Friends of Bucketty Inc v Bucketty’s Brewery Pty Ltd

Legislation Cited: Associations Incorporation Act 2009 (NSW)
Uniform Civil Procedure Rules 2005 (NSW), rr 42.21, 42.21, 59.11
Liquor Act 2007 (NSW)
Environmental Protection and Assessment Act 1979 (NSW)
Cessnock Local Environmental Plan 2011 (NSW)

Cases Cited: Baker v The Queen (2004) 223 CLR 513; [2004] HCA 45
Boronia Park Preservation Group v MSMG Developments Pty Ltd (2015) 209 LGERA 259; [2015] NSWLEC 112
Friends of King Edward Park Inc v Newcastle City Council (2012) 194 LGERA 226; [2012] NSWLEC 113
Maule v Liporoni (2002) 122 LGERA 140; [2002] NSWLEC 25
Save Little Beach Manly Foreshore Incorporated v Manly Council (2013) 198 LGERA 304; [2013] NSWLEC 155
Seek Justice Pty Ltd v New South Wales (No 2) [2024] NSWSC 1410
Suchand Pty Ltd v Colbran (2024) 115 NSWLR 587; [2024] NSWCA 250

Texts Cited: NA

Category: Procedural rulings

Parties: Friends of Bucketty Incorporated (First Applicant)
Bucketty’s Brewery Pty Ltd (First Respondent)
Nicholas Vernon McDonald (Second Respondent)
Alexi Kathleen McDonald (Third Respondent)
Cessnock City Council (Fourth Respondent)

Representation: Counsel:
L Sims (Applicant)
C Ireland (Respondent)
Solicitors:
Bartier Perry (Applicant)
Hicksons Hunt & Hunt (First, Second, Third Respondents)
Sparke Helmore (Fourth Respondent)

File Number(s): 25/234848

Publication restriction: Nil

ex tempore JUDGMENT

1. The Applicant has commenced judicial review proceedings challenging the development approval by Cessnock City Council the Fourth Respondent (the Council) of a pub, restaurant and ancillary brewery on land at Bucketty. It seeks a declaration that the development consent dated 24 March 2025 is invalid and of no effect. The First Respondent is the beneficiary/owner of the land to which the approval applies. The Second Respondent is a director and the Third Respondent is a shareholder of the First Respondent.

2. The Applicant was incorporated under the Association**s Incorporation Act 2009 (NSW) on 15 June 2025. The summons commencing proceedings was filed on 29 July 2025. The objects of the association are specified in the constitution as follows:

Friends of Bucketty is a not-for-profit institution formed for the purpose of advancing the protection of the natural environment across the Bucketty bush community by helping to support land use sympathetic to and supportive of native flora and fauna diversity and health. The dominant purposes of Friends of Bucketty are the advancement of mental health and provision of relief from social isolation by encouraging and coordinating individuals to advance projects protective of the natural environment.

3. The First, Second and Third Respondents have filed a notice of motion dated 29 July 2025 seeking orders for security for costs to be provided in the amount of $60,000 and that the proceedings be stayed if that security for costs is not provided. As the Council has played no role in relation to the notice of motion having filed a submitting appearance, I will refer collectively to the First, Second and Third Respondents as the Respondents in this judgment.

4. The U**niform C**ivil P**rocedure R**ules 2005 (NSW) (UCPR) provide:

42.21 Security for costs

(1) If, in any proceedings, it appears to the court on the application of a defendant—

…

(d) that there is reason to believe that a plaintiff, being a corporation, will be unable to pay the costs of the defendant if ordered to do so, or

(e) that a plaintiff is suing, not for his or her own benefit, but for the benefit of some other person and there is reason to believe that the plaintiff will be unable to pay the costs of the defendant if ordered to do so,

…

5. Under UCPR r 59.11 a plaintiff is not required to provide security for costs in respect of judicial review proceedings unless there are exceptional circumstances.

6. Firstly, considering UCPR r 42.21(1) the Respondents rely on subr (1)(d) (Applicant unable to pay costs if ordered to do so) and subr (1)(e) (Applicant suing for benefit of others) and bear the evidential burden of proving that the rule should be applied.

7. Secondly, if UCPR r 42.21 applies, UCPR r 59.11 arises because exceptional circumstances are required before making a security for costs order in judicial review proceedings, and the onus of proving such circumstances exist rests on the Respondents to establish.

Grounds of judicial review

8. The summons filed by the Applicant identifies four grounds of review:

9. failure to consider a mandatory consideration being that the Fourth Respondent (the Council) failed to consider the ‘proposed instrument’ and that failure was material to the decision to approve;

10. failure to consider the proposal as an integrated development (related to the proximity of the development to the creek running across the property);

11. failure to notify the public of the development as integrated in accordance with statutory requirements;

12. the grant of consent was for prohibited development and therefore invalid (requiring characterisation of the development in the statutory context).

13. The summons describes the Applicant’s members as ‘including members who reside in and around Bucketty, and on land that is in the vicinity of the Land’.

Evidence

10. An affidavit of Mr Wilcher solicitor dated 29 July 2025 exhibited a record showing the date of incorporation of the Applicant on 5 June 2025 and providing an estimate of likely professional costs of the Respondents if the matter proceeds to hearing of about $64,000.

11. Mr Wilcher’s affidavit of 12 August 2025 exhibited documents concerning the Applicant’s incorporation, a Facebook post of the public officer, a newspaper article on or about 6 September 2024 outlining protests in the local community in relation to the proposed development, emails exchanged between the future public officer of the Applicant and one of the Respondents, and conversations between Mr Wilcher and a surveyor about the location of a creek running across the land and asking for the surveyor’s opinion about the width of the creek. Annexed survey plans showed distances of building and other infrastructure proposed on the land to the middle of the creek.

12. The notice to produce and subpoena issued by the Respondents seeking financial records of the Applicant and its members supporting the litigation and the Applicant’s constitution were tendered.

13. An affidavit of Mr Steven Griffiths solicitor sworn 19 August 2025 addressed the scope of documents produced in answer to the notice to produce and subpoena which included a redacted bank account statement showing $1,000 in the bank account. Mr Griffiths attested that $8,000 was held in the trust account. Mr Griffiths also attested based on his instructions to the reasons why documents had been redacted to protect the personal information of the members of the Applicant due to such information being unnecessary for the Respondents’ notice of motion inter alia.

Rule 42.21 UCPR(1)(d)-(e)

14. Relying on r 42.21(1)(d), unable to pay costs, the Respondents relied on the financial information provided in Mr Griffith’s affidavit of $1,000 in the bank account, and that $8,000 is held on trust for the Applicant’s own legal fees which holdings fall well short of the amount of $64,000 estimated to be incurred by the Respondents in legal fees if the Applicant is unsuccessful. The Applicant did not provide evidence of other assets and there is no evidence that members have an obligation to pay debts as they arise.

15. The relevant test is identified in Suchand Pty Ltd v Colbran (2024) 115 NSWLR 587; [2024] NSWCA 250 at [48]-[49]:

It is for the party seeking an order for security for costs to establish that there is reason to believe that the other party to the litigation will be unable to pay the costs of the litigation if unsuccessful, and once this onus has been discharged, the onus shifts to the other party to establish a reason why security should not be granted: Wollongong City Council v Legal Business Centre Pty Limited [2012] NSWCA 245. The test has been described as an “undemanding one”, requiring that a rational basis be established for the requisite belief: Treloar Constructions Pty Limited v McMillan [2016] NSWCA 302 at [11] (Beazley ACJ).

The words “reason to believe” acknowledge that, as a matter of practicality, on an application for security for costs a court will not be able to undertake as thorough an examination of the financial position of a plaintiff as it would at a final hearing. In this regard, the words of the statute should be applied and a conclusion that there is a risk that a plaintiff will not be able to pay a costs order will not suffice: Cornelius v Global Medical Solutions Australia Ltd [2014] NSWCA 65 at [16] (Macfarlan JA, Tobias AJA agreeing). As Ward JA (Tobias AJA agreeing) added at [59], the existence of a real risk of an inability to pay a costs order could provide a rational basis for the requisite belief.

Finding on subrule (1)(d)

16. I agree with the Applicant’s submission that the Respondents have not established on the onus they bear of having ‘reason to believe’ that the Applicant will be unable to pay costs if ordered to do so, accepting that test is undemanding. Risk of non-payment is insufficient. The bank account shows regular payments in and out suggesting that the Applicant has been able to meet its debts as these fall due. That the bank account does not currently have assets equivalent to the possible costs identified by Mr Wilcher is not sufficient reason for that belief.

17. Relying on r 42.21(1)(e) the Respondents alleged that the Applicant is suing for the benefit of its members who are ‘third parties’. The Applicant is a residents’ group aimed at protecting the local amenity of those living in the locality near the land. The Applicant is not concerned with the broader environmental or public interest issues. The litigation is for the benefit of third parties being its members who live locally and want to protect their amenity. Reliance was placed on a newspaper article by a person who became the public officer in a local newspaper identifying opposition to the proposed development, exhibited to the affidavit of Mr Wilcher.

18. Further, there is no evidence that the Applicant has done anything other than commence this court case giving rise to the inference that doing so is its sole purpose (sole vehicle use). The recent incorporation of the Applicant not long before the summons was filed supports these submissions.

Finding on subrule (1)(e)

19. The Respondents sought through limited evidence such as reference in the summons to members living locally and the newspaper article exhibited to the affidavit of Mr Wilcher to support an argument that it was acting for the benefit of third parties. That limited evidence does not support a finding that the Applicant is acting on behalf of third parties.

20. As the Applicant submitted there is no evidence to support the assertions of the Respondents that the sole purpose of the Applicant is to proceed with the litigation. As the Applicant submitted the ‘sole vehicle use’ submission was not identified expressly in the Respondents’ submissions or evidence and neither party has brought forward evidence about it.

21. Recent incorporation alone does not give rise to an inference of sole vehicle use or acting on behalf of third parties, as also observed in cases such a Boronia Park Preservation Group v MSMG Developments Pty Ltd (2015) 209 LGERA 259; [2015] NSWLEC 112 at [60]; see also Friends of King Edward Park Inc v Newcastle City Council (2012) 194 LGERA 226; [2012] NSWLEC 113 at [10].

22. The objects of the Applicant are broad and refer to the purpose of advancing the protection of the natural environment across the Bucketty bush community by helping to support land use sympathetic to and supportive of native flora and fauna inter alia. The newspaper article in evidence refers to concerns by the local community about the clearing of vegetation resulting from the development proposed. The Respondents’ submissions sought to pigeonhole such concerns as ‘merely’ the protection of amenity for individuals but such concerns are also broader in nature.

23. It is unnecessary for the determination of the issues before me to decide whether the proceedings are public interest in nature. The Applicant did not make that submission and it appeared to be raised by the Respondents to distinguish the decision of Save Little Beach Manly Foreshore Incorporated v Manly Council (2013) 198 LGERA 304; [2013] NSWLEC 155.

24. The Respondents have not established a basis for the application of r 42.21(1)(d)-(e).

25. I do not strictly therefore need to consider r 42.21(1A) being the discretionary considerations which may apply if determining whether a security for costs order ought to be made for an applicant to which subrule (1) is found to apply. Nor do I need to consider r 59.11. I will briefly canvas arguments made in relation to r 59.11, which overlap with what I have already considered in relation to r 42.21(1)(e).

26. One argument I have not considered which the Respondents submitted gave rise to exceptional circumstances was the lack of prospects of success of the Applicant’s case. The Respondents submitted that the four grounds of review were hopeless and doomed to fail in the context of exceptional circumstances existing.

No exceptional circumstances

27. The meaning of exceptional circumstance was identified in Baker v The Queen (2004) 223 CLR 513; [2004] HCA 45 at [173] cited in Seek Justice Pty Ltd v New South Wales (No 2) [2024] NSWSC 1410 at [81] as:

“Exceptional circumstances” in r 59.11 were discussed in Baker v R (2004) 223 CLR 513; [2004] HCA 45, where reference was made to R v Kelly [2000] QB 198 at 208. There it was held that “exceptional” must be construed “as an ordinary, familiar English adjective, and not as a term of art. It describes a circumstance which is such as to form an exception, which is out of the ordinary course, or unusual, or special, or uncommon. To be exceptional a circumstance need not be unique, or unprecedented, or very rare; but it cannot be one that is regularly, or routinely, or normally encountered.”

28. It should also be noted that r 59.11(2) states that:

59.11 Security for costs

…

(2) Where a plaintiff—

(a) invokes an open standing provision, or

(b) commences representative proceedings,

the court is not to treat the plaintiff as bringing proceedings for the benefit of a third party for the purposes of considering whether exceptional circumstances exist.

29. The Applicant is relying on an open standing provision.

30. The Respondents submitted that exceptional circumstances do exist because:

31. the Applicant is a special purpose vehicle incorporated for the purpose solely of running these judicial review proceedings evidenced by the recent incorporation of the Applicant two weeks before commencing proceedings, the summons identifying that members are local residents who must stand to benefit personally in having their amenity protected, and there is no evidence that the Applicant has done anything else other than commence court proceedings. I have not accepted such submissions above at [19]-[22]. These circumstances are not exceptional.

32. the Applicant’s case is weak, being manifestly hopeless. I observe that this notice of motion is not seeking summary dismissal of the summons and asking the Court to draw final conclusions about any legal case is not appropriate. Under r 42.21(1A)(a) the prospects of success are a relevant matter in determining whether a security for costs order is warranted, and to the extent I make findings in the context of r 59.11 they will be interlocutory not determinative of what would occur at a final hearing.

33. As set out above in [8], the summons filed by the Applicant identifies four grounds of review.

34. I observe in relation to all of the grounds that none are self-evidently doomed to fail contrary to the Respondents’ submissions in light of the Applicant identifying additional matters which were not addressed by the Respondent’s submissions and evidence.

35. The Applicant asserted in relation to ground 1 that the relevant instrument was considered in the statement of reasons of the Council and referred to in the assessment report before the Council and that there was more than ‘mere advertence’ to the document so that the ground was doomed to fail. The Applicant identified that its case is directed to the manner of consideration being limited to one aspect in its case, the transitional savings provisions, and more was required. I am unable to conclude that the case is not arguable.

36. In ground 2 the issue arises of whether the development should have been considered as integrated development. The Respondents submitted this issue was settled in Maule v Liporoni (2002) 122 LGERA 140; [2002] NSWLEC 25. The Applicant submits another legal approach is available. I am not able to weigh up the legal issue in any determinative way about prospects other than considering that there appears to be an arguable issue.

37. The survey evidence and conversations attested to in Mr Wilcher’s affidavit dated 12 August 2025 were designed to show that a controlled activity approval was not triggered in answer to ground 2 so that the development could not be integrated development. The Applicant identified that other necessary activity to support the development including land clearing was not the subject of evidence about the distance to the creek. Based on the limited evidence and submissions it appears there is a factual basis on which the ground can be argued.

38. Ground 3 alleges a failure to notify the proposal as integrated development which requires notification for a minimum period of 28 days. The proposal was notified for two different periods of 14 days which the Respondents submitted was self-evidently sufficient. As the Applicant submitted, its case is that notification as integrated development requires each period of notification to be a minimum of 28 days. The ground appears arguable.

39. Ground 4 raises issues of characterisation of the development and was clearly more involved than the Respondents’ assertion that the Applicant was erroneously applying considerations under the Liquor Act 2007 (NSW) to considerations under the Environmental Protection and Assessment Act 1979 (NSW) given the definition of ‘pub’ in the Cessnock L**ocal E**nvironmental Plan 2011 (NSW). No basis for finding that ground is weak has been made out and it appears to be arguable.

40. No exceptional circumstances have been established for the purposes of r 59.11.

41. The order for security for costs as sought will not be made.

42. As the Respondents have been unsuccessful on the notice of motion they must pay the costs of the Applicant.

Orders

41. The Court orders:

42. The notice of motion dated 29 July 2025 is dismissed.

43. The First, Second and Third Respondents must pay the Applicant’s costs of the notice of motion dated 29 July 2025 as agreed or assessed.

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