Hunter Water Corporation v The Owners of Strata Plan 16460 [2026] NSWCA 184
The decision provides guidance on the application of the principles of private nuisance articulated by the High Court in the decision in Hunt Leather Pty Ltd v Transport for NSW, {1} particularly the requirement that a defendant’s use of land be “conveniently done”. It also clarifies the circumstances in which s 43A of the Civil Liability Act 2002 (NSW) applies to the conduct of a statutory authority.
Background
HWC owned and operated a water main located uphill from a strata scheme townhouse complex built on sloping land. The water main had been installed in 1953 and had previously failed in 2010 due to excessive corrosion.
From early August 2017, HWC employees had been investigating a leak in the pipeline. On 21 September 2017, HWC personnel excavated down to the water main and identified what appeared to be a minor, leak from a joint in the pipeline. Due to additional equipment being required to complete repairs, the pipe was left partially exposed overnight, which potentially increased the stress on the pipe by 20%. HWC did not take any steps to reduce the rate of water flow within the pipe, despite knowing that the pressure would increase in the early hours ofthe following morning.
At approximately 3:27am on 22 September 2017 the pipe ruptured, flooding the townhouse complex.
The Owners Corporation of Strata Plan 16460 and the owners of the lots in the townhouse complex (Owners) sought damages from HWC in nuisance and negligence.
At first instance, the Owners succeeded in their claim in nuisance but failed in their claim in negligence. {2} HWC appealed the decision. In doing so, HWC argued, among other things, that any liability in nuisance was subject to section 43A of the Civil Liability Act 2002 (NSW) (CLA). {3} That section provides that a public authority exercising a special statutory power (or failing to) will not incur civil liability unless its conduct was so unreasonable that no authority in its position could properly regard it as a reasonable exercise of that power.
Decision on appeal
Private nuisance: The applicable legal test
The Court of Appeal confirmed that a claim in private nuisance requires three stages to be considered:
- first, whether the plaintiff can establish a substantial interference with its ordinary use of land;
- second, whether the defendant can establish that it was using land for a common and ordinary purpose; and
- third, whether the defendant can establish that it was using means that involved it being ‘conveniently done’, meaning that it adopted means which reasonably minimised the extent of the interference.
HWC conceded that the Owners had established a substantial interference for the purpose of stage one. If HWC established the second and third stages, however, it would not be liable in private nuisance.
The Court held that HWC’s use of the land to maintain and repair water mains was a common and ordinary purpose. The appeal therefore turned on whether HWC had discharged its onus of establishing that its use was 'conveniently done'. The Court held that it had not.
HWC contended that its use of the land was ‘conveniently done’ because the pipe burst as a result of a latent manufacturing defect that it did not know about and could not have been expected to know about, rather than any act or omission on its part. However, the Court held that the evidence did not establish the existence of a latent defect.
Importantly, the Court held that even if a latent defect had existed, that would not have absolved HWC of liability because multiple causes contributed to the rupture, including the excavation, the pipe being left exposed overnight, and the overnight increase in water pressure. The Court held that HWC had not discharged its onus to show its use of the land was conveniently done, and specifically that the means of its use created a real and not remote risk of catastrophic interference with Owners’ land. HWC was also held to have failed to show a good reason for adopting the means it used, or in other words, for doing the work it did in the way it did it.
The Court found that HWC had failed to reasonably minimise the risk of interference, and therefore failed to establish that its use of land was ‘conveniently done’.
The Owners’ nuisance claim therefore succeeded.
Section 43A Civil Liability Act
In relation to HWC's claim regarding s 43A of the CLA, the Court held that in order to engage s 43A, HWC must establish that its civil liability in tort is based upon its exercise of, or failure to exercise, a special statutory power. Although statutory powers authorised HWC to excavate the land, the nuisance claim was based on the physical conduct giving rise to the interference rather than the statutory source of authority permitting excavation. Accordingly, the Court concluded that s 43A had no application to the nuisance claim. {4}
Implications
This decision is important for several reasons:
- It demonstrates that a defendant may fail the ‘conveniently done’ requirement where known risks of catastrophic damage are not reasonably minimised, even if the precise mechanism of failure cannot be identified.
- For utilities and their insurers, the decision underscores the importance of risk management decisions during maintenance works, particularly where known vulnerabilities, prior failures, and available mitigation measures exist.
- The decision also provides useful guidance on the limits of section 43A of the CLA, indicating that a statutory authority will not obtain protection merely because the conduct occurred within a broader statutory framework. The claim must genuinely be based on the exercise, or failure to exercise, a special statutory power.
Footnotes
1. [2025] HCA 53.
2. The s 22 of the Hunter Water Act 1991 (HWA) claim, which was made in the alternative by the Owners, also failed.
3. The Owners cross-appealed with respect to findings as to their claims in negligence and under s 22 of the HWA.
4. In light of the Court’s conclusion that HWC was liable in private nuisance, the Court considered it unnecessary to determine the cross-appeal and it was dismissed.
