Creak v Roads & Maritime Services; McKinley v Roads & Maritime Services

Supreme Court of NSW|2021-02-09|Before: Hoeben CJ

Solicitors: Adrian Holmes Law - Plaintiffs SW Legal - First Defendants File Number(s): 2020/16806; 2020/16815 Decision under appeal Court or tribunal: Local Court of NSW Date of Decision: 20 December 2019 Before: Baptie LCM File Number(s): 2018/273892; 2018/273902

JUDGMENT

HIS HONOUR: By Amended Summonses, dated 4 June 2020, the plaintiffs seek the following orders: "1 Leave to appeal from the part of the decision below in relation to costs delivered on 20 December 2019 (Costs Decision). 2 Appeal allowed. 3 The costs decision set aside. 4 The defendant to pay the plaintiff's costs of the proceedings below. 5 Further, or in the alternative, an order in the nature of certiorari quashing the costs decision together with an order pursuant to ss 69(3) of the Supreme Court Act 1970 (NSW) that the defendant pay the plaintiff's costs in the proceedings below. 6 The defendant pay the costs of these proceedings."

Procedural history

On 11 May 2018, the first defendant issued the plaintiffs with a "Notice to Show Cause". That notice was based on an audit of the plaintiffs' premises pursuant to the Authorised Inspection Scheme (AIS) on 8 February 2018. The notice alleged that the plaintiffs had violated the AIS Business Rules. The notice identified the rules and the conduct alleged to have violated them. The notice called upon the plaintiffs to "show cause" why their authority to operate as an authorised examiner should not be suspended or cancelled. The "Notice to Show Cause" document is set out as follows: An examiner must only issue inspection reports for the classes or types of vehicles permitted by their Examiner's Authority. 2.02 The Examiner is only authorised to inspect light vehicles under his Examiners Authority. However the Examiner has issued an inspection report for two (2) vehicles that should have been inspected by a Heavy Vehicle Authorised Examiner. Inspection report AP4618002 is a Ford F250 with a Gross Vehicle Mass of 4.536 tonne - a light vehicle examiner can only Inspect a vehicle that has a Gross Vehicle Mass of 4.5 tonne or less. Inspection report AP4345721 is for a Ford Transit bus which must be inspected by a Heavy Vehicle Authorised Inspection Station (HVAIS). It has 12 seats when any bus with 10 seats or more must have a HVAIS inspection. An examiner must not conduct an inspection unless they have access to the current AIS Rules for each class or type of vehicle in respect of which they issue Inspection reports. AIS Notices, Vehicle Inspector Bulletins, AUVIS Bulletins and related publications form part of the AIS Rules. The AIS Rules and other publications may be kept either in hard copy or electronically. 2.11 Electronic copies of AIS Rules and publications must be stored digitally 'on site' and accessible when AIS Online is not available via the internet. The Examiner conducted vehicle; inspections without access to the current AIS Rules. At the time of the audit, the Examiner did not have access to the current AIS Business Rules. An examiner must not have another person drive the vehicle for the purposes of an inspection or carry out a brake test on their behalf. 2.18 The Examiner allowed another person to carry out a brake test on the Examiner's behalf for the purposes of a vehicle inspection. On four (4) occasions the brake test associated with the inspection report has Examiner ID E02610 which is the Examiner ID for Gregory Charles McKinley. An examiner must, record all vehicle; identification; information required for completion of the inspection report directly from the vehicle. 2.20 The Examiner did not record all vehicle identification information required for completion of an inspection report directly from the vehicle. Manual Inspection report (duplicate copy) AF1849821 has no vehicle identity details. In the field for 'Registration details' is handwritten 'N/A'. 2.24 An examiner must conduct a brake test as part of the first inspection (where required), unless it is not safe to do so. Each brake test must be conducted prior to a 'pass' result and prior to the inspection report being issued. The Examiner did not conduct a brake test as part of the first inspection and prior to a 'pass' result being issued. On three (3) occasions the brake test time is after online 'Pass' submission. An examiner must following a brake test: • Ensure the minimum required speed for that class of vehicle has been achieved • Print an original and duplicate copy of the brake test print out 2.29 • Examine the brake test printout to ensure all device output information is correct and pass or fail result can be determined • Sign the original and duplicate copies of the brake test print out • Attach the original signed printout to the customer copy of the inspection report • Attach the duplicate signed printout to the AIS copy of the inspection report. Following a brake test, the Examiner did not follow the correct procedure for conducting a brake performance test in accordance with the AIS Rules by attaching duplicate signed printouts to AIS copies of inspection reports. An examiner must accurately record all details relating to the vehicle and the inspection in the appropriate fields on the inspection report and other forms. The Examiner did not accurately record the details of the vehicle and the inspection in the appropriate fields on the inspection report forms. 2.35 On four (4) manual inspection reports in the 'Inspection Checklist; section of the report, the Examiner has used a 'x' which is defined as meaning 'fail' yet the 'Result of the first inspection' is 'Passed Safe' on three (3) inspections however the fourth manual inspection report AF1849824 does not indicate passed or fail. On all four (4) manual Inspection reports In the field 'AIS Number' AIS number 'S00994' is present however the field 'Name and Address of inspection station' has been stamped with 'Pennant Hills Ford'. The name of the inspection station for the AIS number 'S00994' is C.A.R.S. Autohaus as per Roads and Maritime database records. An examiner must not make alterations to an inspection report once it has been signed or submitted electronically. 2.36 The Examiner made alterations to inspection reports after completing the original inspection report. In manual Inspection report AF1849821, which is a duplicate of the original inspection report, in the field for 'Registration details' is band-written In blue ink 'N/A'. An examiner must ensure any inspection reports or inspection report books they use in the course of inspection are stored in a secure location after use. 2.40 The Examiner did not ensure all inspection reports were securely stored after use. On 14 occasions the inspection reports are missing. The Examiner was provided with a list of the missing inspection reports and on 6/03/2018, the Examiner provided customer copies of the missing inspection reports but not the originals. None of the inspection reports were provided with brake tests attached. An examiner must sign the inspection report original and duplicate copies and each copy of the brake test printout in respect of each inspection they conduct. 2.42 The Examiner did not sign all copies of the inspection reports or brake tests on each inspect/on conducted. On two (2) occasions, the AIS copy of the inspection report has not been signed.

The plaintiffs responded to the notice.
On 16 August 2018, the first defendant issued the plaintiffs with a "Notice of Cancellation" of their AIS Examiner's Authority pursuant to clause 72 of the Road Transport (Vehicle Registration) Regulation 2017 (NSW) (the Regulation).
By application dated 6 September 2018, the plaintiff appealed the first defendant's decision to the Local Court of New South Wales pursuant to s 267 of the Road Transport Act 2013 (NSW) (Road Transport Act). This had the effect of staying the cancellation.
The appeal was commenced by application notice pursuant to s 45 of the Local Court Act 2007 (NSW) (Local Court Act).
The matter came before the Downing Centre Local Court and her Honour Baptie LCM heard the appeal on 5 March 2019, 10 May and 19 July 2019. On 6 September 2019, her Honour determined that all but one of the 10 alleged breaches had been established on the evidence presented. On 23 September 2019, her Honour received affidavit evidence and heard submissions on behalf of the plaintiffs and the first defendant.
The proceedings were adjourned to 1 November 2019. It is uncontroversial that the order of the Local Court in relation to the appeal was that the Local Court suspended Mr Creak's AIS Examiner's Authority for a period of 12 months and that of Mr McKinley for one month.
On 20 December 2019, the matter came before her Honour who, having received written submissions from the parties, determined that the plaintiffs should pay the first defendant's costs. A copy of her Honour's judgment on costs is attached to these reasons.

The legislation relevant to Local Court Appeal & Costs

The power to suspend or cancel an AIS Examiner's Authority is found in cl 72 of the Regulation. Under s 267 of the Road Transport Act a person may appeal to the Local Court against an "appealable decision" by filing a notice of appeal in the Local Court.
An "appealable decision" is defined in s 266(1)(l) of the Road Transport Act to include: "... any other decision under the road transport legislation made in relation to the person, or a vehicle of the person, that belongs to a class of decisions prescribed by the statutory rules for the purposes of this definition."
Pursuant to cl 127(a) of the Road Transport (General) Regulation 2013 (NSW), a decision of the Authority under the Regulation to cancel an examiner's authority is described as a decision of the kind identified in s 267(1)(l) of the Road Transport Act.
Section 268 of the Road Transport Act prescribes how the Local Court is to determine these "appealable decisions". It prescribes powers to set aside the decision, vary the decision, or dismiss the appeal, as well as to make any other order that the Court determines to be just in the circumstances.
An "appealable decision" is dealt with by the Local Court in its "Special Jurisdiction", which is found under Pt 4 of the Local Court Act.
Pursuant to s 45 of the Local Court Act, "appealable proceedings" may be commenced by issuing and filing an application notice in accordance with Pt 4, Div 2 of that Act. "Appealable Proceedings" are defined in s 43 as proceedings to which Pt 4 of the Local Court Act applies.
The magistrate's power to award costs pursuant to s 69 of the Local Court Act was discretionary. Section 69 is relevantly similar to s 98(1) of the Civil Procedure Act 2005 (NSW). It was accepted by the parties that as a general rule, the successful party is entitled to his or her costs.

The nature of the proceedings before the Court

By their Amended Summonses, the plaintiffs seek to appeal from her Honour's order that they pay the first defendant's costs and a review of her Honour's Costs decision, pursuant to the Court's supervisory jurisdiction under s 69 of the Supreme Court Act 1970 (NSW). Accordingly, the relief sought and the grounds stated in the plaintiffs' Amended Summonses are both an appeal in respect of the Costs decision and an application for review.
It was common ground between the parties that the Amended Summonses raises the following issues for resolution by the Supreme Court: 1. the plaintiffs' appeal against the decision of the Local Court to the Supreme Court pursuant to Crimes (Appeal and Review) Act 2001 (NSW) (plaintiffs' Amended Summonses generally); 2. was there an error of law and/or a jurisdictional error on the part of her Honour or appearing as an error on the face of the record in determining that the first defendant was the successful party (plaintiffs' Amended Summonses at [14]); and 3. was there an error of law and/or a jurisdictional error on the part of her Honour or appearing as an error of law on the face of the record in determining that the individual findings of fact as to the alleged breaches of the AIS Business Rules comprised the 'event' for the purposes of the Costs decision of 20 December 2019 (plaintiff's Amended Summonses at [16]).

Appeal to the Supreme Court - Crimes (Appeal and Review) Act 2001

It was also common ground between the parties that an appeal to the Supreme Court may only be made pursuant to s 70 of the Local Court Act in circumstances where the plaintiff in fact only appeals against the order for costs. Section 270 of the Road Transport Act with its privative clause is not applicable. Section 70(1) of the Local Court Act provides: "In relation to any order arising from an application notice: ... (c) an appeal to the Supreme Court may be made in accordance with Part 5 of the Crimes (Appeal and Review) Act 2001, in the same way as such an application or appeal may be made in relation to a conviction arising from a court attendance notice dealt with under Part 2 of Chapter 4 of the Criminal Procedure Act 1986."
There was no issue that her Honour's power to award costs was a power available to her pursuant to s 69 of the Local Court Act which provides: "(1) The Court may award costs in application proceedings at its discretion and may determine by whom, to whom and to what extent costs are to be paid in or in relation to application proceedings. (2) The Court may order costs to be assessed on the basis set out in the legal costs legislation (as defined in section 3A of the Legal Profession Uniform Law Application Act 2014) or on an indemnity basis. (3) This section is subject to this Act, the rules and any other Act."
This analysis was endorsed by Adamson J in Alpha Precision Pty Ltd v Comptroller-General of Customs [2018] NSWSC 841 where her Honour said: "8 It was common ground that Part 5 of the Crimes (Appeal and Review) Act 2001 (NSW) can apply to a decision of the Local Court to award costs in proceedings commenced in its Special Jurisdiction. This conclusion follows from the wording of s 70 of the Local Court Act. 9 Part 5 of the Crimes (Appeal and Review) Act relevantly provides for appeals as of right on a ground that involves a question of law alone (s 52) and appeals by leave on a ground that involves either a question of fact, or a question of mixed law and fact (s 53). Such appeals and applications for leave must be made as prescribed by the rules of court: ss 52(2) and 53(4). Appeals against interlocutory orders made by the Local Court in its Special Jurisdiction lie only on a question of law alone and only by leave. I am satisfied that the costs order made by Atkinson LCM was not an interlocutory order. Accordingly, any ground that raises a question of law may be appealed as of right and any ground that raises a question of fact or mixed law and fact requires leave."
The principles relevant to an award of costs were recently summarised by the Court of Appeal (Bell P, Gleeson and Payne JJA) in Sydney Local Health District v Macquarie International Health Clinic Pty Ltd (No 2) [2020] NSWCA 316 at [12] where their Honours said: "12 ... "Section 98 of the Civil Procedure Act 2005 (NSW) (CPA) relevantly provides that, subject to the Uniform Civil Procedure Rules 2005 (NSW) (UCPR), 'costs are in the discretion of the court' and the court has 'full power to determine by whom, to whom and to what extent costs are to be paid'. Rule 42.1 of the UCPR provides that, if the court makes any order as to costs, 'the court is to order that the costs follow the event unless it appears to the court that some other order should be made as to the whole or any part of the costs'. This rule reflects the well established principle that a successful litigant is entitled to an order for costs. However, 'the central and overriding principle is that of doing justice to the parties in each particular case'. Thus, the cases recognise that the 'event' is not confined to the final outcome of the proceedings; it can include the determination of individual issues litigated in the court of the proceedings. Depending on the circumstances of the case, a party may be entitled to his, her or its costs of an issue on which the party has succeeded. As Reynolds JA observed in Laguillo v Haden Engineering Pty Ltd [1978] NSWLR 306 at 308, '[a] principle of importance is that, as a general rule, a party is entitled to the costs of an issue on which he [, she or it] succeeds.' Where particular issues are 'clearly dominant or separable', then it may be appropriate to award costs in favour of the successful party on those issues. There may also be circumstances where it is appropriate to make orders depriving a successful party overall of his, her or its costs in respect of issues on which he, she or it failed. For example, in BHP Billiton Iron Ore P[t]y Ltd v National Competition Council (No 2) [2007] FCA 557 at [23], Middleton J observed: 'It seems appropriate when considering separate and distinct issues or inquiries, where there is no element of unreasonableness or inappropriate behaviour on behalf of the successful litigant, to consider appropriate case management principles, the relative merits or strengths of the lost issue or inquiry, whether the length of the proceedings had been greatly increased by the lost issue or inquiry on which the successful party failed, and whether the issue or inquiry on which the successful party failed otherwise was of sufficient significance in proportion to the whole case to warrant a special order to deprive that party of the costs of that issue.' The court may make an award of costs for and against each party on respective issues. Much will depend on the facts and circumstances of the case. Alternatively, the court may order a proportion of costs in favour of a party where numerous issues have been litigated and the successful party overall has not won every issue. In those circumstances, the court will apportion costs 'primarily as "a matter of impression and evaluation", rather than with arithmetical precision, having considered the importance of the matters upon which the parties have been successful or unsuccessful, the time occupied and the ambit of the submissions made, as well as any other relevant matter'. Given the reticence of the courts to apportion costs in a precise fashion, the Court can adopt a broad-brush approach to apportionment and is not required to tally each party's wins and losses in order to do so." (footnotes omitted).

Submissions on behalf of the plaintiffs

The plaintiffs submitted that at an early point in the proceedings (5 March 2019) they sought not only that the Cancellation Decision be set aside but that in the alternative, the Cancellation Decision be varied so as to impose a less severe penalty. The plaintiffs noted that that was the position which they maintained throughout the proceedings. The plaintiffs also noted that the first defendant opposed the grant of that alternative relief. The plaintiffs further noted that the Local Court ultimately made the order sought by them, i.e. that the Cancellation Decision be varied so as to impose a lesser penalty.
The plaintiffs submitted that as a result they had succeeded in obtaining the order sought by them, i.e. a variation with a lesser penalty. The plaintiffs submitted that had they not sought a variation in this way, the penalty imposed on them would not have been varied. The plaintiffs submitted that on that issue they were the successful party for the purpose of the costs proceedings.
The plaintiffs submitted that they had been successful in rebutting the Brake Testing Allegation and that this fact should have been taken into account by her Honour.
In the alternative, the plaintiffs submitted that jurisdictional error had been established by them in that the Local Court had misunderstood what was the 'event'. The plaintiffs submitted that this error was apparent on the face of the court record in that it was clear that the Local Court was labouring under a misconception as to the function it was called upon to perform in making an award of costs under s 69 of the Local Court Act.
The plaintiffs submitted that s 69 of the Local Court Act mirrored the Supreme Court's general power as to costs set out in s 98(1) of the Civil Procedure Act, i.e. costs are in the discretion of the Court and the Court has full power to determine by whom, to whom and to what extent, costs are to be paid. The plaintiffs submitted that it was well established that costs follow the event so that a successful party has a "reasonable expectation" of being awarded costs. On that issue, the plaintiffs relied upon the statement of principle by McHugh J in Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11, where his Honour said at [67]: "... the "usual order as to costs" embodies the important principle that, subject to certain limited exceptions, a successful party in litigation is entitled to an award of costs in its favour. The principle is grounded in reasons of fairness and policy and operates whether the successful party is the plaintiff or the defendant. Costs are not awarded to punish an unsuccessful party. The primary purpose of an award of costs is to indemnify the successful party. If the litigation had not been brought, or defended, by the unsuccessful party the successful party would not have incurred the expense which it did. As between the parties, fairness dictates that the unsuccessful party typically bears the liability for the costs of the unsuccessful litigation." (footnotes omitted)
The plaintiffs noted that the exception to that statement of principle arose when a successful party has been guilty of some sort of misconduct in relation to the conduct of the litigation.
The plaintiffs submitted that when those principles were applied to the facts of this case, it was clear that the first defendant was not the successful party and should not have been awarded costs on that basis. The plaintiffs submitted that that conclusion constituted an error of law on the face of the record.
The plaintiffs submitted that had they not commenced the proceedings, their Examiner's authority would have been cancelled permanently. Instead their Examiner's authority was suspended for respectively 12 months and one month. The plaintiffs submitted that the variation of the Cancellation Decision constituted an order made in their favour and established that the plaintiffs had obtained a successful outcome from the litigation.
The plaintiffs submitted that in focusing on her findings regarding individual breaches of the inspection rules, her Honour asked herself the wrong question, i.e. rather than evaluating which party was ultimately successful, her Honour assessed the extent to which each of the relevant breaches of the AIS Business Rules had been made out. The plaintiffs submitted that the court's focus on the individual breaches led it into error in the context of the Costs decision.
The plaintiffs submitted that this was not a case where the court recognised that they were the successful party, but nevertheless, decided to award costs against them because their conduct of the litigation unnecessarily protracted it. The plaintiffs submitted that the court below simply failed to correctly identify the successful party. They submitted that the imposition of a significant costs order on them being the parties who successfully obtained a variation of the first defendant's Cancellation Decision, had the potential to operate as a significance disincentive to parties seeking to exercise their appeal rights under the Local Court Act, thereby undermining the legislature's creation of that appeal avenue.
In reply, the plaintiffs submitted that apart from the Brake Testing Allegation, the show cause notice alleged that ten of the AIS Business Rules had been breached. The plaintiffs submitted that in eight cases the fact of the breach was accepted and submissions were made regarding the seriousness of the relevant breach and the circumstances surrounding it. In relation to two further AIS Business Rules subject to challenge, the plaintiffs submitted that a breach of the rules had not in fact been made out. These submissions were directed to the breach of AIS Business Rules said to have arisen from Mr Creak's inspection of a Ford F250 vehicle.

Submissions on behalf of the first defendant

The first defendant noted that the plaintiffs sought to both appeal from the decision of her Honour and a review of her Honour's decision. The first defendant submitted that for the appeal to succeed, it was necessary for the plaintiffs to demonstrate that her Honour's discretion miscarried or that the order of her Honour was plainly unjust or unreasonable. The first defendant submitted that the plaintiffs had failed to establish those matters.
The first defendant submitted that it was its success in establishing the breach of AIS Business Rules in particular ways which was of importance in the context of a legislative regime which was protective rather than punitive.
The first defendant agreed that it was of fundamental importance for her Honour to determine who in fact was the successful party in the proceedings. The first defendant submitted that it was clear from her Honour's Costs decision that her conclusion that the first defendant was successful was correct and was based on a principled approach to the facts.
The first defendant submitted that her Honour's decision that it was the successful party in the proceedings was based on the following considerations set out in the costs judgment: 1. the nature and number of breaches of Business Rules meant that the plaintiffs should either have their Testing Authority suspended or cancelled; 2. although the plaintiffs had avoided cancellation of their inspection powers, the orders actually made to suspend those rights were still adverse to and critical of them; 3. the decision of the first defendant to continue with the proceedings was justified by the adverse finding against the plaintiffs, i.e. that their inspection rights be suspended; 4. in relation to the appeals by the plaintiffs, only one breach in the Show Cause Notice was not established; 5. despite the plaintiffs acknowledging the breach of most of the Business Rules under consideration, no admissions were made by them in the proceedings; 6. her Honour noted that all the breaches being considered by the court were the subject of disputed evidence during the proceedings, despite the records of interview being signed by the plaintiffs; 7. the number and seriousness of the breaches involving Mr Creak were characterised by her Honour as "significant and concerning" involving as they did "his deliberate or reckless ignorance of the rules"; and 8. neither plaintiff was successful in having the proceedings brought against him by the first defendant set aside.
The first defendant submitted that it was erroneous to refer to the AIS Business Rules as involving penalties. It submitted that the correct characterisation of the legislation was that it was protective, having as its purpose the regulation of inspection activities to ensure the safety of the motoring public, and that compliance with relevant Business Rules was brought about by the imposition of sanctions.
The first defendant submitted that the proceedings before her Honour were in the nature of disciplinary proceedings in that they were protective of the public.
The first defendant submitted that the awarding of costs against the plaintiffs, even though they had successfully exercised their appeal rights, would not operate as a disincentive for other parties to rely upon the appeal provisions of the Local Court. This was because the legislative framework was directed at the regulation of inspection services which were designed to promote the safety of the motoring public.
The first defendant submitted that the rationale behind the approach contended for by the plaintiffs would have the inevitable effect that in all appeals, pursuant to s 267 of the Road Transport Act, there would be a prima facie entitlement to costs under s 69 of the Local Court Act where any order other than the dismissal of an appeal was made pursuant to s 268 of the Road Transport Act. The first defendant submitted that this would extend to decisions relating to the suspension of driving licences by police or the fining of persons exceeding the speed limit by 30-45 kmph.
The first defendant submitted that at no time did her Honour apply a test other than determining which party in her opinion was the successful party in the proceedings. Where the parties were at issue was not as to the nature of the question to be asked but as to how that question should be answered. The first defendant noted that in any event, the answer to that question was one of fact or mixed fact and law.

Consideration

As a preliminary issue I am of the opinion that there is no basis in this matter for the supervisory jurisdiction of the Supreme Court to be invoked pursuant to s 69 of the Supreme Court Act. The matters in contest as to costs could be and had been fully ventilated in the hearing of the appeal pursuant to the Crimes (Appeal and Review) Act.
In Kirk v Industrial Court of NSW (2010) 239 CLR 531; [2010] HCA 1 the majority of the High Court (French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ) noted at [71] that: "It is neither necessary, nor possible to attempt to mark the metes and bounds of jurisdictional error."
The High Court has been disinclined to authoritatively define error, however, some assistance on what may constitute such error is provided by Professor Mark Aronson (M Aronson, B Dyer, M Groves, Judicial Review of Administrative Action (4th ed, 2009) who catalogued eight categories of jurisdictional error which include: "... (5) Disregarding relevant considerations which the Act required to be considered or paying regard to irrelevant considerations, if the proper construction of the relevant Act is that such errors should result in invalidity. (6) Misconstruing the decision maker's act in such a way as to misconceive the nature of the function being performed or the decision maker's powers. ... (8) Breaching the hearing or bias rules of natural justice." These considerations have been described as involving "a constructive failure to exercise jurisdiction".
Some further assistance is provided in Area Concrete Pumping Pty Ltd v Inspector Barry Childs (WorkCover) (2012) 223 IR 86; [2012] NSWCA 208 where Basten JA said: "76 Because the term "jurisdiction" is of uncertain provenance, the phrase "jurisdictional error" fails helpfully to define potential causes of invalidity. The term suggests that a court has done something it is not entitled to do, or has refused to consider doing something it is entitled to do. Not only is the label imprecise; it is not supported by particular criteria which demonstrate when invalidity results. Indeed, the concept of invalidity itself must be used with caution; broadly it connotes not merely an incorrect exercise of a power, but a mistake as to its nature or existence. Jurisdictional error therefore includes agenda-setting mistakes that involve a failure to formulate correctly the issue to be determined and procedural mistakes, such as denying the unsuccessful party an opportunity to be heard. It will include a failure to exercise the power in good faith for the purposes for which it was conferred. Further, invalidity usually refers in this context to the absence of adverse legal consequences for the person directly affected and not to indirect effects on third parties. 77 In each case, it is necessary to determine, by reference to the relevant legislative purpose, whether it has been demonstrated that an established error was intended to spell invalidity. Simply to assert "jurisdictional error" will fail to identify how the principles of statutory interpretation should apply to a particular subject matter in a specific statutory context. The legal analysis underlying the applicants' contentions involves several steps, which need to be articulated." (Underlining added.)
I have concluded that the plaintiffs have not established any failure by her Honour to correctly formulate the issue to be determined in the context of the statutory provision in respect of which a determination was required.
The matters arising in these proceedings do not give rise to questions of jurisdiction, nor do they provide scope for supervision by this Court under s 69 of the Local Court Act. The question of who should pay costs, particularly in this case, is fact specific and essentially turns on factual findings by her Honour. Accordingly, I reject the submission that anything done by the learned Magistrate involved jurisdictional error or error on the face of the court record. In this case the court record would comprise documents initiating proceedings, pleadings, the formal court order and the reasons for the Costs decision. I do not understand the court record to include the submissions of the parties.
In relation to the appeal to this Court pursuant to the Crimes (Appeal and Review) Act, it should be noted that no appeal has been brought in relation to any of the factual findings made by her Honour. The only matter challenged is the order for costs and whether correct principles were applied by her Honour in reaching her conclusion as to costs. It follows that it was not open to the plaintiffs to challenge, in the course of submissions, the factual findings upon which her Honour's award of costs was based.
Given the findings of fact upon which her Honour's conclusion as to costs were based, I do not see any question of law arising so that the plaintiffs would have an appeal as of right to this Court. Accordingly, I have concluded that given the issues of fact found by her Honour in her judgment on costs, this is a matter involving questions of mixed fact and law in relation to which leave has to be granted before they can be considered.
Her Honour identified, as a crucial question to be decided, who was the successful party. Her Honour also found that all of the breaches established against the plaintiffs were the subject of disputed evidence during the proceedings. This included challenges to the records of interview of each plaintiff. There seems little doubt from her Honour's summary of evidence in her Costs judgment that the factual issues were hotly contested. The result is that even if no evidence was led in respect of a particular issue, it was still necessary for her Honour to be satisfied to the Brigenshaw standard (Brigenshaw v Brigenshaw (1938) 60 CLR 336; [1938] HCA 34) that the elements of that breach had been made out.
A fundamental issue in the appeal was the proposition put forward by the plaintiffs that because the cancellation of their inspection rights had been varied to a suspension, they had in fact improved their position and had achieved success in the proceedings and that this should be reflected in a costs order in their favour. That was certainly the position adopted by the plaintiffs in the appeal and to some extent not fully challenged by the first defendant. The resolution of that issue favourably to them was a fundamental part of the plaintiffs' appeal.
I find that submission difficult to understand. This is so given the clear statement by her Honour to the effect that the variation of the sanction to a suspension rather than a cancellation of inspection rights would still involve a finding and a result which were adverse to the position adopted by the plaintiffs. The observations to which I refer are as follows: "The respondent contends that: The fundamental decision was made that the appeal was varied and, therefore, the decision of the RMS is upheld, i.e. if the appeal was successful, there would be no suspension, period, at all". In addition, it was stated that: "If the appellants' appeals were successful, the orders made by the Court would have been to uphold each appeal with no suspension to be served." (Costs judgment p 2 line 1) and "The number and seriousness of the breaches involving Mr Creak are significant and concerning. The ongoing nature of his deliberate or reckless ignorance of the rules is very troubling. His history containing matters of a similar nature as recently as 2016 raise real concerns about his future compliance. The court has concerns as to whether Mr Creak is a fit and proper person to hold his examiner's authority." (Court judgment p 2 line 36)

Conclusion

The effect of her Honour's Costs decision is that having considered the whole of the circumstances and the whole of the evidence, her Honour was satisfied on the balance of probabilities that the first defendant was the successful party so as to entitle it to the costs of the proceedings. Implicitly, her Honour found that the first defendant acted appropriately in the proceedings, both in relation to commencing them and proceeding with them. Apart from the first defendant's failure to include the purported tampering with brakes in the Show Cause Notice, she was not otherwise critical of how the first defendant conducted the proceedings. That could not be said of her comments in relation to the plaintiffs. Those findings are plain from her Honour's reasons.
I have concluded that her Honour's reasons in her Costs decision were comprehensive and did not omit reference to any relevant matter. They were sufficient to expose her Honour's reasoning and recorded her findings which were made on the basis of evidence adduced at the hearing.
For the reasons already set out, none of the issues raised in the "supervisory" part of the claim is couched in terms of a legal question. The inclusion of the words "in law" and "jurisdictional error" do not for that reason give rise to questions of law.
What is raised in this application are questions of mixed fact and law in respect of which leave is required (s 53(1)(b) Criminal (Appeal and Review) Act). I am not persuaded that leave should be granted on any of those grounds. As indicated, it was in my view open to her Honour to find that the first defendant was successful in the proceedings which it brought against the plaintiffs. Given her factual findings, I have concluded that it was open to her Honour in the exercise of her discretion under s 69 of the Local Court Act to award costs to the first defendant. The principles relating to appellate review of discretionary decisions are well known. Before a court will on appeal interfere with a discretionary decision such as an order for costs, the applicant must demonstrate that the discretion miscarried or the order was plainly unjust or unreasonable. For the reasons given above, I consider that it was open to her Honour to approach the issue of costs in the way in which she did and no error of the necessary kind has been identified.
Since the plaintiffs have failed in their application, I can see no basis for not awarding the costs of this proceeding against them. There was no suggestion by the parties that costs ought not follow the event.

Orders

For the reasons given above, I make the following orders: 1. I refuse leave to the plaintiffs, Ian David Creak and Gregory Charles McKinley, to appeal against the costs order made by her Honour Baptie LCM on 20 December 2019. 2. I order the plaintiffs, Ian David Creak and Gregory Charles McKinley, to pay the first defendant's costs of the proceedings in this Court.

Cost Decision_2021_02_17_08_24_11_020 (78067, pdf) 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. Decision last updated: 19 February 2021

Road Transport (General) Regulation 2013(NSW)

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Judgment (13 paragraphs)

Legislation Cited (8)

Cases Cited (11)