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[2026] NSWLEC 97
Land and Environment Court (NSW)
2026-08-07
Pritchard J
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Medium Neutral Citation: New South Wales Aboriginal Land Council v Minister Administering the Crown Land Management Act (“Leeton Courthouse claim”) (No 2) [2026] NSWLEC 97
Hearing dates: On the papers, submissions received 3, 10 and 14 July 2026
Date of orders: 7 August 2026
Decision date: 07 August 2026
Jurisdiction: Class 3
Before: Pritchard J
Decision: The Court makes the following order:
(1) Pursuant to s 98 of the Civil Procedure Act 2005 (NSW), Minister Administering the Crown Land Management Act to pay the applicant’s costs of the proceedings on the ordinary basis.
Catchwords: COSTS – costs application in Class 3 Aboriginal land rights appeal proceedings – applicant successful in appeal and seeks costs on ordinary and indemnity basis – whether costs should be determined when notice of intention to appeal had been filed – whether general rule that costs follow the event applies in Class 3 Aboriginal land rights appeal proceedings – source of the Court’s power to make a costs order in Class 3 Aboriginal land rights appeal proceedings – effect of the Courts and Other Legislation Further Amendment Act 2011 – discretion in s 98 of the Civil Procedure Act – whether Minister’s conduct warranted award of costs on an indemnity basis – whether it was unreasonable to reject offer of compromise
General information, not legal advice.
Legislation Cited: Aboriginal Land Rights Act 1983 (NSW) s 36
Civil Procedure Act 2005 (NSW) ss 4, 98, Sch 1
Court Security Act 2005 (NSW)
Courts and Other Legislation Further Amendment Act 2011 (NSW)
Land and Environment Court Act 1979 (NSW) ss 19
Land and Environment Court Rules 2007 (NSW) r 3.7
Public Works Act 1912 (NSW)
Uniform Civil Procedure Rules 2005 (NSW) rr 20.26, 42.1, 42.14, 42.19, 42.20, 51.8, 51.16, Sch 1
Cases Cited: BBLT v Chief Commissioner of the Office for State Revenue (2003) 54 ATR 323; [2003] NSWSC 1003
Birrigan Gargle Aboriginal Land Council v Minister Administering the Crown Lands Act (No 2) [1999] NSWLEC 123
Birrigan Gargle Local Aboriginal Land Council v Minister Administering the Crown Lands Act (No 2) (1993) 81 LGERA 137
Birrigan Gargle Local Aboriginal Land Council v Minister Administering the Crown Lands Act (1993) 80 LGERA 389
Darkinjung Local Aboriginal Land Council v Minister Administering the Crown Lands Act and Anor (No 2) [2007] NSWLEC 523
Dunstan v Rickwood (No 2) [2007] NSWCA 266
Electoral Commissioner of the Australian Electoral Commission v Laming (No 3) [2023] FCA 1385
Oshlack v Richmond City Council (1998) 193 CLR 72; [1998] HCA 11
Milne v Attorney-General for the State of Tasmania (1956) 95 CLR 460; [1956] HCA 48
Narromine Local Aboriginal Council v Minister Administering the Crown Lands Act (1993) 79 LGERA 430
New South Wales Aboriginal Land Council v Minister Administering the Crown Land Management Act (“Leeton Courthouse claim”) [2026] NSWLEC 69
New South Wales Aboriginal Land Council v Minister Administering the Crown Land Management Act (Leeton Courthouse) [2025] NSWLEC 69
New South Wales Aboriginal Land Council v Minister Administering The Crown Lands (Consolidation) Act and The Western Lands Act (1988) 14 NSWLR 685
New South Wales Aboriginal Land Council v Minister Administering the Crown Lands Act (2016) 260 CLR 232; [2016] HCA 50
Tickell v Trifleska Pty Ltd (1990) 25 NSWLR 353
Texts Cited: Second Reading Speech for the Courts and Other Legislation Further Amendment Bill 2011, Hansard, 26 August 2011
Category: Costs
Parties: New South Wales Aboriginal Land Council (Applicant)
Minister Administering the Crown Land Management Act (Respondent)
Representation: Counsel:
O Jones (Applicant)
O Berkmann (Respondent)
Solicitors:
Chalk & Behrendt (Applicant)
Crown Solicitor’s Officer (Respondent)
File Number(s): 2023/450075
Publication restriction: Nil
On 12 June 2026, I delivered judgment in New South Wales Aboriginal Land Council v Minister Administering the Crown Land Management Act (“Leeton Courthouse claim”) [1] (Leeton Courthouse 2026) upholding the appeal by the New South Wales Aboriginal Land Council (NSWALC) from the decision of the Minister Administering the Crown Land Management Act by their delegate on 25 August 2023 to refuse Aboriginal Land Claim 51922 lodged by NSWALC on 26 August 2020 over land comprising Lot 1, Section 42 in DP 758606 in the town of Leeton, New South Wales.
On 18 June 2026, I made orders in relation to costs that:
The applicant file and serve any evidence and submissions (not exceeding 10 pages) by 3 July 2026.
The respondent file and serve any evidence and submissions (not exceeding 10 pages) by 10 July 2026.
The applicant file and serve any submissions in reply (not exceeding 5 pages) by 15 July 2026.
In submissions filed on 3 July 2026, NSWALC contends that it is entitled to:
an order for its legal costs on an ordinary basis between 13 December 2023 and 28 August 2024, and
an order for its costs on an indemnity basis between 29 August 2024 and 12 June 2026.
NSWALC relies in support of the costs orders it seeks on an affidavit of Christopher Malcolm Turner affirmed 1 July 2026 (the Turner affidavit).
In submissions filed on 10 July 2026, the Minister opposed the costs orders sought by NSWALC on four grounds:
(a) firstly, the Minister has filed a notice of intention to appeal (r 51.8 of the Uniform Civil Procedure Rules 2005 (UCPR)) and the appropriate course is to stay any order as to costs pending the outcome of the appeal proceedings; (b) secondly, r 42.1 (General rule that costs follow the event), Part 20 Div 4 (Compromise) and Part 42 Div 3 (Offers of compromise) of the UCPR upon which the applicant relies do not apply to Class 3 Aboriginal land rights appeals by reason of Column 4 in Schedule 1 to the UCPR; (c) thirdly, the decision of Bignold J in Birrigan Gargle Aboriginal Land Council v Minister Administering the Crown Lands Act (No 2) [2] (Yamba Waters No 2) is distinguishable and to the extent that the authorities assist the Court, such cases do not suggest costs follow the event; and (d) fourthly, no genuine offer of compromise was put by NSWALC – Tickell v Trifleska Pty Ltd [3] (Tickell v Trifleska) – and it was reasonable for the Minister to reject the applicant’s offer.
The Minister’s approach is in error. There is no appeal presently on foot, but even if there was, it would not be a reason for the Court not to make any appropriate costs order now. As McColl JA (with whom Beazley and Ipp JJA agreed) said in Dunstan v Rickwood (No 2) [2007] NSWCA 266 at [54], “[a] primary judge should always rule on the costs of the trial, including any application for indemnity costs. That judge is in the best position to determine the issues relevant to such orders”...
The background relevant to the question of costs of the proceedings is largely set out in the Turner affidavit and can be summarised as follows.
On 13 December 2023, NSWALC filed the Class 3 application commencing the proceedings.
On 7 June 2024, the Minister filed a statement of facts and contentions (SOFAC).
On 23 August 2024, NSWALC filed a SOFAC in reply.
On 28 August 2024, NSWALC made an offer of compromise, said to be made pursuant to r 20.26 of the UCPR (the o****ffer), to a solicitor employed by the Crown Solicitor’s Office who then had carriage of the matter for the Minister. That offer was open for acceptance for 28 days and was to compromise the whole of the proceedings on the following terms:
The respondent transfer Lot 1, Section 42, Deposited Plan 758606 in fee simple to Leeton and District Local Aboriginal Land Council.
The respondent do all things necessary to transfer Lot 1, Section 42, Deposited Plan 758606, including any surveys, within 6 months of consent orders being made.
Each party bear their own costs.
The offer provided that, if it was accepted, Leeton and District Local Aboriginal Land Council would offer a licence to relevant government entities to park cars on Lot 1, Section 42, DP 758606 for a period of 5 years. The offer also set out why, in NSWALC’s view, the offer was reasonable.
On 17 September 2024, the Minister’s solicitor requested that the acceptance date for the offer of compromise be extended until after the parties had attended a conciliation conference fixed for 21 October 2024.
On 26 September 2024, NSWALC wrote to the Minister and advised that the acceptance date for the offer would be extended until 14 October 2024, one week prior to the conciliation conference. That letter also provided further particulars of NSWALC’s assertions in relation to the Minister’s case.
On 21 October 2024, the parties attended a conciliation conference.
Between 14 October 2024 and 29 November 2024, the parties exchanged correspondence in relation to NSWALC’s offer. By letter on 29 November 2024, the Minister rejected the offer.
On 25 June 2025, the Minister filed a notice of motion seeking leave to further amend the SOFAC. On 1 July 2025, Justice Pepper heard the Minister’s notice of motion and on 2 July 2025 granted leave to the Minister to amend the SOFAC (and leave to NSWALC to further amend the SOFAC in reply), and also made an order that “the Minister is to pay the Land Council’s reasonable costs incurred in relation to the s 34 conciliation conference held on 21 October 2024”: New South Wales Aboriginal Land Council v Minister Administering the Crown Land Management Act (Leeton Courthouse) [4] (Leeton Courthouse 2025) per Pepper J at [45] and [47]. Orders 2 and 3 made by her Honour provided:
(2) the Minister is to pay the Land Council’s reasonable costs thrown away resulting from amendments made to the Minister’s Statement of Facts and Contentions;
(3) the Minister is to pay the Land Council’s reasonable costs incurred in relation to the s 34 conciliation conference held on 21 October 2024;
By operation of s 4 of the Civil Procedure Act 2005 (NSW) (CPA), together with Schedule 1 to that Act, Parts 3 to 9 of the CPA apply to all civil proceedings in, inter alia, Class 3 of the jurisdiction of the Land and Environment Court.
In Part 7 of the CPA, s 98(1) provides as follows in relation to courts’ powers as to costs:
(1) Subject to rules of court and to this or any other Act--
(a) costs are in the discretion of the court, and
(b) the court has full power to determine by whom, to whom and to what extent costs are to be paid, and
(c) the court may order that costs are to be awarded on the ordinary basis or on an indemnity basis.
42.1 General rule that costs follow the event
Subject to this Part, if the court makes any order as to costs, the court is to order that the costs follow the event unless it appears to the court that some other order should be made as to the whole or any part of the costs.
42.14 Where offer not accepted and judgment no less favourable to plaintiff
(1) This rule applies if the offer is made by the plaintiff, but not accepted by the defendant, and the plaintiff obtains an order or judgment on the claim no less favourable to the plaintiff than the terms of the offer.
(2) Unless the court orders otherwise, the plaintiff is entitled to an order against the defendant for the plaintiff’s costs in respect of the claim—
(a) assessed on the ordinary basis up to the time from which those costs are to be assessed on an indemnity basis under paragraph (b), and
(b) assessed on an indemnity basis—
(i) if the offer was made before the first day of the trial, as from the beginning of the day following the day on which the offer was made, and
(ii) if the offer was made on or after the first day of the trial, as from 11 am on the day following the day on which the offer was made.
20.26 Making of offer
(1) In any proceedings, any party may, by notice in writing, make an offer to any other party to compromise any claim in the proceedings, either in whole or in part, on specified terms.
(2) An offer under this rule—
(a) must identify—
(i) the claim or part of the claim to which it relates, and
(ii) the proposed orders for disposal of the claim or part of the claim, including, if a monetary judgment is proposed, the amount of that monetary judgment, and
(b) if the offer relates only to part of a claim in the proceedings, must include a statement—
(i) in the case of an offer by the plaintiff, as to whether the balance of the proceedings is to be abandoned or pursued, or
(ii) in the case of an offer by a defendant, as to whether the balance of the proceedings will be defended or conceded, and
(c) must not include an amount for costs and must not be expressed to be inclusive of costs, and
(d) must bear a statement to the effect that the offer is made in accordance with these rules, and
(e) if the offeror has made or been ordered to make an interim payment to the offeree, must state whether or not the offer is in addition to that interim payment, and
(f) must specify the period of time within which the offer is open for acceptance.
(3) An offer under this rule may propose—
(a) a judgment in favour of the defendant—
(i) with no order as to costs, or
(ii) despite subrule (2)(c), with a term of the offer that the defendant will pay to the plaintiff a specified sum in respect of the plaintiff’s costs, or
(b) that the costs as agreed or assessed up to the time the offer was made will be paid by the offeror, or
(c) that the costs as agreed or assessed on the ordinary basis or on the indemnity basis will be met out of a specified estate, notional estate or fund identified in the offer.
(4) If the offeror makes an offer before the offeree has been given such particulars of the offeror’s claim, and copies or originals of such documents available to the offeror, as are necessary to enable the offeree to fully consider the offer, the offeree may, within 14 days of receiving the offer, give notice to the offeror that—
(a) the offeree is unable to assess the reasonableness of the offer because of the lack of particulars or documents, and
(b) in the event that rule 42.14 applies to the proceedings, the offeree will seek an order of the court under rule 42.14(2).
(5) The closing date for acceptance of an offer—
(a) in the case of an offer made two months or more before the date set down for commencement of the trial—is to be no less than 28 days after the date on which the offer is made, and
(b) in any other case—is to be such date as is reasonable in the circumstances.
(6), (7) (Repealed)
(8) Unless the notice of offer otherwise provides, an offer providing for the payment of money, or the doing of any other act, is taken to provide for the payment of that money, or the doing of that act, within 28 days after acceptance of the offer.
(9) An offer is taken to have been made without prejudice, unless the notice of offer otherwise provides.
(10) A party may make more than one offer in relation to the same claim.
(11) Unless the court orders otherwise, an offer may not be withdrawn during the period of acceptance for the offer.
(12) A notice of offer that purports to exclude, modify or restrict the operation of rule 42.14 or 42.15 is of no effect for the purposes of this Division.
(1) This rule applies to the following proceedings (except for appeals under section 56A of the Act)--
(a) all proceedings in Class 1 of the Court's jurisdiction,
(b) all proceedings in Class 2 of the Court's jurisdiction,
(c) the following proceedings in Class 3 of the Court's jurisdiction--
(i) appeals, references or other matters that may be heard and disposed of by the Court under the Crown Lands Act 1989 or Western Lands Act 1901, as referred to in section 19(a) of the Land and Environment Court Act 1979,
(ii) appeals under section 37(1) of the Valuation of Land Act 1916,
(iii) appeals under section 8E of the Rookwood Necropolis Act 1901 or clause 56(2) of Schedule 8 to the Crown Lands Act 1989,
(iv) appeals and applications under section 526 (including section 526 as applied by section 531) or 574 of the Local Government Act 1993,
(v) appeals under section 202 of the Fisheries Management Act 1994,
(vi) appeals under section 174, and references under section 175, of the Aboriginal Land Rights Act 1983,
(vii) any other appeals, references or other matters referred to in section 19(h) of the Land and Environment Court Act 1979.
19 Class 3--land tenure, valuation, rating and compensation matters
The Court has jurisdiction (referred to in this Act as "Class 3" of its jurisdiction) to hear and dispose of the following—
(a) appeals, references or other matters that may be heard and disposed of by the Court under the Crown Land Management Act 2016 or Division 2 of Part 12 of the Roads Act 1993, being appeals, references or other matters that are not referred to in any other section of this Part,
(b) appeals under section 37(1) of the Valuation of Land Act 1916,
(c) appeals against boundary determinations under Part 14A (Boundary determinations) of the Real Property Act 1900,
(c1) proceedings under the Encroachment of Buildings Act 1922,
(d) appeals and applications under sections 179, 181, 526 (and section 526 as applied by section 531), 574, 677 and 730 of the Local Government Act 1993,
(d1) appeals under section 64 of the Fire and Emergency Services Levy Act 2017,
(e) claims for compensation by reason of the acquisition of land, referred to in Division 2,
(e2) proceedings under sections 29, 30 and 31 of the Access to Neighbouring Land Act 2000,
(e3) appeals under section 22 or 24 of the Lord Howe Island Act 1953,
(f1) appeals under section 16 of the Coal Mine Subsidence Compensation Act 2017,
(g) proceedings to recover compensation payable pursuant to sections 4.57(7) and 8.19 of the Environmental Planning and Assessment Act 1979,
(g1) appeals under section 44, 202 or 220AA of the Fisheries Management Act 1994,
(g2) appeals under section 36(7) or 174 of the Aboriginal Land Rights Act 1983,
(g3) references under section 175 of the Aboriginal Land Rights Act 1983,
(g4) claims for compensation under section 71X of the Water Management Act 2000,
(g5) applications under section 40(2) of this Act,
(g6) applications and proceedings under Divisions 6, 7 and 8 of Part 10 of the Strata Schemes Development Act 2015,
(h) any other appeals, references or other matters which an Act provides may be heard and disposed of by the Court, being appeals, references or other matters that are not referred to in any other section of this Part.
(a) that the proceedings involve, as a central issue, a question of law, a question of fact or a question of mixed fact and law, and the determination of such question--
(i) in one way was, or was potentially, determinative of the proceedings, and
(ii) was preliminary to, or otherwise has not involved, an evaluation of the merits of any application the subject of the proceedings,
(b) that a party has failed to provide, or has unreasonably delayed in providing, information or documents--
(i) that are required by law to be provided in relation to any application the subject of the proceedings, or
(ii) that are necessary to enable a consent authority to gain a proper understanding of, and give proper consideration to, the application,
(c) that a party has acted unreasonably in circumstances leading up to the commencement of the proceedings,
(d) that a party has acted unreasonably in the conduct of the proceedings,
(e) that a party has commenced or defended the proceedings for an improper purpose,
(f) that a party has commenced or continued a claim in the proceedings, or maintained a defence to the proceedings, where--
(i) the claim or defence (as appropriate) did not have reasonable prospects of success, or
(ii) to commence or continue the claim, or to maintain the defence, was otherwise unreasonable.
19 Class 3--land tenure, valuation, rating and compensation matters
The Court has jurisdiction (referred to in this Act as "Class 3" of its jurisdiction) to hear and dispose of the following—
(a) appeals, references or other matters that may be heard and disposed of by the Court under the Crown Land Management Act 2016 or Division 2 of Part 12 of the Roads Act 1993, being appeals, references or other matters that are not referred to in any other section of this Part,
(b) appeals under section 37(1) of the Valuation of Land Act 1916,
(c) appeals against boundary determinations under Part 14A (Boundary determinations) of the Real Property Act 1900,
(c1) proceedings under the Encroachment of Buildings Act 1922,
(d) appeals and applications under sections 179, 181, 526 (and section 526 as applied by section 531), 574, 677 and 730 of the Local Government Act 1993,
(d1) appeals under section 64 of the Fire and Emergency Services Levy Act 2017,
(e) claims for compensation by reason of the acquisition of land, referred to in Division 2,
(e2) proceedings under sections 29, 30 and 31 of the Access to Neighbouring Land Act 2000,
(e3) appeals under section 22 or 24 of the Lord Howe Island Act 1953,
(f1) appeals under section 16 of the Coal Mine Subsidence Compensation Act 2017,
(g) proceedings to recover compensation payable pursuant to sections 4.57(7) and 8.19 of the Environmental Planning and Assessment Act 1979,
(g1) appeals under section 44, 202 or 220AA of the Fisheries Management Act 1994,
(g2) appeals under section 36(7) or 174 of the Aboriginal Land Rights Act 1983,
(g3) references under section 175 of the Aboriginal Land Rights Act 1983,
(g4) claims for compensation under section 71X of the Water Management Act 2000,
(g5) applications under section 40(2) of this Act,
(g6) applications and proceedings under Divisions 6, 7 and 8 of Part 10 of the Strata Schemes Development Act 2015,
(h) any other appeals, references or other matters which an Act provides may be heard and disposed of by the Court, being appeals, references or other matters that are not referred to in any other section of this Part.
| Column 1 | Column 2 | Column 3 | Column 4 | | Court | Kinds of civil proceedings | Excluded provisions of Civil Procedure Act 2005 | Excluded provisions of rules | | Land and Environment Court | Proceedings in Class 1, 2 or 3 of its jurisdiction, other than proceedings under section 56A of the Land and Environment Court Act 1979 | | Part 34 (except to the extent to which the Commission orders that the Part is to apply) Parts 37, 38 and 39 Parts 42 and 43 Part 46 Part 6, Divisions 2 and 4 Part 6, Divisions 2 and 4 Part 20, Division 4, and Part 42, Division 3, in relation to all proceedings other than those referred to in: (a) section 19(a), (c), (c1), (e), (e2), (e3), (f), (f1) or (g) or 40 of the Land and Environment Court Act 1979, or (b) section 179, 181, 677 or 730 of the Local Government Act 1993, or (c) section 44 of the Fisheries Management Act 1994 Rules 42.1, 42.6, 42.8, 42.9, 42.18, 42.19 and 42.20 | | | Proceedings in Class 4 or 8 of its jurisdiction | | |
It appears to have been common ground that r 3.7 of the LEC Rules does not apply to the present proceedings. That is because the subset of Class 3 proceedings to which r 3.7 applies are the proceedings specified in r 3.7(1)(c)(i) to (vi), as well as “any other appeals, references or other matters referred to in s 19(h) of the Land and Environment Court Act 1979”: r 3.7(1)(c)(vii). The Class 3 proceedings specified in r 3.7(1)(c) to (vi) do not include appeals to the Court under s 36(7) of the Aboriginal Land Rights Act 1983 (NSW) (ALRA) from a refusal under s 36(5)(b) of a claim for land made by NSWALC on its own behalf or on behalf of one or more Local Aboriginal Land Councils.
Nor do the “any other appeals, references or other matters referred to in s 19(h) of the Land and Environment Court Act 1979” include appeals to the Court under s 36(7) of the ALRA from a refusal under s 36(5)(b) of a claim for land made by NSWALC on its own behalf or on behalf of one or more Local Aboriginal Land Councils. That is because of the specific provision in s 19(g2) which provides that the Court has jurisdiction (referred to in this Act as “Class 3” of its jurisdiction) to hear and dispose of “(g2) appeals under section 36(7) or 174 of the Aboriginal Land Rights Act 1983”.
Likewise, it appears to have been common ground that until the coming into force of the Courts and Other Legislation Further Amendment Act 2011 on 13 September 2011, an appeal pursuant to s 36(7) of the ALRA came within the jurisdiction conferred by the “catch all’ provision in s 19(h) of the LEC Act, and was subject to r 3.7 of the LEC Rules, including r 3.7(2) which provides that the Court is not to make an order for the payment of costs “unless the Court considers that the making of an order as to the whole or any part of the costs is fair and reasonable in the circumstances”.
However, the effect of the amendments to the LEC Act made in 2011 was to include appeals under s 36(7) of the ALRA in the list of Class 3 matters referred to in s 19 of the LEC Act: see s 19(g2) of the LEC Act and the Second Reading Speech for the Courts and Other Legislation Further Amendment Bill 2011, 26 August 2011, introduced on motion by the Attorney General and Minister for Justice Greg Smith. [5] In the Second Reading Speech, the Hon Greg Smith said:
The Chief Judge of the Land and Environment Court has written expressing concern about this issue, particularly because, on one view of the legislation, an appeal under section 36(7) of the Aboriginal Land Rights Act 1983 could fall within class 4 of the court's jurisdiction. There would be significant implications if, contrary to usual practice, these appeals were treated as class 4 matters, which relate to environmental planning and protection laws. Importantly, unlike class 4 matters, class 3 matters are hearings de novo, meaning that appeals are heard by way of rehearing, and fresh evidence may be considered.
It follows that the present Class 3 proceedings fall within the specific jurisdiction conferred on the Court by s 19(g2) of the LEC Act, and not within the jurisdiction conferred by the “catch-all’ provision in s 19(h).
The question which arises is whether, as contended by NSWALC, these Class 3 civil proceedings not being proceedings specified in r 3.7(1)(c) of the LEC Rules, the source of the Court’s power to make a costs order is s 98 of the CPA “read with rule r 42.1 of the UCPR” which provides that costs follow the event and r 42.14 of the UCPR which provides for the recovery of costs on an indemnity basis; or whether, as contended by the Minister, the removal of Class 3 Aboriginal land claims from the ambit of the LEC Rules did not result in introducing r 42.1 and the offer of compromise provisions in the UCPR to the determination of costs in appeals to the Court under s 36(7) of the ALRA, those provisions not applying to Class 3 Aboriginal land rights appeals by reason of Column 4 in Schedule 1 to the UCPR.
In its submissions in chief, NSWALC submitted that the principles governing the Court’s discretion as to costs are as follows:
where the claimant land council is successful, a costs order in favour of the claimant should be made unless there is some circumstance justifying a departure from the ordinary compensatory rule (noting in addition to the matters referred to by Bignold J in Yamba Waters No 2, also now r 42.1 of the UCPR (General rule that costs follow the event)); [6] and
where the Minister is successful (a matter that does not arise in this case and therefore does not need to be determined) the appropriate order is that each party bear their own costs, or that there be no order as to costs, unless there are circumstances justifying some other order (for instance, because the land council’s appeal was hopeless or without proper justification (see Yamba Waters No 2 at [55]).
NSWALC submitted that the costs application should be decided on the basis of the principles identified by Bignold J in Yamba Waters No 2, there being no error in his Honour’s reasoning, and it taking proper account of the remedial and beneficial nature of the ALRA.
NSWALC submitted that the Court should order the Minister:
to pay the applicant’s costs of the proceedings on an ordinary basis between 13 December 2023 and 28 August 2024 (being the day on which the applicant made its offer of compromise); and
to pay the applicant’s costs of the proceedings on an indemnity basis between 29 August 2024 (being the day following the day on which the applicant made its offer of compromise) and 12 June 2026.
NSWALC submitted that in accordance with the principles set out in Yamba Waters No 2, where a claimant land council is successful in vindicating its statutory rights through an appeal, costs should ordinarily follow the event. The applicant’s appeal was upheld, and there were no exceptional circumstances that would justify the departure from the ordinary rule in the present case. The respondent should therefore be ordered to pay the applicant’s costs on an ordinary basis from the date the proceeding was commenced, until 25 September 2025, the day the offer of compromise expired.
In its submissions in chief, NSWALC further submitted that even if its submissions in relation to costs in the Class 3 jurisdiction were not accepted, r 42.14(2)(a) of the UCPR “provides a separate basis in this proceeding for the Applicant to recover its costs on an ordinary basis”.
Co**sts on an indemnity basis
In relation to the question of costs on an indemnity basis, the applicant’s offer was for Lot 1 to be transferred to the Leeton and District Local Aboriginal Land Council, with each party to bear their own costs, with Leeton and District Local Aboriginal Land Council to offer a licence to relevant government entities to park cars on Lot 1 for a period of 5 years. The result obtained by the applicant was submitted to be significantly more favourable than what was contemplated by the applicant’s offer “as the applicant is now under no obligation to issue a licence over Lot 1 to any government entity”. Given that the applicant made its offer of compromise well before the first day of the trial, r 42.14 (2)(b)(i) provides for costs to be assessed on an indemnity basis from the beginning of the day following the day on which the offer was made. As the offer was made on 28 August 2024, costs are to be assessed on an indemnity basis from 29 August 2024.
NSWALC referred to the decision of Pepper J on 2 July 2026 in Leeton Courthouse 2025 which required the Minister to pay the applicant’s costs thrown away by the amendment to the Minister’s SOFAC (Order 2), including the costs of the s 34 conciliation conference prior to leave to amend being granted (Order 3). NSWALC submitted that Orders 2 and 3 made by Pepper J contemplating an award of costs on an ordinary basis should be vacated. In light of the findings of 12 June 2026 in the substantive proceedings and the Minister’s rejection of the applicant’s offer of compromise, r 42.14 would otherwise allow those same costs to be recovered on an indemnity basis.
The Minister submitted that the reason for the amendment to s 19 of the LEC Act made by the Courts and Other Legislation Further Amendment Act 2011 from 13 September 2011 “did not concern nor seemingly intend to alter the cost regime in respect of Class 3 Aboriginal land claims, but by doing so removed such proceedings within the ambit of r 3.7 of the LEC Rules”. The amendment was submitted “to fortify the existing practice of Aboriginal land claims to be determined by way of Class 3 proceedings instead of potentially within Class 4 proceedings, which unlike Class 3 proceedings were not treated as de novo matters”.
Further, the Minister submitted, the removal of Class 3 Aboriginal land claims from the ambit of the LEC Rules did not result in introducing r 42.1 or the offer of compromise provisions under the UCPR. Rather, the historical context of s 19(h) of the LEC Act “having been deliberately omitted from Column 4 of Schedule 1 of the UCPR (and no further amendment to include s 19(g2) thereafter)” was submitted to support the position that ordinarily there is to be no order as to costs in respect of Aboriginal land claims.
That view was submitted to be further fortified by reason that r 42.19 (Proceedings discontinued) and r 42.20 (Dismissal of proceedings etc) of the UCPR are further excluded in Class 3 Aboriginal land claims under Column 4 of Schedule 1. In the absence of those excluded rules, the usual course would be for the applicant to pay the respondent’s costs upon discontinuance or dismissal of Class 3 Aboriginal land claims proceedings in the LEC.
The applicant’s reliance on r 42.1 and particularly r 42.14(2)(a) and (b) of the UCPR risked the Court falling into error, there being “no basis upon which ordinary or indemnity costs can be awarded by effect of its offer of compromise dated 28 August 2024, pursuant to r 42.14(2)(a) or (b) of the UCPR”.
Further, the Minister submitted, the authorities “strongly suggest” that the ordinary course in Class 3 Aboriginal land claims is for each party to pay their own costs.
In Narromine Local Aboriginal Council v Minister Administering the Crown Lands Act [7] (Narromine) Stein J at 433 to 434 considered it appropriate for the Court to form the opinion that, in the ordinary course of Class 3 appeals concerning Aboriginal land claims, no orders for costs ought be made whatever the result, and that this situation should pertain in the absence of exceptional or special circumstances which may concern the conduct of a party to the litigation. The approach of Stein J in Narromine was adopted by Pearlman CJ of LEC in Birrigan Gargle Local Aboriginal Land Council v Minister Administering the Crown Lands Act (No 2) [8] (Birrigan Gargle No 2) at [140] to [141].
The decisions in Narromine and Birrigan Gargle No 2 were submitted to be consistent with the approach taken in r 3.7(1)(a) to (c) of the LEC Rules and Column 4 of Schedule 1 of the UCPR which excludes rr 42.1 (General rule that costs follow the event), 42.19 (Proceedings discontinued), 42.20 (Dismissal of proceedings etc) and offers of compromises from the rules in the UCPR. Under both, proceedings in Class 1 and Class 2, and Class 3 Aboriginal land claims are treated similarly on the question of costs; that is, that ordinarily costs do not follow the event.
Contrary to NSWALC’s submissions, Yamba Waters No 2 was submitted to be distinguishable, having been decided “prior to r 3.7 of the LEC Rules” and before Parliament’s “deliberate omission” of the general rule that cost follow the event (r 42.1) and Part 20 Div 4 (Compromise) and Part 42 Div 3 (Offers of compromise) of the UCPR in respect of Class 3 Aboriginal land claims. In Yamba Waters No 2, the Court did not consider these issues. To the extent that they assist the Court, Narromine, and Birrigan Gargle No 2 “closer align to the relevant principles over those in Yamba Water**s No 2”.
To the extent that exceptional circumstances arise warranting any award of costs, the Minister submitted that that question was dealt with by Pepper J on 2 July 2025 by way of Orders 2 and 3. The costs awarded by Pepper J were submitted to represent a significant portion of the applicant’s costs and would exceed the costs sought on an ordinary basis between 13 December 2023 and 28 August 2024. Moreover, no cogent grounds were presented for any award of indemnity costs (or ordinary costs) for the period of 29 August 2024 to 12 June 2026 or any earlier period.
Alternatively, the Minister submitted, for the applicant to attract the costs sanctions in r 42.14 of the UCPR, there must be a genuine offer of compromise that meets the requirements of r 20.26. The purported offer of compromise dated 28 August 2024 fell short of that requirement, the “offer” not being a true offer of compromise, but rather a demand (under threat of indemnity costs) for total capitulation on the part the respondent. The offer for the land to be licenced to a relevant government entity was a proposed commercial transaction of significant financial benefit to the applicant.
In Tickell v Trifleska Rogers CJ Comm D at 355 observed that a demand by a party for payment of everything to which it may possibly be entitled would hardly fall in the category of a compromise:
Unless circumstances are wholly exceptional a demand for payment to the plaintiff of everything, to which it may possibly be entitled, hardly falls in the category of the compromise. It is true, as Mr Campbell pointed out, that there are difficulties in cases of a claim for liquidated damages when one is called upon to formulate an offer of compromise. He suggested that it was inconceivable that a court should be required, in the circumstances of Pt 52, r 17(4), to have to decide in each and every case whether an offer represented a bona fide compromise. With respect I do not think it is inconceivable at all. What the court is invited to do is to determine whether, in the totality of the circumstances, the offer by the plaintiff represented any element of compromise or whether it was merely, yet another, formally stated demand for payment designed simply to trigger the entitlement to payment of costs on an indemnity basis.
It was never in the minds of the draftsmen of the rule, or the members of the Rule Committee responsible for the passing of this rule, that Pt 22 should be utilised simply as a statutory demand which, other circumstances being equal, will automatically entail the payment of costs on an indemnity basis.
These observations were submitted to apply equally here. There was no basis for an award of costs (on either an ordinary or indemnity basis) on the ground that the applicant issued “a compliant offer of compromise”. The Minister denied that any other ground exists for a costs award against the Minister, save as to Orders 2 and 3 made by Pepper J on 2 July 2025.
Further, the Minister submitted, it was reasonable for the respondent to have rejected the offer of the applicant. Firstly, the offer made under letter dated 28 August 2024 did not sufficiently articulate the reasons why a refusal by the respondent would be unreasonable. The offer was made in circumstances where the parties had agreed and orders were made for a s 34 conciliation conference to occur on 21 October 2024. The offer was inconsistent with what had been agreed and notably expired on 25 September 2024 prior to the s 34 conciliation conference. The acceptance of the offer would have denied the parties the opportunity to attend the s 34 conference. The request by the respondent to extend the offer until after the s 34 conciliation conference (which was ultimately agreed to by the applicant) was reasonable and consistent with the just, quick and cheap resolution of the proceedings. Further, the applicant’s assertion that the land remained “unoccupied” was untenable in light of no evidence having been filed by the applicant and the respondent’s four affidavits suggesting otherwise. The factual assertion that the land was unoccupied was incorrect as the Court ultimately found that the land was used or occupied (but not lawfully): Leeton Courthouse 2026 at [124] and [137].
Secondly, an authority cannot be prevented from carrying out the public duties cast upon it by legislation: BBLT v Chief Commissioner of the Office for State Revenue [9] at [111] (and the authorities cited). Here, the Minister was tasked with carrying out duties to administer the ALRA*.* The respondent could not accept the offer in the absence of being satisfied that the land was “claimable crown lands”. The offer required the land be transferred in fee simple to the Leeton and District Local Aboriginal Land Council. That necessitated not only that the land ceased to be subject to the Public Works Act 1912 (NSW), but also that the conditions under s 36(1) of the ALRA had been met. That concerned complex questions of law, both in respect of the application of the Berrima Gaol decision [10] at [61] to [62], as well as the meaning of “court premises” in the Court Security Act 2005 (NSW). None of those legal questions had previously been determined.
Finally, the Minister submitted, the removal of Class 3 Aboriginal land claims from the LEC Rules did not have the effect of displacing “the exclusion of certain rules within the UCPR which give rise to a cost position that costs do not ordinarily follow the event”. Should the Court find that r 42.1 of the UCPR and offers of compromise under the UCPR do apply to Class 3 Aboriginal land claims, then so must r 42.19 and r 42.20 of the UCPR in relation to proceedings discontinued or dismissed. In any event, the facts and legal issues of the case make it one where the Court should “otherwise order” as the overall justice of the case warrants some other order. For those same reasons, it was not unreasonable for the respondent to reject the Calderbank offer in all the circumstances of the case.
In reply, NSWALC accepted that r 42.1 (General rule that costs follow the event), Part 20 Div 4 (Compromise) and Part 42 Div 3 (Offers of compromise) of the UCPR are excluded in relation to Class 3 Aboriginal land claim proceedings by Sch 1 of the UCPR. However, it was also correct, as appeared to be common ground, that r 3.7 of the LEC Rules does not apply.
NSWALC submitted that the relevant source of the Court’s power to make a costs order is therefore s 98 of the CPA which provides that “costs are in the discretion of the court” (sub-s 1(a)) and that the Court “has full power to determine by whom, and to whom and to what extent costs are paid” (sub-s 1(b)). While the Court has a wide discretion pursuant to such a power, ordinarily a successful party should not be deprived of costs unless there is material to justify a contrary order being made, citing the decision of the High Court in Milne v Attorney-General for the State of Tasmania [11] at 477 (Dixon CJ, McTiernan, Williams, Fullagar and Taylor JJ).
Section 98 of the CPA was submitted to be identical to the now repealed s 69 of the LEC Act which was applied by Bignold J in Yamba Waters No 2. In relation to the Minister’s reliance on extrinsic materials for the submission that the amendment to the LEC Act which removed Class 3 Aboriginal land claim proceedings from the scope of r 3.7 of the LEC Rules was not intended to alter the costs regime applicable to such claims, NSWALC submitted that the approach was erroneous, the text of the LEC Act and the LEC Rules making it clear that r 3.7 of the LEC Rules has no application (as appeared to be common ground).
Further or alternatively, NSWALC submitted that even if the approach under r 3.7 of the LEC Rules is to be applied, it is fair and reasonable to make the orders sought by the applicant in the circumstances of these proceedings. As evidenced by the material annexed to the Turner affidavit, the applicant made a number of without prejudice approaches to the Minister in an effort to avoid a contested hearing and identified to the Minister the shortcomings of his case. Those approaches were not accepted, and the Minister has achieved a result that is significantly less favourable than he would have achieved had he accepted the applicant’s offer – there now being no obligation to licence the land, and the parties having incurred extensive legal fees only to achieve the result the applicant always contended would eventuate.
In relation to the Minister’s submission that the offer was not a true compromise because it called for a “total capitulation on the part of the respondent”, NSWALC submitted that the submission misunderstands the nature of the ALRA. The ultimate issue in any Aboriginal land claim appeal is whether the land is “claimable Crown lands”. If it is, an order is made for it to be surveyed and transferred. If it is not, the appeal is dismissed. To make an offer that includes an order that the land be transferred to the applicant, when that is the only order that can follow when land is claimable, does not mean any offer which includes an order to that effect is not a genuine offer, particularly when the offer also provided for an outcome that the Court could not itself order (the licence) and was that there would be no order as to costs. In any event, NSWALC submitted, the value of a freehold parcel with vacant possession is more than a freehold parcel the applicant otherwise would have had an obligation to licence for 5 years. This, along with proposing an order that each party bear their own costs when the applicant’s position was that costs should follow the event, was a significant compromise.
Further, in relation to the observations of Rogers CJ Comm D in Tickell v Trifleska at 355, those observations were submitted to have no application in the context of a claim under the ALRA which is concerned with the applicant’s rights to the claimed land, with the result that a settlement proposal will almost always involve the transfer of that land to the Aboriginal land council. In any event, the applicant’s offer did contain a significant element of compromise in relation to the proposed licence and costs.
Contrary to the Minister’s contention, NSWALC submitted that the offer was provided together with an explanation as to why it was reasonable. All but one of the matters identified in the offer were made out in the primary judgment. [12] The applicant also gave additional reasons justifying the offer in subsequent correspondence annexed to the Turner affidavit. The offer was open for acceptance up until 1 December 2024 which was after the conciliation conference. Moreover, it was not correct for the Minister to say that the applicant’s “factual assertion” that the land was unoccupied was found to be incorrect. The Court held at [137] that the land was “used or occupied” (emphasis added). In any event, this was immaterial in circumstances where the critical question – decided in the applicant’s favour – was whether the land was lawfully used or occupied.
Nor, NSWALC submitted, should the Court accept the Minister’s submission that accepting the offer would in some way have prevented the Minister from carrying out his statutory duties. Offers of compromise are regularly made and accepted by both parties in Aboriginal land claim appeals. As to the Minister’s suggestion that the claim raised complex issues in relation to the Public Works Act 1912 (NSW) and the Court Security Act 2005 (NSW) such that it was reasonable for the Minister not to accept the offer, the Minister was not, at the time of the offer, making any argument concerning the effect of the Public Works Act or the Court Security Act such that any complexities arising from those issues could not have been relevant to the Minister’s acceptance (or rejection) of the offer.
Significance of the Minister’s notice of intention to appeal
Contrary to the Minister’s submission, I do not consider that the appropriate course is to stay any order as to costs pending the outcome of the appeal proceedings. Firstly, as at the date of this judgment, the Minister has not commenced an appeal from my decision in the Leeton Courthouse claim. On 19 June 2026, the Minister filed a notice of intention to appeal pursuant to r 51.8 of the UCPR. That preserves an entitlement to appeal notwithstanding the subsequent expiry of the 28 day appeal period that would otherwise apply under r 51.16. It is, however, insufficient to institute an appeal. Secondly, and more significantly, it is settled principle that a primary judge should rule on the costs of the trial, including any application for indemnity costs. As McColl JA (Beazley and Ipp JJA agreeing) said in Dunstan v Rickwood (No 2) [13] at [54]:
[54] Before concluding this judgment I should say that the course the parties agreed of leaving the issue of the costs of the trial for consideration by this Court was inappropriate. As I have said it appears the parties adopted this course without recourse to the primary judge. A primary judge should always rule on the costs of the trial, including any application for indemnity costs. That judge is in the best position to determine the issues relevant to such orders, including the conduct of the trial, the reasonableness of the parties litigating particular issues and the reasonableness of a party’s rejection of offers having regard to the necessity, in determining whether an indemnity costs order should be made, to consider the circumstances at the time the offer was made. This Court is entitled to have the benefit of the primary judge’s view on costs.
I am not satisfied that any reason has been demonstrated for departing from that principle. Accordingly, I will proceed to determine the question of the costs of the Class 3 appeal made by NSWALC pursuant to s 36(7) of the ALRA.
The source of the Court’s power to make a costs order in a Class 3 Aboriginal land rights appeal
The primary question which arises in relation to the question of costs is the source of the Court’s power to order costs in a Class 3 Aboriginal land rights appeal made pursuant to s 36(7) of the ALRA. In its submission in chief, NSWALC relied on r 42.1 (General rule that costs follow the event), Part 20 Div 4 (Compromise) and Part 42 Div 3 (Offers of compromise) of the UCPR. In its submissions the Minister contended that those provisions do not apply to Class 3 Aboriginal land rights appeals by reason of Column 4 in Schedule 1 to the UCPR. In its submissions in reply NSWALC accepted that those provisions are excluded in relation to Class 3 Aboriginal land rights appeals.
A related question concerns the weight to be attached to the decision of Bignold J in Yamba Waters No 2; that is, whether as NSWALC contends the decision provides a comprehensive statement of law on the Court’s discretion on costs in relation to appeals pursuant to s 36(7) of the ALRA, is not in error, and should be applied, or whether as the Minister contends, the decision is distinguishable.
Before turning to consider the Court’s decisions in Narromine, Birrigan Gargle Local Aboriginal Land Council v Minister Administering the Crown Lands Act [14] (Birrigan Gargle No 1), Birrigan Gargle No 2*,* and Yamba Waters No 2, I first consider the statutory provisions which presently bear upon the determination of costs in Class 3 land rights appeals, noting that each of those cases was decided prior to the coming into force of the Courts and Other Legislation Further Amendment Act 2011 on 13 September 2011. As set out above at [30] to [31], prior to the commencement of that amending legislation, an appeal pursuant to s 36(7) of the ALRA came within the jurisdiction conferred by the “catch all’ provision in s 19(h) of the LEC Act, and was subject to r 3.7 of the LEC Rules, including r 3.7(2) which provided that the Court is not to make an order for the payment of costs “unless the Court considers that the making of an order as to the whole or any part of the costs is fair and reasonable in the circumstances”.
However, the effect of the amending legislation was to include appeals under s 36(7) of the ALRA in the list of Class 3 matters referred to in s 19 of the LEC Act: see s 19(g2) of the LEC Act and the Second Reading Speech for the Courts and Other Legislation Further Amendment Bill 2011, 26 August 2011 introduced on motion by the Attorney General and Minister for Justice Greg Smith. [15] It follows that the present Class 3 proceedings fall within the specific jurisdiction conferred on the Court by s 19(g2) of the LEC Act, and not within the jurisdiction conferred by the “catch-all’ provision in s 19(h). It further follows that the present Class 3 proceedings are not “any other appeals, references or other matters referred to in section 19(h) of the Land and Environment Court Act 1979” for the purposes of r 3.7(1)(c) of the LEC Rules and therefore not subject to the special provision for costs in r 3.7, in particular r 3.7(2) which provides that the Court is not to make an order for the payment of costs unless the Court considers that the making of an order as to the whole or any part of the costs is fair and reasonable in the circumstances. So much was common ground.
The source of the Court’s power to make a costs order in these Class 3 civil proceedings, not being proceedings specified in r 3.7(1)(c) of the LEC Rules, is s 98 of the CPA and, in particular, s 98(1) which provides that “(1) Subject to rules of court and to this or any other Act: (a) costs are in the discretion of the court, and (b) the court has full power to determine by whom, to whom and to what extent costs are to be paid, and (c) the court may order that costs are to be awarded on the ordinary basis or on an indemnity basis”. The removal of Class 3 Aboriginal land claim appeals from the ambit of the LEC Rules did not result in the introduction of the general rule in r 42.1 of the UCPR that costs follow the event or the offer of compromise provisions in Part 20 Div 4 (Compromise) and Part 42 Div 3 (Offers of compromise) of the UCPR to the determination of costs in appeals to the Court under s 36(7) of the ALRA. That is because Schedule 1 “Application of rules” to the UCPR expressly excludes from proceedings in Class 1, 2 and 3 of the Court’s jurisdiction, other than proceedings under s 56A of the LEC Act, Part 20, Div 4 and Part 42 Div 3 in relation to all proceedings other than those referred to in s 19(a), (c), (c1), (e), (e2), (e3), (f), (f1) or (g) or 40 of the LEC Act, none of which is presently applicable, as well as rules 42.1, 42.6, 42.8. 42.9, 42.18, 42.19 and 42.20. The result is that the question of costs in Class 3 Aboriginal land rights appeals is to be determined in accordance with s 98 of the CPA and is not subject to the rules of court in r 42.1, Part 20, Div 4 and Part 42 Div 3 of the UCPR.
Having determined that pursuant to s 98 of the CPA, the costs of the Class 3 proceedings here are in the discretion of the Court, I turn to consider the relevance, if any, of the decisions in Narromine, Birrigan Gargle No 1, Birrigan Gargle No 2, and Yamba Waters No 2, each of which was decided prior to the coming into force of the Courts and Other Legislation Further Amendment Act 2011 on 13 September 2011, and the removal of Aboriginal land claim appeals from the catch-all provision in s 19(h) of the LEC Act and hence from the application of r 3.7 of the LEC Rules.
In Narromine, the Minister sought that the applicant, Narromine Local Aboriginal Land Council, pay his costs of a Class 3 land rights appeal in circumstances in which the land council had filed a notice of discontinuance. The Minister submitted that there was no practice of the Court concerning costs in Class 3 and one was therefore led to the discretion inherent in (then) s 69 of the LEC Act and the special provisions for costs in Part 11 of the LEC Rules, in particular r 7, when a matter is discontinued. There was no relevant misconduct on the part of the Minister on which the applicant could rely as a disqualification for costs. The land council likewise submitted that there was no practice of the Court in relation to Class 3 proceedings, and that the land rights jurisdiction arose under the miscellaneous heading in s 19(h) of the LEC Act. The land council relied on the broad discretion in s 69 of the LEC Act and submitted that in all the circumstances the application of Part 11, r 7(1) would be inappropriate. The land council further submitted that the ALRA is beneficial and remedial legislation, and that because a potential inchoate property right is involved, a land council has a duty to its members to proceed carefully before abandoning any such right.
Stein J said at 433 to 434 (emphasis added):
As I mentioned earlier, because there has never been an application for costs of a land rights appeal, there has not been any opportunity for the Court to consider its position, in policy terms, on the appropriateness of costs. That is, of course, leaving to one side the question of conduct of the parties, special or exceptional circumstances. In my view the nature of land rights appeals under the Aboriginal Land Rights Act; the express beneficial and remedial nature evinced by the recitals to the Act; the nature of the rights inherent in s 36 which, according to the Court of Appeal, comprise inchoate property rights, see Hope JA in New South Wales Aboriginal Land Council v Minister (Winbar claim (No 3)) (1988) 14 NSWLR 685 at 696; make it appropriate for the Court to form the opinion that, in the ordinary course of such appeals, no orders for costs ought be made whatever the result**.** That is, whether the result is that the claim be granted in whole or in part or refused. This situation should pertain in the absence of exceptional or special circumstances which may concern the conduct of a party to the litigation.
In Birrigan Gargle No 1*,* Bannon J at 391 held that the general principle that costs should follow the event applies to Aboriginal claims in Class 3 proceedings under the ALRA “just as much as to other litigation to establish a claim to a legal right”. His Honour’s attention was drawn to the judgment of Stein J in Narromine, and his Honour said that while he had reached a different view to that of Stein J, it was inappropriate to make an order for costs in the proceeding before him in circumstances in which he considered there was no jurisdiction to make any order as to costs, consent orders having been minuted and perfected.
Earlier at 390, Bannon J observed as follows:
In previous cases before me, the Minister when successful, has not pressed for his costs against an Aboriginal Land Council. No doubt, bearing in mind the preamble to the Act, and the remedial purpose of the legislation, this has been an appropriate attitude in other cases. There may be an element of `heads I win, tails you lose’ in the applicant’s request for costs against the Minister, but this should not deflect the Court from giving an appropriate response.
The issue raises a matter of principle. Appeals under s 36 of the Act are heard in class 3 of this Court’s jurisdiction. There are several matters which should be noted in relation to costs in this class of proceedings. In the first place, the Court has a wide discretion to award costs, conferred upon it by s 69(2) of the Land and Environment Court Act 1979 (NSW). However, in relation to proceedings in classes 1 and 2 of the Court’s jurisdiction, the Court has promulgated a practice direction (Practice Direction No 3, cl 12) which stipulates that, in those proceedings, no order for costs shall be made unless the circumstances are exceptional. Next, in all other classes of its jurisdiction, the rule, in accordance with established authority, is that costs generally follow the event. Lastly, these proceedings are only the second occasion upon which a claim has been made for costs in class 3 proceedings concerning a claim under the Act. The first case was Narromine Local Aboriginal Land Council v Minister Administering the Crown Lands Act (1993) 79 LGERA 430.
The nature of the proceedings in each case is an appeal from the refusal by, in the one case, a local authority (or the Minister, where the Minister acts as the consent authority) and, in the other case, the Minister. This may be contrasted with proceedings where an applicant endeavours to establish a right, or a breach of a law, or a wrongful act of an authority. Here, and in class 1 and 2 appeals, what is involved is a re-assessment of the basis for the original refusal**.** In these proceedings, this involves a determination of questions of fact; in class 1 and 2 proceedings, this involves principally a determination based on questions of merit. However, the underlying philosophy in each case is the same so far as concerns the costs of the proceedings — the disaffected claimant should not be deterred from that review or re-assessment of the decision by the risk of an award of costs against them**.** It was this policy which led to the promulgation of the practice direction in planning and building appeals and it seems to me that this policy should underpin the award of costs in appeals under the Act.
… I am of the opinion that the proper principle to be applied by this Court, in the exercise of its discretion as to an order for costs in proceedings in class 3 of its jurisdiction in relation to claims under the Act, ought to be that no order should be made as to costs, unless the circumstances are exceptional.
On the facts before her, however, the chief judge (at 142) considered that there were exceptional circumstances justifying an order for costs being made in favour of the land council against the Minister.
In Yamba Waters No 2, the land council, having been successful in its appeal pursuant to s 36(7) of the ALRA, sought an order that the Minister pay its costs of the Class 3 proceedings. Its claim for a costs order was founded on two grounds: firstly, its entire success in the proceedings; and secondly, the Minister’s conduct of the litigation qualifying as “special or exceptional” circumstances. The Minister resisted both foundations, contending that previous decisions of the Court had not favoured the conventional “costs follow the event” approach in Aboriginal land claims brought to the Court pursuant to s 36(7) of the ALRA, and that there were no special or exceptional circumstances in the respondent’s conduct of his case to justify awarding costs against the respondent.
Bignold J at [30] did not think it a legitimate exercise to translate the earlier decisions of the Court in Narromine, Birrigan Gargle No 1 and Birrigan Gargle No 2 into “a general or settled practice or guideline” governing the exercise of the Court’s discretion in respect of appeals pursuant to s 36(7) of the ALRA. The consequence of there being no settled practice or guideline for the exercise of the Court’s costs discretion in relation to appeals pursuant to s 36(7) was that the Court’s costs power, and the basis for its exercise, were to be understood in the manner expounded by the High Court in Oshlack v Richmond City Council [16] (Oshlack). This meant that the Court’s earlier decisions were to be understood as decisions on their own facts, revealing the manner in which the Court’s costs discretion was exercised in those particular cases, but not governing the manner in which the Court should exercise its discretion in the present case. In Yamba Waters No 2 (unlike Narromine where the appeal was discontinued and Birrigan Gargle where the case settled), it was to be recalled that the proceedings before him were fully litigated (including a four day hearing) and the applicant was entirely successful in the result.
Bignold J considered that there was no reason why, in the case before him, the Court should not apply the compensatory principle in exercising its costs discretion by awarding costs in favour of the applicant as the successful party in the litigation (at [39]). The land council, in vindicating its statutory rights, had had to incur legal costs. In those circumstances, the compensatory principle was “inevitably and eminently, the just and appropriate approach or principle to adopt in exercising the Court’s costs discretion” (at [43]).
However, his Honour held, it should not be assumed that “if the Court exercises its costs discretion in favour of a claimant land council which succeeds in its appeal, it will also exercise the same discretion against the claimant where its appeal fails” (at [45]). His Honour’s reason for sounding a caution against making that assumption was founded upon the nature of the respective rights and obligations of the parties to a land claim created by the ALRA, which rights and obligations were “very clearly expounded” in the judgment of Hope JA in New South Wales Aboriginal Land Council v Minister Administering The Crown Lands (Consolidation) Act and The Western Lands Act [17] at 694. At [50] to [51] Bignold J said:
[50] In these special circumstances, (which include the fact that the Legislature has not provided in the Land Rights Act any special provision relating to the costs of proceedings in exercise of the statutory right of appeal) I do not think it can be assumed that if the Minister, on the hearing of an appeal under s 36(7) of the Land Rights Act, satisfies the Court that the lands are not relevantly claimable Crown lands, that the Court would ordinarily exercise its costs power by ordering the unsuccessful claimant land council to pay the Minister’s costs. Not only does that assumption simply assume that the Minister would apply for costs in such circumstances (when for good policy reasons, he may not), but it assumes that the Court, faced with such an assumed application would, in exercising its costs discretion, simply apply the “costs follow the event” approach. In my opinion neither of the assumptions should be taken as foregone conclusions. In particular, the vindication of the second assumption encounters the very strong contrary indication provided by the Land Rights Act delineating the Minister’s twofold obligation to (i) investigate the facts relevant to a land claim; and (ii) to satisfy the Court, on an appeal pursuant to s 36(7), that the conclusion reached by the Minister as a result of that investigation was the correct conclusion on the facts.
[51] Moreover, in respect of the costs incurred in the discharge of the Minister’s obligation to satisfy the Court in any appeal proceedings, it is reasonable to assume that the costs will have already been substantially incurred in the discharge of the Minister’s primary obligation to investigate the facts following the lodgement of a land claim and it is reasonable to assume that the Legislature did not contemplate the recovery of these costs from an Aboriginal Land Council in the event of the Minister’s decision being confirmed by the Court, on appeal. The costs of the Minister’s statutory investigation are obviously costs of administering the Land Rights Act, and it is but a short step to likewise regard the Minister’s costs incurred in an appeal under s 36(7) of the Act.
Bignold J concluded at [54]:
[54] What I have said concerning the obligations and rights created by the Land Rights Act entirely satisfies me that there is no inherent contradictoriness involved in saying that a successful appeal under s36(7) of the Land Rights Act will ordinarily result in an order for costs being made in favour of the land council whereas an unsuccessful appeal will ordinarily not result in an order being made against the land Council.
With respect to their Honours, the decisions in Narromine, Birrigan Gargle (No 1), Birrigan Gargle No 2, and Yamba Waters No 2 are of limited assistance in determining how in the circumstances of these proceedings the Court should exercise the discretion in s 98 of the CPA in relation to costs. I accept that there is some force to the observation of Bignold J in Yamba Waters No 2 that the compensatory measure in s 36 of the ALRA is diminished if a land council is required to incur legal costs to vindicate its statutory rights and is not able to recover those costs. I have greater difficulty with his Honour’s suggestion that an appeal under s36(7) will ordinarily result in an order for costs being made in favour of the land council whereas an unsuccessful appeal will ordinarily not result in an order being made against the land Council. [18] Such an asymmetric approach to costs seems to sit somewhat awkwardly with the proposition that a successful party should not be deprived of its costs unless there is material to justify a contrary order being made: Milne v Attorney-General for the State of Tasmania at 477. I likewise accept that there is considerable force to the approach of Stein J in Narromine that in the ordinary course of land rights appeals, no orders for costs ought be made whatever the result absent exceptional or special circumstances which may concern the conduct of a party to the litigation. As Pearlman CJ of LEC said in Birrigan Gargle No 2, the underlying philosophy is that the disaffected claimant should not be deterred from the review or re-assessment of the decision by the Minister to refuse an Aboriginal land rights claim by the risk of an award of costs against them. It is also an approach which avoids the asymmetry inherent in that favoured by Bignold J in Yamba Waters No 2.
Ultimately, however, I consider that s 98 of the CPA is to be construed as s 69 of the LEC Act [19] was construed in Oshlack. There, Gaudron and Gummow JJ said at [21] to [22] (footnotes omitted):
The construction of s 69 of the Court Act
[21] The provisions of s 69 of the Court Act which confer upon the Court the discretion exercised by the primary judge attract the application of the general proposition that it is inappropriate to read a provision conferring jurisdiction or granting powers to a court by making conditions or imposing limitations which are not found in the words used. The necessity for the exercise of the jurisdiction or power by a court favours a liberal construction. Considerations which might limit the construction of such a grant to some different body do not apply.
[22] The terms of s 69(2) contain no positive indication of the considerations upon which the Court is to determine by whom and to what extent costs are to be paid. The power conferred by the section is to be exercised judicially, that is to say not arbitrarily, capriciously or so as to frustrate the legislative intent. However, subject to such considerations, the discretion conferred is, to adapt the words of Dixon J, unconfined except in so far as “the subject matter and the scope and purpose” of the legislation may enable an appellate court to pronounce the reasons given by the primary judge to be “definitely extraneous to any objects the legislature could have had in view”.
In exercising the discretion in s 98 of the CPA, I have determined that the Minister should pay the applicant’s costs on the ordinary basis. The applicant, NSWALC, has been successful in its appeal, and in vindicating its statutory rights has incurred costs. It is fair and just that the applicant be compensated for the costs it has incurred.
However, I do not consider there to have been any relevant conduct on the part of the Minister in defending the Class 3 proceedings, or other special or exceptional circumstances warranting the award of costs on an indemnity basis. Whilst the correspondence annexed to the Turner affidavit, including the offer of a license and to discontinue the proceedings with no order as to costs, evinces a desire on the part of the applicant that the proceedings not continue to be a contested hearing, I accept, as submitted by the Minister, that the correspondence does not sufficiently articulate the reasons why refusal by the respondent would be unreasonable, and that the offer raised complex questions of law in relation to the application of the High Court’s decision in Berrima Gaol, and the meaning of “court premises” in the Court Security Act. Having considered the correspondence between the parties concerning 28 August 2024, I am not satisfied that it was unreasonable of the Minister to reject the applicant’s offer of compromise.
For the foregoing reasons, the Court makes the following order:
Pursuant to s 98 of the Civil Procedure Act 2005 (NSW), Minister Administering the Crown Land Management Act to pay the applicant’s costs of the proceedings on the ordinary basis.
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[2026] NSWLEC 69.
[1999] NSWLEC 123.
(1990) 25 NSWLR 353.
[2025] NSWLEC 69.
Hansard 26 August 2011 page 25.
The applicant’s written submissions referred to r 45.1 of the UCPR. I have taken this to have intended to be a reference to r 42.1.
(1993) 79 LGERA 430.
(1993) 81 LGERA 137.
(2003) 54 ATR 323; [2003] NSWSC 1003.
New South Wales Aboriginal Land Council v Minister Administering the Crown Lands Act (2016) 260 CLR 232; [2016] HCA 50.
(1956) 95 CLR 460.
The offer stated that “The parties both acknowledge that the land was the subject of R751742 for Future Public Requirements. This is consistent with the land being Crown land and vested in His Majesty”. The Minister’s further amended SOFAC withdrew this acknowledgement and there was no finding in the primary judgement about whether or not the land was reserved as it “was not necessary to determine” (at [196]).
[2007] NSWCA 266; cited with approval in Electoral Commissioner of the Australian Electoral Commission v Laming (No 3) [2023] FCA 1385 at [4] (Rangiah J).
(1993) 80 LGERA 389.
Hansard 26 August 2011 page 25.
(1998) 193 CLR 72; [1998] HCA 11.
(1988) 14 NSWLR 685.
In Darkinjung Local Aboriginal Land Council v Minister Administering the Crown Lands Act and Anor (No 2) [2007] NSWLEC 523, Pain J (at [6]) also appears to have proceeded on the basis that the usual rule was that costs follow the event in awarding costs in favour of the successful land council, but in doing so did not refer to Birrigan Gargle No 1 or Birrigan Gargle No 2.
Section 69(2) of the LEC Act provided: “Subject to the rules and subject to any other Act: (a) costs are in the discretion of the Court; (b) the Court may determine by whom and to what extent costs are to be paid; and (c) the Court may order costs to be taxed or otherwise ascertained on a party and party basis or on any other basis.” Section 69(2) was in relevantly similar terms to what is now s 98(1) of the CPA, and was substantially the same as that contained in s 76(1)(a) and (b) of the Supreme Court Act 1970 (NSW). Both provisions can be traced back to Order 55 of the Rules of Court contained in the Supreme Court of Judicature Act 1875 (UK): see Oshlack at 95 to 96 (McHugh J); Birrigan Gargle (No 2) at [6].
New South Wales Aboriginal Land Council
Minister Administering the Crown Land Management Act (“Leeton Courthouse claim”) (No 2)
[2026] NSWLEC 69
(1993) 81 LGERA 137
(1993) 80 LGERA 389
(1998) 193 CLR 72
(1956) 95 CLR 460
(1993) 79 LGERA 430
(1988) 14 NSWLR 685
(2016) 260 CLR 232
(1990) 25 NSWLR 353