McCullagh v Autore

The Reason Given for the Ex Parte Nature of the Application for Injuctive Relief Was Inadequate 10When the matter initially came before the Court, it was on an ex parte basis. Mr Hartley, appearing for the McCullaghs, informed the Court that the reason why neither the Autores nor Mr Boyce had been given the opportunity of being present on the application for injunctive relief was because "the summons had only been filed 10 minutes ago and had not yet been served on the respondents". His affidavit had, however, been served. 11Asked why the matter was so urgent that ex parte orders were required, Mr Hartley told the Court that the wall was close to completion and that once completed, it would cause the partial loss of views to the McCullaghs in the manner described above. 12In support of the ex parte application, Mr Hartley relied upon correspondence of 10 April 2014 passing between Gadens Lawyers (at which Mr Hartley is employed) and Mr Michael Furlong, the General Legal Counsel of The AUTORE Group, foreshadowing today's application unless the McCullaghs signed an enclosed undertaking that day. 13But foreshadowing an application to the Court for interim relief at some unspecified time and date does not equate to a reasonable attempt to inform the Autores that the McCullaghs would be seeking to make an ex parte application the next day. The Autores appeared to be legally represented and did not appear to have ignored or delayed in responding to communications from Gadens. In other words, it could not be said that having been informed of the imminent application for temporary injunctive relief, the Autores made an informed decision not to attend the Court and not to be heard. 14The initial correspondence demonstrated that the Autores, having been informed of the McCullaghs' complaint: wished to obtain legal advice "without unreasonable delay"; required further information so that they could consider their position; and that they did not appear to be opposed to an amicable resolution to the issue. These circumstances, in my opinion, strongly militated against the application being heard on an ex parte basis. 15Although the willingness of the Autores to informally resolve the dispute was denied in an email from Mr Hartley to Mr Furlong, I do not place much weight on this email absent any further details of the impugned conduct by the Autores referred to in that email. Further, I note that the email was sent at 11.06am today, that is to say, a mere half an hour before Mr Hartley appeared before me. 16It is a fundamental tenet of our system of justice that a party whose interests will be adversely affected should be given the opportunity to be heard. It is an aspect of the rule of law. 17In this regard I rely on the observations made by Heydon J in International Finance Trust Company Limited v New South Wales Crime Commission [2009] HCA 49; (2009) 240 CLR 319 (at [150]) (where his Honour quoted from National Commercial Bank Jamaica Limited v Olint Corporation Ltd [2009] 1 WLR 1405, footnotes omitted): 150 Another instructive aspect of equitable practice is afforded in relation to the question of whether an ex parte injunction should be granted at all. It was summarised thus by Lord Hoffmann, delivering the opinion of the Privy Council in National Commercial Bank Jamaica Ltd v Olint Corporation Ltd: "Although the matter is in the end one for the discretion of the judge, audi [alteram] partem is a salutary and important principle. Their Lordships therefore consider that a judge should not entertain an application of which no notice has been given unless either giving notice would enable the defendant to take steps to defeat the purpose of the injunction (as in the case of a Mareva or Anton Piller order) or there has been literally no time to give notice before the injunction is required to prevent the threatened wrongful act. ... Their Lordships would expect cases in the latter category to be rare, because even in cases in which there was no time to give the period of notice required by the rules, there will usually be no reason why the applicant should not have given shorter notice or even made a telephone call. Any notice is better than none." (Emphasis in original.) 18International Finance has been quoted and endorsed by this Court on many occasions (for example, in Shoalhaven City Council v Bridgewater Investments Pty Ltd [2010] NSWLEC 103 at [6]). 19There are instances where, by reason of the subject-matter of the litigation (for example, cases involving demolition), it is appropriate to proceed with an application for interim injunctive relief on an ex parte basis notwithstanding that a feeble, or no, attempt has been made to notify the party the subject of the injunctive relief. But these are rare. This was certainly not one of them. 20The reasons given for the ex parte nature of the application were, on any view, inadequate. Any wall unlawfully constructed can, as Mr Hartley properly conceded, be removed and any harm would not be irremediable. Moreover, to the extent that the McCullaghs may suffer a partial loss of views to the south of the rear of their property, they will nevertheless continue to enjoy unobstructed views of the ocean and the beach to the north and directly ahead. In other words, whatever harm might befall them if the ex parte injunction were not granted, would be, on the evidence presently before the Court, minimal and, if they are ultimately successful, highly likely to be temporary. 21On this basis the Court declined to hear the application on an ex parte basis and stood the matter down until 3pm for the McCullaghs to notify the Autores and Mr Boyce of the application. 22When the matter resumed at 3pm, unsurprisingly, the Autores appeared and were legally represented. Mr Boyce was also present.

Legal Principles Applicable to the Granting of an Interlocutory Injunction 23The legal principles to be applied in determining whether or not to grant interlocutory injunctive relief have been set out in a number of cases in this Court (see Tegra (NSW) Pty Ltd v Gundagai Shire Council [2007] NSWLEC 806; (2007) 160 LGERA 1 at [6]-[58]; Bridgewater Investments at [4]-[6]; Save Our Figs Inc v General Manager Newcastle City Council [2011] NSWLEC 207; (2011) 186 LGERA 127 at [37] and Hume Coal Pty Limited v Alexander [2012] NSWLEC 267 at [69]-[82]). 24In Bridgewater Investments, Biscoe J helpfully and succinctly summarised the principles, which I respectfully adopt, as follows (at [4]-[5]): 4 An applicant for an interlocutory injunction must establish that there is at least a serious question to be tried and that the balance of convenience favours the grant of the interlocutory injunction: Castlemaine Tooheys Ltd v South Australia [1986] HCA 58, 161 CLR 148 at 153-4; Inetstore Corporation Pty Ltd (in liq) v Southern Matrix International Pty Ltd [2005] NSWSC 883 at [13] (Campbell J); Tegra (NSW) Pty Ltd v Gundagai Shire Council [2007] NSWLEC 806, 160 LGERA 1 at [6] (Preston CJ). The Court must consider whether the harm which the applicant (or, in environmental cases, the environment) would be likely to suffer if an interlocutory injunction were refused outweighs or is outweighed by the harm or inconvenience which the respondent or a third party would be likely to suffer if the injunction were granted: Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618 at 623; Tegra at [18]-[19]. Thus, the balance of convenience is more weighty than mere convenience and involves balancing the risk of doing an injustice: Kolback Securities Ltd v Epoch Mining NL (1987) 8 NSWLR 533 at 536 (McLelland J). Although normally the Court does not undertake an interlocutory trial and give or withhold interlocutory relief upon a forecast as to the ultimate result of the case (Beecham at 622), in some cases the strength of the applicant's case, above the threshold of a serious question, may be relevant to the risk of doing an injustice: Castlemaine at 154; Kolback at 536. 5 Usually, an applicant for an interlocutory injunction is required to give the Court an undertaking as to damages. This undertaking underwrites the risk, and responds to the court's anxiety, that the grant of the interlocutory injunction might later prove to be the wrong course of action and cause the respondent or a third party damage for which there is no redress except by an order for costs: European Bank Ltd v Evans [2010] HCA 6, 264 ALR 1 at [15]; Inetstore at [28]; Tegra at [28]-[31]. The "usual undertaking as to damages" is defined in r 25.8 of the Uniform Civil Procedure Rules 2005 as follows: "25.8 Meaning of "usual undertaking as to damages" The 'usual undertaking as to damages', if given to the court in connection with any interlocutory order or undertaking, is an undertaking to the court to submit to such order (if any) as the court may consider to be just for the payment of compensation (to be assessed by the court or as it may direct) to any person (whether or not a party) affected by the operation of the interlocutory order or undertaking or of any interlocutory continuation (with or without variation) of the interlocutory order or undertaking." 25The McCullaghs offered the usual undertaking as to damages.

There is No Serious Question to be Tried 26Other than a declaration that the CDC was invalid and an order seeking to set it aside, the summons is silent as to basis of the asserted invalidity. That is to say, there was no claimed breach of the Environmental Planning and Assessment Act 1979, or indeed any other enactment. 27Instead, the serious question said to arise was revealed in Mr Hartley's affidavit. At the risk of repetition, the gravamen of the McCullagh's complaint was that in calculating the height of the wall, the ground level (finished) had been used rather than the ground level (existing), which meant, because of the fill used during the present development, the wall was taller than the permissible 1.8m in height. 28This was so, it was claimed, notwithstanding that a comparison of the CDC elevation plan and a comparison of a survey plan drawn up by Eric Scerri & Associates Pty Ltd, Land Survey Consultants, of the Autore property on 2 August 2010 (tendered by Mr Boyce), demonstrated that as at 2010 - well prior to the present development - the relevant ground levels were exactly the same. In other words, the ground level used to calculate the height of the offending wall was the same as the ground level in existence prior to the present development. It therefore appeared that the Autores had not used the ground level (finished) to construct the wall, but had correctly used the ground level (existing). 29Faced with this evidence, the McCullaghs altered their argument to submit that properly construed, the term "ground level (existing)" meant the ground level prior to any development having occurred on the Autores' property, including the construction of the original dwelling located on the site. This gave rise, they submitted, to a serious question to be tried. 30It is somewhat trite to observe that the question to be tried must be a serious, rather than a trivial, one. Thus, not all questions formulated by an applicant seeking injunctive relief will satisfy this first limb. 31The question formulated by the McCullaghs fails at the first hurdle. It is a nonsense, in my view, to construe the definition given to the term "ground level (existing)" as reaching back in time to immediately before the first consent was granted to develop the land the subject of the Autores' property. This is so if for no other reason than it would have the effect of giving the SEPP retrospective effect. Moreover, the practical effect of this construction would be that any land owner wishing to construct a wall would be required to trawl back through all of the development approvals granted in respect of a parcel of land in order to determine the precise existing ground level as at the date of the first development consent. It is unlikely that such a construction gives effect to the objective intention of Parliament in drafting the definition. 32The alternative interpretation suggested by the McCullaghs was that the term "ground level (existing)" meant the ground level prior to the construction of the dwelling that the Autores presently occupy. No evidence was, however, presented to the Court to demonstrate that the ground levels had changed. Rather, the only evidence before the Court was the survey plan adduced by Mr Boyce as at August 2010, that clearly showed that the present ground level and the ground level as at that date, were the same. 33In these circumstances, I cannot find that there is a serious question to be tried. This is sufficient to dispose of the application.

The Balance of Convenience Does Not Favour the Granting of an Injunction 34However, entertaining for present purposes the possibility that I am wrong and that there is a serious question to be tried, I would nonetheless dismiss the application on the basis that the balance of convenience weighs heavily against the granting of interim injunctive relief, having regard to the evidence in Mr Hartley's affidavits and his oral submissions. 35The reasons for this conclusion are three-fold: (a)first, as the photos annexed to Mr Hartley's affidavit demonstrated, the harm to the McCullaghs if the injunction is not granted will be minimal; (b)second, the harm is likely to be entirely transient and reversible. In this regard, the Autores are alive to the risk that they may have to demolish part of the wall if the McCullaghs are successful. Although a matter of discretion for the trial judge, given the minimal cost and inconvenience of remedying the alleged breach if the wall is too high, it is, in my opinion, unlikely that the Court would not order demolition of the unlawful structure if the McCullaghs were successful; and (c)third, the delay by the McCullaghs: the CDC was issued in January (and modified in March). Accordingly, the McCullaghs have had ample time in which to challenge the CDC but elected to wait until the construction of the wall was underway before commencing proceedings and seeking injunctive relief.

Mediation 36Given the small scope of the dispute relative to the likely financial and emotional cost of its litigation, the Court enquired if the parties were willing to mediate the matter. Sensibly, all parties agreed to this course. The Court was therefore prepared to make an order to this effect under s 26 of the Civil Procedure Act 2005.

Orders 37In conformity with the reasons given above, the orders of the Court are as follows: (1)the applicants' notice of motion seeking interim injunctive relief is dismissed; (2)the applicants are to pay the respondents' costs; (3)the parties are to mediate the matter, such mediation to take place before 30 May 2014; (4)the parties are granted leave to approach the Registrar forthwith to obtain a date for mediation before a Commissioner of the Court; (5)the exhibits to the notice of motion are to be returned; (6)the matter is stood over for directions before the List Judge on 30 May 2014; and (7)liberty to restore on 48 hours' notice.

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