Burgess v Benakis

Supreme Court of NSW|2024-11-13|Before: Peden J

EX TEMPORE Judgment (REVISED)

Mr Mark Burgess lives in Kingsford, New South Wales (number 459). He has sued his neighbour at number 461, Ms Sophia Benakis, because he wants her to remove encroachments on his land that support her garage wall located near the boundary.
Ms Benakis' garage was built in about 1937. In about 2006, the garage wall near the boundary was leaning, and Ms Benakis' mother, then owner of 461, installed two metal beams with concrete footings to support the garage wall. In June 2023, the Registrar General determined the common boundary between the parties' properties, and since then, it has not been in dispute that identified parts of the metal beams and concrete footings encroach onto Mr Burgess' land.
Ms Benakis defends the matter, and by way of amended cross-claim, seeks an order granting her an easement for support from Mr Burgess for the life of the garage. She further asserts that Mr Burgess continues to cause a nuisance because of uncontrolled stormwater discharging from his land to Ms Benakis' and weakening her garage's footings under the wall. She seeks an order that he install adequate stormwater drainage.
Mr Burgess denies he has committed or adopted any water nuisance and raises the inutility of a mandatory injunction in circumstances where he intends to develop his property further, including to install stormwater systems.
While the parties identified 25 issues for determination, there were really fewer, particularly after Mr Burgess no longer pressed his trespass claim. The issues that remain are: 1. Whether Ms Benakis' beams and footings ought to be removed by an order under s 3(2)(c) Encroachment of Buildings Act 1922 (NSW) (the Act). 2. Whether alternatively, Ms Benakis ought be granted an easement of support for her garage wall for the life of the garage under s 3(2)(b) of the Act, and if so, the appropriate compensation payable to Mr Burgess. 3. Whether Mr Burgess has caused or continues to cause a nuisance, and whether he ought be ordered to carry out stormwater works.

View

On the first day of the hearing, the Court conducted a view of the relevant properties pursuant to s 53 Evidence Act 1995 (NSW) to assist with an understanding of the evidence. The parties and parties' legal representatives attended and observed the external features of the parties' properties. The view stopped where counsel sought to demonstrate various physical aspects of the evidence. Some aspects are detailed below.
The view commenced at the front of the properties and the topography of the surrounding land sloping towards the backyards was observed. The lowest point appears to be on the street outside the back of Mr Burgess' property.
Various street drains depicted in photographs in evidence were pointed out, as was the fact that most of the downpipes on Mr Burgess' property empty onto his land, rather than being piped into stormwater drainage. That water would flow down the grassed backyard, which may absorb or disburse it, or it would flow to the very back.
In Mr Burgess' backyard next to Ms Benakis' garage is his fibre concrete shed, apparently built in the 1960s. It has rusted gutters, not connected to downpipes. Next to the shed is a ground level drain that flows to the street stormwater pit. Ms Benakis asserts that the existence of the shed increases water being captured next to the garage and impacts on its footings. Mr Burgess wants to demolish the shed and carry out building works, including stormwater drainage works, for which he has Council approval.
Ms Benakis' downpipes also empty onto her backyard, which is primarily concreted. The slope of the land would suggest water drains in a southerly direction.
Various repairs to the garage brickwork were observed. Ms Benakis did not give clear evidence of what the repairs were for and when they were carried out. The garage was viewed internally, where, despite it being full with a car and miscellanea, it was obvious that the western wall was bowing outwards and there was cracking in the concrete slab in places closer to the wall.
The effect of the Registrar General's boundary determination was pointed out from the street and in Mr Burgess' backyard. That determination has led to an agreed position that: 1. The northern footing encroaches Mr Burgess' land by 51 cm; 2. The bottom of the northern beam on top of the footing encroaches by 5cm, and the top by 0.55cm; 3. The southern footing encroaches by 48cm; and 4. The bottom of the southern beam encroaches by 11cm and the top by 12cm.
The encroachments described in the evidence are depicted in the photo and survey shown below.

Background

About 48 years ago, Ms Benakis' parents purchased 461. The residence was built in around the 1930s, and as noted, the garage was built in about 1937.
Ms Benakis has lived in the property her whole life and, in November 2008, she inherited it from her late mother. She lives there with her husband, Mr Peter Vukovic.
In about 2003, Ms Benakis' mother had a discussion with the former owner of 459, Ms Kallegeris, concerning the bowing of the garage wall.
Ms Benakis and her brother, Mr Andrew Benakis, assert that the women agreed that the encroaching beams and footings would be installed to support the western wall of the garage. Mr Benakis was present at the conversation, but could not recall discussion about whether Ms Kallegeris specifically agreed to the works encroaching on her property. Instead, to his memory, both women wanted the garage wall to be safe for everyone. I consider it unlikely that the women knew the precise boundary of the properties, or that the supporting works would encroach 459.
In about March 2006, Ms Benakis engaged a contractor to install those supports. I accept that Ms Kallegeris permitted the encroaching supports to be built and therefore, at least by conduct, she agreed to them. She did not object while they were being built and did not require them to be removed. It would appear that she was aware of the encroachments when she sold the property to Mr Burgess, because she had commissioned a survey, which revealed that fact.
On 26 September 2018, Mr Burgess exchanged contracts for the purchase of 459. No easement benefitting Ms Benakis concerning the encroachments was recorded on title. The next day, Ms Benakis' solicitor wrote to Ms Kallegeris' solicitor asserting an agreement about the installation of the beams and asking him to inform Mr Burgess. The letter did not assert that the garage's foundations were failing because of excessive stormwater flowing onto 459.
Mr Burgess says he was unaware of any agreement with the former owner concerning the encroachments, because he was not given that part of the surveyor report that may have revealed it.
In November 2018, Mr Burgess settled on the purchase of 459. From that time, Mr Burgess leased out the property, until January 2020, when Mr Burgess and his partner Ms Natasha Poole moved in.
On 24 June 2020, Ms Benakis signed a fencing notice, seeking an agreement with Mr Burgess concerning the cost of a boundary fence. That notice attached Ms Kallegeris' survey.
On 25 September 2020, Randwick City Council granted Mr Burgess development consent to modify his residence, demolish the rear shed and outhouse, and build a new garage and swimming pool.
On 28 October 2020, for the purposes of a construction certificate, Mr Burgess commissioned CMS Surveyors Pty Ltd to prepare a survey report of 459. The survey shows that the beams and footing supporting the western wall of Ms Benakis' garage encroach onto his land, including part of the location of his proposed development.
From November 2020, Mr Burgess' lawyer demanded that Ms Benakis remove the encroachments.
Ms Benakis did not accept there was any encroachment as alleged, despite Ms Kallegeris' and Mr Burgess' surveys. On 13 January 2021, Ms Benakis' lawyer suggested an independent surveyor determine the true boundary.
Mr Burgess' lawyer made further demands in July 2021 and on 8 September 2021. On 6 July 2022, Mr Burgess commenced these proceedings.
In August 2022, Ms Benakis commissioned her own survey, which also showed the structures encroached. However, the extent of the encroachments was not agreed. Finally, that issue was resolved in June 2023 with the Registrar General's determination.

Relief under the Encroachment of Buildings Act

Both parties seek different relief under section 3 of the Act, which provides: (1) Either an adjacent owner or an encroaching owner may apply to the Court for relief under this Act in respect of any encroachment. (2) On the application the Court may make such orders as it may deem just with respect to: (a) the payment of compensation to the adjacent owner, (b) the conveyance transfer or lease of the subject land to the encroaching owner, or the grant to the encroaching owner of any estate or interest therein or any easement right or privilege in relation thereto, (c) the removal of the encroachment. (3) The Court may grant or refuse the relief or any part thereof as it deems proper in the circumstances of the case, and in the exercise of this discretion may consider amongst other matters: (a) the fact that the application is made by the adjacent owner or by the encroaching owner, as the case may be, (b) the situation and value of the subject land, and the nature and extent of the encroachment, (c) the character of the encroaching building, and the purposes for which it may be used, (d) the loss and damage which has been or will be incurred by the adjacent owner, (e) the loss and damage which would be incurred by the encroaching owner if the encroaching owner were required to remove the encroachment, (f) the circumstances in which the encroachment was made. (4) The Court may refer any question involved in proceedings on the application to: (a) any registered land surveyor (within the meaning of the Surveying and Spatial Information Act 2002), or (b) any valuer. (5) This section applies to encroachments made either before or after the commencement of this Act.
Ms Benakis accepts that the encroachments fall within the meaning of "encroachment" in the Act. I note that the existence of an agreement between the former owners about the encroachments does not take those consensually erected structures outside the concept of an "encroachment" within the meaning of the Act: see eg Boed Pty Ltd v Seymour (1989) 15 NSWLR 715 at 717-9 (Bryson J).
The parties had agreed that there was a binary issue of whether it is more appropriate for the encroachments to: 1. remain, with Ms Benakis obtaining the benefit of an easement in order to protect her current garage while it exists, or 2. be removed to allow Mr Burgess to carry out his backyard development, with the effect that the garage will likely fail without significant works.
However, in closing submissions, Ms Benakis made an alternative unpleaded suggestion that the encroachments could remain, with no order being made under the Act.
Section 3(3) of the Act provides a list of non-exhaustive considerations that the Court may weigh in determining whether to exercise the discretion to make orders in relation to an encroachment. The Court need not consider each or any of those factors, and the extent to which it does is a matter of the Court's judgment. The discretion is broad and has been described as "very wide" and "most ample": Llavero v Shearer (2014) 17 BPR 33,381; [2014] NSWSC 1336 at [109] and [125] (Young AJA). Further, I adopt the summary of the law explained by Parker J in The Uniting Church in Australia Property Trust (NSW) v Crowe [2024] NSWSC 1387 at [433]-[458].
Mr Burgess' backyard is affected by the agreed encroachments, as they are situated in a location where he intends to build a new garage in accordance with the development consent. I accept that the encroachments "will interfere with the external wall of the garage and cause fire and structural issues". While it may be possible to construct the garage around them, that may require further designs and Council approvals. Expert evidence was given about how a different design may operate and the likely increased costs of up to $26,000. Those designs and the estimated cost were not challenged and I accept them.
Senior Counsel for Ms Benakis accepted that an amended construction on 459 could impact practically on Ms Benakis repairing or attending to the garage wall in the future to stabilise it, as is contemplated by the experts.
For example, Ms Benakis' engineering expert, Mr Blaszczakiewicz, identifies that the encroachments will not prevent the future failure of her garage wall. His view is that over time, water seeping next to the garage wall has caused erosion under the footings and slab, such that they have rotated. He describes this as a structural flaw, being the "inadequate embedment of the garage footings in the ground".
He opines this erosion has been caused by: 1. The ground level on Mr Burgess' land near the garage being lower than the garage slab and the other surrounding area in his backyard; 2. Lack of effective and adequate drainage of that area of depression; 3. Lack of an adequate connection of the drainage system for Mr Burgess' roof to the inground stormwater system.
He bases those conclusions on assumptions he has been given, including that there has been repeated flooding and pooling of water in the backyard of 459. However, he is not a hydraulic engineer and has not personally seen flooding. He has not carried out calculations about the volume of stormwater he considers lands on the roof of 459 and ought to be drained to any inground stormwater system. Neither has he carried out calculations about the effect of the grassed area and the drain next to the shed in reaching his conclusions.
Further, he considers that to keep the steel beams is "unwise" and that they "cannot be seriously considered to be … a long-term solution". To provide a permanent solution, he considers the encroachments must be removed as part of an alternative engineered solution that would cost about $42,686.11. To completely rebuild Ms Benakis' garage would cost about $137,637.17.
Mr Burgess' expert, Mr Mechreki, also considers the garage is exhibiting "signs of distress" and agrees that the footings, and possibly the slab, are no longer supported by earth as previously. However, he does not accept that the cause of the erosion can be attributed solely to water pooling near the garage. He noted that there are various repairs on the garage that have not been explained. He also opines that there is uncertainty as to the impact of subsoil water flow.
While I accept the experts' evidence that the footings have rotated because the soil support beneath them and the slab has eroded to some extent, I do not accept that Ms Benakis has proved that the cause of the erosion is solely stormwater on Mr Burgess' land that has not been drained to stormwater systems, and in particular, stormwater next to the garage wall.
For example, there is a geotechnical report in evidence that indicates that on 5 April 2022, boreholes, including one next to the garage wall, did not reveal any groundwater, but opined that water would seep between the soil and the bedrock up to moderate amounts after a period of heavy rainfall.
The experts did not consider that the garage had been built to the bedrock and therefore, the foundations were built on soil that would ordinarily experience some underground seepage. However, no evidence was given about the difference between the ground on 461 compared to 459 and whether the foundations of the garage on the other side were built down to the bedrock and if so, the effect of the inconsistency.
It is also unclear on the evidence what has caused the ground level on 459 to be lower than that on 461. It appears that the ground level has changed over the years, but there is no evidence about the effect of the construction of the encroachments on the ground near the garage, including the ongoing effect of the concrete footings and the weight on the ground. While there is no doubt that there has been erosion under the slab and footings, it has been a very slow process from 1937 when the garage was constructed until today.

Determination

Based on the facts above, I consider it appropriate to order Ms Benakis to remove the encroachments for the following reasons. For similar reasons, I do not think it is appropriate to grant her an easement for support or to retain the status quo.
The garage is around 90 years old. It has needed various repairs over time. Ms Benakis was very vague as to the extent and timing of those repairs. While the experts agree that the garage is technically beyond its accepted life, that does not mean it would otherwise have to be replaced. However, the experts agree that the defective wall needs restabilising at the very least and the whole garage rebuilt at most. On either approach, the encroachments must be removed as they will not support the garage into the future. They have served their purpose for about 18 years, but are not appropriate as the mechanism for support going forward.
It is therefore unclear the purpose of the easement Ms Benakis seeks to protect the encroachments, because they must be removed for the future stability of the garage. I therefore do not accept that Ms Benakis would suffer a relevant hardship if the encroachments were removed.
Ms Benakis relies on the fact that the former owner of 459 agreed to the encroachments as a good reason why they ought not be removed now. I accept that Ms Benakis has not done anything wrong by inheriting 461 with the benefit of the encroachments. However, that is only one fact to consider among many. Ms Benakis could have protected her position by seeking an easement from Ms Kallegeris before 459 was placed on the market. She did not.
Ms Benakis submitted that because the encroachments were over a small area, there would be "minimal loss of value of land". However, in circumstances where there is no evidence of the value of compensation for any easement, I do not consider that submission well made.
There are other reasons why I reject Ms Benakis' application for a temporary easement of support for the encroachments. I have not been taken to any authority where an order has been made for a temporary easement for the encroachments as is proposed by Ms Benakis, namely "for the life of the garage". I consider there is uncertainty as to how it would be determined that the garage was at the end of its life. Further, no process has been suggested for the removal of the easement when the garage is removed. I do not consider that granting an easement of any sort would be an appropriate exercise of the discretion here.
It is in the context noted above that the encroachments' impact to Mr Burgess must also be considered. If the encroachments are not removed and an order is made as sought by Ms Benakis for an easement for the life of the garage, then there will be an uncertain impact on Mr Burgess' ability to develop his land. It is uncertain how long the garage will remain standing. While Mr Burgess could amend his plans to build around the encroachments, that would cost a sum not a lot less than the cost to Ms Benakis to remove them and retain her garage.
I do not accept that Ms Benakis has demonstrated a good reason why the encroachments ought remain, rather than them being removed. I consider they amount to an unreasonable interference with Mr Burgess' enjoyment of his land.
I will order that Ms Benakis remove the encroachments within 90 days from the date of judgment. Her expert provided evidence in 2023 concerning the nature of works that would be needed to support the garage wall into the future. The expert was not asked to opine on the necessary time it would take to carry out those works. I am cognisant of the holiday period going forward, but Ms Benakis already has an engineer's opinion of the works that are needed, and therefore, I consider 90 days is a sufficient period of time to carry out the works.

Has Mr Burgess created or adopted a nuisance?

Ms Benakis claims that Mr Burgess has insufficient stormwater drainage and that has caused the garage foundations to weaken and subside and water flowing from his property is a nuisance. It was accepted that there are some downpipes on Mr Burgess' residence that drain to the council stormwater system, but others are not connected. It is said that water from the property will tend to flow downhill and tend to pool at the lowest part of the property, including next to the garage. That water will tend to seep and that has led to the footings softening.
Ms Benakis asserts that since June 2020, Mr Burgess has been aware of the impact of water on her land caused from stormwater flowing from his land because of his lack of adequate stormwater drainage from his house and shed, and that despite her demands, he has failed to take any steps to abate the nuisance. Her claim is therefore that he has continued a nuisance that has caused her garage footings and slab to rotate and the wall to bow and continues to do so. She seeks an order that Mr Burgess carry out stormwater works to abate the nuisance.
Mr Burgess submits that either there is no nuisance because it has not been demonstrated that the volume of water seeping under the garage from his land is concentrated, or that he has taken reasonable steps to abate any nuisance.
In Boyes v Thomson [2024] NSWSC 1325 at [22]-[26] I summarised the principles concerning private nuisance by stormwater (citations omitted): A private nuisance involves a "material and unreasonable interference with a plaintiff's use and enjoyment of their land" … In determining whether an interference is material and unreasonable, the Court is required to make a value judgment, having regard to: (1) "the character of the locality in which the inconvenience is created and the standard of comfort that those in the locality may reasonably expect", allowing some degree of "give and take" between neighbours: …; and (2) whether the "particular use of [the defendant's land] is 'reasonable according to the ordinary uses of mankind living in society, or more correctly in a particular society'" … [A] person is liable for having "continued a nuisance" if he or she has "knowledge or presumed knowledge of the state of affairs" giving rise to the nuisance, but has failed "to take reasonable steps to bring it to an end despite having had ample time to do so" … Where the alleged nuisance arises from the flow of water between two neighbouring properties, one of which is situated higher than the other: (1) the higher proprietor is not liable in nuisance merely because surface water flows naturally to the lower land; (2) the owner of the higher land "may be liable in respect of water artificially concentrated on its land and allowed to escape, as well as surface water which the defendant has caused to flow onto lower land in a more concentrated form than it otherwise would"…; but (3) the owner of the higher land is not liable in nuisance "if a more concentrated flow occurs simply as a result of the higher proprietor's natural use of its land", bearing in mind that "[w]hether a use is natural is determined in the light of all of the circumstances, including the purposes for which the higher land has been used and the manner in which the flow of water is increased."
The parties accepted that this was an accurate summary of the legal principles. Mr Burgess also relied on Emmett JA's statement in Gales Holdings Pty Ltd v Tweed Shire Council (2013) 85 NSWLR 514 at [132] that "an owner or occupier of land is not an insurer" of another's land.
Mr Burgess has proffered an undertaking to the Court that he will carry out stormwater works either pursuant to his approved development consent or otherwise, if Ms Benakis is ordered to remove the encroachments. I accept that undertaking.
The only relief Ms Benakis seeks is a mandatory injunction for the nuisance and her Senior Counsel accepted that the terms of the work to be carried out pursuant to the undertaking are consistent with the relief Ms Benakis seeks.
On that basis, it is not even necessary to determine if Mr Burgess has continued the nuisance.
However, for completeness, I deal with the issue very briefly, but in effect adopt the submissions of Mr Burgess. I do not accept that Ms Benakis has demonstrated that Mr Burgess is liable for a water nuisance as pleaded.

Did stormwater cause a nuisance?

Ms Benakis seeks to prove the nuisance by demonstrating that the garage wall currently supported by the encroaching beams has deteriorated because of excessive water influx from Mr Burgess' property.
She gives evidence that at unidentified times over the years: 1. She saw Mr Burgess' backyard flood when Ms Kallegeris owned the property. 2. She considers Mr Burgess' shed contributes to water influx into her property, because it does not have any downpipe connected to any stormwater drainage. 3. She considers the downpipes on Mr Burgess' home do not discharge water into drains on the street. 4. Water pools in Mr Burgess' backyard behind the shed and near the garage.
However, she only attaches photos of rain events and water on Mr Burgess' land on 5 occasions. She does not indicate whether in her opinion, those photos were taken during severe wet weather events, but it appears from other evidence that they likely were.
Mr Andrew Benakis also gives evidence about the flow of water. He says he saw large volumes of water pouring from Mr Burgess' property during a severe weather event. He further says water "appears to me to pool against the outside wall of the Garage".
Ms Benakis' husband, Mr Vukovic, also gives evidence of water pooling in Ms Benakis' property near the outhouse. He also provides photos of a much smaller amount of water pooling near the garage. However, I consider that there is a significant limitation in the photographic evidence. There is virtually no evidence of water pooling near the garage and where there is such evidence, it does not indicate the prevailing weather conditions and how long the water remained there.
Further, the parties' properties are located in an area which Randwick Council considers is particularly susceptible to flooding. The Council notes that in severe weather events, "runoff will exceed the capacity of the [street] drainage line forming a major overland flow path along Jacques Street with a depth of 0.5-1m". Mr Burgess and Ms Poole appear to have often complained to the various authorities about their concerns over the stormwater drains, the flooding of their backyard, and a sinkhole appearing in the nature-strip behind their property after an extreme weather event on 9 February 2023.
I accept that during severe weather events, water pools in the backyard of 459. However, the evidence does not demonstrate that the amount of water and the frequency of the water that flows amounts to a nuisance. I do not accept that any water flowing from 459 under the garage of 461 materially and unreasonably interferes with Ms Benakis' enjoyment of her property.
Instead, the substance of the complaint is that after 70 years, the garage wall began to bow and required the encroaching structures to support it. After almost 20 years from the installation of those structures, it is now the case that they provide insufficient support for the garage wall into the future. That demonstrates that even if the garage is affected by water on 459, it is having a very slow impact on the garage's structural integrity and does not rise to the level of a material and unreasonable interference with Ms Benakis' land.
I also consider Ms Benakis' evidence is lacking in other ways. For example, there is no expert evidence concerning the volume of stormwater said to be collected on Mr Burgess' property that pools in his backyard. There is no evidence about general rainfall in the area.
Mr Burgess' evidence that most water drains away relatively quickly after rain stops was not meaningfully challenged. Mr Mechreki's evidence was that the drain near Mr Burgess' back fence was tested and was working and could be expected to drain pooled water away, if the council stormwater drains were working.
I accept that evidence and find that there was no material and substantial inference with Ms Benakis' use of her property. I consider this is further supported by the fact that Ms Benakis did not complain in writing to Ms Kallegeris or Mr Burgess until their relationship became acrimonious and when she objected to his development application, including on the basis of "flooding".

Did Mr Burgess fail to take reasonable steps to abate the nuisance?

If that conclusion is wrong and it ought to be found that there has been a nuisance, it would be necessary to determine if Mr Burgess has failed to take reasonable steps to abate the nuisance after having become aware of it.
I accept that Mr Burgess became aware of Ms Benakis' complaint in about June 2020. However, I consider he has taken reasonable steps to abate any nuisance in the following ways.
By the time Ms Benakis complained to Mr Burgess, he had already submitted a development application that included stormwater plans that appear to deal with all the water issues in his backyard. Ms Benakis' objection to the application and the subsequent boundary dispute delayed the construction.
He also made complaints to various authorities about his concerns with the local stormwater drainage systems that appeared to cause flooding to his backyard that could possibly impact on 461.
I accept that Mr Burgess stopped work on his development, which would have included stormwater works, because of the current dispute. I do not accept that he failed to take reasonable steps to end the nuisance by not carrying out interim stormwater works.

Orders

For the reasons above, the appropriate orders are: 1. The Court notes the undertaking of the Plaintiff, attached to these orders. 2. An order for the removal of the encroachments as identified in the Statement of Claim, pursuant to ss 3(2)(c) and 10 Encroachment of Buildings Act 1922 (NSW), within 90 days from the date of judgment. 3. Amended cross-claim is dismissed. 4. Defendant/cross-claimant to pay the plaintiff/cross-defendant's costs of the proceedings as agreed or assessed. 5. Grant liberty to the parties to apply for an alternative costs order within seven days of today's date, setting out the application and any evidence and submissions of no more than 3 pages upon which they rely. 6. Should such an application be made for an alternative costs order, the responding party is to provide evidence and submissions of no more than 3 pages opposing any alternative costs order within seven days of receiving the first application. 7. The Court will determine any such alternative costs application on the papers, if appropriate.

Undertaking (93197, pdf) DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 19 November 2024

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