Nottingham Forest Trustee Ltd v Unison Networks Ltd [2021] NZCA 227
Background
In 1960s, a powerline known as the Esk Feeder was installed from Tamatea Substation in Napier to Tutira Substation in Hawkes Bay. The land was initially a beef and sheep farm but in the 1990s, it became a pine forest. The initial planting created a 20m corridor on both sides of the Line.
But over time the trees became taller than the distance to the Line.
Problem
In 2010, a series of trees started falling on the Line. There was an incident in December 2010, then two more in July 2011 and in September 2013. Every time, the customers serviced by the Line were affected. Unison, the Line owner, was concerned. It entered discussions with the owner of the forest, Nottingham Forest Trustees (NFT), to put them on notice of the issues and ask that they remove the trees closer to the Line.
NFT thought that it had no obligation under the regulations, and that the trees were falling due to bad weather over which it had no control.
NFT was open to remove the trees if it received compensation. It appears some 500 trees were involved. The cost to create a corridor of 40m was estimated at $65,000 which included the loss in land and crop value. Between 2015 and 2018, there were four other incidents of trees falling on the line, some with significant consequences for the customers (after one such incident, it took six days to restore power).
Unison incurred around $230,000 in repair costs to the powerlines.
Legal proceedings
Against this background, Unison started proceedings against NFT and its associated companies seeking an injunction against NFT requiring them to clear the corridor of possible falling trees. It also sought compensation for the repair costs it incurred.
The claim was pleaded in nuisance and under Rylands v Fletcher, and alternatively in negligence.
Does ownership of powerlines infrastructure give Unison an interest in the land?
One of the major legal issues was whether Unison had an interest in land that would give it the right to sue in nuisance or under Rylands v Fletcher.
Nuisance is a tort that affects someone’s enjoyment of rights over their land. The High Court decided that the statutory rights, once exercised, gave Unison an interest in the land; that as the owner of the powerlines and of the infrastructure, Unison had exclusive possession of the soil below the powerlines, and this possession meant that the rights of the owner of the surrounding land were ousted as long as the infrastructure remained in place, and that these rights were greater than an easement or a licence. In any event, the High Court said that even if no interest in land was said to exist, the existence and importance of the infrastructure was such that, for reasons of public policy, Unison had sufficient interest in the land to enable it to claim in nuisance or under Rylands v Fletcher.
What was required to establish liability in nuisance?
Unison argued that all it had to show was that it had an interest in the land, and that NFT’s actions interfered with the enjoyment and use of its land. Interference was easy to prove because there were numerous incidents of trees falling.
In its defence, NFT argued that Unison had to prove a causative fault, not just interference.
The Court said that while usually liability for individual tree falls will require some causative fault on the part of the defendant, “context is everything”. Here, Unison was providing a service that was of significant public importance; it had no way to protect its powerlines, no right to trim or cut trees; NFT deliberately planted a forest around the powerlines which it knew would grow beyond the length of the corridor; and this was not simply a case of an individual tree falling, it was an accumulation of trees planted along the corridor which were at risk of falling. In addition, NFT had no way of determining which trees were at risk of falling because the problem was not that the trees were unhealthy but that the soil was at risk of losing cohesion after a weather event and thus cause root plate failure.
The High Court found that NFT had a strict liability in relation to the interference caused by its trees. The High Court also found NFT liable under Rylands v Fletcher but not in negligence.
The appeal
NFT appealed the decision and argued that the High Court judge was wrong to impose strict liability.
The Court of Appeal disagreed and upheld the High Court’s decision that NFT’s liability in nuisance was strict. However, it took a different approach in relation to the Rylands v Fletcher and argued that NFT was not liable under Rylands v Fletcher.
In relation to the nuisance argument, the Court of Appeal drew a distinction between cases related to liability for trees falling where there was a one-off incident, and the current case where there have been recurring incidents of trees falling on Unison’s lines.
The Court of Appeal found that a party responsible for creating a state of affairs that unreasonably interferes with a neighbouring property will be strictly liable for the consequences.
That party cannot defend itself by arguing that it took all reasonable precautions to prevent the activity from causing an unreasonable interference. As to what constituted unreasonable interference, the Court said that ongoing and substantial physical damage to another’s land, meant that the interference was unreasonable. NFT could not defend itself by arguing that it complied with the Electricity (Hazards from Trees) Regulations 2003.
Compliance with the regulations did not equate reasonableness.
As to the cause of action under Rylands v Fletcher, the Court of Appeal said that the current case did not meet the strict criteria required for a case under the Rylands v Fletcher. Planting a forest on rural land was a natural use of land. Trees in themselves were not dangerous when planted. This was not a situation where there was a special use of land bringing with it increased danger to others. Interestingly, the Court did not take an issue with the possibility of trees “escaping” from the land.
In conclusion, NFT was liable in nuisance and had to pay Unison the repair costs.
The Court noted that before the appeal was heard, NFT removed all trees around the corridor.
This case is a useful summary of the law relating to liability for falling trees. It also brings an important clarification on the network operators’ interest in land.
In addition, it is a useful lesson to lawyers on how to plead the case where the claim could be argued in nuisance, under the Rylands v Fletcher rule, and in negligence.
