This is a contested motion for costs by the successful respondents in a tree dispute between neighbours in Class 2 of the Court's jurisdiction. The respondents claim costs of $6,552 for: (a) a pre-hearing view loss assessment report from a planner, (b) pre-hearing view/site drawings by an architect, and (c) legal fees for advice, which the respondents tell me concerned the appropriate procedure in the proceedings. The planner's and architect's documents were served on the applicants about a month before the hearing. In addition, the respondents claim an unspecified and unevidenced amount in respect of their motion for costs. The respondents were not legally represented at any stage of the proceedings. The applicants were, and are, represented by a solicitor.
The applicants purchased their residential property in 1985. In 2006 the respondents purchased the adjoining residential property to the west and down slope. At that time, the respondents' property included a pool in the front setback and a row of bamboo along the common boundary between the front of the respondents' dwelling and the front fence. The bamboo, which constitutes a hedge, separates the applicants' driveway from the respondents' pool. The respondents value the bamboo for the privacy it affords their pool. Historically, the applicants have enjoyed the setting of the sun from their deck and lounge room, as well as the views.
The applicants applied to the Court under s 14B of the Trees (Disputes Between Neighbours) Act 2006 (Trees Act) for an order that the respondents prune the bamboo at the respondents' expense to a height of four metres. Section 14E provides:
14E Matters of which Court must be satisfied before making an order
(1) The Court must not make an order under this Part unless it is satisfied:
(a) that the applicant has made a reasonable effort to reach agreement with the owner of the land on which the trees are situated, and
(b) if the requirement to give notice has not been waived, that the applicant has given notice of the application in accordance with section 14C.
(2) The Court must not make an order under this Part unless it is satisfied that:
(a) the trees concerned:
(i) are severely obstructing sunlight to a window of a dwelling situated on the applicant's land, or
(ii) are severely obstructing a view from a dwelling situated on the applicant's land, and
(b) the severity and nature of the obstruction is such that the applicant's interest in having the obstruction removed, remedied or restrained outweighs any other matters that suggest the undesirability of disturbing or interfering with the trees by making an order under this Part.
A Commissioner of the Court heard and dismissed the application: Burns & anor v St Clair & anor [2015] NSWLEC 1185.
Well prior to the hearing, the parties entered into settlement negotiations. In the negotiations and at the hearing, the respondents, whilst maintaining that the view obstruction was not serious, proposed that the parties share the annual cost of pruning the bamboo to a height of one metre above the floor of the upper deck of the applicants' dwelling. The respondents considered that any level lower than this would diminish the privacy in their front garden and pool area. On the Commissioner's finding, this would have given the applicants westerly views from a standing position on their deck. Prior to and at the hearing, the applicants proposed that annual pruning be to about 500 millimetres above the floor of the respondents' upper deck. On the Commissioner's finding, this would have given the applicants westerly views from a seating position on their deck. Prior to the hearing, the applicants also proposed that the pruning cost be shared, but at the hearing they withdrew this cost sharing aspect of their proposal.
The Commissioner was satisfied that there had been a reasonable effort to reach an agreement, and therefore s 14E(1) of the Trees Act was met.
However, the Commissioner concluded that the Court had no jurisdiction to make an order because the bamboo did not "severely" obstruct a view from the applicant's dwelling, and therefore s 14E(2)(a)(ii) of the Trees Act was not met. Accordingly, the Court's jurisdiction to make an order was not engaged.
In reaching that conclusion, the Commissioner considered five viewpoints nominated by the applicants. The Commissioner found that two were not views from a dwelling and therefore could not be considered: at [11], and that one was inapposite for an order: at [21]. The Commissioner found that the critical remaining two viewpoints in the applicants' dwelling were not "severely" obstructed; rather, the view obstruction was in the "moderate" range: at [19]. In making that finding, the Commissioner addressed the scale of qualitative and quantitative impacts described as negligible, minor, moderate, severe and devastating in the leading planning principle case of Tenacity Consulting Pty Ltd v Warringah Council [2004] NSWLEC 140, 134 LGERA 23 at [28].
In conventional litigation, costs are generally awarded to the successful party. In contrast, in (inter alia) Class 2 of the Court's jurisdiction, the Court is prohibited from making a costs order unless the Court considers that a costs order is "fair and reasonable in the circumstances": r 3.7(2) of the Land and Environment Court Rules 2007. All rational considerations are relevant to the formulation of the judgment whether a costs order is "fair and reasonable in the circumstances". In the end, the question is whether, in the opinion of the Court, they are of sufficient weight to overcome the presumptive rule that there will be no order as to costs. A no discouragement principle underlies this no costs rule. That is, persons generally should not be discouraged from making an application by the prospect of an adverse costs order if the application fails: Arden Anglican School v Hornsby Shire Council [2008] NSWLEC 103, 158 LGERA 224 at [9]-[10] per Biscoe J, which has often been cited including in Community Association DP 270253 v Woollahra Municipal Council [2015] NSWCA 80 at [34].
Rule 3.7(3) sets out non-exhaustively some of the circumstances in which the Court might consider the making of a costs order to be fair and reasonable. The respondents submit that paras (c), (d) and (f) of r 3.7(3) are engaged in this case:
(3) Circumstances in which the Court might consider the making of a costs order to be fair and reasonable include (without limitation) the following:
…
(c) that a party has acted unreasonably in circumstances leading up to the commencement of the proceedings,
(d) that a party has acted unreasonably in the conduct of the proceedings,
…
(f) that a party has commenced or continued a claim in the proceedings…where:
(i) the claim…did not have reasonable prospects of success, or
(ii) to commence or continue the claim…was otherwise unreasonable.
McLaren v Lewis (No 2) [2011] NSWLEC 176, 183 LGERA 344 illustrates how this costs rule can play out. In that case, an application for an order under the Trees Act that the applicant's neighbour prune trees along the boundary between their properties was dismissed because the Court found that the trees that formed a hedge did not "severely" obstruct views from the applicant's dwelling, and that the trees that did severely obstruct views did not form a hedge. Dismissing the successful respondent's subsequent costs motion, Preston CJ of LEC held that the applicant did not act unreasonably leading up to the commencement of, in commencing or in conducting the proceedings. His Honour rejected a submission that the bringing of the application under the Trees Act was vexatious or vindictive. Having brought the application, his Honour held, the applicant was entitled to have it heard by the Court, and the fact that she was ultimately unsuccessful was not sufficient in itself to attract an order for costs.
Of course, every costs motion in a Class 2 trees matter turns on its own facts and circumstances. There have been decisions under r 3.7(2) of the Land and Environment Court Rules in which partial costs orders have been made in tree disputes: Bailey v Gould [2011] NSWLEC 96, Fox v Ginsberg (No 3) [2011] NSWLEC 139, Morse v McMahon [2010] NSWLEC 13 and Low v Elliott [2008] NSWLEC 111. They are factually distinguishable and it is unnecessary for me to address them.
The respondents submit that for a number of reasons it is fair and reasonable in the circumstances to order the applicant to pay their said costs:
1. throughout the course of the dispute, the respondents made repeated attempts to negotiate and agree with the applicants for the pruning of the hedge to a height which would maintain the respondents' privacy yet give the applicants a better view, but the applicants were unwilling to compromise or negotiate, thereby forcing the applicants to spend thousands of dollars to defend the application. For example, the applicants did not accept the settlement proposal in the respondents' email to the applicants' solicitor a little over three weeks before the hearing, in which the respondents said they were not prepared to move from the height previously offered of a metre above the floor of the applicants' upper deck, any lower level would diminish the respondents' privacy in their front garden and pool area, but they were willing to consider tapering the height of the bamboo from the corner of their residence to an electricity pole in their garden. Again, for example, the applicants cancelled a hedge pruning which had been arranged in October 2013. It is convenient to say immediately that I do not find the cancellation a persuasive point given that the parties were in disagreement as to the height to which the hedge should be pruned;
2. the architect's drawings and planner's view loss assessment the respondents obtained, but which the applicants did not, were of significant value in coming to a just, quick and cheap resolution of the real issues, but despite providing those documents to the applicants' solicitor about a month prior to the hearing the applicants continued their refusal to agree, instead forcing the matter to a hearing;
3. the Commissioner decided that the Court had no jurisdiction because only two viewpoints really fell for consideration and they did not "severely" obstruct the view;
4. the applicants brought their application without competently researching and considering the legislation, the Court's jurisdiction and the Court's prior decisions in Class 2 matters;
5. the view loss assessment the respondents commissioned was "analogous" with the Commissioner's decision;
6. the respondents acted reasonably and in good faith in undertaking every action they could to avoid litigation and the Court found that the applicants had no basis for the application and that the applicants' case was unmeritorious. The respondents did not plant or cultivate the hedge and were happy to prune it and were forced to spend money or comply with the application.
The respondents' costs case, they say, is that after they served the applicants with the view assessment report and architect's drawings about a month before the hearing, the applicants should have realised their case was hopeless and given up. Even if that costs case were to be accepted, the immediate difficulty with it is that the bulk of the costs claimed by the respondents were incurred prior to such service. Logically, on that costs case, they cannot recover those antecedent costs. The only costs claimed and incurred thereafter appear to be an unparticularised part of their legal advice costs; but I observe that some of that part was incurred after the Commissioner delivered judgment.
However, I do not accept that costs case, nor the other ways in which the respondents put their costs case. I do not consider that the applicants acted unreasonably in circumstances leading up to commencement of the proceedings or in the conduct of the proceedings, nor that they commenced or continued a claim where the claim did not have reasonable prospects of success or where such commencement or continuation was otherwise unreasonable. The Commissioner found that the parties had made a reasonable effort to reach agreement: at [7]. Thanks to the negotiations between the parties prior to and at the hearing, the height pruning difference between them was reduced to 500 millimetres. The parties were very close to settlement. In the circumstances, I do not consider it unreasonable for either not to have accepted the other's settlement offer. They were both entitled to have the matter determined by the Court. The respondents' planner in his view assessment report, which was served on the applicants, opined that the view obstruction was only "minor". The Commissioner found that the view obstruction from the critical viewpoints was "moderate". That was insufficient to attract the jurisdiction of the Court, which by statute requires a finding that it be "serious". But it was greater than the view obstruction description of "minor" for which the respondents contended through their expert. It was not unreasonable for the applicants to seek to persuade the Court that the view obstruction should be described as serious. The mere fact that they were unsuccessful in that endeavour is insufficient to categorise their conduct as unreasonable.
Contrary to the respondents' submissions, on the evidence I am not prepared to conclude that the applicants or their solicitor did not understand or competently consider the "severe" statutory criterion, the legislation, the Court's jurisdiction and relevant case law. Nor do I accept that the applicants' conduct should be viewed as unreasonable because they ultimately proposed that the respondents should pay for any pruning, particularly given that the bamboo was on the respondents' property. I accept that the respondents acted reasonably and in good faith, but it does not follow that the applicants acted unreasonably.
The order of the Court is that the respondents' notice of motion filed on 19 June 2015 is dismissed.
[3]
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Decision last updated: 29 July 2015