Endicott v Esther

Land and Environment Court (NSW)|2015-11-05|Before: Preston J

Judgment

The respondent seeks its costs of proceedings under the Trees (Dispute Between Neighbours) Act 2006 ('Trees Act') commenced by the applicant concerning trees located on the respondent's property. Those proceedings were heard at an onsite hearing conducted by Acting Commissioner Galwey on 28 July 2015, following which the Acting Commissioner dismissed the application. By a notice of motion filed on 28 August 2015, the respondent now seeks an order that the applicant pay the respondent's costs of defending the application. The notice of motion initially sought orders for the payment of indemnity costs for a certain period, but the order for indemnity costs is no longer sought.
The notice of motion is supported by the affidavit of Mr John Comino dated 27 August 2015, and in its application the respondent also relies on affidavits filed by her in the proceedings. Mr Endicott, the applicant, has also filed an affidavit concerning the question of costs.
The exercise of the Court's discretion to award costs is subject to the provisions of rule 3.7 of the Land and Environment Court Rules 2007. This provides, at r 3.7(2) that "The Court is not to make an order for the payment of costs unless the Court considers that the making of an order as to the whole or any part of the costs is fair and reasonable in the circumstances." In r 3.7(3), the rule sets out some of the circumstances in which the Court might consider it reasonable to award costs. These circumstances reflect the principles set out by Justice Preston, Chief Judge of the Court, in Grant v Kiama Municipal Council [2006] NSWLEC 70. A number of the circumstances described in r 3.7(3) are relied on by the respondent in their submissions on this application.

History of the Proceedings

In considering all of the facts and circumstances, it is helpful to have regard to the history of the proceedings. The trees the subject of the application are located on the respondent's property directly behind a fence that runs along the applicant's driveway. It is clear from the evidence that the trees have been a source of contention between the applicant and the respondent for some time. The applicant had concerns about the leaves of the trees staining the driveway, the leaves accumulating on the driveway, and the inability to park cars on or walk along the driveway as a result of the trees. On the respondent's evidence, she regularly pruned the trees at a frequency of twice yearly. On the applicant's evidence, this pruning was only done when he informed her of overhanging branches.
The application under the Trees Act was lodged on 24 April 2015. The application sought orders under both Part 2 and Part 2A of the Trees Act. Part 2 allows the Court to make orders regarding trees that have or are likely to cause damage to property or injury to a person. Part 2A allows the Court to make orders regarding hedges that either obstruct views or prevent access to sunlight.
Following the filing of the application, the history of the proceedings can be summarised as follows:

In early May 2015 the respondent sought to prune the trees. Some of the pruning of overhanging branches was done on 4 May 2015 before the applicant on the following day indicated his refusal to allow further access to the respondent for further pruning of the trees.
Following this, on 10 May 2015 the respondent was able to have someone remove the overhanging branches by reaching over from the respondent's side of the fence.
On 16 June 2015 the first directions hearing of the proceedings was held. The applicant was given leave to rely on amended tree dispute claim details. On the evidence of Mr Comino, some deficiencies regarding the orders sought in the Tree Dispute Application were also pointed out to the applicant at that directions hearing.
On 22 June 2015, the respondent's solicitor wrote a letter to the applicant with an offer to settle the proceedings. The offer enclosed proposed consent orders, which included a number of orders for the ongoing maintenance of the trees as well as an order requiring the applicant to pay the respondent's costs in the sum of $2600.
The proceedings came back before the Court for a second directions hearing on 23 June 2015, at which time the issue of the applicant failing to specify the orders sought was again raised. The applicant also advised the respondent at this time that whilst he accepted some of the terms of the consent orders, he do not consent to the order requiring the payment of costs. The application was listed for hearing on 28 July 2015.
On 29 June 2015 the respondent filed a document entitled 'Further Proposed Orders.' This included orders under both Part 2 and Part 2A of the Trees Act, and to some extent they were taken from the consent orders proposed by the respondent to resolve the proceedings.
On 1 July 2015 the respondent wrote a further letter to the applicant again containing the same offer of settlement as that contained in its letter of 22 June 2015. The applicant responded to the respondent's letter by indicating that whilst he would agree to the orders regarding the ongoing maintenance of the tree, he would not agree to pay the applicant's costs.
On 9 July 2015 the respondent filed three lay affidavits in support of her defence of the application.

The matter then proceeded to an onsite hearing on 28 July 2015, at which time the applicant indicated that he no longer pursued his application under Part 2A of the Trees Act concerning the obstruction of views or loss of access to sunlight. In order to save on legal costs, the respondent's solicitor did not attend the hearing. Following the hearing, the application under Part 2 of the Trees Act was dismissed by the Acting Commissioner in Endicott v Esther [2015] NSWLEC 1290.
In his judgment, the Acting Commissioner says (at [3]-[4]): (3) Before making orders the Court must be satisfied that the trees concerned have caused, are causing, or are likely in the near future to cause, damage to Mr Endicott's property, or are likely to cause injury to any person. (4) Trees 1-5, including the Buddleja, are approximately 3 metres tall. Mr Endicott says they were 4.5 m tall prior to pruning. The Camellias, Trees 6-10, are 1.5 metres tall. Photos show that some branches of Trees 1-5 were overhanging the boundary prior to pruning carried out by Mrs Esther earlier this year.
The Acting Commissioner then discusses the options available to Mr Endicott to resolve future issues arising regarding overhanging branches. Following this, he finds (at [10]): (10) At the time of the hearing there were no branches overhanging Mr Endicott's side of the common boundary. There is no evidence that vehicles have been scratched. I find it unlikely that branches will scratch vehicles in the near future, or cause injury. Even if I am wrong on this, as I have described above there are practical steps that Mr Endicott can take to remedy such a problem should it develop. Therefore I see no reason for the Court to make orders to deal with this issue.

Submissions

The respondent submits that, in accordance with r 3.7(3)(c), (d) and (f), it is fair and reasonable for the applicant to pay the respondent's costs of the proceedings. These provide as follows: (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, or maintained a defence to the proceedings, where: (i) the claim or defence (as appropriate) did not have reasonable prospects of success, or (ii) to commence or continue the claim, or to maintain the defence, was otherwise unreasonable.
The applicant also relies on the principles outlined in Grant v Kiama Municipal Council, however these principles are reflected in the terms of rule 3.7 and need not be separately considered.
The respondent submits that, in accordance with r 3.7(3)(c), the applicant engaged in 'continuous harassment' that prevented the respondent from carrying out pruning twice yearly as she deposes to have been doing since 2012. In light of this, the respondent says that the applicant acted unreasonably in circumstances leading up to the commencement of the proceedings.
The respondent also submits that in accordance with r 3.7(3)(d), it was unreasonable for the applicant to commence the proceedings in circumstances where the respondent pruned the branches twice yearly, and had failed to do so only because of the behaviour of the applicant. The respondent also says that the applicant acted unreasonably in refusing access to his property to allow the respondent to prune the branches on 5 May 2015, after the proceedings had commenced. The respondent says that the unusual lengths that she went to by having a friend prune the trees by standing on the colour bond fence demonstrates that she always had the intention of regularly pruning the trees.
The respondent also says that the applicant unreasonably put the respondent to the cost of defending the proceedings as a result of deficiencies in the Tree Dispute Application form as filed by the applicant. The deficiencies relate mainly to the failure of the applicant to sufficiently specify the orders sought, and the inclusion of orders under Part 2A of the Trees Act in circumstances where the Court had no jurisdiction to make orders (the hedge being less than 2.5 metres in height).
The respondent also submits that the applicant unnecessarily continued the proceedings where he should have been aware that he had no prospects of success. To that end, the respondent says that the applicant should have been aware that the trees did not meet the jurisdictional test arising in Part 2A of the Trees Act and that he was required to specify the orders sought. Further, the respondent submits that the applicant should have obtained legal advice on the offer of compromise and as a result of his failure to do so the proceedings continued unnecessarily to a hearing.
Conversely, the applicant's submissions largely relate to his assertion that he felt there was no other way to proceed other than to commence the proceedings under the Trees Act. He submits that the proceedings were commenced because the respondent had created what he describes as a "jungle" and he was unable to resolve the problem with the respondent directly. He found that commencing the application was cost effective, and whilst he was unhappy with the outcome of the proceedings, the applicant says that he wanted the opportunity for the Court to see the trees and consider what should be done. The applicant submits that the respondent's decision to engage a solicitor caused unnecessary complications and that the cost of that decision should be borne by the respondent.
The applicant also submits that he couldn't accept the offer of settlement because he considered it unreasonable to accept that he should pay the applicant's legal costs. He therefore submits that the proceedings were continued by reason of the actions of the respondent's solicitor in requiring him to pay costs if he chose to settle the proceedings.

Consideration

Whilst it was unreasonable for the applicant to prevent access to his property to allow the respondent to solve the very problem that caused him to commence the proceedings, there are a number of factors that cause me to form the view that it is not fair and reasonable in the circumstances for the respondent to benefit from a costs order in her favour.
Firstly, the commencement of the proceedings prompted action by the respondent that did in fact remove the immediate problem that was presented by the trees. Albeit that this action suffered a setback by the applicant's refusal to allow access, ultimately the respondent was able to creatively achieve the pruning back of the trees to stop them overhanging the applicant's property. As a result, although orders were not ultimately made in favour of the applicant, the applicant obtained a functional outcome that may not have been achieved had the applicant not commenced the proceedings. Whilst Ms Esther has deposed of pruning the branches twice yearly, there is no evidence of her attempts to prune the branches in the months prior to the commencement of the proceedings or of any requests by her to access the applicant's land for that purpose. Whilst it was submitted that she was unable to do so because of the applicant's conduct, there is no evidence of her attempts to do so and there is a scarcity of evidence in relation to the precise conduct of the applicant prior to the commencement of the proceedings that prevented her from so attempting.
Secondly, following the resolution of the immediate problem in this manner, the applicant was not given an opportunity to discontinue the proceedings on reasonable terms. The respondent's offer to settle the proceedings included orders for the ongoing maintenance of the tree by the respondent, as well as a term for the payment of part of the respondent's costs by the applicant, in the sum of $2600. In proceedings under the Trees Act, in which orders for costs are not generally made and where the process is designed to be simple and inexpensive, the inclusion of the order for costs in the offer of settlement made prior to the matter being fixed for hearing was not reasonable. Further, even if the applicant had accepted the terms of the consent orders, a hearing on whether the orders for ongoing maintenance were appropriate may have nonetheless been required.
It is quite unreasonable, in my view, for a respondent to remove the immediate problem that caused the institution of the proceedings and then make an offer of settlement that includes a requirement for the payment of their legal costs thus far, either in part or in full, where the evidence had not yet been filed. Following the allocation of the hearing date, the same offer was made without any change to the term requiring the payment of costs. There was no invitation to discontinue with no order as to costs, nor was there any indication that the applicant might have known that it was open to him to seek leave to discontinue the proceedings. The only option to the applicant was to continue the proceedings. In light of this, it cannot therefore be said that the applicant was unreasonable in continuing the proceedings. I therefore accept the submission made by the applicant that it was the terms of the offer of settlement made to him that caused the proceedings to continue.
The deficiencies in the Tree Dispute Application form, in my view, do not form a sufficient basis on which it could be said that the applicant acted unreasonably in the conduct of the proceedings. The applicant represented himself and I accept that he filled out the application as best he could, copying the information available online to complete the orders sought section. Once the orders were adequately specified, they included an order that was clearly outside the Court's jurisdiction (for reimbursement for the leaf blower), but notwithstanding this I do not accept that the inclusion of such orders or his failure to specify the orders sought in sufficient detail earlier in the proceedings meant that the applicant acted so unreasonably in the conduct of the proceedings that it put the respondent to unnecessary cost. Similarly, I do not accept that the applicant's inclusion of claims under Part 2A of the Trees Act and his subsequent withdrawal of those claims is sufficient conduct to warrant the making of a costs order against him - the application nonetheless went to a hearing on the question of whether orders could be made under Part 2 of the Trees Act.
There is some merit in the applicant's submission that the proceedings became unnecessarily complex because of the involvement of the respondent's solicitor. It is difficult to ascertain what value the respondent's solicitor added to a process in which it was clear that the branches that caused the proceedings to be commenced had been removed early in the proceedings. It is well established that applications under the Trees Act are intended to be inexpensive and simple. There is a large volume of material online to assist both applicants and respondents in these applications. There is nothing before me that suggests that the respondent obtained a better outcome because of the involvement of her solicitor. However, my decision does not turn on this issue and I am not of the view that this question needs to be considered in my determination of the present costs application.
Similarly, the question of whether the applicant would have been unsuccessful in his application even if the branches had not been pruned is not required to be considered in determining this costs application. The fact is that the branches had been pruned by the time of the hearing and following this the respondent had not given the applicant the opportunity to discontinue the proceedings on reasonable terms. In those circumstances, I am not satisfied that it is fair and reasonable for a costs order to be made. I make the following orders: 1. The notice of motion filed on 28 August 2015 is dismissed. 2. Each party pay their own costs of the proceedings and of the notice of motion filed on 28 August 2015. Joanne Gray Registrar of the Court

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: 18 November 2015

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