Easton Agriculture Ltd v Manawatu-Wanganui Regional Council

JurisdictionNew Zealand
JudgeThe Hon Justice KÓS
Judgment Date07 September 2011
Neutral Citation[2011] NZHC 1005
Docket NumberCIV-2008-454-31
CourtHigh Court
Date07 September 2011
Between
Easton Agriculture Limited
First Plaintiff

And

and
Eveleigh Farming Company Limited (In Receivership)
Second Plaintiff

And

Manawatu-Wanganui Regional Council
Defendant

[2011] NZHC 1005

Kos J

CIV-2008-454-31

IN THE HIGH COURT OF NEW ZEALAND PALMERSTON NORTH REGISTRY

Catchline: Costs decision relating to unsuccessful negligence claim taken by plaintiffs—proceedings related to a floodway stopbank which failed and resulted in flooding of plaintiffs croplands—High Court found respondent owed a duty of care to monitor and maintain floodway stopbanks which it had breached, but that failure of stopbank was caused by independent factors for which defendant not liable — whether defendant entitled to increased costs under r14.6 High Court Rules (increased costs) because plaintiffs failed to accept a pre-trial walk-away offer — whether costs payable by plaintiffs should be reduced under r14.7(d) (party had succeed overall but failed in relation to an issue) — what proportion of the defendant's witness fees should be paid by the plaintiffs — whether receiver of second plaintiff should be personally liable for costs.

Counsel:

J O Upton QC with M S Dobson for Plaintiffs D J Heaney SC with S H Macky for Defendant

JUDGMENT OF The Hon Justice KÓS

The Hon Justice KÓS

Introduction

[1]

Background

[5]

The February 2004 flood

[36]

Parties

[67]

Pleadings

[76]

Issues

[93]

Issue 1: Can the Council be liable other than in negligence?

[94]

Issue 2: Did the Council owe the plaintiffs a duty of care in its monitoring and maintenance of the stopbank?

[122]

Issue 3: Was the Council negligent?

[143]

Issue 4: Did the Council's negligence cause the plaintiffs’ loss?

[195]

Conclusion

[224]

Disposition

[225]

Introduction
1

A floodway stopbank fails. The floodway diverts part of a river's flow during flood conditions. Together the floodway and river can cope with a 1 in 100 year flood. But the flood that leads to the stopbank failure is greater still. A 1 in 110 year flood. The floodway is crossed by a highway bridge. The bridge cuts through the top of the stopbank on the southern side of the floodway. During the flood the water reaches and laps the bottom of the bridge. Yet the flood should still be able to be contained within the floodway stopbanks.

2

But the southern stopbank fails. First, just upstream of the bridge. Then, a few hours later, downstream of the bridge. Ultimately a gap of 40 metres opens up about the bridge. The exact cause of the failure is in dispute. Nearby croplands belonging to the plaintiffs are flooded. The stopbank is the responsibility of a regional council. Must the council compensate the plaintiffs for the loss of their crops?

3

The main questions in this case are whether the Council was negligent in its monitoring and maintenance of the stopbank, and whether any such negligence caused the plaintiffs’ loss. The plaintiffs expressly do not claim the construction of the bank or bridge was negligent.1 Any such claims would long since have been time barred.

4

Evidence as to quantum was received by the Court. By agreement the issue of quantum was reserved for further argument, if need be. This judgment is confined to whether the Council is liable to the plaintiffs.

Background
Manawatu River
5

The Manawatu River is about 160 kilometres long. It rises on the eastern side of the Ruahine Ranges. Fifty kilometres later it passes through the Manawatu

Gorge, and then flows on past the city of Palmerston North. From there to the small settlement of Opiki, the river is steep enough to transport gravel when the river is in flood, and the riverbed is gravelled. Downstream of Opiki the gradient is flat. The riverbed is silty. Flood velocities here are typically about 1.5 metres per second, compared to 3 to 4 metres per second in the steeper Palmerston North section
6

River level and flow records have been held longer for the Manawatu than any other river in New Zealand. An automatic recorder has been operating at Palmerston North since 1929. Manual information is available back to the 19th century. The February 2004 flood, with which we are concerned, was the third largest flow recorded on the river:

Year

Discharge (cumecs) 2

1880

4000

1982

3800

2004

3500

7

At Opiki, where the river gradient flattens out, the Oroua River joins the Manawatu. The Oroua is the Manawatu's major tributary. Below the confluence with the Orua, at Opiki, the Manawatu wends its way on towards the sea past flat lands called the Makerua and Moutoa basins. The plaintiffs farm in the Moutoa basin.

8

Substantial swamp drainage works were undertaken in these areas in the 19th century. Flax was planted in the newly drained land. The flax fibre was used to make rope for sailing vessels and lashings for wool bales. Much of it was exported to Australia. Maori had exploited this resource for generations by the time pakeha settlers established ropewalks along the Manawatu river banks in the 1840s. 3 When the flax industry declined in the late 19th century the land was drained and converted to farming. First Makerua, and later Moutoa, the area with which we are concerned in this case.

Horowhenua County & Its People (Dunmore Press, Palmerston North, 1984) 141–145.

9

The first flood protection works were constructed between 1923 and 1925. The Makerua Drainage Board constructed stopbanks to protect the Makerua basin. In the 1930s and 1940s more stopbanks were built, by the Manawatu-Oroua River Board and the Palmerston North River Board.

Lower Manawatu Flood Control Scheme
10

The Lower Manawatu Flood Control Scheme (LMS) was undertaken by the Manawatu Catchment Board between 1959 and 1965. The LMS protects 320 square kilometres of land from flooding. But for these flood protection works, the city of Palmerston North, the town of Fielding, and significant areas of the region, in particular the Taonui, Makerua and Moutoa basins, would be prone to flooding in severe weather events.

11

The LMS relies primarily on stopbanks to contain floodwaters. A key part of the scheme, as we shall see, is the Moutoa floodway. The LMS is designed to contain a “1 in 100 year flood”, meaning that such a flood is expected (measured over a very long period of time) to recur on average once every 100 years. To put it another way, there is a 1 per cent statistical probability of that flood size being equalled or exceeded in any given year. The LMS stopbanks were built with a design objective of a freeboard of 450 millimetres. That is, at all points the stopbank crests were to be 450 millimetres higher than the calculated 1 in 100 year flood level.

12

At the time of the February 2004 flood, the 1 in 100 year flood flow was set at 3,450 cumecs (measured at Palmerston North). At 3,500 cumecs, the February 2004 flow exceeded that level slightly. It is common ground that it was a “1 in 110 year” flood.

Moutoa floodway
13

Downstream of the settlement of Opiki, and the confluence of the Manawatu and Oroua Rivers, there is a long oxbow bend where the Manawatu doubles back on itself. On the apex of that bend vast sluice gates have been built. These are the Moutoa sluice gates. The sluice gates were built in the early 1960s. They are

regarded as a major engineering feat. When open, they allow the river flow to be split. The major part of the water is sent down the Moutoa floodway. The existing river channel will take the rest. The sluice gates serve as a critical safety valve. The change in gradient at Opiki means the river flow is far slower here than higher up the river. But for the ability to open the sluice gates, and divert part of the river down the floodway, floodwaters would bank up and overwhelm the stopbanks.

14

The floodway passes directly across low-lying farmland in the Moutoa basin. It runs from the oxbow bend to a point near the Manawatu river mouth. It is 10 kilometres long, and bypasses 30 kilometres of winding river channel. The floodway averages 600 metres in width. Its presence means that in all but floods exceeding the 1 in 100 year level, the Manawatu River water can be contained wholly within the existing river structure and the Moutoa floodway. The part of the Moutoa basin lying between the floodway and river channel should remain free from flood. It is that land the plaintiffs farm.

15

The flood levels in February 2004, a 1 in 110 year flood, were always going to challenge the floodway and river's capacity to cope.

Trestle bridge
16

Running at right angles to the floodway is State Highway 1. Just south of Foxton it crosses the floodway using a trestle bridge. The trestle bridge was built in the 1930s. The floodway, in the 1960s. The trestle bridge is lower than the adjacent floodway stopbanks. So, in effect, it cuts through them. Either side of the bridge, the stopbank crest runs up against the outer fascia of the bridge, at about road level. Beneath the bridge long beams run with the road, supporting the bridge deck. They project down from the bridge deck. The stopbank builders built the crest as far up beneath the bridge as they could. Then they filled in the spaces above the stopbank and between the beams with bags filled with cement and gravel. These harden to concrete. It is as if the spaces are filled with large flat rocks.

17

Applying and enlarging the advertising adage that a picture is worth a thousand words, I reproduce three images adduced in evidence, which depict the situation:

Fig 1: bridge substructure, downstream of bridge, looking north towards Foxton.

18

Figure 1 shows that the side of the bridge comprises (1) a fascia (with safety parapet above) and (2) a series of longitudinal beams beneath (and inset from) the fascia. The beams project 480 millimetres below the fascia. This is the appropriate point to repeat some statistics that emerged in evidence:

  • (a)...

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