Enkelmann v Stewart[2025] QCA 162

SUPREME COURT OF QUEENSLAND

1. [1]
   MULLINS P:  The appellants were the first and second plaintiffs in a proceeding in the Trial Division commenced in December 2016 in which they claimed damages for nuisance or, in the alternative, damages for negligence and an injunction restraining the respondents from diverting water from their adjoining property Mikandra onto the appellants’ property Riverview.  Mikandra is uphill from Riverview.  The respondents brought a counterclaim in December 2022 for damages for nuisance caused by the levee constructed by the appellants on Riverview between 2013 and 2017 having the effect of redirecting water across Mikandra and causing the water to pool on Mikandra.  The respondents pursued injunctive relief rather than quantify the damage they sustained.  The appellants defended the counterclaim.  The duration of the trial was five weeks between 8 and 26 May 2023 and 18 and 28 March 2024.  On 14 August 2024, the appellants gave notice to the respondents that they intended abandoning their claim against the respondents.  The final submissions of the parties were limited to the respondents’ counterclaim.  Oral submissions were made on 2, 5 and 6 September 2024.  The primary judge’s reasons were delivered on 17 April 2025: Enkelmann v Stewart [2025] QSC 77 (the reasons).
2. [2]
   Further submissions were made by the parties as to the terms of the orders to reflect the reasons.  The primary judge made final orders on 27 June 2025 for which further reasons were given: Enkelmann v Stewart (No 2) [2025] QSC 154 (the further reasons).  Judgment was entered for the respondents against the appellants on the counterclaim.  Orders 3 to 6 are in the nature of a mandatory injunction in relation to the removal of the Temporary Levee on the appellants’ land and the restoration of the Below-Ground Drain and the contours within an area identified as the Area of Interest to the Natural Ground Level with a survey report required to ensure that the works required by the orders have been carried out.  The terms used in the orders are defined in the orders.  It appears from the further reasons (at [10]) that by the time the submissions as to the form of the final orders were completed, the parties had largely worked out the terms.  The issues that remained outstanding were in respect of order 3(d) and 6(f) and were resolved in the further reasons.  The final orders are detailed and prescriptive.  The primary judge identified (at [11] of the further reasons) that seven drafts of the final orders had been exchanged.
3. [3]
   In anticipation of the final orders being made by the primary judge, the appellants’ solicitors emailed a letter to the respondents’ solicitors dated 26 June 2025 advising of their instructions to appeal the order dismissing the counterclaim and to apply for a stay of that order.  To avoid the necessity of making the application for a stay, the appellants sought the respondents’ undertaking (undertaking request) that, in the event the appellants’ appeal were successful, the respondents would pay the appellants:

1. “1.
   their actual costs of complying with orders 3 and 5 of the orders to be made by her Honour; and

1. 2.
   their reasonable costs and expenses of reinstating the Temporary Levee, the Below Ground Drain and the Area of Interest, as each of those terms are defined in the orders to be made by her Honour, to their present conformation and condition, including any costs or expenses incidental to such reinstatement and rehabilitation including any surveying costs.”

4. [4]
   The respondents’ solicitors responded to the undertaking request by letter dated 27 June 2025.  They noted that the undertaking request did not specify the appellants’ estimate of the costs of removal and reinstatement of the Temporary Levee or any assessment of the appellants’ prospects of success on the appeal.  The letter noted the pleading by the appellants at paragraph 94(h) of the fourth further amended statement of claim (statement of claim) that the costs of removal of the Temporary Levee would total $18,000 and that the appellants had given notice of preliminary works having commenced on 26 May 2025 and that costs associated with those works (undertaken before any order was made) were not captured by the undertaking request.  The letter also noted the costs of reinstatement of the Temporary Levee pleaded at paragraph 94(g) of the statement of claim were $14,699.  (The appellants pleaded at 94(e) of the statement of claim that the temporary levee bank was constructed “to provide potential protection to Riverview from the effects of floodwater” following the new course (as defined in paragraph 16 of the statement of claim) after works alleged to have been carried out on Mikandra.)  The letter noted that based on the findings made in the reasons, if the floodplain spills during a weather event, the Temporary Levee is likely to cause the respondents substantial losses and interference, including disruption to farming activities, repair costs, borrowing costs to fund repair costs and to provide working capital in lieu of lost cropping income, capital losses associated with their machinery and lost profits from crop losses.  It was therefore suggested that the more reasonable course was that the appellants should comply with the order and remove the Temporary Levee and, if successful on appeal, rebuild the Temporary Levee.  The respondents were therefore not prepared to meet the undertaking request.
5. [5]
   The appellants filed a notice of appeal on 3 July 2025 seeking to set aside the orders of the primary judge made on 27 June 2025 and, in lieu, seeking judgment for the appellants on the counterclaim.  Although it is the final orders that are the subject of appeal, the findings that are challenged are those made by the primary judge in the reasons.  Contemporaneously with the notice of appeal, the application was filed seeking a stay of orders 3 to 6 until the determination of the appeal or earlier order.  Upon the appellants giving the usual undertaking as to damages, Bradley JA on 10 July 2025 varied order 3 by amending the date for compliance from 18 August 2025 to 22 September 2025 and order 5 by amending the date for compliance from 30 September 2025 to 4 November 2025.  The stay application was then heard on 22 August 2025.  An amended notice of appeal was filed on 27 August 2025.  The appeal is listed to be heard on 22 October 2025.
6. [6]
   During the hearing of the stay application, I raised with the parties the possibility of whether some part of the works required for the removal of the Temporary Levee to address the risk of damage to the respondents from the summer rains later this year could be carried out and the balance of the orders for the restoration of the Below-Ground Drain and the Area of Interest to the Natural Ground Level and all necessary surveys be stayed pending the determination of the appeal.
7. [7]
   Further written submissions were filed by each party after the hearing of the stay application that disclosed the attempts by the parties to canvas a compromise of the works immediately required under the orders pending the determination of the appeal to mitigate the prospect of further damage sustained on Mikandra and a stay of the balance of the works until the appeal was determined.
8. [8]
   By letter dated 25 August 2025 from the appellants’ solicitors to the respondents’ solicitors, the appellants renewed their undertaking request in order to resolve the stay application.
9. [9]
   The respondents’ solicitors emailed the respondents’ refusal of the renewed undertaking request on 26 August 2025.  The respondents noted the appellants gave sworn testimony “that they wanted to, and would, remove the levee when the natural state on Mikandra was returned” and the primary judge found that Mikandra is (and always was) in its natural state and that finding was not challenged on the appeal.  The respondents pointed out that the appellants’ abandoned case was the Temporary Levee always was and remained unnecessary and undesirable.
10. [10]
    The respondents’ solicitors emailed the appellants’ solicitors on 29 August 2025 putting forward a “hybrid form of stay” to which the respondents were prepared to agree:

1. 1.
   Orders 3(b) and (d) of the Judgment would be stayed, such that the Appellants would not need to restore the below ground drain or the whole of the Area of Interest (save for the levee batters to the extent they are situated in the Area of Interest) pending determination of the appeal;

1. 2.
   Orders 3(a), 3(c) and 4 of the Judgment would need to be complied with by the Appellants, which would necessitate the removal of the temporary levee (and the associated batters) and transporting the soil to the appropriate location in accordance with the Judgment and notice being given that these works are completed;

1. 3.
   Orders 5 & 6 of the Judgment would be stayed - being the requirement to obtain the survey - pending determination of the appeal; and

1. 4.
   Costs of the Stay application be the parties costs of the Appeal.”

11. [11]
    The appellants’ solicitors responded to the offer by email on 1 September 2025.  The appellants made some observations in respect of that offer.  First, they considered it was ambiguous as to whether the area on which the Temporary Levee sits would be restored to either the present level of the land immediately adjacent to the area or to the Natural Ground Level and inferred it was the former.  They expressed their concern that this may cause further disputes as to compliance with the terms of the offer.  Their second comment was that the offer requires the removal of the Temporary Levee (and its batters) without that soil being placed on Riverview Blocks 4, 8, 9 or the part of Block 7 to the west of the eastern-most border of the Area of Interest.  The appellants observed this was “simply uncommercial” and would cause the appellants to incur more costs than they would otherwise incur by complying with the final orders.  The email also noted that the removal of the Temporary Levee and its batters will require a significant volume of soil to be carted elsewhere and the appellants had intended for that soil to be used to fill the depressions in the Below-Ground Drain and Area of Interest in order to restore those areas to Natural Ground Level in accordance with the final orders.  Instead, the respondents’ offer would require the appellants to incur further time and costs to cart the removed soil to, at least, the module pads on Riverview Block 3 which are approximately 500 metres from the Temporary Levee.  The appellants consider that the time and cost associated with doing so would exceed that which would otherwise be required by the appellants performing the remedial works in one project.  The third comment was that the appellants would be open to resolving the stay application on the basis that the soil removed from the Temporary Levee is permitted to be used to fill in the depressions identified as being below the Natural Ground Level, being those areas north of the Below-Ground Drain and the extension of the Below-Ground Drain which extends easterly from where the Below-Ground Drain enters Riverview.  The appellants pointed out that would require “a hybrid of the works contemplated by paragraph 3(d) of the primary judge’s order, rather than simply dividing up the works according to the relevant sub-paragraphs”.  Order 3(d) requires the appellants to restore the contours within the Area of Interest to the Natural Ground Level.  The appellants made a counteroffer to resolve the stay application:

1. 1.
   Paragraphs 3(b), 5 and 6 of the Order of Williams J made on 27 June 2025 (Primary Order) be stayed pending termination of the appeal;

1. 2.
   Paragraph 3(d) of the Primary Order be stayed pending termination of the appeal except to the extent that the paragraph applies to:

1. (a)
   any part of the Area of Interest which is north of the Below-Ground Drain and which is presently below the Natural Ground Level; and

1. (b)
   that part of the Area of Interest which is south of the Temporary Levee and east of marker D1 on Schedule B and which is presently below the Natural Ground Level;

1. 3.
   Paragraph 3(c) of the Primary Order be stayed pending termination of the appeal to the extent it applies to the areas in paragraphs 2(a) and 2(b) above; and

1. 4.
   Paragraph 4 of the Primary Order be stayed pending termination of the appeal to the extent that it applies to paragraphs 3(b) and 3(d) of the Primary Order.

1. 5.
   Costs of the stay application be the parties’ costs in the appeal.”

12. [12]
    It appears that counter offer lapsed.

Principles relevant to stay

13. [13]
    The principles relevant to exercising the discretion on whether to order a stay of the orders below pending appeal are not disputed: Cook’s Construction Pty Ltd v Stork Food Systems Australasia Pty Ltd [2008] 2 Qd R 453 at [12]-[15].  Relevant considerations include the following.  The judgment after trial should not be treated as “merely provisional” and the successful party is entitled to the fruits of its judgment.  Where it is possible for the Court to come to a preliminary assessment of the case on appeal, the prospects of success on appeal may be a significant relevant consideration.  If the prospects of the appeal are “very poor”, that favours the refusal of the stay.  Another consideration is whether the appeal might be rendered nugatory by a refusal of the stay and whether the appellants would be “irremediably prejudiced” if the stay were not granted.
14. [14]
    In the circumstances of this appeal, where the stay is sought in respect of orders which constitute mandatory injunctions, the prejudice caused to the respondents if the stay were granted is also a relevant consideration.
15. [15]
    An additional factor that was the focus of submissions was whether, if the appellants complied with orders 3 to 6 pending the determination of their appeal and then succeeded on the appeal, they would be entitled to obtain a judgment on the appeal for restitution as a result of complying with orders 3 to 6.  The respondents conceded in their further written submissions that a successful appellant only has “a restitutionary right in relation to any money paid or property transferred which is still in the respondent’s possession under the judgment which is reversed”.  See White v Tomasel [2004] 2 Qd R 438 at [67] (per McMurdo J) that was applied by Buss P in Kipoi Holdings’ Mauritius Ltd v Kirman (as joint and several Admins of Tiger Resources Ltd) (Subject to Deed of Co Arrangement) [No 4] [2024] WASCA 145 at [103] where it was observed that the guiding principle is restitution or restoration of an appellant’s money or property, as distinct from awarding damages to compensate the appellant for loss suffered as a result of the erroneous judgment or order.
16. [16]
    All the relevant factors on whether a stay of the orders should be granted in the circumstances of the history of the litigation between the parties must be identified and weighed up to determine whether the appellants have demonstrated that it is an appropriate case for a stay: Day v Humphrey [2017] QCA 104 at [5].

Appellants’ submissions

17. [17]
    The appellants placed significant weight on their willingness to remove the Temporary Levee and restore the Area of Interest on the condition of the undertaking request made of the respondents as a reasonable course proposed by the appellants to avoid the necessity for a stay application.
18. [18]
    On the hearing of the stay application, the appellants’ counsel appropriately conceded that the respondents’ response to the undertaking request had to be considered in the context of the conduct of the appellants of their claim in the Trial Division.
19. [19]
    The affidavits relied on by the appellants show that substantial work will have to be undertaken by Mr Enkelmann and his son including removing bales of vegetation already cleared for the purposes of compliance with the orders, several days’ work dealing with further vegetation and cultivation of the Area of Interest after the earthworks have been undertaken to avoid erosion.  Substantial earthworks are required which will involve engaging the agreed surveyor at a cost in the vicinity of $20,800.  There is a quote for the earthmoving works to achieve compliance with the orders in the vicinity of $65,000.  If the appellants succeed on the appeal and the Temporary Levee is subsequently reinstated that will involve earthworks in the vicinity of $78,000.  There is an opportunity cost for the estimated time of 20 days’ work required of Mr Enkelmann and his son in complying with the final orders.
20. [20]
    The appellants offer an undertaking as to damages which is supported by evidence of its value, if a stay were granted.
21. [21]
    The appellants now seek to maintain the Temporary Levee for the protection it gives to Riverview even though that was not their case in their abandoned claim and did not form part of their defence of the counterclaim.

Respondents’ submissions

22. [22]
    The respondents submit that the appellants’ prospects of success on the appeal are poor by reference to their analysis of the grounds of appeal and the difficulty for the appellants in succeeding when they led no evidence at the trial to contradict the opinion of the respondents’ expert Dr Markar whose evidence was accepted by the primary judge and there was no challenge to the primary judge’s rejection of the appellants’ evidence and the evidence of their son.  The respondents emphasised that there is potential for greater prejudice to them from the ongoing harm caused to Mikandra during all flood events, if the works required under the primary judge’s orders were not carried out.
23. [23]
    The respondents rely on the findings of the primary judge based on the acceptance of the respondents’ experts Dr Markar and Professor Bennett that the Temporary Levee has caused (and causes) significant adverse flood impacts on Mikandra by causing water to bank up and pool inside Mikandra.
24. [24]
    The respondents rely on their concerns expressed in Mr Stewart’s affidavit filed to oppose the stay that they will continue to suffer damage of the type accepted by the primary judge, if the stay of the final orders pending appeal was granted.
25. [25]
    The respondents submit that the Court should take judicial notice of the prospect of rural properties in Queensland experiencing flood events from time to time during the summer wet season and that there is a material risk to the respondents if the Temporary Levee were to remain in place for the imminent wet season.
26. [26]
    Mr Stewart also deposes to being informed by his solicitors that the respondents spent about $2.616m on legal costs in respect of the claim.

Have the appellants demonstrated an appropriate case for a stay?

27. [27]
    At the hearing of the stay, I raised deficiencies in the notice of appeal which resulted in the filing of an amended notice of appeal.  Even though the respondents submit that the amended notice of appeal remains deficient, it at least now identifies specific findings of the primary judge which are relied on as being in error to support the issues raised by the notice of appeal.  Those issues can be summarised as:

1. Did the primary judge err in concluding (at [83] of the reasons) that the “turn back defence” (based on Gartner v Kidman (1962) 108 CLR 12 at 47-49) was not available in that:
   1. the primary judge erred in finding (at [75]) that the relevant water flow over Mikandra and onto Riverview at the location of the Temporary Levee is a natural watercourse;
   2. the primary judge erred in finding (at [118]) the appellants had failed to demonstrate they used reasonable care and skill in constructing the Temporary Levee;
   3. the primary judge erred in finding (at [136]) the appellants had failed to demonstrate that the Temporary Levee did no more than what was reasonably necessary to protect the appellants’ use and enjoyment of Riverview.
2. Did the primary judge err (at [209]-[210]) in concluding that the Temporary Levee caused a substantial and unreasonable interference with the use and enjoyment of Mikandra?

28. [28]
    During the hearing of the stay application, I observed that because of the limited materials available to me on the application and its relative urgency, I was unable to form a considered view on the appellants’ prospects of success.  The respondents’ submissions assert that the prospects are poor.  Limited as I am to the affidavits filed in support of the stay application, the reasons, the further reasons and the submissions made on the stay application with supporting documents, I remain of the view that all that can be said about the prospects of the appeal is that the appeal is arguable.  The consideration of the prospects of success therefore does not favour either the grant or the refusal of the stay.
29. [29]
    The respondents have been a party to litigation commenced by the appellants almost nine years ago, the appellants’ claim was abandoned after almost eight years of litigation and the respondents finally obtained judgment in their favour on the counterclaim this year.  It is a factor in favour of refusing the stay that the respondents are entitled to the benefit of the judgment in their favour.  The history of the litigation adds weight to that factor.  For the same reason little or no weight should be given to the respondents’ refusal of the undertaking request.
30. [30]
    Another factor in favour of the respondents is the imminence of another summer wet season and the potential for the respondents to suffer the same type of damage that was identified by the primary judge due to the effect of the Temporary Levee on the pooling of water on Mikandra after rain events.
31. [31]
    Because the Temporary Levee was created by earthworks and the removal of the Temporary Levee and associated works and restoration of the Area of Interest involves the removal of earthworks, by complying with the final orders the appellants are not at risk of the appeal being rendered nugatory by a refusal of the stay or being “irremediably prejudiced” (apart from the cost of the compliance with the final orders) as the Temporary Levee can be restored at a relatively modest cost, if the appellants succeed on the appeal.
32. [32]
    Little or no weight should be given to the appellants’ desire now to maintain the Temporary Levee for the protection of Riverview when that was not an aspect of their defence of the counterclaim.
33. [33]
    It favours the appellants that they can offer a valuable undertaking as to damages to support the stay.  It also favours the appellants that, if they were to succeed on the appeal and a stay were not granted in the meantime, they will not recover the expenses incurred in complying with the final orders and will be prejudiced by the opportunity costs in respect of the time spent by Mr Enkelmann and his son in connection with the works undertaken to comply with the final orders.
34. [34]
    The expenses of complying with the final orders before the determination of the appeal have to be considered, however, in the context of the history of the litigation between the parties.  It was acknowledged appropriately by the appellants’ counsel on the hearing of the application that there was a “big disproportion” between the legal costs spent by the appellants on a trial lasting five weeks (with another five days of submissions) and the estimated costs (including opportunity costs) for compliance with the final orders before the appeal is determined.  The relatively modest cost, even on the appellants’ own figures, of compliance with the final orders including the cost of reinstating the Temporary Levee if the appeal is successful is highlighted by comparison with the estimated sum of $2.616m which the respondents spent on legal costs in defending the abandoned claim.
35. [35]
    Balancing the relevant factors favours refusing the stay.  The respondents’ entitlement to the benefit of the final orders coupled with the potential for further damage to Mikandra if the Temporary Levee remains in place for this coming wet season far outweighs the relatively modest expenses that will be incurred if the appellants comply with the final orders and succeed on their appeal.

Orders

36. [36]
    Ultimately there was a genuine attempt by both parties to explore the possibility of some works being undertaken in accordance with the final orders but other works being deferred until the determination of the appeal.  Even though the appellants have not succeeded in their stay application, it is appropriate in those circumstances that the costs of the stay application be each party’s costs in the appeal.
37. [37]
    It follows that the orders which should be made are:

1. The application for the stay is refused.

2. The costs of the stay application be each party’s costs in the appeal.