Hunt Leather Pty Ltd v Transport for NSW; Hunt Leather Pty Ltd v Transport... [2025] HCA 53 | Case summary

HIGH COURT OF AUSTRALIA

GAGELER CJ,

GORDON, EDELMAN, JAGOT AND BEECH‑JONES JJ

Matter No S20/2025

HUNT LEATHER PTY LTD & ANOR APPELLANTS

AND

TRANSPORT FOR NSW RESPONDENT

Matter No S21/2025

HUNT LEATHER PTY LTD & ORS APPELLANTS

AND

TRANSPORT FOR NSW RESPONDENT

Hunt Leather Pty Ltd v Transport for NSW

[2025] HCA 53

Date of Hearing: 15 & 16 May 2025

Date of Judgment: 17 December 2025

S20/2025 & S21/2025

ORDER

In Matter No S20/2025

Appeal allowed in part.
The orders of the Court of Appeal of the Supreme Court of New South Wales made on 18 September 2024 be set aside and, in their place, it be ordered that the appeal and cross-appeal be dismissed with costs.
The respondent pay the appellants' costs of the appeal.

In Matter No S21/2025

Appeal allowed in part.
The orders of the Court of Appeal of the Supreme Court of New South Wales made on 18 September 2024 be set aside and, in their place, it be ordered that the appeal and cross-appeal be dismissed with costs.
The respondent pay the appellants' costs of the appeal.

On appeal from the Supreme Court of New South Wales

Representation

A J L Bannon SC and A M Hochroth with L D Shipway and C M R Ernst for the appellants in each matter (instructed by Banton Group)

J T Gleeson SC and L G Moretti with B Lambourne for the respondent in each matter (instructed by Lander & Rogers)

Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.

CATCHWORDS

Hunt Leather Pty Ltd v Transport for NSW

Tort – Private nuisance – Where respondent planned and procured construction of Sydney Light Rail – Where appellants claimed to have suffered loss or damage by reason of substantial interference with ordinary enjoyment of land – Whether purpose of respondent's use of land common and ordinary – Whether construction work "conveniently done" – Whether respondent's liability based on exercise of special statutory power within meaning of s 43A of Civil Liability Act 2002 (NSW) – Whether respondent could rely on defence of statutory authority.

Damages – Assessment – Tort – Whether damages should include reasonable costs incurred in obtaining litigation funding.

Words and phrases – "balance", "based on", "common and ordinary", "construction work", "construction works", "conveniently done", "damages", "defence of statutory authority", "defences", "funding commission", "give and take", "injury to land", "litigation funding costs", "not convenient", "not ordinary", "nuisance", "onus", "ordinary enjoyment of land", "private nuisance", "proper consideration", "public authority", "reasonable", "reasonable expectations of the locality", "reasonableness", "right to land", "social utility", "special statutory power", "statutory authority", "substantial interference", "undue interference", "unlawful interference", "unreasonable", "use of land", "wrongful interference".

Civil Liability Act 2002 (NSW), ss 40, 41, 43, 43A.

Roads Act 1993 (NSW), s 7, Pts 2-4, 7-10.

Transport Administration Act 1988 (NSW), ss 3C, 3E, 104N, 104P, Sch 1, cll 3, 9.

Transport Administration Amendment (RMS Dissolution) Act 2019 (NSW), Sch 1.

Transport Administration (General) Amendment (Light Rail) Regulation 2015 (NSW), Sch 1.

Transport Administration (General) Regulation 2013 (NSW), cl 82A.

GAGELER CJ. These appeals concern the liability to neighbouring landholders in private nuisance at common law of a public authority exercising statutory power to procure public works on public lands.
The public authority is Transport for NSW ("TfNSW"), a corporation constituted under the Transport Administration Act 1988 (NSW),¹ a function of which is to facilitate the development of transport infrastructure² and a power of which is to enter into contracts in connection with that function.³ The public works comprise the construction by a private consortium, pursuant to contracts entered into with TfNSW, of the Sydney Light Rail. The construction was along public roads which TfNSW was licensed to occupy. The construction was authorised under the Roads Act 1993 (NSW)⁴ and was the subject of assessment and approval under the Environmental Planning and Assessment Act 1979 (NSW).⁵
The construction was planned to proceed in stages in order to minimise inconvenience to neighbouring landholders. The planned stages of construction, corresponding to proposed fee zones, were publicly announced in advance of the commencement of the construction. In the events which occurred, the construction period for each stage grossly exceeded that which had been planned and announced. This was due in part to the encountering in the course of construction of underground utilities the potential for which had been insufficiently factored into the planning.
Each of Hunt Leather Pty Ltd and Ancio Investments Pty Ltd was a lessee of business premises which fronted a road along the route of the Sydney Light Rail. Together with others, Hunt Leather and Ancio commenced representative proceedings against TfNSW in the Supreme Court of New South Wales in which each was found to have suffered substantial interference with the use and enjoyment of its premises, having regard to the noise and dust generated by the construction and to the presence of hoardings and barricades along the roads during the construction.
The principal claim of Hunt Leather and Ancio was that TfNSW was liable in private nuisance at common law for the totality of the damage attributable to the substantial interference that each was found to have suffered throughout the entirety of the period of construction on the basis that the construction was not a "common or ordinary use" of the land. The primary judge (Cavanagh J) accepted the factual premise that the construction was not a common or ordinary use of a road but rejected the propounded basis of the principal claim as insufficient to establish liability in private nuisance at common law.

Private nuisance at common law in Australia

The concern of private nuisance at common law is with the protection of proprietary interests in land.¹⁵ The standard description of a private nuisance is accordingly that of an "unlawful interference with a person's use or enjoyment of land, or of some right over, or in connexion with it".¹⁶ Other descriptions of a private nuisance have described it in terms of an interference with use and enjoyment of land that is "wrongful"¹⁷ or "undue".¹⁸
What do these references to an "unlawful" or "wrongful" or "undue" interference with use and enjoyment of land entail? No doubt, an actionable interference must be substantial: neither trivial¹⁹ nor transient.²⁰ But what more is required?
The first ground of the appeals has been framed to invite a contemporary answer to the question of whether a private nuisance at common law in Australia: is limited to a substantial interference with use and enjoyment of land that is "unreasonable"; or extends to any substantial interference with use and enjoyment of land that results from a use of neighbouring land that is not "common and ordinary". No issue has been raised in the appeals as to whether the law of private nuisance, like the rule in Rylands v Fletcher²¹ with which it has been closely associated,²² should be assimilated into the law of negligence either generally or in its application to a public authority.²³
The position that an interference with use and enjoyment of land must be both substantial and unreasonable in order to constitute a private nuisance at common law in Australia was established by the decisions of this Court in Gartner v Kidman²⁴ and Elston v Dore, has since been acted upon in intermediate courts of appeal, and accords with the contemporary understanding of private nuisance in Canada, New Zealand and the United States. At least until recently, the position was accepted by adherents and detractors alike to reflect the "conventional view" in the United Kingdom.

"The idea of reasonableness, that is basic to so much of the common law, is firmly embedded in the law of nuisance to-day. Pronouncements concerning the scope of nuisance as a tort avoid stating rights and duties as absolute. In respect of both what a man may do and what his neighbour must put up with, its criteria are related to the reasonable use of the lands in question."

Adding that "[a] shifting of emphasis has been a characteristic of the way in which Courts administering the common law have in recent times accommodated proprietary rights and modern social interests",³⁹ his Honour referred with approval to the then recent decision of the Full Court of the Supreme Court of New South Wales in Bayliss v Lea.⁴⁰ His Honour stressed that the determination of what is reasonable in the context of private nuisance is incapable of abstract definition and turns on a consideration of the totality of the circumstances.⁴¹

The reasoning in Bayliss is illuminative. There, Owen J, with whom Ferguson J agreed, confessed to having found earlier decisions on private nuisance confusing "not less so because it sometimes appears as though a statement made in relation to a particular set of circumstances has later been treated as if it laid down some rule of general application".⁴² His Honour expressed the opinion that the "true position" was "well stated" by Professor Fleming, who had written:⁴³

"The paramount problem in the law of nuisance is ... to strike a tolerable balance between conflicting claims of landowners, each of whom is claiming the privilege to exploit the resources and enjoy the amenities of his property without undue subordination to the reciprocal interests of the other. Reconciliation has to be achieved by compromise, and the basis for adjustment is reasonable user. Legal intervention is warranted only when an excessive use of property causes inconvenience beyond what other occupiers in the vicinity can be expected to bear, considering the prevailing standard of comfort of the time and place. Reasonableness in this context is a two-sided affair. It is viewed not only from the standpoint of the defendant's convenience, but must equally take into account the interest of the surrounding occupiers. It is not enough to ask: Is the defendant using his property in what would be a reasonable manner if he had no neighbour? The question is, Is he using it reasonably, having regard to the fact that he has a neighbour?"

Justice Owen noted in Bayliss⁴⁴ that Lord Wright had expressed the "same idea" when he had said in Sedleigh-Denfield v O'Callaghan:⁴⁵

"A balance has to be maintained between the right of the occupier to do what he likes with his own, and the right of his neighbour not to be interfered with. It is impossible to give any precise or universal formula, but it may broadly be said that a useful test is perhaps what is reasonable according to the ordinary usages of mankind living in society, or more correctly in a particular society."

Lord Wright had referred to the "gist" of the action for private nuisance in Sedleigh-Denfield as "the unreasonable and unjustified interference by the defendant in the user of his land with the plaintiff's right to enjoy his property".⁴⁶

In conformity with the explanations in Gartner and in Bayliss, Gibbs CJ, Wilson and Brennan JJ expressed the opinion in Elston that the explanation given by Lord Wright in Sedleigh-Denfield furnishes "the proper test to apply in most cases" of private nuisance.⁴⁷ Their Honours said that the deliberate conduct of the defendant in that case (had it interfered with use and enjoyment by the plaintiffs of their property or otherwise invaded their rights) would "only have been wrongful if it was not reasonable in the sense to which Lord Wright refers".⁴⁸ In the application of the "proper test", a substantial interference with use and enjoyment of land will therefore be actionable as a private nuisance if, but only if, such interference with the plaintiff's use and enjoyment of land as is attributable to the defendant is demonstrated by the plaintiff to be unreasonable.
Because the argument in these appeals has gone so far as to assert, by reference to what might turn out to have been no more than a passing comment in the reasoning of the majority in Fearn,⁴⁹ that the term "unreasonable" as used in the explanation of private nuisance given by Lord Wright in Sedleigh-Denfield "has no explanatory power", it seems necessary for the import of the term to be spelt out. "'Unreasonable' in nuisance law is not like 'unreasonable' in the law of negligence, for it does not refer to risk-creating conduct of the defendant but to the reasonable expectations of a normal person occupying the plaintiff's land."⁵⁰ "[T]he proper angle of approach ... is rather from the standpoint of the [plaintiff] than from the standpoint of the [defendant]".⁵¹ "The focus of the reasonableness analysis ... is on the character and extent of the interference with the [plaintiff's] land; the burden on the [plaintiff] is to show that the interference is substantial and unreasonable, not to show that the defendant's use of its own land is unreasonable."⁵² "[T]he question is neither what is reasonable in the eyes of the defendant or even the [plaintiff] (for one cannot, by being unduly sensitive, constrain one's neighbour's freedoms), but what objectively a normal person [in the position of the plaintiff] would find it reasonable to have to put up with." Another way of describing an interference with use and enjoyment of land that is "unreasonable" is accordingly as: an interference that is "unacceptable in the sense of being so objectively bothersome to another that the other is not expected to put up with the bother"; or an interference that is "greater than he ought to be required to bear under the circumstances, at least without compensation".

"To constitute a nuisance, the interference must be unreasonable. In making that judgment, regard is had to a variety of factors including: the nature and extent of the harm or interference; the social or public interest value in the defendant's activity; the hypersensitivity (if any) of the user or use of the claimant's land; the nature of established uses in the locality (eg residential, industrial, rural); whether all reasonable precautions were taken to minimise any interference; and the type of damage suffered."

There is no novelty in this approach. Historically:⁷³

"[C]ourts have insisted that the finding of a nuisance is a contextual, fact-rich, determination dependent on a long list of considerations: the time of the alleged nuisance, its length, its intensity, the neighbourhood in which it takes place, the number of people affected, the respective benefits of the competing activities, and so on. Though these factors can be stated in the abstract, they manifest themselves very differently in different cases and so taking them into account rails against any attempt to conclusively prioritise certain activities as more fundamental than others."

On the approach of the majority in Fearn, too much is packed into the concept of "common and ordinary" use and too much that is incapable of being packed into that concept is left out of the analysis. By excluding other considerations normatively relevant to the inquiry into whether an interference that results from an uncommon and extraordinary use is objectively greater than a normal person in the position of the plaintiff ought reasonably to have to put up with, the approach "over-simplifies the complex balance between competing interests" and thereby over-extends the appropriate scope of liability.⁷⁴
But the question of whether the position established in private nuisance at common law in Australia by Gartner and Elston should be altered or maintained has not been raised in these appeals in the context of a dispute between private landholders. The question has been raised instead in the context of a public authority exercising statutory power. That context in which the question has arisen shows that a dispute between private landholders is too narrow a frame of reference within which to consider its answer and points to further reasons why the position established in Gartner and Elston should be maintained.
The modern doctrine of private nuisance is as much the product of the reconciliation of public and private interests as it is the product of the reconciliation of competing private interests. One of the fundamental and enduring principles to have emerged through the many cases which have considered its application in this context has been the principle of statutory construction that when a statute confers a power on a public authority to undertake, or to procure the undertaking, of an activity on land in the public interest, the public authority "is thereby given a capacity which it would otherwise lack, rather than a legal immunity in relation to what it does, though a grant of power may have this effect when the infliction of damage on others is the inevitable result of its exercise".⁷⁵ That is because, against the background of the common law presumption that "the legislature did not intend to authorize what would otherwise have been tortious conduct",⁷⁶ the statute is construed to provide lawful justification for an otherwise tortious interference with use and enjoyment of neighbouring land only if and to the extent that the interference can be demonstrated to be the "inevitable result" of the exercise of the power.⁷⁷

"It must be recognised, in the defendant's favour, that the work being done is of a lawful and proper character. The construction of this railway is authorised by statute. Inevitably that construction will be attended by blasting and by noise. The defendant's conduct is not to be tested by the same standard as that which might be imposed upon a private person who, in the midst of this peaceful residential area, took up a quarrying or blasting activity. The defendant is entitled to have its conduct assessed with due acceptance that it is building a railway under the authority of a statute, and that the construction work would inevitably occasion noise and disturbance. But even giving to the defendant the full benefit of these considerations in its favour, the degree both of noise and of vibration exceeds that which in my view the plaintiff is compelled to bear. The defendant must take steps to diminish these nuisances."

To analyse the liability in private nuisance of a public authority undertaking public work in the public interest in this way is to recognise, in the language of Cromwell J in Antrim Truck Centre, that "the focus of the reasonableness analysis is kept on whether it is reasonable for the individual to bear the interference without compensation, not on whether it was reasonable for the [public] authority to undertake the work",⁹² as an outworking of the more general proposition to which attention has already been drawn that "the focus in nuisance is on whether the interference suffered by the claimant is unreasonable, not on whether the nature of the defendant's conduct is unreasonable".⁹³
The inconvenience of a public authority performing public works on public land is a common experience. Rarely could such public works be characterised as a "common and ordinary" use, as distinct from a "special" use, of that land. Yet often will the temporary duration of uncommon and extraordinary use of public land for public works combine with their beneficial nature to make it reasonable to expect occupiers of neighbouring lands to accept substantial interferences with their use and enjoyment of their lands as part of the cost of them living in an organised society. For how long and to what extent it might be reasonable to expect a particular neighbouring landholder to put up with a particular substantial interference with their use and enjoyment of land without compensation cannot be determined through the application of an abstract rule and depends on the totality of the circumstances.
Consistently with Gartner and Elston, the primary judge and the Court of Appeal were correct to proceed on the basis that liability in private nuisance at common law in Australia can arise only from an interference with use and enjoyment of land that is determined to be both substantial and unreasonable.

Substantial and unreasonable interference in the present case

Fact-finding in the present case was complicated by the multiplicity of ways in which Hunt Leather and Ancio chose to put their cases that TfNSW was liable to them in private nuisance and by a forensic stand-off between them and TfNSW as to the onus of proof of relevant facts. Without descending into the detail of the potential permutations, it is sufficient in now turning to address the second ground of the appeals to note that the primary judge found that the substantial interference with the use and enjoyment of their premises suffered by each of Hunt Leather and Ancio was substantial from the outset of the construction,⁹⁴ but found that substantial interference to have become unreasonable only after the point in time had been reached when "it was no longer reasonable to expect the plaintiffs as adjoining business operators to put up with the construction activity",⁹⁵ which "was lengthy and much longer than [TfNSW] had assured business owners would occur".⁹⁶
The difficulty which the primary judge faced was how to determine the precise period within which the substantial interference had been unreasonable. For that purpose, the primary judge turned to evidence of a planning and programming expert led by Hunt Leather and Ancio which the primary judge accepted as "some indication of what might have been a reasonable timeframe for the works to have been completed in each fee zone, assuming more knowledge and agreement in respect of utilities at the outset"⁹⁷ and therefore as "an appropriate measure for determining the point at which the interference with the land became unreasonable".⁹⁸
That evidence of the planning and programming expert, Mr Griffith, was given in the form of an amendment to the "Initial Delivery Program" ("IDP") which had set out the planned stages of construction which TfNSW had proposed at the time of contracting and which had been reflected in the public announcement that had been made in advance of the commencement of construction. The primary judge found that the IDP "was an estimate which the [contracting parties] must have considered to be reasonable and reflective of the way they thought the work could and should be done".⁹⁹ Mr Griffith's so-called "amended IDP" set out his assessment of what would have been an achievable timeframe for the works to have been proposed to have been completed in each fee zone at the time of contracting and public announcement had TfNSW done more in advance to manage the risk of encountering underground utilities in the course of construction by: undertaking surveys to obtain substantially complete knowledge of those utilities; and reaching concluded agreements with utility providers.

Section 43A of the Civil Liability Act

Part 5 of the Civil Liability Act is expressed to apply to "civil liability in tort"¹⁰⁷ and to extend to "any such liability even if the damages are sought in an action for breach of contract or any other action".¹⁰⁸ Within Pt 5, s 43A is expressed to apply to proceedings for civil liability to which Pt 5 applies "to the extent that the liability is based on a public or other authority's exercise of ... a special statutory power conferred on the authority".¹⁰⁹ A "special statutory power" is defined for this purpose to mean a statutory power "that is of a kind that persons generally are not authorised to exercise without specific statutory authority".¹¹⁰ The section is expressed to operate in proceedings to which it applies to produce the result that "any act ... involving an exercise of ... a special statutory power does not give rise to civil liability unless the act ... was in the circumstances so unreasonable that no authority having the special statutory power in question could properly consider the act ... to be a reasonable exercise of ... its power".¹¹¹
Whether an action in private nuisance against a public or other authority at common law is of a nature in respect of which s 43A of the Civil Liability Act can have meaningful operation or in respect of which liability can or might in specific circumstances be said to be "based on" the authority's exercise of a special statutory power are large questions. They were not fully argued in the appeals and do not now need to be determined.
For the purposes of resolving the appeals, it is sufficient to record my agreement with the analysis of the primary judge that TfNSW did not exercise any special statutory power in planning or contracting for the construction of the Sydney Light Rail. First, the specific power of TfNSW to "develop light rail systems, or facilitate their development by other persons" was not engaged in the absence of the existence at the time of regulations having the effect of bringing the Sydney Light Rail within the statutory definition of a "light rail system".¹¹² Second, in exercising its power to contract in the performance of its function to facilitate the development of transport infrastructure, TfNSW was not exercising a power of a kind that persons generally are not authorised to exercise without specific statutory authority. Third, just as "[t]o drive a vehicle on a public street, for the purpose of dealing with a fire or for any other purpose, needs no grant of power", so to plan for the development of transport infrastructure required no specific statutory authority.

GORDON AND EDELMAN JJ.

Introduction

These appeals primarily concern the tort of private nuisance and the intersection of that tort with the exercise of powers by statutory authorities. In broad terms, the principles of private nuisance balance a plaintiff's right to land with the liberties of a defendant to use other land. This balance is struck by imposing liability for a substantial interference with a plaintiff's right where the interference is with ordinary enjoyment of land if: (i) a defendant uses their land for a purpose that is not common and ordinary; or (ii) the defendant's use of land does not reasonably minimise the extent of the substantial interference with the plaintiff's ordinary enjoyment of land. In either circumstance, a defendant will have a defence of statutory authority if Parliament has authorised the defendant's uncommon use of land or failure reasonably to minimise the substantial interference, as the case may be. That authority will have been based upon a political decision, involving a policy assessment of the political costs and benefits of interferences with the use of land contrary to the reasonable expectations of the locality.
The application of these principles arises in these appeals from the construction of the Sydney Light Rail ("the SLR") that runs mostly through public roads in Sydney, including George Street in the Central Business District and Anzac Parade in the suburb of Kensington. The proceedings were brought by the appellants as the lead plaintiffs on behalf of all persons who hold or have held rights to land in the vicinity of the SLR and who claim to have suffered loss or damage by reason of a substantial interference with their enjoyment of land. Two of the four appellants are companies ("Hunt Leather" and "Ancio Investments") whose claims concern premises from which they traded as, respectively, a shop in the Strand Arcade on George Street and a restaurant on Anzac Parade. The other two appellants are Ms Hunt, the Chief Executive Officer of Hunt Leather, and Mr Zisti, who was formerly the sole director of Ancio Investments. The appellants will be referred to collectively as "Hunt Leather and Ancio Investments" in these reasons.
The respondent, Transport for New South Wales ("TfNSW"), planned and procured the construction of the SLR, although it did not perform the construction works. The "proposed staging of the construction activities (to minimise disruption to businesses and residents) could only be described as a complete failure".¹¹⁶
The trial judge in the Supreme Court of New South Wales (Cavanagh J) answered nine agreed common questions¹¹⁷ upholding, in part, claims for private nuisance by Hunt Leather and Ancio Investments. The Court of Appeal of the Supreme Court of New South Wales (Bell CJ, Leeming and Mitchelmore JJA) unanimously allowed an appeal, concluding that no nuisance had been committed by TfNSW.

(1) Issue 1: For a finding of private nuisance, is it sufficient that a defendant used land for a purpose that was not common and ordinary (being inconsistent with the reasonable expectations of the locality) and that the defendant's use caused a substantial interference with a plaintiff's ordinary enjoyment of land?

(2) Issue 2: If so, was the purpose of the use of land by TfNSW, adjacent to the land possessed by Hunt Leather and Ancio Investments, common and ordinary?

(3) Issue 3: If liability for nuisance is not established in the answers to Issues 1 and 2, is TfNSW liable for a private nuisance because TfNSW did not plan and procure the use of the relevant roads in a manner that reasonably minimised the extent of the substantial interference with the ordinary enjoyment of land by Hunt Leather and Ancio Investments?

(4) Issue 4: If TfNSW committed a private nuisance, was that liability "based on" TfNSW's exercise of a special statutory power such that s 43A of the Civil Liability Act 2002 (NSW) prevented recovery unless Hunt Leather and Ancio Investments could prove that the conduct of TfNSW was "in the circumstances so unreasonable that no authority having the special statutory power in question could properly consider the act or omission to be a reasonable exercise of ... its power"?

(5) Issue 5: If TfNSW committed a private nuisance, does it have a defence of statutory authority?

Although the first three issues concern the liability of a statutory public authority, they fall to be considered according to the basic principle that in the absence of any express provision to the contrary in the legislation that establishes TfNSW and confers its powers, the actions of TfNSW are to be treated in the same way as those of any private body.¹¹⁸ The answer to Issue 1 is "yes" and to Issue 2 is "no", giving rise to TfNSW's prima facie liability for private nuisance subject to the answers to Issues 4 and 5. Although it is therefore unnecessary to answer Issue 3, that issue would also have been resolved against TfNSW in circumstances where, in response to evidence supporting claims that it caused a period of unreasonable delay, TfNSW led no evidence to show that for that period it had planned and procured the construction works in a manner that reasonably minimised the extent of the substantial interference with the ordinary enjoyment of land by Hunt Leather and Ancio Investments.
The answer to Issue 4 is that s 43A of the Civil Liability Act does not apply. Therefore, subject to the defence of statutory authority, a private nuisance was created by the works planned and procured by TfNSW. As to Issue 5, TfNSW had statutory authority to plan and procure the SLR through George Street and Anzac Parade, but in order for TfNSW to establish a defence of statutory authority for procuring a nuisance, TfNSW was also required to show that its actions were consistent with the implied conditions for the exercise of its statutory powers, namely that the powers be exercised: (i) with reasonable care; and (ii) in a reasonable manner with a view to minimising the interference with the enjoyment by others of land for ordinary purposes. TfNSW failed to establish that it exercised its statutory powers in accordance with those implied conditions for part of the period of the nuisance.
A separate but consequential issue concerned whether the damages to which Hunt Leather and Ancio Investments were entitled should include the reasonable costs they incurred in obtaining litigation funding. The trial judge and the Court of Appeal properly rejected those claims.
With the agreement of Beech-Jones J we can state that the appeals should be allowed and, for different reasons from the trial judge, the orders of the trial judge restored with the only substantive point of difference between our reasons and those of his Honour concerning the application of these principles in Issue 2. We characterise the purpose of the use of land by TfNSW as construction work for a light rail, which we consider not to be common and ordinary in the relevant localities. Beech-Jones J characterises the purpose more generally as construction work, which is common and ordinary in those localities, but finds that the work was not "conveniently done" (as we also find). Beech-Jones J would have found the purpose common and ordinary in the relevant localities even if characterised as construction work for a light rail.

Background

The planning works performed and the construction works procured by TfNSW

TfNSW is a corporation and NSW Government agency constituted by the Transport Administration Act 1988 (NSW) ("the TA Act").¹¹⁹ TfNSW planned and procured the construction works for the SLR in various ways, including obtaining approvals for construction and entering into a "public and private partnership" involving a "Project Deed" in relation to the finance, design, construction, operation and maintenance of the SLR.
From 2012, TfNSW entered into agreements with City of Sydney Council, Centennial Park and Moore Park Trust, and Randwick City Council for a licence to enter and occupy, and to sublicense the entry and occupation of, land (including road surfaces and footpaths) owned by those bodies for the purposes of constructing the SLR. Most relevantly to these appeals, from the earliest stages of delivery strategy workshops in February 2013, TfNSW identified the scope of "Early Works" that were required in relation to utilities, recognising that the presence of utilities on the route of the SLR would be a primary area of risk and created a very uncertain environment. TfNSW initially intended to enter into a contract for Early Works which included treatment of utilities. Ultimately, however, TfNSW limited the utilities covered by its contract for Early Works to six key intersections.
For nearly two years following the scoping of Early Works, and before TfNSW entered into contracts to procure the construction works, TfNSW consistently recognised the risks for construction associated with the presence of utilities. At one point in the planning, TfNSW recognised the utilities risk as "extreme".
On 17 December 2014, TfNSW entered into the Project Deed and a design and construct contract. The essence of those agreements was that the SLR would be constructed by a Spanish infrastructure company and a French rolling stock manufacturer (referred to in the Project Deed as "OpCo") and then would be operated privately for 15 years.
Clause 12.3 of the Project Deed provided for the financial liability of OpCo for delay based upon the period of occupying each stage of the construction route (called "fee zones"). That amount was capped at $7.5 million. Importantly, an extension of time could be claimed for a "Utility Works Event", which included where it was necessary for OpCo to "protect, modify[,] replace, relocate or otherwise deal with" a utility that had not been identified.
Schedule A10 to the Project Deed was an "Initial Delivery Program", described as an "IDP". The IDP identified activities that would be undertaken in the various fee zones, the order in which the activities would be undertaken, and the time during which works on each fee zone would be undertaken. The IDP was not contractually binding, although the Project Deed required OpCo to use its "best endeavours" to achieve completion by 16 March 2019 and to "diligently progress the Delivery Activities".

The effect of the construction of the SLR on Hunt Leather and Ancio Investments

At all stages in this litigation it has been common ground that the construction of the SLR caused substantial interference with the enjoyment by Hunt Leather and Ancio Investments of the George Street and Anzac Parade premises. The interferences with the enjoyment by Hunt Leather of its George Street premises included: (i) "an incredible amount of loud and constant noise" from the operation of heavy machinery such that staff had to raise their voices when talking;¹²⁰ (ii) dust and dirt created by the works entering the store, and piles of dirt outside the store at times, with consequences including products being covered daily with dirt and complaints from the store's staff of health effects including nosebleeds, sinus irritation, and asthmatic and allergy symptoms;¹²¹ (iii) works on the footpath opposite the premises which restricted the ability of pedestrians to cross the street to the store;¹²² (iv) the entire road (although not the footpath) being blocked for differing periods during construction of the SLR;¹²³ and (v) the heritage doors to one entrance to the premises being closed during the construction works, further deterring foot traffic from entering the store.¹²⁴
The interferences with the enjoyment by Ancio Investments of its restaurant premises in Anzac Parade included: (i) hoardings and barricades outside the restaurant;¹²⁵ (ii) a pedestrian crossing adjacent to the restaurant being closed in December 2016;¹²⁶ (iii) noise and dust due to the construction activities which took place directly outside the restaurant, which at times included heavy machinery and concrete pouring and often coated its shopfront window in dust;¹²⁷ and (iv) the reduction of traffic lanes on Anzac Parade from three to two lanes, with one being a bus lane, and the prohibition of all parking outside the restaurant.¹²⁸

The evidence of Mr Griffith

At trial, Hunt Leather and Ancio Investments relied on what was described as "programming expert evidence" from Mr Griffith, a director of a firm of consulting engineers with over 30 years of engineering experience.¹²⁹ The application of Mr Griffith's expertise was described by the trial judge as "the assessment of whether there were delays in the completion of the SLR Project and the cause of those delays".¹³⁰
The issue addressed by Mr Griffith was alleged unreasonableness in planning by TfNSW. The issue arose because TfNSW had discovered utilities along the route of the SLR that needed to be treated by covering them, replacing them, moving them, or upgrading them in order for construction to proceed. TfNSW had known that there were utilities that it had not discovered but which would be discovered during the course of construction. It turned out that there were nearly as many utilities on the route that were not known to TfNSW prior to entry into the Project Deed as utilities which were known.
Mr Griffith formed an opinion, "[b]ased on his own project management experience", that TfNSW had failed to properly manage the delay risk associated with unknown utilities.¹³¹ Mr Griffith identified a number of deficiencies in the IDP which had been produced by TfNSW including, in respect of utilities, that: (i) there was nothing in the IDP which indicated how OpCo intended to address the problem of unknown utilities without delays; and (ii) the IDP for each fee zone did not anticipate the delays that would be caused by discovery of unknown utilities. Mr Griffith observed that the cl 12.3 cap for financial penalties upon OpCo meant that once all fee zones had been delayed for approximately one month the incentive was then for OpCo to open up more fee zones for construction, and thus extend the duration of construction in those fee zones, to assist with resource utilisation. Indeed, it was common ground among the utilities experts at trial that cl 12.3 of the Project Deed was "unique".
Mr Griffith produced an "amended IDP" which was said by Mr Griffith "to represent a reasonable baseline against which to assess delay". Mr Griffith relied upon that amended IDP for the conclusion that it was unreasonable for TfNSW to occupy the fee zones beyond the times set out in the amended IDP.
Mr Griffith's amended IDP assumed a "complete or substantially complete identification of all utilities along the route before construction commenced".¹³² The underlying assumption of Mr Griffith's calculation was therefore that a reasonable person in TfNSW's position would have discovered the unknown utilities, which "would have been allowed for [in the IDP] had they been known at the time of [the Project Deed]". As Mr Griffith said in his report, he "determined the number of Unknown Utilities ... relative to Known Utility Treatments ... and extended the Utility Treatment Activities in the IDP proportionately". For example, in fee zone 5, 67 utilities were known to TfNSW at the time of the IDP and a further 55 unknown utilities were later discovered during the construction, an increase of 82% in the number of utilities. Mr Griffith calculated the estimate for occupation of fee zone 5 in the amended IDP by increasing the number of workdays assigned to utilities (28 workdays) by 82% (reaching a total of 51 workdays).

The three forms of the private nuisance claims at trial

The starting point for the private nuisance claims brought by Hunt Leather and Ancio Investments is that TfNSW developed, planned, procured, and organised, but did not perform, the construction works. Hunt Leather and Ancio Investments therefore alleged that TfNSW committed the tort of private nuisance by: (i) authorising or permitting the construction of the project; and/or (ii) causing the delay in the civil works, thus lengthening the period of substantial interference with the ordinary enjoyment of land by Hunt Leather and Ancio Investments. Based on these acts by TfNSW, Hunt Leather and Ancio Investments put their case for private nuisance in three ways described as "Case A", "Case B", and "Case C" respectively.
Case A asserted that TfNSW had committed the tort of private nuisance by: (i) its responsibility for the construction works on the SLR (including hoardings on and along public roads for the purposes of the construction works), which substantially interfered with the enjoyment by Hunt Leather and Ancio Investments of their rights as occupiers of the land on which they conducted their businesses; (ii) the construction of the SLR not being a use of the land for common and ordinary purposes; and (iii) no defence of statutory authority or operation of s 43A of the Civil Liability Act being applicable.
Case B was an alternative. Case B was put on the same basis as Case A but with the changed element of s 43A of the Civil Liability Act being applicable, with the effect assumed to be that claims for private nuisance would also require Hunt Leather and Ancio Investments to prove that the conduct of TfNSW was "so unreasonable that no authority having the special statutory power in question could properly consider the act or omission to be a reasonable exercise of, or failure to exercise, its power".¹³³ In relation to this case, Hunt Leather and Ancio Investments relied upon the evidence of Mr Griffith.
Case C was a further alternative. Case C was also put on the same basis as Case A but with the changed element either that the construction of the SLR was a common and ordinary purpose or that it was not sufficient for a private nuisance that the construction was an uncommon or abnormal purpose. Hunt Leather and Ancio Investments alleged that TfNSW had not established that it took reasonable and proper precautions to prevent the disruptions that they suffered. Hunt Leather and Ancio Investments asserted that TfNSW bore the onus of proof to show that reasonable and proper precautions were taken.

The decisions of the trial judge and the Court of Appeal

As to Case A, and Issues 1 and 2 above, both the trial judge and the Court of Appeal held that although the purpose of the use of land by TfNSW, being the construction works for the SLR, was not common and ordinary, and although those works caused a substantial interference with Hunt Leather and Ancio Investments' ordinary enjoyment of land, these matters were not sufficient for a finding of private nuisance.¹³⁴
As to Case B and Case C, and Issues 3 and 4 above, the trial judge held that TfNSW was responsible for a nuisance caused by OpCo in fee zones 5 and 29. This was because when it entered into the Project Deed TfNSW was aware of the risk of discovery of unknown utilities in the course of construction and was aware that agreements had not been entered into with the utilities providers and that such agreements would take time.¹³⁵ The trial judge accepted Mr Griffith's opinion that TfNSW:¹³⁶

"could have done more to discover unknown utilities and that if it had, the delays in individual fee zones would have been lessened (as the ... contractor could have reached agreement on treatments in advance of starting the [construction] ...)".

In particular, the trial judge explained that the agreed terms of the Project Deed—and particularly cl 12.3, which "formed an integral part of [TfNSW's] fee zone strategy"—provided no disincentive for the contractor to overstay in the fee zones and left very little of the utilities risk to the contractor.¹³⁷

The trial judge concluded that the substantial interference with the enjoyment by Hunt Leather and Ancio Investments of their land became a nuisance to the extent to which the interferences exceeded the times in Mr Griffith's amended IDP, which reflected what was "reasonably achievable" by TfNSW and what it was reasonable for Hunt Leather and Ancio Investments to expect.¹³⁸ The trial judge concluded:¹³⁹

"Something went wrong. Specifically, [TfNSW] entered into the Project Deed at a time when it did not know the extent of the utilities risk and on terms which offered little deterrence to the ... contractor from overstaying in a fee zone."

The trial judge thus accepted Case C because he was "unable to be satisfied that [TfNSW] exercised reasonable care to protect the interests of the business owners along the light rail route".¹⁴⁰ The trial judge held that the unreasonableness did not rise to the heightened standard in s 43A of the Civil Liability Act¹⁴¹ but that s 43A did not apply because that section applied only to actions "based on" the exercise of a special statutory power and the tort of nuisance was based upon the harm experienced by Hunt Leather and Ancio Investments rather than the nature of TfNSW's conduct.¹⁴²
The Court of Appeal accepted the trial judge's finding that the failure to identify and respond to the unknown utilities prior to entry into the Project Deed was a substantial contributing reason for the delay.¹⁴³ The Court of Appeal also noted that there had been no challenge to the trial judge's conclusion that the utilities risk had not been allocated to the contractor or that cl 12.3 provided no disincentive for delays, which led to longer occupation of the fee zones.¹⁴⁴ The Court of Appeal also accepted that TfNSW bore the onus of proving that its conduct was not unreasonable.¹⁴⁵ Nevertheless, the Court of Appeal rejected Case C, and allowed TfNSW's appeal.
The Court of Appeal held that Mr Griffith's evidence proceeded on an assumption that the unknown utilities would have been discovered prior to entry into the Project Deed if reasonable care had been taken and, consequentially, assumed that agreements would have been entered into with the utility providers. The Court of Appeal held that these assumptions were never proved and that Hunt Leather and Ancio Investments failed to provide "evidence about how long it would have taken to obtain such knowledge [of the unknown utilities], or how disruptive doing so would have been to the occupiers of neighbouring premises".¹⁴⁶ Further, the Court of Appeal held that Mr Griffith's amended IDP did not delineate the period of unreasonable delay by reference to what actually occurred compared with what should have occurred.

The test for nuisance

The development of the test for the tort of private nuisance, particularly since the nineteenth and early twentieth centuries, has been concerned with balancing the competing interests of occupiers of proximate land, usually neighbours, in their enjoyment of their land.¹⁵¹ That is why the harm that is the concern of the tort of private nuisance is the diminution in the utility and amenity value of land rather than the personal discomfort of, or personal injury to, those who are occupying the land.¹⁵² As will be seen below, the balance, or "give and take", in the enjoyment of neighbouring land was struck by reference to the ordinary uses of land in the relevant locality, which involves consideration of both the purpose of the use and the means by which the purpose is achieved.
From the perspective of a plaintiff, it has been established since Walter v Selfe¹⁵³ that a claim for interference with the plaintiff's right to land can only be brought for private nuisance if there is "material discomfort and annoyance for the ordinary purposes of life to a [person's] house or ... property".¹⁵⁴ That principle, also well recognised in Australia,¹⁵⁵ requires for a claim for private nuisance that a plaintiff establish a substantial interference with the plaintiff's enjoyment of land for purposes that are ordinary, in the sense that the purposes are consistent with the reasonable expectations of the locality as to the use of that land.
From the inception of the modern tort of private nuisance, therefore, the starting point has been that the action requires a substantial interference with the plaintiff's ordinary use of land. Once this has been proved, the focus shifts to whether the defendant has acted with "any lawful ground of justification or excuse".¹⁵⁶

The defendant's substantial interference must be one that is not ordinary or not convenient

If a defendant causes a substantial interference with a plaintiff's enjoyment of land for ordinary purposes, the defendant may have a lawful ground of justification or excuse in an action for private nuisance if they establish that they were using their land for a common and ordinary purpose, by means that involved it being "conveniently done" in the sense of using means that reasonably minimised the extent of the interference.

(i) The foundational case in 1862

In 1862, in Bamford v Turnley,¹⁵⁷ Bramwell B set out the test for the conduct of a defendant which, despite involving a substantial interference with the plaintiff's ordinary use of land, would be justified or excused from liability for nuisance. That test has been described as the "leading",¹⁵⁸ "classic",¹⁵⁹ and "seminal"¹⁶⁰ statement of principle, and said to have been "expressed with a degree of precision and logic".¹⁶¹
The issue in that case was whether the smells from the burning of bricks on the defendant's land as part of construction works were a nuisance. The trial judge was held to have misdirected the jury by instructing them only in general terms to consider whether the defendant's use of his land was reasonable. Bramwell B set out a test that explained when acts would be "justif[ied] or excuse[d]" from constituting a nuisance despite those acts causing "a sensible diminution of the comfortable enjoyment" of land:¹⁶²

"There must be, then, some principle on which such cases must be excepted. It seems to me that that principle may be deduced from the character of these cases, and is this, viz, that those acts necessary for the common and ordinary use and occupation of land and houses may be done, if conveniently done, without subjecting those who do them to an action. This principle would comprehend all the cases I have mentioned, but would not comprehend the present, where what has been done was not the using of land in a common and ordinary way, but in an exceptional manner—not unnatural and unusual, but not the common and ordinary use of land."

The approach of Bramwell B focused upon two matters: the purpose of a use and the means or manner of a use. The only conduct of a defendant that would be "excepted" from constituting a nuisance was a use of land for a common and ordinary purpose, by means that involved it being "conveniently done". The existence of a use of land by a defendant that was not for a common and ordinary purpose (or a similar description) was said by writers to be "[t]he criterion of liability" and an "ingredient[] essential to constitute a cause of action".¹⁶³ Contemporary writers on private nuisance explained that the effect of this criterion was that "annoyance caused by the unusual use of a house may be a nuisance, when like annoyance from the ordinary use of it would not be".¹⁶⁴ Others added that "a trade was not to be treated as a nuisance if carried on in the ordinary manner in a convenient locality".¹⁶⁵
Bramwell B justified the rule as follows in his decision in Bamford v Turnley:¹⁶⁶ "[t]he convenience of such a rule may be indicated by calling it a rule of give and take, live and let live". That justification involves a reciprocal concern with the reasonably expected purposes and means of use in a locality, which in turn are determined by what purposes and means of use are "ordinary" or reasonably expected in the locality in which the plaintiff and defendant reside. A plaintiff will be expected to put up with substantial interference with their enjoyment of land if the purpose of the plaintiff's enjoyment is not common and ordinary. Equally, a defendant will not be liable for a use of land for a purpose that is common and ordinary and by means that are convenient. As Lord Leggatt put the point in Fearn v Board of Trustees of the Tate Gallery:¹⁶⁷

"This principle of reciprocity explains the priority given by the law of nuisance to the common and ordinary use of land over special and unusual uses. A person who puts his land to a special use cannot justify substantial interference which this causes with the ordinary use of neighbouring land by saying that he is asking no more consideration or forbearance from his neighbour than they (or an average person in their position) can expect from him. Nor can such a person complain on that basis about substantial interference with his special use of his land caused by the ordinary use of neighbouring land. By contrast, a person who is using her land in a common and ordinary way is not seeking any unequal treatment or asking of her neighbours more than they ask of her."

The rule set out by Bramwell B in Bamford v Turnley has been consistently recognised or applied in England¹⁶⁸ and Australia¹⁶⁹ for 150 years. In England, one of the earliest applications was by the Court of Appeal in Ball v Ray.¹⁷⁰ The issue was whether the keeping of a stable of horses next to a residential premises was a nuisance. The Lord Chancellor held that so long as the defendant had used his property "for the ordinary purposes for which it and all the different parts of it were constructed" there would be no nuisance but that there would be a nuisance if the property were used for "unusual purposes in such a manner as to produce a substantial injury", like the keeping of a stable.¹⁷¹ Recovery in nuisance was allowed because the keeping of a stable was not a purpose that was common and ordinary for the locality. Mellish LJ added that "we are not to consider the noise of horses from that stable like the noise of a pianoforte from a neighbour's house".¹⁷²
In Australia, the rule expressed by Bramwell B was first adopted by this Court in Clarey v Principal and Council of the Women's College.¹⁷³ In that case, the landlords of a property used as a women's college commenced an action under residential tenancy legislation, seeking an order for recovery of possession on the basis that the tenants had been "guilty of conduct which was a nuisance or annoyance to adjoining or neighbouring occupiers" by reason of the student residents of the women's college who made considerable noise late at night, which disturbed the neighbouring landlords in their sleep.¹⁷⁴ This Court unanimously approved the reasoning, discussed above, of the Lord Chancellor in Ball v Ray,¹⁷⁵ that a nuisance would arise from the use of property for unusual purposes which produced substantial injury.¹⁷⁶ The students' noises, however, were "only noises of the kind that are incidental to the occupation of premises as a dwelling" within the reasonable expectations of a landlord who let premises to university students.

(ii) The meaning of a "common and ordinary" purpose of use

The established effect of Bramwell B's reasoning in Bamford v Turnley was that a private nuisance would arise where there was a substantial interference with the plaintiff's enjoyment of land for ordinary purposes, caused by the defendant's use of land for a purpose that was not "common and ordinary". The compound expression, "common and ordinary", sometimes expressed as "normal and usual",¹⁷⁸ was aptly described by Professor Burdick as the expectation that people "must conform to the habits of the community":¹⁷⁹

"[T]he very nuisance the one complains of, as the result of the ordinary use of his neighbo[u]r's land, he will create in the ordinary use of his own, and the reciprocal nuisances are of a comparatively trifling character."

This concept of a purpose that is "common and ordinary" has sometimes been described in a general sense as a concern with what is "reasonable". But that language is loose and can encourage the erroneous conclusion that no nuisance will be committed if the defendant acts with reasonable care. As the Court of Appeal rightly held in this case, quoting a decision of Sholl J:¹⁸⁰

"It is no answer to say that the defendant is only making a reasonable use of his property, because there are many trades and many occupations which are not only reasonable, but necessary to be followed, and which still cannot be allowed to be followed in the proximity of dwelling-houses, so as to interfere with the comfort of their inhabitants."

In other words, where "reasonableness" is used in the context of an enquiry into whether the purpose of a defendant's use of land is common and ordinary, this sense of "reasonable" is shorthand for "what is reasonable according to the ordinary usages of mankind living in society, or more correctly in a particular society".¹⁸¹ That explanation was adopted by Gibbs CJ, Wilson and Brennan JJ (with Murphy J generally agreeing) in Elston v Dore,¹⁸² where their Honours said that wrongfulness for the purposes of the law of nuisance will only arise if the defendant's conduct "was not reasonable in the sense to which Lord Wright refers".
The identification of whether a purpose is common and ordinary should be made at the proper level of generality by reference to reasonable expectations based upon what is common and ordinary in a locality.¹⁸³ The exercise of identifying the purpose at the proper level of generality can sometimes be finely balanced but it will be guided by the conduct that is said to be the infringement.
Thus, "where a locality is devoted to a particular trade or manufacture carried on by the traders or manufacturers in a particular and established manner", it will not be a nuisance for a plaintiff to experience, in their use of land, the consequences of the defendant's use of land for the purposes of that particular trade or manufacture in that locality.¹⁸⁴ For instance, the noises during the night considered in Clarey v Principal and Council of the Women's College¹⁸⁵ were noises for the common and ordinary purpose, consistent with the lease and locality, of residential "accommodation of university students ... [who] keep late hours and in the course of doing so will make such noises". And there was no nuisance in Southwark London Borough Council v Tanner¹⁸⁶ from the noises, made for ordinary purposes and heard in neighbouring flats with inadequate sound insulation, of "not only the neighbours' televisions and their babies crying but their coming and going, their cooking and cleaning, their quarrels and their love‑making".
By contrast, some purposes, characterised at a level of particularity based on the conduct said to amount to the infringement, will be contrary to the reasonable expectations of the locality, and therefore a nuisance, in almost any residential locality. For instance, in 1904, the noises, vibrations, and "noxious or offensive smells" produced for the purposes of running a generating station in a locality with a "high-class boarding school for young ladies" was held "to be not an ordinary use of the defendants' property". So too, loud noises made only for malicious purposes, even if those noises might have been reasonably expected for other purposes, will be contrary to the reasonable expectations of the locality and a private nuisance. And, after finding that there was a substantial interference with the claimants' use of land for ordinary purposes, the defendant's purpose of using land in was held to be uncommon because a platform was built not merely for the purpose of being a structure from which to view art, but at the level of particularity of being a platform for the purpose of inviting "members of the public to look out from a viewing gallery".

(iii) The meaning of "conveniently done"

Even if a defendant who causes a substantial interference with a plaintiff's enjoyment of land for ordinary purposes does so by using their land in a common and ordinary way, the defendant will still commit a nuisance unless the defendant establishes that they have used their land by actions that Bramwell B described as "conveniently done". Consistently with the treatment by Bramwell B of this aspect of the tort of private nuisance as a lawful ground of "justif[ication] or excuse",¹⁹⁴ it has been held that the defendant bears the onus of proving that their use of land which causes such interference is "conveniently done".¹⁹⁵ Of course, a defendant does not bear an impossible onus of negating every imaginable allegation that the means adopted for the use of land were not conveniently done. A plaintiff bears an evidentiary onus to identify the respects in which the defendant's use of land is not conveniently done.
The requirement that a defendant establish that their use of land, for common and ordinary purposes, was "conveniently done" has also been described as a requirement that the defendant's use of land be "necessary for the common and ordinary use"¹⁹⁶ or, perhaps more accurately, as a requirement that the defendant's use of land be "reasonable according to the ordinary usages"¹⁹⁷ or "reasonable in the circumstances".¹⁹⁸ But the use of land by the defendant need not be "necessary" in the sense of "essential". And the concern with the reasonableness of a defendant's use of land is not a test for negligence but a concern that the defendant adopted means for their own ordinary enjoyment of land that reasonably minimised the extent of the substantial interference with the plaintiff's ordinary enjoyment of their land.
The assessment of whether a defendant's activity on their land for common and ordinary purposes is "conveniently done" thus requires consideration "not merely of the convenience of the defendant, but also the convenience of the plaintiff".¹⁹⁹ In other words, the assessment involves consideration of the relative interests of each of the parties in all the circumstances. Contrary to the reasons of the Court of Appeal in this case, the decision of Windeyer J in this Court (with whom Dixon CJ agreed) in Gartner v Kidman did not suggest that the approach of Bramwell B to whether the activity of a defendant was conveniently done had become a single test for private nuisance, subsuming the anterior questions of whether: (i) the activity of the defendant substantially interfered with the plaintiff's enjoyment of land for ordinary purposes; and (ii) the activity of the defendant was common and ordinary, in the sense of being for purposes consistent with the reasonable expectations of the locality.

"is a question to be determined reasonably having regard to all the circumstances, including the purposes for which the land is being used and the manner in which the flow of water was increased: as for example whether it is agricultural land drained in the ordinary course of agriculture, whether it is timbered land cleared for grazing, whether it is a mining tenement, or is used for buildings and so forth".

In other words, the question of whether the purpose of the use is "natural" (ie, common and ordinary) is determined by reference to the locality of the land and the associated reasonable expectations. Likewise, for the proprietor of lower land: (i) it would be common and ordinary to "put up barriers and pen [the water] back" to the higher land of the upper proprietor (but not a third proprietor), subject to (ii) "us[ing] reasonable care and skill and do[ing] no more than is reasonably necessary to protect his enjoyment of his own land".²⁰³ The exposition of (ii) was a classic explanation of Bramwell B's requirement that the activity be "conveniently done".

A dissenting approach: reasonableness in all of the circumstances

Although the approach of Bramwell B has been the dominant approach for 150 years in England and Australia, there is a dissenting approach upon which TfNSW successfully relied in the Court of Appeal below and which it also relied upon in this Court. That approach was taken in the dissenting reasons of McLure P in Marsh v Baxter²⁰⁴ and in the dissenting reasons of Lord Sales (with whom Lord Kitchin agreed) in Fearn v Board of Trustees of the Tate Gallery.²⁰⁵ The dissenting approach rejects the sufficiency of a defendant's uncommon or non‑ordinary use, the first part of Bramwell B's test for the tort of private nuisance, in cases where there is a substantial interference with a plaintiff's use of land for ordinary purposes. In other words, the dissenting approach maintains that a private nuisance does not necessarily arise where a defendant substantially interferes with the plaintiff's enjoyment of land by the defendant's use of land for purposes inconsistent with the reasonable expectations of the locality. Instead, those matters are subsumed into an overall instinctive synthesis of the reasonableness of the defendant's interference with the plaintiff's enjoyment of land. Both the trial judge²⁰⁶ and the Court of Appeal²⁰⁷ in this case considered that the dissenting approach represented Australian law. For the reasons above, that is incorrect as a matter of precedent. For the reasons below, it is incorrect as a matter of principle.
In Marsh v Baxter,²⁰⁸ McLure P recognised that a plaintiff had no claim for nuisance for an interference with an enjoyment of land that was "abnormally sensitive". And yet, her Honour considered that a test of general reasonableness should apply to determine whether a defendant had committed a nuisance, with the apparent effect that even a use by a defendant for uncommon or abnormal purposes causing a substantial interference with the plaintiff's ordinary use could be reasonable and not a private nuisance. McLure P held that this generalised reasonableness test was capable of taking into account the social utility of the defendant's farming of genetically modified canola in "increasing the yields from arable land",²⁰⁹ although her Honour ultimately concluded that the defendant's use of land did constitute a nuisance. In the context of a claim of private nuisance by a public authority, this approach comes very close to collapsing the test for private nuisance into the test for negligence by a public authority.

"If reciprocality is taken to mean compromise between incompatible uses of neighbouring land, then the scope of competing rights could, and presumably would, extend to uses which have nothing to do with the ordinary use and occupation of land. The use of a cement factory which emits dust and smoke competes with the nearby residents' use of their gardens. Perhaps there ought to be some compromise regarding these uses based on the value of the cement factory as against the value of a smoke- and dust-free residence. This is a compromise, but one that has nothing in common with the reciprocality that Bra[m]well B's words evoke."

TfNSW sought to find support for the dissenting approach in the Restatement (Second) of Torts, which defines private nuisance in the broadest of terms as "a nontrespassory invasion of another's interest in the private use and enjoyment of land" which for both intentional and negligent conduct must be "unreasonable".²²⁷ The Reporter for the Restatement (Second) of Torts framed the approach to nuisance by reference to the curious view that "private nuisance" contained no independent standard of conduct and merely borrowed from other torts.²²⁸ The Restatement (Second) of Torts then treated unreasonableness as determined by a test, very closely associated with the test for breach of a duty of care in the tort of negligence,²²⁹ involving "balancing the gravity of the harm against the utility of the conduct", or balancing the magnitude of the risk and gravity of the harm against the utility of the conduct.²³⁰
Even with an approach that aligned the tort of private nuisance with that of negligence (an approach not advocated by any party to these appeals), the Restatement (Second) of Torts nevertheless recognised that conduct will be "unreasonable" if the conduct that involves a significant inference with the ordinary enjoyment of land is conduct that is uncommon or abnormal:²³¹

"[W]hen it is found in a particular case that conduct that is unsuitable to the locality is causing significant harm through invasion of another's use or enjoyment of land that is suitable to the locality, the invasion is unreasonable although the conduct has social value and although the actor is taking all practicable measures to avoid the harm."

The nuisance provisions of the Restatement (Second) of Torts are in the process of revision in the drafts of the Restatement (Fourth) Property. The drafts of that Restatement offer a "revised account of the 'unreasonable interference' element that aims to provide courts with a clearer framework of analysis".²³² The relevant subsection, as approved in 2022, provides, amongst other separately sufficient criteria, that there will be a substantial and unreasonable (nontrespassory) interference with the use and enjoyment of land for the purposes of private nuisance if an activity or condition attributable to an actor:²³³

"effectively renders the land, or a significant portion of it, unavailable or insecure for ordinary use or enjoyment by the possessor, and ... does not comport with customs or expectations in the locality concerning appropriate activities or conditions on land".

In discussing this liability for nuisance, the following draft commentary is given on the relevant subsection, in terms which provide a very close echo of Bramwell B's test of "common and ordinary":²³⁴

"Subsection 1(b) identifies as unreasonable those interferences with use and enjoyment that result from activities or conditions that are inappropriate to the location in which they take place or violate settled expectations among persons in the locality.

As has long been emphasized by the courts, an activity or condition can amount to an unreasonable interference if the activity or condition is out of place in the locality in which it occurs ... The character of the locality—whether it is urban or rural, industrial or residential—is relevant largely because it sets reasonable expectations for possessors of land in that locality. In other words, a court should assess the nature and extent of the burden imposed on a nuisance plaintiff in light of prevailing norms or expectations in the locality as to the sort of burdens one is expected to endure without legal recourse ... Courts sometimes express the locality rule by ruling that a 'normal' use of land will not give rise to liability for nuisance."

TfNSW also submitted that the dissenting approach should be applied in Australia because the concept of a "common or ordinary" use had a resonance with the concept of non-natural use in the doctrine developed from Rylands v Fletcher,²³⁵ which has been subsumed in Australia into the law of negligence.²³⁶ But, although there is a "certain similarity" between private nuisance and the rule that derived from Rylands v Fletcher, "[t]here are indeed well marked differences between the two juristic concepts".²³⁷ Thus, in Gartner v Kidman,²³⁸ Windeyer J pointed out that in the law of nuisance the better place to start is not with the "difficult" concept of a non-natural use but with the formulation of Bramwell B in Bamford v Turnley, which exempted from constituting a nuisance those uses that were for "common and ordinary" purposes and which were "conveniently done".

The actions of TfNSW were a nuisance

A substantial interference with Hunt Leather and Ancio Investments' enjoyment of land

In these appeals there was no dispute that the acts of TfNSW, in planning and procuring the construction of the SLR, and therefore being responsible for it, involved a substantial interference with the enjoyment by Hunt Leather and Ancio Investments of their liberties in relation to the land upon which they conducted their businesses on George Street and Anzac Parade, which businesses were ordinary purposes of the use of land in the relevant localities.

The construction procured by TfNSW for the purpose of a light rail was not common and ordinary

Over the century and a half in which Bramwell B's test for nuisance has been applied, many of the cases in which the "common and ordinary" test was applied involved building and construction. No special rule existed for building and construction cases. Where the purpose for the use of land was properly characterised in general terms as "building and construction" it was often held that "temporary operations, such as demolition and re-building", were "part of the normal use of land" provided that those operations were done "in view of the developments of the day".²³⁹ As Jordan CJ expressed the point: "in a residential locality the pulling down or erection of a building almost inevitably causes a considerable amount of temporary annoyance to neighbours, but this must be put up with so long as the work is done reasonably".²⁴⁰
Those cases of construction involved work done for a "lawful and ordinary purpose",²⁴¹ consistent with the reasonable expectations of a residential, or mixed residential and industrial, locality. The work would only amount to a "residential nuisance[]"²⁴² if the manner of construction was not convenient in the sense that the construction was not performed in a reasonable and proper manner having regard to any interference with the plaintiff's enjoyment of land for ordinary purposes.²⁴³ Those cases contrast, for example, with the construction considered in Fearn v Board of Trustees of the Tate Gallery²⁴⁴ for the uncommon purpose of creating a viewing gallery from which members of the public were invited to look out of the building, or the construction considered in Hill v Managers of Metropolitan Asylum District²⁴⁵ for the uncommon purpose of "erection and maintenance of an asylum" for smallpox patients (found by the jury to be a nuisance "per se").
Hunt Leather's commercial premises on George Street in the Central Business District of Sydney was located in an area "densely populated by buildings, both new and old, retail shops, apartments, department stores, restaurants and food stores".²⁴⁶ Ancio Investments' commercial premises on Anzac Parade in Kensington was on a main road in a mostly residential area and easily accessible to the public. Kensington is a suburb of Sydney described in a report before the trial judge as having "a high prevalence of apartments, which are primarily located close to Anzac Parade ... These are home to many students, young singles and couples. Kensington also has grand Victorian and Federation style family homes." Anzac Parade was described as "a unifying feature of ... Kensington and home to many types of businesses and facilities". This case has been conducted throughout on the assumption that the same answer should be given to the questions of whether the purpose of the use of land by TfNSW was common and ordinary in George Street and in Anzac Parade.

Whether the light rail construction works procured by TfNSW were conveniently done

For the reasons above, and subject to defences, a nuisance was committed by TfNSW in procuring the construction works, which: (i) involved a substantial interference with the enjoyment of land by Hunt Leather and Ancio Investments for ordinary purposes in the relevant localities; and (ii) were for the purpose of installing the SLR, which was not common and ordinary. It is strictly unnecessary, therefore, to consider Issue 3 and whether TfNSW satisfied its onus of establishing that the construction works, or any part of them, were conveniently done. As will be seen, however, the same issue, with the same onus, arises in relation to the defence of statutory authority raised by TfNSW.
It suffices to say that this issue was raised as separate claims for private nuisance, Case C, by Hunt Leather and Ancio Investments, who asserted that even if the works procured by TfNSW were common and ordinary, the conduct of TfNSW caused a nuisance for part of the period. The nuisance for the part of the period identified by Mr Griffith as exceeding the reasonable timeframes for occupation of the fee zones adjacent to the land of Hunt Leather and Ancio Investments, as set out in the amended IDP, was said to arise due to the failures by TfNSW to: (i) identify unknown utilities and enter into agreements with utility providers prior to entry into the Project Deed; and (ii) ensure that the terms of the Project Deed would disincentivise delay by the contractor.
As explained above,²⁵³ even if the construction of a light rail was a common and ordinary purpose, once Hunt Leather and Ancio Investments had identified by reference to some evidence an asserted unreasonable delay caused by TfNSW, the onus was on TfNSW to establish that it had used the relevant roads in a manner that reasonably minimised the extent of the substantial interference with the ordinary enjoyment of land by Hunt Leather and Ancio Investments. That onus could not have been discharged by leading no evidence on the issue and instead relying upon alleged deficiencies in the evidence of Mr Griffith.

Two "defences" to nuisance

Liability for nuisance is not absolute. In particular, TfNSW relied at trial, on appeal to the Court of Appeal, and in this Court upon two "defences" to liability. The first is not strictly a defence but a heightened obligation for a plaintiff that is imposed by s 43A of the Civil Liability Act. The second is a defence of statutory authority.

Civil Liability Act, s 43A

Part 5 of the Civil Liability Act is entitled "Liability of public and other authorities". A "public or other authority" is relevantly defined in s 41 as "any public or local authority constituted by or under an Act".²⁵⁴ That includes TfNSW, which, as earlier explained, is constituted under the TA Act.
Sections 43 and 43A of the Civil Liability Act are complementary provisions which, respectively, involve liability based on breach of statutory duty and liability based on exercise or failure to exercise a special statutory power. Section 43A relevantly provides:

"(1) This section applies to proceedings for civil liability to which this Part applies to the extent that the liability is based on a public or other authority's exercise of, or failure to exercise, a special statutory power conferred on the authority.

(2) A special statutory power is a power:

(a) that is conferred by or under a statute, and

(b) that is of a kind that persons generally are not authorised to exercise without specific statutory authority.

(3) For the purposes of any such proceedings, any act or omission involving an exercise of, or failure to exercise, a special statutory power does not give rise to civil liability unless the act or omission was in the circumstances so unreasonable that no authority having the special statutory power in question could properly consider the act or omission to be a reasonable exercise of, or failure to exercise, its power."

Section 43A is only loosely described as a "defence" in the sense that a defendant must plead the facts that engage the operation of s 43A.²⁵⁵ Once s 43A is engaged, it operates to transform the plaintiff's cause of action into one that requires proof of the heightened standard of unreasonableness described in s 43A(3) before the plaintiff can establish liability based upon the exercise of (or failure to exercise) the special statutory power.
There may be doubt about whether s 43A applies to claims for private nuisance. On the one hand, the text of s 43A is not confined to actions in the law of torts for negligence. Unlike s 5A, which provides that Pt 1A of the Civil Liability Act "applies to any claim for damages for harm resulting from negligence", s 40(1) provides that Pt 5 "applies to civil liability in tort" and s 40(2) provides that Pt 5 "extends to any such liability even if the damages are sought in an action for breach of contract or any other action". On the other hand, the extrinsic materials suggest that s 43A was enacted in response to a claim for negligence in relation to the provision of health services,²⁵⁶ and the focus of s 43A is on an exercise of, or failure to exercise, a particular statutory power rather than the relative uses of land which are the focus of the law of private nuisance.
In any event, it was properly common ground in these appeals that an assessment of whether liability is based on a breach of statutory duty (s 43) or based on the "exercise of, or failure to exercise, a special statutory power" (s 43A) requires characterisation of the plaintiff's claim.²⁵⁷ In particular, the alleged conduct of the defendant must be characterised to determine, as a matter of substance, whether or not the plaintiff's claim is "based on" conduct which involves the exercise of a power that is of a kind that persons generally are not authorised to exercise without specific statutory authority.²⁵⁸

Civil Liability Act, s 43A does not apply

There may be doubt about whether s 43A applies to a claim for private nuisance. But that issue need not be resolved on these appeals because even if s 43A were applied to a claim for private nuisance, it would not be engaged by the conduct of TfNSW.
TfNSW submitted that the proper characterisation of the claims for nuisance against it involved two elements: (i) the relevant interference with the interest of Hunt Leather and Ancio Investments in their land; and (ii) TfNSW's responsibility for that interference because it developed, planned, procured, and organised the works that caused the interference. The second element was said to involve the entry by TfNSW into the Project Deed by exercise of the power in s 104O ("Development and operation of light rail systems") of the TA Act and the general powers conferred to give effect to the functions of TfNSW in s 3E(1).²⁵⁹
Every public authority that is not a natural person can only be directly liable for the torts of others by attribution of the conduct of those others to the public authority.²⁶⁰ The submission of TfNSW treats the acts of TfNSW, which procured the construction works and were therefore the basis for an attribution of responsibility for nuisance to TfNSW, as the acts upon which "the liability is based" for the purposes of s 43A of the Civil Liability Act. The Court of Appeal correctly rejected such an argument. The Court of Appeal reasoned that any relevant acts upon which liability in private nuisance was based were the acts of doing the construction works themselves, rather than the acts of TfNSW, under a statutory power, of procuring those works. The liability in private nuisance was based on the physical acts not on the reason (ie, procurement) that those acts were attributed to TfNSW.²⁶¹ Section 43A does not apply a heightened unreasonableness standard to the reason for attributing to a party the acts upon which tortious liability is based.
The submission of TfNSW, if accepted, would require s 43A to operate in a very different manner from the cognate provision in s 43 of the Civil Liability Act. The heightened unreasonableness standard for a claim based on breach of statutory duty under s 43 necessarily focuses upon the acts or omissions themselves. By contrast, the submission of TfNSW treats the heightened unreasonableness standard in s 43A as concerned with both the acts or omissions that cause the nuisance and the process by which the statutory authority authorises its employees or contractors to act. The latter is not a natural understanding of the basis of liability. In any event, and reinforcing the same point, the power in ss 104O and 3E of the TA Act (read with cl 9(1) of Sch 1 in particular) to enter into a contract is a power of a kind that persons generally are authorised to exercise without specific statutory authority.

Defence of statutory authority

There is in England a long-standing defence of statutory authority where, despite the absence of any express statutory authority to create a nuisance, an implied authority was found to exist if the creation of a nuisance was shown by the defendant to be the "inevitable consequence" of the exercise of a statutory power.²⁶³
This form of the defence of statutory authority based on "inevitable consequences" is sometimes also expressed as justifying or excusing all consequences that are shown by the defendant to be "necessarily arising" from the defendant's actions.²⁶⁴ In this context, "inevitable consequences" or the consequences "necessarily arising" are not concerned with "what is theoretically possible but what is possible according to the state of scientific knowledge at the time, having also in view a certain common sense appreciation, which cannot be rigidly defined, of practical feasibility in view of situation and of expense".²⁶⁵
The same form of the defence of statutory authority has long been recognised in Australia. In New South Wales, from 1915, s 3 of the City and Suburban Electric Railways Act 1915 (NSW) created a power to perform certain railway works, listed in a schedule to that Act. But the legislation did not exclude liability for nuisance beyond the terms upon which the activity had been authorised.²⁶⁶ Indeed, many years later, in the decision in Fisher v Codelfa Construction (Australia) Pty Ltd,²⁶⁷ upon which TfNSW relied, a private nuisance was held to arise because the conduct of the defendant was not within the conditions of statutory authority under that Act. The defence of statutory authority was explained by Griffith CJ in Fullarton v North Melbourne Electric Tramway and Lighting Co Ltd:²⁶⁸

"In the case of undertakings such as railways, tramways, telegraphs or telephones, it is obvious that the authorized works cannot be carried out without doing many things that are nuisances at common law, such as the erection of posts and laying of rails on highways and stretching wires above them. Such nuisances must be taken to be authorized."

In Benning v Wong,²⁶⁹ Windeyer J (expressing a view that his Honour said accorded with that of Barwick CJ²⁷⁰) described it as "well settled" that there is a defence of statutory authority where a defendant discharges an onus of showing that the consequence complained of was inevitable.²⁷¹ Windeyer J gave the example of "emission of sparks from coal-burning steam locomotives" as "an unavoidable incident of their normal use".²⁷² Although Barwick CJ and Windeyer J were in dissent in that case, the only member of the Court in the majority to address the defence of statutory authority based on inevitability was Owen J, who said that he did "not think it has ever been doubted, at least since Metropolitan Asylum District v Hill,²⁷³ that where a body purporting to act under statutory authority is sued for committing what is prima facie a nuisance, it is for it to show that its statutory authority could not be carried out without creating that nuisance".²⁷⁴ Owen J later added that in order to prove inevitability it was necessary for the defendant to establish that they "had taken all reasonable precautions to avoid creating a nuisance".²⁷⁵
In Benning v Wong,²⁷⁶ Windeyer J recognised another manner in which a defence of statutory authority could arise. Even if the nuisance is not shown to have been inevitable, his Honour held that a defendant will have a defence of statutory authority "in a case where the work or activity authorized by statute can, by the exercise of due care and skill by the undertaker be performed without creating a nuisance or doing other harm" but the statutory undertaker can show that they have "done the work properly, in a reasonable way and not negligently—the word 'negligence' being used here in a special sense". The "special sense" of a lack of "negligence" in this context requires the undertaker "to carry out the work and conduct the operation with all reasonable regard and care for the interests of other persons".

The statutory scheme

TfNSW was established as a corporation under s 3C of the TA Act with objectives, under s 3D, including "to plan for a transport system that meets the needs and expectations of the public" and "to promote the safe and reliable delivery of public transport and freight services". The functions given to TfNSW under the TA Act include developing transport infrastructure on behalf of the State, which includes "carrying out development for the purposes of or incidental to transport infrastructure", "facilitating, managing, financing or maintaining any such development", and "carrying out any function ancillary to any such development". An ancillary function is to "enter into contracts or arrangements with any person in connection with the exercise of TfNSW's functions".²⁸⁵
Section 104O(1) of the TA Act provides that "TfNSW may develop light rail systems, or facilitate their development by other persons." A "light rail system" is relevantly defined as "a system for the provision of light rail services along a route declared"²⁸⁶ and provision is made for regulations to "declare a route along a road or through other land to be the route of a light rail system".²⁸⁷ "Development" for the purposes of a light rail system includes "anything that is incidental to the carrying out of any such development"²⁸⁸ and does not require development consent under Pt 4 of the Environmental Planning and Assessment Act 1979 (NSW) ("the EPA Act").²⁸⁹
On 11 September 2015, the Transport Administration (General) Amendment (Light Rail) Regulation 2015 (NSW) ("the TA Regulation"), consistently with s 104N(2) of the TA Act, declared the route for the SLR. The route declared by the TA Regulation included George Street and Anzac Parade.²⁹⁰
The SLR also required ministerial approval as "critical State significant infrastructure"²⁹¹ within the meaning of the EPA Act.²⁹² Following an application by TfNSW, which identified effects such as increased noise and vibration and loss of access to private property, and a report by the Secretary of the New South Wales Department of Planning and Environment, approval was granted by the Minister, subject to conditions.

TfNSW has a partial defence of statutory authority

Neither at trial, nor on appeal to the Court of Appeal, did TfNSW assert that the EPA Act or the Roads Act impliedly conferred upon it any defence to the tort of private nuisance. Nor was it suggested that either statute contributed to any change in the character of the locality of George Street, in the Central Business District, or of Anzac Parade in Kensington. On appeal to this Court, that legislation was relied upon only as a vague factor of indeterminate weight which might, in all of the circumstances, demonstrate that the planning and procuring of the SLR involved social utility relevant to a reasonable balancing of the relative interests of the parties. For the reasons already explained, the test for a private nuisance does not permit legislation to be used in that way, separately from its relevance as a defence of statutory authority, as a factor in a broad instinctive synthesis of reasonableness.²⁹⁵
The defence of statutory authority in this case therefore depends upon the interpretation of ss 3E (read with Sch 1) and 104O(1) of the TA Act, and the TA Regulation, which empowered TfNSW to engage in preliminary work, enter into the Project Deed, and procure the construction of the SLR over the declared route in the manner which caused a substantial interference with Hunt Leather's and Ancio Investments' enjoyment of land for ordinary purposes in the relevant localities.
TfNSW argued that it was under a duty to perform its functions (including the function in cl 3 of Sch 1 to the TA Act to develop transport infrastructure), and to exercise the power in s 104O(1), by planning and procuring the SLR and that, as a result, the required test to make out the defence of statutory authority effectively became a question of breach of statutory duty by the negligence of TfNSW. The effect of this submission would seem to be that the duty to perform a statutory power necessarily provides a complete defence to a claim for private nuisance, leaving a plaintiff to assert a separate claim for breach of statutory duty, such as by negligence in the exercise of the power. It is unnecessary to consider this submission because its premise is not correct. In the TA Act, both s 104O(1), and the function in cl 3 of Sch 1, use the permissive "may". They are part of a broad range of widely expressed statutory powers. Neither power is accompanied by a duty upon TfNSW to plan or procure a light rail.
Nevertheless, the powers to plan and procure a light rail in the TA Act, coupled with the declaration of the route of the light rail in the TA Regulation, impliedly authorised any private nuisance that would be committed merely by a substantial interference arising from the departure from the reasonable expectations of the locality in establishing a light rail on that route (being a use of land for an uncommon or abnormal purpose). In other words, the authority for the SLR, and the approval of the route, under the TA Act and the TA Regulation, necessarily provided a defence to any claim for private nuisance based on the works not being common and ordinary. A similar point was made in , when Windeyer J gave the example of the defence of statutory authority applying to a company that was authorised by statute to carry on a railway undertaking "and it does so in the place and by the means authorized". The company "is not liable for harm done, not caused by negligence but in the ordinary and normal use of the railway ... in the due exercise of its statutory powers".

Do damages include reasonable litigation funding costs?

A further question²⁹⁷ that arose before the trial judge, and which was the subject of a separate judgment,²⁹⁸ was whether group members to whom TfNSW was liable for private nuisance, and who had entered into a litigation funding agreement in connection with the proceedings, were entitled to claim as damages their reasonable litigation funding costs without needing to show: (i) that the nuisance of TfNSW rendered them impecunious so as to require litigation funding; (ii) that they would have pursued their claims against TfNSW without litigation funding if they had the means to do so; or (iii) that they negotiated over the terms of the litigation funding agreement. It seems that this issue had never been decided prior to this case, although related claims have been held to be reasonably arguable.²⁹⁹ Both the trial judge³⁰⁰ and the Court of Appeal³⁰¹ held, more generally, that litigation funding costs were not recoverable as damages. That conclusion was correct.
The context in which this question arose was the litigation funding agreement entered into by various group members, by which the funder, International Litigation Partners No 16 Pte Ltd, undertook to pay all reasonable legal costs and disbursements associated with the litigation, to meet any adverse costs orders and provide security for costs, and to provide litigation management services. There was evidence that without the litigation funding agreement Hunt Leather and Ancio Investments would not have the financial resources to pay the legal costs of the proceedings or to take on the risk of adverse costs orders. In exchange for the funder's undertakings, the group members agreed to reimburse the funder for its costs and to pay a funding commission that ranged between 25% and 40% of any settlement or judgment sum. In the case of Hunt Leather and Ancio Investments, the commission was 40%. The amount of the litigation funding costs claimed by Hunt Leather and Ancio Investments as damages was that 40% commission.³⁰²
Hunt Leather and Ancio Investments submitted that they suffered loss by incurring the funding commission as a cost of vindicating their claims for private nuisance for the benefit of eliminating: their exposure to costs; their liability for adverse costs orders; and their liability to give security for costs. Hunt Leather and Ancio Investments also argued that the 40% commission was a loss that Hunt Leather and Ancio Investments would not have incurred but for the private nuisance of TfNSW. They argued that, despite the doubts expressed by the Court of Appeal, that loss was reasonably foreseeable.

Conclusion and orders

Hunt Leather and Ancio Investments have succeeded in part in their appeals, in effect restoring the result reached by the trial judge. The trial judge made orders for costs which apportioned the costs between Hunt Leather and Ancio Investments and TfNSW, based upon matters including the unsuccessful claims brought for public nuisance and the similarly unsuccessful arguments by Hunt Leather and Ancio Investments that the damages award should include reasonable litigation funding costs.³¹⁰ There is no basis to disturb those costs orders.
In each appeal, orders should be made as follows:

(1) Appeal allowed in part.

(2) The orders of the Court of Appeal of the Supreme Court of New South Wales made on 18 September 2024 be set aside and, in their place, it be ordered that the appeal and cross-appeal be dismissed with costs.

(3) The respondent pay the appellants' costs of the appeal.

JAGOT J.

Overview

Transport for NSW ("TfNSW") is a statutory corporation defined as a government agency constituted under the Transport Administration Act 1988 (NSW).³¹¹ In accordance with its statutory authority to do so, TfNSW planned and procured the construction of the CBD and South East light rail system in Sydney along public roads declared to be the route of that system ("the Sydney Light Rail").³¹² TfNSW intended, believed it had agreed, and publicly announced a construction program which, if implemented, it considered would minimise the disruption caused by the construction of the Sydney Light Rail, particularly to the occupiers of the properties adjoining the public roads forming the declared route, including by staging the construction and limiting the time of occupation by the design and construction contractor ("D&C Contractor") carrying out the construction works of areas along the route known as fee zones.
However, the D&C Contractor carrying out the construction works occupied the fee zones for periods that, on any view, far exceeded the periods TfNSW had intended, believed it had agreed, and publicly announced. As a result, the occupiers of properties adjoining these fee zones suffered the consequences of major construction activities immediately adjacent to their properties (noise, dust, vibration, hoardings, and restrictions of pedestrian and vehicular access) for far longer than TfNSW had intended, believed it had agreed, and publicly announced.
Beyond this, and subject to two points, it is convenient to observe that the reasons for judgment of Gordon and Edelman JJ identify the relevant circumstances in which the primary judge in the Supreme Court of New South Wales held TfNSW liable for the tort of private nuisance for the periods of time which the primary judge found TfNSW's D&C Contractor occupied the fee zones beyond that which the primary judge accepted to be reasonable,³¹³ and the relevant circumstances in which the Court of Appeal of the Supreme Court of New South Wales allowed TfNSW's appeal from the orders of the primary judge awarding damages to the representative plaintiffs.³¹⁴
The two points further to the circumstances disclosed in the reasoning of Gordon and Edelman JJ must be understood in the context of principle. To amount to a private nuisance an interference with the use and amenity of other land must be "unlawful",³¹⁵ unlawfulness depending on the interference being objectively both substantial and unreasonable. Both aspects, objective substantiality and unreasonableness, are questions of fact about the character of with the use and amenity of the plaintiff's land in all the circumstances, which include the nature of and reasons for the uses of the land of both the plaintiff and defendant.

"Actionability at common law therefore depends upon showing that the building works were conducted without reasonable consideration for the neighbours. On the other hand, immunity from liability arising out of the construction of works authorised by statute is subject to a condition that the undertaker will 'carry out the work and conduct the operation with all reasonable regard and care for the interests of other persons': per Lord Wilberforce in Allen v Gulf Oil Refining Ltd [1981] AC 1001, 1011."

Within this principled framework, Mr Griffith's evidence relating to the prolongation of the occupation of the fee zones was not evidence that the representative plaintiffs had to adduce and was not critical to their case. That they chose to adduce that evidence and confined their claims for damages to the period of the so-called prolonged occupation of the construction zones compared to that which TfNSW had intended, believed it had agreed, and publicly announced did not mean that they had (wrongly) accepted the burden of proving that the interferences were not an inevitable result of TfNSW doing the acts that the statute authorised and could have been avoided by the exercise of all reasonable care and skill in the doing of those acts. No complexity or error in the pleaded case or the way in which it was conducted by the parties in the courts below justifies an inversion of the onus of proof.
This said, another issue of principle, in respect of which I agree with the primary judge³³⁰ and the Court of Appeal,³³¹ is the irrelevance of the character of the use of the roads by the Sydney Light Rail being common and ordinary in the locality or uncommon and out of the ordinary in the locality. I consider it contrary to the law of nuisance as it exists and as it ought to remain in Australia for the distinction between a common and ordinary use in a locality or an uncommon and out of the ordinary use in a locality to play a determinative function in ascertaining liability for nuisance outside the scope of the concept of objective reasonableness.
On this basis, much of what follows explains my view that the distinction between a common and ordinary use in a locality or an uncommon and out of the ordinary use in a locality has no role to play in this case both as a matter of principle and in the circumstances where TfNSW was authorised by statute to develop or facilitate the development of a light rail service along the declared route and why, on the facts and evidence, TfNSW cannot succeed in its defence of statutory authority.³³² Otherwise, I agree with the reasons of Gordon and Edelman JJ on the inapplicability of s 43A of the Civil Liability Act, on which TfNSW also relied, and their reasons explaining why damages for the cost of obtaining litigation funding, as claimed by the representative plaintiffs, are not recoverable in the award of damages.
As will become apparent, the necessary question in this case should be understood to be (and always to have been) whether the NSW Parliament, by statute, authorised TfNSW to develop or facilitate the development of the Sydney Light Rail so as to cause, by its construction, what would otherwise be unlawful interferences with private proprietary rights of other occupiers of land without compensation for such unlawful interferences. The answer to that question, as a matter of proper statutory construction, is "no". The statutory immunity conferred by the NSW Parliament on TfNSW was qualified and not absolute. To be within the scope of its statutory immunity in the development or facilitation of the development of the Sydney Light Rail, it was for TfNSW to prove that the prima facie unlawful interferences were inevitable and could not be avoided by any exercise of reasonable care and skill on its part. This TfNSW did not prove. If the NSW Parliament had wished to provide TfNSW with an absolute immunity from liability in nuisance, it needed to do so in clear and unambiguous language. This the NSW Parliament did not do. Accordingly, the representative plaintiffs' appeals must succeed at least in part.

"Common and ordinary use"

This case exposes the limits of the utility of attempting to distinguish between what is a common and ordinary use in a locality or an uncommon and out of the ordinary use in a locality. The declared route for the Sydney Light Rail consists of public roads. George Street and Anzac Parade, the public roads which the land of the representative plaintiffs fronted, are major urban public thoroughfares in or close to the Central Business District ("CBD") of Sydney. The Sydney Light Rail is a tram service. A "tram" is a form of train designed to run on a "tramway" and a "tramway" is "a system of grooved tracks laid in urban streets, forming routes for the conveyance of passengers in trams".³³³ To my mind it seems somewhat incredible to suggest that the use of major public thoroughfares in or close to a major CBD for any conventional form of land-based public passenger transport service is an uncommon and out of the ordinary use when it is common knowledge that public transport options in many cities, in Australia (such as Melbourne) and throughout the world, include trams.
Other considerations also expose the limits of the utility of attempting to distinguish between a common and ordinary use in a locality or an uncommon and out of the ordinary use in a locality. In some cases, the identification of the relevant locality may be obvious. But even an obvious relevant locality has boundaries and what is a common and ordinary use on one side of a boundary may be an uncommon and out of the ordinary use on the other side of the boundary. And even an obvious relevant locality may have within its boundaries areas which have evolved from one prevailing kind of common and ordinary use into another prevailing kind of common and ordinary use or, at least, not an uncommon and out of the ordinary use. In the evolution of a locality, it may be difficult to determine the point at which a new use is uncommon and out of the ordinary or has become common and ordinary in that locality. Take as an example a low-density residential locality in which the only common and ordinary use is single-storey dwellings. Due to the need for more affordable housing, that locality may be rezoned to permit and encourage multi-storey residential towers. Is the first multi-storey residential tower to be developed in the locality an uncommon and out of the ordinary use and the tenth a common and ordinary use?
A locality also may be subject to a radical change in planning laws to discourage the then prevailing common and ordinary uses and encourage new uncommon and out of the ordinary uses. Mere compliance with environmental and planning laws, including conditions imposed on environmental and planning authorisations, has never been a defence to a nuisance.³³⁴ Similarly, benefit to the public from the carrying out of the impugned activity is of little if any significance, reflecting a principle that the private proprietary rights of one person (in the use and enjoyment of the amenity of their land) are not to be subjugated to notions of general public interest, at least not without clear and unambiguous statutory language to that effect. Is the implementation of governmental policy to increase the residential density of a residential area, with consequential major construction activities, to be thwarted because the ultimate end use (such as a high-density residential tower) is uncommon and out of the ordinary in the locality?

"[A] man who pulls down his house for the purpose of building a new one no doubt causes considerable inconvenience to his next door neighbours during the process of demolition; but he is not responsible as for a nuisance if he uses all reasonable skill and care to avoid annoyance to his neighbour by the works of demolition. Nor is he liable to an action, even though the noise and dust and the consequent annoyance be such as would constitute a nuisance if the same, instead of being created for the purpose of the demolition of the house, had been created in sheer wantonness, or in the execution of works for a purpose involving a permanent continuance of the noise and dust."

In other words, a person can demolish and erect a dwelling house on residential land without being liable for what might otherwise be a nuisance if they do the work with "all reasonable skill and care to avoid annoyance" to the use and amenity of other land. Precisely the same annoyance may be actionable nuisance, however, if the cause is "sheer wantonness" (such as demolishing structures as a hobby or intending to annoy others in their use and enjoyment of their land) or the purpose is to construct something other than a dwelling house. Taken literally, this latter example is baffling. So too is part of the reasoning in Andreae v Selfridge & Co Ltd,³⁵⁰ at least to the extent that it says that "it is part of the normal use of land, to make use, upon your land, in the matter of construction, of what particular type and what particular depth of foundations and particular height of building may be reasonable, in the circumstances, and in view of the developments of the day".³⁵¹
For one thing, the reasoning does not enable account to be taken of construction of a dwelling house that involves interferences that, on any view, are objectively substantial and unreasonable despite the taking of all reasonable care, such as perhaps a dwelling house requiring deep excavation or heavy equipment. Nor does the reasoning account for a case in which the thing to be constructed is not common and ordinary in the locality (for example, a scientific observatory in a residential area) but the interference from the demolition and construction is no greater than that which would be caused if the building to be constructed was a dwelling house. By what criterion is the interference from the demolition and construction then to be judged, particularly if the uncommon and out of the ordinary use, once constructed, will cause less interference with the neighbouring land than might be expected from a dwelling house?
Two things Andreae v Selfridge & Co Ltd does make clear, however, are, first, that whatever role the concept of the common and ordinary use of land is playing it "does not mean that the methods of using land and building on it are in some way to be stabilized for ever"³⁵² and, secondly, that "[t]hose who say that their interference with the comfort of their neighbours is justified because their operations are normal and usual and conducted with proper care and skill are under a specific duty, if they wish to make good that defence, to use that reasonable and proper care and skill".³⁵³ As discussed, the better view of these cases is that they are using the concept of the common and ordinary use of land in a locality as a proxy for assessing the objective reasonableness of the use.

"The right to build (and demolish) structures is fundamental to the common and ordinary use of land, involving as it does the basic freedom to decide whether and how to occupy the space comprising the property. It follows that interference resulting from construction (or demolition) works will not be actionable provided it is, in Bramwell B's phrase, 'conveniently done', that is to say, in so far as all reasonable and proper steps are taken to ensure that no undue inconvenience is caused to neighbours."

If demolition or construction works are "conveniently done", in the requisite sense of the taking of "all reasonable and proper steps ... to ensure that no undue inconvenience is caused to neighbours", what function does the concept of the common and ordinary use of land then perform other than potentially to defeat the objective reasonableness of the interference? It must also be doubtful that demolition can take its character from a proposed replacement use. Demolition is simply demolition irrespective of the proposed replacement use. And while the character of the proposed replacement use may influence the character of the construction (such as construction methods used and the duration of the construction), there is no necessary correlation between the character of a proposed replacement use and the nature or extent of any interference caused by the construction for that use. These considerations all point in the one direction – the common and ordinary use of land is a factor that may be relevant, even determinative, in answering the question whether an interference with the use and amenity of other land is objectively reasonable.
In the context of the present case, moreover, what function does the reciprocity involved in the "rule of give and take, live and let live"³⁶² in the ordinary and common uses of land have? From the perspective of the representative plaintiffs, the construction of the Sydney Light Rail could have been only all "give" and no "take".
That a person may take all reasonable care to avoid interfering with the use and amenity of other land and yet still be liable in nuisance does not mean that objective reasonableness lacks explanatory capacity in this field of liability. This principle derives from the observation in Broder v Saillard³⁶³ that "[i]t is no answer to say that the Defendant is only making a reasonable use of his property, because there are many trades and many occupations which are not only reasonable, but necessary to be followed, and which still cannot be allowed to be followed in the proximity of dwelling-houses, so as to interfere with the comfort of their inhabitants".³⁶⁴ The distinction being drawn here is between abstract and contextualised objective reasonableness, abstract reasonableness being always immaterial.³⁶⁵
As the Court of Appeal in this case recognised, this reasoning also unhelpfully conflates the conduct of the defendant with the nature of the interference when in reality, as Lord Sales put it in , the cases expose that the relevant criterion of liability is better described as depending on "the issue of reasonableness as between the two parties located in a particular locality, not on the reasonableness of the defendant's use in the abstract".

"Pronouncements concerning the scope of nuisance as a tort avoid stating rights and duties as absolute. In respect of both what a man may do and what his neighbour must put up with, its criteria are related to the reasonable use of the lands in question. ...

It is not possible to define what is reasonable or unreasonable in the abstract. Each case depends upon its own circumstances."

The same approach was taken in Elston v Dore,³⁷⁴ in which Gibbs CJ, Wilson and Brennan JJ approved Lord Wright's statement in Sedleigh-Denfield v O'Callaghan that "it may broadly be said that a useful test is perhaps what is reasonable according to the ordinary usages of mankind living in society, or more correctly in a particular society".³⁷⁵ The concept of the ordinary usages of a particular society is not as narrow and inflexible as a common and ordinary use in a locality. It is not confined to the nature of the defendant's or the plaintiff's use. It is, rather, a concept embracing the nature and extent of the interference with the use and amenity of the plaintiff's land in its full context for the purpose of determining objective reasonableness of an interference.
Accordingly, Gartner v Kidman and Elston v Dore are authoritative and binding statements of the law in Australia that private nuisance requires a substantial and unreasonable interference with the use and amenity of land to be proved by a plaintiff, not a mere substantial interference if the defendant's use can be characterised as other than common and ordinary in the locality. The Court of Appeal was correct to reject the arguments of the representative plaintiffs to the latter effect.³⁷⁶
The reasoning of Lord Sales in Fearn v Board of Trustees of the Tate Gallery³⁷⁷ identifies several compelling reasons why a focus on objective reasonableness as a criterion of liability for private nuisance (leaving aside statutory authority cases) is to be preferred. This criterion: (a) does not stultify the evolution of land uses but still protects the use and amenity value of other land from interference which should be treated as unlawful; (b) avoids the arbitrariness that otherwise may be involved in considering first or new uses in an area; (c) enables the nature of the interference with the use and amenity value of other land to be considered, including the vulnerability of that use and amenity to interference, without the need to purport to categorise any such use as itself uncommon and extraordinary, and thereby logically reflects the necessary reciprocity as between land used for private purposes; (d) avoids the courts making unprincipled choices between one kind of uncommon and extraordinary use of land (a defendant's) and another kind of uncommon and extraordinary use of land (a plaintiff's); (e) explains why malicious acts causing a substantial interference are actionable regardless of the nature of the uses or the locality; (f) brings demolition and construction works under the rubric of a general principle without distorting them into examples of the ultimate use; and (g) reflects the common law's general permissive rather than prohibitive approach to the use of land, albeit subject to the rights of other occupiers to the use and amenity value of their land.

Defence of statutory authority

The Constitution Act 1902 (NSW) does not prevent the State from making laws authorising the acquisition or injurious affection of property without payment of compensation. Accordingly, provided it does so in language of sufficient clarity, a law of the State may authorise conduct that would otherwise constitute an unlawful interference with land and may also exclude or expropriate a cause of action for damages a person otherwise might have because of the acquisition or injurious affection.
Despite the assimilation of the rule in Rylands v Fletcher³⁸⁷ into the general law of negligence and the different conclusions reached,³⁸⁸ many of the relevant principles may be distilled from the reasoning in Benning v Wong.³⁸⁹ The principles should be understood as follows.
First, the question whether a statute authorises a person or body to commit a tort, including the tort of nuisance, is one of statutory construction.³⁹⁰
Second, in construing the statute, the "cardinal rule[]" to be applied is that for a statute to authorise an interference with common law rights without compensation, "unambiguous and compelling language" is required.³⁹¹ This is because it is "in the last degree improbable that the legislature would overthrow fundamental principles, infringe rights, or depart from the general system of law, without expressing its intention with irresistible clearness".³⁹² Consequences of this precept of statutory construction include, for example, that "the absence of compensation clauses from an Act conferring powers affords an important [but not conclusive] indication that the Act was not intended to authorise interference with private rights".³⁹³ Similarly, that a statute merely permits rather than requires an act to be done is also seen as an indication that the statute confers no immunity from liability but, rather, means that "the powers conferred must be exercised in strict conformity with private rights".³⁹⁴ While it has also been said that in a case where a statute requires an act to be done, proof of the interference being inevitable as a condition of immunity from liability falls away, the only requirement being that the act be done with all reasonable care and skill, it is, as explained below, difficult to distinguish between an interference which is inevitable and an interference which is unavoidable by the exercise of all reasonable care and skill. Unless the standard of inevitability is pitched at the level of the theoretical and not the practical, there should be no difference between an interference proved to be inevitable and an interference proved to be unavoidable by the exercise of all reasonable care and skill.

Statutory construction

The route for the light rail system was declared on 11 September 2015.⁴¹⁵ Because s 104N(1) of the Transport Administration Act provided that for the purposes of the Act "a light rail system is a system for the provision of light rail services along a route declared ...", TfNSW's power under s 104O(1) of the Act to "develop light rail systems, or facilitate their development by other persons" was confined to the route so declared.⁴¹⁶ That declaration provided that the light rail system had to run along the public roads, road related areas and other land specified in the declaration, which included a map. The terms of the declaration did not provide TfNSW with any choice as to the route of the light rail system.
By s 3C(2) of the Transport Administration Act, TfNSW was a government agency. By s 3C(3) the affairs of TfNSW were to be managed and controlled by the Director-General, meaning the Director-General of the Department of Transport. By s 3B(1) the Director-General and the chief executive of TfNSW were, in the exercise of their functions, subject to the control and direction of the Minister. This subordination to government control accords with the objects of the Transport Administration Act, which included to achieve an efficient, integrated, effective, and co-ordinated transport system. TfNSW's general functions as set out in Sch 1 required a high degree of integration with other agencies of the NSW Government. To the same end of whole of government integration and co-ordination, by s 3G, TfNSW "for the purpose of exercising its functions" could give directions to a range of other NSW Government transport related agencies and bodies in respect of the exercise of their functions. This included Roads and Maritime Services, the relevant roads authority which provided approval for the construction of the Sydney Light Rail along the public roads as necessary under the Roads Act 1993 (NSW).
Nevertheless, the key provision, s 104O(1) of the Transport Administration Act ("TfNSW may develop light rail systems, or facilitate their development by other persons"), is expressed in unequivocally permissive rather than mandatory terms. That is, the NSW Parliament did not subject TfNSW to a statutory duty to ensure the development of the Sydney Light Rail. Accordingly, the principle on which Marcic v Thames Water Utilities Ltd⁴¹⁷ was ultimately decided, that "if a duty is imposed by statute which but for the statute would not exist, and a remedy for default or breach of that duty is provided by the statute that creates the duty, that is the only remedy", is inapplicable. Equally inapplicable is any principle that a statute which requires an act to be done generally is to be construed as conferring immunity for that act subject only to the exercise of all reasonable care and skill to protect those whose private rights would otherwise be infringed.

Course of hearings below

The primary judge said that the question whether TfNSW had failed to exercise reasonable care in developing and facilitating the development of the Sydney Light Rail was difficult in circumstances where both parties disavowed any need to prove the exercise or non-exercise of reasonable care.⁴²⁴ The primary judge also said the issue was difficult to resolve as the failures the representative plaintiffs pleaded were "particularised in the context of the delay, rather than a breach of any duty of care".⁴²⁵
To the extent his Honour referred to the need to plead a duty of care, the observation is misconceived. As explained above, "negligence" in the tort of nuisance is a shorthand reference to the failure of a defendant to exercise all reasonable care and skill to avoid interfering with the use and amenity of another's land. The relevant point otherwise is his Honour's observation that insofar as the representative plaintiffs pleaded a failure to take reasonable care, they did so by particulars only of delay. This was correct in respect of the alternative claim referred to as the "Civil Works Delay". The alleged nuisance in "authorising or permitting the construction of the Project", however, was separately particularised in para 15 of the pleading by reference to "excessive noise", "excessive vibration" and "excessive dirt and dust".
On several occasions during the hearing before the primary judge, however, the representative plaintiffs confined their claims to the period by which occupation of the fee zones for construction was prolonged beyond that agreed to and published by TfNSW, adjusted as provided for in the amended IDP. While the representative plaintiffs did not formally abandon their whole of period claim based on "excessive noise", "excessive vibration" and "excessive dirt and dust", the confining of the period of their claims in this way no doubt explains why the primary judge did not deal with the case of alleged nuisance in "authorising or permitting the construction of the Project" as pleaded by the representative plaintiffs. Rather, the primary judge confined consideration of the "unreasonable" aspect of TfNSW's conduct in developing and facilitating the development of the Sydney Light Rail to the alleged period of prolonged occupation of the relevant fee zones.
In the Court of Appeal, the representative plaintiffs contended that the primary judge erred in finding that "an actionable nuisance would only arise and subsist whilst [TfNSW's] use of its land was unreasonable, even if that use was not a common and ordinary use of the land" and consequently in "holding that the substantial interference caused to the [representative plaintiffs'] land during the time that construction was planned to take in each Fee Zone according to the amended IDP did not constitute an actionable nuisance". According to the representative plaintiffs, the primary judge should have held that, as the use of the land was "exceptional" and not "common and ordinary", "the construction without more constituted an actionable nuisance in respect of any substantial interference with the use and enjoyment of land by the [representative plaintiffs]", so that the period of the actionable nuisance was the entirety of the occupation of each such fee zone.

Consequences for these appeals

It follows that ground 2 of the representative plaintiffs' appeals to this Court (that the Court of Appeal erred in holding that the representative plaintiffs had not established that TfNSW's use of the land was unreasonable so as to make TfNSW liable for either the entirety of the period of the construction or part of that period as held by the primary judge) must be confined to the period of liability as determined by the primary judge.
As foreshadowed, in dealing with the primary judge's conclusions about that period, the Court of Appeal, in effect, reversed the onus of proof. The representative plaintiffs had proved objectively substantial and unreasonable interferences with the use and amenity of their premises from the construction works for the entire period of occupation of the fee zones for construction. They had also proved that TfNSW's acts in developing and facilitating the development of the Sydney Light Rail, principally by the terms of the Project Deed, were a material cause of the interferences. Having proved those facts, it was for TfNSW to prove that: (a) the nature, extent and degree of the interferences with the use and amenity of the premises of the representative plaintiffs and their duration were an inevitable consequence of the development and the facilitation of the development of the Sydney Light Rail, on the basis that it was TfNSW which was in control of the decision-making process, but for the declared route and the nature of the use as a light rail system; and (b) TfNSW had exercised all reasonable care and skill in developing and facilitating the development of the Sydney Light Rail to avoid reasonably avoidable interferences in terms of their nature, extent and degree.
Instead, the Court of Appeal reasoned that:⁴²⁶

"The IDP could not on its face be regarded as anything like a reasonable estimate of construction time in any particular fee zone. It made no allowance for inclement weather. It made no allowance for the discovery of unknown utilities and their treatment. It made no allowance for various other contingencies. It may well have been the basis for the media release, but if so it was not a reasonable basis for any estimate of construction time in any particular fee zone."

In the circumstances described above, it was for TfNSW to prove, not the Court of Appeal to surmise, that the nature, extent and degree of the proved interferences and their duration were inevitable and unavoidable by TfNSW having exercised all reasonable care and skill in exercising its powers in developing and facilitating the development of the Sydney Light Rail.
The Court of Appeal's observation that the "amended IDP proceeded on the basis that no construction would commence until there was complete knowledge of the thousands of sub-surface utilities along the route" and it "was not established that it was possible, and if so how long it would take and whether that too would amount to a substantial interference with the enjoyment of the plaintiffs' land, to obtain complete knowledge of the unknown utilities"⁴²⁷ exposes the same kind of error. It was not for the representative plaintiffs to establish that the objectively substantial and unreasonable interferences with the use and amenity of their land which the construction caused could have been reduced in nature, extent and degree. That the representative plaintiffs confined their claims for TfNSW's liability to the period they contended was prolonged never meant that the onus was on the representative plaintiffs to prove a lack of inevitability of the interferences or a lack of reasonable care and skill by TfNSW.
That the Court of Appeal's reasons venture far into surmise (such as that it "seems most unlikely" the subsurface utilities could have been discovered "by a series of night works, with temporary resurfacing in time for the road to be reopened the following day"⁴²⁸) is indicative of the error in its approach. Where the private rights of an individual have been prima facie infringed by an exercise of statutory power as opposed to the performance of a statutory duty (as by TfNSW planning and procuring the construction of the Sydney Light Rail in a manner which caused objectively substantial and unreasonable interferences with the use and amenity of other premises) then, unless the statute provides in clear and unambiguous terms to the contrary, it will be for the body which exercised the power to prove that the infringement was an inevitable consequence of an exercise of the power and was unavoidable by the exercise of that power being undertaken with all reasonable care and skill. Both concepts, inevitability and unavoidability, are to be evaluated on the evidence by reference to considerations of objective reasonableness at the time of the exercises of the power. Not only is the onus of proof in this regard on the body exercising the power; as is always the case, the evidence "is to be weighed according to the proof which it was in the power of one side to have produced, and in the power of the other to have contradicted". In the present case, proceeding from a suppressed assumption that the proved interferences were not objectively unreasonable, the Court of Appeal erred in proceeding as if it was for the representative plaintiffs to prove a lack of inevitability and a lack of reasonable care and skill.

Elements of private nuisance

It will be rare that a determination of the content of the common law of Australia in the present day, especially so far as concerns a tort, will be as dependent as this case is on the common law of England and Wales. That this is so in this case is because the common law of this country and that of England and Wales in relation to private nuisance are both derived from the influential judgment of Bramwell B in Bamford v Turnley.⁴³⁵ Bramwell B's judgment has been repeatedly cited and applied over many years in England and Wales⁴³⁶ as well as by this Court.⁴³⁷ Thus the scope of the debate in this Court concerned the meaning and effect of Bamford and the cases that have applied that decision. Neither party submitted that any social or other factors prevailing in this country or any development in Australian law warranted any approach other than determining what Bamford stands for and how it has been interpreted. This Court was not invited to reformulate the principles applicable to private nuisance by, for example, subsuming them into the law of negligence as occurred with the rule in Rylands v Fletcher.⁴³⁸

Bamford and Fearn

In Bamford, Bramwell B described the applicable principle as being that "those acts necessary for the common and ordinary use and occupation of land and houses may be done, if conveniently done, without subjecting those who do them to an action".⁴³⁹ His Lordship described this as a "rule of give and take, live and let live".⁴⁴⁰ In Bamford, the Court found that the defendant's use of his land as a brick kiln to burn bricks to build his house was not a common and ordinary use of the land (although it was "not unnatural nor unusual") and that such a "not unnatural use" could not be justified even if it was only temporary or for the public benefit.⁴⁴¹ The plaintiff's action in private nuisance succeeded.⁴⁴²
The debate in this Court, and to an extent in the Courts below, about the effect of the case law that has developed from Bamford is broadly reflected in the recent competing judgments of Lord Leggatt (for the majority) and Lord Sales (for the minority) in Fearn v Board of Trustees of the Tate Gallery.⁴⁴³ Lord Leggatt's distillation of the cases was to the same effect as that of Gordon and Edelman JJ – namely, that to be a private nuisance the defendant's use of land must have caused a substantial interference with the claimant's ordinary use of land⁴⁴⁴ and either: (a) the activity complained of was not a common and ordinary use of the relevant land;⁴⁴⁵ or (b) even if it was a common and ordinary use, it was not "conveniently done".⁴⁴⁶ In this context, "conveniently done" means "done with proper consideration for the interests of the" claimant.⁴⁴⁷ It is for the person carrying out the activity that causes the substantial interference to demonstrate that it was "conveniently done".
Both Lord Leggatt and Lord Sales agreed that the fundamental principle was one of "give and take" as between neighbouring occupiers of land. However, Lord Sales treated the statement of Bramwell B in as a statement of a "simple form of defence" so that, even if a substantial interference with the claimant's land arose out of the common and ordinary use by the defendant of land, the defendant will not be liable if he or she establishes that the use of land was "conveniently done".

Unreasonableness and onus of proof

Read in isolation, the "principle" stated by Bramwell B in Bamford could be construed as only specifying the circumstances in which defendants will not be liable in private nuisance and does not otherwise address the circumstances in which they will be liable. However, such an approach reads Bramwell B's statement out of context and is inconsistent with the result in Bamford, where the uncommon character of the defendant's use that occasioned the substantial interference was determinative in the holding that the plaintiff succeeded in private nuisance. I otherwise agree with the analysis of Gordon and Edelman JJ of the authorities both in England and Wales and in this country that have considered Bamford.
While "[t]he idea of reasonableness" has been (accurately) described as being "firmly embedded in the law of nuisance",⁴⁶⁰ the relevant questions are at what point and how is "reasonableness" to be applied in this context? To adopt an approach of simply balancing various factors under the rubric of "reasonableness" or, as Lord Sales described it, the application of an "open‑textured objective reasonableness standard"⁴⁶¹ risks turning even the simplest of private nuisance cases into a broad‑ranging, prolonged and expensive inquiry out of all proportion to the interests at stake and the capacity of the parties to litigate. The position will only be worse if, at the point of determining whether there is a private nuisance, courts are required to undertake some normative assessment of the social utility of the parties' respective uses, especially if one party is a public authority and the other is a private citizen or corporation. Common law tests that impose such obligations on courts warrant particular scrutiny.
True it is that assessments of "reasonableness" inform many elements of various torts.⁴⁶² However, such assessments of reasonableness are usually undertaken within confined parameters⁴⁶³ and in circumstances where it is clear which party bears the legal or evidential onus of proof to establish the reasonableness of certain matters or conduct.⁴⁶⁴ In this case no clear parameters guiding the assessment of "reasonableness" were suggested or are otherwise apparent. While Lord Sales' approach would appear to accept that whether the substantial interference with the plaintiff's use or enjoyment of the land arose out of something other than a common and ordinary use of the defendant's land is an "important factor" in the assessment of reasonableness, that factor did not enjoy that status in the Court of Appeal in this case. While both the concept of reasonableness and many of the factors identified by Lord Sales that bear on that assessment of reasonableness are also applicable to the approach stated by Gordon and Edelman JJ (and Lord Leggatt), the latter approach provides a more structured framework in which that assessment is to be undertaken.

Stultifying land development

One of the concerns raised by Lord Sales in Fearn about treating the principle stated by Bramwell B in Bamford as specifying the elements of a cause of action in private nuisance was that the principle does not address the circumstance where neither party uses the land in a manner that is common and ordinary.⁴⁶⁹ However, parties who use their own land in a manner that is not common and ordinary do not become outlaws so far as the protection of the law of private nuisance is concerned. Instead they merely do not gain protection for a substantial interference with that particular use of the land at the expense of their neighbours' right to use their property as they see fit. The protection for common and ordinary uses of their land still subsists.
In Fearn, Lord Sales was also concerned that to treat the principle stated by Bramwell B in Bamford as specifying the elements of a cause of action in private nuisance risked the unjustified stultification of land development and conflicted with the policy of the law that people who own land are free to use that land as they wish.⁴⁷⁰ There is force in that concern. However, that concern is best accommodated by the approach of Lord Leggatt and that of Gordon and Edelman JJ, and by recognising that assessments of the nature of the locale as well as what is a common and ordinary use take place at the appropriate level of abstraction so that providing protection against substantial interferences with common and ordinary uses of land within a particular locale does not mandate uniformity in the use of that land. Otherwise, the approach of Gordon and Edelman JJ accommodates changes in land use in that uses of land that are unusual within a particular locality that do not occasion a substantial interference with the common and ordinary uses of the land of other persons are not actionable. Over time the manifestation of such unusual uses in a locality may result in their becoming common and ordinary uses in that locality in their own right. While planning permission is not decisive, the forms of use permitted by planning controls can form part of the assessment of common and ordinary uses within a particular locality.⁴⁷¹

The cases below and the grounds of appeal

As Gordon and Edelman JJ note, at trial the appellants identified three bases for the respondent's liability in private nuisance: Case A, Case B and Case C. Case B can be put aside, as it failed on the facts before the primary judge and that finding was not challenged in the Court of Appeal.⁴⁷²
Case A relevantly asserted that: (i) the respondent was responsible for the construction works, which substantially interfered with the enjoyment by the appellants of their rights as occupiers of the land on which they conducted their businesses; (ii) the construction works did not constitute a common and ordinary use of the land; (iii) s 43A of the Civil Liability Act 2002 (NSW) was not applicable; and (iv) a defence of statutory authority was not made out. Case A contended that there was a private nuisance for the entire period that there was a substantial interference with the appellants' common and ordinary use of the land.
Case C was similar to Case A except that Case C was put on the basis that, assuming it was found that the construction works constituted a common and ordinary use of the land, then the respondent failed to discharge its onus of proving that it took reasonable and proper precautions to prevent disruption to the appellants (and other group members). As part of Case C, the appellants submitted to the primary judge that, if the construction works constituted a common and ordinary use of the land, the Court should find that the continuation of the construction of the SLR was not reasonable beyond a certain duration. The appellants submitted that the only available guide before the Court as to the period for which the construction works were reasonable was the original Initial Delivery Program as reformulated in the Amended IDP.
Thus, by closing submissions at the trial Case C appears to have been confined to a claim for private nuisance in respect of only part of the period during which the construction works, according to the appellants, created a substantial interference with the appellants' ordinary use of the land, being that period for which the continuation of the construction works was not reasonable. Further, both Case A and Case C were put on the basis that the elements of a private nuisance accorded with what was stated by Lord Leggatt in Fearn⁴⁷³ and identified in this Court by Gordon and Edelman JJ.

The primary judge's findings and approach

The primary judge found that there was a substantial interference with the store of the first appellant in each appeal in the Strand Arcade on George Street between November 2015 and December 2017 and the restaurant of the second appellant in the first appeal (being also the third appellant in the second appeal) on Anzac Parade in Kensington between May 2016 and February 2019 for which the respondent was responsible. There is no challenge to those findings. The primary judge also found that the use of George Street and other roads comprising the SLR route for the purpose of constructing the SLR was not a common and ordinary use of those roads.
However, the primary judge did not accept that the law of private nuisance in Australia accorded with that stated by Lord Leggatt in Fearn. Instead, his Honour adopted an approach similar to that of Lord Sales save that his Honour considered that one factor bearing on the assessment of reasonableness is "the benefit of the [defendant's] activities to the public" – a factor not addressed by Lord Sales in Fearn.⁴⁷⁴ The primary judge accepted that the "[respondent] must have been entitled to arrange for the construction of the SLR along the specified route" because "[n]ot all interferences or impacts will give rise to an actionable nuisance" and that "[t]he principle of give and take permits landowners to use their land reasonably". However, his Honour was not satisfied that the respondent exercised reasonable care to protect the interests of business owners along the light rail route. His Honour concluded that the Amended IDP put forward by the appellants represented an appropriate measure for determining the point at which the continuation of the interference with the land became unreasonable.

The Court of Appeal's judgment

The Court of Appeal agreed with the primary judge's conclusion that the approach of Lord Sales in Fearn is more consistent with the law of private nuisance as developed in this country and rejected a challenge to the primary judge's conclusion that the construction works were not a common and ordinary use of the roads. However, the Court of Appeal upheld the challenge to the finding that, to the extent that the construction of the light rail took longer than the timeframes identified in the Amended IDP, there was actionable private nuisance.
The Court of Appeal considered that "the premise of the reasoning advanced by the [appellants in this Court] and adopted by the primary judge was that the occupation of the fee zones became tortious after the expiry of the times in the [A]mended IDP, with those times being based upon complete knowledge of the utilities prior to construction commencing". The Court of Appeal reasoned that, if that were to be the basis of liability, then the appellants had to establish two propositions: "first, that it was possible in some rational way to obtain complete knowledge of the utilities prior to construction"; and secondly, if that were possible, "how much interference would that investigation cause". The Court of Appeal considered that the first of those propositions was not established, and that it was "far from self-evident" that any pre-construction investigation would have reduced the interference with the appellants' enjoyment of the land. Further, the Court of Appeal reasoned that, even if those propositions were established, Case C failed because the appellants "did not demonstrate when the time taken for construction became actionable nuisance in light of the number of sub‑surface utilities that needed to be treated for the purposes of construction. Whether the time in fact taken [in the construction of the SLR] in light of that universe of practical issues and challenges was unreasonable was not the subject of evidence or analysis."

Difficulties with the Court of Appeal's approach

Even if one accepts the primary judge's analysis of the law of private nuisance as stated by Lord Sales in Fearn, as the Court of Appeal said it did, the appellants did not have to establish any of the matters just noted to make out either Case A or Case C. Those propositions would only be necessary to establish a private nuisance if an essential integer of the appellants' case was that they had to prove that the time taken to construct the SLR was unreasonable. The appellants never purported to assume such a burden and the primary judge did not find that any such burden was imposed on the appellants.
Consistent with the primary judge's embrace of Lord Sales' reasoning in Fearn, his Honour's findings represented an assessment that, in all of the circumstances of the case, including the relationship between the appellants and respondent, the interference with the appellants' use and enjoyment of the land for the period beyond that specified in the Amended IDP was unreasonable. However, the primary judge neither assumed nor found that the time periods in the Amended IDP represented a reasonable period to construct the SLR.
On the primary judge's and Lord Sales' approach the reasonable time it would take to construct the SLR is at most only a factor in the assessment of what is "reasonable".⁴⁷⁵ Let it be supposed that it was affirmatively demonstrated that the minimum reasonable time to construct the SLR was 20 years. It could not be seriously doubted that, even though that was the minimum reasonable time it would take to construct the SLR, a substantial interference with the appellants' properties for that period as a result of the construction of the SLR would still amount to a private nuisance given that it would effectively destroy those properties of any utility whatsoever.
Ground 1 of the appeals contends that the Court of Appeal erred in holding that the substantial interference to the appellants caused by the respondent's uncommon and extraordinary use of land along the SLR route was not sufficient to establish actionable private nuisance. It follows that, subject to the issues raised by the respondent's notices of contention, this ground should be upheld and the appeals allowed.
Ground 2 contends in the alternative that the Court of Appeal erred in holding that the appellants had not established that the respondent's use of the land was unreasonable. This ground is predicated on an acceptance of the approach of Lord Sales in Fearn. As explained, the Court of Appeal appeared to accept that approach, but failed to apply it. However, as that predicate is not established this ground does not arise.

Notices of contention − common and ordinary use

One ground of the respondent's notices of contention is that the Court of Appeal's orders should be sustained on the basis that the "construction" of the SLR, "being duly authorised by statute and development approvals", amounted to a common and ordinary use of the land.
In addressing this contention it is important to note that what constituted the interference with the appellants' use of their land was neither the infrastructure of the SLR as finally constructed nor the operation of the SLR but the construction activities undertaken to build the SLR.
As noted, the primary judge found that the use of George Street and other roads comprising the SLR route "for the purposes of constructing the light rail" was not a "common and ordinary use of those roads". The Court of Appeal's conclusion was arguably wider in that their Honours noted that the "roadway and footpath were occupied for the purpose of construction, in part to do work, in part to store equipment and materials, but mostly because it was not possible to complete the works [to construct the SLR] because of other steps which had first to be taken (such as treating thousands of utilities)". Their Honours concluded "[t]hat was not an ordinary use of the land dedicated as a road" because the "essential aspect of land being a road is that there be a right of public passage". On one reading of those findings, the use of land dedicated as a road for construction per se is not a common and ordinary use of that land, at least where rights of public passage are obstructed.
The respondent's challenge to this aspect of the primary judge's and the Court of Appeal's findings accepted that some restraint was required before such (concurrent) findings are interfered with, but submitted that was less so where those findings were described by the respective Courts as being of "relative insignificance" or not having "the significance that the [appellants] suggest", whereas that characterisation now assumes a much greater significance in this Court. That can be accepted. Further, if the Court of Appeal is to be taken as having found that the use of land dedicated as a public road for any construction the effect of which is to obstruct the public's right of way is not a common and ordinary use of such land, then their Honours erred as a matter of principle.
The statement by Lord Leggatt in Fearn that the "right to build (and demolish) structures is fundamental to the common and ordinary use of land"⁴⁷⁶ is as valid in this country⁴⁷⁷ as it is in England and Wales.⁴⁷⁸ Leaving aside any consideration of the particular locale, the position is no different for land being used as a road as opposed to a dwelling. If anything, more allowance and not less should be afforded for give and take in relation to construction on a road even where that construction obstructs the public's use of the road. Of their nature roads will incur wear and tear and may need to be upgraded or have facilities like footpaths, lights and footbridges erected on or near them. Construction work on land dedicated for a road is very much a common and ordinary use of such land.

Balance of issues raised by the notices of contention

I agree with Gordon and Edelman JJ in relation to the operation and application of s 43A of the Civil Liability Act and the respondent's defence of statutory authority.

Appeal and litigation funding costs

As noted, I agree with Gordon and Edelman JJ that the ground of appeal in relation to the recoverability of litigation funding costs should be rejected for the reasons their Honours give.

Orders

I agree with the orders proposed by Gordon and Edelman JJ.

Footnotes

Section 3C of the Transport Administration Act. ↩
Section 3E and Sch 1 of the Transport Administration Act. ↩
Clause 9 of Sch 1 of the Transport Administration Act. ↩
Sections 138, 139 and 144C of the Roads Act. ↩
Part 5.1 of the Environmental Planning and Assessment Act. ↩
Hunt Leather Pty Ltd v Transport for NSW (2023) 257 LGERA 1 at 21 [90]. ↩
Hunt Leather Pty Ltd v Transport for NSW (2023) 257 LGERA 1 at 110 [656]. ↩
Hunt Leather Pty Ltd v Transport for NSW (2023) 257 LGERA 1 at 109 [651], 110 [657]. ↩
Hunt Leather Pty Ltd v Transport for NSW (2023) 257 LGERA 1 at 149 [936]. ↩
Hunt Leather Pty Ltd v Transport for NSW (2023) 257 LGERA 1 at 135 [819]-[820], 137 [832]-[834]. ↩
Transport for NSW v Hunt Leather Pty Ltd (2024) 115 NSWLR 489. ↩
Transport for NSW v Hunt Leather Pty Ltd (2024) 115 NSWLR 489 at 516-519 [115]-[126].

Hunt Leather Pty Ltd v Transport for NSW; Hunt Leather Pty Ltd v Transport for NSW [2025] HCA 53

At a glance

Result

Key principles

Issues before the court

Plain English Summary

Deep Dive

What happened

Cited legislation

Why the court decided this way

Before and after state of the law

Key passages with plain-English translation

What fact patterns trigger this precedent

How later courts have treated it

Still-open questions

Judgment

Private nuisance at common law in Australia

Substantial and unreasonable interference in the present case

Section 43A of the Civil Liability Act

Introduction

Background

The planning works performed and the construction works procured by TfNSW

The effect of the construction of the SLR on Hunt Leather and Ancio Investments

The evidence of Mr Griffith

The three forms of the private nuisance claims at trial

The decisions of the trial judge and the Court of Appeal

The test for nuisance

The defendant's substantial interference must be one that is not ordinary or not convenient

(i) The foundational case in 1862

(ii) The meaning of a "common and ordinary" purpose of use

(iii) The meaning of "conveniently done"

A dissenting approach: reasonableness in all of the circumstances

The actions of TfNSW were a nuisance

A substantial interference with Hunt Leather and Ancio Investments' enjoyment of land

The construction procured by TfNSW for the purpose of a light rail was not common and ordinary

Whether the light rail construction works procured by TfNSW were conveniently done

Two "defences" to nuisance

Civil Liability Act, s 43A

Civil Liability Act, s 43A does not apply

Defence of statutory authority

The statutory scheme

TfNSW has a partial defence of statutory authority

Do damages include reasonable litigation funding costs?

Conclusion and orders

Overview

"Common and ordinary use"

Defence of statutory authority

Statutory construction

Course of hearings below

Consequences for these appeals

Elements of private nuisance

Bamford and Fearn

Unreasonableness and onus of proof

Stultifying land development

The cases below and the grounds of appeal

The primary judge's findings and approach

The Court of Appeal's judgment

Difficulties with the Court of Appeal's approach

Notices of contention − common and ordinary use

Balance of issues raised by the notices of contention

Appeal and litigation funding costs

Orders

Footnotes

Legislation Cited (18)

Cases Cited (56)

Cited By (3)

AI Analysis