Ervin Mahrer and Partners v Strathfield Municipal Council

This is a Motion brought by the Council filed on 24 August this year, to vacate fixed hearing dates for Class 1 proceedings which were fixed by the Registrar of the Court on 22 August 2001 for the 10th, 11th, 12th, 13th, 14th and 17 December 2001.

Additionally the Motion seeks an order that the proceedings be not granted a further hearing until the Court of Appeal proceedings in the matter are fully disposed of. In effect, the Council seeks a stay of the proceedings generally or more particularly of my interlocutory judgment delivered on 29 June 2001.

The Motion is supported by an affidavit sworn by Mr Turvey To, an employed Solicitor acting for the Council in the proceedings which sets out the relevant history of the matter (involving the present proceedings in the Court by way of appeal against the Council's deemed refusal of a development application lodged with the Council in October 1999 to carry out a major development at Homebush) including a resume of matters occurring after my judgment given on 29 June 2001 in interlocutory proceedings whereby I granted leave to the Applicant to rely on amended plans at the hearing of the Applicant's pending appeal (which at that stage had not been fixed for hearing).

It was when the matter was returned to the Registrar following that decision that the fresh hearing dates in December were fixed. In my judgment delivered on 29 June 2001 I upheld a Notice of Motion brought by the Applicant seeking leave to rely upon amended plans in substitution for original plans and at the same time, dismissed the Council's competing Motion which had sought a declaration that the development depicted in the amended plans was not substantially the same development as the development that had been depicted in the original plans, with a consequential claim to a declaration that the Court had no jurisdiction to grant leave as sought in the Applicant's Motion.

In upholding the Applicant's Motion, I made Order 3 which was in these terms:

Leave is granted to the Applicant to rely upon the amended plans referred to in its Notice of Motion upon the following terms: (i) The Applicant shall serve upon the council within 14 days the following additional documents to support the amended development application, (a) shadow diagrams, (b) landscape plans, (c) amended Statement of Environmental Effects; (ii) The Applicant shall notify in writing, within 14 days, the Council and the Court of its election between the original plans and the amended plans upon which is proposes to proceed; and (iii) The Applicant shall pay the Council the sum of $5,000 as compensation for the Council's consideration of the amended plans, together with a sum sufficient to defray the cost incurred in the public notification pursuant to The Environmental Planning and Assessment Regulation 2000 of the amended development application.

Following those orders, the Applicant's Solicitors by letter dated 13 July 2001 addressed to the Council's Solicitors, forwarded the shadow diagrams, the landscape plan and the amended Statement of Environmental Effects as required by term 1 of Order 3. Additionally the Council was formally notified of the Applicant's election to rely upon the amended plans rather than the original plans. This advice complied with term 2 of Order 3. Finally the letter enclosed a cheque in favour of the Council in the sum of $5,830 comprising the $5,000 compensation ordered by the Court in favour of the Council's consideration of the amended plans, together with the $830 being the prescribed advertising fee for the re-advertising of the amended plans as required by term 3 of Order 3.

Accordingly, all the terms of the leave granted by the Court in Order 3, having been satisfied by the Applicant, the Applicant thereupon pursuant to the decision on 29 June 2001, was entitled to rely upon the amended plans on the hearing of the appeal.

According to Mr To's affidavit, the Council on 24 July this 2001, filed in the Court of Appeal a holding summons for leave to appeal against my interlocutory judgment, and on 5 September 2001, Council's Solicitors filed an ordinary summons and a draft Notice of Appeal and a summary of argument seeking leave to appeal against my judgment of 29 June 2001. In par 15 of his affidavit, Mr To deposes to being informed by the Court of Appeal Registry that an application for leave to appeal is likely to be heard no sooner than six months from the date of filing the application for leave to appeal, depending upon the party's ability to prepare documents. As I have noted the Notice of Appeal and its appropriate summons was filed on 5 September 2001, meaning, according to Mr To's evidence, that the Court of Appeal is unlikely to hear the application for leave to appeal before March 2002. It is in these circumstances, that Mr To, in pars 12, 13 and 14 of his affidavit provides estimates of the costs likely to be incurred by the Council in the six day hearing of the Applicant's pending development appeal fixed for December 2001and expresses some opinion as to the Council's ability to absorb costs thrown away, in the event of its application for leave to appeal to the Court of Appeal being granted and the appeal being upheld (whenever that matter may be heard by the Court of Appeal, apparently next year). Mr To goes on to say that in par 14, that even if the Council were to obtain a costs order in relation to costs thrown away, the timing of recovery of such a costs order would be likely to involve lost opportunities for the Council in the retaining of access to legal advice in other cases that it might be involved in.

It is apparent that the sole basis for the Council's Motion for a stay of the proceedings is founded upon the prospect of the Council having to incur costs estimated at between $60,000 to $100,000 by Mr To, in his affidavit in conducting its case in the present proceedings in December 2001, if subsequently when the Court of Appeal hears the application for leave to appeal (on the evidence at some time after March next year) the Council were to be successful in that application with the consequence of the appeal being allowed, in all probability at a time well and truly after the disposal of the class 1 proceedings in this Court on the assumption that the hearing is conducted as fixed in December 2001, and a decision is given within a reasonable time of the conclusion of that hearing.

In opposing the application for stay, the Applicant had advanced a formidable argument both oral and in writing, which in my respectful opinion persuasively and totally answers the case sought to be made by the Council for the stay. There is, I am bound to say, an increasing air of unreality about this whole proceeding, which has already been before the Court on a number of interlocutory occasions, which proceeding is founded on the appeal made to the Court in February 2000 in respect of the Council's failure to determine a development application made to it in October 1999. The fact that the hearing of such an appeal is fixed for December 2001 - more than two years after the lodging of the development application with the Council and nearly two years after the lodging of an appeal with the Court, is most exceptional when measured by any reference to the normal standards attested by this Court's practices, and its ability to discharge its business efficiently and promptly.

A number of interlocutory judgments have explained how this unusual state of affairs has come about, and I will not rehearse the matter, save to say that in large measure it has hitherto been caused by the Applicant's desire to amend the development proposal from that originally propounded, where such amendments have apparently been inspired by the Applicant's desire to overcome Council's particular objections to the proposed development. It is to be noted that the successive amendments have to this end been unavailing.

But whatever may be said of matters past, the prospect of staying the hearing of an appeal already considerably delayed to a date beyond March 2002, simply to await the outcome of an application for leave to appeal to the Court of Appeal against an interlocutory judgment given solely on a matter of practice and procedure (no matter how important the matter of practice and procedure be thought to be by the Council) is in my view, an extraordinary state of affairs and one that is totally unsatisfactory from the point of view of the Court's commitment to promptly and efficiently discharge its business.

Moreover, any question of prejudice to the Council in having to incur costs in the conduct of the litigation fixed for December of this year has to be measured against the question of prejudice to the Applicant being stalled in this Court from obtaining a hearing of its appeal, on the substantive merits. For the reasons which I have adumbrated, the chronology of the litigation history in this Court, is one which has involved exceptional delays and they should not be extended indefinitely or otherwise exacerbated unless there are good and cogent reasons for so doing.

As I have mentioned, the sole basis for the Council's application for a stay of proceedings is the risk of costs being incurred, which are ultimately wasted in the event of the Council's leave to appeal application being upheld by the Court of Appeal at a time (in all probability) well after the decision of the Court (if the fixed hearing dates in December are not vacated).

There has been some debate in the argument as to whether, looking at the matter in the most favourable light to the Council (that is assuming its total success in the Court of Appeal) whether the Council will be compensated for costs thrown away by that successful appeal in relation to the costs incurred in this Court in the planning appeal. As I pointed out in the course of the argument there are two possible scenarios which will face the Court of Appeal when it comes to deal, apparently post March 2002, with the Council's application for leave to appeal. In the event of the hearing dates fixed for the hearing of the appeal in this Court of the development appeal being maintained for December of this year, the result will be that either the appeal will have been successful in this Court or the appeal will have failed. If the appeal has failed, and the Council still pursues its application for leave to appeal, there must be considerable doubt as to whether the Court of Appeal would have the power to order costs in relation to those class 1 proceedings.

Conversely, if the appeal to this Court is upheld following the hearing in December of this year and the Council's application for leave to appeal to the Court of Appeal is successful, then that success, to be meaningful in an overall sense in the litigation, would need to be translated into appropriate orders made by the Court of Appeal dealing with the decision of the Court in upholding the planning appeal. Whether that matter falls within the reach of the Court of Appeal in the application for leave to appeal and the resulting appeal or whether it would fall within the reach of the Court of Appeal pursuant to its prerogative jurisdiction, I need not pause to consider, other than to say that in such a scenario it would appear that the Court of Appeal, would possess power to make a costs order in relation to both costs in that appeal and in the Court below (including any costs thrown away that were incurred in the planning appeal).

In the course of his comprehensive written submissions, Mr Ireland, on behalf of the Applicant, has helpfully drawn attention to the relevant authorities, dealing with the Court's powers to order stays (including the power conferred by the Land and Environment Court Act 1979, s 59(1) which would apply to my interlocutory judgment) and the discretionary considerations that are relevant to determining an application for a stay, the gist of which submissions I would generally adopt.

The present case is somewhat unusual in as much as the Council is seeking to stay the whole of the proceedings on the basis of its grievance with an interlocutory decision on a matter of practice and procedure. There has been no judgment on the substantive case in this Court and the Council's stay application that would have the effect which I have earlier mentioned, of further delaying the processes for a hearing on the substantive merits of the Applicant's development appeal which proceedings will have been in this Court for nearly two years, come December 2001. It would be an unusual case indeed for proceedings generally to be stayed on the basis of a legal grievance with an interlocutory judgment.

Weighing the prejudice that might be suffered by the Council (only expressed in terms of costs) including the prospects of its reparation by an appropriate costs order, against the prejudice likely to be suffered by the Applicant in having its case further delayed, by what appears to me to be an inordinate additional delay factor, leads me to conclude that the Council's case based upon prejudice is not compelling and in the balancing scales it is certainly weaker and lighter than would be the Applicant's prejudice, if a stay were granted. In these circumstances, the stay is refused and the Council's Motion is dismissed with costs. LEGGAT: Could your Honour hear me. I'm instructed to put something to your Honour in relation to costs and it's very brief and it's this your Honour.

LEGGAT: As your Honour observed in your judgment on the Motion, the council's Motion was motivated by a desire and an intention to try to minimise costs and to save costs. In those circumstances, I'm instructed to seek from your Honour, an order that there in fact be no order as to costs.

IRELAND: It seems to be clear from your Honour's judgment that your Honour wasn't saying that this stay application was motivated by a desire to conserve costs. Indeed it's associated with an appeal from the interlocutory matter that your Honour has stated is not unreasonable but quite exceptional in a case like this, and an attempt to stay a hearing that would be carried out in a normal course, we say that an order for costs should certainly follow in this case.

HIS HONOUR: Thank you Mr Ireland. Anything further Mr Leggat?

At the conclusion of the argument, I gave reasons for my decision refusing the stay of proceedings sought by the Council and I included in my orders dismissing the Motion, refusing the stay, an order that the Council pay the costs of the Motion. Counsel for the Council immediately responded to submit that in the circumstances of this case, no costs should be awarded in respect of the Motion and the hearing of the Motion, on the ground that the Council's Motion essentially was directed to the saving of costs, rather than the incurring of costs, in this litigation, and that in those circumstances, it would be appropriate not to visit the Council with a costs order.

Notwithstanding that submission, I am of the opinion that in respect of the costs of the Motion, which has been firmly resisted, and which has been ultimately unsuccessful, the Applicant should be compensated for having to make out a case in resisting the Council's stay application. The costs of such a Motion, albeit in Class 1 proceedings, fall within the established practice of the Court to regard as discrete in such proceedings motions (such as this one for a stay) and therefore are to be treated differently from the Court's usual practice of not awarding costs in planning appeals generally. Accordingly I am of the view that the Applicant, having had to meet the application for stay (which if granted, would, for the reasons that I have given in rejecting the Motion, have inevitably prejudiced the Applicant in its pursuit of its pending appeal in this Court) should be compensated for its costs incurred in having to prepare its case against the Motion and having been successful therein.

Accordingly, the orders that I make are that the stay application is refused and Council's Notice of Motion is dismissed with costs.

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