Newton Denny Chapelle v Ballina Shire Council

EX TEMPORE Judgment 1This matter comes before me today as Duty Judge in order to determine a question of costs. While matters raised on that question may, in the present case, be seen to give rise to issues of some importance, given what, on any view, is the relatively small sum in contention, I have thought it appropriate to dispose of the matter expeditiously and immediately, rather than reserve my decision for a more detailed judgment. While more elaborate reasons than those I am about to express could be given, in the interests of time and prompt finality, I consider it appropriate to deliver judgment now with sufficient reasons to explain the conclusion that I have reached. 2Newton Denny Chapelle, the Applicant, commenced an appeal in this Court pursuant to s 97AA of the Environmental Planning and Assessment Act 1979 (NSW) (the EPA Act). The appeal proceedings commenced after Ballina Shire Council (the Council) had refused an application under s 96 of the EPA Act to modify a development consent granted to the Applicant on or about 26 May 2011. Although the Council first notified its refusal of that modification application on 2 September 2013, that decision was confirmed on 5 November of that same year, following the determination of an application for review made by the Applicant under s 96AB of the EPA Act. 3The appeal was heard by Commissioner Morris on 6 June last. In a reserved judgment, the Commissioner dismissed the appeal on 26 June (Newton Denny Chapelle v Ballina Shire Council [2014] NSWLEC 1123). Nonetheless, the Applicant now applies by motion for an order that its costs be paid by the Council in respect of three interlocutory step in the proceedings. 4First, it seeks its costs for the first call-over before the Registrar on 16 December 2013 when it was represented by its solicitor but the Council failed to appear. The Council accepts that it is liable for those costs. 5Second, the Applicant seeks its costs associated with a Notice of Motion that it filed on 6 February 2014, seeking to have a separate issue heard and determined before a hearing on the merits of the application. Although a separate question was ordered to be heard and determined, the hearing of that question did not proceed as the Council subsequently amended its Statement of Contentions, thereby removing the contentions that gave rise to that separate question. 6Third, the Applicant seeks the costs of the Council's Notice of Motion dated 14 March 2014 for leave to amend its Statement of Contentions. 7The proceedings having been commenced in Class 1 of the Court's jurisdiction, the making of an order for costs in such proceedings is governed by Pt 3, r 3.7 of the Land and Environment Court Rules 2007 (NSW). Subrule (2) of that rule proscribes the making of 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." Subrule (3) of that same rule identifies circumstances in which the Court might consider the making of an order to be fair and reasonable, although those circumstances are not exhaustive of the circumstances in which the discretion may be exercised. 8As expressed in subrule (3), those circumstances include: "(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, ... (d) that a party has acted unreasonably in the conduct of the proceedings, ... " 9The development consent granted to the Applicant on 26 May 2011 related to land described as being Lot 20 in DP 1051208 known as 1188 Teven Road, Alstonville. The development for which consent was granted was the establishment of a bulk store for a scaffold business involving the construction of a shed and vehicular access for the bulk storage of trucks and scaffold equipment. That consent was subsequently implemented and the development undertaken. 10The modification that was sought and which was the subject of appeal in the proceedings was for the provision of an external holding yard, involving the amendment of the hard stand area beyond that originally approved, together with the provision of a new driveway from Teven Road. As I have said, that application was refused by the Council and the present appeal instituted on 22 November 2013. 11By its Notice of Contentions, first filed after the first return date of the application, the Council in substance contended: (1)that the area of land to which the modification application related did not have the benefit of the consent and was therefore prohibited (Contention 1); and (2)that the existing approved use was prohibited and the application sought to intensify that use involved an "increase in the size of the bulk store approved use by more than three times" (Contention 2). 12In short, the contentions seemed to assert that the existing use provisions of the EPA Act and the Regulation made under that Act were relevant and that the ambit of the original development consent did not extend beyond the four walls of the building identified in that consent. 13The manner in which the two contentions in question were framed appear to have arisen from the circumstance that between the date of the development consent in May 2011 and the date of the application to modify the consent, the relevant planning instrument had been replaced. The old planning instrument upon which the May 2011 consent was founded had been repealed and a new planning instrument commenced, whereby the use of the land that was the subject of that consent was now prohibited, at least if it be categorised as a bulk store. I interpolate that the contentions that are the subject of the present controversy were not reflected in the single ground upon which the Council had notified its refusal of the modification application. While the Council was entitled to raise new grounds once the appeal was instituted, the fact that the Council did so is, in the present circumstances, relevant to the determination of costs. 14As a result of filing its Notice of Contentions that included the two contentions that I have identified, the Applicant filed its Notice of Motion seeking to have issues, thought to be raised by them, determined as a separate and preliminary matter before any merit issue was considered. That notice of motion was determined by Sheahan J on 13 February 2014. His Honour accepted that there was a question directed to "existing use" appropriate to be determined as a preliminary matter pursuant to Pt 28, r 28.2 of the Uniform Civil Procedure Rules 2005 (NSW). His Honour also recorded that the precise question or questions to be determined should be amended in a manner to be agreed between the parties, it being recorded that the application for separate or preliminary determination was a course with which the Council agreed. 15However, subsequent to his Honour's order, the solicitor for the Council wrote to the solicitor for the Applicant, indicating that after either conferring with or obtaining the advice of counsel and having given the matter further consideration, the need for determination of the separate question could be avoided if the contentions giving rise to that question were deleted. In that letter, the Council's solicitor observed that the two contentions in question were not necessary to be determined in the appeal, given that the appeal involved an application to modify a consent rather than one seeking the grant of development consent. 16Understandably, that position was accepted as being appropriate by the Applicant. As a consequence, the Council by Motion dated 14 March 2014 sought leave to amend its Statement of Facts and Contentions, a course in which the Applicant agreed. That amendment removed contentions 1 and 2 as they had originally been framed. Costs of the latter Motion were reserved. 17The Council contends that an order requiring it to pay the costs sought by the Applicant would not be fair and reasonable in the circumstances. It submits that insertion of the two contentions in question and the subsequent agreement to the framing of a question or questions for separate determination was the consequence of mutual mistake by the parties. 18To identify the source of that mistake, the Council points to the terms of the Applicant's review application under s 96AB of the EPA Act. In that application, taking the form of a letter to the Council, the Applicant first referred to the report prepared by Council staff for the meeting of the Council held on 27 June 2013 when the modification application was first considered. In recommending that the Council approve the application, the staff report stated that the modification sought was permissible "pursuant to existing use rights". In its modification application made under s 96(1A), the Applicant had not sought to rely upon, or even identify "existing use rights" as a basis upon which to found support for its application. However, as the topic had been raised in the Council staff report, when advancing its application for review under s 96AB, the Applicant sought to support its application by contending that it did have "existing use rights", as a consequence of which there was no legal impediment to the grant of approval that it sought. 19It is accepted, as it was upon the hearing of the appeal, that "existing use rights" were unnecessary to be debated or even raised as a basis upon which to contend that the modifications sought could not be granted. The fact that the use for which development consent had been granted in May 2011 was now a prohibited use did not constitute a legal impediment to the modification that was sought either by reference to use or to intensify that use by extending its activities onto other parts of the land to which the May 2011 consent related (Scrap Realty Pty Limited v Botany Bay City Council [2008] NSWLEC 333). 20These circumstances, so it is submitted, identify the source of the common mistake giving rise to the framing of the original contentions 1 and 2. In its review application, the Applicant had made a minor amendment to the application originally lodged with the Council, involving the removal of the access from Teven Road in the location originally proposed. As that was the application being considered upon review, the Council contends that the Applicant had raised existing use rights in support of the application which then caused the Council to frame contentions 1 and 2 in the manner that it did, in effect identifying that there was an issue with the claimed reliance upon existing use rights. The Council's contentions were apparently framed by an officer of the Council. 21I do not accept the "common mistake" justification advanced by the Council for submitting that it is not fair and reasonable for it to be ordered to pay the costs that the Applicant seeks. First, it is not the Applicant, but rather the Council, that is first required to identify the issue or issues that arise in Class 1 proceedings following refusal of an application. In my opinion, it would be wholly inappropriate for a consent authority to frame a contention or contentions seeking to take issue with an argument contained in a document supporting an application under s 96 or s 96AB when the contention or contentions so framed are irrelevant to the determination sought to be advanced by the consent authority, namely that the application should be refused. 22Second, I am strongly of the view that the preparation of a Statement of Contentions, so far as it raises questions of law or mixed fact and law, ought not be allowed to bypass the legal representative of the party preparing that Statement without independent scrutiny by that legal representative. After all, the legal representative is filing a document in proceedings that, it must be assumed, identifies the real and substantive issues to be determined in the proceedings. The fact that a town planner who was not legally qualified may have framed contentions, raising an issue of mixed fact and law, seems to me to necessitate assessment by those legal representatives before the document is filed. In this case, the position that was ultimately taken by deleting the original contentions 1 and 2, apparently without too much persuasion on the part of the Council's solicitor, was one that ought to have been considered and taken before the document was filed and served in the proceedings. 23I have formed the view that it is fair and reasonable that the Applicant have an order in its favour for payment of costs associated with the two notices of motion. The Applicant, who was the beneficiary of a consent, could not be expected to treat lightly an assertion that its capacity to conduct activities on its land, including activities that could lawfully be the subject of a modification application, were as constrained as the contentions originally filed sought to assert. 24Furthermore, it seems to me that even if the issue identified in the Statement of Contentions could not be seen to have been determinative of the entire proceedings, that is not a matter that counts against the Applicant. After all, it must be remembered that in this case the Council, through its solicitor, was complicit in, if not encouraging of, the determination of the separate issue. Apparently, there was an appearance by or on behalf of the Council at the hearing before Sheahan J when the separate question was ordered. At that time, at least, it appeared there would be cooperation in having the terms of the separate question settled between the parties. 25It must also be borne in mind that in order to justify the ordering of a separate question, it is not essential that it be one that is seen to be dispositive of the entire proceedings. If the question has the capacity significantly to narrow issues and save time, then it is also appropriate, in a given case, for such a separate question to be ordered (Allandale Blue Metal Pty Ltd v Roads and Maritime Services [2013] NSWCA 103 at [144]). 26Regrettably, the final form of the Motion for orders which the Applicant currently seeks, was a Notice of Motion filed in Court today. That Notice of Motion seeks not to have an order in general terms for the payment of costs, but rather seeks that the Court make a lump sum order. The power for the Court so to do is to be found in s 98(4)(c) of the Civil Procedure Act 2005 (NSW). 27Although in the affidavit supporting the present Motion, as originally filed, reference was made in one paragraph to the costs that the Applicant's solicitor considered to be appropriate, more recently, the Applicant has filed an affidavit sworn by an expert costs assessor who deposes to the fact that those costs are reasonable. The late filing of the latter affidavit is unfortunate because time has not allowed the Council to respond in an appropriate way to the lump sum application. While the Council has filed an affidavit, prepared by an expert costs assessor, in response, that assessor says that in the time available, she cannot express any opinion as to whether those costs are reasonable. She further says that she is not able to express a positive opinion, based on the material which she has, that the costs are reasonable and, in so saying, gives examples of "standard" costs for particular items of work that are less than those claimed by the Applicant's solicitor. 28In those circumstances, having regard to the principles that attend the making of an order of the kind that is sought (Young v Hones (No 3) [2014] NSWSC 499 at [27]-[30]) regrettably, I am unable to make a lump sum order at the present time as I am not comfortably satisfied that I can properly and fairly assess the appropriate quantum of those costs. While there seems to be agreement as to the quantum of costs payable for the appearance before the Registrar on the first return date of the application, the real issue between the parties as to quantum goes to those costs said to be incurred relative to the motion for separate determination and the motion subsequently filed by the Council to amend the Statement of Contentions. For these reasons I can do no more than make an order in general terms. 29Accordingly, the orders that I make are as follows: (1)The Council must pay (i)the costs of the Applicant reserved at the first call-over of the proceedings on 16 December 2013; (ii)the Applicant's costs associated with the Applicant's Notice of Motion dated and filed 6 February 2014; and (iii)The Applicant's costs reserved on the return of the Respondent's Motion dated 14 March 2014 and returned before the Registrar on 24 March 2014.