Written by In the case of Easter Investment Group Pty Ltd and Anor v E & S Projects Pty Ltd Trading as the Cemento Group & Ors [2023] NSWDC 64, the District Court of New South Wales considered whether damage to the plaintiff’s property was causally linked to the demolition and construction works on adjoining property, and if so, whether the plaintiff was entitled to relief.
The defendant proposed to demolish their house and rebuild. The registered proprietors of the adjoining property claimed this would cause damage to their property and builders would require access to their property. To provide for this access and deal with any damage, the parties entered into a deed, which entitled the plaintiffs to be indemnified for damage to property or any unreasonable disturbance and inconvenience. A sum of $9,542 unpaid invoices accumulated, so the plaintiff commenced proceedings and sought damages for rectification of damage to their property, which was a result of over excavation. The main defects included cracking to the garage door concrete slab, damage to pipework causing water leakage into the garage and flaking of paint.
The issue before the Court was to determine whether the damage was causally linked to the demolition. The Court rejected the defendant’s expert evidence from a structural engineer that claimed the slab cracking and water leakage was a result of blockage of storm water and were not caused by the demolition works. Given the two buildings have existed in close proximity and provided support to each over for over 100 years, the Court held that in the circumstances, it seems objectively likely that demolition and excavation of one building can explain the damage, of the kind in question, to the adjoining property. As such, the Court held the defendants were liable for the loss occasioned by the damage to the plaintiff’s property.
This decision demonstrates the implications of performing construction works on adjoining properties.