Country Endeavours Pty Ltd v Baw Baw SC [2011] VCAT 2403 | Case summary

This is an application for orders for costs in favour of the respondent company Casicir Pty Ltd (Casicir) and Messrs Jeffrey and Curnow who are associated with it and also for the Responsible Authority. Orders for costs are sought against the applicant company, Country Endeavours Pty Ltd (Country Endeavours) and its associates namely Virginia Anne Giles, John David Giles and Shapher Pty Ltd (Shapher).
The proceeding concerned is an application for an enforcement order pursuant to section 114 of the Planning and Environment Act 1987 (PE Act). As its Tribunal number[1] indicates that proceeding commenced in 2009. After various difficulties and delays it was heard in November 2010 by this Tribunal constituted by myself sitting with Mr Ian Potts, Member. The hearing occupied five days from 22 to 26 November 2010. We gave our decision in a written document dated 7 February 2011. Our decision was to refuse to make an enforcement order and to reserve the question of costs. Our reasons for that determination were attached to that written determination. That document ran to 23 pages and our reasons contained 90 paragraphs.
This enforcement application is the culmination, or at least the culmination to date, of a series of proceedings brought to this Tribunal by Mrs Giles and or her associated company Country Endeavours.
These various proceedings arise in relation to a project of Casicir to reopen a dormant quarry at Lot 1 North Road, Neerim. The quarry site is immediately to the north of land in which Mrs Giles has an interest.
The evidence indicates that this land is owned by Shapher. It holds the land as part of the assets of the self-funded superannuation scheme of Mrs Giles and her husband John David Giles. It is let to Country Endeavours. Both these companies are companies of Mr and Mrs Giles. They are variously directors or secretaries of them.
To authorise the reopening of the quarry Casicir requires various permits and licenses. Amongst them it requires a planning permit. It applied to the Responsible Authority for the relevant permit. There were objectors. Mrs Giles and Country Endeavours were leaders amongst the objectors. The Responsible Authority determined to grant a permit. Mrs Giles and Country Endeavours were involved as applicants for review in proceedings under section 82 of the PE Act.
The resulting review hearing was conducted before this Tribunal over 12 days (Dr Sadler, who appeared for Country Endeavours and its associates in this current proceeding, at one point suggested 14 days). That hearing was during December 2008. The case was heard by two members other than Mr Potts or myself. It is obvious from the length and details of the reasons given by the Tribunal that this hearing was a very thorough one indeed during which a great number of matters, large and small, were considered in detail. Ultimately the Tribunal determined to refuse the application for review and to grant a permit subject to an elaborate set of permit conditions. The decision and directions of the Tribunal resulted in the issue, by the Responsible Authority, of planning permit number PLA0010/07 on 3 March 2009.
It is quite obvious from subsequent history, and subsequent proceedings, that Mrs Giles was bitterly disappointed with the result of her review before the Tribunal. She has not accepted the decision of the Tribunal to grant the permit and she has since instituted a series of proceedings aimed at reversing or frustrating the result. These subsequent proceedings may have had their ostensible purposes but when the whole series is reviewed in detail it emerges that, underlying any ostensible motives there has been this ulterior motive of reversing and frustrating the decision of the Tribunal in the initial case. This strategy has included attempts to recontest issues determined by the Tribunal. It has also included attempts to prevent, frustrate or at least delay Casicir in seeking to act on the permit granted to it.
Although I was not involved in the original Tribunal determination granting the planning permit, I have been involved in quite a number of hearings in several proceedings since the permit was granted. Over the last three years I have conducted, alone or with Mr Potts, quite a number of hearings (interlocutory and full hearings) and given many interim or final determinations in relation to these various subsequent proceedings. It can be noted that the citation name given to this present decision relating to costs is Country Endeavours Pty Ltd v Baw Baw SC (No.8). That tally may not include two determinations, in which the responsible authority was not involved. They concern applications under the Water Act[2]or in relation to the Water Act by Country Endeavours where the respondents were the West Gippsland Catchment Management Authority and Casicir, but which did not include the Responsible Authority. I fear that my count of the number of determinations or interim determinations may be astray, but it is obvious upon any review of them a great deal of time, trouble and expense has gone into the preparation, presentation and determination of these subsequent proceedings. They have imposed a burden on the resources of the Tribunal as well as the parties. I accept that Casicir has felt obliged to defend all these various proceedings and to incur considerable costs and trouble in doing so. Whilst I have not made a tally I suspect that the total number of hearing days devoted by the Tribunal to the initial hearing and subsequent hearings, would reach or exceed 20. Of course, this Tribunal exists to hear and determine the proceedings brought before it.
It is part of the policy of the legislation that the Tribunal should be able to determine such cases efficiently, promptly and economically, as well as fairly.
The normal rule before the Tribunal in relation to costs is found in section 109 of the Victorian Civil and Administrative Tribunal Act 1998 (VCAT Act). It provides that parties must bear their own costs except that the Tribunal can make and order that a party pay all or part of the costs of another party if it is satisfied that it is fair to do so have regard to various considerations set out in section 109(3). That is not the only provision relating to costs to be found in the VCAT Act or in the PE Act, but it is the basic rule. It has been accepted that part of the purpose of this is that parties should not be discouraged from bringing proceedings for fear of orders for costs being made against them, at any rate where they have behaved reasonably and responsibly.
This does not mean that parties or potential parties are free to abuse the process of the Tribunal or to act unreasonably or vexatiously in bringing or maintaining proceedings. In such circumstances orders for costs can be made and are made.
Mrs Giles has been well aware of these circumstances for a considerable period of time. For the purposes of considering this current costs application I have reviewed the various determinations (interim and final) given by the Tribunal in relation to Casicir's quarry proposal, and I have re-read the reasons that I have given in the determinations and interim determinations that I have made, including the determination of the enforcement application where I sat with Mr Potts.
The first matter I dealt with was an urgent application for a stop development order sought under section 93 of the PE Act. Before, during and in relation to that hearing Mrs Giles, who appeared in person on that occasion, was warned that those proceedings were a serious matter for Casicir and could well result in orders for costs against the requester. That application was unsuccessful and ultimately so was the request for permit cancellation to which it related.
It is not appropriate to recapitulate here the reasons given for the various determinations and interim determinations given since the permit was granted. The reasons were given in writing and stand as such.
This costs application, and these reasons, are not occasions to recontest the issues raised in the enforcement application and dealt with in our reasons given in our determination of 7 February 2011.
All the proceedings have been unsuccessful from the point of view of Mrs Giles and Country Endeavours. I consider it to be clear that some of them proved to be unwarranted and unjustified.
Section 75 of the VCAT Act makes provision for the summary dismissal of unjustified proceedings. It provides that the Tribunal may summarily dismiss or strike out all or part of any proceeding that it considers to be frivolous, vexatious, misconceived, lacking in substance or otherwise an abuse of process. That power can cut short a proceeding without it going to a full hearing with witnesses, evidence, submissions and the like. With that power of dismissal or striking out there is alsopower to make orders for costs, expenses lost, inconvenience and embarrassment caused by the proceeding. However, as I observed in my reasons in relation to an earlier determination, it is not always possible to determine at an early stage whether a proceeding suffers from such defects. It may only be possible to determine that the proceeding is, in fact, vexatious or frivolous, misconceived or lacking in substance or otherwise and abuse of process, after it has been heard.
In another place I notice that I agreed that the purpose for making orders for costs is intended to be compensatory rather than punitive, to compensate the loss rather than to punish wrongdoing. I agree with that.
Orders are only to be made where the Tribunal considers that it is fair to do so. If the ordering of costs in appropriate cases has the secondary effect of discouraging unwarranted proceedings, that is a by-product.
If some of the past proceedings ultimately proved to lack substance and to suffer other defects against which section 75 of the VCAT Act is directed to caution is still called for in relation to the enforcement application. Although other proceedings or applications in the series might ultimately have proved to lack substance, that circumstance is in no way conclusive that the same would be true of the enforcement application. Ultimately the enforcement application had to be heard on its merits before it could be determined on its merits.
Casicir, opposed the enforcement application from its inception. It has maintained that the application is unwarranted. It expressed concern at the time, trouble and expense it had been put to in relation to the proceedings brought and maintained by Mrs Giles and Country Endeavours. At an interlocutory stage in relation to the enforcement application it sought orders to protect itself in relation to the question of its costs. It applied for orders that Country Endeavours should provide security in relation to its costs, and that the enforcement application should not be allowed to proceed in the absence of such security.
That application was refused. However, a second application was made, at the same time, for the joinder of the legal owner of the Giles land namely Shapher and also for the joinder of Mr and Mrs Giles personally. It was clear that those joinders were a result of anxiety that, in the event of orders for costs being made against Country Endeavours, it would prove impossible to collect such costs. It was not clear that Country Endeavours in fact had any assets. It was in contemplation of the possibility of an order for costs that these associated entities were joined. It is obvious that Shapher, as owner of the land, has an interest in the land and any proceedings affecting it, that Mrs Giles was the prime motivator in all these proceedings and that she and her husband control both the companies. While it is true that Mr and Mrs Giles and Shapher resisted being joined as parties, it is also clear that they were joined as being interested and in contemplation that they might be subject to an order for costs, if one was to be made. There was no appeal against their being joined for that purpose.
I consider the various submissions made by Dr Sadler in relation to the costs applications made against his clients. In dealing with them in the following paragraphs I make no criticism of the advocate. He undertook a difficult task in a skilful and professional manner.
His clients resist the making of an order for costs against them on the basis that they were not voluntary parties and that they, at least in their own names, did not initiate the enforcement application. Whilst that may be true, I do not consider it to be a reason to refrain from making an order for costs against them in these circumstances. Casicir seeks an order for costs against them severally and jointly. I think that is appropriate in the circumstances.
Dr Sadler, on behalf of Country Endeavours and the associated entities, submitted that the question of costs in relation to the enforcement order should take no account of the other proceedings that have formed part of what amounts to be a campaign against Casicir, its quarry proposal, and its desire to act upon the planning permit granted to it by this Tribunal. It is perfectly true that the enforcement application is a separate proceeding from those others. It is appropriate to assess it on those terms. Nevertheless it does not follow that the other proceedings are altogether irrelevant. On the contrary, they, together with the enforcement proceedings, are part of a pattern of proceedings clearly designed to frustrate Casicir. Those proceedings, together with the enforcement proceeding, can be regarded as relevant. I have concluded that the enforcement application is a vexatious proceeding. That conclusion is reinforced where the proceeding emerges as part of a campaign of unwarranted proceedings aimed at what is an ulterior purpose so far as the enforcement application is concerned.
I have mentioned that section 109(3) contains various considerations to be taken into account by the Tribunal in assessing whether it is fair, in the circumstances, to make an order for costs against a party. The last of those considerations, (e) of sub-section (3), includes any other matter that the Tribunal considers relevant. I think that the other proceedings and their lack of merit, together with previous orders for costs, warnings explicit and implicit about bringing unwarranted proceedings and costs can be relevant matters. They are indicative of ulterior motivation. Proceedings brought for an ulterior purpose can be deemed vexatious.
Paragraph (a) of subsection (3) calls for attention as to whether a party has conducted a proceeding in a way that unnecessarily disadvantages another party. Various examples of possible ways of doing that are set out. These include conducting the proceeding vexatiously.
Dr Sadler submits that this relates to the conduct of the proceedings, rather than the nature of the proceeding. That seems to me to be a valid distinction. Furthermore, where conduct is held to have unreasonably disadvantaged another party, the costs relevant might only be those arising from that unnecessary disadvantage. That might not necessarily extend to the whole of costs of a particular proceeding.
In this case the initial enforcement application and supporting material certainly disadvantaged the other parties and, incidentally, the Tribunal. The application and supporting materials were so prolix, confusing and oppressive as to be unmanageable. I think I commented in one of the earlier sets of reasons that it is entirely unsatisfactory to present the Tribunal and the parties with a great volume of material and expect them to try and work through it to see if the applicant really has a case and what its nature might be. That is quite apart from the uncertainty as to whether such discernment might be erroneous.
However, Mr Peake on behalf of Casicir seeks an order that the proceedings as a whole are vexatious and that an order should be made for his clients' costs in relation to the whole of the proceedings.
Section 109(3)(c) specifies one of the considerations as the relative strength of the claims made by each of the parties, "including" whether a party has made a claim that has no tenable basis in fact or law. It is specifically relevant if claims have been made that have no tenable basis in fact or law, but that is not exhaustive of this consideration. The word "including" is used in the formulation in paragraph (c). In other words, the relative strengths of the claims are relevant. In this case the strength of the claims made in the enforcement order application have ultimately proved to be very weak, unjustified and or insufficiently investigated or understood to warrant the making or maintaining the application. In saying this I am well aware of what I said in Dennis Family Corporation Pty Ltd v Casey CC[3] in relation to what is "tenable" and "arguable" mean and what might be a weak case and yet not warrant the making of orders for costs.
I was referred, in the course of the hearing, to the formulation in relation to "vexatious" in the New South Wales case of Attorney General v Wentworth[4]. It has often been referred to Tribunal planning cases dealing with the notion of vexatious proceedings. The second proposition in the Wentworth case is that proceedings are vexatious if they are brought for collateral purposes. Dr Sadler agreed, in the course of the hearing, that proceedings brought for an ulterior motive could be regarded as vexatious. That is probably just another way of saying the same thing.
I am satisfied, in all the circumstances, that this enforcement application was brought for ulterior motives. It was not brought because there was some contravention of the planning permit or its conditions that was giving rise to a problem being suffered by Mrs Giles, Mr Giles or either of their companies; or by the public generally. Rather, I think it is clear, at least in retrospect, that the proceedings were brought for the ulterior purpose of frustrating Casicir and of frustrating the permit granted to it by the Tribunal and for the purpose of frustrating Casicir's attempts to act on that permit and to re-establish the quarry. The purposes I mentioned earlier in these reasons, including that one, but also to retry issues and to delay and defeat the quarry project.
Dr Sadler claimed that it was unfair to describe the proceeding as "fishing" as that is an expression used in relation to an exercise of commencing a proceeding for some reason and then going in search of justification for it after the event. In retrospect this application has the appearance of fishing with a broad casting net with reliance sought to be made on anything and everything dragged up thereby. The scope of the proceedings in concept and conduct was by no means limited to any real actual problem, public or private.
The fact that the Responsible Authority did not commence any enforcement proceedings should have been at least a warning to take care in initiating the proceedings. The Responsible Authority has a public duty under section 14 of the PE Act to enforce planning laws. That does not mean that this duty will always warrant an enforcement proceeding before the Tribunal. In this case not only did the Responsible Authority not commence proceedings, but it does not support the proceedings brought by Country Endeavours Pty Ltd. Indeed, it has characterised them throughout as unwarranted.
I say that this is a reason for caution although it is also true that on some occasions in the past proceedings have been brought by lay people[5] where the Responsible Authority has not commenced proceedings and where the applicants have been successful in obtaining interim enforcement orders and enforcement orders. In other cases the commencement of proceedings has prompted tardy responsible authorities to take action. Lack of support and opposition by a responsible authority is not necessarily a reason not to proceed. I say no more than that it is a reason to consider carefully whether proceedings are justified.
In relation to this application and this series of proceedings, other authorities, including expert authorities have been involved in relation to the administration of their responsibilities. In this connection I note the Department of Primary Industries and the West Gippsland Catchment Management Authority. These authorities have been satisfied with the conduct of Casicir and neither of them have supported this application, or the other proceedings. All this should have been additional reason for caution.
The first Wentworth proposition is that proceedings are vexatious if they are instituted with the intention of annoying or embarrassing the person against whom they are brought. These can be seen as two additional forms of ulterior motive or collateral purpose. I do not think I need to go into them for the purposes of this case.
There is no doubt that Mrs Giles has attempted, by the use of these and other proceedings to prevent or dissuade Casicir from proceeding with the reopening of the quarry. She has also harassed the Responsible Authority with the view to inducing support for her campaign in that respect. She has pursued that along with a further ulterior motive of seeking to induce Casicir to buy out her property and that of neighbours on what I take to be favourable terms. This is not to suggest that she would not be content with mere defeat of the project. However, the course of correspondence disclosed in relation to the enforcement application is aggressive to the point of being threatening. Dr Sadler submitted that is not illegal to offer to sell land on favourable terms to the seller. That, no doubt, is true. To seek to induce abandonment of a lawful project with the alternative of buying out property on favourable terms are purposes ulterior to the purposes to which the enforcement provisions are included in the PE Act.
All in all, I am satisfied that this application and its prosecution have been vexatious in the sense that they have been for ulterior purposes.
Dr Sadler referred to Stonnington CC v Blue Emporium Pty Ltd[6] and paragraphs 11 and 12 therefore. There is reference there to the primary focus in relation to costs being on matters arising since the commencement of proceedings. That must certainly be true in relation to the consideration of whether the proceeding has been conducted in a way so as to disadvantage others in terms of section 109(3)(a). However, it should be noted that the then President of the Tribunal did not there purport to say that relevance is limited to matters that have occurred since the commencement of proceedings. He only refers to the "primary" focus being "generally" on circumstances since commencement. In this present case it is alleged the whole proceeding has turned out to be vexatious and unwarranted. It makes relevant other actions before and beyond the commencement of the current proceedings.
Dr Sadler in paragraphs 15 of his written submissions, refers to a situation if a claim is "completely baseless". He was probably referring there to a phrase that appears in Wentworth. However, that is not the test in section 109(3)(c). As previously pointed out, that provision refers to relative strengths and does not call for something to be completely baseless. Furthermore, there are bases for finding that a proceeding is vexatious, quite apart from it being completely baseless.
Dr Sadler has sought to justify the proceedings, and justify the refusal of an order for costs, on the basis that some bits and pieces might have been "arguable". He suggested certain relevant things were not known to the applicant when the application was made, or did not become known until later stages. It is relevant, as Mr Peake[7] pointed out, that upon these things becoming known, the application in respect of them was not then abandoned.
In any event it is not just a matter of Mrs Giles pointing to possibilities and thereby calling upon the respondents to disprove them. Responsible conduct calls for sufficient investigation and refraining from commencing proceedings unless sufficient warrant exists. Claims that the applicant does not know things unless told are the smack of a reversal of the onus in this respect. I think the applicant has an onus as to whether proceedings should be commenced and maintained.
The fact that there may have been debate and some difficulties in interpreting and applying some conditions does not, of itself, necessarily justify the commencement of proceedings. For example, in relation to the conditions concerning noise, whatever they were meant to mean or however they were meant to be applied, the fact remains that the restrictive conditions of not exceeding 45 dBA in some circumstances, and 55 dBA in others, have been met. That is to say, they have been met so far as all the evidence is concerned, except for one reading of 57 dBA. In circumstances where a difference of 2 decibels is imperceptible the Tribunal rightly found this to be trifling and not warranting an enforcement order.
Dr Sadler referred to several matters in this guise. He would, no doubt, say that he was not seeking to re-argue the issues determined by Mr Potts and myself. He was trying to find a point or two that he could say were arguable. Nevertheless, taken as a whole, I am satisfied that this proceeding was not warranted, was misconceived in significant aspects and generally, lacks substance and was vexatious. It was unwarranted in the circumstances and should not have been brought. I consider that it is appropriate, both in relation to section 109 of the VCAT Act and section 150(4) of the PE Act to make orders for costs in favour of Casicir. Section 150(4) enables the Tribunal to make orders for costs and other remedies where proceedings have been brought vexatiously or frivolously.
I note, in this respect, that section 150(4) is not limited to orders by or against parties. In that respect it is like section 58 of the Planning Appeals Act and section 50 of the Administrative Appeals Tribunal Act which were the relevant provisions giving power to the Tribunal to make orders in relation to planning matters prior to the commencement of the VCAT Act. It can be noted that section 109 refers to parties. Section 150(4) and the previously applicable sections just mentioned were no so confined.
There was debate as to whether the Responsible Authority in this enforcement case was a "party", as opposed to a responsible authority with some interest and responsibilities in relation to the proceedings. It does not seek any costs in respect of work done by its officers, such as Mr McWhinney, the planning officer who appeared for the Responsible Authority on some occasions including the first morning of the hearing of the enforcement application. There is no doubt that the commencement of this proceeding, that I have found to be unwarranted, has occasioned the Responsible Authority trouble and expense, including the incurring of some legal costs. The Responsible Authority has sought an order for its costs. It was noted that it had denied that is was a party, and it did not participate in the full hearing.
Dr Sadler suggested that it would be unfair to make an order against his clients in favour of the Responsible Authority where it denied that it was a party. I think the restriction of orders to parties, that appears to apply to section 109 of the VCAT Act does not apply to section 150(4) of the PE Act. In those circumstances I do not think that there is a legal inhibition on making an order in favour of the Responsible Authority. It is rather a question of whether it is fair to do so in these circumstances.
These proceedings, that I have found to be unwarranted and to that extent an abuse of process, have occasioned trouble and expense to the Responsible Authority. The Responsible Authority has sought to minimise its participation in the proceeding, and thus its expenses. Nevertheless it has been obliged to undertake some work and to incur some legal expenses. I am faced with the question as to whether it, and thus its ratepayers, should bear this expense, or whether it is fair to make an order against Country Endeavours and its associates. I consider that it is appropriate to make an order in favour of the Responsible Authority.
It is true that the Responsible Authority has not itemised or quantified the costs that it seeks. In the circumstances I am not in a position to fix a sum for those costs. Rather, unless costs are agreed between the parties, it would appear necessary for the Responsible Authority to itemise and quantify its legal costs of and in relation to this proceeding and, if necessary, to have those costs taxed by the Costs Court.
It was common ground before me that until recently the appropriate scale of costs would be the old County Court Scale "D". I am aware that a new single County Court Scale has come into operation, but all the work and expense for which costs are claimed, save for the costs hearing on 13 December 2011, was incurred prior to the operation of this new scale.
Such costs should be on a party versus party basis.
Casicir seeks and order for its costs jointly and severally against Country Endeavours and its associated parties included 50% of counsel's fees for the practice day hearing on 12 February 2010, costs of the mediation conducted on 30 August 2010, costs of the preliminary hearing held on 8 September 2010, costs of further mediation on 23 September 2010, costs of the full hearing and costs of the application for an order for costs. I consider this appropriate.
I am asked to certify counsel's fees on a daily basis and on the basis of $6,600 per day and $660 per hour with half the daily fee for the various directions and preliminary hearings and mediation hearings.
I recognise that this case is a matter of importance to Casicir and I also consider that it is reasonable for it to have engaged relatively senior counsel experienced in this field. However, I am not prepared to certify for the rates suggested, although, in the circumstances, I think something more than the scale fees for counsel is warranted. I propose to certify for figures at one-half of those suggested on behalf of Casicir.

Country Endeavours Pty Ltd v Baw Baw SC

At a glance

Court

Decision date

Source

Judgment (17 paragraphs)

Country Endeavours Pty Ltd v Baw Baw SC (No.8) [2011] VCAT 2403 (29 December 2011)

Parties

Cases Cited (1)