Costs
22Both Armstrong and Mr Dix consent to an order (in the case of Armstrong, without admissions) that they pay the costs of the council as agreed or assessed.
23Mr Dix did not take an active role in these proceedings, appearing instead by way of submitting appearance. Nevertheless, it is appropriate that the Court orders costs against him. This is consistent with the established principle that a party cannot necessarily immunise itself from costs by entering a submitting appearance because otherwise a successful applicant, which in the present case is the council, may not be properly compensated for costs.
24In Cutcliffe v Lithgow City Council [2006] NSWLEC 463; (2006) 147 LGERA 330 Biscoe J formulated the following general principles governing the costs order the Court proposes to make in these proceedings (at [50]):
50 The following general guidelines may be formulated, based on the cases and principles reviewed in this judgment, for the exercise of the Court's discretion to order costs where· an applicant successfully brings proceedings that are necessary to have declared invalid or set aside a development consent or decision of a consent authority;
· the consent authority and the beneficiary of the development consent or decision are necessary or proper parties; and · the cause of the invalidity is an error of or attributable to the consent authority and not to the beneficiary:
(a) the applicant will ordinarily be entitled to be compensated by an award in its favour of the costs of the proceedings unless it has engaged in disentitling conduct. (b) where the beneficiary does not defend the proceedings, the applicant's costs will ordinarily be awarded against the consent authority, whether or not the latter enters a submitting appearance. This is because the cause of the litigation is the error of the consent authority and not of the applicant or the beneficiary. The consent authority cannot immunise itself from costs consequences of its own error by entering a submitting appearance because then a successful applicant cannot be properly compensated in costs. It is not sufficient that a consent authority should bear the applicant's costs only up to the time of the consent authority's submitting appearance because the applicant must continue to incur costs thereafter in order to establish, by evidence and argument at a hearing, that it is entitled to declaratory and injunctive relief.
(c) where the beneficiary does defend the proceedings, albeit unsuccessfully, the applicant's costs will ordinarily be awarded against both the beneficiary and the consent authority, whether or not the latter enters a submitting appearance. The award of costs against the consent authority is because its error is the cause of the litigation. It cannot immunise itself from costs by entering a submitting appearance for the reason given in (b) above. The award of costs against the beneficiary is because it chose to defend the proceedings. A qualification is that the beneficiary alone may be required to bear the applicant's costs to the extent that they exceed the costs that the applicant would have incurred if both respondents had submitted, being costs attributable to defences that the beneficiary has unsuccessfully raised and the consent authority has not raised. An example may be a defence by the beneficiary that, notwithstanding an invalidating error by the consent authority, the court, for discretionary reasons, ought not to grant any relief. (d) where the consent authority has submitted and the beneficiary has defended but settles with the applicant who then seeks costs only against the consent authority, the applicant's costs will ordinarily be awarded against the consent authority and the latter will ordinarily be entitled to an indemnity for an appropriate proportion of those costs from the beneficiary, subject to the qualification referred to in (c) above. This situation may be unusual but it reflects the present case.
25These principles were recently endorsed and applied by Preston J in Brown v Randwick City Council (No 2) [2012] NSWLEC 28 (at [25]):
25 Ordinarily, where both the consent authority that grants a development consent or makes a decision and a beneficiary of the development consent or decision are joined as necessary or proper parties to a successful judicial review challenge to the development consent or decision, the successful applicant's costs will be awarded against both the consent authority and the beneficiary. As Biscoe J stated in Cutcliffe v Lithgow City Council [2006] NSWLEC 463; (2006) 147 LGERA 330 at [50], the award of costs against the consent authority is because its error is the cause of the litigation. The consent authority cannot immunise itself from costs by entering a submitting appearance because then a successful applicant cannot be properly compensated in costs. The award of costs against the beneficiary who chooses to defend proceedings and take an active part in them is because of that choice. If a beneficiary wishes to avoid costs, it must choose not to defend the proceedings.
26In the present case a declaration of invalidity with respect to the construction certificate has been sought and granted by reason of Mr Dix's unlawful conduct in issuing the certificate contrary to law. Having regard to the principles set out above, it is appropriate that a costs order be made against him.
27It should be noted that the costs order has been framed on a "without admissions" basis in order to preserve Armstrong's rights against Mr Dix in respect of any future claim that Armstrong may have against him.