Bilic & Bilic v Nicholls & Ors [2013] QDC 110

DISTRICT COURT OF QUEENSLAND CITATION: Bilic & Bilic v Nicholls & Ors [2013] QDC 110 PARTIES: DRAGAN BILIC And VESNA BILIC (plaintiffs) V ANDREW NICHOLLS (first defendant) And SHARYN LEE NICHOLLS (second defendant) And JIMI LEE (third defendant) FILE NO/S: 22/2011 DIVISION: Civil PROCEEDING: Trial ORIGINATING COURT: District Court, Beenleigh DELIVERED ON: 17 May 2013 DELIVERED AT: Beenleigh HEARING DATE: 25 February 2013 JUDGE: Dearden DJC ORDER: 1. I give judgment for the plaintiffs Dragan and Vesna Bilic against the first defendant, Andrew Nicholls, the second defendant, Sharyn Nicholls, and the third defendant Jimi Lee, as follows: (a) Restitutionary compensatory damages $73,000 (b) Aggravated compensatory damages $30,000 (c) Interest at 10% per annum from 16 March, 2011 to 17 May, 2013 -$103,000 x 10% x 2.17 years = $22,351 (d) Exemplary damages - $30,000 (e) Total - $155,573 -- 1 of 14 -- 2 2. I order that the first, second and third defendants pay the plaintiffs’ costs on a standard basis. CATCHWORDS: CIVIL TRIAL – DAMAGES – ex parte – dispute with neighbours - trespass – damage to property – nuisance – damages – exemplary damages LEGISLATION: Uniform Civil Procedure Rules (UCPR) rr.166(4),(5) CASES: Ansett Transport Industries (Operations) Pty Ltd v Australian Federation of Air Pilots (No.2) [1991] 2 VR 636 British Motor Trade Assoc’n v Salvadori[1949] Ch 556 City Bank of Sydney v McLaughlin (1909) 9 CLR 615 Klement v Pencoal Ltd [1999] QSC 90 Halliday v Nevill (1984) 155 CLR 1 McCarty v North Sydney Municipal Council (1918) 18 SR NSW 210 Woolley v Dunford (1972) 3 SASR 243 Plenty v Dillon (1991) 171 CLR 635 Pollack v Volpato [1973] 1 NSWLR 653 Quinn v Anthem [1901] AC 495 Stereff v Rycen & Anor [2010] QDC 117 TCN Channel 9 Pty Ltd v Anning [2002] 54 NSWLR 333 XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd (1985)155 CLR 448 COUNSEL: MJ Byrne for the plaintiffs. No appearance for the first, second or third defendants. SOLICITORS: Pearson and Associates for the plaintiffs. No appearance for the first, second or third defendants. -- 2 of 14 -- 3 Introduction [2] The plaintiffs seek damages for trespass, nuisance and interference with contractual relations or business, as well as exemplary and aggravated damages against the first defendant, Andrew Nicholls, the second defendant Sharyn Lee Nicholls (wife of the first defendant), and the third defendant Jimi Lee. Hearing [3] Although the first, second and third defendants filed pleadings in these proceedings, none of the defendants appeared at the trial on 25 February 2013. The matter proceeded in the absence of the first, second and third defendants, with oral evidence called by and exhibits tendered on behalf of the plaintiffs. Background [4] The plaintiffs were (at the relevant time) the owners of a property at 16 Charlane Street, Underwood, which was then an investment property, and was rented by them until the tenant vacated the premises on 4 February 2010. [5] The plaintiffs came into dispute with their neighbours, the first and second defendants, in respect of the demolition of a small block dividing wall between the plaintiffs’ property, and the property at 18 Charlane Street, Underwood occupied by the first and second defendants. Pursuant to a contract of sale between the third defendant, Jimi Lee and the first and second defendants, dated 18 August 2005, the first and second defendants were “licensed to use and occupy the property from the -- 3 of 14 -- 4 possession date until settlement”, which required the first and second defendants to make 300 payments over a period of 25 years at $2383.33 per payment, on completion of which condition, the property at 18 Charlane Street, Underwood would be transferred into the names of the first and second defendants.1 [6] Until the final payment was received, the first and second defendants were “licensed to use and occupy the property from the possession date until settlement”2; were permitted to carry out improvements on the property not requiring council permits; and were permitted to construct retaining walls to the western and southern boundaries of the property as well as constructing new boundary fences.3 The first and second defendants were not permitted to make any alterations, structural or otherwise which affected the visual integrity of the improvements on the property without prior written consent of the third defendant, and were not permitted to demolish or change any part of the improvements on the property without the prior written consent of the third defendant4. [7] The third defendant was the registered owner of the property at 18 Charlane Street, Underwood, and the sale contract5 effectively licensed the first and second defendants to occupy that property pursuant to, effectively, a “hire purchase” agreement between the third defendant and the first and second defendants.6 1 Exhibits 2 and 3. 2 Exhibit 3 clause 1.14(5). 3 Exhibit 3 clause 22. 4 Exhibit 3, special condition 1.5 (clause 11.1) (c) and (d). 5 Exhibit 2. 6 Exhibit 2. -- 4 of 14 -- 5 Summary of the plaintiff’s case [8] The plaintiffs assert that the first and second defendants embarked on a course of conduct in an attempt to force the plaintiffs into demolishing the block wall situated on the boundary between 16 and 18 Charlane Street, Underwood, and then sought to have a retaining wall constructed on the boundary line at the plaintiffs’ expense. [9] During the course of conduct which occurred between the first and second defendants and the plaintiffs, behaviour by the first and second defendants is asserted by the plaintiffs to have included trespass, violence, threats of death, assault, wilful destruction of the plaintiffs property, repeated unfounded complaints to both the Queensland Police Service and the Logan City Council, and harassment of the plaintiff’s real estate agent, prospective purchasers of the plaintiffs property and the tenant who was resident at 16 Charlane Street, Underwood when the course of conduct commenced. Agency [10] The plaintiffs plead in their statement of claim7 that the first and second defendants acted both in their own right, and jointly or severally as agents of the third defendant. It is further pleaded that the second defendant acted through her agent, the first defendant. [11] Paragraph 2 of the Amended Statement of Claim8 states: “2. The first and second defendants or each of them: 7 Paragraphs 5, 6, and 8. 8 Filed 14 June 2011. -- 5 of 14 -- 6 a. Were the occupiers of property situate at 18 Charlane Street, Underwood in the district of this Honourable Court and more properly described as Lot 24 on RP 126545, County of Stanley, Parish of Yeerongpilly (“the defendants properties’”); b. Live in the defendants property; c. Lived next door to the plaintiffs property; and d. Acted in their own right and as the agents of the third defendant. 3. The second defendant; a. Was the wife of the first defendant; b. Knew or ought to have known of the actions of the first defendant as pleaded hereafter; c. Condoned or supported the first defendant in his actions as pleaded hereafter; and d. Acted in her own right and through her agent the first defendant.” [12] The allegations contained in paragraph 2 and 3 of the Amended Statement of Claim are deemed to be admitted by the first and second defendants.9 There was, of course, no evidence called by or on behalf of the first and second defendants to contradict the evidence of the plaintiffs and their witnesses. [13] The third defendant in his Defence10 denies that the first and second defendants were his agents and denied that he was aware of their actions until after they had occurred. [14] Exhibit 20 is an email trail between the plaintiffs’ solicitors and one Kim Willis, appointed by the third defendant to seek a resolution to the dispute between the first and second defendants, and the plaintiffs. [15] Senior Associate Jeremy Stretten, from the plaintiffs’ then solicitors, Rostron Carlyle, wrote on 27 September 2010 (relevantly): “In relation to the specific points raised, we are instructed as follows: 9 Uniform Civil Procedure Rules (UCPR) R.166(4) & (5). 10 Paragraphs 3, 4 and 5. -- 6 of 14 -- 7  That the Nicholls continue to reduce the market value of our clients property;  As far as our client is concerned there is no dispute over the boundary;  Neither our office nor our client is aware any legal proceedings;  That our client has complied with council regulations and that no further work is required; and  That our client requests that you have Mr and Mrs Nicholls remove the soil and concrete illegally dumped on our client’s property at his own expense. These actions have damaged the recent landscaping our client has under taken; Please urgently advise what steps have been taken on behalf of the owner of the property.”11 [16] Mr Willis then replied: “Each of these points contradicts what the Nicholls are telling us. They have supplied a large amount of info to verify and bolster their case. At this point I have to support their stance. Kim Willis”12 [17] It is submitted on behalf of the plaintiffs, and I accept, that the third defendant permitted the first and second defendants to act as his agents, and that the third defendant (through his agent Kim Willis) subsequently ratified the behaviour of the first and second defendants. In addition, as owner of the property at 18 Charlane Street, Underwood at the relevant time, the third defendant stood to gain a benefit of an improvement to his property from the plaintiffs constructing a new fence or retaining wall.13 Conversely, the third defendant took no steps to indicate that he should not be regarded as the principal in respect of the acts of the first and second defendants.14 11 Exhibit 23 p.2. 12 Exhibit 23 p.2. 13 Klement v Pencoal Ltd [1999] QCS 90, Para 53. 14 City Bank of Sydney v McLaughlin (1909) 9 CLR 615, 625-6, 629, 633. -- 7 of 14 -- 8 Trespass [18] An unjustified entry of a person on land in the possession of another, carried out either intentionally or negligently, is an actionable trespass even if no damage is caused.15 The plaintiff in an action of trespass to the land is the person who was or is deemed to have been in possession at the time of the trespass. This includes the landlord owner of a relevant property with a reversionary interest.16 [19] The evidence of the plaintiff, Dragan Bilic, was that the first defendant utilised a digger and excavated into the plaintiffs property between 1 and 2 metres, and then dumped that dirt in front of the first and second defendants’ property.17 Subsequently the dirt was dumped onto the plaintiffs’ property around 17 September 201018, and in addition, mud was thrown at the plaintiffs’ house and yard at 16 Charlane Street on 15 September 2010 by the first defendant.19 [20] I am satisfied that the plaintiffs are entitled to sue in trespass. Nuisance [21] To establish a cause of action in nuisance the plaintiffs must demonstrate: - (1) that they have titled to sue in respect of the particular nuisance; (2) that the defendant(s) have interfered with the property right of the 15 Halliday v Nevill (1984) 155 CLR 1, 10; Plenty v Dillon (1991) 171 CLR 635, 639, 647. 16 TCN Channel 9 Pty Ltd v Anning [2002] 54 NSWLR 333, 340; Stereff v Rycen & Anor [2010] QDC 117 Paras 129-130. 17 Transcript T.1-26. 18 Transcript T.1-27. 19 Transcript T.1-28. -- 8 of 14 -- 9 plaintiff(s); and (3) the interference was both substantial and unreasonable. [22] As landlords with a reversionary interest in the land, although not residing there at the relevant time, the plaintiffs are entitled to sue, given that the nuisance, I conclude, caused permanent injury to the land.20 That nuisance committed by the first and second defendants would have been of a permanent character, unless something had been done to remove it.21 [23] The tenant who had been residing in the property belonging to the plaintiffs left on or about 4 February 201022, and at least from that date, the plaintiffs were in possession or entitled to possession, and therefore entitled to sue. In any event, the first and second defendants, in their pleadings, expressly admitted the plaintiffs “at all times material to this action, were the owners in possession or entitled to possession of 16 Charlane Street, Underwood”23. [24] It is submitted (and I accept) that there were further acts by the first and/or second defendants which also constituted a nuisance, namely: (a) Continual surveillance from the first and second defendants property; (b) The second defendant filming the plaintiffs when they attended the plaintiffs’ home at Sunnybank Hills to deliver a letter, during which process the first defendant threatened to kill the plaintiffs; 20 McCarty v North Sydney Municipal Council (1918) 18 SR NSW 210. 21 McCarty v North Sydney Municipal Council (1918) 18 SR NSW 210. 22 Transcript p.1-10. 23 Defence of the first and second defendants, Para 1. -- 9 of 14 -- 10 (c) Threats by the first defendant to the plaintiffs outside the 16 Charlane Street, Underwood property, with racial vilification of the plaintiffs, and sexual orientation vilification of the plaintiffs’ son; (d) Thirty or forty unwarranted complaints made by the first and second defendants to the Logan City Council about the plaintiffs property (including a complaint about the soil and pieces of concrete which were, in fact, dumped on the plaintiffs’ property by the first defendant, causing a direction to be given by the Logan City Council to the plaintiffs to remedy a “nuisance”).24 [25] I accept that the plaintiffs have title to sue the first and second defendants; that there was interference with the property rights of the plaintiffs; and that the interference was both substantial and malicious. Interference with contractual relations [26] The tort of interference with contractual relations is committed when a person knowingly and intentionally interferes with contractual relations or the contractual rights of a person without sufficient justification for that interference.25 It is necessary to prove that there was a contract; that it had been interfered with by the defendant; and that the defendant had sufficient knowledge of the contract to know that he or she was hindering or preventing the performance of the contract.26 The interference must be unlawful and may be effected directly or indirectly.27 Damages are recoverable for economic loss, which may reflect the pecuniary loss, 24 Exhibit 19. 25 Quinn v Anthem [1901] AC 495, 510. 26 Woolley v Dunford (1972) 3 SASR 243, 270. 27 Woolley v Dunford (1972) 3 SASR 243, 267. -- 10 of 14 -- 11 but is not necessarily confined to such loss.28 Aggravated and exemplary damages may also be available, as are expenses incurred in mitigating the effects of the tort29. [27] The evidence indicates that the plaintiffs were the landlords of the property at 16 Charlane Street, Underwood from which they received income arising from a contract with their tenant, which contract was terminated by the tenant as a direct result of the actions and behaviour of the first and second defendants30. The plaintiffs then had a contract with their real estate agent to let the property (and when that was unsuccessful, subsequently to sell the property) and the first and second defendants, for a period of 10 months, prevented or interfered with the letting and/or sale of the property.31 Damages [28] The plaintiff Dragan Bilic gave evidence that the property at 16 Charlane Street, Underwood had been rented to a tenant for a period of some two years at $380 per week, but as a result of the harassment by the first and second defendants, that tenant terminated the lease on 4 February 2010 and the plaintiffs were unable to secure a new tenant as a result of the harassment. Interference by the first and second defendants, including displaying a sign on the telephone post on the footpath between the two properties32. 28 Woolley v Dunford (1972) 3 SASR 243, 267. 29 Ansett Transport Industries (Operations) Pty Ltd v Australian Federation of Air Pilots (No.2) [1991] 2 VR 636, 646; British Motor Trade Assoc’n v Salvadori [1949] Ch556, 569. 30 Transcript p.1-10. 31 Exhibits 5 and 22. 32 Transcript p.1-10. -- 11 of 14 -- 12 [29] The plaintiffs claim loss of 42 weeks of rental from 5 February to 24 November 2010 at $380 per week ($15,960)33. [30] As at 17 March 2010, Hartley Property Valuations valued the plaintiffs’ property at 16 Charlane Street, Underwood at $422,000.00, and subsequently at $408,000.00 as at 25 October 2010.34 The drop reflected a drop in market value. The house subsequently sold for $335,000.0035. [31] The relevant loss directly attributable to the actions of the first and second defendants (rather than market forces) is the sum of $73,000. Aggravated damages/exemplary damages [32] I refer to and adopt the exposition of his Honour Judge Irwin in respect of the principles of aggravated compensatory damages and exemplary damages as set out at paragraphs 159-165 of Stereff v Rycen & Anor [2010] QDC 117. [33] The plaintiffs Dragan and Vesna Bilic each testified that the conduct of the first and second defendants caused significant stress, that they became depressed and anxious and that they felt humiliated and threatened. This evidence was supported by the evidence of the plaintiffs’ son, Nicola Bilic36. Further support for the plaintiffs’ evidence as to the effect of the behaviour of the first and second defendants (which I consider to be unlawful) was the evidence of Safet Milicevic, who himself was the 33 Transcript pp.1-9 – 1-10. 34 Exhibits 12 and 13. 35 Exhibit 23. 36 Transcript p.1-41. -- 12 of 14 -- 13 subject of intimidatory, humiliating and disgraceful conduct at the hands of the first and second defendants37. [34] I adopt the comments of his Honour Judge Irwin in Stereff v Rycen & Anor [2010] QDC 117 at paragraph 211, and note that his Honour in that case awarded the sum of $15,000 to the plaintiff for significantly less serious conduct. [35] In my view, a sum of $30,000 adequately reflects the justified aggravated compensatory damages which should be awarded in this case as a result of the conduct of the first and second defendants. Exemplary damages [36] The purpose of exemplary damages is “to punish the defendant for conduct showing a conscious and contumelious disregard for the plaintiffs’ rights and to deter him from committing like conduct again.”38 [37] I accept the submission that in this case, exemplary damages should be quantified separately from aggravated compensatory damages and such damages should be assessed in a similar way to the principles of awarding a fine.39 [38] Other than that the first and second defendants are purchasing the house at 18 Charlane Street, Underwood from the third defendant at $2,383.33 per month, and that the first defendant is apparently a “pool contractor”40, I have no other 37 Transcript pp.1-33 – 1-34 & Exhibit 22. 38 XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd (1985)155 CLR 448, 471 (Per Brennan J) 39 Stereff v Rycen & Anor [2010] QDC 117, Para 163; Pollack v Volpato [1973] 1 NSWLR 653, 655 40 Exhibit 8. -- 13 of 14 -- 14 information on which to calculate an appropriate quantum which would be “intended to punish the defendant(s)” for their conduct. [39] In the circumstances, I consider that exemplary damages fixed at the same level as the aggravated compensatory damages (i.e. $30,000) best reflects the courts’ approbation of the appalling conduct of the first and second defendants. Agency [40] I consider that the third defendant, Jimi Lee is liable as principal for the acts of the first and second defendants as his agents. [41] Accordingly, I order as follows: 1. I give judgment for the plaintiffs Dragan and Vesna Bilic against the first defendant, Andrew Nicholls, the second defendant, Sharyn Nicholls, and the third defendant Jimi Lee, as follows: (a) Restitutionary compensatory damages $73,000 (b) Aggravated compensatory damages $30,000 (c) Interest at 10% per annum from 16 March, 2011 to 17 May, 2013 - $103,000 x 10% x 2.17 years = $22,351 (d) Exemplary damages - $30,000 (e) Total - $155,573 2. I order that the first, second and third defendants pay the plaintiffs’ costs on a standard basis. -- 14 of 14 --