Mornington Peninsula SC v Ackermann & Ors [2011] VCAT 164

1. The objectors set out in Appendix A must pay the costs of Mornington Peninsula Shire Council and Rosebud and District Motorcycle Club Inc in proceedings P3279/2007 and P2845/2008 on a party/party basis on the Supreme Court Scale including -

1. The costs of hearings conducted on 24 and 25 November 2008 and 10 December 2009; 2. The costs of directions hearings conducted on 28 March 2008, 16 May 2008, 11 August 2008 and 2 October 2009;

1. The costs of statutory declarations, witness statements, the Agreed Statement of Facts, views and written submissions; and

1. The costs of this application for costs.
2. With respect to the Mornington Peninsula Shire Council, I certify for two Counsel, including Senior Counsel.
3. In respect of the Rosebud and District Motorcycle Club Inc I certify for Counsel.
4. In default of agreement as to the quantum of costs to be paid, such costs are to be assessed by the Victorian Costs Court in accordance with the Supreme Court Act 1986, and the Supreme Court (Civil Procedure Rules) 2005.
5. The costs must be paid within 90 days of the date of this order or, failing agreement, within 90 days following determination by the Victorian Costs Court

1. This is an application for costs by Mornington Peninsula Shire Council (the council) and Rosebud District Motorcycle Club Inc (the motorcycle club) against the persons listed in Appendix A (the objectors).
2. The objectors are the applicants for an enforcement order against the council and the motorcycle club and others in application P3279/2007 and are the respondents in the declaration proceeding initiated by the council in application P2845/2008.
3. The council seeks the following orders:

(1) The objectors pay the council's costs of proceedings P3279/2007 and P2845/2008 on a solicitor-client basis on the Supreme Court Scale including -

1. The costs of hearings conducted on 24 and 25 November 2008 and 10 December 2009;
2. The costs of directions hearing conducted on 28 March 2008, 16 May 2008, 11 August 2008 and 2 October 2009;

1. The costs of statutory declarations, witness statements, the Agreed Settlement of Facts, transcript, views and written submissions; and

(2) Certify for two Counsel including Senior Counsel; and

(3) In default of agreement as to the quantum of costs to be paid the the quantum must be determined by the Costs Court in accordance with the Supreme Court Act 1986, and the Supreme Court (Civil Procedure Rules) 2005.

1. The council has not provided a quantum of costs.
2. The motorcycle club seeks the following orders:
   1. The persons described in the Schedule to this Order are to pay within 120 days of the date of this order the costs of Rosebud & District Motorcycle Club Inc in these proceedings in the amount of $32,496.50.
   2. Alternatively, the persons described in the Schedule to this order pay Rosebud & District Motorcycle Club Inc's costs of these proceedings on a solicitor/client basis on the Supreme Court Scale including:

(i) the costs of the hearings that took place on 24 & 25 November 2008 and 10 December 2009;

(ii) the costs of the directions hearings that took place on 28 March 2008, 16 May 2008, 11 August 2008 and 2 October 2009;

(iii) the costs of the statutory declarations, witness statements, the Agreed Statement of Facts, transcript, view and written submissions; and

1. Certify for Counsel; and
2. In default of agreement as to the quantum of the costs to the paid [sic]costs to be taxed.
3. The quantum of costs being sought by the motorcycle club is an amount of $32,496.50.
4. The objectors seek orders that all parties should pay their own costs.
5. I have read and considered all the submissions made by the various parties. I shall not repeat them in detail.
6. Section 109 of the Victorian Civil & Administrative Tribunal Act 1998 provides that each party is to bear their own costs in a proceeding, but that the Tribunal may make an order that a party pay the costs of another party if satisfied that it is fair to do so having regard to the range of matters set out in section 109(3). Under section 109 Victorian Civil & Administrative Tribunal Act 1998, I am satisfied it would be fair to make an order that the objectors should pay the costs of both the council and the motorcycle club based on the following provisions of the Victorian Civil & Administrative Tribunal Act 1998:
   • Section 109(3)(d) - the nature and complexity of the proceeding; and
   • Section 109(3)(b) - whether a party has been responsible for prolonging unreasonably the time taken to complete the proceeding.

1. In December 2007, the objectors applied for an enforcement order[1] restraining the council from allowing the Long Point Reserve ("reserve") from being used at any time for motorcycle events or activities of any kind or gun shooting events or activities of any kind.
2. Long Point Reserve is a council owned outdoor recreational facility. Council purchased the land in March 1984 specifically as a facility on which the uses of motorcycling, shooting and archery could be conducted. The effect of the enforcement order application would have been to close down the two most popular activities conducted at the reserve.
3. The reserve had operated as an outdoor recreational facility in this way since the early 1980's and prior to residences being erected near the reserve. For some years prior to the enforcement order application, residents had complained of increasing volume and intensity of noise coming from activities on the reserve. There were negotiations and communications between residents and the council about the conduct of activities at the reserve. The objectors were dissatisfied with council's approach to controlling activities on the reserve. They, refer at length in their submission to communications between them and the council about leases of the reserve to the user groups as a means of controlling activities on the reserve. The objectors submit:

... neither is it surprising that after seven or eight years, during which time the Objectors had pleaded with the council to do something, and it had done little or nothing, the objectors albeit reluctantly should commence a proceeding at VCAT.

1. Prior to proceedings being issued, the council's solicitors had written to the residents' solicitors by letter dated 8 October 2007 setting out the council's position in relation to various claims made on behalf of the objectors and indicating that the council considered the reserve enjoyed existing use rights under the Mornington Peninsula Planning Scheme in respect of the activities conducted on the reserve.
2. The objectors lodged their enforcement order application on 18 December 2007 claiming that the reserve was being used for purposes contrary to the planning scheme and that noise from motorcycle activities and shooting constituted a nuisance under the Health Act 1958 and at common law.
3. By letter dated 6 February 2008, the Council's solicitors wrote to VCAT (and other parties) contending that the objectors' claim was defective, hopeless, unsustainable and identified no reasonable cause of action. The council sought to strike out the claim and indicated that costs may be sought.
4. At a Practice Day Hearing before Deputy President Gibson on 28 March 2008, the council raised the issue of existing use rights as a complete defence to the enforcement order application. The council and objectors were directed to file any amended statements of grounds. On 17 April 2008, the council filed grounds addressing existing use rights and challenging the nuisance grounds alleged by the objectors.
5. The application came before Deputy President Gibson on 16 May 2008 to consider the question of existing use rights. The Deputy President, amongst other things, required the objectors to file and serve further and better particulars of their grounds by 16 June 2008. Although 18 pages in length, the Further and Better Particulars filed on 23 June 2008 did not clarify the basis of the enforcement order application as Deputy President Dwyer held in Ackermann v Mornington Peninsula SC [2008] VCAT 1619 (12 August 2008).
6. The enforcement order application came before Deputy President Dwyer on 11 August 2008. The Tribunal said:

[7] Through the discussion which took place at the Directions Hearing on the above issue, it became apparent that the applicants have yet to fully articulate the nature of the alleged contraventions which form the basis of the enforcement order proceeding. The application for an enforcement order alleges a breach of clauses 21, 22 and 36 of the Mornington Peninsula Planning Scheme. The first two of these are what might be called "policy" provisions which do not comprise any formal regulatory control, and clause 36 is only raised indirectly to the extent it refers to the Municipal Strategic Statement in Clause 21. Accordingly, despite the applicants having filed further and better particulars in accordance with a prior direction of the Tribunal, it is still not apparent to the Tribunal what the exact nature of the contraventions are that are alleged to form the basis of the proceeding under s 114 of the Planning and Environment Act 1987. It is perhaps for this reason that the responsible authority seems unsure of the particular case it has to answer as respondent to that proceeding, and has concerns that if there is a more general cause of action (such as common law nuisance), it should be brought before a court.

[8] Mr Johnson was also in some difficulty in articulating the exact basis for the s 114 proceeding when asked specific questions by me about this. Unless or until the nature of the contravention is more carefully articulated, the application at a prima facie level seems somewhat misconceived. If the applicants are indeed alleging common law nuisance or nuisance under the Health Act 1958, these are matters that ought to be pursued before a court. If there is some alleged breach of the Planning and Environment Act 1987, or the Mornington Peninsula Planning Scheme, or a permit currently in existence, then that contravention needs to be more clearly articulated before this matter proceeds to a hearing. I have therefore made an order that, within 14 days, the applicants file and serve a statement specifying further material in this regard.

1. A statement in writing as ordered by Deputy President Dwyer was filed by the objectors on 22 August 2008.
2. On 29 September 2008, council issued proceedings[2] seeking declarations that all three uses conducted on the reserve - motorcycling, shooting and archery - had existing use rights under clause 63 of the planning scheme. Whilst opposed by the objectors, ultimately declarations were made by the Tribunal in the terms sought as to all three uses.
3. The objectors continued to rely upon allegations of nuisance until November 2008 when they acknowledged that the main issue for determination by the Tribunal was existing use rights and that no evidence would be called in relation to nuisance.
4. In the lead up to the Tribunal hearing on 24 and 25 November 2008, witness statements were prepared by both council and the objectors. Council's legal advisers, in consultation with the objectors, then prepared an agreed statement of facts on the basis of the evidence set out in the witness statements. Preparation of the agreed statement of facts greatly reduced the length of the hearing before the Tribunal. The hearing proceeded on the basis of the agreed statement of facts and witness statements.
5. Both the enforcement and the declaration proceedings were listed for hearing on 24 and 25 November 2008 before a Tribunal comprising a legal member (Member Komesaroff) and a planning member (Senior Member Baird).
6. By agreement between the parties, the declaration application was heard first by the Tribunal[3] before the enforcement proceeding on the basis that if existing use rights did exist, they were a defence to the enforcement order application. Member Komesaroff determined that the land did not have existing use rights and there was a contravention of the planning scheme.[4]
7. The council appealed to the Supreme Court. By judgment dated 27 June 2009 in Mornington Peninsula Shire Council v Anderson and Others[5], Pagone J made orders that the appeal was allowed and set aside the Tribunal's orders that existing use rights for the purpose(s) of gun range and target shooting activities, and motorcycle events and activities had not been established and use for those purposes contravened the planning scheme.
8. The council and the motorcycle club submitted that the Tribunal should make declarations that the land did enjoy existing use rights and to dismiss the enforcement order proceeding.
9. At a practice day hearing on 2 October 2009, the objectors declined to agree to the Tribunal making these declarations and requested a further hearing where they argued that the Tribunal should make the same declarations as previously made by Member Komesaroff but on a different basis.
10. This hearing was held on 10 December 2009.
11. Following that hearing before me, I directed the objectors to file and serve a full written statement of the submissions and arguments they relied upon in support of the orders they were seeking, namely that the applications for declarations in relation to motorcycling and shooting be dismissed. Other parties were given an opportunity to respond.
12. This occurred and a final order was made by the Tribunal dated 25 May 2010[6] in which I made declarations that Long Point Reserve enjoyed existing use rights for the purposes of gun range and target shooting activities, and motorcycle events and activities, pursuant to clause 63 of the Mornington Peninsula Planning Scheme. In my reasons, I commented as follows:

[7] At the hearing on 10 December 2009, Mr Porter, on behalf of the objectors, did not produce a written submission but relied on oral argument. I found it difficult to follow his line of reasoning or to fully appreciate the distinctions between the way his arguments were characterised by the Tribunal and the Supreme Court, and the way in which he was now presenting them and as he says they had been originally presented by him.

[8] In order to ensure that I properly understood what was being put to me by the objectors on this point, I directed them to file and serve a full written statement of the submissions and arguments they rely upon in support of the orders they seek in this proceeding, namely that the applications for declarations in relation to motorcycling and shooting be dismissed. Leave was given to the other parties to respond. That has now occurred. My decision is based on this material as well as on material previously submitted and submissions made at the hearing.

[9] I have not found the further written submission by the objectors particularly helpful. Much of it consists of a recitation of facts, submissions put in the earlier proceedings, the decision of the Tribunal, and Pagone J's judgment. It is still not clearly articulated as to why the objectors say their arguments put before the Tribunal and then before His Honour have not been dealt with or why I should make findings contrary to the explicit findings by Pagone J on the basis that they constitute obiter dicta and are not necessarily binding on me.

"The appeal to the Supreme Court was heard and decided without specific reference to the Council's grounds of appeal."

[11] The objectors do not elaborate on what the grounds of appeal were that were not specifically referenced. It seems to me that if the objectors believe Pagone J made an error of law, then their correct remedy is an appeal to the Court of Appeal. I do not accept that they can return to the Tribunal and argue that I should disregard the Supreme Court judgment because, in some way, it was flawed or deficient.

1. Throughout the proceedings, costs have been reserved.

Section 109(3)(d) - The nature of the proceedings

1. I consider that the two applications are inextricably interwoven and any order as to costs must relate to the proceeding as a whole.
2. The council has always acknowledged that in the absence of existing use rights, the uses were prohibited under the planning scheme. I find that the council's claim that the reserve enjoyed existing use rights was raised prior to the objectors issuing the enforcement order application. I find that the reference to existing use rights in the council's letter dated 8 October 2009 is unequivocal. I reject the objectors' submission that: "The suggestion that it was raised by the Council's Solicitors in a letter prior to commencement is verging on spurious given that the reference... was hardly definitive."
3. In any enforcement proceeding, existing use rights can be a complete defence. In the present case, the council put the objectors on notice before the proceeding commenced that existing use rights would be relied upon. In the end, the council was successful in establishing existing use rights for Long Point Reserve. I do not consider it is relevant that the existence of an error of law on the part of one Tribunal member, which was identified and overturned by the Supreme Court, has any consequence in terms of the exercise by the Tribunal of its discretion as to costs. In many cases, the Tribunal has recognised that enforcement proceedings are a type of proceeding where the normal rule set out in section 109(1) of the Victorian Civil & Administrative Tribunal Act 1998 that each party bears their own costs in a proceeding, may not apply. This approach was summarised by the Tribunal in Cotsonis v Darebin CC[7] where the Tribunal said:

[11] The starting point in any consideration of an application for costs is section 109(1) of the Victorian Civil and Administrative Tribunal Act, which establishes the basic rule that each party is to bear their own costs in a proceeding before the Tribunal. But the Tribunal may make an order awarding costs if it is satisfied that it is fair to do so having regard to the range of matters set out in section 109(3) of the Act. Whilst it should not be assumed that costs will be awarded as a matter of course in all enforcement applications, the Tribunal has tended to regard enforcement order proceedings in a different light to applications for review about the merits of planning proposals for the reasons stated by Deputy President Macnamara in Haouli and Ors v Hobsons Bay CC [2001] VCAT 433:

[24] I should also say that the structure of Section 109 does, despite Mr Peake's submission to the contrary, create a presumption that costs lie where they fall. So far as I am aware this is the light in which Section 109(1) has been seen in this and all other Lists of the Tribunal. Nevertheless, Section 109(3)(d) provides in itself a justification for departing from the general rule. Ordinary permit review proceedings might be regarded as legitimate differences of opinion between parties as to the proper exercise of administrative discretion. No party contends for a particular view of fact or law to be found by the Tribunal. Therefore, despite the outcome, in most cases nobody can be said to be "right" or "wrong" in an ordinary permit review proceeding. An enforcement proceeding however, stands in a very different character. Here, just as in ordinary court proceedings, one party alleges and another party denies a particular state of fact or law. The Tribunal is called upon to make findings of fact and to apply the law to the facts which it finds, in the same way as a court does. Hence the circumstances surrounding the matter are required to be proven by proper evidence which is taken on oath, in contradistinction to the manner in which ordinary permit review applications are conducted with matters being simply asserted in the course of submission. See for instance Svanosio v Shire of Strathfieldsaye (1989) 2 AATR 26. Nevertheless as Mrs Komesaroff observed in Bayside City Council v T.A. Campbell (1999) 3 VPR 79, 82 at [17] "there is no general rule [that costs follow the event in enforcement orders] and each case must be judged on its merits".

1. In Sweetvale Pty Ltd v Minister for Planning[8] the Tribunal considered that under section 109(3)(d), the nature and complexity of the proceeding is more likely to make it fair to make an order as to costs if:
   • the proceeding was in the tribunal's original jurisdiction, not its review jurisdiction;
   • the proceeding involved a large number of issues, or a small number of particularly complex issues;
   • the proceeding involved a large sum of money or a major issue affecting the welfare of a party or the community;
   • the proceeding succeeded and was a type which was required to be brought, either by reason of a statutory duty or by reason of some unlawful or improper conduct by another party which warranted redress;
   • the proceeding failed and was a type where a party has asserted a right which it knew, or ought to have known, was tenuous;
   • a practice has developed that costs are routinely awarded in a particular type of proceeding, thus making an award of costs more predictable for the proceeding in question.
2. In the present case, both the enforcement order and declaration proceedings were in the Tribunal's original jurisdiction, not its review jurisdiction. The proceedings involve particularly complex issues. I accept that gathering evidence about activities on the reserve since the 1980's was time consuming and involved much work on the part of the council and user groups. The legal issues associated with the existing use rights arguments were complex in term of deciphering the residents' arguments on the subject and how earlier permits affected those rights.
3. The proceedings involved significant issues affecting the council, the user groups and the community. They placed in jeopardy the future use of land purchased by the council for specific uses and the ability of the user groups to continue operation. Significant community facilities would have been rendered incapable of use if the enforcement order proceeding succeeded.
4. The nature of enforcement proceedings are such that the council had no option but to defend the proceeding. The declaration proceeding was entirely justifiable in order to clearly establish the basis and nature of any existing use rights, which were a complete defence to the enforcement proceeding.
5. There is no doubt that the objectors' proceeding failed. The objectors were forewarned that the council would rely on existing use rights and ultimately existing use rights were held to have been established under the 15 year rule in clause 63.11 of the planning scheme. The objectors advanced complex legal argument, which sought to distinguish between a characterisation of the uses during the period when they operated pursuant to a permit and subsequently after the permits expired. This argument was pursued even after the Supreme Court ruled that existing use rights had been established under clause 63.11. I consider that this argument was tenuous, especially after the Supreme Court decision. In terms of the enforcement proceeding, the objectors' arguments about nuisance were also tenuous and not abandoned until just prior to the initial Tribunal hearing.
6. As I have previously noted, costs are more routinely awarded in enforcement proceedings than in review proceedings. The same applies to declaration proceedings.[9]
7. Having regard to all these matters, I consider that the nature of these proceedings is such that an award of costs against the objectors should be made in favour of both the council and the motorcycle club as the successful parties in each proceeding.
8. The motorcycle club and other user groups[10] were joined as parties to both proceedings by direction of the Tribunal. They were groups whose interests were affected by the proceedings[11] and the Tribunal therefore considered it was desirable that they be joined as parties.
9. Although the council took the lead role both in defending the enforcement order proceeding and prosecuting the declaration proceeding, the motorcycle club also took an active role and was legally represented at most hearings. It stood to loose substantially if the objectors had succeeded. I do not accept the objectors' contention that the council's and the club's interests were always the same during these proceedings and, as the objectors took action against the council not against the club, it would be unjust to award costs against the objectors in favour of the club in these circumstances. As it has transpired, the council's interests and the club's interests have coincided, but it was entirely appropriate for the club to be independently represented in order to safeguard its interests. It was possible that their interests might have diverged, in which case it would have been very important for the club to be independently represented. I accept the motorcycle club's submissions that it has at all times sought to minimise its costs by relying where possible upon evidence and submissions made on behalf of the council.

Section 109(3)(b) responsibility for prolonging unreasonably the time taken to complete the proceeding

1. I find that the objectors have been responsible for prolonging unreasonably the time taken to complete the proceeding.
2. This is evident from the Tribunal's directions to the objectors to file further and better particulars of its claims and by the dissatisfaction expressed by the Tribunal at various times about the clarity of the objectors' claims. Examples are comments: by Deputy President Dwyer in his order dated 12 August 2008; the late abandonment of claims relating to nuisance; the direction that they file a written statement of their submission and arguments in my order of 21 December 2009; and my comments in my order dated 25 May 2010.
3. I consider that the way in which the objectors have presented their claims and submissions throughout the course of these proceedings has been prolix and confused. They have not enabled other parties or the Tribunal to readily understand the nature of the claims being made or the basis of the arguments being put.
4. I also find that the objectors' refusal to accept the finding of Pagone J in the Supreme Court appeal that existing use rights in respect of shooting and motorcycle uses were established and their desire to re-agitate these issues before the Tribunal (unsuccessfully) constituted an unreasonable prolongation of the time taken to complete the proceeding.
5. This is a further basis for awarding costs against the objectors.

1. In its letter to the objectors' solicitor dated 8 October 2007, the council highlighted its different roles as a responsible authority and planning authority under the Planning and Environment Act 1987, its lack of role as a public land manager under the planning scheme, and its role as the land owner and its responsibilities as a municipal council under the Local Government Act 1989.
2. Throughout this dispute, and even in their submissions about costs, the objectors have continuously referred to their dissatisfaction about the way in which the council handled the lease issue relating to the clubs' occupation of Long Point Reserve. However, as the council pointed out in its letter of 8 October 2007, the issue of the lease was separate to issues relating to use of the reserve under the Planning and Environment Act 1987 and the planning scheme.
3. The objectors allege in their costs application that the proceedings were taken as they were dissatisfied about the state of lease negotiations with the council. The council submits that if this is true, the proceedings were commenced for an ulterior purpose and there was never any basis for the proceedings.
4. I note that the council's initial response to the enforcement order application was to apply for a practice day hearing to have the application struck out on the basis that it was misconceived, lacking in substance or an abuse of process.
5. It does not seem to me that the residents, even now fully grasp the distinction between the council's various roles. This may account for their continuing reference to and reliance upon the lease issue.
6. From the outset, as the council warned in its letter of 8 October 2007, the lease issue was a separate issue and not to be confused with the use of the land under the planning scheme. The residents' failure to heed this warning may have been a factor in unreasonably prolonging the proceeding. However, I make no finding on this point. I have dealt with unreasonably prolonging the proceeding as a separate reason for deciding to award costs upon other grounds.
7. As a separate issue, I do not intend to speculate about the residents' motives. Accordingly, I do not rely upon the suggestion by the council that these proceedings were an abuse of process in deciding to award costs or rely upon this as an additional reason for awarding costs.

1. It has been clear from the outset that existing use rights were an issue and that the council always intended to pursue costs in the event that the objectors were not successful. The objectors can have been under no illusion that costs would not have been an issue in the event that the council established existing use rights. In my view, this is a reason why they should have been very cautious in continuing with each step of the proceeding, especially after the Supreme Court appeal.
2. However, I reject the submissions by the council and the motorcycle club that costs should be awarded on a solicitor/client basis. The Tribunal's normal practice is to award costs on a party/party basis and I see no reason to depart from this practice.
3. I note that the objectors did not make any submissions about the appropriate scale of costs or the items requested to be certified.
4. I consider it is reasonable to make an award of costs based on the Supreme Court scale of costs. I consider the scale is appropriate in this case in that it makes proper allowance for the complexity of the matters at hand, the necessity that the matters be contested and the seriousness of the consequences.
5. I also consider it is reasonable to certify the items sought by the council and the motorcycle club except for the transcript. The transcript was required for the Supreme Court appeal, not for the proceedings before the Tribunal. It should be excluded from this costs order.
6. It follows that I am not prepared to fix the quantum of the costs claimed by the motorcycle club. Rather, I will direct that in respect of both the council and the motorcycle club, in default of agreement as to quantum of costs, the quantum must be determined by the Victorian Costs Court.

[3] Consisting of Senior Member Baird and Member Komesaroff. Under section 149A(4) of the Planning and Environment Act 1987, the declaration proceeding was decided by Member Komesaroff as a legal member.

[4] Ackerman & Ors v Mornington Peninsula SC [2009] VCAT 66

[5] [2009] VSC 301

[6] Ackerman & Ors v Mornington Peninsula SC [2010] VCAT 911

[7] [2005] VCAT 1131

[8] [2004] VCAT 2000 at [19]

[9] For example, see Stewart v Bayside CC [2006] VCAT 229 at [10]

[10] Victoria Field and Game Association (Port Phillip) Inc, Mornington Peninsula Bowmen Inc, Nepean Clay Target Club Inc and Rosebud and District Motorcycle Club

[11] See section 60 Victorian Civil & Administrative Tribunal Act 1998