Watters v Mirkin
[2025] NZHC 2475
•29 August 2025
IN THE HIGH COURT OF NEW ZEALAND NELSON REGISTRY
I TE KŌTI MATUA O AOTEAROA WHAKATŪ ROHE
CIV-2025-442-019
[2025] NZHC 2475
UNDER sections 326–328 of the Property Law Act 2007 BETWEEN
CARL JOHN ARNOLDUS WATTERS AND LEAH HELEN GIBSON
Plaintiffs
AND
MARK DAVID MIRKIN
First Defendant
AND
ARTHUR BRUCE WIN and DEBRA MARGARET WIN
Second Defendants
Hearing: 11 August 2025 Appearances:
S J Zindel and M A Gauler for Plaintiffs G J Praat for First Defendant
M J Logan for Second Defendant
Judgment:
29 August 2025
JUDGMENT OF GRICE J
Introduction
[1] The plaintiffs seek an easement under s 328 of the Property Law Act 2007 (the Act) over the farmland owned by the first defendant and second defendants. The plaintiffs’ land is landlocked.
[2] The easement is sought over a gravelled accessway of approximately 5 m in width (the farm track). The farm track runs, primarily, over the first defendant’s property. It also crosses over a portion of the second defendants’ property. The farm
WATTERS v MIRKIN [2025] NZHC 2475 [29 August 2025]
track has been used by the plaintiffs for pedestrian and vehicular access to their house which is a converted barn. Tensions developed between the plaintiffs and Mr Mirkin, the first defendant over the use of the farm track. This cumulated in an urgent application to this Court and interim orders granting temporary access to the plaintiffs over the farm track.
Interim position
[3] The background to the claim is set out in the interim judgment granting temporary access over the farm track:1
[2] The plaintiffs’ rural property on Win Valley Road in Dovedale, Nelson is landlocked in practical terms. There is provision for legal access to the property through a paper road. However, the road has never been formed and the route over which it travels is essentially unusable without considerable expenditure. The plaintiffs, and the previous owners of their property, have for many years accessed their property through a flat and gravelled accessway from Win Valley Road, of about one kilometre in length, which runs over the properties of the first and second defendants.
[3] The first defendant believes that the plaintiffs’ use of their land has intensified in more recent times, placing increased demands on the access route through his land. He wanted the terms of access over his land to be formalised. He provided a draft licensing access agreement to the plaintiffs in May 2024. Its terms were not agreed. An updated agreement was provided by the first defendant to the plaintiffs later in the year. It was signed by the plaintiffs on 20 December 2024 – they say on a without prejudice basis to enable them access temporarily against the threat by the first defendant of the issue of a trespass notice. It was designed, the plaintiffs say, to provide a temporary solution over the summer break while a more permanent solution could be negotiated, or proceedings filed. However, disharmony continued. The first defendant says that the plaintiffs failed to comply with the terms of the agreement by failing to pay the agreed monthly fees for access, by failing to shut gates and, moreover, by removing gates and causing damage to fences.
[4] On 20 January 2025, the first defendant terminated the licence agreement and served a trespass notice on the plaintiffs. Criminal proceedings were then commenced against each of the plaintiffs under the Trespass Act 1980.
[5] In April 2025, the plaintiffs filed this proceeding and sought an interim injunction on a Pickwick basis. The interim injunction application sought, essentially, an order under s 328 of the Property Law Act 2007 under which a court may grant reasonable access to landlocked land. (footnotes omitted).
1 Watters v Mirkin [2025] NZHC 1040 at [2]–[5].
[4] An interim order for access was granted according with the following conditions:2
(a)The plaintiffs are to pay the first defendant a monthly access fee of
$50 (including GST) per month – to be paid on the 20th of each month, time being of the essence.
(b)Interest will accrue on any overdue payment at the rate of 15 per cent per annum calculated on a daily basis from the date on which the payment falls due to the date of payment.
(c)If the plaintiffs want a heavy vehicle – being a vehicle or trailer that weighs more than 3.5 tonnes – to use the accessway, then they are to use their best endeavours to give the first defendant 48 hours’ notice of that use and are to use their best endeavours to secure the first defendant’s consent to that use in advance. Consent is not to be unreasonably withheld. If 48 hours’ notice is simply not possible, then the plaintiffs are to notify the first defendant of the intended use (or, if unavoidably the use has already occurred, of the actual use) as soon as possible.
(d)All gates along the accessway must be left closed at all times.
(e)The plaintiffs are responsible for all foreseeable injury, loss or damage that may arise from their use of the accessway.
(f)The plaintiffs’ friends, family and people making standard deliveries for the plaintiffs (such as couriers, tradespeople and contractors) may use the accessway on the basis that the plaintiffs remain liable for foreseeable injury, loss or damage that is caused by them.
[5] Mr Mirkin says that the plaintiffs have breached conditions of the interim order, particularly those relating to closing the gates. The plaintiffs deny those breaches and say they are being targeted by Mr Mirkin. The plaintiffs and the first defendant each allege the other has engaged in harassment.
Relevant law
[6] The present application seeks an order by the Court to access the landlocked land by way of easement under s 327 of the Act. At the hearing, Mr Zindel, counsel for the plaintiffs, abandoned a claim seeking equitable relief.
2 At [21].
[7] Section 327(1) of the Act enables the owner or occupier to apply for an order under s 328(1) granting “reasonable access” to “landlocked land”. Section 326 defines those terms as follows:
landlocked land means a piece of land to which there is no reasonable access.
reasonable access in relation to land, means physical access for persons or services of a nature and quality that is reasonably necessary to enable the owner or occupier of the land to use and enjoy the land for any purpose for which it may be used in accordance with any right, permission, authority, consent, approval, or dispensation enjoyed or granted under the Resource Management Act 1991.
[8] The Court may make an order for (among other things) an easement for the benefit of the landlocked land.3 In determining an application for an order under s 328, the Court must have regard to the following factors set out in s 329:
(a)the nature and quality of the access (if any) to the landlocked land at the time when the applicant purchased or otherwise acquired the land:
(b)the circumstances under which the land became landlocked:
(c)the conduct of the parties, including any attempts they have made to negotiate reasonable access to the landlocked land:
(d)the hardship that would be caused to the applicant by the refusal of an order, in comparison with the hardship that would be caused to any other person by the making of an order:
(e)any other relevant matters.
[9] Section 330(1) provides criteria for the types of conditions the Court may impose in making an order for reasonable access. These include payment of reasonable compensation by the applicant to any other person;4 the exchange of any land between the applicant and any other person;5 and the execution of any instrument or the doing of any other things necessary to give effect to the order.6
[10] Section 331 states that the applicant must meet any reasonable cost of any work necessary to give effect to an order under s 328. The Court may make an order, having
3 Property Law Act 2007, s 328(1)(a)(ii).
4 Section 330(1)(a).
5 Section 330(1)(b).
6 Section 330(1)(g).
regard to the conditions under s 330(1) if it considers it just and equitable, requiring any other person to pay the whole or any specified share of the cost.
[11] In Re Pennington Trust Company Ltd, the applicants sought to legalise a right of way they had used for years.7 They wished to sell their property, but the lack of a legal right of way would make the property virtually unsaleable or the price would be significantly reduced. The Court was satisfied that the property was landlocked.8 It noted the applicants did not have reasonable access due to the lack of a legal right of any kind. The Court considered the following mandatory considerations under s 329:9
(a)The nature and quality of the access at the time of purchase: the Court noted there was physical access but an absence of a legal right. The application sought to remedy the absence of a legal right of way, rather than the absence of physical access.
(b)The circumstances of the lack of access: these were uncertain but may have dated back to an oversight in or after 1881 when the right of way was created.
(c)The conduct of the parties: this was irrelevant as reasonable access had been available on a de facto basis for many decades.
(d)Potential hardship: if the legal access was not granted, the applicants had a virtually unsaleable asset. However, the only hardship to one of the owners of the right of way was the obstruction of parked vehicles and damage to the concrete surface of the right of way. These assertions were considered insufficient or irrelevant.
[12] The Court ordered reasonable access over the right of way in favour of the applicants upon the terms of the covenants implied in a grant of vehicular right of way contained in s 297 and sch 5 of the Act.
7 Re Pennington Trust Company Ltd [2022] NZHC 2332, (2022) 23 NZCPR 556.
8 At [34].
9 At [37]–[43].
Issues
[13]The issues I must determine are as follows:
(a)whether the land is landlocked;
(b)having regard to the factors in s 329, whether the Court should exercise its discretion to grant an order for relief; and
(c)if so, what conditions should be imposed, including the payment of any reasonable compensation by the plaintiff.
Whether the plaintiffs’ property is landlocked
[14] The “paper road” which provides legal access to the property only gives theoretical access to the plaintiffs’ property. The paper road is owned by the Tasman District Council (the Council). It is about 10 m wide and runs roughly parallel to the farm track. While the paper road gives access to the plaintiffs’ property, it does not adjoin to their property.
[15] The owners adjoining the paper road, Arthur and Debra Win, use the paper road for grazing. Mr Verrall, the expert surveyor called by the plaintiffs, says that local authorities often allow grazing of such paper roads and other council property to keep the grass down. In this case, the grazing is without charge.
[16] Both the farm track and the paper road are in excess of 500 m long.10 The property is rural, and stock are run on it. The farm track runs through a working paddock on Mr Mirkin’s property. It also runs through approximately 75 m over an area of the Wins’ property largely unused for farming purposes.
[17] The plaintiffs’ property is zoned Rural 2 in the Tasman District Council plan. It has a dwelling on it and the property is used for farming activities. The plaintiffs
10 There was a lack of clarity between witnesses as to the length. However, Mr Lindsay Williams, the valuer, gave evidence at the hearing for the first defendant. He deposed that the farm track is
437.3 m in length over the Mirkin’s property and 75.2 m over the Wins’ land.
have recently created a plantation of pines on their property and have stock grazing. They use a small electric car and farm vehicles when using the farm track.
[18] I am satisfied that pedestrian-only access to the plaintiffs property is not reasonable access for the following reasons:
(a)the plaintiffs use their property for farming purposes;
(b)the plaintiffs must travel some distance over the Mirkin and the Wins’ farms from the road in order to reach their home; and
(c)the plaintiffs need to convey small children.
[19] Therefore, I consider any reasonable access should be vehicular and not limited to pedestrian, four-wheel drive or quadbike access.
[20] In 2021, the plaintiffs explored the possibility of using the paper road but abandoned it as being cost prohibitive. The plaintiffs produced two quotes obtained this year for the forming of a vehicular track over the paper road. These estimates do not appear prohibitively expensive on their face. For instance, a farm type track may cost approximately $80,000 without taking into consideration any council costs or resource consents. On the other hand, Mr Verrall, the surveyor for the plaintiffs said that quote was unrealistic. In particular, the estimate excluded any costs for dumping, and lacked any survey or engineering input. No contingencies had been added for unforeseen difficulties with the land.
[21] The quoted cost for formation of the paper road as a council road was in excess of $220,000. Again, Mr Verrall suggested this was far too low. That quote excluded engineering plans, resource consents, surveying and any arrangements for the dumping of excavated material. No further work has been done on the costings. However, it is apparent the cost of forming the paper road to make it usable will be considerable when the costs and contingencies are factored in.
[22] Mr Win also gave evidence about the access. He knows the land well and has been farming in Win’s Valley for many years, well before the arrival of the other parties
to this proceeding. He said that it was not feasible to form an accessway over the paper road. The first 300 m is gentle farmland and would present no difficulties for access. However, the last approximately 200 m is very challenging as it includes a steep area, a gully and a stream which cannot be reasonably used. He noted the terrain would also present drainage problems.
[23] Mr Mirkin agreed that there was no reasonable access to the plaintiffs’ property. In fact, the plaintiffs and both defendants filed an agreement to that effect under s 9 of the Evidence Act 2006. The parties agree that the plaintiffs do not have reasonable access to their property for the purposes of ss 326 to 329 of the Act.
[24] The issue of “reasonable access” is a question for the Court. However, I acknowledge the parties, in particular Mr Win, who knows the land, have the best knowledge on the feasibility of forming an access way over the paper road. The confirmation of the parties that there is no reasonable access other than by the farm track is a factor in my assessment. While the defendants have, on sufferance, allowed the plaintiffs to use the farm track, that use has been withdrawn from time to time. Except for an interim court order, there would be no access allowed over the farm track at present.
[25] I am satisfied the historical paper road has never been a realistic option for practical access.11 The defendants also acknowledge that there is no reasonable access over the paper road. This is reinforced by the surveyor’s comments on the costs of forming a usable access.
[26] Therefore, the paper road does not allow for the physical access that is reasonably necessary to enable the owner to use and enjoy the land for any permitted purpose and for which it is zoned.12 There is no other access to the plaintiffs’ property than over the farm track. I am satisfied that the plaintiffs’ property has no reasonable access and is, therefore, landlocked.
11 Wentworth v Sayes CA276/93, 26 May 1994.
12 See MacLaurin v Hexton Holdings Ltd [2008] NZCA 570, (2008) 10 NZCPR 1 at [20]–[22].
[27] Having reached that conclusion, I now turn to the mandatory considerations under s 329 of the Act.
Whether the Court ought to grant relief
Nature and quality of the access to the landlocked land
[28] Leah Gibson, and Carl Watter’s father purchased the property in November 2020. Mr Watters then took over his father’s interest. The plaintiffs’ purchase settled on 20 November 2020 and the transfer was registered on 30 November 2020. The relevant agreement for sale and purchase was silent as to the farm track.
[29] The plaintiffs say that they had been told that they had rights of access over the farm track to their land.
[30] The plaintiffs’ claim is contrary to the evidence of Mr Werner Arnold, the previous owner of the Mirkin land. Mr Arnold says that he did not make any representation to the previous owners (of the plaintiffs’ land), the Hannen family, or to the plaintiffs that the farm track provided legal access. While he had discussions with the Hannens’ over the access to the land before he sold to Mr Mirkin, no agreement had been finalised. The Hannens’ land had no dwelling on it and there were only a half dozen wild cattle and some goats grazing on the land. There had also been some pine plantings. Mr Ian Hannen, who was well into his eighties, used the farm track about once a fortnight and always closed the farm track gates. Therefore, Mr Arnold had no difficulty in allowing Mr Hannen to use the farm track to reach this block of land.
[31] Mr Arnold also recalls he told Mr Watters that they needed to resolve the issue of the access to the farm track. He had recorded this in a note made in January or February 2021 when tensions between him and the plaintiffs developed and he saw his lawyer over the issue. He thought the discussions with Mr Watters would have been in mid-October 2020. However, when pressed on that, he said it could have been later and could not say the exact date. Nevertheless, it is clear that by January 2021, Mr Arnold and the plaintiffs were in negotiations about an agreement for access,
without apparently any suggestion by the plaintiffs that they already had legal right of access over the track.
[32] The plaintiffs state that they initially intended to buy the land with a friend called “Patrick” whom they say told them they had rights over the farm track. Patrick was not called to give evidence and his role in the negotiations to buy the plaintiffs’ land is obscure. In fact, copies of texts produced dated 20 November 2020, between Patrick and Mr Watters suggest Patrick told Mr Watters to be careful about being trespassed from the land.
[33] Mr Arnold says the comments by the plaintiffs in relation to Patrick are a mystery to him. He has given no indication to anyone that the farm track is a legal access to the plaintiffs’ property. In addition, no evidence was called by the plaintiffs from the conveyancing lawyers who advised them on the purchase. Nor did they call any evidence from for instance the Hannen’s about what the plaintiffs were told about the status of the farm track access. There was no evidence of the plaintiffs pursuing their lawyers for advising them they had rights nor indeed making any claims against the Hannens over access.
[34] The owners of the farm track at the time the plaintiffs bought their property in 2020, say that no legal rights of access have been given either to their predecessors in title or to the plaintiffs. While the farm track has been used for access to the relevant land for at least 30 years, the previous level of use of the farm track (when the Hannen family owned the landlocked property) was very low compared to the daily use by the plaintiffs. In addition, shortly after their purchase of the land, the plaintiffs engaged in unsuccessful negotiations to rectify the legal access over the farm track when approached by Mr Mirkin’s predecessor, Mr Arnold.
[35] I do not accept the evidence of the plaintiffs that they did not know there was no legal access over the farm track. It was clearly important that they had access to their property and it was up to them to make the appropriate inquiries. At best, they were wilfully blind to the facts. Their knowledge of the lack of a legal right of access over the farm track is inferred from the evidence.
[36] I am, therefore, satisfied the plaintiffs knew that the farm track was not a legal access way when they bought it. There has never been any registered right of way over the farm track. There is nothing in the agreement for sale and purchase suggesting that there is a right of access over the track. There is no evidence apart from the plaintiffs’ assertions that the previous owners had given assurances about legal access over the farm track. I do not accept the plaintiffs’ evidence on this point.
[37] However, I do not consider the plaintiffs’ knowledge of the lack of legal right to use the farm track is disentitling to their claim for reasonable access. The defendants do not oppose the legalisation of the access on conditions and have taken into account that there is no other reasonable access to the plaintiffs’ property. The plaintiffs’ knowledge is relevant to conditions and compensation in which I will assess later in the judgment.
Circumstances under which the land became landlocked
[38] The evidence suggests that the paper road was laid out in the 1880s, possibly without appreciation of the contour and nature of the land.
Conduct of the parties
[39] Mr Arnold expressed some frustration about being unable to reach agreement with the plaintiffs on the terms of legal access before he sold his land to Mr Mirkin. He said he had to negotiate with the plaintiffs through his lawyer rather than do it personally. In the end, the plaintiffs walked away from the negotiations. Mr Watters suggested they would use the paper road. This was after Mr Arnold had agreed to them improving the track in reliance on an agreement for access being reached. Mr Watters said he walked away from the agreement as it did not proceed in a time for him to be able to use equipment he had on site for upgrading the farm track. The equipment had to be returned and so he ended the negotiations.
[40] Initially, Mr Mirkin had not been too concerned about finalising a formal access agreement and had continued with the informal arrangements. He became concerned when he found the plaintiffs’ stock grazing on his land. From May 2024 to December 2024, tensions escalated between Mr Mirkin and his partner on the one side,
and Ms Gibson and Mr Watters on the other. The police were called to arguments over the plaintiffs’ failure to close the gates, the gates being unlatched and gates going missing. The police mediated a signed agreement in December 2024. However, the plaintiffs say they misunderstood the terms of the agreement and this led to further tensions.
[41] In the December 2024 agreement, the defendants allowed the plaintiffs’ access to the farm track. At the time of signing this agreement, Ms Gibson and Mr Watters had been under the impression that they were required to close the gate only when it was already closed. If the gate had been left open, they believed they did not need to close it. Ms Gibson was adamant that she had always done that. She said that she would get out of the car to attend to opening and closing the gates, even when she had her children in the car. On the other hand, Mr Watters indicated that if there were no stock around, it was appropriate to leave the gate open. Mr Watters said he had been brought up on a farm and that this was his experience.
[42] There are three gates on the farm track: the road gate going onto Win Valley Road; the gate on the border between the Win property and the Mirkin land; and the gate between the Win land and the plaintiffs’ land. Mr Mirkin highlighted various concerns about the gates being left open, including risks to him and his partner. There were also biosecurity risks related to the plaintiffs’ cattle coming onto his property and damage to his land, including cattle eating his vegetable gardens and the trees on his curtilage.
[43] Mr Mirkin said he took care over farm management and closing the farm gates was integral to good management. He said he replaced the latches with metal bands on a number of occasions when the gates had been left open and the latches had been removed. He took to using binder twine due to having to replace the bands so often. Mr Mirkin suspected that Mr Watters had taken the gates off their hinges on at least two occasions. On one occasion, the road gate had been thrown down into a roadside. On another occasion, a gate by the Win property had been thrown down into an area containing gooseberry bushes and was difficult to recover. Mr Mirkin waited for his partner to return to assist him and recover the gate. He was also suspicious about an
occasion when Mr Mirkin’s stock were let onto the road and the fence padlock had been cut.
[44] Following the Court order in May 2025, Mr Mirkin made daily records of the times the gates were left open, latches were taken, or gates were taken off their hinges. Mr Watters agreed he had left the gate open at times when stock were not endangered as he had been frustrated by the tensions and disputes over the access.
[45] The plaintiffs said they could not gainsay the log but said there could not have been so many incidents of their leaving the gates open. The plaintiffs had installed CCTV cameras on the Wins’ property which were solar powered and turned on when they sensed movement. They had no footage for the period of Mr Mirkin’s log. The plaintiffs produced some photographs from July 2025 which showed Mr Mirkin and his partner at the gate apparently tying it open. Mr Mirkin agreed he tied the gate open as he was concerned at the ongoing and rising animosity between the parties and retribution.
[46] In his evidence, Mr Watters indicated some frustration with the situation. He said about the gates:
A. I’ve just left them as I’ve found them most of the time.
Q. Well, you agreed with me that the court order required you to keep them closed.
A. Yeah but then when I seen [sic] Mark leaving them open, I feel like it was not a big deal, so I’m sorry if I’ve not complied but I feel like I’ve just been leaving them as I find them which is… I didn’t think it was out of non-compliance [sic].
Q. Well, did you just not care about shutting the gates or could you just not be bothered?
A. Truthfully, five years down the track, yeah, it’s a bit of not caring anymore.
[47] Mr Mirkin’s concerns about security and his stock escaping are well founded. The parties have been unable to resolve this matter and the plaintiffs have not complied with the conditions imposed both by agreement and by the Court allowing them to use the farm track. This detrimentally affects the farm management and stock
management processes that Mr Mirkin seeks to observe. Mr Mirkin’s requirements are not unreasonable.
[48] It seems there was confusion around whether the plaintiffs had agreed to close the gate on all occasions when they passed through. It appears a previous copy of the agreement was circulated which did not contain a requirement to close the gates on all occasions but rather a provision to close them only if already closed. The plaintiffs say they thought the latter was the condition in the agreement they signed. Nevertheless, it was up to the plaintiffs to read what they signed — there is no suggestion that they did not sign the document. The order bound the plaintiffs to the closed gate condition. The provisions of the order are clear.
[49] In light of the evidence above, I am satisfied the plaintiffs have breached the requirement to close the gates from time to time.
[50] Finally, I note that there was no complaint by plaintiffs paying the monthly amount of $50 directed by the Court, but they had failed to pay the amount that they agreed to of $100 per month under the December 2024 agreement.
Potential hardship
[51] Mr Watters and Ms Gibson have also recounted incidents in which in particular Ms Gibson says she was fearful for herself and her children in view of the escalation of actions taken to prevent access to the farm track. She recounts an incident in which she had the children in the car and found the gate to the track had been padlocked shut. She said she saw people in the vicinity and was frightened. Ultimately, the police arrived, and the gate was opened. Mr Mirkin explained he had been moving cattle and had shut the gate. The plaintiffs have also been the subject of online abuse over the access dispute.
[52] If the farm track is not available to the plaintiffs, they cannot reach their home. This weighs in favour of the granting of an order. However, Mr Mirkin also faces hardship largely due to the failure to close the gates by the plaintiffs. This may well be capable of managing by appropriate conditions on any access agreement.
Other relevant matters
[53] The tensions between the parties continue. The need for a speedy resolution of this matter by the provision of access subject to conditions is evident. In particular, adequate fencing and stock management works need to be put in place as soon as possible.
Whether access should be ordered
[54] Despite the tensions between the parties, I consider it is appropriate to exercise my discretion to grant reasonable access over the farm track by way of an easement on conditions. As I noted, the defendants are realistic about the need for the plaintiffs to access their land and apart from the farm track, there is no other reasonable access. Having determined that the plaintiffs’ property is landlocked, and they are entitled to reasonable access, I now turn to consider what conditions should be imposed. In this case, I must also address compensation, the cost and manner of the capital works required, such as fencing, and the period to be allowed for the completion of works.
[55] In light of the ongoing tensions and the breaches of the interim arrangements by the plaintiffs, it is important that there is clarity in the terms of any conditions to be ordered. All parties want that, as well as precision in what is required of them.
[56] With that background, I now turn to consider compensation and conditions of any easement.
Compensation
[57] The Court of Appeal in Jacobsen Holdings Ltd v Drexel established the threshold test for setting compensation:13
…What has to be discovered is the value of the interest to the defendant owner with all its existing advantages, possibilities and potentialities. This must mean the market value; the price at which a willing seller would sell and a willing buyer would buy. Thus far the process is akin to that under the Public Works Act.
13 Jacobsen Holdings Ltd v Drexel [1986] 1 NZLR 324 (CA) at 333–334.
There is however no reason at all to exclude from that market a purchaser who has special needs and who would therefore be willing to pay more than others. The normal rule, in the absence of statutory provision to the contrary is that the competition of special needs, or, as it was put in Glass v Commissionersof Inland Revenue 1915 SC 449, 465, “the known wants of a probable purchaser” are not to be excluded in ascertaining the value of the land. … What it comes down to in the end is that “compensation” and purchase money or price are the same thing under different names.
[58] In Hajnal v Asmussen, the Court of Appeal said the application of the test involves:14
(a)identifying the value of the land being taken; and
(b)adjusting this starting point with reference to other relevant factors such as:
(i)the increase in the value of the buyer’s property;
(ii)the expenditure that the buyer will incur in establishing the easement;
(iii)avoiding over-capitalisation; and
(iv)any detriment of inconvenience to either party.
[59] In J T Jamieson & Co Ltd v Inland Road Ltd, the Court stated that it must also take into account detriment as well as benefit to the plaintiff.15 The Court criticised the appellant’s starting point for compensation. The appellant’s submissions focused on a reluctant seller, determined to extract all that he or she could from the sale, if they were to sell at all. The Court increased the award from $35,000 to $50,000 as it had strong evidence of what a willing buyer would pay. The evidence of a willing buyer was the respondent’s offer which was $50,000 in addition to undertaking any expenses relating to additional work to a driveway.
14 Hajnal v Asmussen [2010] NZCA 410, (2011) 12 NZCPR 169 at [46]–[52].
15 J T Jamieson & Co Ltd v Inland Road Ltd [2013] NZHC 3313, (2013) 16 NZCPR 237.
Valuation evidence
[60] Mr Lindsay Williams, a registered valuer based in Nelson, gave expert evidence for the plaintiff. No other valuation evidence was called.
[61] Mr Williams is experienced in rural valuations in Nelson. He gave evidence on the value of the improvement to the plaintiffs’ property value by reference to the value with the easement granted and the pre-easement value. The valuations were based on comparative sales in the area and comparing eight rural sales. On the basis of those comparators and based on his experience, Mr Williams concluded that the land owned by the defendants was more valuable per hectare than the plaintiffs’ land. He valued the present value of the plaintiffs’ property at $500,000. The improved value by providing an easement amounts to $150,000. The total improved value is
$650,000.
[62]Mr Williams valued the detriment to the defendants’ respective properties as:
(a)In relation to the loss of sole use of land in farm track, the loss to the Mirkin land is $5,000 and $1,000 for the Wins’ land.
(b)In relation to farm management disruption, the land between the paper road and the farm track is 1.6270 ha for the Mirkin property and is 0.1311 ha for the Wins’ property. The plaintiffs’ land is worth $3,000 per hectare compared to the balance of the Mirkin and Wins’ land which is valued at an average of $7,500 per hectare. This results in a diminution in value of $5,000 and $400 to Mr Mirkin and the Wins’ respectively.
[63] In addition, Mr Williams’ says that the improvement to the plaintiffs’ property should be divided between 25 per cent to Mr Mirkin and 10 per cent to the Wins, or
$37,500 and $15,000 respectively.
[64] Mr Williams also says the diminution and the disruption totals for Mr Mirkin’s property is $10,000 and for the Wins’ property is $1,400.
[65] Mr Zindel accepted the diminution value was fair but submitted the benefit allowance was too high.
[66] Mr Williams, when cross-examined by Mr Zindel, accepted the apportionment between the defendants was not a straight line calculation. He said he had considered factors such as the nature and contour of the land of the respective defendants, distance from road and quality of land and use of it.
[67] Mr Zindel challenged this reasoning suggesting that 35 per cent (of the total of the increase in value of the plaintiffs’ property which is attributable to the easement) was at the high end of the available range. That benchmark had been set in a case in which the Court of Appeal relied on an offer made which had set the market value.16 Mr Zindel suggested a figure of 27 per cent would be closer to a reasonable compensation figure. This figure is in the middle of the range of 20 per cent to 36 per cent suggested in the case law.17
[68] I see no reason to depart from Mr Williams’ assessments. The circumstances of this case justify a value near the higher end of the range of compensation. The intensity of use has increased substantially without consultation with the farm track owners over a short period of time. The plaintiffs also knew or ought to have known that the farm track was not a legal access. Furthermore, there has been no resolution despite attempts by Mr Arnold and his successor, Mr Mirkin.
[69] In addition, the plaintiffs have breached conditions related to the use of the farm track, causing concerns about the security of Mr Mirkin’s cattle. The compensation for benefit at 35 per cent includes the fact there are two owners to negotiate with and each are entitled to reasonable compensation. While the global improvement portion is 35 per cent individually, only 25 per cent and 10 per cent is payable to Mr Mirkin and the Wins’ respectively. The plaintiffs have also used the farm track for free (accepting they have largely maintained it for their own benefit)
16 See Jacobsen Holdings Ltd v Drexel, above n 13.
17 See Fox v Hamilton [2024] NZHC 2479 at [13(c)] citing Dooley v Sturgess Consulting Ltd [2016] NZHC 1905.
since 2021. The exception to the plaintiffs’ free use is the payments of $50 per month as ordered by the Court in May 2025.
[70] Against that background, a willing buyer would be prepared to pay the amounts assessed by Mr Williams. I am satisfied a willing seller would accept that payment. The plaintiffs made no objection to the detriment figures so I do not comment further on those, they appear reasonable.
Capital works and nature of the fence
[71] All of the capital works for the upgrading, fencing and other work required (including drainage) will be at the cost of the plaintiffs. The width proposed by the plaintiffs is 10 m but the defendants say it should be 5 m. The latter would agree to a 6 m width with some flexibility where a greater width was appropriate for bends or dealing with construction issues. I consider that 6 m is sufficient to provide reasonable access in the present circumstances with some flexibility as described. The track is to remain gravelled but some works are needed for drainage.
[72] The works must be reasonable. However, in the circumstances of this case, the quality of the work is important as well putting in place arrangements to minimise disputes. In addition, given the history of tension and disputes and the fact that the plaintiffs have breached earlier arrangements, the fence and works will need to be robust and effective for ongoing stock management.
[73] There was no disagreement that, at a minimum, the whole of the length of the farm track should be fenced on both sides. The parties also favoured the construction of parallel gates on each side of the track to be opened to form a “chute” for the stock to pass across the track. The gates can then be left closed to avoid impeding the track unless stock are moving across the track.
[74] An issue arose as to whether the fence should include battens or post and wire. Battens make the fence sheep-proof, but post and wire is only suitable for cattle. At the moment, the Mirkin farm only runs cattle, but Mr Mirkin indicated that previously and, in the future, he may well need to run sheep. He had no shearing shed but indicated he would be stocking sheep that would not require shearing. There was
general agreement among the farming witnesses that a battened fence was preferable. Once in place, the parties indicated little in the way of further repairs and maintenance would be required for the fence over at least the midterm. However, Mr Watters argued that the battens added an unnecessary and extra cost.
[75] In addition, Mr Verrall (expert surveyor for the plaintiffs) suggested cattle stops which are embedded into the ground and stop the cattle going onto the road. However, Mr Watters was concerned that the level of water table in the area is high which facilitates gravel flushing away down the cattle stop. He was also concerned about whether the stops would be sufficiently durable. He noted they are subject to damage by large trucks.
[76] Mr Mirkin seeks a time estimate for the works. He is entitled to have the works completed within a reasonable time. The parties will need to discuss a realistic timeframe. From the information before the Court, the timeframe appears to be in the range of three to six months for all works to be completed. I note that financing must also be arranged by the plaintiffs. The parties are also to consider the payment mechanism.
[77] I consider a batten, post and wire fence is reasonable in the circumstances. It is not practical to put in place an arrangement that requires further upgrading of the fence at a later date given the level of tension between the parties. There was general agreement that the addition of the battens made for better and more robust fence. In the circumstances that is preferable to ensure the fence is robust at the outset. Both sides of the track must be fenced, and chute gates inserted at appropriate intervals parallel to the farm track. The chute gates meet in the middle and open from each side of the farm track. I also consider it reasonable to put in place a cattle stop at the road gate. The placement of the gates, the cattle stop and the design as well as other details will need to be further developed.
[78] Mr Mirkin does not want Mr Watters doing the required fencing and work to upgrade the farm track. Mr Mirkin pointed to the instance where Mr Watters had previously built a drain without adding a ramp. He also referred to an incident when spoil had been left in piles on his paddock, rather than properly spread following
excavations on the drive. On the other hand, Mr Watters said he was a qualified fencer and had recently reinstated his membership of the Fencers Association.
[79] Given the level of distrust between the parties, there are two options which I consider appropriate for the parties to consider. The parties may either nominate a third party to oversee the construction of the fence by Mr Watters or a third party contractor will carry out the work. I will leave the parties to consider these options and attempt to agree.
Ongoing repairs and maintenance
[80] It is common ground Mr Mirkin uses the farm track substantially less than the plaintiffs who use it a number of times a day. Mr Mirkin uses a quadbike to travel over rough terrain and he does not need to use a gravel track. Therefore, the upgrading and repairs are largely for the plaintiffs’ benefit.
[81] The Wins use the access minimally. Mr Win recalled going up to cut a fallen tree with Mr Hannen but noted that he would not usually need to use the farm track. There was no suggestion Mr Win should contribute. The parties agree that the use should be limited to the present nature and scale. No further development was contemplated at present.
[82] Mr Zindel suggested that the cost of ongoing repairs and maintenance should be met by the plaintiffs and Mr Mirkin at 80/20 per cent respectively. Mr Praat, for Mr Mirkin, suggested a 90/10 per cent split was appropriate because Mr Mirkin rarely used the track. In my view, the evidence supports a 90/10 per cent split of ongoing repairs and maintenance of the farm track between the plaintiffs and the first defendant respectively. There was no suggestion that the Wins should contribute anything at present nor do I consider that they should.
Costs to date
[83] Mr Mirkin has incurred costs relating to legal advice both before and after the proceedings had commenced. Toward the end of the hearing Mr Praat referred to invoices totalling to $6,352. Mr Zindel states that he has had no opportunity to
consider them and he was not on notice of the claim. I am not prepared to consider this late claim for compensation. Costs of the proceeding can be claimed in the ordinary way.
Conclusion
[84] For the reasons above, following finalisation of the terms of the easement, payment of compensation and financing of the capital works, and subject to any variation required as a result of failure to resolve the outstanding issues, the following orders will issue:
(a)the plaintiffs’ land is landlocked;
(b)reasonable access is granted over the first and second defendant’s land on the conditions referred to above; and
(c)access to be set out in a registered easement following the finalisation of the terms of the easement, payment of compensation and financing of the capital works.
[85] The compensation is set at the amounts as assessed by Mr Williams. The assessment of the compensation involves evaluation and judgment based on experience. Mr Williams explained his approach and followed the willing buyer and seller methodology.
[86]I indicate the applicable conditions in general terms below:
(a)The plaintiffs are to pay for the capital works to be carried out.
(b)The parties are to seek to reach agreement on the arrangements for oversight if the plaintiffs wish for Mr Watters (as long as he is registered as a fencer) to carry out the fencing. If the parties cannot reach an agreement, they are to appoint a third party contractor to carry out the fencing work.
(c)Failing that, the parties are to seek to reach an agreement as to appropriate persons or firms to complete the drainage and other work. The plaintiffs must meet the costs of all works including drainage and other work required to be done by third parties, including surveying and conveyancing to effect the easement.
(d)Payment for the works must be arranged by the plaintiffs on terms satisfactory to the defendants on or before the expiry of three months from the date of this agreement.
(e)The parties are to seek to agree on a timetable for the works.
Next steps
[87] Mr Praat, at the hearing, indicated he intended to circulate conditions which would include those referred to above and implied conditions where not inconsistent with the Act and the Land Transfer Regulations 2018. Moreover, the mechanics of putting in place the conditions will need to be included, such as the timeframe for the work and any necessary details that I have omitted to deal with. The proposed memorandum has not yet been filed.
[88] I direct counsel to file a joint memorandum setting out the final conditions together with any other details in relation to the works on or before 20 days from the date of this judgment for further consideration. That memorandum should cover the outstanding issues that have been indicated above and on which agreement cannot be reached.
[89] If the parties cannot reach agreement on the issues which remain outstanding following the determinations in this judgment, including finalisation of the arrangements for the capital works, and any other details that require determination, the matter will need to be set down for a further hearing. Leave is accordingly reserved to the parties to apply to the court for further orders. Pending further order of the Court, the interim order remains in place.
Costs of the proceedings
[90] Costs are reserved for further submission following the completion of final orders.
Grice J
Solicitors
Zindels, Nelson for Plaintiffs
Client Legal Solutions Ltd, Nelson for First Defendants Pitt & Moore, Nelson for Second Defendant
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