(g) Any order for indemnity costs could discourage the proper abandonment at or prior to the hearing of unwinnable points. (Reference was made to Huntsman Chemical Company of Australia Ltd v Interactive Pools Australia Ltd (1995) 36 NSWLR 242 and to Engadine at 370 [11].)
6 In my opinion the council must pay the costs of both respondents and on the usual party and party basis. I have come to this conclusion for the following reasons.
7 Although the proceedings may be characterised as public interest litigation, that fact alone is not determinative. In the Engadine case I summarised (at 371 [15]) those factors which would qualify a proceeding as public interest litigation as follows: the public interest served by the litigation; whether that interest is confined to a relatively small number of people in the immediate vicinity of a development, or whether the interest is wider; whether the applicant sought to enforce public law obligations; whether the prime motivation of the litigation was to uphold the public interest and the rule of law; whether the applicant has no pecuniary interest in the outcome of the proceeding.
8 I am prepared to assume that the council in the present case brought the proceedings on behalf of those of its local residents who may be adversely affected, that the council had no pecuniary or private interest to protect, and that it was seeking to enforce compliance with the procedural requirements regarding the exercise of the discretion to grant consent. That is, I am prepared to assume that this case may be characterised as public interest litigation.
9 As I noted above, that is not, however, determinative of the question of costs. It is only one of many factors to be taken into consideration. In Oshlack, the High Court held that the fact that litigation may be characterised as public interest litigation was a relevant consideration in the exercise of the court's discretion as to costs, but was not determinative.
10 The primary consideration remains the principle described by McHugh in Oshlack at 97 [67], which I have set out in par [4] above. That is, the successful party should be compensated by the unsuccessful party for the costs it has incurred and which it would not have otherwise incurred if it had not been brought into court. Moreover, "the traditional exemptions to the usual order as to costs focus on the conduct of the successful party which disentitles it to the beneficial exercise of the discretion" (McHugh J in Oshlack at 97 [69], see also Gaudron and Gummow JJ at 87 [37]). There is nothing in the conduct of the successful parties in the present case which would come near disentitling conduct.
11 The determination of the ambit of cl 71(f) of the Regulation and the hazardous industry document did not occupy a great deal of the hearing time and could have been ready resolved without the calling of any evidence, other than tendering the document itself.
12 In submitting that it should not have to bear the costs of both respondents, the council relies upon the following obiter dicta of Gaudron and Gummow JJ in Oshlack at 90 [46]
In a significant number of such litigious disputes, it will, in accordance with the reasoning in R v Australian Broadcasting Tribunal; Ex parte Hardiman [(1980) 144 CLR 13 at 35-6], be entirely appropriate for, if not incumbent upon, the local government body not to assume the position of a protagonist and to avoid incurring substantial costs. The position of protagonist will be filled by the party against which injunctive relief is sought and which is the real contradictor in respect of the application for declaratory relief.
13 I am not, of course, bound by obiter dicta of the High Court. Nor am I bound by a decision of the High Court constituted by any single justice, although such a decision is entitled to appropriate weight and respect: Appleton Papers Inc v Tomasetti Paper Pty Ltd [1983] 3 NSWLR 208, R v Riscuta [2003] NSWCCA 6. In Riscuta, Heydon JA, speaking for the court, held that a statement of principle by two judges of the High Court was not binding. His Honour said at par [101]:
The dictum of Gaudron and Hayne JJ, though it is entitled to the greatest respect and though it is of persuasive value, is not an "appellate decision" of the High Court. It is a statement of principle, no doubt a considered one, offered as a dictum.
14 Both of the respondents in the present case were properly joined - the Minister as the authority whose consent it was sought to invalidate and the Sydney Ports Corporation as the beneficiary of the consent and having a pecuniary interest in the outcome. The Minister's participation in the hearing was properly limited, in accordance with the Hardiman principle, to submissions going to the powers and procedures of the consent authority (The Queen v The Australian Broadcasting Tribunal & Ors; Ex Parte Hardiman (1980) 144 CLR 13 at 36). The involvement of Sydney Ports Corporation was not so limited. The respondents' cases, moreover, did not overlap and each presented a different part of the defence case to the council's claim.
15 Moreover, I observe that I received considerable assistance in the resolution of this case by the submissions of senior counsel for the Minister, Dr J E Griffiths SC. For all of these reasons, I am not inclined to limit costs to be ordered to only one set of costs.
16 The application for indemnity costs is based on the abandonment by the council of part of its claim at the commencement of the hearing. Paragraph 13(b) of the council's amended points of claim alleged that the Minister failed to properly consider the findings and recommendations of the Commission of Inquiry before determining the development application. Paragraphs 14 to 17 of the amended points of claim challenged the validity of certain conditions of the development consent. On the first day of the hearing, at about 9:30 am, the respondents were given a written outline of the council's submissions which stated that the council does not press pars 13(b) and 14 to 17 of the amended points of claim. When senior counsel for the council commenced his opening submissions he said that the applicant does not press pars 13(b) and 14 to 17 of the amended points of claim.
17 The claim for indemnity costs is said to arise as a consequence of having to prepare a case to meet the abandoned elements of the claim, which costs could have been avoided entirely if the council had given notice earlier of its intention to abandon these parts of its claim. Moreover, Mr B R McClintock SC, appearing for the second respondent, says that par 13(b) was always a genuinely hopeless claim and there was no basis for making the allegation.
18 I am aware of the reality that costs ordered to be paid by one party to another cover only a proportion of the actual costs which the successful party has incurred. Nevertheless, the ordinary rule is that a successful party usually receives no more than an order that its costs shall be paid on a party and party basis. In Huntsman Chemical Company, the Court of Appeal declined to award the indemnity costs where a number of related appeals were abandoned upon the appeal being called. Kirby P accepted the reality that it is only shortly before the hearing of proceedings that parties and their lawyers typically give them their full attention. In particular, Kirby P made the following observation (at 247-8):
Considerable store was placed upon the late abandonment of the appeals and the acknowledgment that this was said to provide that the appeals were always hopeless. Whilst that argument has force, it would be undesirable for the Court, by its costs orders, to discourage the proper, but late, abandonment of unwinnable appeals or points. Yet this might occur if there were a suggestion that such an act of responsible advocacy would be penalised by the making of a special costs order.
19 In the Engadine case I said (at 370 [11] - [12]):
At the final hearing, the applicant sensibly abandoned its claims based on unreasonableness, estoppel and contract, those claims having no real prospect of success. By way of contrast, in Broadwater Action Group the applicant acted unreasonably in instigating and pursuing claims at hearing, notwithstanding the fact that it had absolutely no evidence whatsoever to support its claims which thus had no chance of success. Similarly, in Maule v Liporoni (No 2) (2002) 122 LGERA 216, the applicant persisted with claims that were baseless without regard to whether there was any evidence in support thereof and which had no chance of success.