Fairfield City Council v El Nachar

Criminal Procedure Act 1986 s 212, 257D LEGISLATION CITED: Environmental Planning and Assessment Act 1979 s 118BA, 125 First Home Owners Grant Act 2000 s 12 Justices Act 1902 s 118D (repealed)

Fosse v Department of Public Prosecutions [1999] NSWSC 367 CASES CITED: Gordon Plath of the Department of Environment and Climate Change v Vurlow; Gordon Plath of the Department of Environment and Climate Change v Hockey; Gordon Plath of the Department of Environment and Climate Change v Southton [2009] NSWLEC 102 Halpin v Department of Gaming and Racing [2007] NSWSC 815 JD v DPP [2000] NSWSC 1092 Port Macquarie - Hastings Council v Lawlor Services Pty Limited; Port Macquarie - Hastings Council v Petro (No 7) (2008) 159 LGERA 87

PROSECUTOR Mr T Howard SOLICITORS LEGAL REPRESENTATIVES: Ritchie and Castellan DEFENDANT Mr M Vassili (solicitor) SOLICITORS Vassili Fozzard Solicitors

JUDGMENT:

      THE LAND AND
      ENVIRONMENT COURT
      OF NEW SOUTH WALES

50069 of 2008 Fairfield City Council v El Nachar 50021 of 2009 Fairfield City Council v El Nachar

EX TEMPORE JUDGMENT 1 Her Honour: The Council discontinued two prosecutions against the Defendant alleging that he undertook building work without a construction certificate in breach of s 125(1) of the Environmental Planning and Assessment Act 1979 (the EP&A Act). The work was the demolition of an existing cottage and the erection of a new building on residential land in Fairfield. Both proceedings were dismissed on 7 August 2009.

2 The Defendant has filed a Notice of Motion dated 14 August 2009 seeking his costs of both proceedings from the filing of the Class 5 summonses until their dismissal on 7 August 2009 on an indemnity basis pursuant to the Criminal Procedure Act 1986 (the CP Act). There are limitations on the award of costs against a prosecutor acting in a public capacity. There is no dispute in this case the Council was acting in a public capacity. 3 Under s 212 of the CP Act costs may only be awarded in criminal proceedings in accordance with the Act. A prosecutor may be ordered to pay costs under s 257C but this is subject to s 257D. 4 Section 257D(1) provides: 257D Limit on award of professional costs against a prosecutor acting in a public capacity (1) Professional costs are not to be awarded in favour of an accused person in proceedings under this Part unless the court is satisfied as to one or more of the following:

(a) that the investigation into the alleged offence was conducted in an unreasonable or improper manner,

(b) that the proceedings were initiated without reasonable cause or in bad faith or were conducted by the prosecutor in an improper manner,

(c) that the prosecutor unreasonably failed to investigate (or to investigate properly) any relevant matter of which it was aware or ought reasonably to have been aware and which suggested either that the accused person might not be guilty or that, for any other reason, the proceedings should not have been brought,

(d) that, because of other exceptional circumstances relating to the conduct of the proceedings by the prosecutor, it is just and reasonable to award professional costs.

5 The Defendant relies on s 257D(1)(a)(c) and (d). Evidence on motion 6 The following evidence was relied upon by the Council: a) Exhibit to the affidavit of Geoffrey Castellan sworn 3 September 2009 discussed below (exhibit 1). b) Affidavit of Rouyaka Yassin, the Defendant's wife, sworn 6 April 2009 (exhibit 2). Ms Yassin attests to the Defendant being overseas between 6 March 2006 and 7 July 2007 and again between 7 October 2007 and 12 October 2008 and for two weeks in April 2006. Ms Yassin also states that the Defendant told her that Safwan Jazaar was going to buy a house which would be in the Defendant's name. c) Affidavit of the Defendant sworn 6 April 2009 (exhibit 3). The Defendant describes a conversation he had with Mr Jazaar, his wife's cousin's husband, in 2006 in which Mr Jazaar asked whether the Defendant could put a house in the Defendant's name which would be purchased by Mr Jazaar and held on trust by the Defendant. The Defendant states that shortly after this conversation he signed documents which he believed to be relevant to creating a trust. He states that he visited the property only once and has had no active involvement with the property. d) Affidavit of Peter Green, Council officer, sworn 11 September 2008 (exhibit 4). Mr Green attests to having two conversations with a person who behaved as if he was the Defendant on 31 July 2007 and 18 December 2007 and inspecting the property the subject of the proceedings on 18 December 2007. Photographs taken at the inspection are annexed to Mr Green's affidavit. e) A photograph of the property and the new dwelling on it taken 22 July 2008 (exhibit 5). f) Affidavit of Peter Green sworn 24 February 2009 (exhibit 6). In this affidavit Mr Green states that since his affidavit of 11 September 2008 he became aware that the person he spoke to on two occasions was Mr Jazaar and not the Defendant. g) Notice of the determination of development application No. 263/2007 dated 4 July 2007 (exhibit 7).

7 Geoffrey Castellan, solicitor for the Council, swore an affidavit on 3 September 2009. Mr Castellan sets out the history of the proceedings including the investigation of the matter by the Council and the court appearances after the first summons was filed. By reference to the affidavits which were filed and served on the Defendant, Mr Castellan attests that the at the time of the first summons on 19 September 2008 reliance was placed on the following evidence: a) Documentation that the Defendant was the sole registered proprietor of the property as a result of Land Property Information data accessed 28 August 2008, the contract for sale dated 25 January 2006 and the transfer under power of sale. b) The Defendant was the named applicant on a development application seeking consent for the demolition of the existing cottage and erection of a new dwelling at the subject site and was the person to whom consent was granted pursuant to that application. c) The evidence of Council officers who undertook a site inspection on 4 July 2007 and observed the existing dwelling being demolished and the evidence of Council officers again on 18 December 2007 who observed works for the erection of a new dwelling despite a construction certificate having not yet been issued. d) The evidence of Council officers having had a number of conversations in July 2007 and July 2008 with a person identifying himself as the Defendant. 8 Mr Castellan also outlined the steps that the Council took after representations were made by the Defendant's solicitor that the Defendant had an alibi at all material times, that the Defendant held the property on trust for the late Mr Jazaar, that the Defendant had not had any active involvement with the property and did not authorise the work and that certain documents which were produced under subpoena and appeared to bear the Defendant's signature were not in fact signed by him. Mr Castellan attests these representations occurred as follows: a) On 31 October 2008 at a directions hearing Mr Vassili indicated that he would make representations to the Council by 14 November 2008 based upon the Defendant's passport to the effect that the Defendant was overseas at the material times. The time for making such representations was extended to 26 November 2008. On 28 November 2008 the passport was brought to the Mr Castellan's office. Mr Castellan attests that the passport did not suggest that the Defendant was outside Australia from the period commencing the date the development consent was granted (4 July 2007) through to the date of observations by the Council of the demolished cottage (around 20 July 2007). The passport indicated the Defendant arrived in Lebanon after the demolition had been carried out. b) The Council caused a number of subpoenas to be issued by the Court in January and February 2009 in order to test the Defendant's representations. c) Five affidavits were filed and served by the Council on 24 February 2009, four of which were of Council officers responding to the representations that the Defendant was overseas on the dates on which officers had said in earlier affidavits that they had spoken to the Defendant. These affidavits deposed that the person who identified himself as the Defendant was now known to them as Mr Jazaar. As a result the Council commenced the second charge against the Defendant on 5 March 2009. d) In terms of the trust representation, this issue was brought to the Council's attention by Mr Vassili on 19 February 2009 in a phone conversation with Mr Castellan's colleague in which Mr Vassili indicated to Mr Castellan's colleague that a trust arrangement could explain why a third party had done the work at the site. The issue was raised again by Mr Vassili in a letter to the Council dated 19 March 2009. Mr Castellan responded to this letter on 19 March 2009. 9 Mr Castellan attests to reviewing the documents produced under subpoena in respect of this representation of a trust. He states that the documents, exhibited to his affidavit, established the following: a) The Defendant applied for a loan on 8 February 2006 to assist in purchase of the property. This application included the representation by the Defendant that he was not a trustee. A statutory declaration of Mr Jazaar in which Mr Jazaar stated that he was giving the Defendant a sum of $70,000 (non-refundable) to help the Defendant in his purchase of the property was lodged with the loan application. b) On 25 September 2007 the Defendant made an application for a further loan of $50,000 for the building of a new residence and Mr Castellan attests that this application refers to the demolition of the previous residence in a handwritten section apparently signed by the Defendant. c) The Defendant applied for and obtained a First Home Owners Grant for his purchase of the property on 6 June 2006 and applied for and obtained exemption from the stamp duty on the purchase of the property pursuant to the First Home Plus Scheme. Statutory declarations that the Defendant was the purchaser and that he would be residing in the home for a continuous period of six months accompanied the applications. d) The Defendant's solicitor for the purposes of his purchase of the property recorded in a letter to the Defendant dated 2 February 2006 that the Defendant intended to demolish the house.

10 Documents annexed to the affidavit of Mr Green sworn 24 February 2009 refer to events prior to the proceedings being commenced: a) On 19 March 2007 DA 263/2007 was lodged with the Council. This DA identified the Defendant as the owner of the property the subject of these proceedings and proposed to demolish the existing house and build a new two-storey dwelling. b) This development application was approved in a notice of determination dated 4 July 2007 sent to the Defendant. c) An application to modify the development consent granted in respect of DA 263/2007 was lodged by Mr Jazaar on 16 September 2008. The owner was identified as the Defendant. d) This modification application was approved in a notice of determination dated 26 September 2008 sent to Mr Jazaar.

11 The Defendant relied on the affidavit of his solicitor, Michael Vassili, sworn 14 August 2009. Mr Vassili states that he raised with the Council at the earliest opportunity that the proceedings had been commenced against the wrong person and that the Defendant could not have committed the offence because he was overseas at all material times. Mr Vassili's affidavit provides a similar summary of the court appearances in the matter after the summons had been issued as that set out in the affidavit of Mr Castellan. Annexed to Mr Vassili's affidavit were, inter alia, three letters sent by Mr Vassili to the Council's solicitors dated 20 November 2008, 26 November 2008 and 19 March 2009. In the letter of 20 November 2008 Mr Vassili confirms informal representations made to the Council that the Defendant was absent from the jurisdiction at all material times and that documentary verification of this was being sought. In the letter of 26 November 2008 Mr Vassili advises that the Defendant's passport does not indicate re-entry but confirms the representation that the Defendant was out of the country at all material times. In the letter of 19 March 2009 notice is provided that Mr Jazaar has passed away and that the Defendant has acted as a trustee in holding the property the subject of proceedings on trust for Mr Jazaar. Defendant's submissions 12 There were two errors in the investigation of the Council. Firstly, Mr Green failed to establish that he was speaking to the Defendant when he attended the site on 18 December 2007. He should have asked for photographic identification at that stage to be certain that the person he was speaking to was (or was not) the Defendant. The Council had an obligation to commence proceedings on the basis of a prima facie case after conducting a reasonable investigation and has failed to do so. Section 257D(1)(a) applies in these circumstances. 13 Secondly, the Council failed to properly investigate whether the Defendant was in control of the building works the subject of the charges carried out on the property. Commencing in November 2008 Mr Vassili made representations on behalf of the Defendant that he was out of the country and stated that his passport and tickets demonstrating travel arrangements would be provided. Mr Vassili attended with the passport at the offices of Mr Castellan. The passport showed that the Defendant went to Lebanon on 7 October 2007 (the demolition work the subject of the charges was in July 2007). In November 2008 the Council could have issued a notice under s 118BA of the EP&A Act requiring the Defendant to attend an interview for questioning. As a responsible prosecutor, that course should have been taken at the earliest opportunity. Further representations were made in relation to the passport during November 2008 and thereafter. This shows a failure to which s 257D(1)(c) applies. 14 In March 2009 the circumstance was raised by the Defendant's solicitors that the Defendant held the property on trust for another person. This was confirmed in the affidavit of the Defendant sworn 6 April 2009 and that he was inactive in relation to the property. This could also have been explored with the issue of a notice under s 118BA once again and this should have been done before the amended summons was filed in March 2009 to change the basis of the charge to vicarious liability. It is not for the Defendant to foreshadow relevant issues. Lateness in relation the disclosure of the trust should not result in the Defendant being penalised by there being no award of costs. 15 The further inquiries undertaken by the Council's solicitor would not have advanced the position at all given the content of par 14 of the Defendant's affidavit that he signed various documents. These inquiries simply delayed the decision to discontinue the proceedings and caused further costs to be incurred. 16 The Council's own evidence was that it had the wrong person as identified in the second affidavit of Mr Green. The first reference to Mr Safwan Jazaar is in a letter dated 19 March 2009 from Mr Vassili but he was already known to the Council because he was the applicant for a modification application in relation to the development consent granted in September 2008. 17 These circumstances are exceptional as the failure to inquire about the identity of the person on site was quite unreasonable so that s 257D(1)(d) applies. The Defendant considered his strongest case was in relation to s 257D(1)(c) rather than (a). 18 The written submissions identified numerous authorities concerning what a failure to properly investigate entailed such as Halpin v Department of Gaming and Racing [2007] NSWSC 815, JD v DPP [2000] NSWSC 1092 and Port Macquarie - Hastings Council v Lawlor Services Pty Limited; Port Macquarie - Hastings Council v Petro (No 7) (2008) 159 LGERA 87. Council's submissions 19 The Defendant has at no time contested the following facts, all of which are the subject of evidence filed for the Council: (a) The Defendant was at all material times the sole registered proprietor of the land (b) The subject demolition and building works were carried out on the land: (i) the demolition of the existing cottage was carried out in around late July 2007 (ii) building works for the erection of the new dwelling on the land were carried out in the period from around late July 2007 through to about December 2008, by which time the new dwelling was substantially completed. (c) There was a development consent in force in respect of the development, namely DA 263/2007 (the development consent) (d) The development consent included condition 6 (e) No construction certificate was ever issued for the carrying out of the works approved by the development consent. 20 Although there was no contest as to the above facts, the Defendant disputed that he was responsible for the carrying out of the subject demolition and building works. 21 Until being notified of the property being held in trust by the Defendant, via submissions from his solicitor in March 2009 and finally in the affidavit of Mr El Nachar dated 6 April 2009, as far as the Council could be aware, the property was held by him as the registered proprietor and he applied as the applicant and owner for development consent to demolish and rebuild on a residential lot. That was the nature of the work carried out without a construction certificate the subject of the offences. It was entirely reasonable for the Council to assume the work was being done for the benefit of the Defendant. That there might be an alibi if the Defendant was overseas does not mean that the Council should not pursue charges based on vicarious liability where the building had been erected. Mr Green went to the property and the person there said he was the Defendant. The failure to ask for photographic identification, if that was failure, was not unreasonable in the circumstances and not so deficient as to enliven s 257D(1). It was reasonable to commence proceedings and pursue them with a further summons filed in March 2009. 22 It was reasonable to prosecute both proceedings until the issue that the Defendant held the property in trust for Mr Jazaar was raised in the affidavit of the Defendant dated 6 April 2009. The Council addressed whether it was reasonable to make inquiries as detailed in Mr Castellan's affidavit, summarised above. The documents such as the First Home Owners Grant application in which the Defendant attests that he intended to occupy the property for six months is in accordance with the eligibility criteria specified in s 12 of the First Home Owners Grant Act 2000 suggest that the Defendant intended to have a greater involvement with the property than the Defendant's affidavit sworn in April 2009 suggested. It was necessary and reasonable for the Council to consider all these matters before it decided not to proceed with the prosecutions. 23 Sections 257D(1)(a) and (c) relate to investigation rather than proceedings. Section 257D(1)(d) is the only section relied on by the Defendant's solicitor dealing with the conduct of proceedings and there are no exceptional circumstances justifying an award of costs. Finding 24 In order to make an award of costs in the Defendant's favour at least one of the subsections in s 257D must be satisfied. In Fosse v Department of Public Prosecutions [1999] NSWSC 367 Wood CJ at CL held that the onus lay on the defendants seeking a costs order to bring themselves within the statutory provisions of s 118D(1) of the Justices Act 1902 (the predecessor to s 257D and now repealed). The parties have identified many relevant authorities. Most recently I considered the relevant principles in Gordon Plath of the Department of Environment and Climate Change v Vurlow; Gordon Plath of the Department of Environment and Climate Change v Hockey; Gordon Plath of the Department of Environment and Climate Change v Southton [2009] NSWLEC 102 at [25]-[28] in relation to the failure to properly investigate in s 257D(1)(a). The failure does not have to be a failure to meet optimum standards but is an objective test based on what inquiries were made and should have been made by the Council. Section 257D(1)(c) requires a finding that the prosecutor unreasonably failed to investigate a relevant matter of which it should have been aware and which suggested that the accused person might not be guilty, inter alia. The Defendant's solicitor did not identify with much precision the matter(s) which the Council should have been aware of but I infer it was that the person on site interviewed by Mr Green was not the Defendant, despite saying that he was, and that the beneficiary of the development consent was really Mr Jazaar not the Defendant because Mr Jazaar was the applicant for the modification of the development consent in September 2008. 25 In relation to the period leading up to the commencement of proceedings and whether the investigation giving rise to these was conducted in a proper and reasonable manner, for the reasons given by the Council I consider the proceedings commenced in September 2008 and the further summons filed in March 2009 were reasonably commenced. The circumstances of this matter demonstrate clearly no concern arises in relation to the Council's investigation as being improper or unreasonable in relation to s 257D(1)(a). The Council officer Mr Green not asking for photographic identification when the person on site acted as if he was the Defendant was not unreasonable. Further, while the Defendant's solicitor argued that the Council should have required attendance at an interview under s 118BA, the affidavit of Mr Castellan identifies the steps the Council did take in light of the submissions received. These steps show the Council was taking active and proper steps to investigate the matters being raised. 26 The representations made by Mr Vassilli in relation to the Defendant's alibi and the production of the passport all took time and not all the information about travel such as tickets and an itinerary was provided in any event. As pointed out by the Council, based on the passport stamps the Defendant was in Australia at the time of the demolition giving rise to the prosecution. The Council appears to have acted properly in relation to the inquiries it undertook. No failure to investigate properly a relevant matter arises in the circumstances and s 257D(1)(c) does not apply to this stage of the proceedings. 27 In relation to the Council's inquiries to establish the bona fides of the Defendant's evidence in relation to the trust, I note that no documentary proof of the existence of the trust was attached to the Defendant's affidavit. There is simply an assertion in par 14 that the Defendant signed some documents which he thinks related to the trust. Given that there was delay in advising of the existence of the trust by the Defendant, which was clearly a material matter about which the Council could not be expected to have any knowledge other than what the Defendant or his advisers told the Council, it was reasonable for the Council to undertaken further inquiries concerning the Defendant's behaviour in relation to the property of which he was the registered proprietor. That these inquiries suggested that the Defendant had made applications for a mortgage and a grant under the first home owners scheme which suggested that he intended to live at the property, contrary to his affidavit filed in these proceedings, was material which the Council had to weigh up in determining if the two proceedings should be pursued. The Defendant's submission that he should not be penalised is not to the point. What has to be assessed is the reasonableness of the Council's behaviour. 28 I should note that the Defendant's solicitor stated in his submissions in reply that had the two matters been heard there would have been a dispute and evidence, including the calling of a handwriting expert, about whether the signatures on the documents produced under subpoena were those of the Defendant. The highly unusual circumstance that all the documents with the signature of the Defendant obtained by the Council under subpoena were not signed by him is not a matter about which the Council could have any knowledge. It was reasonable for it to proceed with its investigation on the usual basis that the signatures on the documents were the Defendant's. The investigations identified in the affidavit of Mr Castellan were entirely reasonable in the somewhat peculiar circumstances of this matter. Not discontinuing the proceedings until August 2009 was reasonable. A failure referred to in s 257D(1) does not arise in this part of the proceedings either. 29 There was no additional evidence relied on in the Defendant's submissions in relation to the application of s 257D(1)(d), that there were exceptional circumstances relating to the conduct of the proceedings suggesting it was just and reasonable to award costs. Having failed to satisfy ss (a) and (c) there would have to be some additional matter which would cause ss (d) to arise in the circumstances of this case and there are none relied on by the Defendant. 30 The Defendant has not established any of the grounds in s 257D(1) to warrant an award of costs in his favour and the Notice of Motion is dismissed. The Council is not entitled to its costs in light of s 257B so that each party should pay its own costs of the motion.

Orders 31 The Court makes the following orders: 1. The Defendant's Notice of Motion is dismissed. 2. Each party is to pay its own costs of the Defendant's Notice of Motion.

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