Bentley & Ors v Drummoyne Counci l & Ors

:- apportionment where applicants not wholly successful KEY ISSUES: Costs:- orders where one respondent successful and other respondent fails Costs:- Class 2 - s 178 appeal against revocation of buildng approval under s 108 - Practice Direction 10

apportionment where applicants not wholly successful LEGISLATION CITED: Costs:- orders where one respondent successful and other respondent fails Costs:- Class 2 - s 178 appeal against revocation of buildng approval under s 108 - Practice Direction 10

DATE OF JUDGMENT DELIVERY: 05/05/1999

Applicants: Mr J Burrell (Solicitor) Solicitors: John Burrell Solicitors

First Respondent: Mr C McEwen (Barrister) LEGAL REPRESENTATIVES: Solicitors: Abbott Tout

Second & Third Respondents: Miss J Blackman (Barrister) Solicitors: Luis Porto Solicitors

Contents Paragraph Costs in Matter No. 40249 of 1998 1 - 19 Costs in Matter No. 20009 of 1999 20 - 26 Orders 27

IN THE LAND AND Matter No. 40249 of 1998 ENVIRONMENT COURT and 20009 of 1999 OF NEW SOUTH WALES Coram: Talbot J Decision Date: 5 May 1999 Matter No. 40249 of 1998 Peter Michael Bentley, Sandra Alexandra Bentley, Stella Chen & Stephen Chen Applicants v Drummoyne Council First Respondent Calitry Pty Ltd, Bullbear Investments Pty Ltd & Petria Pty Ltd Second Respondents Joe Di Giulio Third Respondent Matter No. 20009 of 1999 Calitry Pty Ltd, Bullbear Investments Pty Ltd & Petria Pty Ltd Applicants v Drummoyne Council Respondent REASONS FOR JUDGMENT

I delivered written judgment in this matter on 8 April 1999 and made final orders following further argument on 29 April 1999 when the question of costs was reserved.

The applicants seek an order for costs against all respondents in the Class 4 proceedings. The applicants in the Class 4 proceedings were not parties to the Class 2 proceedings. However, Mr Burrell, solicitor for the applicants, submits that if there is to be any apportionment of a costs order against the council, then consideration should be given to the fact that the evidence from the applicants' witnesses facilitated the conclusion of the Class 2 proceedings.

Mr McEwen, who appears for the council, claims that it, as first respondent, is entitled to at least 90 per cent of its costs because the issues were determined in favour of the council to that extent.

Miss Blackman, for the second and third respondents, also points out that her clients were ultimately successful in resisting nine out of 10 claims for relief in the Amended Application Class 4. Furthermore, the applicants were successful in only one out of the four issues ultimately argued and identified in par 16 of the judgment delivered on 8 April 1999. So far as the applicants' claim was based in law upon the grounds of Wednesbury unreasonableness and the council's failure to afford natural justice by its omission to adhere to declared procedure, the respondents were successful.

Miss Blackman also submitted that the applicants' failure to comply with the timetable for the filing and serving of relevant affidavits caused the hearing to run over an extra day, thereby resulting in further costs for the second and third respondents. In summary, she argued that, having regard to the whole of the circumstances, each party should pay their own costs except in respect of the third day, which should be paid by the applicants.

Although costs lie in the discretion of the Court, the ordinary rule is that, in general, the costs of proceedings follow the event ( Hally v Dennis (1955) 95 CLR 661; Donald Campbell & Co Ltd v Pollak [1927] AC 732; Latoudis v Casey (1990) 170 CLR 534).

The discretion must be exercised judicially so as to achieve what is fair and just between the parties according to the circumstances of the particular case.

An award of costs is compensatory in order to indemnify a successful party against the expense incurred by reason of the proceedings.

The test to be applied where a successful party fails on some issues was fully discussed in Proprietors of SP 13318 and SP 13555 v Lavender View Regency Pty Ltd & Anor (unreported 40015A of 1996 6 June 1997). The authorities referred to in that case show that the test to be applied is whether it would be more fair as between the parties that some exception should be made in the special instance so as to give effect to the notions of fairness and justice.

An analysis of the reasons for judgment show that the council was almost entirely successful in the proceedings. It successfully defended its determination of the development application and building application and realistically did not seek to support the alleged modification of the approval as being one made formally in accordance with the law.

It was necessary for the Court to hear and consider all of the evidence from the applicants' experts and the second and third respondents' witnesses in order to reach the ultimate conclusion that the building work erected to date has not been carried out in accordance with either the development consent or building approval, both validly granted by the council. In the course of determining the validity of the council's determinations, the Court was able to decide whether or not the construction of a building with the upper level of the ground floor slab at RL 10.55 was in accordance with the approvals.

If the case had been confined to the issues which arose directly between the applicants and the council, the council would have been successful. That is to say, as the Court found, the actions of the council in granting development consent and building approval were a valid exercise of power. If the council is seen to be unsuccessful in respect of any issue, namely the issue regarding the validity of the purported modification, it was only a minor and inconsequential matter so far as council's actions are concerned.

The doubts, which gave rise to the litigation, might have been resolved from the outset by the simple expedience of the second and third respondents producing the original survey certificate by which the relative levels, relied upon although not stated in the plans presented to the council, were established. The omission by the second and third respondents in that respect was the cause of their own undoing.

The dispute with the second and third respondents arose specifically as a consequence of observations made by one or more of the applicants who perceived that the building appeared to them to be erected at a level higher than their understanding of what was approved. The evidence discloses that the council reacted by issuing stop work notices and ultimately by revoking the building approval. Nevertheless, the applicants made a forensic decision and persisted with the Class 4 proceedings. The underlying objective of the applicants by pursuing the litigation was to contest the validity of the development consent and building approval. The applicants totally failed in that respect.

Mr McEwen claims the benefit of an order for the council's costs, or at least the major portion thereof. It is the Court's opinion that the applicants should pay the whole of these costs.

Having regard to the whole of the evidence in the proceedings and the circumstances outlined above, the Court is nonetheless satisfied that the applicants are entitled to an order for costs against the second and third respondents. There is no justification for making any special order for costs in respect of the third day as neither party complied with the Court's timetable for the filing of evidence.

The discrimination between the position of the council, as first respondent, and the second and third respondents is justified on the basis that, with one minor qualification, the council was shown to have acted properly, reasonably and in accordance with the law at all times. Ultimately, orders were made against the second and third respondents as a consequence of their own actions and omission, none of which could be attributed to the council.

The council was not a necessary party in order to ensure the applicants' success in the proceedings. This is demonstrated by the fact that the council called no evidence. It was however, entitled to appear for the purpose of defending its own determinations which the applicants sought to have declared invalid. The council is not, in my view, in the same position as the tribunal which was the subject of consideration by the High Court in R v Australian Broadcasting Tribunal; ex parte Hardiman (1980) 144 CLR 13.

Moreover, this is not a case where it would have been entirely appropriate for, if not incumbent upon, the council not to assume the position of a protagonist and to avoid incurring substantial costs even though the position of protagonist could have been filled substantially by the second and third respondents as the real contradictors (see observations in Oshlack v Richmond River Council (1998) 193 CLR 72 at 90). Although all of the respondents had an interest in upholding the validity of the council's determinations, the council nevertheless had a conflicting interest when it came to the question of allowing the erection of the building to continue otherwise than in accordance with its approvals.

In accordance with Practice Direction 1993 No. 10, the practice of the Court is that no order for costs is made in planning and building appeals unless the circumstances are exceptional.

Planning and building appeals are not defined. Clearly they encompass the common category of appeals against the merit decisions of councils to determine applications for development consent or building approval.

Under the Local Government Act 1993, an appeal by an applicant who is dissatisfied with the determination of a council in respect of an application for building approval is authorised by s 176. If an approval is revoked or modified under s 108, the applicant for the approval has a discrete right of appeal to the Land and Environment Court pursuant to s 178.

The combined effect of s 108, s 109 and s 110 is that the grounds for revocation or modification of an approval are strictly limited. Those grounds do not directly concern any questions of merit except, perhaps, as a matter of discretion.

I am not prepared to hold that an appeal pursuant to s 178 is contemplated by Practice Direction 10. However, if the appeal falls within Practice Direction 10, the Court is nevertheless satisfied that there were exceptional circumstances in this case. The plans misled the council to the extent that the height of the building relative to ground level is designed to be much greater than shown on any plan. The appellants, at all times proposed to erect the building relative to the benchmark established by Surveyor Eldridge rather than natural ground level as depicted on the plan.

Although the major part of the costs in the appeal will be absorbed in the Class 4 proceedings, the council, as the successful party, is nevertheless entitled to the exercise of the Court's discretion in its favour. The apportionment of the costs is a matter for the costs assessor.

I propose therefore to make an order that the second respondents in the Class 4 proceedings, as the applicants in Class 2 proceedings, pay the costs of the respondent council in respect of the appeal.

The Court makes the following orders:- Matter No 40249 of 1998 1. That the applicants pay the costs of the first respondent.

2. That the second and third respondents pay the costs of the applicants. Matter No 20009 of 1999 1. That the applicants pay the costs of the respondent in so far as they were costs incurred separately to Matter No. 40249 of 1998.

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