190 LGERA 119
McGovern v Ku-ring-gai Council [2008] NSWCA 209
Source
Original judgment source is linked above.
Catchwords
190 LGERA 119
McGovern v Ku-ring-gai Council [2008] NSWCA 209
Judgment (4 paragraphs)
[1]
Solicitors:
Robert Balzola & Associates (Legal) (Applicant)
Marsdens Law Group (First Respondent)
Department of Planning and Environment (Second Respondent)
Mitry Lawyers (Third and Fourth Respondents)
No appearance (Fifth Respondent)
File Number(s): 40626 of 2013
[2]
ex tempore Judgment
By notice of motion filed on 27 October 2015, the applicant seeks to set aside an order for costs made against it on 7 August last. That order was made by me when I delivered judgment dismissing the applicant's principal proceedings (Hoxton Park Residents Action Group Inc v Liverpool City Council (No 2) [2015] NSWLEC 125) (the principal judgment). Those proceedings involved a challenge to the validity of a development consent for a school granted by the second respondent, the Sydney West Joint Regional Planning Panel, on 28 February 2013.
Although acknowledging that it was unsuccessful in the principal proceedings, the applicant contends that no order for costs should be made against it on the basis that the proceedings were instituted and maintained in the public interest. In order to address that contention, it is first necessary to record the steps taken by the applicant following delivery of my judgment, as well as the procedural history of the present notice of motion.
Hoxton Park Residents Action Group Inc. (No 3) v Liverpool City Council [2015] NSWLEC 198 | Case summary | Zoe
The summons instituting the proceedings was, by leave, amended on two occasions. Common to all versions of the summons were two orders sought relating to costs. The first was a "declaration that this is a public interest matter" (sic) and the second was what was described as a protective costs order pursuant to r 42.4 of the Uniform Civil Procedure Rules 2005 (UCPR). As I recorded in my principal judgment at [159], no interlocutory application was ever made by the applicant for the second of those two orders and no evidence was adduced nor submission made in support of either order when the proceedings were heard by me. Clearly, it is now too late for any consideration to be given to a protective costs order pursuant to r 42.4 of the UCPR.
Having recorded those matters in my principal judgment, but acknowledging that the question of costs had not been addressed, I stated at [160] that as the applicant had been unsuccessful on each ground of challenge argued by it, there was no reason why the usual order that costs follow the event should not be made. However, the order then made by me afforded an opportunity for the applicant to argue the question should it be advised so to do. As a consequence, I included in the orders made on 7 August the following order:
"2. The applicant is to pay the respondents' costs of the proceedings unless by 5.00pm on 21 August 2015 the applicant notifies the respondents and my associate of the terms of any different costs order that it seeks."
At [161] I stated that if such notice is given, I would then give directions as to the manner in which the question of costs should be argued and determined.
The applicant neither notified the respondents nor my Associate by 21 August of any different costs order that it sought. However, by letter dated 30 September 2015, Robert Balzola, the applicant's solicitor, stated that he was notifying the respondents of the proposed terms of a different order as to costs from that made in Order 2 of the orders made on 7 August. He acknowledged the failure to give that notification in the time required by that Order, explaining that his failure was due to personal difficulties under which he was working. He foreshadowed seeking the consent of the respondents to set aside Order 2, to the intent that each party should bear its own costs or alternatively that he would seek leave to file a notice of motion for "(1) Protective Costs Order (2) Declaratory relief that this is a public interest matter and (3) Each party to pay their own costs".
Mr Balzola's letter was addressed to the Associate of Biscoe J. Apparently he had overlooked the fact that the Order was one made by me. However, his letter (received by email) was referred to my Associate who responded that same day, stating that in light of the terms of Order 2, Mr Balzola should make such application as he considered appropriate in order to pursue his application.
Notwithstanding that response on 30 September, it was not until 27 October 2015 that the present notice of motion was filed. It was supported by a short affidavit sworn by Mr Balzola, the substance of which was to explain that the reason for the delay in filing the motion was to be attributed to matters personal to him. Difficulties occasioned by a family bereavement in 2013 had caused him not only to overlook filing an interlocutory application for a protective costs order shortly after the proceedings were commenced but also caused him to overlook making an application for a different costs order once my judgment was delivered and orders made on 7 August.
The present notice of motion was returnable on 6 November 2015 when it was listed before the Registrar. Although the respondents were represented at that time, there was no appearance by or on behalf of the applicant. Nonetheless, the respondents made telephone contact with Mr Balzola that day when it was agreed that all the parties should approach the Registrar by e-court for the purpose of obtaining a date for hearing of the motion. Suitable dates were apparently discussed among the parties as were draft directions that were prepared by the solicitor for the second respondent. I was informed that the draft directions were agreed by all parties and provided to the Registrar on 11 November when, according to the Court file, orders were made by her in accordance with those directions. The directions then made were notified to the parties by e-court on 12 November 2015.
Apart from the Registrar fixing the hearing for today, the substance of the other orders or directions then made required that the applicant file and serve any further evidence upon which it relied in support of its motion, together with an outline of its submissions, 10 working days before the hearing. The directions then required that the respondents file their evidence or further evidence in response, together with submissions, 5 days before the date fixed for hearing, with a right of response both by evidence and submissions on the part of the applicant to be filed and served 2 working days before the hearing.
It is a matter of some concern that those directions have been ignored. No further evidence in support of the applicant's motion has been filed nor have any written submissions been prepared on behalf of the applicant. When these omissions were drawn to the attention of Mr Balzola, who appeared for the applicant today, he responded by stating that while he did not deny receipt of the Registrar's e-court directions, he received many emails each day and had no specific recollection of reading those directions. Nonetheless, he did not seek to have the hearing of the motion adjourned.
Somewhat unusually, the order sought in the notice of motion was to vary Order 2 by fixing "a new date and time for the plaintiff to notify the defendants and the associate to his honour of the terms of any different costs order that it seeks". The motion did not, in terms, state the alternate costs order for which it would argue. Fortunately, Mr Balzola stated that he was prepared to argue the question as to the appropriate order for costs that should be made, namely that Order 2 should be set aside and that no order for costs of the proceedings should be made, to the intent that each party should pay its own costs.
He was correct in taking that course. It was clearly inappropriate and inconsistent with the overriding purpose expressed in s 56 of the Civil Procedure Act 2005 that today's hearing should be confined to determine whether time should be extended to give notice of the applicant's proposed alternative order and then adjourn the question as to what that order should be to another date, involving yet further costs for the parties.
[3]
Consideration
The orders made by me on 7 August were entered on 16 October 2015 when they were sealed and signed by the Registrar. The power to make the orders sought in the applicant's motion was therefore founded in r 36.16(3A) of the UCPR. Although the order sought to be set aside had been entered on 16 October, the applicant's motion was filed within 14 days from that date, with the consequence that the subrule was appropriately engaged. That circumstance does not mandate the result but rather involves the exercise of a discretion to vary or set aside the order "if appropriate".
In advancing his submissions, Mr Balzola sought to emphasise two matters. First, he pointed to the fact that from the outset the orders sought in the summons identified the applicant as one intending to bring the proceedings as a public interest litigant. Having identified that circumstance, he acknowledged that the orders sought did not establish the fact. His second principal argument emphasised the personal difficulties under which he had practised throughout the period of this litigation causing him to overlook making an application or establishing facts in support of the orders sought; overlooking the need to comply with Order 2 and overlooking the need to comply with the Registrar's directions for the hearing of this motion. While I accept that Mr Balzola experienced considerable personal distress following the death of his mother in 2013, those circumstances did not advance any proper basis upon which to vary or set aside the costs order that I had made.
The proceedings determined by me on 7 August were proceedings for judicial review. When argued, three issues were raised by the applicant. First, the applicant contended that the development consent granted by the second respondent purported to operate retrospectively in that consent was given to development that had already been carried out. Second, it was submitted that the second respondent was not the relevant determining authority because the capital investment value of the development for which consent was sought exceeded the threshold for determination by that Panel, with the consequence that the only consent authority that could have given consent was the Minister. The third issue raised the question of apprehended bias. Two councillors who sat as members of the second respondent when the impugned consent was granted were also members of the first respondent at the time at which that respondent granted development consent for substantially the same development in 2010, being the consent determined to be invalid by this Court (Hoxton Park Residents Action Group Inc v Liverpool City Council (No 3) [2012] NSWLEC 43; 190 LGERA 119). These issues are more fully elaborated at [4] of the principal judgment.
The principles that pertain to costs when an unsuccessful applicant is said to have brought proceedings in the public interest have been considered in a number of cases. In Caroona Coal Action Group Inc v Coal Mines Australia Pty Ltd (No 3) [2010] NSWLEC 59; 173 LGERA 280 Preston CJ identified a three step approach in order to assess whether an unsuccessful applicant should be relieved of the ordinary burden to bear costs because proceedings have been brought in the public interest. His Honour summarised the three steps at [13]:
"What principles or guidelines have courts formulated for exercising the costs discretion in public interest litigation which has been unsuccessful? A review of the decisions on costs reveals that courts have used, in effect, a three step approach in determining whether to depart from the usual costs rule: first, can the litigation be characterised as having been brought in the public interest?; secondly, if so, is there "something more" than the mere characterisation of the litigation as being brought in the public interest?; and thirdly, are there any countervailing circumstances, including relating to the conduct of the applicant, which speak against departure from the usual costs rule?"
In this case, there can be no doubt that but for the public interest claim, the ordinary rule that costs should follow the event would prevail. The respondents succeeded on all issues and no disentitling conduct on their part was identified. Order 2 that was made by me would therefore be consistent with the provisions of s 98 of the Civil Procedure Act 2005 (NSW) and r 42.1 of the UCPR. How then, applying the three step approach identified in Caroona, should this case be considered as one in which the applicant should be relieved of the usual order for costs?
The absence of evidence supporting the characterisation of the proceedings as having been brought in the public interest presents a formidable obstacle to the applicant in seeking to set aside Order 2. Not only does the Court have no evidence that the applicant itself can be identified as a public interest applicant, there are no facts upon which to draw an inference that the proceedings were commenced in the public interest, beyond the circumstance that the applicant relies upon the open standing provisions of s 123 of the Environmental Planning and Assessment Act 1979 (NSW) in challenging the decision of a statutory decision maker. The fact that the applicant bears the name of an "action group" and is incorporated under the Associations Incorporation Act 2009 (NSW) in no way demonstrates its public interest character sufficient to engage the dispensatory provisions of r 4.2 of the Land and Environment Court Rules 2007.
I have earlier summarised the three issues that arose for determination in the principal proceedings. Both the retrospective consent issue and the capital investment value issue required for their determination an assessment of facts. I accept the submission of Mr Balzola that the factual issues raised were not trifling. But so to submit does not, without more, support the contention that the proceedings were brought in the public interest. Any proceeding brought by way of judicial review of the decision made by a statutory decision-maker may, in one sense, be seen to be brought in the public interest. That is the case whether the purpose of the moving party is altruistic or commercially based. However, the difference between altruism and a commercial interest is a significant factor when considering the exercise of discretion to relieve an unsuccessful applicant of an order for costs that, applying ordinary principles, would otherwise be payable by it.
While I have accepted that the first two issues raised were not trifling, those issues raised no novel questions either of environmental law or law generally. They involve the application of well known principles to the facts determined by me, essentially involving the interpretation of plans (the first issue) and the proper understanding of material before the second respondent when it determined to grant development consent on 28 February 2013. Ultimately, the exercise was entirely conventional in the context of judicial review proceedings with well settled jurisprudence applied to the determination of the issues.
The third or apprehended bias issue involved no contest of fact but rather the application of well-settled principles applicable to the conduct of constituent members of statutory decision makers, particularly those that are wholly or partly comprised of elected representatives. The exemplification of the relevant principles that were argued and applied were those articulated in McGovern v Ku-ring-gai Council [2008] NSWCA 209; 72 NSWLR 504 and the leading High Court authorities that were applied in that case. No novel question was raised as to the application of those principles to the second respondent at the time at which it determined the subject development application.
In the absence of any evidence led in support of the applicant's present notice of motion, the only evidence available on the issue of public interest litigation is that able to be inferred, if at all, from the evidence led in the principal proceedings. For the reasons that I have given, applying the principles discussed in Caroona, I am unable to discern any sound basis upon which to conclude that the litigation can be characterised as having been brought in the public interest. By way of example, no evidence was identified by Mr Balzola that addressed considerations of the kind identified in Caroona at [38].
Moreover, for reasons that I have also indicated, even if the respondent had satisfied me that the proceedings could be characterised as having been brought in the public interest, "something more" than that characterisation of the litigation has not been demonstrated. In the absence of evidence, the nature, extent and other features of the claimed public interest has not been demonstrated. No novel or important issues of environmental law were raised and the only basis upon which the development of the site in question could be regarded as being notorious was that the applicant had successfully challenged an earlier development consent granted by the first respondent. That circumstance, so it seems to me, does not constitute the "something more", even if it had been established, contrary to my earlier finding, that the litigation had been brought in the public interest.
The third step identified in Caroona when exercising the costs discretion in public interest litigation, where the applicant has been unsuccessful, is to consider any countervailing circumstances. In the present case there are several matters that should be so considered. First, the summons and supporting pleading first filed by the applicant was amended on two occasions. Issues were raised and then by a decision of this Court, disallowed. At one point, the applicant sought to have related proceedings between the parties that had been commenced in the Supreme Court transferred to this Court and when that application was unsuccessful, sought, unsuccessfully, to have the proceedings in this Court transferred to the Supreme Court. Moreover, in the course of preparing the matter for hearing, directions were made on a number of occasions for the applicant to file its evidence. On five such occasions the applicant did not meet the obligation imposed by those directions.
Further the events that have occurred since the delivery of judgment on 7 August do not bear favourably upon the applicant's motion. Once it appeared that the applicant was not seeking any variation of Order 2, in that it did not notify any proposed application so to do by 21 August, on 7 September the third, fourth and fifth respondents, through their solicitor, instructed a firm of specialist costs consultants to prepare bills of costs in assessable form so as to recover the costs to which they were entitled in accordance with Order 2. That process was completed by 30 September when the costs consultant completed bills of costs, provided them to the third, fourth and fifth respondents and rendered a fee for so doing. Those bills of costs were subsequently filed with the Supreme Court for the purpose of having them assessed. The total cost incurred by those respondents in so doing was in the order of $12,000, being a debt incurred well before the present notice of motion was filed.
These countervailing factors weigh against any exercise of discretion in favour of the applicant, assuming that I was otherwise satisfied that the proceedings were brought in the public interest.
[4]
Conclusion
Fundamentally, there is a total absence of evidence or any identified basis upon which to find that the applicant has brought and pursued the proceedings in the public interest such as to entitle it to invoke the provisions of r 4.2 of the Court's rules and deny the respondents the order for costs to which they are otherwise entitled. I accept that I have power under r 36.16(3A) to set aside Order 2, but for the reasons given I am not persuaded that I should do so. Upon the proper exercise of the costs discretion, the applicant should be required to pay the respondents' costs.
I therefore make the following orders:
1. The applicant's notice of motion filed on 27 October 2015 is dismissed.
2. The applicant must pay the respondents' costs of the notice of motion.
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 22 December 2015