Van Beek v Lou (No 2)

Publication restriction: Nil

JUDGMENT

The Parties Seek a Vacation of the Hearing Date

1. The parties appeared before the Court at a mention late in the afternoon of 4 November 2025, prior the final hearing of the proceedings listed on 6 November 2025.

2. As explained below, the Court listed the matter for mention of its own volition due to non-compliance with the timetable for the preparation of the matter for hearing. At the mention an application was made to vacate the hearing to allow the parties further time to prepare. The Court acceded to the application but due to the late hour (the application concluded at around 6:00 pm) indicated that it would publish written reasons later, which it now does.

The Van Beeks Allege an Encroachment onto Their Lan****d

3. The Class 3 proceedings concern an encroachment dispute between the applicants, Nicholas Van Beek and Diana Van Beek (“the Van Beeks”), and the respondents, Yi Kun Lou and Olivia Lou (“the Lous”).

4. The Van Beeks’ land is adjacent to the Lous’ land. The western boundary of the Lous’ land is contiguous with the eastern boundary of the Van Beeks’ land.

5. In short, the Van Beeks allege that a 1.699 m2 portion of the Lous’ dwelling and shed encroaches onto their land at the rear of their property. They rely upon two surveys prepared by a now retired surveyor, Stephen Carr, on 16 March 2021 and 9 February 2022, respectively.

6. The encroachment is said to arise as a result of alteration works undertaken in 2003 and 2004 pursuant to a development consent granted by Leichhardt Municipal Council on 27 November 2002.

7. The construction certificate issued in relation to the consent on 18 March 2003 records the owner-builder’s name as Feng Yeng, who is Mr Lou’s late wife and the then joint registered proprietor (along with Mr Lou) of the Lous’ land.

8. The Van Beeks became the registered proprietors of their land in July 2013.

9. The Van Beeks seek compensation for the asserted encroachment.

The Relevant Legislation

10. The proceedings are brought under the Encroachment of Buildings Act 1992 (“Encroachment Act”). If it is demonstrated that the Van Beeks are “adjacent owners”, the Lous are the “encroaching owners”, and that the Lous’ buildings are “buildings” for the purpose of s 2 of the Encroachment Act, then s 3 of that Act governs applications for relief in respect of encroachments. It relevantly provides that:

3 Encroachments

(1) Either an adjacent owner or an encroaching owner may apply to the Court for relief under this Act in respect of any encroachment.

(2) On the application the Court may make such orders as it may deem just with respect to:

(a) the payment of compensation to the adjacent owner,

(b) the conveyance transfer or lease of the subject land to the encroaching owner, or the grant to the encroaching owner of any estate or interest therein or any easement right or privilege in relation thereto,

(c) the removal of the encroachment.

(3) The Court may grant or refuse the relief or any part thereof as it deems proper in the circumstances of the case, and in the exercise of this discretion may consider amongst other matters:

(a) the fact that the application is made by the adjacent owner or by the encroaching owner, as the case may be,

(b) the situation and value of the subject land, and the nature and extent of the encroachment,

(c) the character of the encroaching building, and the purposes for which it may be used,

(d) the loss and damage which has been or will be incurred by the adjacent owner,

(e) the loss and damage which would be incurred by the encroaching owner if the encroaching owner were required to remove the encroachment,

(f) the circumstances in which the encroachment was made.

11. In terms of compensation, the Act prescribes the following in s 4:

4 Compensation

(1) The minimum compensation to be paid to the adjacent owner in respect of any conveyance, transfer, lease, or grant to the encroaching owner shall, if the encroaching owner satisfies the Court that the encroachment was not intentional and did not arise from negligence, be the land value of the subject land, and in any other case three times such land value.

(2) In determining whether the compensation shall exceed the minimum, and if so by what amount, the Court shall have regard to:

(a) the value, whether improved or unimproved, of the subject land to the adjacent owner,

(b) the loss and damage which has been or will be incurred by the adjacent owner through the encroachment and through the orders proposed to be made in favour of the encroaching owner,

(c) the circumstances in which the encroachment was made.

12. The Van Beeks submit that the encroachment arose as a result of negligence, namely, that of the owner-builder overseeing the Lous’ 2003/2004 alternation works. It is alleged that the owner-builder owed a duty of care to the then proprietor of the Van Beeks’ land not to erect any buildings upon their land.

13. The breach is alleged to have occurred because cl 24 of the development consent requiring a survey report to be submitted to the principal certifying authority during construction was never finalised.

Procedural History

14. It is necessary to set out some of the procedural history of the matter because it is relevant to the exercise of the Court’s discretion to grant the vacation.

15. No doubt in an effort to minimise costs, the Lous filed a notice of motion on 24 July 2025, seeking that pursuant to s 9(2) of the Encroachment Act the Court “determine the true boundary” between the two properties.

16. Section 9(1) and (2) of the Encroachment Act states:

9 Boundaries

(1) If any question arises as to whether an existing building encroaches or a proposed building will encroach beyond the boundary, either of the owners of the contiguous parcels of land may apply for a determination of the position of the boundary:

(a) to the Registrar-General under Part 14A (Boundary determinations) of the Real Property Act 1900 (but only if the application could be made under that Part apart from this section), or

(b) if the application cannot be made under that Part or the Registrar-General refuses to make that determination—to the Court.

(2) On an application to the Court the Court may make such orders as it may deem proper for determining, marking, and recording the true boundary.

17. The matter came before me in my capacity as List Judge on 15 August 2025, for the purpose of setting the motion down for hearing and to make consequential timetabling orders, including the filing and serving of evidence and written submissions. The Lous are not legally represented and English is their second language.

18. During discussion between the parties and the Court, it was agreed that given that the substantive proceedings were reasonably advanced in terms of their preparation, and in light of the fact that the Court would have to determine the location of the boundary at the final hearing in any event, it would be preferable to hear the notice of motion at the same time as the substantive hearing because the issue of the location of the boundary, and whether there was an encroachment, was likely to occupy the majority of time at the final hearing.

19. There was also an issue as to whether or not the Court had the power to make the boundary determination sought in the motion pursuant to s 9(2) of the Encroachment Act because it was not clear whether an application for a boundary determination could not be made by the Lous themselves under Pt 14A of the Real Property Act 1900, or in the alternative, if the Lous had made such an application, whether the Registrar-General had refused to make the determination (see s 9(1)(b) of the Encroachment Act).

20. Orders were made reflecting the exchange and the matter was set down for final hearing on 6 November 2025:

1. Notice of Motion filed by the Respondents to be heard the same date as the final hearing;

2. The Respondents to file and serve any further evidence by 29 August 2025;

3. The Applicants are to file and serve any evidence in reply by 12 September 2025;

4. The Applicants to file and serve written submissions by 19 September 2025;

5. The Respondents to file and serve written submissions by 26 September 2025;

6. The Applicants to file and serve written submissions in reply by 3 October 2025;

7. The proceedings are set down for 1 day hearing on 6 November 2025 (1 day); and

8. Liberty to restore on 2 days’ notice.

21. The matter came before the Registrar on 19 September 2025, whereupon the Registrar made the following orders:

1. The parties may file brief written submissions (no more than 5 pp) by Friday 26.9.25.

2. Vacate orders 4, 5+6 made 15.8.25.

3. [Liberty to restore on] 2 days’ notice for the parties to seek orders regarding written submissions in the substantive proceedings once the [Notice of Motion] filed on 24.7.25 is determined.

22. These orders vacated the earlier orders made by consent, including the order that the notice of motion be heard and determined at the final hearing.

23. Justice Beasley was allocated to hear the notice of motion and when the application came before him on 29 September 2025, his Honour essentially remade the orders made by the Court on 15 August 2025 (albeit with some timetabling adjustments), including that the notice of motion seeking a boundary determination be heard at the final hearing on 6 November 2025.

24. I have not had the benefit of a copy of the transcript of the directions hearings conducted before myself or Beasley J.

The Directions Hearing on 4 November 2025

25. The Court listed the matter for mention on 4 November 2025 because when it reviewed the file in preparation for the hearing, it was concerned that:

(a) (a) there was no valuation evidence from the Lous; (b) (b) the written submission filed by the Van Beeks were late and were filed after the Lous had filed their submissions; (c) (c) there were competing Court Books; and (d) (d) there were no objections to evidence as ordered.

26. The Lous appeared in person, with Olivia Lou represented (with leave granted pursuant to r 7.7 of the Land and Environment Court Rules 2007 (“LEC Rules”)) by Haiyang Yuan, a family friend with no legal qualifications and for whom English is a second language.

27. It quickly became apparent that the Lous were confused as to what was to occur at the hearing on 6 November 2025. Whether this was due to the series of contradictory orders made by the Court on 15 August and 19 and 29 September 2025, their unrepresented status or their English comprehension, is not clear. They repeatedly stated that they believed that only the boundary determination (that is, the issue of whether there was in fact an encroachment) would be dealt with by the Court on 6 November 2025. It is for this reason that no valuation evidence had been filed and served by them.

28. It was, however, the Van Beeks who made the application to vacate the hearing date. This was, they submitted, in order to:

(a) (a) enable joint reporting of the surveyors to take place; (b) (b) to permit the Lous to file and serve their valuation evidence; (c) (c) to cure the accepted prejudice to the Lous occasioned by the late service of their submissions; (d) (d) to file further surveying evidence because their surveyor was no longer registered and there was an issue with his professional liability insurance; and (e) (e) to permit a delimitation plan to be registered that would, they claimed, have the effect of determining the boundary and dealing with a potential adverse possession claim being made by the Lous.

29. Initially the Lous resisted the vacation application. However, their position changed when it was explained to them that if the hearing went ahead, and an encroachment was found, they had no valuation evidence in response to that served by the Van Beeks. The Lous stated that they wanted the opportunity to file and serve valuation evidence in reply and to respond in writing to the Van Beeks’ submissions.

Legal Principles Applicable to the Vacation of Hearing Dates

30. Section 66(1) of the Civil Procedure Act 2005 (“the CPA”) provides that:

66 Adjournment of proceedings

(1) Subject to rules of court, the court may at any time and from time to time, by order, adjourn to a specified day any proceedings before it or any aspect of any such proceedings.

31. The power to adjourn must be exercised having regard to the overriding purpose of the CPA articulated in s 56(1) and (2) of the CPA:

56 Overriding purpose

(1) The overriding purpose of this Act and of rules of court, in their application to civil proceedings, is to facilitate the just, quick and cheap resolution of the real issues in the proceedings.

(2) The court must seek to give effect to the overriding purpose when it exercises any power given to it by this Act or by rules of court and when it interprets any provision of this Act or of any such rule.

32. In relation to the objects of case management which the Court must consider, s 57 of the CPA states:

57 Objects of case management

(1) For the purpose of furthering the overriding purpose referred to in section 56 (1), proceedings in any court are to be managed having regard to the following objects—

(a) the just determination of the proceedings,

(b) the efficient disposal of the business of the court,

(c) the efficient use of available judicial and administrative resources,

(d) the timely disposal of the proceedings, and all other proceedings in the court, at a cost affordable by the respective parties.

(2) This Act and any rules of court are to be so construed and applied, and the practice and procedure of the courts are to be so regulated, as best to ensure the attainment of the objects referred to in subsection (1).

33. The Court must act in accordance with the dictates of justice in deciding whether to grant an adjournment (s 58(1) of the CPA). Section 58(2) identifies some of the factors that the Court may have regard to in determining where the dictates of justice lie:

58 Court to follow dictates of justice

(2) For the purpose of determining what are the dictates of justice in a particular case, the court—

(a) must have regard to the provisions of sections 56 and 57, and

(b) may have regard to the following matters to the extent to which it considers them relevant—

(i) the degree of difficulty or complexity to which the issues in the proceedings give rise,

(ii) the degree of expedition with which the respective parties have approached the proceedings, including the degree to which they have been timely in their interlocutory activities,

(iii) the degree to which any lack of expedition in approaching the proceedings has arisen from circumstances beyond the control of the respective parties,

(iv) the degree to which the respective parties have fulfilled their duties under section 56 (3),

(v) the use that any party has made, or could have made, of any opportunity that has been available to the party in the course of the proceedings, whether under rules of court, the practice of the court or any direction of a procedural nature given in the proceedings,

(vi) the degree of injustice that would be suffered by the respective parties as a consequence of any order or direction,

(vii) such other matters as the court considers relevant in the circumstances of the case.

34. Finally, the practice and procedure of the Court should be implemented with the object of eliminating delay (s 59 of the CPA) and in such a way “that the cost to the parties is proportionate to the importance and complexity of the subject-matter in dispute”.

35. In Kenoss Pty Ltd v Palerang Council [2013] NSWCA 174 Ward JA stated (at [13]):

13 The power to adjourn proceedings or vacate hearings in s 66 of the Civil Procedure Act 2005 (NSW) confers a discretion that must be exercised in accordance with the overriding purpose described in s 56(1) of the Civil Procedure Act and in accordance with the dictates of justice as described in s 58 of that Act. The considerations that must be taken into account include: the prejudice to the respondent by such an adjournment; the prejudice to the applicant if such an adjournment is refused; the circumstances in which the application is brought; and considerations relating to the administration and management of matters in this Court.

36. Her Honour’s reasoning has been subsequently endorsed and applied by the Court of Appeal in Atanaskovic v Birketu Pty Ltd [2021] NSWCA 11 (at [12] per Gleeson JA) and by this Court in Jiang v Sydney Metro [2023] NSWLEC 126 (at [47] per Pritchard J).

The Hearing is Vacated

37. But for what I accept to be genuine confusion on the part of the Lous which has resulted in the erroneous belief that the hearing would be bifurcated, I would not, having regard to the principles articulated above, have adjourned the hearing. The reasons proffered by the Van Beeks were not in and of themselves sufficiently compelling to warrant an adjournment. No explanation was provided by them for their slippage in complying with the orders made by Beasley J.

38. Furthermore, the Court is increasingly concerned about the inevitable increase in costs consequent upon any delay in the finalisation of the proceedings. Costs that, even at this juncture, are disproportionate to the relief claimed by the Van Beeks. At its highest, the compensation sought by the Van Beeks is approximately $57,600, assuming that they can prove that the encroachment occurred negligently. If no negligence is demonstrated, then in the absence of any valuation evidence filed by the Lous, the compensation will be approximately $19,200.

39. It should be recalled in this context that r 3.7(2) of the LEC Rules (wherein each party pays their own costs unless it is fair and reasonable to order otherwise) does not apply to proceedings under the Encroachment Act and that, therefore, the ordinary rule that costs generally follow the event applies.

40. Having said this, there is real prejudice to the Lous if the hearing is not vacated given their absence of valuation evidence. Unless the valuation evidence of the Van Beeks is not admitted (the Lous foreshadowed an objection to the evidence on the grounds of partiality by reason of a prior professional relationship between Mr Van Beek and the valuer), it is likely to be accepted by the Court.

41. The vacation of the hearing will enable the Lous to file and serve their valuation evidence and to properly digest and respond to the written submissions of the Van Beeks. As a matter of fairness, this ought to be permitted. I note that to date the Lous have largely complied with the orders of the Court and have not engaged in delay.

42. The vacation will have the further benefit of enabling the joint reporting by the surveyors and, if such expert evidence is relied upon by the Lous, the valuers, thereby refining the issues for determination by the Court.

43. In vacating the hearing, I have considered the issue of delay in the finalisation of the proceedings. For this reason, I have relisted the matter for final hearing before me prior to the end of the year and I have made consequential timetabling orders. The matter has been listed for two days as a matter of prudence given the length of time that the mention before me took to conclude and to accommodate any language or other comprehension difficulties, but it is the expectation of the Court that the proceedings ought to conclude in one day.

44. I have also ordered additional mediation in the matter having regard to the disproportionate nature of the quantum of the relief sought and the amount of legal costs already incurred and likely to be incurred into the future.

Orders

45. The orders of the Court are as follows:

(1) the hearing on 6 November 2025 is vacated;

(2) all matters are listed for final hearing before Pepper J at 10am on 17 and 18 December 2025;

(3) the applicants are to file and serve any additional survey evidence by 14 November 2025;

(4) the respondents are to file and serve any additional survey evidence in reply by 28 November 2025;

(5) the surveyors are to file and serve a joint surveying report by 10 December 2025;

(6) the respondents are to file and serve any valuation evidence in reply by 21 November 2025;

(7) the valuers are to file and serve a joint valuation report by 5 December 2025;

(8) the parties are to file a single Court Book, including any objections to evidence, by 12 December 2025;

(9) the parties are to file a joint Tender Bundle by 12 December 2025;

(10) the respondents are to file and serve any submissions in reply by 8 December 2025;

(11) the applicants are to file and serve any submissions in reply by 12 December 2025;

(12) pursuant to s 26 of the Civil Procedure Act 2005 the matter is referred to mediation before a Commissioner of the Court. Such mediation is to take place on or before 10 December 2025. The parties are to confer and approach the Registrar by eCourt for a date for the mediation; and

(13) liberty to restore on two days’ notice (preferably before Pepper J).

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