Council of the City of Sydney v Chapman

Land and Environment Court (NSW)|2007-03-12|Before: Jagot J, Mr J

CITATION : Council of the City of Sydney v Chapman [2007] NSWLEC 146

APPLICANT Council of the City of Sydney PARTIES : RESPONDENT Colin Thomas Chapman

KEY ISSUES: Costs :- civil enforcement - proceedings settled after grant of development consent - proceedings commenced without notice - no order as to costs

CASES CITED: Kiama Council v Grant (2006) 143 LGERA 441; Melbourne University Publishing Ltd v Williamson [2005] FCA 1910

APPLICANT Mr S Kondilios (solicitor) SOLICITORS Maddocks Lawyers LEGAL REPRESENTATIVES: RESPONDENT Mr J Hannaford (solicitor) SOLICITORS Hannaford Lawyers

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

COUNCIL OF THE CITY OF SYDNEY Applicant

JUDGMENT Jagot J: 1 This is a notice of motion by the Council of the City of Sydney seeking an order that the respondents pay the Council's costs of the proceedings as agreed or assessed. In response to the Council's application, the respondents also seek an order that the Council pay their costs of the proceedings, as well as an order for costs of the notice of motion. The proceedings are class 4 proceedings arising out of circumstances relating to a spa, which I will briefly describe.

2 On 5 January 2006 the Council served on the respondents a notice of its intention to give an order under s 121B of the Environmental Planning and Assessment Act 1979 (the EPA Act) to demolish or remove the spa bath located on the north-eastern side of the balcony on the property known as unit 22/12 - 20 Rosebank Street, Darlinghurst. On 13 January 2006 the respondents made detailed representations to the Council as to why the order should not be given, including that the spa bath had been on the property in another location since 1989 and was relocated to the balcony in 2001 when the respondents were carrying out fairly substantial building works to the property pursuant to a development consent granted by the Council, being development consent 00632/98.

3 On 17 March 2006 the Council responded to the effect that the spa bath was not exempt or complying development, the building plans approved for the 1998 development consent did not show a spa bath in the location on the balcony, and a development application was required to be submitted by the respondents to the Council.

4 On 3 April 2006 the Council served a final order requiring the spa bath to be demolished or removed within twenty-eight days. The respondents, or at least one of them, attempted to contact the Council and succeeded in so doing on 13 April 2006. During a telephone conversation with a Council officer, the Council advised that the order would not be enforced if a development application were lodged, at least until after the development application had been determined. On the same day, 13 April 2006, the respondents hired a consultant town planner to prepare a development application on their behalf and to liaise with the Council.

5 Between 19 and 26 April 2006 there were communications between the respondents' planning consultant and the Council, culminating in a letter from the consultant dated 26 April 2006. The letter set out a detailed history of the presence of the spa bath on the property and submitted that, unless the Council could explain why a development application was required, it appeared to the consultant unnecessary for such an application to be lodged. Thereafter, one of the respondents spoke to the consultant on a number of occasions and was informed that no response had been received from the Council.

6 The Council apparently instructed its solicitors with respect to the matter on 9 June 2006. The Council's solicitors filed the class 4 application on 11 July 2006 and served the application on 18 July 2006. There was no correspondence from the Council or its solicitors before 18 July 2006 to the respondents putting them on notice that the class 4 proceedings would be commenced, the class 4 proceedings would seek the orders in fact sought, or for the potential costs consequences of the commencement of the class 4 proceedings.

7 On 15 August 2006 the respondents' solicitors informed the Council's solicitors that a development application would be lodged. The application was lodged on 28 September 2006. The Council determined the application by the grant of development consent on 15 November 2006. The class 4 proceedings were adjourned on a number of occasions to enable the Council to assess and determine the development application. On 1 December 2006 the Council discontinued the class 4 proceedings.

8 On 7 December 2006 the Council's solicitors gave the respondents notice of the Council's intention to file the notice of motion for costs, including the standard warning that if the Council were successful in relation to the motion the Council would seek the costs of the motion. The Council's solicitors gave another warning to the respondents' solicitors about the notice of motion on 14 December 2006. The solicitors filed the notice of motion on 15 December 2006.

9 The respondents submit that the proceedings were commenced without notice in a "perfunctory and unreasonable manner", which amounted to disentitling conduct. Accordingly, the Council acted "so unreasonably that the other party should obtain the costs of the action" (Kiama Council v Grant (2006) 143 LGERA 441 at [78]). The Council submits that the proceedings were not commenced without notice in the traditional sense, as the notice of intent and the final order made the respondents well aware of the relevant issues. Moreover, there were a series of adjournments by consent after the development application had been lodged, which was a later date than the respondents had initially indicated. Given the long history of the dispute, the notice of intention, the service of the final order, the absence of any appeal against the final order, and that the Council as the responsible planning authority was acting in response to complaints received, its conduct could not be characterised as unreasonable and perfunctory. Further, the Council was almost certain to have succeeded if the matter had been fully tried.

10 Dealing with the last submission first, I do not accept that this was a matter in which the Council was almost certain to have succeeded. The matter involved legal and discretionary issues which preclude me from reaching any view that the Council was almost certain to have succeeded. For example, the respondents' consultant planner had made a detailed submission to the Council on 26 April arguing that a development application was unnecessary. From the evidence it appears that the Council did not respond to this detailed submission. The fact that the respondents lodged a development application once the proceedings had been commenced does not, in my view, amount to an admission that development consent was required. It may evidence only a decision to resolve the matter without incurring unnecessary costs, even if that meant lodging an unnecessary development application.

11 It seems to me the critical issue is that the class 4 application was filed without the Council, either itself or through its solicitors, giving any notice to the respondents of an intention to do so. The service of orders under s 121 B of the EPA Act does not fulfil the same function as a notice before action. The purpose of a notice before action is to inform respondents of the specific intention of a party to commence legal proceedings and, thereby, to give respondents an opportunity to take steps to avoid the need for that action and the associated costs.

12 In Melbourne University Publishing Ltd v Williamson [2005] FCA 1910 at [4] Heerey J said: It seems to me that it is more than speculation that had a letter of demand been sent the parties would have reached the common sense resolution that they have. In fact, it is a widespread and salutary practice in all forms of civil litigation for a prospective plaintiff to write a letter of demand, for the very reason that a prospective defendant can take advice and, if there is no defence, save the substantial costs that would be involved even for a brief undefended application like the present one.

13 In planning and environmental law there may be cases of true urgency that make it unnecessary or inappropriate for a notice before action to be given, but that was obviously not the case here. Notice before action was particularly important in the circumstances of this case, as the Council's real object was to obtain lodgement of a development application, the Council was aware that the respondents had engaged a consultant planner to deal with the matter on their behalf, the planner had made the detailed submission to which I have referred, and, apparently there was no response to this submission before the proceedings were commenced. The contrast between the lack of notice of the commencement of the substantive proceedings and the notice given on two occasions with respect to the motion for costs is stark. This notice highlights the importance of this aspect of standard civil litigation procedure- namely, to put the other party on notice of the claim to be made in order to give that party an opportunity to take steps to avoid the claim, without both parties unnecessarily incurring costs or taking up the time of the Court.

14 The respondents, on receiving the class 4 application, acted promptly to lodge the development application, presumably irrespective of the advice they had received from their consultant planner. This discloses that had the notice before action been given, there was a real possibility that the entire proceedings and their associated costs could have been avoided. The fact that the Council's solicitors did not give notice before action, in my view, denied the respondents this reasonable opportunity. In these circumstances and having regard to the broad discretion vested in the Court with respect to costs under s 69 of the Land and Environment Court Act 1979, I am satisfied that there should be no order for costs in favour of the Council.

15 I now must deal with the respondents' application for costs. Although I think this aspect of the matter is relatively finely balanced, in all of the circumstances to which I have referred above and to which Mr Kondilios has referred in his submissions, I am not satisfied that the commencement of the proceedings by the Council was so unreasonable that the respondents should obtain an order for costs in their favour. I think that the appropriate exercise of discretion in the substantive proceedings is that each party should pay its own costs of those proceedings. I consider the respondents' application for costs of the proceedings a defensive application that is often made in situations such as the present. I am satisfied the parties are before the Court today and prepared the various affidavits that have been read into evidence as a result of the Council's notice of motion for costs filed on 14 December.

16 I now turn to the costs of the Council's notice of motion. I am satisfied that the ordinarily principles should apply and that the respondents should be compensated for having had to come to Court to defend a costs application in respect of which the Council has been unsuccessful. In those circumstances I propose to make orders as follows. (1) The applicant's notice of motion filed 14 December 2006 is dismissed.

(2) The applicant is to pay the respondent's costs of the notice of motion as agreed or assessed.

(3) Otherwise each party is to pay its own costs of the proceedings. ****************************

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.

(2006) 143 LGERA 441

At a glance

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Judgment (27 paragraphs)

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Cited By (4)