This is an application by the plaintiff for the costs of removal of a houseboat that was until 25 March 2020 moored over a rectangular area of the seabed in Pearl Bay on Middle Harbour. The relevant area is to the north-west of the shoreline, with its south-eastern boundary parallel to the shore at a distance of about 8 m out. The area is comprised in folio identifier 1/1146276. The defendant kept the houseboat moored at this location and occupied it as her residence pursuant to a lease of the seabed from the plaintiff.
On 13 August 2018 judgment was entered for the plaintiff for possession of the property. The Court's reasons were published on 13 August 2018: Roads & Maritime Services v Young [2019] NSWSC 1014. For a considerable time the defendant had not paid rent that was due to the plaintiff in respect of the leased area. The lease was therefore determined. On 30 September 2019 judgment was entered in the plaintiff's favour for $6,075.44 for rent plus $9.66 for each day after 30 September 2019 until possession should be recovered. On the same day an order was made that the defendant pay the plaintiff's costs of the proceedings.
Clause 13 of the lease contains the following provisions:
13.1 Removal of Lessees Fixtures by Lessee
(a) If notified by the Lessor in writing the Lessee must, at the Lessees cost, Remove the Lessee's Fixtures from the Leased Land and Licensed Area upon the expiration or earlier determination of this Lease […]
13.3 Failure to Remove Improvements and Fixtures
If the Lessee does not comply with cl 13.1 […] of this Lease then:
(a) the Lessor may Remove or partially Remove and dispose of the […] Lessee's Fixtures on the Leased Land and Licensed Area in such manner and on such terms as the Lessor determines, acting reasonably; and
(b) the Lessee must pay to the Lessor on demand the costs and expenses incurred by the Lessor in taking action under cl13.3(a) of this Lease
The term "Lessee's Fixtures" is defined Sch 1 of the Lease to include "pontoons". The defendant's houseboat comprised a dwelling constructed on a floating concrete pontoon. On 14 November 2019 the defendant was notified by the plaintiff in writing that she should remove her chattels from the houseboat and that it would be removed from the site if the defendant herself took no action to remove it. In this same letter of notification the defendant was directed to disconnect electricity and water from the houseboat and to remove all mooring blocks and chains. The plaintiff offered that it would have the houseboat towed to a location nominated by the defendant, at her cost. The defendant did not take up this offer and took no steps to disconnect services or to remove the houseboat from its moorings.
Under a writ of possession the Sheriff recovered possession of the property for the plaintiff on 9 December 2019. The defendant vacated the houseboat and it was secured. The plaintiff then engaged Polaris Marine Pty Ltd to effect removal. The work commenced on 18 March 2020 and was completed on 25 March 2020. It required, first, the attendance of a tug to place a barge alongside the pontoon. From the deck of the barge deconstruction of the defendant's dwelling was undertaken. The barge was then removed and the defendant's pontoon was unmoored and towed from Middle Harbour to Rozelle Bay for demolition and disposal. A crane barge was subsequently used to remove the mooring blocks to which the defendant's pontoon had been anchored. Divers were deployed to undertake a clearance survey of the seabed.
The plaintiff incurred costs of $9,154.20 in disconnecting services from the houseboat, boarding it up to make it secure pending removal, dismantling the gangway access, disposal of the gangway materials and debris and installing a temporary fence to prevent access to the houseboat until such time as it could be towed away. Because of the age of the houseboat it was necessary to have it surveyed for the presence of any hazardous materials, in particular asbestos. The cost to the plaintiff of this survey was $2,585. The cost of deconstruction of the houseboat and removal of the pontoon was $132,000. An alternative quotation was obtained at $98,000 but this was on the basis that the houseboat, intact, would be towed away for demolition elsewhere. This carried the risk of capsize during the tow. It was reasonable for the plaintiff to adopt the more expensive but less risky method of removal.
The plaintiff invoked the Uncollected Goods Act 1995 (NSW) as justification for demolishing and disposing of the dwelling that was constructed on the pontoon and for having the pontoon itself scrapped. In order to determine whether the houseboat could be disposed of under s 20 of that Act the plaintiff considered it necessary to determine whether it had a value exceeding $100. For this purpose it commissioned a valuation report from a Mr Greg Lambert, at a cost of $4,469.91. Mr Lambert assessed the value of the houseboat as nil. This opinion is supported by the considerations that the dwelling structure on the pontoon was in a dilapidated condition, an assessment confirmed by photographs. Mr Lambert also relied upon indications that the houseboat was not waterproof and that, in the absence of any identifiable waste product discharge hoses, there must be doubt concerning the houseboat's compliance with waste management requirements.
The evident age of the houseboat raised the possibility that it would contain hazardous materials and this risk would likely eliminate any market for the houseboat. Further, Mr Lambert identified the absence of comparable sales upon the basis of which a value could be attributed. He noted that houseboats are now a prohibited development under planning laws that apply to Sydney Harbour so that no purchaser would be able to move this houseboat to any other location where a lease of seabed could be obtained the purpose of mooring it.
I am satisfied that all of the above amounts are payable by the defendant pursuant to cl 13 of the lease, with the exception of the cost of Mr Lambert's valuation. Clause 13.3(a) of the lease authorised the plaintiff to dispose of fixtures removed from the leased area, including the pontoon and dwelling. It was therefore not strictly necessary for the plaintiff to invoke the Uncollected Goods Act or to establish, for the purposes of that Act, that the value of the removed items was less than $100. It is quite understandable that the plaintiff should have obtained this evidence in order to deal with every eventuality, particularly having regard to the long history of litigation by the defendant with respect to the subject matter. However, in the events that have occurred, I do not consider that the cost of obtaining this valuation for more abundant caution can be laid at the feet of the defendant. Accordingly, the amount for which judgment will be entered for the plaintiff will be $143,739.20 and the defendant will be ordered to pay the plaintiff's costs of the application to recover the removal expenses.
On 20 March 2020 the Court notified the parties that the remaining issues in the proceedings, including the plaintiff's claim for its costs of removal of the houseboat, would be decided on the papers. Directions to the following effect were made:
1. Plaintiff to deliver to the judge's Chambers by 24 March 2020 the form of further orders sought, together with supporting affidavits and submissions, and at the same time to serve those documents on the defendant.
2. The defendant to deliver to the judge's Chambers by 1 April 2020 any affidavits or submissions relied upon by her.
On 24 March 2020, upon the application of the plaintiff by email, the times for compliance with the above directions were extended by one day for each party, to 25 March 2020 and 2 April 2020, respectively. The parties were notified of the extension by email on 24 March 2020. The plaintiff complied with the extended deadline applicable to itself. The defendant had filed nothing by 2 April 2020 and on 6 April 2020 requested deferral until the lifting of the government restrictions on movements that have been imposed since March of this year in response to public health concerns. The defendant claimed that under the restrictions she was unable to gain access to stored documents for the purpose of preparing her submissions and affidavits.
On 8 April 2020 the time for the defendant to comply with order (2) above was extended to 30 April 2020. On that date she forwarded to the Associate short minutes of proposed orders under which the plaintiff would be directed to provide her with certain documents by 18 May 2020 and she would respond to the plaintiff's affidavits and submissions by 1 June 2020. By email of 5 May 2020 from my associate the defendant was informed that this was unacceptable, that any material she wished to rely upon should be delivered to Chambers by 5:00 pm on Friday, 8 May 2020 and that a decision on the matter would be made early in the week commencing 11 May 2020.
No justification has been shown for a further extension of time as sought by the defendant. The facts bearing upon the plaintiff's application for its costs of removal are within a narrow scope. It appears incontestable that the defendant was obliged to remove the houseboat and that despite receiving notice to do so she failed to take any steps. If there is any contest about the reasonableness of the expense incurred by the plaintiff it should be a simple matter for the defendant to obtain from another marine contractor an alternative estimate and provide that to the Court. The defendant claims that she requires time in order to gain access to documents that are in storage. She has provided no description of the documents she is referring to and it is not apparent to me that any documents in storage could possibly be relevant to the plaintiff's claim with respect to removing the houseboat.
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Decision last updated: 12 May 2020