Kogarah City Council v Armstrong Alliance Pty Ltd

Armstrong is Given Approval to Build Five Units but Builds Six 10It was not in dispute that development consent for multi unit housing at the premises was required under the Kogarah Local Environmental Plan 1998 (cl 7). Thus, as stated above, development consent was obtained by Armstrong for this purpose. The consent remains in force. 11Specifically, the consent granted approval for a "multi unit housing development 5 x 2 bedroom dwellings and basement car park" on the premises. 12But as is abundantly apparent from a comparison of the plans as approved by the council and the plans as approved by the certifier in the issuing of the construction certificate, Armstrong is not carrying out the development in accordance with the terms of the consent (both plans were tendered before the Court). To the extent that an explanation of the inconsistencies between the two sets of plans was required, this was provided in the affidavit of Mr Paul Cox, affirmed 18 February 2013. Mr Cox is the Building Coordinator for the council. It was Mr Cox that carried out the inspection of the partly constructed residential flat building at the premises. 13According to Mr Cox, and as is evident from an examination of the plans referred to above, there are significant inconsistencies between that which has been constructed and that which has been approved. The most significant of the differences include: (a) an additional unit has been constructed which is not depicted on the plans approved by the council; (b) an additional storey and outdoor terrace has been constructed which is not shown on the plans approved by the council; (c) an unapproved elevator shaft to access the unapproved storey and unit has been constructed; (d) the basement car park on the first level has been increased in size and the layout altered; (e) the internal layout of several apartments has been altered; and (f) there is additional excavation on the second level near unit 1. 14There was no dispute that the building works are in breach of the EPAA. And nor could there be, plainly they are. 15Moreover, it was agreed that the certifier, Mr Dix, was in breach of the EPAA insofar as, at all relevant times, he was required not to issue a construction certificate for any building work unless the requirements of reg 145(1)(a) of the Environmental Planning and Assessment Regulation 2000 had been complied with (see s 109F(1)(a) of the EPAA). Regulation 145(1)(a) requires that at all times the design and construction of a building not be inconsistent with the terms of the development consent. Clearly this requirement was flagrantly transgressed by Mr Dix. In light of the evidence before the Court, I therefore have no hesitation in finding that the design and construction of the building as depicted in the construction certificate plans was inconsistent with the development consent. 16Accordingly, the material before the Court discloses an adequate evidentiary basis for declaring the construction certificate to be invalid. 17In addition, there is not only utility in making such a declaration, there is a very real necessity to do so. This is because unless a formal order of invalidity of the construction certificate is made, the construction certificate remains valid. 18The declaratory relief sought should therefore be granted.

Release from Undertaking 19Armstrong seeks to be released from the undertaking given to the Court on 23 December 2011. It also seeks an order that the s 121B stop work order be revoked. 20The present undertaking and the stop work order forbids the carrying out of any construction work whatsoever on the premises. However, following the successful appeals before Morris C, Armstrong now needs to carry out the works that have been approved by the Commissioner in order to obtain a building certificate. 21Armstrong is prepared to give a new undertaking in the terms set out in the orders made in conformity with the short minutes of order handed up to the Court to enable it to carry out these works. In these circumstances, it is appropriate that Armstrong be released from its earlier undertaking.

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.

Orders 28The orders of the Court are therefore as follows, by consent the Court: (1) declares that the construction certificate issued by Dix Gardner Pty Ltd dated 25 May 2011 and numbered 137/11 is invalid and of no effect; (2) releases the first respondent from the undertaking given to the Court on 23 December 2011; (3) vacates the orders made by the Court on 6 June 2012 in proceedings 10024 of 2012 by Brown ASC (Armstrong Alliance v Kogarah City Council [2012] NSWLEC 1151) and revokes the order made by the applicant under s 121B of the EPAA on 21 December 2012; (4) notes the undertaking of the first respondent that: (a) the first respondent will cease all construction works at Lot 36 DP 4724 being 19 Elizabeth Street, Allawah, that are associated with the construction of a residential flat building except for works required by the orders of Morris C made in Armstrong Alliance v Kogarah City Council [2012] NSWLEC 1360, as set out in Annexure 'A' of the judgment for the issue of the building certificate; (b) the first respondent will not carry out any other works not caught by paragraph 4(a), unless and until: (i) a Principal Certifying Authority has been appointed by the first respondent and which appointment has been notified to the applicant, and a construction certificate is obtained for the completion of the remainder of the building works as per the original DA consent no 242/2006 and the construction works in accordance with DA consent no 65/2012 which is the subject of a deferred commencement; (ii) a building certificate is issued for the building as contemplated by the orders made by Morris C in Armstrong Alliance v Kogarah City Council [2012] NSWLEC 1360; and (iii) the new deferred commencement consent condition is satisfied in respect of DA 65/2012 as contemplated by the order made by Morris C in Armstrong Alliance v Kogarah City Council [2012] NSWLEC 1360; (5) orders, without admission by the first respondent, the first and second respondent to pay the applicant's costs of these proceedings as agreed or assessed, except for the costs the subject of the costs order made by Preston J on 23 December 2011; and (6) orders that the exhibits be returned.

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: 18 March 2013