessment of Effects Report” in support of his application for resource consent. Mr Tiller’s evidence was that he drafted part of the report and he sent his research to his architect who completed and submitted the report.

[17]   A description of the site which includes a reference to the watercourse as a “natural watercourse” is as follows:3

Site

The site is set back approximately 7 metres from the edge of the seal forming Montana Avenue. The land slopes quickly down from the road edge, with the

2When reference is made to the consent notice itself there is clearly an error as the word “not” has been omitted between the words “shall” and “proceed” in the first line of condition 10(ii). That omission is not material in terms of the issues in the proceeding.

3      The report later refers to it as a “stream (which doubles as a Council stormwater channel)”.

centre of the natural building area approximately 2 to 2.5 metres below the road. A natural water course runs diagonally through the property roughly parallel to the southern boundary. This severely restricts the available building area with a 3 metre setback from the edge of the bank preventing any construction on the rear 220 square metres of the site. The site itself is an irregular rectangular shape, and with front and side yard setbacks the building area becomes almost triangular.

[18]   The Assessment of Effects Report then expressly addressed the flood risk for the purposes of determining the appropriate habitable floor level:

10 and 100 year flood plains affect the lower areas on the site, and building platform levels have been established by a Registered Engineer ( see attached report ).  This  raises the levels of  habitable and garage floors requiring the  9 metre control flexibility for overall height to be employed.

[19]   In other words, the figures that Mr Tiller’s engineer had modelled for floor levels responded to the 10 and 100 year flood levels.

[20]   The watercourse is the main conveyance channel for runoff from the upstream Taiorahi catchment area of 139 hectares. A December 1946 plan shows the existence of what is described as a “seasonal swamp” running in an east/west direction across the rear of then Lots 36 and 37 and encompassing almost the entirety of what is now Lot 3/the property. The 1946 plan shows the swamp narrowing to a more defined watercourse at the location of the culvert which was constructed in 1960. Lyons Avenue runs perpendicular to Saddleback Rise and Montana Avenue and the culvert was constructed under Lyons Avenue.

[21]   The property is known to be in a flood prone area. There are notations on the Auckland Council GeoMaps, the Auckland Unitary Plan (the relevant framework under the Resource Management Act 1991) and a LINZ aerial map, all of which indicate that the property is flood prone.

[22]   The property flooded during the significant weather event on Friday 27 January 2023, Auckland Anniversary weekend (including the lower habitable floor of the dwelling and the garage). The land, but not the dwelling, also flooded on 9 May 2023.4

4Mr Tiller’s evidence was that flooding of the land (but not the dwelling) occurred on 9 May 2023 whereas the date in the agreed chronology is 9 March 2023.

[23]   On 29 January 2023 the property was “yellow stickered” by the Council (preventing residential occupation until the sticker was removed) due to the flooding damage sustained. Mr Tiller’s evidence was that the payment from his insurance company of $341,000 (excluding the amount for contents) more than covered the cost of remediation (although that calculation does not factor in his time spent on the process). He was able to return to the property after 11 or 12 months.

First cause of action: trespass to land

The alleged acts

[24]Mr Tiller says there are three acts of trespass by the Council to his land:

(a)The construction of a watercourse in the area of the seasonal swamp sometime between 1946 and the late 1950s or early 1960s. In response the Council says there is no evidence that the Council constructed the watercourse.

(b)The use by the Council of the watercourse for stormwater runoff that goes beyond the ordinary flow of stormwater runoff. In response the Council says there is a natural flow of stormwater in the watercourse which does not constitute a trespass.

(c)By not upsizing the culvert 80 metres downstream from his property, the Council has deliberately diverted water through the culvert and onto his property. In response the Council says Mr Tiller has not provided any evidence that the culvert is responsible for flooding on his property.

Trespass to land: legal principles

[25]   There is no issue between counsel as regards the legal principles to be applied. The contest is in relation to the application of the facts of this case to those legal principles.

[26]   An unjustified direct interference with land in the possession of another is a trespass and is actionable per se without proof of actual damage.5 There are thus two key elements: a direct interference with land possessed by another and the interference must be unjustified. “Unjustified direct interference” includes both an intentional or negligent action.6

[27]   A trespass is committed where a defendant, while not personally crossing the boundary of a plaintiff’s land, instead causes some other person or thing directly to intrude upon the land. The unauthorised entry must follow directly upon the defendant’s act. If the intrusion of an object is merely the indirect or consequential result of the defendant’s act, trespass will not lie (although the defendant may be liable in nuisance).7

[28]   The leading authority on the issue of a direct or indirect result of a defendant’s act is Southport Corporation v SO Petroleum Co Ltd which concerned the discharge of oil into an estuary which was then carried by the action of the tide onto the plaintiff’s foreshore.8 The decision turned on an assessment of the certainty of the oil reaching the shore. The learned authors of Todd on Torts suggest the question is whether contact with the plaintiff’s land was a “necessary or natural consequence” of the defendant’s act: if the answer is “yes”, then trespass will lie.9

Public versus private drain distinction

[29]   Whether the watercourse is a public or a private drain is not a complete answer to the issue of trespass but it is relevant.

[30]   Mr Tiller expressed his view, as a layperson, that there is a difference between a public drain and a private drain. Under cross-examination he accepted that his property is located in a flood plain. It was put to him that water naturally flows through the watercourse during the course of the year. He responded that some of the water is

5      Stephen Todd and others Todd on Torts (9th ed, Thomson Reuters, Wellington, 2023) at [8.2.1].

6      Mayfair Ltd v Pears [1987] 1 NZLR 459 (CA) at 465.

7      Todd on Torts, above n 5, at [8.2.5(2)].

8      Southport Corporation v SO Petroleum Co Ltd [1954] 2 QB 182 (CA).

9Todd on Torts, above n 5, at [8.2.5(2)]. Mr Gilchrist also refers the Court to Jacobs v Waikato District Council [2015] NZHC 1372, [2015] NZAR 1343 as authority for the proposition that the discharge of stormwater over land without any legal right or consent constitutes trespass.

natural. But he said that there is also water that is collected and piped into the watercourse. I will refer to that issue further but make it clear that Mr Tiller is not an independent expert and accordingly I place no weight on his views about the distinction between natural flows and artificial flows.

[31]   The evidence of Ms Gleeson, the only expert who gave evidence on this issue, is that the watercourse is not a public drain. She maintained that position when directly cross-examined on the point. Additionally, when she was questioned about work that the North Shore City Council had undertaken in relation to erosion of the streambank following a request by Mr Tiller, her position was that the works were not done as a result of the Council accepting responsibility for the watercourse but rather for other reasons relating to slope stability or structural stability of buildings. She said it is not uncommon for the Council to assist landowners with watercourses where there are stability issues. It would be common for the Council to do the work itself and in some cases at its cost. She said it is not uncommon for the landowner not to be asked to contribute to the cost.

[32]   The leading authority to which both counsel refer on the distinction between a public and a private drain is Wellington City Council v Longhurst.10

[33]   Longhurst confirms that for a drain on private property to be a public drain the requirement is control, actually and consciously, exercised by a local authority for a sustained period. As counsel note, the decision in Longhurst in part turned on s 441(2) of the Local Government Act 1974, which was repealed in 2003 by the Local Government Act 2002. However, Longhurst does continue to represent the common law position on the public and private drain distinction. In that case the factors that

10Wellington City Council v Longhurst [1995] 3 NZLR 300 (CA) followed in Dunedin City Council v McEntyre [1998] HC Dunedin AP12/98, 7 October 1998; Gilbert v Tauranga District Council EnvC Auckland A006/2003, 10 February 2003; Ladstone Holdings Ltd v Leonora Holdings Ltd [2006] 1 NZLR 211 (HC).

the Court of Appeal considered relevant to determining whether a drain is public or private include:

(a)for a drain on private property to be a public drain the requirement is control actually and consciously exercised by a local authority for a sustained period;

(b)the history of the drain, including whether it was constructed at public expense by a local authority and the intention in its construction and use;

(c)whether control and maintenance of the drain has been taken over by the local authority; and

(d)whether the drain is for the benefit of particular properties or for the benefit of the needs of a section of the public.

[34]   Applying those factors to this case, I consider the watercourse on Mr Tiller’s property would not be a public drain in a legal sense because:

(a)there is no evidence that the Council established the watercourse (discussed further below) and consequentially there is no evidence it was established for a public purpose;

(b)the watercourse is on private land and the Council has not exercised any active control or management over it for the almost 29 years that Mr Tiller has owned the property;

(c)while on one occasion the Council undertook some streambank works at Mr Tiller’s request, that act falls short of any active access, control or maintenance of the watercourse on private land; and

(d)the watercourse conveys stormwater via a natural streamflow path.

[35]   While the issue is one for the Court, Ms Gleeson’s evidence is that the watercourse is not a public drain. She was directly challenged on that issue in cross-examination and she maintained her position. Ms Gleeson’s was the only expert evidence on the issue.

[36]   The fact that Mr Tiller is concerned that stormwater flows have increased and have created flooding at higher levels, especially in the more recent storm events in 2023, this does not mean that the private drain has become a public drain.

[37]   Mr Tiller referred in his evidence to the Council having a consent to discharge stormwater. However, that is a consent to discharge stormwater into the sea at the end of the network. I do not consider that the existence of this consent to discharge stormwater into the sea converts the watercourse on the property to a public drain.

[38]   There is no easement registered on the title to the property as regards the watercourse. I do not consider the lack of an easement is of any moment. This was referred to in the joint statement of the two valuers as follows:

Mr Gamby is aware from valuing property on Auckland’s North Shore over many years that drainage easements are not commonly registered on properties where streams and watercourses and drains flow across residential land. Mr Swan has not investigated drainage easements on the North Shore; however, he suspects there are certain to be no drainage easements registered on the titles of many properties in Auckland where streams and watercourses cross the land.

Establishment of the watercourse: first alleged trespass

[39]   Mr Gilchrist, counsel for Mr Tiller, submits that the Council has directly interfered with Mr Tiller’s land by constructing a drain through the property. This is the first of the three alleged acts of trespass.

[40]   The difficulty with this submission is there is no evidential basis for it. There is no evidence as to who established the watercourse on the property or when that occurred.

[41]   There is evidence that at one time the property was (largely) a “seasonal swamp”. A report prepared by an Engineer and Surveyor consultancy for Mr Tiller in

2019 and produced in evidence states that the watercourse is within the alveus of the natural watercourse. The report defines “alveus” as the “bed or channel through which a stream flows when it runs within its ordinary channel”. The natural watercourse appears to have been the original drainage channel for the catchment.

[42]   The watercourse is classified as an “open watercourse” which means a natural or man-made open channel where water collects and flows. It appears from the evidence that the watercourse was constructed sometime between the 1940s and the late 1950s or the early 1960s. But importantly, there is no evidence as to who established the watercourse or exactly when in the period between the 1940s and the early 1960s.

[43]   Mr Tiller’s position, which he expressed in his evidence and under cross-examination is that the Council must have constructed the watercourse because it had (historical) available powers that would have enabled it to do so. The powers referred to by Mr Tiller are: ss 17 and 23 of the Land Drainage Act 1908 which enabled a council to construct and maintain drains and watercourses and to make drains from private lands and recover expenses from owners; s 265 of the Public Works Act 1928 which, subject to other provisions of that Act, gave the county council powers to do various things including to make new public drains and powers in respect of all drains; and s 163(d) of the Municipal Corporations Act 1954 which provided powers to erect, construct and maintain public works.

[44]   But the Court cannot infer, in the absence of any supporting evidence, simply because there were statutory powers available, that the Council must have constructed the watercourse.

[45]   The Court is, accordingly, unable to find that the Council established the watercourse. Accordingly, Mr Tiller is not able to prove this alleged act of trespass.

Use of the watercourse: second alleged trespass

[46]   Mr Tiller alleges the Council has used the watercourse to carry stormwater runoff from a wider area. Mr Gilchrist submits the Council is liable for trespass as this intrusion of excessive catchment stormwater onto Mr Tiller’s land was a necessary

or natural  consequence  of  the  Council’s  act  of  constructing  the  watercourse.  Mr Gilchrist further submits that this intrusion of excessive catchment stormwater onto Mr Tiller’s land was a necessary or natural consequence of the Council’s action as the discharge of stormwater through Mr Tiller’s land was the very purpose of the Council’s deliberate construction of the drain through the property. Accordingly, he says it must also be the necessary and natural consequence of the Council’s actions. Mr Gilchrist further says this intrusion continues to occur without any legal authorisation and to Mr Tiller’s detriment.

[47]   However, as I have already found, there is no evidence that the Council constructed the watercourse. So the Court must look to see if there are any other acts of the Council that have as their “necessary or natural consequence” the increased contact of stormwater with the property. I use the word “increased” advisedly as the Council does not have any direct control over the natural flow of stormwater from the catchment. I discuss this issue further under the doctrine of natural servitude.

[48]   Ms Gleeson’s evidence is that upstream of the property the watercourse remains open and runs through properties between Montana Avenue  and  Saddleback Rise. She also says that the watercourse is piped under McNay Way.

[49]   Mr Gilchrist refers to that piping and suggests this is an evidential basis to sustain the submission that the actions of Council have generated an increase in stormwater adding to what would otherwise be a natural flow. However, there was no assessment by an expert for Mr Tiller as to how the piping of water under McNay Way differs from or adds to the volume of water that travels through the watercourse across Mr Tiller’s property. There is no evidence that that particular part of the catchment generates new or artificial water (to use Mr Tiller’s phrase). There is no basis for the submissions made on behalf of Mr Tiller that the piping of water under McNay Way has contributed to what would otherwise be a natural flow of water.

[50]   Mr Gilchrist also submits the Council, in granting resource consents for the development of properties upstream of the property, has committed an act or acts that have as a necessary or natural consequence, the intrusion of stormwater onto the property. Mr Gilchrist refers to the approval of the Hauraki Estates subdivision in

1992, the upgraded road formation in 2001 with new sumps, kerbing and channelling and also infill housing. He submits this all increases what he says are “artificial discharges through the property”.

[51]   There are a couple of difficulties with that submission. First, Mr Tiller accepts that what flows through his property is  a  natural  watercourse.  The  valuer,  Richard Swan, who gave evidence on behalf of Mr Tiller, expressly accepted that this is a natural watercourse. In other words, there is a natural water flow through the property. There was no expert evidence called by Mr Tiller to make an analysis of an increased contribution (if any) to the natural watercourse caused by these various acts of the Council relied on by Mr Tiller and any increase over and above what would be a natural flow.

[52]   Second, there is no recognition on behalf of Mr Tiller of “natural servitude”, which I address in the next section of this judgment. That is the obligation that landowners have to receive flow from upstream properties.

[53]   Mr Gilchrist refers to the resource consent held by the Council to discharge stormwater into the sea at the end of the network. However, this does not make the Council responsible for all stormwater flows or rainwater across all aspects of the network as a whole. This is especially so when there is a naturally occurring flow through a natural watercourse.

[54]   Further, in terms  of  the  Council’s  role  as  a  regulator  under  the  Resource Management Act 1991, it is not responsible for the effects of activities undertaken by third parties which it authorises by granting resource consents under the Resource Management Act.11 When an activity is authorised by a resource consent, there is no basis for asserting that the authorisation by way of the consent, gives rise to an agency relationship between the consent authority and the consent holder. In other words, there is no act by the Council in granting an unspecified

11See Banora v Auckland Council [2019] NZDC 5184; Morrison v Upper Hutt City Council [1998] 2 NZLR 331 (CA); Bella Vista Resort Ltd v Western Bay of Plenty District Council [2007] NZCA 33, [2007] 3 NZLR 429; Swordfish  v  Buller  District  Council  [2012]  NZHC  1081,  (2012) 16 ELRNZ 839; Mawhinney v Waitakere City Council [2007] NZRMA 173 (HC) as confirmed in Mawhinney v Auckland Council [2013] NZHC 159.

number of subdivision consents for housing upstream of the property that has, as its necessary or natural consequence,  an increased  flow of  “artificial water” (to use  Mr Tiller’s term) through the watercourse. In any event, there is no technical evidence as to a causal link between any new development upstream of the property and increased stormwater flows on the property.

[55]   I have not overlooked Mr Gilchrist’s reference to Jacobs v Waikato District Council.12 However, the statements by the Court in that case were obiter as the claim was in nuisance, and the case was different on the facts.

Natural servitude

[56]   Mr Gilchrist submits that the Council has no defence under the doctrine of natural servitude. He refers to The Laws of New Zealand commentary for relevant legal principles:13

Lower land is subject to a natural servitude by which it is obliged to receive surface water which falls naturally from higher land ... The servitude extends to permit the owner of the higher land, in the natural use of that land, to concentrate and discharge onto the lower land water that would naturally fall there. What amounts to natural use is a question of fact, to be determined in each case with due regard to the whole of the surrounding circumstances.

(footnotes omitted)

[57]   Mr Gilchrist also refers to the commentary where it states limitations on the doctrine:14

The natural servitude is subject to limitations. The servitude does not permit the owner of the higher land to discharge onto the lower land water which the higher owner has by active collection brought from another watershed (that is, "foreign water''). Likewise, the servitude does not permit the owner of the higher land to cause damage to the lower land, which did not occur when that land received the natural flow, either by means of an artificial work or structure which makes the water flow onto the lower land in a way different

12 Jacobs v Waikato District Council, above n 9.

13 FM Brookfield The Laws of New Zealand Water (online ed) at [86]. See also reference to discussion in Peter Twist Hinde McMorland & Sim Land Law in New Zealand (online ed, LexisNexis) at [6.017] as discussed in Barron vLouw [2018] NZHC 2275, [2018] NZAR 1668 at [28]–[29].

14 At [87].

from before, or by using the higher land so that the result of such use is the discharge of water with altered concentration or velocity.

(footnotes omitted)

[58]   Mr  Gilchrist  quotes  the  following  further  extract  from  The  Laws  of  New Zealand:15

It has been held that the servitude gives the higher owner no right to require the lower owner to keep open a drain that has received water from the higher land. The latter owner's obligation, upon this basis, would be merely to allow the water as free passage as it would have were the land in its natural condition.

(footnotes omitted)

[59]   Mr Gilchrist submits the property is not obliged to receive surface water as the watercourse is an artificial construction, not a natural watercourse.

[60]   The difficulty with that submission is that, as I have already mentioned, history shows that the watercourse flows through an area of a seasonal swamp and Mr Tiller and Mr Swan accept there is a natural watercourse there.

[61]   As the above extract from The Laws of New Zealand says, the obligation of the lower owner is merely to allow the water free passage as it would have were the land in its natural condition. As I have already said, there was no expert witness called by Mr Tiller to assist the Court with evidence of any increased contribution to the natural watercourse by the various acts of Council including approval of a residential subdivision in 1992. Similarly, there is no evidence that any artificial works or structures on the higher land make the waterflow onto the lower land (that is the property) in a way different from before or by using the higher land so that the result of such use is the discharge of water with altered concentration or velocity.

[62]   In conclusion, there is no evidence that any of the alleged acts by Council have had as their necessary and direct consequence the increased flow of stormwater through what is a natural watercourse. In other words, there was no unreasonable interference with the property.

15 At [87].

[63]   Finally, as to any alleged trespass based on allegations that water from the watercourse flowed out of the watercourse and intruded onto the land itself, there is simply an absence of evidence as to the frequency, the volume of water, the amount of land that was covered by that floodwater and how long it was in place before it subsided. All of those factors would be relevant in terms of assessing whether there was a trespass from floodwater out of the watercourse onto the land itself.

Culvert not upgraded: third act of trespass

[64]   Mr Tiller’s position is that the Council, by not increasing the capacity of the culvert, has committed an act of trespass. He says that because of its inadequate capacity (known to the Council) the culvert causes water to pool behind the culvert. This pool then backflows and discharges onto his property.

[65]   To support that submission, Mr Tiller would need to point to evidence that the inaction of the Council in not carrying out those works directly interfered with the property. He has called no technical evidence that could support his assertion that the culvert in some way causes stormwater to flow 80 metres back upstream to his property and interfere with the land. Such expert evidence would need to address the size of the culvert and constraints on flows through it to directly assess the effects on the property. In particular, there was no technical expert evidence to demonstrate that the culvert was responsible for the inundation to the dwelling that occurred in the   27 January 2023 extreme weather event. Ms Gleeson’s evidence was that this storm event exceeded the 100 year annual recurrence interval.

[66]   There is evidence that surcharging at the culvert may occur and the stormwater may flow onto the road at that point, in heavy rain events. But there is no evidence that the surcharge would flow back to Mr Tiller’s property – nor the extent of such flowback for events of differing intensities. There is no evidential foundation on which to found a trespass in relation to this alleged act/inaction by the Council.

[67]   Even if the culvert had been upgraded, flooding may well have occurred in any event given the known propensity of the property for inundation (noted on the title at the time of the subdivision consent). In that regard I refer to the “buy-out scheme” put in place following the damage caused by the January 2023 Anniversary Weekend

floods to thousands of properties. That alternative relief, available to Mr Tiller, is discussed at [186] to [189] below. I mention it at this point because the technical report (detailed risk assessment) for the property concludes that future severe weather event risk cannot be mitigated by public infrastructure interventions. This provides support for a conclusion that undertaking a capacity upgrade of the culvert would not mitigate in any material way the flooding of the property in such extreme weather events.

[68]   Mr Tiller has not established a trespass by the Council by virtue of the Council not increasing the capacity of the culvert.

Limitation: trespass

[69]For completeness, I also address limitation issues raised by the Council.

[70]   The Council says that Mr Tiller’s claim in trespass is prevented by s 4 of the Limitation Act 1950 and s 11 of the Limitation Act 2010. The statutory limitation period of six years under each of the two statutes applies from the date that the acts or omissions which gave rise to the claim accrued. A cause of action accrues when every fact exists which would be necessary for a plaintiff to prove in order to support their right to the judgment of the Court.

[71]   Mr Gilchrist does not accept the Council’s argument. He submits that the trespass to land is an ongoing trespass in existence at the time the proceedings were filed on 27 April 2021. He says, in any event, since the commencement of the proceedings the habitable ground floor and garage were  inundated  with water on  27 January 2023. As a consequence the property was “yellow stickered” by the Council, preventing residential occupation. Again on 9 May 2023 the land (but not the house) was inundated by stormwater flow.

[72]   Mr Gilchrist submits the wrongful conduct has been continuous and is unremedied as at the present date. He submits the wrongful conduct involves the commission of a single act, not a series of actions that accrue separately and which are distinct from each other.

[73]   As to Mr Tiller’s knowledge, Mr Gilchrist submits that knowledge is not a defence to an action in trespass. In any event, Mr Gilchrist says Mr Tiller’s knowledge was to the effect that his property would be subject to inundation, not that the watercourse would be used for runoff from the wider area.

[74]   Mr Gilchrist also submits that for the purposes of limitation there is a difference between trespass to land or any other tort actionable per se and torts actionable only by proof of damage.16 Mr Gilchrist says, as a result, the time period for the plaintiff’s trespass claim applies only from the time the action fully accrues and it has not done so yet. He says, accordingly, Mr Tiller is not precluded from seeking mesne rent from the time of the acquisition of the property down to the present date as pleaded.

[75]   Mr Gilchrist refers to the judgment of Hardie Boys J in T v H where the Judge said:17

That the conduct may (and usually will) have caused continuing injury does not render the conduct a continuing wrong. The wrong ends and the cause of action fully accrues when the conduct ends. Continuing and future injury is compensated by damages, not by postponing accrual of the cause of action.

[76]   In the alternative, Mr Gilchrist submits that even if there is a statutory bar, Mr Tiller is entitled to recover his losses from six years prior to the issuing of the proceedings down to the date of judgment.

[77]   The various acts of the Council that are alleged to have as their necessary or natural consequences an increased water flow through the watercourse over and above that which would have occurred in any event, are all outside the limitation period in the two Limitation Acts:

(a)alleged installation by the Council of the watercourse at a date prior to 1995;

(b)flood events said to have occurred in 2000;

16     T v H [1995] 3 NZLR 37 (CA) at 41.

17     At 53.

(c)erosion to the streambank allegedly occurring in 2001 and 2006;

(d)slumping and undercutting of the watercourse bank said to have occurred in 2002;

(e)approval of a resource consent for an upstream subdivision in 1992; and

(f)the capacity of the culvert not being upgraded by reference to statements made by the Council in 2001, 2002 and 2012 (referred to in more detail in the second cause of action alleging breach of undertakings).

[78]   If the cause of action in trespass accrued as at those dates then the claim for trespass would be time barred.

[79]   Recently, admittedly in the context of a negligence case, in Whangarei District Council v Daisley the Court of Appeal said:18

[83]      As the United Kingdom Supreme Court explained in Jalla v Shell International Trading and Shipping Co Ltd, a continuing cause of action is one which arises from the repetition of acts or omissions of the same kind. That was a claim in private nuisance, which is actionable on the happening of loss, but the Court held that nuisance is in principle no different from any other tort or civil wrong in this respect. What matters is that the wrong is continuing on a daily or other regular basis. If so, the cause of action accrues afresh on a continuing basis. The cause of action does not continue merely because loss from the original wrong continues to accrue within the limitation period.

[84]      In a continuing breach case, the plaintiff may sue for loss suffered within the six-year limitation period, notwithstanding that the continuing wrong was first committed more than six years earlier and notwithstanding that the loss suffered within the limitation period is of the same kind. But damages cannot be recovered for occurrences of the wrong that happened more than six years before the claim was commenced. That is a corollary of the rule that successive actions lie for each successive accrual of damage. Applied to the facts here, the doctrine of continuing breach would allow    Mr Daisley to sue for profits lost or costs incurred after 14 August 2009 if the breach of duty was repeated after that date, but he could not sue for profits lost or costs incurred earlier as a result of breaches between 2004 and 14 August 2009.

18     Whangarei District Council v Daisley [2024] NZCA 161 at [83].

(footnotes omitted)

[80]   Applying that reasoning and the statement from the United Kingdom Supreme Court in Jalla19 — nuisance is in principle no different from any other civil tort or wrong — had there been any actionable claim in trespass (and I have found against that) due to the continued presence of the watercourse, the flow of stormwater through it and the flow of stormwater back through the culvert, the provisions of the Limitation Act 2010 mean that any mesne rent  should be limited to  the period of  six years prior to the claim being made (namely six years prior to 17 April 2021). In other words, Mr Tiller cannot seek damages for the entire period since he acquired the property.

[81]   That is subject to Mr Gilchrist’s further alternative argument on limitation. He submits that Mr Tiller is not barred from seeking mesne rent relief from 1995 to the present date as the relief sought is one for “rent”. He submits claims for rent or arrears in rent are subject to a separate regime under both Limitation Acts. He submits that both Limitation Acts provide that the limitation period with respect to damages or arrears in “rent” arise from the date on which the arrears become due. The Limitation Act 1950 provides:

19       Limitation of actions to recover rent

No action shall be brought to recover arrears of rent or damages in respect thereof, after the expiration of 6 years from the date on which the arrears became due.

[82]The Limitation Act 2010 provides:

16       Special start dates for various money claims

(1)… the primary and longstop periods of a claim specified in one of the following paragraphs have the start date specified in that paragraph:

(a)a claim for, or for arrears of, or for damages in respect of arrears of, interest or rent—the date on which the interest, rent, or arrears became payable:

…

19     Jalla v Shell International Trading and Shipping Co Ltd [2023] UKSC 16, [2023] 2 WLR 1085 at

[26] and [31].

[83]   Mr Gilchrist says at present the “rent” claim for the Council’s use and occupation of the property since 1995 is not “due” or “payable” as it is yet to be determined whether such “rent” is payable to Mr Tiller. He says the date on which rent for the Council’s occupation and use of the property falls due will be the date a judgment for mesne rent is issued by the Court. In other words, Mr Gilchrist says the date of judgment of this Court is the relevant date at which time any limitation under both Limitation Acts is assessed. I add that Mr Gilchrist candidly acknowledged he had not been able to locate any authority to support this proposition.

[84]   I do not accept Mr Gilchrist’s submission. First, the claim or action is not a claim or action to recover rent. The claim is based on the tort of trespass. Mesne rent is simply the relief.

[85]   As referred to in [149] below in a claim for trespass to land a plaintiff must make an election between damages to compensate for loss or damages for wrongful use (namely mesne rent). If Mr Gilchrist’s submission is correct, that would lead to the anomalous position whereby, if a plaintiff pursued damages as relief in a claim for trespass, the date of judgment would not be the date for the accrual of the cause of action, whereas if a plaintiff in a similar position elected to seek relief in the form of mesne rent, then the cause of action would not accrue until judgment. That simply cannot be right.

[86]   In summary, on the issue of limitation, had I found in favour of Mr Tiller on his claim in trespass, then any assessment for mesne rent would be limited to a period of six years prior to the filing of the statement of claim.

Second cause of action: breach of undertakings

[87]   Mr Tiller’s case is that the Council allowed damage to occur to the property by breaching each of six alleged undertakings that he says were given between 1 March 2001 and 17 December 2012. I will refer to the undertakings allegedly given by the Council using the neutral term “statements”.

[88]There are two issues to be determined:

(a)whether a claim for alleged breaches of the six statements is statute-barred;

(b)in the event that any of the alleged breaches are not statute-barred, are they the kind of statements that would found an action for breach of contract?

Limitation issue: breach of undertakings

[89]   Mr Tiller says the six statements relate to the Council’s position as regards the upgrading of the capacity of the culvert. In fact, as will be seen below when I discuss each of the individual statements: one is not a statement in respect of the culvert but is rather a statement about erosion; one is an information memorandum to keep property owners up to date; and one is in an affidavit in other proceedings involving Mr Tiller and the Council.

[90]   As  noted,  the  statements  were  made  between  15  February  2001  and   17 December 2012. Four of them were made prior to the end of December 2002.

[91]   All the works in relation to the culvert that the statements referred to were to be completed by the end of the 2012/2013 financial year at the latest. Accordingly, for any breach occurring by 30 June 2013 a claim needed to be filed by 30 June 2019 at the latest. The initial statement of claim was not filed until 27 April 2021. If the date for breach is 30 June 2013 then the cause of action for breach of undertakings is statute-barred by the Limitation Act 1950 in respect of the statements made prior to 2011 and the Limitation Act 2010 in respect of the statements made in 2012.

[92]   In the alternative, I respond to Mr Tiller’s position that the cause of action for breach of at least the sixth statement made on 17 December 2012, did not arise until Mr Tiller learned during a phone call on 13 October 2017 with the General Manager of Infrastructure and Environmental Services at the Council, that the project for works to upgrade the culvert had been cancelled.

[93]   If the cause of action for breach of undertakings accrued at that date, Mr Tiller would have had until 13 October 2023 to file his claim.

[94]   The history of the claim is that the initial  statement of claim  was filed  on  27 April 2021. The initial claim included a cause of action for breach of the six “undertakings” (as well as for trespass to land and nuisance).

[95]   However, the claim for breach of the six undertakings was dropped from the amended statement of claim filed on 24 February 2022. That claim contained two causes of action: trespass to land and nuisance.

[96]   It was not until 3 November 2023 when a second amended statement of claim was filed (this is the current claim) that the cause of action for breach of undertakings was reintroduced.   That cause of action had effectively been abandoned between   24 February 2022 until the second amended statement of claim was filed.

[97]   The issue is whether, in those circumstances, the claim for breach of undertakings is within time (if the cause of action accrued on 13 October 2017).

[98]   Mr Gilchrist says it is. He acknowledges this cause of action was dropped in the first amended statement of claim but says that the narrative background pleaded in that statement of claim nevertheless refers to each of the six alleged undertakings.

[99]   Mr Quinn, counsel for the Council submits, given the absence of any claim for breach of undertakings between 24 February 2022 and 3 November 2023, time must run from the filing of the second amended statement of claim on 3 November 2023. The cause of action is therefore out of time.

[100]   The starting point is r 7.77(2)(a) of the High Court Rules 2016, which relevantly provides:

7.77     Filing of amended pleading

(1)A party may before trial file an amended pleading and serve a copy of it on the other party or parties.

(2)An amended pleading may introduce, as an alternative or otherwise,—

(a)relief in respect of a fresh cause of action, which is not statute barred; or

…

…

[101]   The courts have interpreted this rule to infer that the opposite is also true, namely, that a fresh cause of action which is statute-barred may not be introduced in amended pleadings.20

[102]   Price Waterhouse v Fortex Group Ltd is the leading case for the principle that once an amended statement of claim is filed, the previous statement(s) of claim are no longer operative, and “in the eye of the law, it no longer exists.”21

[103]   In Walkers Nurseries Ltd v Carlile Dowling Associate Judge Faire was required to analyse each of the four statements of claim to determine whether a new cause of action had been pleaded in one of the amended statements of claim and in circumstances where that new cause of action was outside the limitation period.22

[104]   Having undertaken that analysis the Judge considered that the breaches alleged in the statement of claim and the amended statement of claim had been abandoned and replaced by a new breach. The fact that those allegations were raised in the third statement of claim, beyond the limitation period, meant they were out of time.

[105]   I return to Mr Gilchrist’s submission that the six alleged undertakings were all pleaded in the narrative  background in the first  amended statement of claim of     24 February 2022. In Attorney-General v Carter the Court of Appeal considered what amounted to a new or fresh cause of action so as to be caught by r 187(3), the predecessor to the current rule which was materially the same. The Court said:23

The circumstance that the underlying facts may be the same or similar does not save a cause of action from being fresh if the plaintiff seeks to derive a materially different legal consequence from those facts. Obviously matters of

20     Meates v Commercial Bank of Australia Ltd CA190/85, 11 March 1986 at 7–8 per McMullin J.

21     Price Waterhouse v Fortex Group Ltd CA179/98, 30 November 1998 at 17.

22     Walkers Nurseries Ltd v Carlile Dowling HC Auckland CIV-1994-441-57, 8 July 2004.

23 Attorney-General v Carter [2003] 2 NZLR 160 (CA) at [48]. See also Transpower New Zealand Ltd v Todd Energy Ltd [2007] NZCA 302 at [61] as to principles for determining whether a cause of action is fresh.

degree can be involved but here the position is plain. The plaintiffs’ breach of statutory duty causes of action have hitherto asserted negligence as an ingredient. Now they wish to assert liability without negligence.

[106]   I do not consider there are matters of degree in this case. Rather, the position is plain. In the amended statement of claim dated 24 February 2022, while the six undertakings are pleaded, they are relied on by Mr Tiller as part of the cause of action of trespass to land. It is pleaded that “the matters referred to at paragraphs 1 to 78 amount to the defendant trespassing on the plaintiff’s land”. Those paragraphs include the alleged undertakings. A claim of trespass to land is an entirely different cause of action from the cause of action based on the alleged breach of the said undertakings, which is effectively a claim for breach of contract. Further, the relief for each of the two causes of action, as amended in closing submissions, is entirely different.24

[107]   In conclusion, for the above reasons, even if, assuming in Mr Tiller’s favour that the breach date is 13 October 2017 rather than 30 June 2013, the claim for breach of undertakings sought to be reintroduced in the second amended statement of claim is statute-barred.

The six statements

[108]   In case I am wrong in my conclusion that the cause of action for breach of undertakings is statute-barred, I will go on to consider whether the six statements are in the nature of “undertakings” which could found a claim for breach of contract. I first set out each of the six statements together with Mr Tiller’s response when asked about the statements under cross-examination.

First statement: 1 March 2001

[109]   On 15 February 2001 Mr Tiller wrote to the Manager, Stormwater Services at the North Shore City Council about the culvert.

24     Refer [150]–[154] and [179] below.

[110]   In a letter in response dated 1 March 2001 the Stormwater Manager, Water Services, wrote as follows:

I have not been able to find any written record of why the project was not proceeded with during the 1995/96 Annual Plan period.

The project is identified in the draft Catchment Management Plan as a works needing to be carried out and as several properties are affected I have added it to our current list of projects being investigated, designed and consented. Council’s draft capital programme for 2001/02 for new stormwater projects is
$6,510,000, an increase on previous years. This figure cannot be confirmed until the Annual Plan process is completed in June 2001. Depending upon consent approvals, the project should be carried out in the 2001/02 construction period.

(emphasis added)

[111]   The letter concludes with an invitation to Mr Tiller to telephone the writer if any further information was required and a telephone number was provided.

[112]   In cross-examination it was put to Mr Tiller that the statement regarding the carrying out of the works was a statement that the works may be carried out. Mr Tiller agreed, saying: “Yes, it’s a conditional statement”.

[113]   Mr Tiller further acknowledged that he did not  respond  to  the letter until  16 months later by letter dated 23 July 2002.

Second statement: 5 September 2002

[114]   On 23 July 2002 Mr Tiller wrote to the Chief Executive of the North Shore City Council complaining that no works had been undertaken to upsize the culvert.

[115]   The written response on 5 September 2002 to Mr Tiller was from the Mayor. The letter includes the following paragraphs:

As Mr Frank Tian explained to you during the telephone conversations on    5 and 7 August 2002, upgrading the Lyons Avenue culvert was listed in the 1995/96 Annual Plan as a stormwater capital project. However, this project did not proceed due to the concerns raised during the design and consultation process. The major issue was that the enlargement of the culvert would simply transfer the flood problem and erosion to downstream properties. A catchment wide approach must be taken.

…

In the meantime, the design and consenting process of upgrading the Lyons Avenue culvert restarted in 2001, and we plan to carry out the physical works in 2003/04 financial year, subject to obtaining Auckland Regional Council’s consent.

(emphasis added)

[116]   Under cross-examination Mr Tiller accepted that the statement regarding carrying out the works was conditional on obtaining the Auckland Regional Council’s consent.

Third statement: 23 December 2002

[117]   On 2 December 2002 Mr Tiller wrote to the Manager, Stormwater Services, North Shore City Council regarding erosion which Mr Tiller said in his letter was occurring on the “streambank” running through his property.

[118]   The letter in response from the Stormwater Operations Manager, Water Services dated 24 December 2002 included the following:

A site inspection on 23 December 2002, made with yourself, shows a 4 metre approx length of slumping, towards the western end of your property, adjacent to several punga trees. Undercutting of the banks is occurring at various places along the length of the watercourse and although this may cause slumping in the longer term it is a natural process.

I have instructed our maintenance contractor to attend to the slumped 4 metre area, he will replace the slumped earth with a gabion basket and this will attend to your main area of concern.

[119]   Under cross-examination Mr Tiller acknowledged that the letter does not refer to the culvert. He added: “No, because it’s a different issue”.

Fourth statement: affidavit sworn 19 December 2002

[120]   In January 2003, Mr Tiller filed an application in the District Court for a declaration that the culvert was deemed an obstruction in terms of ss 511 and 512 of the Local Government Act 1974. He sought an order under s 513 for the culvert to be upsized or removed. In a judgment of 17 January 2003 a District Court Judge refused the application.

[121]   Mr Tiller relies on an affidavit filed by Fengming Tian, the Stormwater Project Engineer at North Shore City Council, who was then in charge of delivering all new and planned renewal stormwater projects. Various statements in that affidavit are as follows:

3.2 The Lyons Avenue culvert (also marked on the attached plan) was identified as being undersized and a stormwater capital project to enlarge the culvert was listed in the 1995/96 Annual Plan. However, this project did not proceed due to the concerns raised during the design and consultation process. The major issue was that the enlargement of the culvert would simply transfer the flood and erosion problem to downstream properties. A catchment wide approach was needed.

…

3.5As the Lower Taiorahi Stream Upgrade project involved several affected parties (Auckland Regional Council, community board, and individual landowners) the NSCC was not able to obtain the required resource consents until August 2002. Consequently, the Lyons Avenue project could not proceed in 2001/02.

3.6This project is now listed in the 2003/2004 Annual Plan and will be undertaken as soon as all necessary resource consents are obtained. …

3.7The process for obtaining resource consent has become more complex since the Lyons Avenue project was first proposed because of the ARC’s new Proposed Regional Plan: Air, land and Water (“proposed plan”).

3.8Enlarging an existing culvert is not a permitted activity under the proposed plan so resource consents are required from ARC to carry out the proposed work. …

3.9Land owner consents from the adjacent property owners will also be required to undertake works that affect these properties.

3.10In light of the above matters it is unlikely, therefore that the project will be completed before the 2003/04 financial year which ends on 30 June 2003. Rather, it is anticipated that the project will be completed after October 2003, provided the necessary consents and other approvals can be obtained.

(emphasis added)

[122]   Under cross-examination Mr Tiller agreed that the statement regarding the culvert upgrade works being completed was expressly subject to qualifications in terms of resource consents and other approvals being obtained.

Fifth statement: 12 April 2012

[123]   On 19 March 2012 Mr Tiller lodged a claim for compensation under s 80 of the Public Works Act 1981 by way of a letter to the Council, requesting the Council to purchase the property subject to agreement as to price. Mr Tiller followed up with a supplementary letter of 22 March 2012.

[124]   Mr Tiller received a reply in a letter dated 12 April 2012 from the Manager Acquisitions and Disposals, Strategy and Asset Planning Unit, Property. Regarding the claim for compensation, it was declined on the basis that even allowing for a six year extension on top of the initial two year period, the deadline for lodging the claim would have expired in 2007.

[125]As regards the culvert, the letter states:

I note however, that Council’s Infrastructure and Environmental Services Unit (IES) is keen to proceed with planned mitigation works. As such, IES are commencing a detailed design of proposed works to duplicate the culvert at Lyons Avenue (together with required related works). This process will be followed by full consultation with affected parties and a report to Hibiscus and Bays Local Board for their information.

[126]The letter concludes saying:

In summary, we are able to advise that subject to the granting of the requisite Resource Consents; physical works are programmed for the construction of the Lyons Avenue culvert, during the 2012/2013 financial year.

(emphasis added)

[127]   Under cross-examination it was put to Mr Tiller that the concluding words were a statement that works may be carried out but that was dependent on the consenting approvals being obtained. Mr Tiller responded: “Exactly.”

Sixth statement: 17 December 2012

[128]   On 17 December 2012, following a public meeting on 15 November 2012 (where an estimated 50 residents were in attendance), the Council sent out a public newsletter. It is headed: “Re: Lyons Avenue Culvert Upgrade Project – Newsletter Update”.

[129]   The letter records that residents raised concern regarding the downstream effects of the proposed upgrade and asked if additional options to mitigate the effects of the new culvert could be investigated further. The letter records that the Council agreed to further review additional downstream options including three possible options that were identified.

[130]The letter further states:

Council will report on these additional options over the next few months. Once this work is completed we will advise further on the next steps. At this stage, these steps include lodgement of a resource application for the Lyons Ave Culvert and associated downstream erosion protection works by the end of May 2013. If other alternative or additional options are to be pursued we will notify you of these.

[131]   The letter is signed by the Stormwater Manager, Stormwater Unit, Infrastructure and Environmental Services.

[132]   Under cross-examination Mr Tiller described the communication as “an information memorandum to keep people up to date”.

Submissions

[133]   Mr Gilchrist characterises the breach of undertakings as a claim for breach of contract.25 While Mr Gilchrist refers to all six statements he appears to place the greatest reliance on the fifth statement, the letter of 12 April 2012. He says a contractual relationship was established between the parties by way of the “undertaking” given by the Council to Mr Tiller in that letter where it was stated that the Council’s Infrastructure and Environmental Services Unit is “keen to proceed” with the mitigation works.

[134]   Mr Gilchrist submits that Mr Tiller’s acceptance of the Council’s “solution” (I take that to be a reference to an upgrade to the culvert) is evidenced by Mr Tiller not commencing legal proceedings against the Council. Mr Gilchrist submits that it is well-established that refraining from issuing proceedings or a forbearance to sue is sufficient consideration provided it is based on a reasonable claim that the party

25     Citing Holdfast NZ Ltd v Henkel KGaA [2007] 1 NZLR 336 (CA).

honestly believed in and bona fide intended to pursue. Mr Gilchrist says, accordingly, Mr Tiller’s acceptance of the Council’s solution included adequate consideration by not commencing legal proceedings.26

[135]   Mr Gilchrist submits the fact that Mr Tiller did not formally communicate acceptance of the defendant’s “solution” for the issues to be subject of the proposed legal proceedings is irrelevant. He says acceptance can be established by conduct.27

[136]   Referring to the two cases relied on by Mr Gilchrist, in Meates v Attorney- General the judgment of Cooke J contains the following:28

The real question in this part of the case is whether an implied contract can be spelt out of the words and acts of the parties. As indicated in Boulder Consolidated Ltd v Tangaere [1980] 1 NZLR 560 and having regard to the authorities there cited, I would not treat difficulties in analysing the dealings into a strict classification of offer and acceptance as necessarily decisive in this field, although any difficulty on that head is a factor telling against a contract. The acid test in a case like the present is whether, viewed as a whole and objectively from the point of view of reasonable persons on both sides, the dealings show a concluded bargain.

[137]   In the second case relied upon by Mr Gilchrist there is the following in the judgment of William Young, Glazebrook and Arnold JJ:29

A similar point was advanced in different terms by [counsel] in argument when he said that the appellants were not able to establish through clearly identified offers and acceptances the contracts of novation on which they rely. Considerations of this kind will often be very significant but given the course of conduct as a whole they are not controlling in the present case. In Brogden v Metropolitan Railway Co, Lord Hatherley concluded that a written agreement signed by one party and proffered to, but never executed by, the other was of contractual effect if:

... the course of dealing and conduct of the party to whom the agreement was propounded has been such as legitimately to lead to the inference that those with whom they were dealing were made aware by that course of dealing, that the contract which they had propounded had been in fact accepted by the persons who so dealt with them.

In the same vein are the comments of Cooke J in Boulder Consolidated Ltd v Tangaere:

26     Citing Cook v Wright (1861) 1 B&S 559, 121 ER 822 (QB).

27     Meates v Attorney-General [1983] NZLR 308; Savvy Vineyards 3552 Ltd v Kakara Estate Ltd

[2014] NZSC 121, [2015] 1 NZLR 281 (SC).

28     Meates v Attorney-General, above n 27, at 377.

29     Savvy Vineyards 3552 Ltd v Kakara Estate Ltd, above n 27, at [111].

But ... I would respectfully keep it in mind as a reminder that a mechanical analysis in terms of offer and acceptance may be less rewarding than the test whether, viewed as a whole and objectively, the correspondence shows a concluded agreement. On either approach the point of view of the reasonable man in the shoes of the recipient of each letter is of major importance.

(footnotes omitted)

[138]   I do not accept the contents of the six statements amount to contractual terms. First, Mr Tiller himself admitted that all of the statements that are said to constitute undertakings were conditional. Additionally, one is in an affidavit in District Court proceedings, one is not a statement regarding the culvert but it is a statement about erosion and the one is an information memorandum to keep people up to date.

[139]   I do not consider the statements in the Council communications evidence an offer by the Council and given Mr Tiller’s acknowledgement that the statements were all conditional, I do not consider that there was any intention to create a binding agreement. The statements made by the Council were as to potential future works that might occur but only if certain other events (for example funding, obtaining consents and neighbourhood consultation) occurred. I do not consider there was anything to elevate the statements beyond mere statements by the Council to consider options as opposed to a binding and enforceable undertaking. There was no certainty of term or intention by the Council.

[140]   As to the alleged acceptance of the “offers” by Mr Tiller and the submission made that in reliance on these statements he did not take legal action against the Council, that is not correct. On 1 April 2003 and on 9 September 2005 (the latter date is after the fourth alleged undertaking) Mr Tiller took steps and applied to the Council for consent for the grant of an extension of time to claim compensation from the Council under the Public Works Act 1981. In his 9 September 2005 letter Mr Tiller writes:

I have delayed proceeding to the Land Valuation Tribunal on account of an undertaking given to the District Court by Council to upgrade the culvert during the 2003/2004 financial year. However Council has not honoured that undertaking and as a result I wish to preserve my entitlement to claim compensation for injurious affection / injury.

[141]   On 12 October 2018 (after the sixth alleged undertaking) Mr Tiller appealed to the Land Valuation Tribunal for an extension of time to claim compensation. The Council applied for a strike-out. On 16 November 2018 Mr Tiller withdrew his appeal.

[142]   Further, and in any event, given the nature of the statements made by the Council, I do not consider it can be said Mr Tiller’s conduct amounted to an acceptance of a contractual offer.

[143]The second cause of action for breach of undertakings fails.

Remedies

[144]   In case I am wrong in my decision that Mr Tiller fails on both his claims, I turn to consider the remedies sought for both trespass and for breach of undertakings. I start with the remedies sought for trespass.

Non-monetary relief not pursued

[145]   There were two orders for non-monetary relief sought in the second amended statement of claim:

(a)an order granting an extension of time to Mr Tiller to claim compensation pursuant to the Public Works Act 1981 for a term of   six years commencing from the date of such order or commencing from 24 October 2017; and

(b)a declaration that at all material times and on transfer and registration of title of the property to Mr Tiller on 27 July 1995, there was never any equitable or legal easement registered or to be registered for drainage, conveyance of stormwater, or detention of waters on transfer and registration of title to Mr Tiller on 27 July 1995.

[146]   In his closing submissions the first order was not pursued. That was appropriate for a number of reasons: there was no legal basis advanced for this relief; an extension of time for a claim under the Public Works Act has already been litigated

by Mr Tiller, including by way of an appeal to the Land Valuation  Tribunal (subsequently withdrawn by Mr Tiller); the Public Works Act only applies to the “acquisition or taking of land for a public work” and the Council has not acquired or taken any of Mr Tiller’s land under the Public Works Act for a public work for which compensation for injurious affection could be claimed, nor has Council constructed a public work.30

[147]   In closing, Mr Gilchrist’s position in regards the declaration was that the Court did not need to address this issue. In the event that the Court determined there had been a trespass then Mr Gilchrist indicated this issue could be dealt with in the future.

Monetary relief not pursued

[148]   As well as a claim for mesne rent for trespass, which I  will come  to next,  Mr Tiller also claimed in the statement of claim:

(a)the sum of $1,850,000 (inclusive of chattels and GST (if any)) plus such further sums as Mr Tiller is able to prove at trial for the taking or acquisition of all of his interest in the property; and

(b)damages for deprivation of fundamental ownership and ability to sell the property (between 27 March 1995 to 26 April 2021) in the sum of

$4,479,100, and for such further sums accruing from 27 April 2021 to the date of taking.

[149]   In the course of closing submissions Mr Gilchrist accepted the proposition put to him by the Court that in a claim for trespass to land a plaintiff must make an election between damages to compensate for loss on the one hand (loss suffered at the hands of the tortfeasor) and damages for wrongful use (based upon a user principle).31    Mr Tiller, accordingly, abandoned the above two monetary sums sought and elected to proceed with his claim for mesne rent, to which I now turn.

30     Public Works Act 1981, s 60(1)(b). See definition of public work in s 2.

31Waugh v Attorney-General [2006] 2 NZLR 812 (HC) at [53] citing Roberts v Rodney District Council [2001] 2 NZLR 402 (HC) at [25]–[27].

Claim for mesne rent

[150]   The approach to determining the quantum of mesne rent was expressed by Cooper J in Waugh v Attorney-General as follows:32

What is necessary in each case is that the Court ascertains what it is that the defendant would have been prepared to pay to purchase a right allowing him or her to commit the act of trespass on which the plaintiff relies.

[151]   Mr Gilchrist submits that the question for determination in this case is what the Council would have been prepared to pay to purchase a right to permit the cutting of the watercourse through the property for the purpose of draining the seasonal swamp and the conveyance of stormwater through the watercourse. As well, he adds into the calculation what the Council would have been prepared to pay to purchase a right to permit the discharge of stormwater from the culvert due to the overflow back onto the property because of the under-capacity of the culvert.

[152]   Mr Gilchrist submits that Mr Tiller is entitled to relief in the form of mesne rent calculated on an annual basis from the date of the acquisition of the property on 27 July 1995 and otherwise on the basis as calculated in Mr Swan’s report.

[153]   The relief for mesne rent as set out in the second amended statement of claim is as follows:

(c)Mesne rent from 27 July 1995 to 26 April 2021 as follows: i) Drainage: $2,832,500;

ii)Stormwater: $3,605,000;

iii)Detention:

A.As Vacant Land Pre-Development (27 July 1995 to 26 March 1998): $333,750;

B.As Developed with new Dwelling (27 March 1998 to present):33 $5,265,125.

32At [63]. See also Queenstown Central Ltd v Marsh Construction Ltd [2016] NZHC 1884, (2016) 18 NZCPR 71 at [248]–[249]; Inverugie Investments Ltd v Hackett [1995] 1 WLR 713 (PC) at 718; and Attorney-General v Blake (Jonathan Cape Ltd third party) [2001] 1 AC 268 (HL) at 278.

33The reference to “present” I have taken to be 26 April 2021 given that is the date in the heading  and also given paragraph (c)(iv) seeks further sums accruing from 27 April 2021 for each of the three alleged easements for drainage, stormwater and detention.

iv)Judgment for such further sums as accrue from 27 April 2021 down to the date of taking by Proclamation, Gazette Notice or Registration of each of three easements for Drainage, Stormwater and Detention, or the taking of the entire property by the Defendant in lieu of the subject easements.

[154]The total amount for mesne rent claimed to 26 April 2021 is accordingly

$12,036,375. Averaging that sum over the period of the claim, namely 25 years and nine months, the average annual amount is $467,432.03.

[155]   There are a number of issues with the quantum claimed. First, there is no evidence as to the amount that might have been paid to establish the watercourse. The only evidence as to the value of the property, as an empty section, is Mr Tiller’s evidence that he purchased it for $85,000.00.

[156]   As to the use of the watercourse the amount of the claim purports to be based on the evidence of Mr Swan who calculated the value of mesne rent in three categories:

(a)land drainage easement: this is said to be an annual rental for the right to excavate and create an open channel in order to convey catchment drainage entering the property via the west boundary and exiting via the east boundary;

(b)stormwater drainage easement: this purports to be an annual rental for the right to discharge catchment water into the open drainage channel and at times beyond the banks of the channel entering the property via the west boundary and exiting via the east boundary;

(c)detention in two parts as follows:

(i)an annual rental for the right to use the property for a stormwater detention pond by detaining stormwater in any event equal to or greater than 1 in 10 requiring the right to inundate total title area exclusive of improvements based on flood levels calculated to occur in a 1 in 100 year storm (to apply to the period the land

was vacant before the construction of the new dwelling, namely from 27 July 1995 to 26 March 1998);

(ii)an annual rental for the right to use the property for a stormwater detention pond by detaining stormwater in any event equal to or greater than 1 in 10 requiring first, the right to inundate the total title area, and second, the right to inundate the non-habitable floor (the garage) and the habitable floors of the dwelling based on flood levels calculated to occur in a 1 in 100 year storm (reflecting construction of the new dwelling from 27 March 1998).

[157]   Each of the amounts calculated by Mr Swan under the four categories above ((a), (b), (c)(i) and (c)(ii)) is calculated on an annual basis. Annexed to this judgment are the two pages containing Mr Swan’s calculations (Annexure 2).

[158]   Mr Swan then did a further calculation adding one percent for each of the two “trespass reviews” (to use his term) for 2 February 2023 and 19 May 2023. The two reviews represented the flooding to the property on 27 January 2023 and an alleged inundation on 9 May 2024.34 The addition of a further two per cent gives a derived rate of 9.5 per cent as opposed to a derived rate of 7.5 per cent (without the two trespass reviews) for the land drainage easement as seen in Annexure 2. For the stormwater drainage easement the derived rate becomes 12 per cent instead of 10 per cent; and for detention, the derived rate becomes 11 per cent instead of nine per cent.

[159]   However, the amounts claimed in the second amended statement of claim, although purporting to be based on Mr Swan’s calculations do not match either his annual calculations without the trespass review or with the trespass review multiplied by the period of the claim. The following table based on the claim period of 25 years

34The date of 9 May 2024 may be incorrect having regard to Mr Tiller’s evidence that the event was on 9 May 2023.

and nine months (25.75 years) for drainage and stormwater easements and two separate periods for detention: one from 27 July 1995 to 26 March 1998 and the second from 27 March 1998 to 26 April 2021, illustrates the point:

As claimed	Using Mr Swan’s annual calculations without 2% trespass review (Annexure 2)	Using Mr Swan’s annual calculations with 2% trespass review
Drainage	$2,832,500.00	$2,027,812.50	$2,568,562.50
Stormwater	$3,605,000.00	$2,703,750.00	$3,244,500.00
Detention (vacant land)	$333,750.00	$251,370.00	$307,230.00
Detention (with dwelling)	$5,265,125.00	$3,738,960.00	$4,569,840.00
Total	$12,036,375.00	$8,721,892.50	$10,690,132.50

[160]   In his closing submissions, Mr Gilchrist adopted Mr Swan’s annual calculations for drainage and stormwater without the extra two per cent for trespass review (as set out in Annexure 2) but without explanation as to the basis for adopting those figures (rather than those which included the trespass review). For the two periods of detention Mr Gilchrist adopted the figures as claimed in the second amended statement of claim. Accordingly, as the case was put in closing, the total claim would be $10,334,437.50.35 To that sum there is added “such further sums as accrue from 27 April 2021” (refer (c)(iv) in [153] above) and interest from 27 July 1995 to the date of judgment.

35     The figure of $10,334,437.50 is calculated as follows: $78,750 x 25.75 ($2,027,812.50) plus

$105,000 x 25.75 ($2,703,750.00) plus $337,750.00 plus $5,265,125.00.

[161]   Ms Manohar, who argued this part of the case for the Council, while acknowledging mesne rent can be part of an award in trespass, submits that the rental calculation itself equating to an average annual rental of approximately $467,432 for the period of the claim is unsupportable on the evidence and legal principles.

[162]   The ultimate aim in setting the amount of mesne rent is to arrive at a sum which reflects the overall justice of the case.36

[163]   Mr Gilchrist relies on the judgment of the High Court in Waugh v Attorney-General.37 In that case the Court was required to consider the appropriate rental for a tunnel under the plaintiff’s property. The Court considered that the right in question could not legitimately be assessed on the basis that there was a market value for it and accordingly, the valuation depended on considerations unique to the land and parties. The Court held that the plaintiff could elect to seek damages for loss sustained or on the basis of the benefit derived by the defendant from the wrongful act of trespass. It was necessary to ascertain what the defendant would have been prepared to pay to purchase the right.

[164]   Further, while a rental for the whole of the property was used as the starting point for ascertaining the upper limit of the amount that would have been paid, it was discounted by 75 per cent to recognise that the tunnel was underground. The total amount awarded in that case was $118,220 together with interest, which covered a period of 8.34 years.

[165]   While purporting to rely on Waugh the approach by Mr Tiller in this case does not follow the approach in Waugh.

[166]   Mr Swan accepted that he had not calculated the mesne rent based on the rental of the actual property (the building or the land). Mr Swan said he based his calculation of mesne rent based on his review of the “case law”, not having calculated a mesne rent previously. However, while Mr Swan calculated an annual rental (as per the table in Annexure 2) the approach Mr Tiller has adopted of multiplying the annual rent that

36     Queenstown Central Ltd v March Construction Ltd, above n 32, at [255].

37     Waugh v Attorney-General, above n 31.

Mr Swan calculated by the number of years in the claim period, was not an approach set out in Mr Swan’s evidence.

[167]   Mr Swan acknowledged that the annual rental was calculated on the basis of the derived rate percentage of his  present  day  valuation  of  the  whole property. Mr Swan did not adjust the annual rental over the period of the claim as is apparent in the following cross-examination:

Q.       And that in multiplying the annual rental that you’ve calculated by

25.75 years for the claim period, makes no attempt to adjust the value over the claim period?

A.       That's correct.

Q.But you accept there would have been market different over that period?

A.       I accept that, yes absolutely.

Q.For example, post the global financial crisis in 2008 there were marked differences in that period?

A.Yes, property values have – from the point of 95 have climbed and dipped and dropped and increased sharply, so yes, I agree.

Q.I’m not sure if you were in [sic] present in court yesterday but Mr Tiller gave evidence that he purchased the property in 1995 for

$85,000?

A.       Yeah, I was in court, and I heard that.

Q.I take it that that original purchase price has not been calculated into your (inaudible 11:21:51).

A.       No, it has not.

Q.So, in light of that, would you consider that an annual rental in 1995 of nearly $500,000 is reasonable? In light of that purchase price?

A.In 1995, no I don’t, I think it would be totally excessive.  I might just add the reason I did, I was instructed to assess the value of the property as at the date of valuation.

Q.       I accept that.

A.       Yep, thank you.

Q. You’d also agree, you’ve just  said totally excessive, but that  value  would not realistically have been what would have been paid for a rental in 1995?

A.If it was based on the value of the property in 1995 and based on my percentages, no it would not.

Q.       So, not realistic?

A.       If the valuation was assessed in 1995.

[168]   Mr Swan also accepted that the calculation of mesne rent had not been adjusted to reflect that the watercourse was only on a small part of the property.

[169]   I consider an allowance for all the above issues would involve significant adjustments to the sum claimed. In short, there has been no attempt by Mr Tiller to provide an evidential basis for a sum that represents what the trespasser would have reasonably paid. Simply multiplying the present day values (leaving aside other issues with those values which I will come to) by the number of years in the claim does not accord with the approach in Waugh and, as is apparent from the above cross-examination, is not an approach advanced by Mr Swan.

[170]   I also note Mr Gamby’s evidence that the land drainage, stormwater drainage and detention mesne rent of $78,500, $105,000 and $162,000 respectively per annum since 1998 are out of proportion to his assessed per annum net rental for the whole property (land and dwelling) of $40,000–$45,000 at the present day.

[171]   Mr Gilchrist attempted to find an evidential basis in a letter dated 14 December 2018 and its annexures from Thurlow Consulting Engineers and Surveyors Ltd dated 14 December 2018 to Mr Tiller. The letter contains a cost estimate of $8,700,000.00 (GST inclusive) for “tunnelled pipe options for the lower Taiorahi stream works” commencing on or about 31 March 2019. There are a number of difficulties with that letter including: it is hearsay – Mr Thurlow was not called as a witness; and it is not clear from the letter exactly what the scope of the works would be. Accordingly, I put that letter to one side.

[172]   Not only are there issues with the general approach adopted as discussed above, there are also specific issues with the rental calculation advanced by Mr Tiller. First, Mr Swan applies a one per cent to his rental calculation for a land drainage easement and stormwater drainage easement due to “severance”. That is because part of the property at the rear is severed because of the watercourse. But the severance

occurred prior to Mr Tiller’s purchase of the property and the purchase was with knowledge of that severance. I consider that the severance is the result of the presence of the watercourse (that appeared to be accepted by Mr Swan) rather than its function. The pre-existing watercourse caused the severance.

[173]   A further issue is that there is duplication as between the land drainage easement and stormwater easement. The former is said to be for the excavation and creation of the watercourse. This is a one-off event. The latter is for the discharge of catchment stormwater into the watercourse. I do not consider that both can be applied together across the same time period.

[174]   In a similar way, both the stormwater drainage easement and the stormwater detention rental are applied to the area of land that the stormwater passes over. I do not consider both can be applied for the same time period.

[175]   Next, the land drainage easement relates to the right to excavate and create the watercourse. That activity occurred prior to Mr Tiller purchasing the property. Given the one-off nature of the asserted right, I do not consider it can be a relevant rental rate that Mr Tiller can recover.

[176]   In summary, I have considered the relief for mesne rent in case I am wrong in my decision that there was no trespass. However, as is apparent, there are a number of issues with the claim for mesne rent not the least of which is that there is no evidential foundation for simply adopting Mr Swan’s current values and multiplying them by the number of years in the claim period. That was not an approach advanced by Mr Swan. As discussed, there are also other issues with Mr Swan’s calculation.

[177]   On the basis of the evidence as it stands, Mr Tiller has not adduced evidence to enable the Court to calculate what would have been an appropriate mesne rent had there been a trespass. In the end, because of my finding there was no trespass, it is not necessary for the Court to arrive at an appropriate figure. What can be said though is that the sums for mesne rent in the second amended statement of claim of 3 November 2023 and as adjusted in closing submissions, are excessive and without a proper foundation.

Remedies – breach of undertakings

[178]   The relief for alleged breach of undertakings in the second amended statement of claim is precisely the same as the relief sought for trespass. None of the relief pleaded is the kind of relief that would be given in a successful breach of contract claim.

[179]   Mr Gilchrist accepted in closing that where the claim is essentially for breach of contract, mesne rent would not apply. He impliedly accepted that none of the other pleaded relief would be available as he submitted that the damage would be the loss that would ordinarily flow from the breach, namely the diminution in value of the property. It seemed to be assumed that the loss flowed from the alleged breach would be recoverable. But this point was neither pleaded nor developed in argument.

[180]   Mr Gilchrist acknowledged that while the value of the property was pleaded to be $1,850,000, the evidence from both Mr Swan and Mr Gamby was as to lower figures.

[181]   Mr Swan’s current valuation is $1,800,000 being a land value of $1,050,000 and improvements of $750,000. Those figures did not take into account the existence of the watercourse. Under cross-examination, and allowing for the existence of the watercourse, Mr Swan adopted a value of $1,575,000.

[182]   Mr Gamby assessed a market value (not subject to flooding to the dwelling) was $1,800,000 (land at $950,000 and improvements at $850,000). Allowing for “stigma” having regard to the fact that the dwelling had flooded, Mr Gamby’s evidence was that that would impact the price by $200,000, all of which is a current loss to improvements. Accordingly, Mr Gamby’s market value “as is” was $1,600,000.

[183]   Mr Gilchrist accordingly submitted that the appropriate sum for an award of damages is the diminution in value of the property as a result of the breach of contract/undertakings. This would be $200,000 if Mr Gamby’s evidence was adopted or $225,000 if Mr Swan’s evidence was adopted.

[184]   There is no particular reason for the Court to adopt either one or the other and in those circumstances I would adopt the figure of $212,500 being the midpoint between the two. But that would be subject to Mr Tiller establishing that the loss flowed from the breach (if established) and any deductions for other contributions (if any).

[185]   This is all academic, however, as I have found there was no breach of undertakings as claimed.

Alternative relief available to Mr Tiller

[186]   Mr Tiller has failed in his two causes of action in this proceeding but that does not mean he is without a remedy. Separate from this proceeding is the buy-out scheme that the Council is administering on behalf of the Crown and the Council, following the significant damage caused by the January 2023 Auckland Anniversary Weekend floods to thousands of properties across Auckland.

[187]   Mr Tiller could accept the voluntary buy-out being offered by the Council and the Crown due to the technical assessment of the property as being “Category 3” namely a residential property where future severe weather event risk cannot be sufficiently mitigated and creates an intolerable risk to life.

[188]The main elements of the scheme are as follows:

(a)The buy-out is a limited, one-time scheme made possible through a joint funding agreement between Auckland Council and the Crown.

(b)The buy-out does not indicate an admission of any civil liability by the Council or the Crown for any of the flooding that occurred in 2023 to any property in Auckland.

(c)As already referred to in [67] above, the technical report concludes that future severe weather event risk cannot be mitigated by public infrastructure interventions in relation to this property.

(d)The price the Council and the Crown will offer in the buy-out is based on a pre-weather event valuation (as at 26 January 2023) less any insurance settlement and less a homeowner contribution. The valuation would take into account that the property was located in an overland flow path/flood plain.

[189]   Under cross-examination, Mr Tiller confirmed that he would not engage with the Council, including for the purpose of discussing the way in which his insurance pay-out would be applied or credited towards a buy-out offer. Mr Tiller may wish to reflect on that position.

Result

[190]   Mr Tiller’s claims against the Council for trespass and breach of undertakings fail.

Costs

[191]   I did not hear submissions on costs. Accordingly, costs are reserved. The Council as the successful party is prima facie entitled to costs. If the parties can agree costs, a joint memorandum is to be filed no later 20 working days from the date of this judgment.

[192]   If the parties cannot agree costs, the Council is to file and serve its memorandum within five working days of  the  date  for  the  joint  memorandum. Mr Tiller is to file and serve his memorandum no later than five working days from the date of service of the Council’s memorandum.

[193]   Costs memoranda should not exceed five pages (excluding attachments). I will determine costs on the papers.

Gordon J

Annexure 1

Annexure 2

3.VALUATION: MESNE RENTAL — DETENTION

We assess and apportion annual mesne rentals on the following basis.

•          Base Rate  6.5%

•           Plus - suitability of the land for detaining stormwater       2.5%

Derived Rate

9.0%

(A)     As Vacant Land Pre-Development (27.07.1995 to 26.03.1998 - 2 years 8 months)

Value of Improvements

Land Value

$1,050,000 @ 9.0%

MESNE ANNUAL RENT AS VACANT LAND

NIL

$1,050,000

$   94,500

$   94,500

incl. G9T if any

(B)     As Developed with new Dwelling - (27.03.1998 to the presen! T

MESNE ANNUAL RENT FOR DEVELOPED PROPERTY $ 162,000

incl. GST if any