Houston v State of New South Wales

Federal Court of Australia|2020-08-05|Before: Jagot J

The application for leave to appeal be dismissed.
The applicant pay the respondent's costs as agreed or taxed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

JAGOT J: 1 These reasons for judgment concern an application for leave to appeal against the primary judge's refusal to make a maximum costs order under r 40.51 of the Federal Court Rules 2011 (Cth). 2 Rule 40.51(1) provides that: A party may apply to the Court for an order specifying the maximum costs as between party and party that may be recovered for the proceeding. 3 The maximum costs order which the applicant sought by an interlocutory application filed on 27 February 2020 was that "the maximum party and party costs which the applicant and respondent could recover from the other is nil". The primary judge dismissed the interlocutory application with costs for reasons given in Houston v State of New South Wales [2020] FCA 502. 4 I have decided that the application for leave to appeal must be refused as there is not sufficient doubt about the correctness of the primary judge's decision such as to warrant the reconsideration of the matter by the appellate court. My reasons follows.

Grounds of the application 5 Ground 1 alleges that the primary judge misapplied the law by concluding that the litigation could not properly be described as public interest litigation. The ground is supported by numerous particulars. 6 Ground 2 alleges that the primary judge took into account an irrelevant consideration and misapplied the law. The irrelevant consideration was said to be criminal proceedings against the applicant in the Land and Environment Court of New South Wales (the LEC) and the principle of not fragmenting criminal proceedings. 7 Ground 3 alleges that the primary judge failed to take into account a relevant consideration and misapplied the law. The relevant consideration was said to be that the constitutional validity of the impugned legislation was not capable of resolution in the LEC and that the issues being brought forward in this proceeding were an exception to the fragmentation principle. Further, it was said that the primary judge failed to consider that if a maximum costs order is not made the applicant will probably discontinue this proceeding and will be acting reasonably in doing so. Further again, it was said that the primary judge failed to consider whether the novelty and public importance of the questions raised by the proceeding properly occasioned a departure from the indemnity rule. 8 Ground 4 alleges that the primary judge denied the applicant procedural fairness. It was said that the primary judge incorrectly inferred that the only costs order acceptable to the applicant was one with a nil amount without "putting that assumption to the applicant". It was also said the primary judge took into account the related criminal proceedings in the LEC and weighed this as a factor adverse to the applicant "without putting the factor to the parties for submissions and/or ascertaining facts and circumstances which are relevant to such a consideration and which weigh in the applicant's favour". Numerous particulars of these facts and circumstances were given. Further, it was said that the circumstances of the case gave rise to a reasonable apprehension of bias on the part of the primary judge as he: (1) approached the task of making an assessment of the prospects of the proceeding with too high a degree of certainty about the ultimate outcome of the proceeding; (2) based his conclusion as to prospects too much on an inner judicial conviction derived from his knowledge and understanding of the litigation in Spencer v Commonwealth [2018] FCAFC 17; 262 FCR 344 (Spencer); and (3) failed to demonstrate to the requisite standard a mind capable of persuasion as to what the applicant had had the brief opportunity to say, in truncated outlines of submissions, in the absence of an oral hearing.

The primary judge's reasoning 9 The interlocutory application was determined on the papers, a course to which the applicant neither consented nor objected. The interlocutory application was supported and opposed by affidavit evidence. The parties filed written submissions in chief and reply in support of their competing positions. In its written submissions in chief the respondent proposed that if the Court was inclined to make a maximum costs order then it should exclude costs incurred to date and fix the maximum costs in the sum of $250,000. The applicant did not in its written submissions in chief or reply identify any possible alternative to the nil maximum costs order sought in the interlocutory application. 10 The primary judge recorded the background facts as follows: 4 On 27 June 2019, the applicant commenced the proceedings in the High Court of Australia by way of a Summons and Statement of Claim dated 26 June 2019. The proceedings were remitted to the Federal Court by a consent order dated 3 September 2019. At that time, the Commonwealth of Australia and the State of New South Wales were named as the first and second defendant respectively. 5 On 25 October 2019, the applicant filed an amended statement of claim. On 1 November 2019, the applicant filed a Concise Statement. 6 On 5 December 2019, the Court ordered by consent that the Commonwealth of Australia be removed as a party to the proceeding. 7 On 6 December 2019, the second respondent filed a defence and on 13 December 2019 it filed a Concise Statement in response. 8 On 4 February 2020, the Court ordered that, within 14 days, the applicant was to file and serve any proposed further amended statement of claim (proposed FASOC). 9 On 20 February 2020, the applicant provided a proposed FASOC which contained substantial amendments to the earlier pleadings. As noted, on 27 February 2020 the applicant filed the interlocutory application seeking a maximum costs order. 10 The parties provided written outlines of submissions, including reply submissions, which the Court has taken into account in determining the matter on the papers, a course of action to which the State consented to and the applicant did not oppose. 11 The applicant brings these proceedings in circumstances where he is being prosecuted in the Land and Environment Court for alleged offences against s 12 of the Native Vegetation Act 2003 (NSW) (NV Act). Those proceedings were commenced on 18 December 2018. It is alleged that the applicant cleared or authorised the clearing of native vegetation otherwise than in accordance with a development consent or a property vegetation plan, as required by the NV Act. The applicant is liable to penalties up to 10,000 penalty points. He is also liable under s 38 of the NV Act to conduct remedial work requiring him inter alia to plant and maintain new native vegetation or, alternatively, pay the State for performing such work. 12 It is against that background that the applicant seeks declarations in this Court that the NV Act and other legislation which is relevant to the criminal proceedings are inoperative or wholly invalid. That other legislation is cl 58 of the Biodiversity Conservation (Saving and Transitional) Regulation 2017 (NSW) and Pt 5A of the Local Land Services Act 2013 (NSW). It is unnecessary for the purposes of the present interlocutory application to explain how that other legislation is relevant. 13 In broad outline, the applicant contends that the relevant legislation is inoperative or wholly invalid because it has a disproportionate and/or discriminatory effect on his farming operations. He contends that in order to give effect to the Kyoto Protocol, the Commonwealth has by a series of both formal and informal arrangements and a mutual understanding with the States and Territories sought to implement the Commonwealth's obligations under the Kyoto Protocol by a "net zero broadscale land clearing" policy, with the effect that the States and Territories are responsible for introducing legislation to limit broadscale land clearing. He further contends that in these circumstances the Commonwealth and/or the State of NSW was required to provide just terms compensation for any identifiable and measurable advantage derived by either of them by the operation of the impugned legislation. The applicant contends that there is implied in the text and structure of the Constitution that the Commonwealth will not employ any power other than the legislative power of the Commonwealth to give effect to an acquisition of property in the Commonwealth other than on just terms (the implied just terms guarantee). The implied just terms guarantee is said to condition the exercise of power under ss 61 and 96 of the Constitution. It is further contended that the guarantee requires that a law of a State which acquires property for constitutional purposes is not valid if it does not provide for just terms and by its terms, operation or effect the law imposes a disproportionate or discriminatory burden connected to the use of properties. 14 In his reply submissions, Mr Houston stated that his case "will answer the questions raised by ICM Agriculture v Commonwealth and expounded by Hayne, Crennan Kiefel and Bell JJ in Spencer v Commonwealth" (footnotes omitted). He contends that the existence of a "scheme or device" between the States and the Commonwealth was not fully resolved in the extensive Spencer litigation (Spencer v Commonwealth [2018] FCAFC 17; 262 FCR 344). In particular, he contends that there has been no factual exploration of the agreements, arrangement or understandings between the Commonwealth and State which led to the 1 January 1990 baseline date in the impugned legislation. Mr Houston added that these matters have not been resolved in the particular context in which he now advances his claims, which he described as follows (without alteration): … a rights based approach to s 51(xxxi), in accordance with modern Australian approach to certain foundational freedoms or constitutional limitations (i.e. consistent with the modern approach to s 92, the implied freedom of political communication and the implied right to vote). Such an approach will enable s 51(xxxi) to be considered in what the Applicant contends, is the appropriate constitution or context, as revealed, by the Convention debates. 15 Mr Houston candidly acknowledged that his "rights based" approach to s 51(xxxi) is "novel" and "has not been prosecuted in a previous case". 11 After reciting r 40.51 the primary judge noted at [17] that: There was substantial agreement between the parties as to the relevant principles guiding the exercise of the Court's discretion under r 40.51. The discretion is to be exercised judicially, having regard to all the relevant circumstances. Those circumstances include the nature of the relief sought, the complexity of the litigation and the interests of the parties in both prosecuting and defending the litigation, whether the applicant's claims are reasonably arguable, whether a party would otherwise be forced to abandon a proceeding if such an order were not made, whether there was a public interest element to the proceeding, the costs which are likely to be incurred in the proceeding, the timing of the maximum costs application and whether the party opposing the making of the orders has been uncooperative and/or delayed the proceedings. 12 At [18] the primary judge noted another relevant factor being that: … the normal rule in civil litigation that costs are awarded to the successful party, not to punish the unsuccessful party but rather to compensate the successful party against the expense to which it has been put by reason of the legal proceedings. It is well settled that this normal rule can be displaced in an appropriate case. The applicant's application for a maximum costs order effectively seeks to displace the normal rule at this relatively early stage of the proceeding, rather than defer the matter of costs to when the proceeding has been determined. 13 The primary judge also noted at [19] that he agreed with the observations in Hanisch v Strive Pty Ltd [1997] FCA 303; 74 FCR 384 at 387 that: The principal object of O 62A is to arm the Court with power to limit the exposure to costs of parties engaged in litigation in the Federal Court which involves less complex issues and is concerned with the recovery of moderate amounts of money, although it may be appropriate for an order to be made under O 62A in other cases… 14 At [19] the primary judge also said that he agreed with Beach J's observations in McKay Super Solutions Pty Ltd (Trustee) v Bellamy's Australia Ltd (No 2) [2019] FCA 215 at [74] that "if the proceeding is complex forensically and also lengthy then this may militate against the making of such an order". 15 In respect of the consideration of public interest litigation the primary judge said: (1) it may be accepted that persons other than the applicant may have an interest in whether or not the relevant legislation is valid, [but] that of itself is insufficient to characterise the matter as involving public interest litigation: [27]; (2) it cannot be said that the applicant has no private interest in the proceeding. He currently faces criminal prosecution and, if his proceeding here is successful, he would avoid the financial consequences associated with prospective fines, remediation orders and/or conservation agreements that would follow from a conviction: [28]; and (3) the relevant question is whether there is a public interest in litigating what can reasonably be described as a broad and novel constitutional challenge to the impugned State legislation, relying not only on an alleged limitation on Commonwealth power in the Constitution, but also on various alleged acts and arrangements between the Commonwealth and the State. This is in circumstances where the Commonwealth is no longer a party to the litigation and where it has to be said there is a substantial overlap with issues which have been heard and determined in the earlier Spencer litigation: [29]. 16 The primary judge concluded at [30] that: I am not persuaded that, having regard to Mr Houston's self-interest because of the criminal proceedings pending in the Land and Environment Court, together with the other matters described above, this litigation can properly be described as public interest litigation. 17 In respect of the consideration of the nature of the relief sought the primary judge said: (1) the only relief sought in the proposed FASOC [further amended statement of claim] is a declaration that the impugned legislation is "inoperative or wholly invalid": [31]; and (2) however, even in the absence of a claim for damages, the applicant has a strong self interest in the matter: [31]. 18 In respect of the consideration of the complexity of the litigation the primary judge said: (1) the Court's power to order a maximum costs order is generally directed to proceedings which are not complex or lengthy: [32]; (2) this proceeding is not of that nature: [32]; (3) the primary judge could not accept the applicant's estimate of a hearing of only two to three days and thought the State's estimate of a five day hearing was more reasonable having regard to the complexity of the constitutional issues: [32]; and (4) the experience and history of the Spencer litigation highlights the complexity of the issues which Mr Houston wishes to raise and the likely time required to hear and determine those issues: [32]. 19 The primary judge concluded at [32] that these matters did not favour the applicant's application. 20 In respect of the consideration of the interests of the parties in both prosecuting and defending the litigation the primary judge said: (1) the applicant has strong personal interest in bringing the litigation having regard to the criminal proceedings in the LEC: [33]; (2) the State has no alternative but to defend the proceeding: [33]; (3) he agreed with the State's position that the litigation cannot objectively be described as public interest litigation which is a matter of objective assessment rather than the applicant's subjective views: [34]; and (4) the State's obligations as a model litigant do not prevent it from taking an appropriate role in litigation, including opposing a maximum costs order on legitimate grounds, as has occurred here: [35]. 21 In respect of the consideration whether the applicant's claims are reasonably arguable the primary judge said at [36]: (1) for the purposes of the application he was prepared to accept the applicant's claims are at least arguable but they do not appear to be very strong having regard to the Spencer litigation; and (2) the applicant will need to persuade the Court how the Spencer litigation is distinguishable. 22 In respect of the consideration whether a party would otherwise be forced to abandon a proceeding if such an order were not made the primary judge said at [37] that: (1) in his affidavit the applicant said if he did not obtain the order "we will likely walk away from this litigation"; (2) this falls short of an unambiguous statement that he would be forced to abandon his claim in this Court and his submissions take the matter no further; and (3) all of the submissions fall short of an unambiguous statement that the applicant would abandon the proceeding if the maximum costs order was not made. 23 In respect of the consideration of the costs likely to be incurred in the proceeding the primary judge said: (1) the timing of the application (early in the proceeding) makes it difficult to estimate with any confidence what are the likely costs of the proceeding: [38]; (2) assuming the hearing takes five days the costs are likely to be significant: [38]; (3) the applicant has made no attempt to assess what the costs of the proceeding is likely to be. The State assessed its costs for attending the five day hearing as approximately $45,000 and allowance would need to be made for discovery, preparing evidence and submissions, interlocutory matters and preparation for the hearing: [39]; and (4) there is considerable force in the State's submission that, in view of the uncertainty regarding total costs, the preferable course is to be deal with the issue of costs retrospectively rather than prospectively: [40]. 24 In respect of the consideration of the timing of the application the primary judge said at [41] that the applicant sought a maximum costs order at an early stage of the proceeding, which weighs in his favour but this still needs to be balanced against other relevant matters. 25 In respect of the consideration of whether the party opposing the making of the order has been uncooperative and/or has delayed the proceedings the primary judge said at [42] that there is no suggestion that the State has been uncooperative or has delayed the proceedings. 26 In respect of the consideration of the relevance of the criminal proceedings pending in the LEC the primary judge said at [43]: The parallel proceedings in the Land and Environment Court have obvious relevance to this Court's consideration of Mr Houston's interlocutory application. They are not only relevant in demonstrating Mr Houston's strong personal interest in having the impugned legislation which underpins those criminal proceedings set aside, but it is also well established that the Court needs to wary of encouraging the fragmentation of criminal proceedings which are on foot (see, for example, the observations of the Full Court in Flanagan v Commissioner of the Australian Federal Police (1996) 60 FCR 149 at 187 ff and the cases cited therein per Beaumont, Ryan and Lindgren JJ). 27 At [44] the primary judge said: It is notable that at no stage has Mr Houston indicated that he would be willing to entertain a maximum costs order other than one which specified a nil amount. This is all the more notable because the State in its outline of submissions in chief raised the possibility that, if the Court was inclined to make a maximum costs order, it should be set at a maximum of say $250,000 above the costs which the State had incurred to date. Mr Houston did not respond to that suggestion in his reply submissions. The Court infers that Mr Houston's position is that the only costs order he seeks is one with a nil amount. 28 At [45] the primary judge said: For the reasons given above, I am not persuaded that this is an appropriate case to make such an order. Mr Houston's interlocutory application will be dismissed, with costs.

Consideration 29 I reject the applicant's submission that House v The King [1936] HCA 40; 55 CLR 499 (House v The King) would not apply to the appeal should leave be granted. The fact that the appellate Court may be in as good a position as the primary judge to decide the application is not determinative of the application of the principles in House v The King. Those principles would apply to the proposed appeal because the primary judge was making a discretionary decision based on broad evaluative considerations about which reasonable minds may differ. The question whether there is sufficient doubt about the correctness of the primary judge's decision is to be assessed in this context and having regard to the fact that particular caution is to be exercised when having regard to challenges to decisions of practice and procedure by trial judges.

Ground 1 30 Contrary to the submissions for the applicant it cannot be said that the primary judge failed to consider the "palpable legal and regulatory significance of the public law questions raised by the proceedings". His Honour was plainly aware of those considerations and took them into account as his reasons at [11]-[15] and [22]-[30] disclose. The fact that the primary judge was not persuaded to characterise the litigation as public interest litigation does not mean that he failed to consider the questions raised by the litigation. Nor can it be said that his Honour's approach to the novelty of the applicant's arguments involved some failure of consideration or legal error of a kind sufficient to raise doubt about the conclusion that the decision was one of practice and procedure and which was reasonably open to the primary judge in all of the circumstances. I would not infer that the primary judge failed to consider or give appropriate weight to the evidence of the interest of farmers more generally in the validity of the impugned legislation. His Honour referred to the affidavits at [3] and it would not be inferred that he failed to have regard to that material in his assessment of the application. The primary judge was not bound to refer to every aspect of the evidence. No inference can be drawn that his Honour failed to consider that the applicant's case is a vehicle for other farmers who feel disproportionately impacted by the impugned legislation. The primary judge knew well that "persons other than the applicant may have an interest in whether or not the relevant legislation is valid", as he recorded at [27]. It was not necessary for the primary judge to give greater details about the nature of these interests or the depths of the conviction held by the applicant and others about the unfairness of the impugned legislation to discharge his obligations to consider matters relevant to the exercise of the discretion. 31 Nor can it fairly be said that the primary judge took "a narrow, one-sided approach to the question of the parties' interests". There was no unfairness in the primary judge placing weight on the fact that this proceeding involved to a significant degree the applicant's personal interests. This inference was obvious on the material before the primary judge. Contrary to the applicant's submissions, the primary judge did not assume that this fact precluded the litigation from being public interest litigation as if a personal interest and the public interest were mutually exclusive considerations but was entitled to give the fact of the applicant's undoubted personal interest weight in his overall assessment of the character of the litigation. The primary judge was also not bound to consider the State's financial interest in defending the litigation. 32 The task of characterising the litigation as public interest litigation or not was a broadly evaluative one for the primary judge alone to undertake. Unless some error of principle is apparent, it is not for an appellate court to interfere even if the appellate court might characterise the litigation differently. The fact that the applicant strongly believes that other factors should have been given more, indeed determinative, weight, when the primary judge was of a different view, does not expose any error of principle. Thus it is not to the point for the applicant to reiterate the allegedly high political, social, economic and environmental significance of the proceeding. His Honour was well able to assess the relevance of the nature of the proceeding and decide for himself, as he was entitled to do, how that nature weighed in the balance of all relevant considerations to the making of a maximum costs order as sought by the applicant. The strength of the applicant's conviction that a different view of the nature of the litigation should have been reached, and the multiplicity of ways in which the applicant was able to express this contention in written and oral submissions, is not indicative of any error of principle by the primary judge. Once this is recognised the applicant's arguments that the issues raised by the proceeding were such as to displace the ordinary compensatory principle which underlies the usual order as to costs fall away. The primary judge was not so satisfied and the conclusion he reached was reasonably open on the material before him. 33 For the same reasons the contention that the primary judge failed to take into account the "troubled regulatory history of the impugned legislation" and "the decade long Spencer litigation" and the "the tragic murder of a Departmental compliance officer by a farmer and continuing mental health impacts on farmers of the regulations" cannot assist the applicant. The primary judge plainly did consider the Spencer litigation and otherwise, as I have said, was not bound to mention each and every piece of evidence on which the applicant relied. Nor, by its mere mention in an affidavit, did each and every piece of evidence become a "relevant consideration" in the sense that the primary judge's decision is liable to be set aside for error of principle if the primary judge in fact failed to take that matter into account. In any event, the mere fact that not every piece of the evidence is mentioned in his Honour's reasons, which concern the exercise of a discretion about costs, a matter of practice and procedure, does not support any inference of a failure of consideration. 34 The applicant has not established any error of principle in the primary judge's approach to the characterisation of this proceeding as not being public interest litigation. The nature of the proceeding, involving novel issues which his Honour considered did not appear on their face to be very strongly arguable, taken with the undoubted strong private interest of the applicant in the litigation, led the primary judge to reject the characterisation of the litigation as public interest litigation. The applicant has not identified any error of principle in this regard. The contentions in ground 1 are not such as to raise sufficient doubt about the correctness of the primary judge's decision (in the sense that the decision was one reasonably open on the material before the primary judge) so as to justify the grant of leave to appeal.

Ground 2 35 Contrary to ground 2 there is no basis for the contention that the primary judge took into account an irrelevant consideration and misapplied the law. The LEC proceedings were a relevant consideration because they showed the applicant's strong personal interest in this proceeding, just as the primary judge said at [43]. The primary judge did not suggest that this Court was exercising supervisory jurisdiction over the LEC. Nor was the primary judge purporting to say anything about the conduct of the LEC proceedings. His point was that if the applicant succeeded in this proceeding the legislative foundation of the LEC proceeding would fall away, thus showing the applicant's personal interest in this proceeding. Otherwise the suggestion that the primary judge failed to consider the fact that the invalidating of the impugned legislation would invalidate the criminal prosecution in the LEC proceeding is unsustainable. That is the very point the primary judge was relying upon to demonstrate the applicant's strong personal interest in this proceeding. As to the fragmentation of the criminal proceeding, the principle as stated by the primary judge is correct. It was open to his Honour to take that principle into account in deciding whether or not to exercise his discretion to make a maximum costs order in the applicant's favour as sought. The applicant has not identified why such a consideration would be prohibited from being taken into account in the requisite sense such as to arguably vitiate the primary judge's exercise of discretion. Nor has the applicant established why it was necessary for his Honour to consider details about the LEC proceedings which neither party had placed before him. In that regard, it must be inferred that the primary judge was well aware of what the material before him did disclose, that the LEC proceedings had not progressed even to entry of a plea pending resolution of this proceeding. Contrary to the applicant's submissions, it could not be inferred that the primary judge had failed to consider this fact as it underlies his observations about the fragmentation of the LEC proceedings. Otherwise, as noted below, the applicant's contention based on the LEC not having jurisdiction to decide the issues in this proceeding is not persuasive and, as such, the suggestion that the primary judge erred in having regard to the issue of fragmentation of the LEC proceeding cannot be sustained. 36 Accordingly, the arguments in support of ground 2 do not raise sufficient doubt about the correctness of the primary judge's decision such as to warrant reconsideration of the matter by an appellate court.

Ground 3 37 The applicant has no cogent argument to support the contention that the primary judge failed to take into account relevant considerations and misapplied the law. The primary judge was aware of the relationship between the LEC proceedings and this proceeding as disclosed by his reasons at [11], [12], [29], [30], [31], [33] and [43]. His Honour took that relationship into account in the exercise of his discretion. His Honour was not bound to advert to the applicant's (seemingly, current only) contention that the constitutional issues could not be resolved in the LEC proceedings. The contention is of dubious validity. As the respondent submitted, the ancillary jurisdiction of the LEC under s 16(1A) of the Land and Environment Court Act 1979 (NSW) together with s 39(2) of the Judiciary Act 1903 (Cth) extends to the determination of constitutional issues that form an essential step in the course of determining an issue within the LEC's jurisdiction. In any event, it is not apparent why the primary judge was bound to take into account this contention even if it were correct. Nor is it apparent why the primary judge was bound to take into account the applicant's contention that questions of law in this proceeding had been brought forward at an appropriate time in the LEC proceedings and could be viewed as an exception to the fragmentation principle. None of these matters, in my view, are arguably mandatory relevant considerations such as to indicate an error of principle by the primary judge in the exercise of his discretion. 38 As to the contention that the Court was bound to consider that the applicant would probably discontinue the proceeding and would be acting reasonably in doing so, the fact is the primary judge did take into account the applicant's evidence as to the likelihood of his abandoning the proceeding if the maximum costs order was not made. So much is apparent from [37] of his Honour's reasons. The primary judge, in my view, could not be said to have committed any error of principle by not adverting to the contention of the applicant that it would also have been reasonable for him to abandon the proceeding in this circumstance. The simple fact is that the primary judge weighed the applicant's evidence and submissions in the terms in which each was put and found both wanting in terms of persuasive weight to exercise the discretion in the applicant's favour. The primary judge did not elevate the consideration to a prerequisite to the making of a maximum costs order. He merely characterised the evidence - accurately - as falling short of an unambiguous statement that the applicant would abandon the proceeding if the maximum costs order was not made and then weighed that in the balance along with all of the other relevant considerations. His Honour was entitled to give weight to this factor as he saw fit. 39 As to the contention that the primary judge failed to consider whether the novelty and public importance of the questions raised by the proceeding properly occasioned a departure from the indemnity rule in the circumstances of this case, the primary judge plainly considered this very matter. The applicant's real complaint is that the primary judge did not consider that the relevant factors justified a departure from the ordinary position with respect to costs. This was a matter for the primary judge alone to decide and his conclusion is unable to be impugned absent some error of principle. No such error has been identified in ground 3. More to the point, the arguments in support of ground 3 do not raise sufficient doubt about the correctness of the primary judge's decision such as to warrant a grant of leave to appeal.

Ground 4 40 In respect of the contention that the primary judge denied the applicant procedural fairness because at [44] the primary judge inferred that the only costs order acceptable to the applicant was one with a nil amount without putting that assumption to the applicant is misconceived. The applicant's interlocutory application sought a maximum costs order of a nil amount. The respondent in its written submissions opposed the order and in the alternative sought an order for a maximum costs order in the sum of $250,000. In his written submissions in reply the applicant did not propose any alternative sum for the maximum costs order. In these circumstances the primary judge was entitled to infer that the only order that the applicant sought was a maximum costs order in a nil amount. The obligations of procedural fairness did not oblige his Honour to put this inference to the applicant. The applicant had an opportunity to put written submissions in chief and reply. His Honour was entitled to rely on those written submissions as accurately reflecting the applicant's position. It is not the law that a judge is required to give a party notice of the inferences from the evidence the judge might draw. The applicant had an opportunity to put such material as the applicant saw fit before the primary judge and the primary judge was entitled to draw such inferences from that material as were reasonably open. The inference the primary judge drew at [44] about the applicant's position was not only reasonably open, it was the only logically available inference on the material. 41 The applicant sought to make something of the fact that the matter had been determined on the papers and suggested that in an oral hearing the applicant's willingness to obtain a maximum costs order in a sum greater than nil would have emerged. The applicant did not object to the matter being heard on the papers and cannot now complain of the lack of an oral hearing. In any event, the suggestion involves pure speculation. The primary judge was not bound to ask the applicant if he had an alternative positon during an oral hearing. Just as it was a matter for the applicant to raise any alternative position in his written submissions (which he did not do), equally it would have been a matter for the applicant to raise any alternative position in any oral submissions. To suggest the applicant would have done so in oral submissions when he did not do so in written submissions is nothing more than speculation. It does not found any denial of procedural fairness. The applicant had the opportunity to put his case. Procedural fairness did not require more than this. The primary judge was not bound to seek further submissions from the parties when they had joined issue in the submissions as filed. 42 In respect of the contention that the primary judge took into account the LEC proceedings and weighed this factor adversely to the applicant without putting the factor to the parties for submissions and/or ascertaining facts and circumstances which are relevant to such a consideration and weigh in the applicant's favour, much the same response may be given. The parties had an opportunity to put relevant material before the primary judge including about the LEC proceedings. The material before the primary judge about the LEC proceeding is reflected in his reasons for judgment. The primary judge was not bound by the requirements of procedural fairness to seek more information from the applicant about details of the LEC proceedings as the applicant now proposes. Had the applicant wished to put that material before the primary judge he could have done so. Not having done so the applicant cannot complain that his Honour did not refer to the material. 43 The primary judge was entitled to take into account the LEC proceedings and weigh their relevance as he saw fit. In so doing the primary judge did not deny the applicant procedural fairness as the applicant had ample opportunity to place material before the primary judge about the LEC proceedings and make submissions relating to those proceedings which opportunity the applicant took. The applicant's complaint is nothing more than that the primary judge having decided against the applicant, the applicant now wishes that additional material had been placed before the primary judge about the LEC proceedings. This wish does not found any denial of procedural fairness. 44 The contention of an apprehension of bias on the part of the primary judge is without apparent merit. The primary judge assumed the applicant's claims were at least arguable: [36]. His Honour's further observations that the claims did not appear to be very strong having regard to the Spencer litigation and that the applicant would need to distinguish Spencer are not such as might lead a fair minded lay observer to reasonably apprehend that his Honour might not bring a mind open to persuasion to the substantive proceeding. The comments about the case not appearing very strong are expressed in tentative terms. The primary judge was plainly dealing with the strength of the claims on their face only and without regard to the evidence or arguments as they might ultimately transpire. The statement that the applicant would need to distinguish Spencer was nothing more than a correct observation of a task that would fall to the applicant in the course of the litigation given the operation of the doctrine of precedent in our judicial system about which the fair minded lay observer would have to be taken to know. The primary judge was entitled to make these preliminary assessments for the purpose of the task at hand - deciding whether to exercise a discretion to make a maximum costs order as the applicant sought. They do not show any degree of certainty, let alone a high degree of certainty, about the substance of the proceeding. Nor can it be said that the judgment discloses any "inner judicial conviction". This is inconsistent with his Honour's preparedness to accept that the applicant's claims were at least arguable. His Honour was entitled to make a rough and ready assessment of the applicant's prospects beyond this from the face of the claims assessed against the background of the Spencer litigation without in any way giving rise to a reasonable apprehension of bias. The very fact that his Honour stated that the Court would need to be persuaded that Spencer is distinguishable discloses to the reasonable lay person that his Honour's mind was open to persuasion that Spencer was indeed distinguishable. If it had been otherwise the remark would not have been made in those terms. 45 The arguments in support of ground 4 do not give rise to sufficient doubt about the correctness of the primary judge's decision such as to warrant the grant of leave to appeal.

Conclusions 46 The applicant has failed to establish that the primary judge's decision is attended by sufficient doubt to warrant its reconsideration by the appellate court. The application for leave to appeal should be dismissed with costs. I certify that the preceding forty-six (46) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jagot.

Native Vegetation Act 2003(NSW)

Biodiversity Conservation (Saving and Transitional) Regulation 2017(NSW)

Federal Court Rules 2011(Cth)rr 40.51, 40.51(1)

Judiciary Act 1903(Cth)s 39(2)

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