A claim for nuisance with respect to railway culverts which allegedly resulted in a concentrated flow of water onto the plaintiff's property.

In Issue

  • Whether culverts resulted in water being directed to the grazing property of the plaintiff;
  • Whether this caused erosion and subsidence of a gully on the plaintiff’s property;
  • How to assess any diminution in the value of the grazing property; and
  • The apportionment of liability as between the first and second defendants

The Background

The plaintiff purchased its property in 1995 for the primary purpose of cattle grazing. By about 1999 Mr Baker of the plaintiff observed that a gully on the property had eroded significantly, such that he was unable to utilise the area for cattle grazing as he was reluctant to utilise a vehicle in the vicinity of the gully, fearing further erosion and potential collapse.

The plaintiff commenced proceedings in 2004 seeking damages in the sum of $250,000. By the time that the proceedings were transferred to the Supreme Court the sum claimed was $1.8M.

The plaintiff alleged that culverts that had been constructed along with the railway (in about 1885) caused a concentrated discharge of water onto the plaintiff’s property, resulting in significant erosion.

The first defendant accepted responsibility for the railway land from 1885 to early 2003 and the second defendant assumed responsibility from 9 April 2003.

At trial, the judge identified 11 issues for determination, the most significant of which was whether the culverts altered the natural watercourse, whether the conduct complained of by the plaintiff was nuisance, whether the plaintiff had failed to mitigate its loss with respect to the erosion and the proper measure of damages.

The Decision

The court noted that the basis for an award in damages is “the loss of the amenity of the use and enjoyment of the land” and that the proper measure of damages was either the cost of reinstatement or the diminution in value of the land.

To determine if there had been nuisance the court considered the extensive expert evidence that had been obtained by the parties regarding the original construction of the railway, the placement of the culverts and the impact of subsequent land clearing and alteration of the natural watercourse.

The court concluded that there was evidence of ongoing erosion which had prevented the use of the property for the grazing of cattle and was accordingly a “substantial or unreasonable interference with the use or enjoyment of the plaintiff’s land”.

The court rejected the first defendant’s submission that it was entitled to rely upon a statutory authority defence as it found that the first defendant should have considered the clearing and development of the land east of the railway corridor and its potential impact upon flows of water at that time, or at the least, when it was provided with notification of the erosion by the plaintiff.

In terms of damages, the plaintiff sought a fluctuating figure for quantum (as high as $4.6M) but ultimately quantified the claim at $1.8M. The sum represented the cost of remediation work the plaintiff asserted was required as a result of the nuisance and was based upon expert evidence obtained by the plaintiff, including from a hydrologist.

The defendants asserted that the reinstatement costs claimed by the plaintiff were excessive and inappropriate, and far exceeded the value of the part of the plaintiff’s land affected by the erosion.

The court noted that there was no expert evidence from the parties as to the impact that the erosion had on the diminution in value of the plaintiff’s land. The parties instead relied upon valuation evidence provided by the Australian Taxation Office and by the local Council in the form of rates notices, which the court said was unhelpful in gauging the market value of the land affected by the erosion. The court found that the plaintiff was entitled to damages for reinstatement, but noted that the reinstatement costs had to be considered in the context of the use of the property as farm land (as distinct from a family home).

In terms of apportionment as between the defendants, the court noted that there was an element of arbitrariness in dividing the costs of the reinstatement and it elected to divide the costs equally between the defendants. It accordingly ordered that each of the defendants pay to the plaintiff $75,000 for damages for nuisance. The court also granted an injunction sought by the plaintiff requiring the second defendant to seal the culverts, although it stayed the order for 6 months to allow the second defendant to design an alternative drainage plan.

The court did not make any reduction for the plaintiff’s failure to mitigate its loss, on the basis that it had not been provided with any practical solutions as to how to go about this by either of the defendants.

Implications for you

In this case, the key issues were determined by expert evidence and ultimately it was found that on a number of issues, the plaintiff’s expert evidence was more satisfactory than that produced by the defendants. As always, it remains critical to ensure that expert evidence is obtained from relevant experts and that experts are directed to respond to the key elements that will be considered by a court. Nuisance is not frequently used in tortious causes of action, but this decision shows that it can still provide owners whose property is adversely affected by the actions of neighbours with a potent remedy.