Lester v Ashton Coal Pty Ltd

The approach to determining the costs order 4Mr Lester's proceedings were civil proceedings brought pursuant to the open standing provision, s 193(1) of the Parks Act, to remedy or restrain breaches of s 86(1) of the Parks Act. Such proceedings are allocated to Class 4 of this Court's jurisdiction. The Court has a discretionary power under s 98 of the Civil Procedure Act 2005 to order costs. Rule 42.1 of the Uniform Civil Procedure Rules 2005 (UCPR) provides that the usual exercise of the discretion will be for the court to order that costs follow the event unless it appears to the court that some other order should be made as to the whole or part of the costs. However, this Court has made a particular rule for Class 4 proceedings brought in the public interest, which prevails over r 42.1 of the UCPR to the extent of any inconsistency: Civil Procedure Act, s 11 and UCPR, r 1.7 in sch 2. Rule 4.2(1) of the Land and Environment Court Rules 2007 provides that: '[t]he Court may decide not to make an order for the payment of costs against an unsuccessful applicant in any proceedings if it is satisfied that the proceedings have been brought in the public interest.' 5In short, if the Court is satisfied that the proceedings have been brought in the public interest, the Court may decide not to make an order that the unsuccessful applicant pay any of the respondents' costs, or make an order that the unsuccessful applicant pay only some of the respondents' costs or pay the costs of only one or other of the respondents. 6In exercising the discretion whether to depart from the usual costs rule, the Court should act in a principled way. In Caroona Coal Action Group Inc v Coal Mines Australia Pty Ltd (No 3) [2010] NSWLEC 59; (2010) 173 LGERA 280, I reviewed the authorities on awarding costs in public interest litigation. That review revealed 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 being 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 in relation to the conduct of the applicant, which speak against departure from the usual costs rule? 7In their submissions, the parties have employed this three step approach, although they differ in the answers they would give to each of the three questions.

Litigation can be characterised as being in the public interest 8Applying this three step approach, I find, firstly, that the litigation as finally pleaded can be characterised as being brought in the public interest. The litigation was subject to metamorphosis at numerous times from its commencement to its conclusion at the hearing. In the end, however, the only claims in the litigation were that Ashton had breached s 86(1) of the Parks Act by harming Aboriginal objects at three locations, referred to as the Oxbow site, Waterhole site and Pleistocene site, and the orders sought were to remedy such breaches. The proceedings sought to uphold and enforce important obligations in a public welfare statute intended to protect Aboriginal cultural heritage and the environment. This constitutes a public interest of a sufficient kind. 9It does not lose this character because the Office of Environment and Heritage, the governmental agency with responsibility for administering the Parks Act, elected not to bring civil enforcement proceedings against Ashton to remedy or restrain any breaches of s 86 of the Parks Act in relation to Ashton's activities. The Parks Act, by reason of the open standing provision in s 193, allows any person to bring civil enforcement proceedings to remedy or restrain a breach of the Parks Act. As Basten JA observed in Hastings Point Progress Association Inc v Tweed Shire Council (No 3) [2010] NSWCA 39; (2010) 172 LGERA 157 at [7], in conformity with the purpose of such statutory open standing provisions, any attempt to ensure that the statute is not breached with impunity will constitute a public interest of a sufficient kind. In this case, Mr Lester's claim is not a bare claim of mere technical breach: the nature of the statutory provision claimed to be breached, the nature of the Aboriginal objects claimed to be harmed, and the nature of the harm claimed are all of significance. 10The applicant, Mr Lester, is an elder of the Plains Clan of the Wonnarua people whose country includes the three locations in which he claimed Ashton had harmed Aboriginal objects. As such, Mr Lester has a special interest in the protection of Aboriginal cultural heritage at these locations. However, the protection of Aboriginal cultural heritage, including at these locations, is of broader interest to both the Aboriginal community and the non-Aboriginal community. The interest is not confined to a small section of the community. 11Having regard to the nature of the civil enforcement proceedings and the orders to remedy or relieve the breaches able to be granted in the proceedings, Mr Lester would not benefit financially by the outcome of the proceedings. This conclusion remains true notwithstanding Ashton's submission that Mr Lester sought in negotiations to settle the proceedings in a way which might yield pecuniary benefits to the Plains Clan of the Wonnarua people. 12Together, these considerations, which were suggested by Lloyd J in Engadine Area Traffic Action Group Inc v Sutherland Shire Council (No 2) [2004] NSWLEC 434; (2004) 136 LGERA 365 at [15] as being indicia of public interest proceedings, are sufficient to allow characterisation of the proceedings as being brought in the public interest.

The public interest is of significance beyond mere characterisation 13Secondly, the nature, extent and other features of the public interest involved in the litigation are significant and constitute something more than the mere characterisation of the proceedings as being brought in the public interest. 14Mr Lester's claims concerned the upholding and enforcement of s 86(1) of the Parks Act. The Parks Act was legislatively amended in 2010, including s 86. Section 86 introduced a reformulated prohibition on harming Aboriginal objects. Mr Lester's claim was the first civil enforcement case involving s 86 as reformulated. Although in the end, the result of the case turned on the failure of Mr Lester to prove on the evidence before the Court each of the breaches of s 86, some novel issues of general importance were raised. In particular, Mr Lester's claim concerning harm to Aboriginal objects at the Oxbow site raised novel issues concerning the concept of 'harm' to Aboriginal objects, including whether movement of an Aboriginal object within ground that subsides is movement within the meaning of para (b) of the definition of 'harm' in s 5(1) of the Parks Act and, if so, whether such movement can be excluded as being 'trivial or negligible' within the meaning of para (f) of the definition of 'harm'. These questions had not been resolved in earlier cases. Aboriginal Heritage Impact Permits ('AHIPs') issued in relation to activities by Ashton, including at the three locations, had assumed that movement of Aboriginal objects by subsidence could constitute harm and, to an extent, sought to authorise such movement and specified action to remedy its effects. The issues were, therefore, live and topical. 15There were also other issues of interpretation of the provisions of the Parks Act which would have arisen if the Court had made different findings as to breach, including regarding defences and remedies. 16In these ways, the determination of the litigation has or could have contributed, in a material way, to the proper understanding and administration of the law regarding harm to Aboriginal objects. 17As I have found, the litigation was brought to protect items of Aboriginal cultural heritage and the environment, being the Aboriginal objects listed in various site cards for sites recorded and registered in the Aboriginal Heritage Information Management System maintained by the National Parks and Wildlife Service. It is true that I found that Mr Lester did not prove on the evidence before the Court that Ashton's activities had harmed these Aboriginal objects. This does not mean, however, that those Aboriginal objects were not of significance or that litigation with the purpose of protecting those Aboriginal objects was not in the public interest. As I have said, the protection of the Aboriginal objects was of interest and importance to the Plains Clan of the Wonnarua people, in whose country the objects were located, as well as to the broader Aboriginal and non-Aboriginal communities.

Countervailing consideration: unreasonable conduct of litigation in certain respects 18This brings me to the third step of considering whether there are any countervailing considerations which, notwithstanding these findings that the litigation has been brought in the public interest, may justify declining to depart from the usual costs rule. The respondents point to a number of countervailing considerations. 19First, Ashton submits that at least one of Mr Lester's purposes in maintaining the proceedings was to attempt to pressure Ashton to reopen negotiations for the provision of a financial package to the Plains Clan of the Wonnarua people. Ashton's evidence included Mr Lester offering to cease all current court proceedings, including these Land and Environment Court proceedings against Ashton, if Ashton agreed to a specified financial package. Ashton submits that such conduct dilutes the public interest character of the litigation and establishes a private financial interest in the litigation. 20Secondly, both respondents submit that Mr Lester made numerous amendments to his pleadings, ultimately abandoning many of the claims he originally made. To raise, pursue for a significant period of time, but then abandon claims which have no or little merit is a countervailing consideration: Caroona Coal Action Group Inc v Coal Mines Australia Pty Ltd (No 3) at [61(e)]. 21Thirdly, the respondents submit that Mr Lester conducted the litigation unreasonably. The unreasonable conduct of litigation can also be disentitling conduct: Caroona Coal Action Group Inc v Coal Mines Australia Pty Ltd (No 3): at [61(f)]. 22The respondents submit that Mr Lester sought inappropriate interlocutory relief, most of which was not granted. This included seeking by notice of motion in these Class 4 proceedings to stay judgment in separate Class 1 proceedings to which Mr Lester was not a party. This application was dismissed by Craig J in Lester v Ashton Coal Mining Operations Pty Ltd [2011] NSWLEC 155. Mr Lester also issued at least two notices to produce to the second respondent that were unclear. 23The respondents submit that Mr Lester failed to provide adequate particulars of his claims. Prior to the hearing, Ashton twice sought particulars as to what Aboriginal objects Mr Lester alleged had been knowingly harmed by Ashton and how those objects were alleged to have been harmed but Mr Lester did not provide adequate particulars in response. The respondents submit that this lack of particularisation regarding the Aboriginal objects continued until the hearing. 24The respondents submit that the unreasonableness in conducting the litigation continued after March 2012 when Mr Lester ceased to be represented by a non-legally qualified agent and instead engaged solicitors. The respondents submit that the deficiencies in the applicant's evidence regarding harm to Aboriginal objects were, or should have been, manifest to Mr Lester, yet Mr Lester persisted with his claims that Aboriginal objects had been harmed. The respondents also submit that Mr Lester's claims concerning breach of conditions of AHIPs could never establish breach of s 86(1) of the Parks Act and should not have been pursued. Finally, the respondents submit that Mr Lester's pursuit of the claim that Ashton was vicariously liable for the actions of an unrelated corporation in relation to one of the locations was also unreasonable. 25I consider there is force in many of the respondents' submissions that Mr Lester conducted some of the litigation unreasonably and that this conduct can be a countervailing consideration. This unreasonable conduct of the litigation occurred during the period when Mr Lester was represented by a non-legally qualified agent. The unreasonable conduct was of four kinds. 26First, Mr Lester (by his agent) unreasonably raised and pursued, but then abandoned, points which had little or no merit. Mr Lester's summons and points of claim adopted a scattergun approach, including raising claims (which changed over time) that: the development consent granted in 2001 permitting Ashton to undertake coal mining was invalid; Ashton had breached conditions of the development consent; Ashton's application for the AHIP, the subject of appeal in different Class 1 proceedings, was incomplete and ineffective; those Class 1 proceedings, to which Mr Lester was not a party, should be stayed until his Class 4 proceedings are determined; after the Court determined to issue the AHIP in the Class 1 proceedings, the Court issued AHIP was inoperative in relation to land owned by Macquarie Generation (the Pleistocene site); Ashton had breached conditions of the Court issued AHIP; Ashton had breached s 86(4) of the Parks Act without a permit under s 90 of the Act; and, in substitution for the previous claim of breach of s 86(4), Ashton had breached s 86(1) or alternatively s 86(2) of the Parks Act. All but the claim of the breach of s 86(1) of the Parks Act were not pursued by Mr Lester. From the commencement of the proceedings until the end of the final hearing, the summons was amended five times and the points of claim nine times. 27Secondly, Mr Lester (by his agent) made numerous applications for interlocutory relief which occupied considerable time and involved considerable cost. Mr Lester sought an interlocutory injunction restraining Ashton from carrying out any of its mining operations which relied on the authority of the development consent and AHIP, and not just mining operations near the Aboriginal objects at the three locations claimed to be harmed. Mr Lester's application for interlocutory injunction was argued for a full day but after an adjournment was eventually not pressed: see Lester v Ashton Coal Mining Operations Pty Ltd (No 2) [2011] NSWLEC 177 at [29], [31]. Mr Lester sought an order in these Class 4 proceedings, staying different Class 1 proceedings to which he was not a party. This was argued three times (see Lester v Ashton Coal Mining Operations Pty Ltd (No 2) [2011] NSWLEC 177 at [60]) but was dismissed (Lester v Ashton Coal Mining Operations Pty Ltd [2011] NSWLEC 155 at [24], [28]). Mr Lester also sought an application to transfer those Class 1 proceedings to these Class 4 proceedings, but this too was dismissed: see Lester v Ashton Coal Mining Operations Pty Ltd [2011] NSWLEC 155 at [26]-[28]. Mr Lester's application to gain access to the site for himself and his experts was, ultimately, successful but it took an unreasonably long period of time to argue, over three separate days: Lester v Ashton Coal Mining Operations Pty Ltd (No 2) [2011] NSWLEC 177 at [60]. 28Thirdly, Mr Lester provided at least two notices to produce to the second respondent which were unclear in their terms. The second respondent moved on notice to set aside the notices to produce pressed by Mr Lester: see Lester v Ashton Coal Mining Operations Pty Ltd (No 2) [2011] NSWLEC 177 at [31]. Although the notices of motion seeking to set aside the notices to produce were listed for hearing as part of the interlocutory applications, they do not seem to have been finally determined, perhaps being overtaken by other events. The result was that the notices to produce caused the second respondent unnecessarily to incur costs. 29Fourthly, Mr Lester failed to adequately particularise his claims. In particular, he failed to identify the Aboriginal objects he claimed Ashton had harmed in breach of s 86(1) of the Parks Act, both in his original and amended pleadings and in response to requests. Ashton requested, on 13 February 2012, Mr Lester to provide particulars in relation to the Aboriginal objects he claimed Ashton had harmed but Mr Lester (by his agent) on 24 February 2012 failed to provide adequate particulars in response. On 29 February 2011, Ashton pressed Mr Lester to provide adequate particulars, foreshadowing that if he failed to do so, Ashton would seek an order from the Court that he provide proper particulars. Mr Lester (by his agent) did not provide any further particulars. 30On 9 March 2012, Ashton filed a notice of motion that certain parts of Mr Lester's then summons and points of claim be struck out, or, in the alternative, that Mr Lester provide further and better particulars. After this, on 13 March 2012, Mr Lester decided to no longer be represented by the non-legally qualified agent and instead to engage solicitors. The next day, 14 March 2012, on the return of the notice of motion before the Court, Mr Lester's newly engaged solicitor sought and was granted leave to file and serve a proposed amended summons and points of claim which would address the concerns raised by Ashton in its notice of motion as to the deficiencies in the pleaded claims and particulars. To a considerable extent the amended summons and amended points of claim proposed by the solicitors achieved these goals. Hence, on 30 March 2012, Mr Lester was granted leave by the Court to rely on the proposed amended summons and points of claim. 31Nevertheless, on 3 April 2012, Ashton made another request for further and better particulars of the amended pleadings. Mr Lester (by his solicitor) responded on 13 April 2012 providing more particulars. On 19 June 2012, at a directions hearing before me, after examining the pleadings for the purpose of making appropriate directions concerning expert evidence, I directed Mr Lester to file another amendment of the points of claim which would better particularise his case. Mr Lester provided on 21 June 2012 a proposed amendment of the points of claim. On 22 June 2012 I declined to grant leave to Mr Lester to rely on this version but I did indicate that leave might still be granted if Mr Lester provided an amended version which better articulated the breaches of s 86(1) of the Parks Act claimed by Mr Lester. Ultimately, at the hearing, better pleaded points of claim were provided and I granted leave to Mr Lester to rely on these amended points of claim. 32In these four respects, Mr Lester conducted the litigation in a way which unnecessarily increased the costs to the respondents beyond what they would have incurred if the litigation had been conducted reasonably. 33However, I do not characterise as being part of the unreasonable conduct, Mr Lester's negotiations to settle the proceedings on terms which might have resulted in pecuniary benefits for the Plains Clan of the Wonnarua people. The evidence is insufficient to establish that Mr Lester's conduct of the litigation was motivated by the matters raised in the negotiation. The negotiations, which were unsuccessful, did not cause the respondents to incur costs unnecessarily. Further, negotiations with a view to obtain some private benefit, do not cause the litigation to lose its public interest character. The issue is not the subjective motivation of the litigant but the public or private character of the litigation: Oshlack v Richmond River Council at [140]; Caroona Coal Action Group Inc v Coal Mines Australia Pty Ltd (No 3) at [44], [45]. 34I also do not consider that Mr Lester's claims of breach, and the evidence in support, were so manifestly deficient that it could be said that Mr Lester's pursuit of the claims was unreasonable.

Balancing the considerations: partial dispensation 35I find that Mr Lester's unreasonable conduct in running the litigation in the respects I have found above to be a strong countervailing consideration that supports application of the usual costs rule for these respects of unreasonable conduct of the litigation. Although I find that the public interest character of the litigation does justify a departure from the usual costs rule, it would not be fair and reasonable for any dispensation to apply to these respects of unreasonable conduct of the litigation. Courts have observed that the public interest applicant does not have a special or privileged status but should be held to the same standards of conduct of litigation as any other party; they are not granted an immunity from costs or a 'free kick' in litigation: Oshlack v Richmond River Council at [134]; South West Forest Defence Foundation Inc v Executive Director, Department of Conservation and Land Management (WA) (No 2) [1998] HCA 35; (1998) 72 ALJR 1008; 101 LGERA 114 at [5]; Caroona Coal Action Group Inc v Coal Mines Australia Pty Ltd (No 3) at [19]. 36In my opinion, an appropriate balancing of these considerations would be to exercise the discretion to depart from the usual order as to costs by reason of the litigation being brought in the public interest, but not for the respects of unreasonable conduct of the litigation. This can be achieved by making an order that Mr Lester pay the respondents' costs in relation to those respects in which the litigation was conducted unreasonably, but not otherwise. Mr Lester should be ordered to pay the respondents' costs in relation to Mr Lester's notices of motion filed 8 August 2011 and 24 August 2011; Mr Lester's notices to produce to the second respondent filed 5 August 2011 and 23 August 2011 and the second respondent's notices of motion filed 15 August 2011 (amended 18 August 2011) and 14 September 2011 seeking to set aside Mr Lester's notices to produce; Mr Lester's applications heard and determined by Craig J on 29 August 2011; Mr Lester's applications heard by Sheahan J on 5 and 18 August and 27 September 2011 and determined on 13 October 2011; and Mr Lester's notice of motion filed 6 March 2012 dismissed by Pepper J on 14 March 2012. 37An order that Mr Lester pay the respondents' costs in these respects also deals with the questions of the costs of the interlocutory applications reserved by other judges. Mr Lester will be required to pay the costs of those interlocutory applications. 38In relation to the costs of the respondents' motion for costs, I consider that each party should pay their own costs. Each of the parties have been in part successful and in part unsuccessful in their claims for costs of the proceedings. The parties' respective success and lack of success balances out.

39Accordingly, I make the following orders: (1)The applicant is to pay the costs of the first and second respondents in relation to Mr Lester's notices of motion filed 8 August 2011 and 24 August 2011; Mr Lester's notices to produce to the second respondent filed 5 August 2011 and 23 August 2011 and the second respondent's notices of motion filed 15 August 2011 (amended 18 August 2011) and 14 September 2011 seeking to set aside Mr Lester's notices to produce; Mr Lester's applications heard and determined by Craig J on 29 August 2011; Mr Lester's applications heard by Sheahan J on 5 and 18 August and 27 September 2011 and determined on 13 October 2011; and Mr Lester's notice of motion filed 6 March 2012 dismissed by Pepper J on 14 March 2012. (2)Each party is to pay their own costs of the respondents' respective notices of motion for costs.

Amendments 21 November 2012 - Amendment made to year from 2001 to 2012, typographical error. Amended paragraphs: 1 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 November 2012