Background
Jian Min Xu owned a residential property adjoining land owned by Royalston Douglas Martin and Meredith Anne Martin in Lane Cove North. A boundary determination obtained in February 2025 confirmed minor encroachments by parts of the Martins’ carport and garage, including gutters, an eave and a carport post.
The Martins accepted the determination and said they would remove the encroachments, but rectification took time. Work was incomplete, one contractor initially worked on the wrong post, and later surveys identified further small encroachments. Xu commenced proceedings seeking removal orders as well as relief for alleged trespass, interference with survey marks, damages and aggravated damages. By June 2026, the encroachments had been removed; Xu did not pursue her remaining substantive claims, leaving costs as the only issue.
The Court’s Holding
Pike J dismissed the summons and ordered that each party bear its own costs. Although Xu achieved practical success because the encroachments were ultimately removed, that result alone did not entitle her to costs.
The Court found no unreasonable conduct by the Martins. Before the boundary determination there had been a legitimate dispute about the boundary; afterwards, the Martins consistently accepted that the encroachments should be removed and intended to do so as soon as possible. Delays and imperfect rectification work did not amount to an implicit refusal or justify treating the outcome as a capitulation. Xu had also abandoned her other claims.
Key Takeaways
- Practical success does not by itself justify a costs order where proceedings end without a merits determination.
- A defendant’s delay in completing agreed rectification work is not necessarily unreasonable conduct.
- Where neither side acted unreasonably and the substantive dispute is resolved, each party may bear its own costs.
Why It Matters
The decision illustrates the NSW approach to costs after a dispute resolves outside a merits hearing. Courts will assess the parties’ conduct in practical terms and will not conduct a hypothetical trial merely to decide costs.
For property-boundary disputes, a plaintiff who obtains eventual removal of an encroachment still needs to show that the defendant’s unreasonable conduct made litigation necessary or prolonged it.