GORCZYNSKI v Annandale Services Pty Limited & 1 Ors; GORCZYNSKI v PERERA & 1 Ors; GORCZYNSKI v Leichhardt Council

LOWER COURT Land & Environment Court JURISDICTION : LOWER COURT L&E 40120/00 FILE NUMBER(S) : L&E 30079/00 L&E 40012/00 LOWER COURT Cowdroy J JUDICIAL OFFICER :

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40137/03 CA 40138/03 CA 40699/03 L&E 40120/00 L&E 30079/00 L&E 40012/00

MEAGHER JA SANTOW JA IPP JA

15 MARCH 2004 Peter Francis GORCZYNSKI v ANNANDALE SERVICES PTY LIMITED & 1 Ors Peter Francis GORCZYNSKI v Ravini Neluka PERERA & 1 Ors Peter Francis GORCZYNSKI v LEICHHARDT COUNCIL Judgment 1 MEAGHER JA: I agree with Santow JA. 2 SANTOW JA: INTRODUCTION This is an application for both leave, and, if granted, the disposition of three appeals, all in relation to costs only. These three appeals are CA 40699/03 (LEC 40012/00), CA 40137/03 (LEC 40120/00) and CA 40138/03 (LEC 30079/00). 3 The claimant in the three appeals was the owner and occupant of 78 Booth Street, Annandale, Peter Francis Gorczynski; he was also the appellant in the main appeal. The first opponent in CA40699/03, and the second opponent in CA40137/03 is Leichhardt Council. The first and second opponents in CA40138/03 were the occupants of 80 Booth Street, Annandale. This property is the adjoining property to No 78. No. 80 is the property that is the subject of both these cost appeals and the main judgment (now CA 40250/03 being the main appeal). The first opponent in CA 40137/03 is Annandale Services Pty Ltd. 4 The judge at trial set out a brief outline of the facts in the three matters. It was stated at the end of the hearing of the main appeal that resolution of it was not likely to lead to resolution of those three leaves to appeal, as they relate to different aspects of this voluminous litigation though related in subject matter. Not irrelevant to the exercise of discretion to grant or withhold leave, this litigation has already involved cost and complexity in no way proportionate to the modest amount at stake. It was accepted that no oral hearing was required, as the written submissions said all the parties wished to say on the three leaves to appeal.

SALIENT FACTS CA 40699/03 5 The trial judge summarised the relevant facts in this application: "[1(a)] The original class 4 application in these proceedings filed 24 January 2000 challenged the validity of development consent No 334/98 authorising certain structures including a garage/ workshop located at the rear of No. 80 ("the garage") which had previously been erected without consent on or about May 1997. This application also challenged the validity of two building certificates No.187/99 and No.269/99 and sought the demolition of encroachments onto the applicant's land. [4] These proceedings did not reach a final hearing as all the issues between the parties, save the issue of costs, were resolved and accordingly the application was dismissed on 28 June 2002. [22] The first respondents demolished a significant portion of the allegedly unlawful works on 22 March 2001. However, not all the works which were the subject of the challenge were demolished and these remaining works were dealt with in the consent orders made on 28 June 2002." 6 The trial judge determined that there be no order for costs against the first opponent. The trial judge did however award costs to the applicant against the second and third respondents: "[24] Although these proceedings did not proceed to a final hearing on the merits, the orders made on 28 June 2002 and the adoption of the Gleeson Report have the combined effect that the applicant was successful in obtaining the orders it sought against the first respondents. Accordingly the ordinary rule that costs should follow the event will apply (see generally Oshlack v Richmond River Council (1998) 193 CLR 72). These costs will include the applicant's costs in relation to the appointment of the referee and of the Gleeson Report." 7 The applicant claims that a costs order should also have been made against the first opponent.

CA 40138/03 8 The facts of this matter were as stated by the trial judge: "[1(b)] By class 3 application filed on 20 June 2000 the applicant sought demolition of the garage for reason that it encroached upon his land. The proceedings were instituted against the first and second respondent only and did not involve Leichhardt Council" 9 The trial judge concluded that the power of the court to grant relief where an encroachment has occurred is discretionary (s3(3) of the Encroachment of Buildings Act). Accordingly the court could not be satisfied that the claimant was almost certain to have succeeded at trial. Furthermore the trial judge found that neither party had conducted itself in such an unreasonable manner in the proceedings that it should be made to bear the burden of the other party's costs. 10 The trial judge set out to describe the facts of this matter in these terms: "[1(c)] By class 4 application filed 14 August 2000 the applicant sought interlocutory orders restraining the council from assessing development application D2000/434 dated 6 June 2000 lodged by Annandale Services Pty Limited ("Annandale Services") [the former lessor of No. 80] seeking consent to use the whole of No. 80 for the purpose of a real estate agency. These proceedings did not involve the first respondents [The occupants of No 80]. [30] The applicant was unsuccessful in obtaining interlocutory relief and did not ultimately pursue his claim for final relief in these proceedings. His claim for final relief was made redundant because the council granted development [scil. Consent] for use of part of No. 80 as a real estate agency with development consent D/2001/254 which is subject to challenge in proceedings 40208 of 2001." 11 His Honour ruled that the claimant would have almost certainly have failed in obtaining a declaration that the permit was invalid. Accordingly the court ordered that the claimant pay the costs of the second opponent ("the Council"). 12 However, the Court was not satisfied that the claimant would necessarily have failed in obtaining the orders it sought restraining Annandale Services from using No. 80 as a real estate agency since that company had not obtained consent to do so. Accordingly the Court made an order that Annandale Services and the claimant bear their own costs in relation to proceedings 40120/00. 13 The claimant appealed against both of these rulings. He argued that both the first and second opponents should have paid for his costs. He submitted that the trial judge "appears to have omitted to consider that the Local Environment Plan at issue in a later proceedings (40808/01) was not the same Local Environment Plan at issue in the subject proceedings (40120/00)". The claimant contended that: "The council was alive to the distinction and twice refused to grant consent to DA D/2000/434 for the reason that the subject use was not permissible pursuant to the LEP under which the claimant brought this proceedings. In those circumstances the Trial Judge, with respect, erroneously equated the planning considerations in proceedings 40120/00 with those in 40208/01. It was the claimant who was almost certain to have obtained a declaration in proceedings 40120/00 that the use of the subject premises as a real estate agency was not permissible."

Disposition of Leaves to Appeal 14 The appellant seeks leave to appeal against three costs orders. Leave to appeal against an order solely relating to costs does not lie as of right and is at the discretion of the court; see s101(2)(c) of the Supreme Court Act 1970: " 101 Appeal in proceedings before the Court

(2) An appeal shall not lie to the Court of Appeal, except by leave of the Court of Appeal, from:

……… (c) a judgment given or order made in proceedings in the Court with the consent of the parties or as to costs only which are in the discretion of the Court, ………" 15 It is long settled that the approach to be taken when deciding whether to grant leave to appeal from matters of practice and procedure was as stated by Jordan CJ in In re the Will of F B Gilbert (deceased) (1946) 46 SR(NSW) 318 at 323: "... there is a material difference between an exercise of discretion on a point of practice or procedure and an exercise of discretion which determines substantive rights. In the former class of case, if a tight rein were not kept upon interference with the orders of Judges of first instance, the result would be disastrous to the proper administration of justice. The disposal of cases could be delayed interminably, and costs heaped up indefinitely, if a litigant with a long purse or a litigious disposition could, at will, in effect transfer all exercises of discretion in interlocutory applications from a Judge ... to a Court of Appeal." 16 Costs are, as a general rule, matters of practice and procedure, and therefore subject to the same stringent standards as Gilbert. Thus Priestley JA in Wentworth v Rogers (No 3) (1986) 6 NSWLR 642 at 651: "In a great many cases, including the present, costs are in the discretion of the Court; they also seem to me to fall within the category of matters of practice or procedure. The same policy therefore seems to me to underlie the granting or withholding of leave to appeal in a case such as the present as the policy described by Jordan CJ in Re the Will of F B Gilbert (Deceased) (1946) 46 SR(NSW) 318 at 323;" 17 Since the decision in Gilbert there has been recognition of the need to instil a sense of finality in the decision of trial judges on matters that are of practice and procedure, rather than clogging up the appellate courts with decisions that are more apt to be dealt with by the trial judge. Kirby P observed this trend in Wentworth v Rogers (No. 3) (supra) at 644: "…since 1946, there has been an increasing realisation of the public costs which are involved in litigation and the public interest that necessitates, particularly in the multitude of practice decisions that must daily be made in the courts, a high respect for finality. Without this, other litigants will be delayed and the burden on judges and the appellate process will be unacceptably increased, with consequent public expense.

The provision, contained in the Supreme Court Act 1970, s101(2)(c), necessitating leave in a case such as the present, amounts to a legislative recognition of these considerations." 18 To achieve this more efficient use of court time, leave provisions such as s101(2)(c) have been construed so that the bar to achieve leave has been set considerably higher than for substantive issues. Kirby P at 644 again: "Accordingly, it is normally necessary for a claimant for such leave to show something more than that the appeal court would, if exercising its discretion afresh, have come to a conclusion different to that reached by the trial judge. Some error of principle in the exercise of the discretion, a consideration of irrelevant matters or some other manifest mistake is needed to take the case out of the ordinary situation in which, wherever a discretion is to be exercised, minds may differ on the result: cf Maiden v Maiden (1909) 7 CLR 727 at 742; McCauley v McCauley (1910) 10 CLR 434 at 455."

Further, Priestley JA at 651: "One of the purposes of this provision [s101(2)(c)] is to ensure that costs questions, important though they frequently are to litigants not only cannot be further litigated by a party as of right on appeal, but also may only be allowed to be further litigated by appeal if the Court of Appeal thinks there is some good reason, over and above the Court's own opinion of what would have been the best costs order in the particular circumstances, for doing so." 19 Similarly, Clarke J in Parker v NRMA (1993) 11 ACSR 370 at 401 stated on a leave application under s101(2)(c): "In a case such as the present it would seem to me appropriate to determine whether an error has been demonstrated of the nature discussed by Jordan CJ in Re the Will of Gilbert 46 SR 318 at 323 before determining whether to grant leave. I say that because I do not think that it would be appropriate to grant leave unless the court were disposed to grant the appeal. (See generally Wentworth v Rogers (1986) 6 NSWLR 647, particularly at 651.) I can detect no specific error of the type discussed by Jordan CJ in the judgment under appeal. This case is one in which the trial judge was placed in a peculiarly advantaged position in determining an appropriate costs order. That is because it was he who witnessed the whole of the trial and observed the tactical shifts which took place during its course. He would have appreciated far better than this court could the nuances involved in the trial and, having regard to these advantages, I would not interfere unless a case of error had been dearly made out. I have already indicated that there has been no demonstrated error and in these circumstances I would not interfere with his Honour's order. Although it is true that Parker did not bring the proceedings for his own personal benefit it seems to me that his Honour's order took account of the fact that he was entitled to more than party and party costs for the 1987 proceedings." 20 Isaacs J in Maiden v Maiden (1908) 7 CLR 727 anticipated this stringent approach to reviewing cost orders over 90 years ago: "As to costs, it is clear that the discretion of the primary tribunal cannot be interfered with so long as it is not caused by an erroneous view of the law or a misapprehension of the facts. In the present instance there was either one or the other, perhaps both. The order is materially varied, and the matter of costs is open to this Court." (at 742) 21 See also: Jackamarra v Krakouer (1998) 195 CLR 516; Tamworth Base Hospital v Durant [2000] ACL Rep 280 NSW 8 per Handley JA; Angliss v Urquhart [2002] ACL Rep 325 NSW 13; John Fairfax Publications v Rivkin [1999] NSWCA 164; NRMA Insurance Ltd v AW Edwards Pty Ltd (1995) 11 BCL 200; Bank of New Zealand v Spedley Securities Ltd (in liq) (1992) 27 NSWLR 91; M & L Watson Pty Ltd (t/as BBR Design) v Rilsung Pty Ltd [2003] NSWCA 36. 22 It is clear from the authorities that something beyond a mere difference in opinion with the trial judge must be found before a court of appeal grants leave to re-agitate cost determinations, so classically an area where judicial minds may legitimately differ. 23 In the present case no figure seems to have been put forward as to the amount of costs at stake. However, the relatively small nature of the proceedings, and their interlocutory character would indicate that the figures would be low. The principle in the authorities of frugality in granting leave, stemming from Gilbert, thus attaches to the present matter. 24 The appellant has the onus of showing a manifest error on the part of the trial judge and, moreover, of the kind warranting appellate intervention in an area of discretion concerning practice and procedure. That has not been demonstrated. Even though in CA 40137/03 the trial judge concededly misapprehended the identity of the relevant Local Environment Plan, that error, as the outcome of the main appeal affirms, was of no consequence in terms of the conclusion reached by the trial judge, quoted below: "The applicant failed to obtain interlocutory relief and was almost certain to have failed in obtaining a declaration that the use of premises as a real estate agency was invalid. Accordingly the Court will order that the applicant pay the council's costs in proceedings 40120 of 2000."

CONCLUSION 25 Each of the three Leaves to Appeal should be denied with costs against the claimant in each case. I would so order. 26 IPP JA: I agree with Santow JA **********

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