Bungendore Residents' Group Inc v Palerang Council & Anor

Commonwealth Bank of Australia v Mehta & Ors (1991) 23 NSWLR 84; Maxwell and Anor v Hornsby Council (2002) 121 LGERA 186; Mehta & Anor v Commonwealth Bank of Australia (1990) ATPR 41-026 ; CASES CITED: Mercantile Mutual Insurance (Australia) Ltd v Farrington (1996) 44 NSWLR 634 ; Multistar v Urban Affairs & Planning (No 2) (2000) 107 LGERA 460; Queensland v JL Holdings Pty Ltd (1996) 189 CLR 146; Residents Against Improper Development Incorporated & Anor v Chase Property Investments Pty Ltd [2006] NSWCA 323; Urban Transport Authority of New South Wales v Nweiser (1991) 28 NSWLR 471

APPLICANT Mr J Johnson SOLICITORS Environmental Defenders Office LEGAL REPRESENTATIVES: FIRST RESPONDENT Submitting appearance SECOND RESPONDENT Mr C Leggat SC SOLICITORS Harris & Company

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

40302 0f 2005 Bungendore Residents' Group Inc v Palerang Council and Navaroo Constructions Pty Ltd (No 2)

JUDGMENT ON NOTICE OF MOTION 1 Her Honour: I have reserved my decision in these Class 4 proceedings following the substantive hearing last year. The proceedings seek a declaration of invalidity of numerous development consents granted by the Council for a large subdivision at Bungendore. The First Respondent has filed a notice of submitting appearance and did not appear.

2 The Applicant has filed a Notice of Motion dated 27 November 2006 seeking leave to amend the Points of Claim in the proceedings to add an additional ground that the development applications are in respect of designated development, were not accompanied by an environmental impact statement and that the development consents are invalid.

3 The Notice of Motion is supported by the affidavit of Ms Jacquie Svenson dated 29 November 2006 annexing the Court of Appeal decision Residents Against Improper Development Incorporated & Anor v Chase Property Investments Pty Ltd [2006] NSWCA 323 (RAID). In RAID Tobias JA (Giles JA and McClellan Chief Judge at Common Law concurring) held at 179: I agree with the primary judge in Maxwell (at 195[43]) that it would be contrary to the intent of the legislation now in force to hold that an activity which falls within one of the categories listed in Pt 1 of Sch 3 should necessarily lose that character because it only forms part of a greater development or is not the main purpose of the development in respect of which the application has been made.

4 The Applicant submitted that this decision has changed the longstanding approach of this Court to the determination of whether a proposal is designated development under Pt 1 Sch 3 of the Environmental Planning and Assessment Regulation 2000 (the Regulation). I agree.

5 There is no application to lead further evidence. If the amendment is granted further written submissions are all that is required according to the Applicant.

6 The power to amend is set out at Pt 10.1 Land and Environment Court Rules 1979 (the Court Rules) as follows: (1) The Court may, at any stage of any proceedings, on the application of any party or without any such application, order, on terms, that any document filed in the proceedings be amended in such manner as the Court thinks fit. (2) All such amendments shall be made so as to lead to the determination of the real questions raised by or otherwise depending on the proceedings, to the correction of any defect or error in any proceedings, or the avoidance of a multiplicity of proceedings. … 7 Ritchie's Supreme Court Practice states at p 2452 that there are four propositions that define the limits of a general discretion to grant leave to amend: (1) the proposed amendment must not be so obviously futile that it would be liable to be struck out if it had appeared in the original pleading; (2) the application for leave to amend must be made for a proper purpose; (3) the amendment must not cause prejudice to the other party that cannot be compensated by appropriate consequential orders, including costs orders; (4) the amendment must not be contrary to the interests of the administration of justice.

The parties agreed about the general principles applicable on applications for leave to amend and agreed the key issue in this case is (3).

Relevant dates 8 The following dates are relevant to consider: (i) These Class 4 proceedings were commenced in April 2005 (ii) Hearing in August 2006 (iii) In August 2006 there was an amendment to the relevant local environment plan whereby the subject of the current development consents under challenge is now prohibited development (iv) 23 November 2006 decision of the Court of Appeal in RAID (v) This Notice of Motion to amend filed on 29 November 2006.

Applicant's submissions 9 The Court's decision should apply the law in force at the time it is handed down. Cases have stated that a liberal interpretation should be applied to the power to amend. The Applicant relied on Queensland v JL Holdings Pty Ltd (1996) 189 CLR 146 per Dawson, Gaudron, McHugh JJ.

10 The cause of action remains the same, being an action to have the development consents in issue declared invalid. The amendment sought is to the Points of Claim. The Applicant argued no prejudice is caused to the conduct of these proceedings if the amendment is allowed as there is no consequence for the substantive hearing already conducted.

Second Respondent's submissions 11 The Second Respondent argued it would suffer irreparable prejudice if the amendment is allowed for two "forensic" reasons. (i) Section 101 of the Environmental Planning and Assessment Act 1979 (the EP&A Act) cannot be relied upon if this amendment is allowed as the amendment is deemed to date from the commencement of the proceedings which were within the three months specified in s 101. If fresh proceedings were commenced now, based on the findings in RAID, s 101 would be able to be raised to bar the proceedings. (ii) Had this case been pleaded before August 2006 the Second Respondent could have sought to remedy its position by lodging new development applications for the current developments supported by an environment impact study (EIS). It has now lost that opportunity as such development is now prohibited under the amended local environmental plan (LEP). 12 The ground sought to be added could have been raised at the outset of proceedings and the issue dealt with as it was in RAID. Applicant in reply 13 The Applicant argued that the s 101 argument is irrelevant because these proceedings were commenced within time in terms of s 101 and the uncertainty occasioned by this challenge to the development consent has already arisen regardless of whether the amendment now sought is made. In other words, there is no greater uncertainty occasioned by this amendment to the pleadings than already exists. 14 In relation to the lost opportunity to make application for fresh development consents, whether such an application would succeed cannot be assumed, contrary to the Applicant's submissions that its approval was likely. Finding 15 The Court has wide discretion under Pt 10.1 of the Court Rules to allow amendments at any stage of the proceedings. Dawson Gaudron McHugh JJ in Queensland v JL Holdings Pty Ltd held at 155: Justice is the paramount consideration in determining an application such as the one in question. Save in so far as costs may be awarded against the party seeking the amendment, such an application is not the occasion for the punishment of a party for its mistake or for its delay in making the application. Case management, involving as it does the efficiency of the procedures of the court, was in this case a relevant consideration. But it should not have been allowed to prevail over the injustice of shutting the applicants out from raising an arguable defence, thus precluding the determination of an issue between the parties. In taking an opposite view, the primary judge was, in our view, in error in the exercise of her discretion.

16 In Mehta & Anor v Commonwealth Bank of Australia (1990) ATPR 41-026 leave to amend a pleading to enable a defence that proceedings were statute barred made after the hearing was not granted by Rogers CJ. His Honour considered the conduct of the proceedings in particular to determine if prejudice which could not be compensated for by costs or reopening of evidence would arise if the pleadings were amended and concluded it did arise. This decision was upheld on appeal; Commonwealth Bank of Australia v Mehta & Ors (1991) 23 NSWLR 84. 17 In Mercantile Mutual Insurance (Australia) Ltd v Farrington (1996) 44 NSWLR 634 Bryson J (as he then was) at 651 refused leave to amend after the hearing had been completed because: A very liberal attitude to amendments is required by the rules of court but the power is discretionary. An amendment which is brought forward for the first time after the trial of the proceedings has been concluded and when many decisions relating to presentation of the parties' cases of fact have been made, including decisions about what evidence should be put forward, what should not be tendered and what admissions should be made, faces special difficulties. 18 In Urban Transport Authority of New South Wales v Nweiser (1991) 28 NSWLR 471 Clarke JA (Mahoney and Meagher JJA concurring) upheld the trial judge's decision that leave to reopen a party's case to allow further evidence ought be granted after considering whether the interests of justice were best served by allowing or rejecting the application. If leave was granted there was no tactical advantage gained and the respondent would not have been prejudiced in any way. 19 The cases referred to above and relied on in argument before me focus on the impact of the amendment on the conduct of the proceedings and whether there is prejudice in that context. It is common ground that there is no disadvantage to the Second Respondent if leave is granted in the conduct of the next stage of the proceedings in that no further evidence is necessary in order to determine the additional ground sought to be raised. Separate evidence in relation to the exercise of the Court's discretion may be necessary but that is intended to be brought forward after the determination of the legal issues in the proceedings in any event, as already determined at the hearing last year. The Applicant stated that further written submissions are all that is required in order to deal with the legal issues raised and, subject to more evidence on the discretion issue, the Second Respondent does not disagree. In terms of the conduct of this litigation to date I do not consider there is any disadvantage to the Second Respondent for which costs would not be adequate compensation. 20 In relation to s 101, I agree with the Applicant's submission that there is no greater uncertainty afforded to the Second Respondent than already exists given that the Class 4 proceedings were lodged in time. This amendment seeks to add a new ground in these proceedings. It does not add a new cause of action. The issue of whether the ground is deemed to date from the commencement of proceedings does not strictly arise in these circumstances. 21 The further disadvantage raised by the Second Respondent is that due to the amendment of the LEP, if the development consents are declared invalid because the Applicant succeeds in relation to the designated development argument it seeks to add, it has no recourse such as lodging a further development application with an EIS in support to the Council. The fact that the LEP has been amended in this way is a matter unrelated to the conduct of the hearing. I do not therefore consider that is a relevant matter to consider in relation to this application.

22 The Second Respondent argued that the Applicant could have relied on this ground from the outset but I accept the Applicant's submission that the approach of this Court to the application of Sch 3 Pt 1 of the Regulation in relation to designated development was longstanding, apart from Maxwell and Anor v Hornsby Council (2002) 121 LGERA 186, until RAID. This was not a matter that could be said to have been overlooked or in relation to which there was a mistake on the Applicant's part. Nor has there been delay in making this application, the Notice of Motion having been filed on 29 November 2006. RAID was determined on 23 November 2006. 23 The Second Respondent also argued that it has spent many thousands of dollars pursuant to the current development consents. I do not consider that submission is material to this application to amend as that is a matter which is ultimately relevant to the exercise of the Court's discretion whether to grant relief in the substantive proceedings. 24 Given that the conduct of statutory duties under the EP&A Act by the First Respondent is in issue I also take into consideration the findings of Sheahan J in Multistar v Urban Affairs & Planning (No 2) (2000) 107 LGERA 460. His Honour was considering an application to amend to add additional grounds of challenge in relation to the making of an LEP in circumstances where no new cause of action was sought to be added and proceedings had been commenced within the three month period provided for challenges to LEPs in s 35 of the EP&A Act. His Honour allowed the amendments sought in the interests of justice in that case. I consider the orders sought in the Applicant's Notice of Motion dated 27 November 2006 should be made in the interests of justice, particularly as it will enable all matters at issue between the parties to be litigated at the same time. An amended Points of Claim must be filed within seven (7) days. 25 A timetable for written submissions is required and the parties are asked to confer and advise the Court of a proposed timetable within three days.

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