Oberon Shire Council v Kiangatha Holdings Pty Ltd

The WaterNSW Notice of Preventative Action proceedings

1. It is sufficient, for present purposes, to note that these Class 1 proceedings were settled by consent orders made by Robson J on 6 June 2019. The outcomes of those proceedings are set out in the Court's records as being: (1) The appeal is upheld. (2) The Notice of Preventative Action dated 7 December 2017 ('Notice') is varied to require the Applicant, in accordance with item 14 of the Notice, to implement the Soil and Water Management and Remediation Plan ('the Plan') prepared by Landloch dated 24 May 2019 being Annexure "A" to Consent Orders signed by the parties and filed in Court. The Court notes the agreement between the parties that: (a) Directions 1 to 13 of the Notice have been varied from time to time during the course of these proceedings by agreement between the parties and the Court has made Orders, by consent of the parties, which have had the effect of varying the terms of the Notice. (b) Directions 14 to 18 of the Notice will be satisfied by the implementation of the Soil and Water Management and Remediation Plan prepared by Landloch dated 24 May 2019.
2. For the purposes of these proceedings, it is sufficient to note the existence of the Soil and Water Management and Remediation Plan prepared by Landloch dated 24 May 2019 being incorporated into the above orders - it is not necessary to reproduce that plan (or, indeed, any detail from it).

The WaterNSW prosecutions

1. WaterNSW laid a number of charges against the Company for breaches of s 120(1) of the Protection of the Environment Operations Act 1997. When those matters first came before Robson J, it was argued that the charges were duplicitous. It is unnecessary to canvass the detail of the matters argued; it is sufficient to note that, on 6 December 2019, his Honour held that the charges were not defective (WaterNSW v Kiangatha Holdings Pty Limited; WaterNSW v Laurence Natale [2019] NSWLEC 185). The Company appealed this decision to the Court of Criminal Appeal. On 19 October 2020, the appeal was upheld (Kiangatha Holdings Pty Ltd v WaterNSW [2020] NSWCCA 263). Orders 3 and 4 of the orders given on appeal were in the following terms: 3 Order numbered (1) in each of proceedings 2018/295909, 2018/295910, 2018/295911 and 2018/295912 made by the Land and Environment Court on 20 December 2019 is set aside. 4 In lieu thereof it is ordered that further proceedings on each summons are stayed until the respondent elects and particularises in relation to each summons a single offence contrary to s 120 of the Protection of the Environment Operations Act 1997 upon which the respondent will proceed.
2. Further progression of these criminal proceedings have been set down before the List Judge in this Court shortly after the date of this decision.
3. Although the existence of these charges provides contextual background to the litigation involving the Company arising out of its construction of the road on the Company's property, it is not necessary to address those charges further.

The Company's Class 1 development application proceedings

1. On 21 March 2019, the Company lodged a development application with the Council seeking consent for "the use of certain existing tracks for road purposes". On 11 July 2019, the Company commenced a Class 1 appeal against the deemed refusal of this development application by the Council.
2. The Company's development application was responsive to the position adopted by the Council that the roadworks, and the WaterNSW remediation works, required development consent pursuant to the Environmental Planning and Assessment Act 1979 (the EPA Act).
3. As is customary in Class 1 merit appeals, those proceedings were subject to a conciliation process pursuant to s 34 of the Land and Environment Court Act 1979 (the Court Act). The conciliation process was conducted by Dixon SC between December 2019 and August 2020, with agreement being reached between the Company and the Council as to the conditions upon which it would be appropriate for consent to be granted to the Company's development application.
4. The Senior Commissioner, being satisfied that the orders necessary to give effect to the agreement between the Company and the Council were ones able to be made by the Court (this is a necessary jurisdictional satisfaction the Senior Commissioner was required to have pursuant to s 34 (3) of the Court Act), gave effect to the agreement and granted development consent subject to conditions. On 21 August 2020, the Senior Commissioner made the orders and imposed those conditions, the conditions comprising Annexure A to her decision making the orders granting development consent (Kiangatha Holdings Pty Ltd v Oberon Council [2020] NSWLEC 1386).
5. Order 3 of the orders made by the Senior Commissioner is in the following terms: 3 Development Application no.DA10.2019.15.1 for the use of existing tracks as roads for maintenance, extensive agriculture and grazing purposes only on Lot 26 DP 757035, Lot 9 DP 821872, Lot 1 DP 114711, Lot 113 DP 48712, Lots 302 & 303 DP 1230926, Lot 30 DP 757035, Lot 100 DP 757035, Lot 24 DP 757035, Lot 20 DP 757035, Lots 10 & 11 DP 821873 582 Glen Chee Road, GANBENANG NSW 2790 identified in Sheets 1 to 8 in the Open Track Operational Environmental Management Plan and associated stabilisation and rehabilitation works is approved subject to the conditions of consent in Annexure "A".
6. The outcome of the successful conciliation process, as can be seen from the above order made by the Senior Commissioner, did not merely address the Company's desire to be given development consent for the use of certain existing tracks for road purposes but also imposed a positive obligation on the Company to carry out specified remediation works on the property.
7. It is therefore not in dispute that these conditions required the Company to carry out certain remediation works, nor is it in dispute that these remediation works are those arising from "the Open Track Operational Environmental Management Plan and associated stabilisation and rehabilitation works" (this plan being a document noted in the Senior Commissioner's Order 1 and being dated 6 May 2020), rather than the earlier noted obligation imposed on the Company to implement the Soil and Water Management and Remediation Plan prepared by Landloch dated 24 May 2019 dealt with in the orders made by Robson J in June 2019.
8. It is not necessary to examine the detail of the plan incorporated in the Senior Commissioner's orders. It is sufficient, for present purposes, to note that this plan is not the same as the earlier plan incorporated in the orders made by Robson J on 6 June 2019 in the Company's Class 1 appeal against the WaterNSW notice.
9. It is to be observed that the conditions in Annexure A to the Senior Commissioner's decision did not contain any timeframe or setting of a date by which the remediation works referred to in the conditions of consent were required to be completed.

Introduction

1. Class 4 civil enforcement proceedings were brought by the Council pursuant to s 9.45 of the EPA Act. The Council sought to invoke this Court's power to remedy or restrain breaches of the Act arising from the Company's failure to obtain development consent for the construction of its road. It is unnecessary to set out the relevant statutory provision imposing the requirement to obtain such consent. Arising for determination here is, principally, the confined question of whether the Company should be ordered to pay the legal costs of the Council for these Class 4 proceedings given that the successful outcome of the conciliation process before the Senior Commissioner functionally addressed the Council's concerns relating to the road. The consequence of this is, as later discussed more fully, that the parties have agreed that these Class 4 proceedings should be discontinued.

The original Summons

1. The Council filed its Summons on 29 March 2018. The prayers for relief in that Summons were in the following terms: RELIEF CLAIMED 1 A declaration that the road on Lot 26 DP 757035, Lot 9 DP 821872, Lot 1 DP 114711, Lot 113 DP 48712, Lots 302 & 303 DP 1230926, Lot 30 DP 757035, Lot 100 DP 757035, Lot 24 DP 757035, Lot 20 DP 757035, Lots 10 & 11 DP 821873 known as 582 Glen Chee Road, GANBENANG NSW 2790 ("the premises") depicted on Plan A attached ("the road") was constructed in breach of the Environmental Planning and Assessment Act. 2 An order that the Respondent is not to use or permit the road to be used as a road without that Development Consent having been obtained under the EPA Act beforehand. 3 An order that the Respondent is to remediate the surface and surrounds of the road by planting grass and trees to restore natural conditions as they were prior to the construction of the road and consistent with localised vegetation. 4 An order that notwithstanding Order 3 in locations where remediation to prior natural conditions cannot be achieved the Respondent shall:- (a) Restore the road surface by planting grass and trees consistent with localised vegetation and maintain the plantings to maturity; and (b) Batter and drain all surrounding disturbed surfaces to prevent erosion and other sedimentary runoffs. 5 An order that notwithstanding order 2 the Respondent shall be permitted to use the road for the purpose of undertaking remediation required by orders 3 and 4.

The original Points of Claim

1. On 30 January 2019, the Council filed its Points of Claim in support of this commencing Summons. These Points of Claim were in the following terms: PLEADINGS AND PARTICULARS 1 The Applicant is and was at all material times the Council for the Local Government Area (LGA) of Oberon and a body politic pursuant to section 220 of the Local Government Act 1993 with the legal capacity and powers of an individual. 2 The Respondent is and was at all material times the registered proprietor of land comprising Lot 113 in Deposited Plan 48712, Lot 1 in Deposited Plan 114711, Lots 20, 24, 26, 30 and 100 in Deposited Plan 757035, Lot 9 in Deposited Plan 821872, Lots 10 and 11 in Deposited Plan 821873, Lots 302 and 303 in Deposited Plan 1230926, known as 582 Glen Chee Road, Ganbenang NSW 2790 (the Respondent's Land). 3 The Respondent's Land is located within the Oberon LGA. 4 In and between May 2017 and October 2017 the Respondent by its servants, agents or contractors caused works to be undertaken on the Respondent's Land ('the Works'). Particulars of the Works a. Cleared length of approximately 10 kilometres, in the location marked on the aerial photograph annexed and marked "A". b. Variable width not less than 4 metres. c. Maximum width of 10 metres. d. Cuttings of between one to 2 metres in depth. e. Bare compacted and graded dirt surface. 5 The Respondent's Land is zoned RU1 Primary Production under the Oberon Local Environmental Plan 2013 (the LEP). 6 The following terms are defined in the LEP: a. 'Road'; and b. 'Extensive agriculture'. 7 The Works are 'development' as defined in section 1.5 Environmental Planning and Assessment Act 1979 (EPA Act). 8 The Works comprise development that requires development consent. Particulars a. The Works are not characterised as any of the uses stated to be development that is permissible without consent, including extensive agriculture. b. The Works are capable of characterisation as 'Roads' which is development that is permissible with development consent on the Respondent's Land. 9 Development consent for the Works has neither been applied for nor obtained from Council. 10 In the alternative, the Respondent has undertaken the Works which are prohibited on the Respondent's Land in breach of section 4.2(1)(b) of the EPA Act. 11 The construction of the Works has caused damage. Particulars of Damage a. Destruction of trees plants and grasses. b. Scarring of the landscape. c. Exposure of fragile soils. d. Erosion. e. Harm to Endangered Ecological Communities (EECs). f. Harm to White Box - Yellow Box - Blakely's Red Gum Woodland EEC. g. Erosion and sedimentation in steep terrain. 12 The construction of the Works threatens Endangered Ecological Communities. Particulars of threat to EECs a. Erosion of White Box - Yellow Box - Blakely's Red Gum Woodland EEC. b. Erosion of Montane Peatlands and Swamps EEC. c. Erosion of Mountain Hollow Grassy Fen [Montane Bogs and Fens]. 13 The construction of the Works poses a continuing threat of ongoing environmental harm. Particulars of the threat of ongoing environmental harm a. Destruction of trees plants and grasses. b. Scarring of the landscape. c. Exposure of fragile soils. d. Erosion. e. Harm to Endangered Ecological Communities (EECs). f. Harm to White Box - Yellow Box - Blakely's Red Gum Woodland EEC. g. Erosion and sedimentation in steep terrain. 14 The Respondent, or its servants or agents or contractors, has undertaken the Works without first obtaining development consent in breach of section 4.2(1)(a) of the EPA Act. 15 The Applicant seeks the relief set out in the Summons. "A"

Introduction

1. On 3 September 2020, the Council filed an as yet undetermined Notice of Motion seeking the following orders: ORDERS SOUGHT 1 That the Applicant be granted leave to amend its Summons in the form of the Amended Summons annexed and marked "A". 2 That the Applicant be granted leave to amend its Points of Claim in the form of the Points of Claim annexed marked "B".

The proposed Amended Summons

1. The proposed Amended Summons contained prayers for relief replacing what had been sought in the original Summons with a revised declaration and a single order. The relief sought in this proposed Amended Summons is in the following terms: RELIEF CLAIMED 1. A declaration that the works on Lot 26 DP 757035, Lot 9 DP 821872, Lot 1 DP 114711, Lot 113 DP 48712, Lots 302 & 303 DP 1230926, Lot 30 DP 757035, Lot 100 DP 757035, Lot 24 DP 757035, Lot 20 DP 757035, Lots 10 & 11 DP 821873 known as 582 Glen Chee Road, Ganbenang NSW 2790 ("the Premises") and described as: a. cleared length of approximately 10 kilometres, in the location marked on the aerial photograph annexed and marked "A"; b. variable width not less than 4 metres; c. maximum width of 10 metres; d. cuttings of between one to 2 metres in depth; e. bare graded dirt surface: and f. bare compacted and graded dirt surface ("the Works") were constructed in breach of the Environmental Planning and Assessment Act. 2. An order that by 4 December 2020 the Respondent is to complete the works authorised by development consent DA-10.2019.15.1 issued by the Land and Environment Court NSW on 21 August 2020 pursuant to orders made by Commissioner Dixon in Kiangatha Holdings Py Ltd v Oberon Council [2020] NSLWEC 1386.
2. The above single order sought in the proposed Amended Summons would have, if made, the effect of imposing on the Company a mandated completion date for the remediation works which had been agreed to by the parties and embodied in orders made by the Senior Commissioner in the Company's Class 1 development application proceedings.

The proposed Amended Points of Claim

1. The Council's 3 September 2020 Notice of Motion, in addition to annexing the proposed Amended Summons, also annexed proposed Amended Points of Claim. This document, Annexure B to the Notice of Motion, was in the following terms: "B" AMENDED POINTS OF CLAIM (Leave granted September 2020) PLEADINGS AND PARTICULARS 1 The Applicant is and was at all material times the Council for the Local Government Area (LGA) of Oberon and a body politic pursuant to section 220 of the Local Government Act 1993 with the legal capacity and powers of an individual. 2 The Respondent is and was at all material times the registered proprietor of land comprising Lot 113 in Deposited Plan 48712, Lot 1 in Deposited Plan 114711, Lots 20, 24, 26, 30 and 100 in Deposited Plan 757035, Lot 9 in Deposited Plan 821872, Lots 10 and 11 in Deposited Plan 821873, Lots 302 and 303 in Deposited Plan 1230926, known as 582 Glen Chee Road, Ganbenang NSW 2790 (the Respondent's Land). 3 The Respondent's Land is located within the Oberon LGA. 4 In and between May 2017 and October 2017 the Respondent by its servants, agents or contractors caused works to be undertaken on the Respondent's Land ('the Works'). Particulars of the Works a. Cleared length of approximately 10 kilometres, in the location marked on the aerial photograph annexed and marked "A". b. Variable width not less than 4 metres. c. Maximum width of 10 metres. d. Cuttings of between one to 2 metres in depth. e. Bare compacted and graded dirt surface. 5 The Respondent's Land is zoned RU1 Primary Production under the Oberon Local Environmental Plan 2013 (the LEP). 6 The following terms are defined in the LEP: a. 'Road'; and b. 'Extensive agriculture'. 7 The Works are 'development' as defined in section 1.5 Environmental Planning and Assessment Act 1979 (EPA Act). 8 The Works comprise development that requires development consent. Particulars a. The Works are not characterised as any of the uses stated to be development that is permissible without consent, including extensive agriculture. b. The Works are capable of characterisation as 'Roads' which is development that is permissible with development consent on the Respondent's Land. 9 Development consent for the Works had neither been applied for nor obtained from Council at the relevant time. 10 In the alternative, the Respondent has undertaken the Works which are prohibited on the Respondent's Land in breach of section 4.2(1)(b) of the EPA Act. 11 The construction of the Works has caused damage. Particulars of Damage a. Destruction of trees plants and grasses. b. Scarring of the landscape. c. Exposure of fragile soils. d. Erosion. e. Harm to Endangered Ecological Communities (EECs). f. Harm to White Box - Yellow Box - Blakely's Red Gum Woodland EEC. g. Erosion and sedimentation in steep terrain. 12 The construction of the Works threatens Endangered Ecological Communities. Particulars of threat to EECs a. Erosion of White Box - Yellow Box - Blakely's Red Gum Woodland EEC. b. Erosion of Montane Peatlands and Swamps EEC. c. Erosion of Mountain Hollow Grassy Fen [Montane Bogs and Fens]. 13 The construction of the Works poses a continuing threat of ongoing environmental harm. Particulars of the threat of ongoing environmental harm a. Destruction of trees plants and grasses. b. Scarring of the landscape. c. Exposure of fragile soils. d. Erosion. e. Harm to Endangered Ecological Communities (EECs). f. Harm to White Box - Yellow Box - Blakely's Red Gum Woodland EEC. g. Erosion and sedimentation in steep terrain. 14 The Respondent, or its servants or agents or contractors, undertook the Works without first obtaining development consent in breach of section 4.2(1)(a) of the EPA Act. 15 The Respondent made an application for development consent for the use of part of the Works and rehabilitation works to Oberon Council on 21 March 2019. Particulars a. Development application no. DA-10.2019.15.1 was lodged with the Applicant Council on 21 March 2019 ('the DA'). 16 The Respondent filed a class 1 appeal with this Court against the Applicant Council's deemed refusal of the DA on 12 June 2019 ('the Class 1 Proceedings'). 17 The Class 1 Proceedings were resolved by an agreement pursuant to s34 of the Land and Environment Court Act 1979 and the entering of orders by this Court on 21 August 2020 approving the DA subject to conditions ("the development consent"). 18 The conditions of the development consent mitigate the impacts referred to in paragraphs 11, 12 and 13 of these points of claim. Particulars Paragraph 11 Damage-Conditions 1, 3-4, 7-11, 13, 17, 19, 21-22, 34 Paragraph 12 EECs -Conditions 1-5, 7-13, 17, 21-22, 34 Paragraph 13 Ongoing environmental harm - Conditions 1-5, 7-13, 17, 19-22, 26, 29, 32-34, 36, 38, 40 19 The Applicant seeks the relief set out in the Amended Summons.
2. The aerial photograph noted in paragraph 4(a) of these proposed Amended Points of Claim is that earlier reproduced at the end of the original Points of Claim.

Representation

1. The Council was represented by Mr I Hemmings SC and Ms J Reid, barrister. The Company was represented by Ms S Vatala, solicitor.

The hearing

1. The hearing was held, as a consequence of the COVID‑19 pandemic, using Microsoft Teams software, without the necessity for any physical attendance in the courtroom. The hearing was conducted in accordance with the Court's then applicable COVID-19 Pandemic Arrangements Policy.

The evidence

1. Affidavits were read on behalf of each party. The affidavit on behalf of the Council was that of Mr Paul Crennan, the Council's legal representative, dated 2 November 2020, whilst that on behalf of the Company was from Ms Vatala, dated 16 November 2020. It is to be noted that portion of Ms Vatala's affidavit was read as relevant to the Company's (later discussed) motion, with the balance being read with respect to the Council's costs application.
2. A variety of documentary material was tendered.
3. The material exhibited to Mr Crennan's affidavit of 2 November 2020 was in two folders. The first of them (containing Tabs A to I) became Exhibit A, whilst that containing Tabs J to M became Exhibit B.
4. A folder of documents was exhibited to Ms Vatala's affidavit of 16 November 2020. The documents behind Tabs 9 to 14 of the folder were admitted as Exhibit 1 whilst the remainder of the folios were admitted as Exhibit 2. It is sufficient to note, for present purposes, that the material in these two exhibits comprised, primarily, correspondence between the Council or its legal representative, on one hand, and the Company's legal representative on the other.
5. On 7 December 2020, Ms Vatala gave an undertaking to the Court in terms later set out; an undertaking which became Exhibit 4.
6. In addition to the above material, a letter from the Council's legal representative to that of the Company, one dated 27 March 2019, was tendered on behalf of the Company - it became Exhibit 3.
7. Although the documentary material in Exhibits A, B, 1 and 2 was extensive, it was unnecessary for lengthy references to be made to much of that material, for the purposes of the confined matters now requiring determination. This is not said in any critical fashion - as the confining of the issues now between the parties, I accept, has removed that necessity. However, for each party, provision of the material at the time that the related affidavit was deposed meant that it was appropriate to provide the documentary material on a contingent basis.

Matters for determination

1. The parties agree that these proceedings should be discontinued, and I will so order.
2. However, three matters remain for determination. These are: 1. Whether the orders sought for the Company in its Notice of Motion filed on 30 November 2020 (addressed in the following section of this judgment) should be made; 2. Whether the leave to rely on the proposed Amended Summons and proposed Amended Points of Claim sought by the Council in its Notice of Motion filed on 3 September 2020 ought be granted; and 3. What orders for costs should be made in the finalisation of these proceedings?
3. It is convenient to deal with these outstanding issues in the order set out above.

Introduction

1. On 30 November 2020, the Company filed a Notice of Motion for the purposes of this hearing. Although the Company's Notice of Motion was filed only one week prior to the scheduled hearing (on 7 December 2020) of the outstanding issues between the parties, in my view it is appropriate to address this motion first in the sequence of my decision-making.
2. Whilst this position differs in minor respects from that which I had discussed with the parties during the course of the hearing, on reflection I am satisfied that doing so is the logically appropriate course for me to follow. I therefore turn to address the terms of the Company's Notice of Motion. The orders sought by the Company are: a. An order that these proceeding has have been settled in accordance with the parties' Short Minutes of Order contained at Tab 16 of exhibit SV-1 to the affidavit of Stephanie Vatala sworn and filed on 16 November 2020. b. An order that the Short Minutes of order referred to above be made by the Court pursuant to section 73 of the Civil Procedure Act 2005. c. An order that leave to amend the Applicant's Summons, as contained in the Applicant's Notice of Motion dated 3 September 2020, be refused as inconsistent with the parties' agreed resolution of these proceedings. d. The respondent's costs of the motion.

The relevant paragraph of Ms Vatala's affidavit

1. As can be seen from the terms of the first of the orders proposed for the Company, the outcome sought is predicated on a proper understanding of the Short Minutes of Order at Tab 16 of the documents exhibited to Ms Vatala's affidavit of 16 November and matters arising with respect to that document. To have a complete understanding of the framework pressed on behalf of the Company, it is necessary, first, to reproduce paragraph 22 of Ms Vatala's affidavit - a paragraph in the following terms: 22 At approximately 9.19am on 2 October 2020, I sent a further email to Crennan Legal attaching a clean copy of the agreed Short Minutes of Order, suggesting a copy be provided to his Honour Justice Moore, and requesting clarification on the Council's position with respect to its motion. A copy of my email, together with the agreed Short Minutes of Order, is at Tab 16.

The Short Minutes of Order at Tab 16

1. The Short Minutes of Order referred to above in order (a) of the Company's Notice of Motion of 30 November 2020 and referred to in paragraph 16 of Ms Vatala's affidavit was in the following terms: Orders 1 The Court notes the undertaking given by the Respondent, as set out at Annexure "A". 2 On the giving of the undertaking as set out in Annexure A, leave is granted to the Council to discontinue the proceedings on the basis that the costs of the proceedings are reserved for further hearing. 3 The proceedings are listed for a costs hearing on 4 The applicant is to file and serve any evidence it relies upon for the costs hearing by 5 The respondent is to file and serve any evidence it relies upon for the costs hearing by 6 The parties are to file outline written submissions on costs by

Section 73 of the Civil Procedure Act 2005

1. As can be seen from the terms of proposed order (b) sought in the Company's Notice of Motion, its statutory foundation lies in the terms of s 73 of the Civil Procedure Act 2005 (the Civil Procedure Act). The terms of this provision are: 73 Power of court to determine questions about compromises and settlements (1) In any proceedings, the court - (a) has and may exercise jurisdiction to determine any question in dispute between the parties to the proceedings as to whether, and on what terms, the proceedings have been compromised or settled between them, and (b) may make such orders as it considers appropriate to give effect to any such determination. (2) This section does not limit the jurisdiction that the court may otherwise have in relation to the determination of any such question.
2. It is necessary to consider whether that which is sought to be given effect by s 73 of the Civil Procedure Act is, as a matter of proper construction of this statutory provision, capable of providing such an effect.

The correspondence at Tab 16 of Exhibit SV-1

1. As can be seen from the Company's proposed order (a) and the above set out paragraph from Ms Vatala's affidavit, the Company relies upon "the agreed Short Minutes of Order" behind Tab 16 of Exhibit 2 (this being one part of the folder of documents exhibited to Ms Vatala's affidavit). It is necessary to set out some detail concerning the nature of the material behind Tab 16 before moving to consider the submissions made on behalf of the Company in support of its motion and those on behalf of the Council in opposition to it.
2. Before doing so, two matters should be noted with respect to the orders proposed in the Company's Notice of Motion of 30 November 2020.
3. First, the documents that are in Exhibit 2 behind Tab 16 contained, at folios 240 and 241, Short Minutes of Order setting out the proposed orders sought. However, the proposed undertaking in Annexure "A" sought to be embodied in order 1 was removed from the documents behind Tab 16 and became Exhibit 4 (when the undertaking it embodied was proffered by Ms Vatala at 10.29 am on the morning of the hearing).
4. Second, as can be seen from 3, 4 and 5 of the proposed orders contained in the noted Short Minutes of Order referenced as being behind Tab 16 of Exhibit 2, none contain a date necessary for the giving of effect to the differing elements contained in these three proposed orders - each is left "hanging" and incomplete. However, it is to be observed that, at the directions hearing on 2 October 2020 before me, in addition to setting the question of costs and the Council's 3 September 2020 Notice of Motion down for hearing on 7 December 2020, I also made the following timetabling directions: The Court directs that: 1 The applicant is to file and serve any evidence it relies upon for the costs hearing by 2 November 2020. 2 The Respondent is to file and serve any evidence it relies upon for the costs hearing by 16 November 2020. 3 The parties are to file outline written submissions on costs by 30 November 2020.
5. By necessary inference, I assume that the Notice of Motion is to be taken as proposing the relevant dates from my 2 October 2020 directions be incorporated to rectify the relevant omissions from paragraphs 3, 4 and 5 of the orders sought. I am satisfied these omissions are immaterial in the context discussed below of whether there would be power to use the advanced statutory provision to effect the outcome sought by the Company.
6. It is sufficient to note that, in addition to the Short Minutes of Order discussed above, the documents behind Tab 16 of Exhibit 2 comprised an e‑mail chain (of 11 e‑mails) at folios 229 to 239. These e‑mails commenced at 9.44 am on 14 September and concluded on 2 October 2020 at 9.19 am. It is unnecessary, now, to set out in detail the terms of these e‑mails.
7. Critically, the content of the e‑mail exchange on the morning of 2 October 2020 between Mr Crennan and Ms Vatala makes it clear that there was no agreement to the proposed Short Minutes of Order (the e‑mail conversation chain commenced at 8.16 am with an e‑mail from Mr Crennan and concluded at 9.19 am with an e‑mail from Ms Vatala to Mr Crennan).
8. This is further confirmed by the final two e‑mails in an e‑mail chain behind Tab 17 of Exhibit 2 where an e‑mail from Mr Crennan of 9.31 am makes it clear that the Council will pursue its Notice of Motion for leave to amend and the 9.33 am response from Ms Vatala making it clear that that motion will be opposed.

The submissions on the Company's motion

1. Written submissions for the Company were filed on 30 November 2020. These addressed not only the Company's Notice of Motion of 30 November but also the broader matters remaining in dispute between the parties. For present purposes, it is only necessary to consider these submissions to the extent that they are relevant to the Company's Notice of Motion.
2. Written submissions for the Council, separate from those dealing with the Council's motion or the general issue of costs, were filed on 7 December 2020. These submissions were confined to setting out the reasons why it was said for the Council that the Company's Notice of Motion of 30 November 2020 should not be granted.
3. In oral submissions, the advocates for each party canvassed that party's position concerning whether or not I should make the orders sought for the Company in its 30 November 2020 Notice of Motion. Those oral submissions, relevantly, amplified the general positions advanced in writing on behalf of each party.
4. It is unnecessary, for present purposes, to examine either of these positions in detail as they were both founded on either advancing support for invoking (for the Company), or accepting but resisting invoking (for the Council), of the proposition that s 73 of the Civil Procedure Act potentially provided a vehicle for me to make the orders sought in the Company's Notice of Motion.

Can s 73 of the Civil Procedure Act be used as the Company proposes?

Introduction

1. The Company's written submissions summarised, at paragraph 6, what was said to be the agreement reached between the parties as at 2 October 2020. This submission was in the following terms: 6 On 2 October 2020, the parties agreed to Short Minutes of Order in which the Applicant agreed to discontinue these Class 4 proceedings, with leave of the Court, on the basis that: a. the Respondent provide certain undertakings to the Court as set out at Annexure A to the Short Minutes of Order. Namely, that it will take steps to physically commence the Development Consent by 31 December 2020 and complete the works required by the Development Consent by 31 March 2021; and b. the question of costs be reserved for further argument: see email from Crennan Legal at 8.16am on 2 October 2020 at Tab 1615 of Ex SV-1. A copy of the parties' agreed Short Minutes of Order, with the Respondent's proposed undertakings, are at Tab 16 of Ex SV-1.
2. During the hearing, I had a discussion with Ms Vatala in order to understand what the position had been when the matter came before me on 2 October 2020. This discussion is recorded on pages 21 and 22 of the transcript of 7 December 2020. It is uncontested that, on 2 October, the Council sought to move on its motion for leave to rely on the proposed Amended Summons and proposed Amended Points of Claim and that this position was contested by Ms Vatala for the Company. As a consequence, that matter (inter alia) was stood over to be dealt with on 7 December. This provides a further clear indication that, on 2 October, all matters between the parties were not the subject of a settlement agreement.
3. In this context, before turning to address jurisdictional prerequisites, it is noted that the Council's written submissions, at paragraph 10, acknowledged that: Costs of the proceedings have always remained a live issue between the parties.
4. In paragraph 15 of the written submissions on behalf of the Council, the proposition was also advanced that: 15 In GR Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd (1986) 40 NSWLR 631, McHugh JA (with Kirby P and Glass JA agreeing) noted at p634 that the decisive issue on whether the parties have entered into a contract to settle is 'always the intention of the parties which must be objectively ascertained from the terms of the document when read in the light of the surrounding circumstances: [citations omitted].
5. Although this paragraph in the written submissions continued, saying: The circumstances of the 'agreement' in this case is that it was predicated on the applicant's Amended Summons. The offer to settle the proceedings was put and accepted on that basis, it is not necessary to address this latter portion of the paragraph concerning the Amended Summons (as my consideration is, at this point, confined to addressing the availability or otherwise of s 73 of the Civil Procedure Act).

Why s 73 of the Civil Procedure Act is not available to determine the outcome

1. For reasons explained below, I am satisfied that, whatever was agreed between the parties, there was no compromise or settlement of the proceedings between the parties. Therefore, the power given by s 73 of the Civil Procedure Act to permit some adjudication of what the terms were of such compromise or settlement was not enlivened.
2. It is undoubtedly the position, consistent with that which was set out in GR Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd (1986) 40 NSWLR 631, that the terms of the document embodying what is said to be a settlement must be ascertained by an examination of the document itself when understood in the context of the arrangement for reaching what are said to be the terms of settlement.
3. As I have earlier noted, there is no dispute between the parties that, to the extent that the parties envisaged a settlement of merit matters relating to the commencement and completion of the remediation works agreed to as part of the s 34 conciliation process presided over by the Senior Commissioner, the question of the costs of these Class 4 proceedings were never subject to any agreement between the parties. Potential liability for those costs remained in dispute - as evidenced by the necessity for the final portion of this decision.
4. This is clear from not only the relevant extracts from each of the written submissions, but also from items 17(g) to 17(r) of the written submissions on behalf of the Company that, at most, there was agreement as to the appropriateness of commencement and completion dates for the remediation works being mandated (the elements of the written submissions are a summary of the correspondence between the parties between 2 September and 2 October 2020. It will later be necessary to reproduce the entirety of this summary of the correspondence chain).
5. For present purposes, to exercise the power in s 73 of the Civil Procedure Act, it is necessary that I can be satisfied that "the proceedings have been compromised or settled between the parties" as a foundational point to determining the terms upon which that might have occurred.
6. I am unable to find any authority that expressly defines what might constitute a compromise or settlement that is capable of being brought under the umbrella of s 73 of the Civil Procedure Act in order to invoke jurisdiction to exercise the power contained in that provision.
7. To the relevant extent that Court of Appeal authority provides guidance, it is to the effect that any bargain asserted to have been reached between the parties to litigation must be an agreement that was contemplated by those parties to comprehend all issues in dispute between them.
8. In Gorczynski v Bendigo and Adelaide Bank Ltd [2016] NSWCA 170 at [6], Basten JA described the scope of the power conferred by s 73 in the following terms Section 73 (and its analogues in other jurisdictions) has been understood to confer power on the court to deal with settlements in the proceedings to which they relate, rather than leaving the parties to commence separate proceedings to enforce a settlement.
9. In Kabir Ahmed & Ors v Ayubur Rahman Chowdhury & Ors [2011] NSWSC 893, Slattery J observed, at [4]: Before the enactment of Civil Procedure Act, s 73 there were different judicial views as to whether an alleged settlement of proceedings could be enforced by motion in the proceedings or whether a separate action needed to be commenced: [citations omitted]. Now Civil Procedure Act, s 73 resolves these different views and makes clear that the Court has jurisdiction to determine any dispute between the parties to the proceedings as to whether and on what terms the proceedings have been compromised: Civil Procedure Act, s 73(1)(a).
10. Of assistance in deriving a proper understanding of what might constitute a settlement falling within the scope of the statutory provision is a decision of the Court of Appeal in Grave v Blazevic Holdings Pty Limited [2012] NSWCA 329 (Grave v Blazevic). The leading judgment was delivered by Bergin CJ in Eq (with Campbell JA agreeing with additional remarks; Barrett JA agreeing). This was an appeal from a decision of Nicholas J in Blazevic Holdings Pty Ltd v Warwick S Grave [2011] NSWSC 1504, where his Honour was required to consider whether or not the parties to those proceedings should be held to have reached an agreement for the settlement of all issues in dispute between them.
11. Although this first instance decision does not deal, in terms, with s 73 of the Civil Procedure Act, it nonetheless provides useful guidance on what might be needed to be encompassed by a settlement to be capable of falling within the scope of that statutory provision. At first instance, and on appeal, reference was made to a decision of the High Court in Masters v Cameron (1954) 91 CLR 353; [1954] HCA 72 (Masters v Cameron).
12. Although Masters v Cameron was a case concerning a contract relating to the purchase of land, that which is to be seen from the reasoning of the High Court in that decision was applied in Grave v Blazevic and has relevance for the present purposes.
13. The High Court described, at 360, three possible classes within which such an agreement between parties might be characterised. The Court said: Where parties who have been in negotiation reach agreement upon terms of a contractual nature and also agree that the matter of their negotiation shall be dealt with by a formal contract, the case may belong to any of three cases. It may be one in which the parties have reached finality in arranging all the terms of their bargain and intend to be immediately bound to the performance of those terms, but at the same time propose to have the terms restated in a form which will be fuller or more precise but not different in effect. Or, secondly, it may be a case in which the parties have completely agreed upon all the terms of their bargain and intend no departure from or addition to that which their agreed terms express or imply, but nevertheless have made performance of one or more of the terms conditional upon the execution of a formal document. Or, thirdly, the case may be one in which the intention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract.
14. What is here important, for the purposes of considering what is advanced on behalf of the Company as being appropriate to be regarded as a settlement for the purposes of s 73 of the Civil Procedure Act, is that all three classes considered by the High Court, although having different consequences for enforceability, encompassed circumstances where all major elements had been agreed between the parties to the proposed contract. The only disputes potentially arising related to minor deferred matters or the methodology for formalisation of the agreement. No significant outstanding issues were set aside for future resolution.
15. The above analysis is on all fours with the approach taken by Sackar J in Bobi Damcevski v Emilios Demetriou & Ors [2018] NSWSC 988 in setting out the framework within which to consider whether a settlement or comprise has in fact been agreed in the fashion necessary to permit the section to be invoked (noting that the possible fourth category discussed by his Honour at [76] and [77] has no relevance here).
16. In this instance, there is no such complete agreement about the matters that are in contest.
17. Taking the Company's case at its highest (being a matter not, in this regard, subject to significant dispute by the Council), there was, as at 2 October 2020, agreement only that there should be a mandated commencement day for the remediation works and, for the purposes of finalisation of that aspect of these proceedings, there would be a mandated completion date for them.
18. However, there was no agreement as to costs of the proceedings (a matter remaining as a significant contested element between the parties) and, although of much lesser importance in context I accept, there was no agreement as to what should be the fate of the Council's Notice of Motion of 3 September 2020.
19. As at 2 October 2020 (and carrying over until the hearing giving rise to this decision), these two questions of substance remained unresolved between the parties (thus becoming the subject of this decision). Those questions remained the subject of vigorous dispute between the parties at the 7 December 2020 hearing.
20. Under the circumstances, I am satisfied that there is no basis upon which I could conceivably conclude that "the proceedings have been compromised or settled" between the Council and the Company.
21. The inability so to conclude means that the necessary fundamental premise for engagement of s 73 of the Civil Procedure Act is not satisfied, because the answer to the question "whether … the proceedings have been compromised or settled" must be "no".
22. As the availability of use of this provision is fundamental to the potential making of orders 1 and 2 of the orders proposed by the Company's 30 November 2020 Notice of Motion as being defining of the terms of the alleged "settlement or compromise" between the parties, it follows that there is no power for me to make orders in the terms sought.
23. The necessary result of this is that the Company's Notice of Motion of 30 November 2020 must be dismissed.

Introduction

1. As earlier noted, on 3 September 2020, a Notice of Motion was filed for the Council seeking leave to rely on a proposed Amended Summons and proposed Amended Points of Claim. The terms of the proposed Amended Summons and proposed Amended Points of Claim have earlier been set out.
2. As can be seen from the terms of the proposed Amended Summons, the operative relief proposed to be sought was to be confined to an order requiring the Company to complete the necessary remediation works agreed to by the Company and embodied in the orders made by the Senior Commissioner giving effect to the outcome of the conciliation conference which she had conducted.
3. As will later be clear, this revised approach, on behalf of the Council was first raised with the Company's legal representative by e‑mail of 2 September 2020 by the Council's legal representative. In my later consideration of the remaining costs issue, I set out a summary of correspondence between the parties' legal representatives from 2 September to 2 October 2020.
4. The Council's Notice of Motion was set down before me on 2 October 2020. On that occasion, Ms Vatala indicated that the Council's motion was opposed. As a consequence, consideration of it was deferred (together with the issue of costs of the proceedings) to the hearing before me on 7 December 2020 giving rise to this decision.

Introduction

1. The Council's written submissions, at paragraphs 13 to 19, included a short chronology for the period from August to mid-September 2020. That chronology (omitting editorialising comments) is set out below: 13 Following a detailed assessment of the amended application, the Council entered into an agreement pursuant to s34(3) of the Land and Environment Court Act 1979. 14 Up until 2 September 2020, the respondent offered to resolve the class 4 proceedings on the basis that it give an undertaking to the Court and to Council to 'physically commence the development consent' by 31 December 20208. No indication of the works that were to be carried out to 'physically commence' the development consent were given by the respondent. 15 … 16 Council filed a Notice of Motion seeking leave to amend the Summons and Points of Claim on 3 September 2020 seeking a declaration as to breach and an order that the respondent not merely 'physically commence' the works subject of the development consent but complete those works by 4 December 2020. 17 … 18 By correspondence dated 14 September 2020, the respondent's solicitors renewed an offer to resolve the class 4 proceedings by giving an undertaking to the Court to complete the works by 31 March 2021 (some 3 years after the commencement of the class 4 proceedings). The offer was put on the basis that it was only made as a result of Council's application to amend the relief in the class 4 proceedings to complete the works subject of the development consent. 19 The Council agreed to resolve the class 4 proceedings on the basis that the respondent give an undertaking to the Court to complete the works subject of the development consent by 31 March 2021.
2. It is to be noted that the orders to give effect to the above cited s 34 agreement were made by Dixon SC on 21 August 2020.

The Council's position on why leave to amend should still be granted

1. During the hearing, I had an exchange with Mr Hemmings concerning the Council still pressing to be given leave to amend after the Company had proffered the further element of the undertaking mandating a completion date for the remediation works. It is sufficient to reproduce the transcript extract setting out this exchange to understand the Council's final position on this aspect of that with which I need to deal. The terms of the exchange were (Transcript 7 December 2020, page 26, line 50 to page 27, line 35): HIS HONOUR: But isn't your position in fact that your client's Notice of Motion to amend became the Damoclean sword that gets to the undertaking? At least as I understand you, you say to me your client's Notice of Motion being, to use a planning expression, imminent but not certain, was the trigger for the agreement, and that in that respect is it not irrelevant whether I grant leave to amend or not? Given that the Notice of Motion on your case caused the undertaking to be given in the form finally proffered to the Court? HEMMINGS: That's entirely correct, your Honour. That's why I started in the - as I did, I tried to start in the short hand way, rather than the long hand way, and simply say - and that's why I don't understand the opposition to the amendment, because that would be the easy way to deal with it, because HIS HONOUR: Yes, but isn't the flip side of that that it's not necessary to amend either HEMMINGS: No, it[s] not. HIS HONOUR: under those circumstances? I mean, you put the proposition to me, do you not, that in the overall scheme of things the scaffolding, to use the word that I utilised earlier, is in place as a consequence of the September filing of the motion, and what flowed from that to stimulate the agreement that has now been reached. HEMMINGS: I have to accept that, your Honour. It gives rise to the course of correspondence, and your Honour is entitled to take that into account on each of the three motions, frankly. It would ultimately be - the amendment to the summons only becomes necessary, if I can express it in that way, deliberately using the language of necessity. It only becomes necessary if your Honour could not otherwise be satisfied to accept the undertaking without the amendment. Now, your Honour, has already accepted the undertaking, so arguably that is an answer to the inquiry to the question of whether, and this is the basis upon which we put it, for abundant caution it's appropriate to have the pleadings in relation to the undertaking documents.

The Company's position

1. In her written submissions, under the heading "Later attempt by applicant to amend for purpose of obtaining costs and in breach of parties' agreement", Ms Vatala relevantly addressed the Council's continuing to seek leave to rely on its proposed Amended Summons and proposed Amended Points of Claim. These submissions were set out in paragraphs 26 to 28 of her written submissions.
2. Paragraph 27 is not relevant because of my earlier set out conclusion explaining why there was no basis for the Company seeking to rely on s 73 of the Civil Procedure Act to have me give effect to the outcomes sought by the Company in its 30 November 2020 Notice of Motion. However, for present purposes, paragraphs 26 and 28 are relevant for my consideration of whether the Council should be granted leave to rely on its proposed Amended Summons and proposed Amended Points of Claim. These paragraphs of Ms Vatala's written submissions were in the following terms: 26 The Applicant, despite agreeing to discontinue these proceedings in the terms set out in the parties' agreed Short Minutes of Order at Tab 16 of Ex SV-1, is now, by pursuing its Notice of Motion served on 3 September 2020, seeking to amend its Summons to advance its position on costs. The Respondent cannot understand there to be any other motive for the Applicant pursuing its amendments, given the Applicant has no intention of prosecuting the Class 4 proceedings on the basis of its proposed amended relief, as indicated by its agreement to discontinue the proceedings in accordance with the Short Minutes of Order at Tab 16 of SV-1. 27 … 28 Even if the Applicant's conduct in pursuing its Notice of Motion dated 3 September 2020, seeking leave to amend its pleadings, is not a breach of the contractual agreement between the parties, the Court would not, in its discretion, having regard to the dictates of justice (required by s58 of the CPA) to achieve the overriding purpose of facilitating the "just, quick and cheap resolution of the real issues in the proceedings" (see s56 of the CPA) and having regard to s64(2) of the CPA which provides that "all necessary amendments are to be made for the purpose of determining the real questions raised", grant leave to the Applicant to amend its pleadings at this late stage when the substantive issues in the proceedings have been resolved between the parties. There is no utility.
3. As can be seen, the Company advances the lack of relevant necessity to amend as the basis for proposing that the leave to amend should be rejected.

Consideration

1. I have earlier set out the Council's summary chronology (which I accept and adopt) of the exchanges between the legal representatives of the Company and the Council from 2 September 2020 (when the Company was only proposing to give an undertaking to commence the necessary remediation works) and 14 September 2020 (when the Company's position significantly shifted and expanded to encompassing offering an undertaking for a mandated completion date for those remediation works).
2. What, it is to be asked rhetorically, could be inferred as the cause for this significant shift in the Company's position?
3. The only rational answer to such a rhetorical question is the filing of the Council's Notice of Motion of 3 September 2020 seeking to rely on an Amended Summons that would mandate the imposition of a completion date of those works. The only contextually appropriate conclusion to be drawn is that the Council's procedural step seeking to engage the ability to have a mandated completion date ordered as an outcome of the proceedings triggered the significant shift in the Company's position.
4. Ms Vatala submitted, in this context, that the proposed completion date foreshadowed by the terms of the Council's proposed Amended Summons (that proposed date being 4 December 2020) differed from the 31 March 2021 completion date in the undertaking eventually given on behalf of the Company on 7 December 2020.
5. Given that the December 2020 completion date proposed in the Council's motion was some three months after the filing of the motion and that the completion date in the undertaking given on 7 December 2020 involved a period only a few weeks longer than the three months sought by the Council at the time of filing of its September 2020 motion, nothing of significance is to be drawn from this. That is particularly so in light of the matters pressed on behalf of the Company as to the difficulties potentially facing it in seeking to execute the remediation works during a period which spanned Christmas and January 2021.
6. The timing difference, is, therefore, a mere distraction and not a matter of substance.
7. However, the Company's indication, in the 14 September 2020 letter to Mr Crennan, that it was prepared to give an undertaking as to a completion date for the remediation works removed the necessity for the Council to seek to have such a completion date imposed by the Court.
8. Against this, the symbolic acknowledgement of that causal relationship if the Council's September 2020 motion was to be granted to permit reliance on the proposed Amended Summons and proposed Amended Points of Claim is not to be ignored.
9. It was advanced for the Company that I should not grant the Council leave to amend because there was an agreement between the parties based on the Company's proposed undertaking that rendered there being no utility in permitting the amendment. In this context, I observed (Transcript 7 December 2020, page 17, lines 24 to 25) that: HIS HONOUR: I don't understand I'm being asked to grant the relief. I'm being asked to scaffold part of a framework, if I could put it that way.
10. Following that comment, Ms Vatala made submissions based on correspondence of 14 September 2020 from her to the Council's legal representative. It is unnecessary to set out, in detail here, the nature of her submissions or the terms of the letter. It is sufficient to quote what she submitted (and which I take to be a concise summary of her client's position) at page 18, lines 43 to 47 of the transcript of 7 December 2020, this being in the following terms: VATALA: ..so, your Honour, it's clear that our client's position was as at 14 September that it wanted to avoid a hearing on the council's application to amend and the offer given to complete the works by 31 March 2021 was in an effort to resolve the class 4 proceedings and to avoid importantly the question of whether or not the council should be granted amended relief.
11. This makes it clear that, whatever else may have followed in subsequent correspondence between the parties, it is incontrovertibly the position that the event, which stimulated the Company to adopt the position of being prepared to give an undertaking embodying a completion date for the required remediation works (as well as agreeing to a mandated commencement date for those works) was the Council's Notice of Motion seeking to rely on its proposed Amended Summons and proposed Amended Points of Claim.
12. This is not only relevant on this element of the proceedings as to whether or not I should grant leave to the Council to rely on the proposed Amended Summons and proposed Amended Points of Claim but is also critical, for the reasons I later describe, to provide a basis for my conclusion that the Company should be liable for the Council's costs of the proceedings.
13. There are two reasons why I am satisfied that it is appropriate to grant the Council leave to rely upon its proposed Amended Summons and proposed Amended Points of Claim.
14. First, I am satisfied that, on balance, the continued presence of the Damoclean sword of the Notice of Motion and its potential outcome were significant matters in maintaining pressure on the Company to give the undertaking embodying a completion date for the remediation works. Indeed, the fact that a not insignificant portion of the early part of the hearing on 7 December 2020 involved exploration of the appropriate sequencing of events to arise from the hearing (prior to the giving of the undertaking in Exhibit 4) means that granting leave to amend constitutes an appropriate acknowledgement of causation leading to the substantive resolution effected by the undertaking.
15. In addition, although of lesser importance, I am also satisfied that granting leave in the fashion sought by the Council provides a proper foundational understanding of the circumstances of the giving of the undertaking against the event (unlikely, it is to be hoped) that the Company might not complete the remediation works by the (now extended) date to which it has committed for their completion.
16. It is, therefore, appropriate to resolve the Council's 3 September 2020 Notice of Motion by granting the leave to amend sought by it.

The Company's undertaking to the Court

1. As earlier noted, during the early portion of the hearing on 7 December 2020, Ms Vatala proffered an undertaking on behalf of the Company that would have the effect of mandating a completion date (31 March 2021) for the remediation works.
2. The position advanced on behalf of the Council was that I should not accept the undertaking proffered on behalf of the Company until after I had dealt with the Council's application for leave to rely on its proposed Amended Summons and proposed Amended Points of Claim (Transcript 7 December 2020, page 10, line 46 to page 11, line 1).
3. Mr Hemmings, however, did submit that accepting the undertaking would reflect the substantive relief that was sought by the Council in the proceedings. This, he submitted, as I understood it, supported the proposition that the Council's proposed pleading amendments should be granted in order to make it clear that the undertaking given on behalf of the Company was appropriately reflecting the relief which the Council sought in the proceedings, a reflection which would be effected by granting the Council the leave sought in its Notice of Motion of 3 September 2020 (oral submissions - Transcript 7 December 2020, page 11, lines 26 to 48).
4. At page 16 of the transcript of 7 December 2020, I set out elements that I would incorporate in this decision addressing how I would describe my determination of the Council's Notice of Motion seeking leave to rely on its proposed Amended Summons and proposed Amended Points of Claim. I now do so in the fashion described in the transcript at page 16, lines 8 to 16.
5. In the context of what I have set out above, for reasons earlier set out, it is appropriate that I grant leave to the Council to rely on its proposed Amended Summons and proposed Amended Points of Claim as sought in its Notice of Motion of 3 September 2020.
6. Having concluded that I should grant that leave, I now note that, having done so, it is appropriate to address the undertaking to the Court proffered by Ms Vatala on behalf of her client on the morning of the hearing.
7. I was proffered the undertaking, and I have accepted it, on the basis that I have agreed to the application on behalf of the Council to rely on its proposed Amended Summons and proposed Amended Points of Claim.
8. The proffered and accepted undertaking is in the following terms: UNDERTAKING TO THE COURT The Respondent, Kiangatha Holdings Pty Ltd (CAN 129 497 856) ('Kiangatha'), by its solicitor, gives the following undertakings to the Court: a. On or by 31 December 2020 Kiangatha will take steps to physically commence the Development Consent DA-10.2019.15.1 as granted by the Court on 21 August 2020 ("the development consent"); and b. Kiangatha will, either by itself or its agents and assigns, complete the rehabilitation works on the closed tracks and the stabilisation works on the open tracks required by the development consent ("the works") by 31 March 2021.
9. On 7 December 2020, I accepted that undertaking (Transcript 7 December 2020, page 16, lines 31 and 32).

The time for compliance is subsequently extended

1. For completeness, it is appropriate to note that, on Thursday 25 March 2021, a Notice of Motion was filed on behalf of the Company seeking to extend the time for compliance with the undertaking from 31 March to 31 May 2021. This application was made because of the impact of the extraordinarily heavy rainfall which had fallen in the region of the property during March 2021 and the consequential difficulties arising for the Company's contractor to complete the agreed remediation works.
2. During a short hearing before me on the same afternoon, the Council's legal representative indicated that the proposed extension of the completion time for the remediation works was not opposed. As the consequence, the proffered modification to the undertaking to require the remediation works to be completed by 31 May 2021, in lieu of 31 March 2021, was accepted.

Introduction

1. The final matter requiring to be dealt with is what should be the costs outcome of these Class 4 proceedings, there being no agreement between the parties as to what should be the appropriate costs order to be made.
2. The ordinary position which would apply in circumstances such as these, where the party initiating the proceedings subsequently proposes to discontinue them, is set out in r 42.19 of the Uniform Civil Procedure Rules 2005 (the UCPR). The provision is in the following terms: 42.19 Proceedings discontinued (1) This rule applies to proceedings that are discontinued by the plaintiff, as referred to in rule 12.1. (2) Unless the court orders otherwise or the notice referred to in rule 12.1(2) otherwise provides, the plaintiff must pay such of the defendant's costs as, at the date on which the notice of discontinuance was filed, had been incurred by the defendant in relation to each claim in respect of which the proceedings have been discontinued. (3) …

The Council's position

1. The position advanced by Mr Hemmings for the Council is a simple one, one not requiring a complex explanation. As advanced in the written and oral submissions on behalf of the Council, I am asked to conclude that the position revealed by the correspondence between the parties' legal representatives, immediately prior to advice on behalf of the Council that it proposed to seek a mandated completion date for the remediation works when compared with the position adopted on behalf of the Company after this proposed revised outcome was foreshadowed, clearly demonstrates a tipping point. This tipping point resulted in the position adopted on behalf of the Company shifting radically so that the Company then agreed to a mandated completion date for the required remediation works.
2. This, it was submitted for the Council, constituted capitulation by the Company - with that capitulation removing the necessity for a contested hearing and making it appropriate that the proceedings be discontinued after the formalisation of an undertaking by the Company accepting the mandated completion date.
3. Although a change to the completion date initially advanced by the Council was necessary, this necessity arose solely because, on 2 October 2020, when the Council sought to move on its Notice of Motion to rely on its proposed Amended Summons and proposed Amended Points of Claim, the Company opposed that occurring. This necessitated an adjournment to permit a hearing on that question (and on the question of costs for the Class 4 proceedings, generally) to be held.
4. Solely because of that adjournment of a little more than two months before a hearing could be held to formalise the now agreed position between the parties, an adjustment of the mandated completion date was necessary. This, it was the Council's position, did not alter the fundamental position that the Company had capitulated on the sole substantive issue remaining in dispute when it had offered, in its legal representatives' letter of 14 September 2020, to agree to a mandated completion date in response to the Council's proposed Amended Summons and proposed Amended Points of Claim.
5. The effective surrender by the Company therefore engaged one of the exceptions to the general principles applicable to proceedings which are discontinued. The capitulation by the Company to the Council, by agreeing to a mandated completion date for the remediation works, rendered it appropriate that the power in r 42.19(2) of the UCPR be engaged to "otherwise order" in these circumstances. The appropriate order under these circumstances was that the Company should pay the Council's costs of the proceedings.

The Company's position

1. The position advanced on behalf of the Company is that there was no surrender to the Council and that a proper examination of the correspondence between the parties throughout the relevant period demonstrates that the Council had always had available to it proper and appropriate mechanisms to require the Company to complete the remediation works if the Council considered that the Company was being dilatory in its carrying out of those works.
2. As the Company had offered that there be a mandated commencement date for the remediation works, the subsequent preparedness of the Company to accept a mandated completion date was merely part of what can be seen to be a conventional ebb‑and‑flow of negotiations between the parties.
3. The chain of correspondence between the parties' legal representatives, commencing on 2 September 2020 and running through to the attendance before me on 2 October 2020, demonstrated, it was submitted, that the failure to have the matter resolved (except for the question of costs) at the hearing on 2 October was solely caused by the Council's insistence on seeking to be granted leave to rely on its proposed Amended Summons and proposed Amended Points of Claim.
4. In summary, there was no capitulation by the Company and a proper understanding of the chain of correspondence demonstrated that there was no unreasonable conduct on behalf of the Company throughout the relevant period from the beginning of September to the hearing before me on 2 October 2020.
5. Ms Vatala set out, in her written submissions, what was said to be a concise but sufficiently detailed summary of the correspondence between the parties throughout the relevant period. It is appropriate, at this point, to reproduce the relevant portion of her written submissions containing her summary of this correspondence. The summary appears at paragraph 17 of those submissions and is in the following terms: g. 2 September 2020 (Tab 8, p 163 of Ex SV-1) - Dentons without prejudice save as to costs letter referring to the Development Consent and advising that Kiangatha would now provide an undertaking to the Court and to the Council to physically commence the consent by 31 December 2020. Having 12 90926017.1 physically commenced the consent, if Kiangatha does not complete the works then Council has power under the EP&A Act to issue a "Complete Works Order" requiring Kiangatha to complete the work within a specified time frame. Dentons expresses the view that this was sufficient comfort for the Council that the works required by the consent and so no orders required in Class 4 proceedings. Accordingly, each party should pay its own costs of the Class 4 proceedings. h. 3 September 2020 (Tab 9, p 165 of Ex SV-1) - Email from Crennan Legal with Notice of Motion and affidavit in support seeking leave to amend its Summons to: i. Seek a modified form of declaration that Kiangatha breached the EP&A Act by carrying out works associated with creation of the tracks; and ii. An order that by 4 December 2020 Kiangatha complete the works required by the Development Consent. i. 3 September 2020 (Tab 10, p 181 of Ex SV-1) - Email from Dentons expressing the view that by the grant of the Development Consent and Kiangatha's proposed undertaking to the Court and to Council to physically commence the consent by 31 December 2020, there is nothing left in the Class 4 proceedings and the Council's Notice of Motion is, in Dentons' opinion, misconceived and will result in further unnecessary costs. Kiangatha will oppose the motion and reserves its position on costs. j. 14 September 2020 (Tab 11, p 183 of Ex SV-1) - Dentons letter (following the directions hearing in the Class 4 proceedings on 4 September 2020 at which the Council's Notice of Motion was set down for hearing on 2 October 2020) setting out, amongst other things; i. Kiangatha's previous offer to settle the Class 4 proceedings on the basis of an undertaking to the Court and to the Council to physically commence the consent by 31 December 2020; ii. Kiangatha's renewed offer to provide an undertaking to the Court and to the Council to complete the works required by the Development Consent by 31 March 2021, given the Council's motion to amend and in an effort finally resolve the Class 4 proceedings; 13 90926017.1 iii. Seeking agreement to Council discontinuing the proceedings on the basis that Kiangatha provide an undertaking to the Court and to the Council to complete the works required by the Development Consent by 31 March 2021; iv. Advising that if Council continued to press for amended relief as set out in its motion, Kiangatha would rely on the letter on the question of costs; and v. Again set out Kiangatha's position that, having regard to the history of the matter, each party should pay its own costs of the Class 4 proceedings. k. 16 September 2020 (Tab 12, p 187 of Ex SV-1) - Crennan Legal email setting out the terms of Applicant's agreement to discontinue the Class 4 proceedings, namely: i. Kiangatha to provide an undertaking to the Court on 2 October 2020 to physically commence the Development Consent by 31 December 2020; ii. Kiangatha to provide an undertaking to the Court on 2 October 2020 to complete the work required by the Development Consent by 31 March 2021; iii. Costs to be reserved for further hearing. l. 30 September 2020 (Tab 13, p 194 of Ex SV-1) - Crennan Legal email attaching proposed Short Minutes of Order setting out the above terms. m. 1 October 2020 (Tab 14, p 206 of Ex SV-1) - Dentons email with marked-up amendments to the Short Minutes of Order and advising that the two undertakings will be provided to the Court on behalf of Kiangatha on 2 October 2020. n. 2 October 2020 at 8.16am (Tab 15, p 219 of Ex SV-1) - Crennan Legal email advising that Kiangatha's amendments to the Short Minutes Order and proposed undertakings are acceptable and stating "We assume that the amendments we sought to the Summons are not contested and are therefore consented to." o. 2 October 2020 at 8.52am (Tab 15, p 219 of Ex SV-1) - Dentons email advising that the amendments sought in the summons (annexed to the motion) are inconsistent with the undertakings Kiangatha will give to the Court 14 90926017.1 and that if Council continues to press for leave to rely on the amended summons, it will be vigorously opposed. p. 2 October 2020 at 9.19am (Tab 16, p 229 of Ex SV-1) - Dentons email attaching agreed Short Minutes of Order without mark-ups and seeking clarification on Council's position with respect to its motion. q. 2 October 2020 at 9.31am (Tab 17, p 243 of Ex SV-1) - Crennan Legal email advising, amongst other things, "The amendments are entirely consistent to enable the undertaking to properly relate to the subject matter of the proceedings and are pressed". r. 2 October 2020 at 9.33am (Tab 17, p 243 of Ex SV-1) - Dentons email advising there is a difference of opinion and the Applicant's motion will be opposed.
6. It is to be noted that, immediately after the third item in the chain of correspondence set out above, the Council did, in fact, file its Notice of Motion seeking to rely on its proposed Amended Summons and proposed Amended Points of Claim.
7. It was Ms Vatala's submission that a proper consideration of the conduct of both parties, particularly (as I understood it), between 2 September and 2 October 2020 meant that the appropriate costs order from the Class 4 proceedings should be that there be no order as to costs, with the outcome being that each party would bear its own costs of the proceedings.
8. Ms Vatala relied upon the nature of that which was pleaded by the Council in its original Summons as providing the proper basis for understanding the background to which I should have regard for understanding the position adopted by the Company (this was discussed by her in her oral submissions at Transcript 7 December 2020, page 36, line 42 to page 37, line 20).
9. In particular, at this point, she submitted that, although the Council had much earlier proposed another Amended Summons (being an amended version differing from that which I have earlier considered as arising from the Council's Notice of Motion of 3 September 2020 as being appropriate for the granting of leave), the earlier proposed Amended Summons was not pursued by the Council. As a consequence, the original Summons was that which provided at least a backdrop to the Class 1 proceedings that were resolved by the Senior Commissioner successfully assisting the parties to reach a conciliated outcome resulting in the orders which she made on 21 August 2020.
10. In addition, Ms Vatala relied, for contextual understanding in the present proceedings, on the remediation works required to be carried out by the Company as a result of intervention by WaterNSW.
11. Ms Vatala also submitted, based on the Council's legal representatives' letter of 27 March 2019 (Exhibit C), that the activities agreed to be undertaken by the Company arose out of the remediation works the subject of the consent orders made by Robson J in June 2019 in response to the intervention by WaterNSW.
12. Ms Vatala also took me through what she submitted demonstrated that that which was necessary to be undertaken by the Company derived from those lengthy negotiations between the Company and WaterNSW, negotiations of which the Council was aware (Transcript 7 December 2020, page 39, line 21 to page 41, line 48).
13. However, it was Ms Vatala's broader submission that the Council had commenced these Class 4 proceedings prematurely and that, as a consequence, the outcome of them, from the Company's perspective, should be conceptually viewed not solely through the Council's actions but also, more predominantly, as a consequence of the interventions by WaterNSW.
14. This, she submitted, established that there had been no capitulation or surrender by the Company to the Council in the context of theses Class 4 proceedings. Ms Vatala also submitted that a proper examination of the whole of the correspondence demonstrated that there was no unreasonable conduct by the Company in these Class 4 proceedings.

Discontinuance principles

1. A summary of principles to be considered when proceedings such as these are discontinued without a hearing on the merits and where costs remain in dispute between the parties was set out by Preston CJ in Kiama Council v Grant (2006) 143 LGERA 441; [2006] NSWLEC 96 (Kiama Council), at [80], with this summary being in the following terms: Summary of principles 80 The principles that emerge from these cases are that in a civil enforcement or judicial review case where there has been no hearing on the merits: (a) where one party effectively surrenders to the other party by: (i) discontinuing without the consent of the other party; or (ii) giving undertakings to the Court or submitting to the Court making orders against the party substantially in the terms or to the effect claimed by the other party; the proper exercise of the costs discretion will ordinarily be to make the usual order as to costs, unless there is disentitling conduct on the part of the other party; and (b) where some supervening event or settlement so removes or modifies the subject of the dispute that no issue remains except that of costs, the proper exercise of the costs discretion will ordinarily be to make no order as to costs unless: (i) one of the parties has acted so unreasonably that the other party should obtain the costs of the action; or (ii) even if both parties have acted reasonably, one party was almost certain to have succeeded if the matter had been fully tried so that the party should obtain the costs of the action.
2. In this context, it is to be observed that, in adopting this summary, his Honour set out the discussion by McHugh J in Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Qin (1997)186 CLR 622; [1997] HCA 6 (Lai Qin), at 624 and 625, and comments by Burchett J in OneTel Limited v Commissioner of Taxation (2000) 101 FCR 548; [2000] FCA 270 as providing a proper basis for understanding the approach which had been taken in this Court on the question of whether or not to order costs in Class 4 of the Court's jurisdiction.
3. This approach, adopted by Preston CJ in those proceedings at first instance in Kiama Council, was, more recently, considered by the Court of Appeal in Ralph Lauren 57 Pty Ltd v Byron Shire Council (2014) 199 LGERA 424; [2014] NSWCA 107 (Ralph Lauren). Preston CJ wrote the judgment in Ralph Lauren (with Beazley P and Ward JA agreeing). His Honour canvassed the broad principles governing costs orders in circumstances such as these at [20] to [34].
4. The general costs principles, here appropriate to be considered, are those set out in Ralph Lauren at [26] - particularly the position in the present matter as to whether the outcome could sustain my finding, without any hypothetical trial of an issue, that the Applicant had succeeded on all issues pressed in a fashion demonstrating complete surrender by the Respondents. The relevant paragraph from Ralph Lauren is in the following terms: 26 Unreasonableness of conduct can also be found in a defendant continuing to defend litigation until it then surrenders to the plaintiff by consenting to the court making orders, or giving an undertaking to the court, in substantially the same terms and effect as sought by the plaintiff in the proceedings: see Edwards Madigan Torhillo Briggs Pty Ltd v Gloria Stack [2003] NSWCA 302 at [5]; Kiama Council v Grant [2006] NSWLEC 96; (2006) 143 LGERA 441 at [56], [60]-[71], [80]; Ku-ring-gai Council v Minister for Planning (No 2) [2008] NSWLEC 276 at [25], [26]; and Hall v Ku-ring-gai Council [2009] NSWSC 370 at [39]-[48]. This is not a settlement of the litigation in the ordinary sense, but rather a surrender to the plaintiff. In this circumstance, although there has not been a trial on the merits, the court may feel confident that the discontinuing party would have almost certainly have succeeded if the matter had been fully tried: Lai Qin at 625. The defendant's unreasonableness in defending litigation that it would almost inevitably have lost up to the point of surrender, causing the plaintiff unnecessarily and unreasonably to have incurred costs to that point, may provide the justification for a costs order in favour of the discontinuing plaintiff.
5. As can be seen from the earlier summary of the parties' positions, the fundamental difference between them on the question of costs is whether or not that which has here occurred falls within the class of proceedings identified by Preston CJ in Kiama Council. The Council's position is that what his Honour set out at [80(a)(ii)] (being surrender by the Company - which the Company rejects) is applicable. The Company also rejects that its conduct falls within [80(b)] - thus necessitating consideration of whether or not:

• there was unreasonable conduct by the Company (this being denied); and/or
• whether the Council would have succeeded had the proceedings gone to trial (which the Company also denies).

1. I have earlier dealt with the basis upon which, on balance, I am satisfied that it is appropriate to grant the Council leave to rely on its proposed Amended Summons and proposed Amended Points of Claim.
2. It is to be noted that, in her written submissions, Ms Vatala addressed, at paragraphs 26 to 28, the proposition that the Council's seeking to rely on the proposed Amended Summons and proposed Amended Points of Claim constituted a breach of what was said to be the contractual agreement between the parties to settle the proceedings, "an agreement which is enforceable in these proceedings pursuant to s 73 of the Civil Procedure Act 2005". I have already explained why that proposition is unsustainable as the cited statutory provision is not available to be relied upon by the Company in these proceedings.
3. In order to resolve the fundamental difference between the parties as to whether or not the Company capitulated in response to the Council giving notice, on 2 September 2020, of its intention to file the Notice of Motion and the proposed Amended Summons and proposed Amended Points of Claim appended to it requires a much closer examination of the relevant correspondence.
4. Critical, for this purpose, is the communication from the Council's legal representative on 2 September 2020 and, equally critically, is the response from the Company's legal representatives to it.
5. I have earlier set out Ms Vatala's summary of this correspondence in her written submissions.
6. In this context, it is appropriate to examine closely her description in those submissions of the letter of 14 September 2020 sent on behalf of the Company in response to the Council's Notice of Motion. It is necessary for this understanding to repeat what Ms Vatala wrote at paragraph 17 of her written submissions concerning this correspondence. This element of her submissions was in the following terms: j. 14 September 2020 (Tab 11, p 183 of Ex SV-1) - Dentons letter (following the directions hearing in the Class 4 proceedings on 4 September 2020 at which the Council's Notice of Motion was set down for hearing on 2 October 2020) setting out, amongst other things; i. …; ii. Kiangatha's renewed offer [emphasis added] to provide an undertaking to the Court and to the Council to complete the works required by the Development Consent by 31 March 2021, given the Council's motion to amend and in an effort finally resolve the Class 4 proceedings; 13 90926017.1
7. For the purposes of my consideration, it is necessary to turn to examine, with precision, the detail of the 14 September 2020 letter itself. To understand how I should approach this letter, it is necessary to reproduce only portion of it. The relevant paragraphs are in the following terms: 1 We have previously advised that our client will give an undertaking to the Court and to the Council to physically commence the Development Consent by 31 December 2020. 2 If our client physically commences the Development Consent, but does not complete the works, then the Council has power under the Environmental Planning and Assessment Act 1979 to issue a "Complete Works Order" requiring our client to complete the required works within a specified timeframe. 3 In our opinion, this provides sufficient comfort to the Council that the works required by the Development Consent will be commenced and completed. Renewed offer to resolve Class 4 proceedings 4 However, we observe that your client is now seeking to amend its relief in these Class 4 proceedings to seek an order that our client complete the works required by the Development Consent by 4 December 2020. 5 As you may appreciate, given the COVID climate, our client is having great difficulty in finding a contractor who can carry out the work. So far, all contractors are fully committed with other projects. Further, as we near the summer months, our client is concerned about the potential bushfire risk with contractors working on the property from December-February. The summer bushfires of 2020 swept through part of our client's property, so the risk is a very real one. 6 In the interests of resolving these Class 4 proceedings, but having regard to the above circumstances, our client is prepared to give an undertaking to the court and to the Council that it will complete the works by 31 March 2021. 7 If our client provides an undertaking, there is no need for an order.

Acceptance of the Company's undertaking

1. As earlier noted, there was some discussion during the hearing as to the timing of accepting the Company's undertaking. It is now sufficient, for present purposes, to observe that the undertaking was proffered and accepted.
2. In their letter of 14 September, the Company's legal representatives suggested, amongst other things, that there was no necessity for the Council to seek, through these court proceedings, the imposition of a completion date for the remediation works required to be undertaken as a consequence of the orders made in the Class 1 proceedings. The alternative, it was suggested on behalf of the Company, was that the Council could serve a statutory notice on the Company requiring it to complete the works if the Council considered that the Company was being dilatory in doing so. This, it was suggested, was a complete and sufficient available remedy for the Council, rendering continued seeking of an order for a mandated completion date for the remediation works entirely unnecessary.
3. This proposition is to be rejected. In effect, it constituted an invitation for future disputation and potential delay. Both of these are contrary to the objectives set out in s 56 of the Civil Procedure Act that litigation should seek to resolve all matters genuinely in dispute between parties in a fashion that is just, quick and cheap. The outcome sought by the Council, in its proposed Amended Summons filed on 3 September 2020, to have a court order set a final completion date for the carrying out of the remediation works was one designed to ensure that, if the Company breached such an imposed requirement, any subsequent litigation would be to have the Company dealt with for contempt of court, rather than the potential for the Council needing to seek to impose a contestable statutory order.
4. Such a statutory order, if contested, would lead to further court proceedings as to timing of completion of the works - this, in itself, being a process that would, given the delay that would inevitably arise for the potential conducting of a contest arising out of such a statutory order, extend the completion date of the remediation works. In addition, this would impose on the Council the requirement for further merit legal proceedings and their associated costs which would not automatically be recoverable as "following the event" in such merit review proceedings.
5. For these reasons, given that the Council has now achieved the giving of the undertaking to the Court, breaching of which can be subject to contempt proceedings if necessary, there was significant utility in the Council continuing the proceedings.
6. It was advanced on behalf of the Company that the proposed amendment sought a completion date for the remediation works which was not achieved through the undertaking and the Class 1 development application approval proceeding. This, it was put, as I understood the submission, rendered the proposed amendment ineffectual.
7. I reject this proposition. An examination of the timing of the various steps earlier set out makes it clear that it can readily be assumed that it was the Council's proposal to seek, through this litigation, a mandated completion date and its persistence with that endeavour that caused the Company to offer the undertakings to the Court which have now been accepted as a basis for bringing resolution to the substantive issues in contest in these proceedings. The undertakings in effect represent surrender on behalf of the Company rather than on behalf of the Council.

The cause of the Company's giving of the undertaking

1. Ms Vatala addressed me, at some length during the hearing, as to why I should consider viewing the interrelationship between the Company and WaterNSW (on one hand) or the Company and the Council (on the other) as being woven together so that the outcome of these Class 4 proceedings was not appropriate to be regarded as resulting in an effective surrender to the Council. This is a position which I find simply to be untenable.
2. Put simply, there is a functional sequence of limited outcomes which take place in a very short period of time that provide what, I am satisfied, is the appropriate framework setting out what can be seen as demonstrating the fact that, during the period of August and September 2020, the Company functionally capitulated, entirely, to the Council in a series of linked steps.
3. The below, simple five-step sequence of events demonstrates that, for the purpose of determining whether or not the conclusion of these proceedings is functional capitulation by the Company, has nothing to do with any lengthy antecedent history of interaction between the Company and WaterNSW or the Company and the Council.
4. The sequence in litigation between the Council and the Company of: 1. Agreed Class 1 orders on 21 August 2020 mandating remediation works; 2. A proposal to mandate a commencement date for the remediation works; followed by 3. Acceptance of this by the Company; followed by 4. The Council indicating that it proposed to seek a mandated completion date for the remediation works utilising its proposed Amended Summons in these Class 4 proceedings; followed, within less than a fortnight, by 5. The Company agreeing to such a mandated completion date, can lead to no other conclusion than that there was a completely closed, causal chain from the Class 1 remediation works being agreed leading to the Company, no matter how reluctantly, agreeing to a mandated timeframe within which those remediation works were to be completed.
5. In the context of whether or not the preparedness of the Company would give an undertaking as to a completion date for the remediation works, it is also appropriate to note that, through the conciliation conference process, the functional, relevant outcome of those Class 1 proceedings was agreement on remediation works acceptable to the Council, and for which it subsequently sought mandated commencement and completion dates.
6. This, it is to be seen for these proceedings' outcomes, constitutes the full contextual package of outcomes culminating in the Company's surrender on the final element - the mandating of a completion date for the remediation works.
7. There is no doubt in my mind that this chain satisfies, without any shadow of doubt, that which was described by Preston CJ in Kiama Council and in Ralph Lauren as constituting circumstances of complete capitulation or surrender warranting an "otherwise order" on the question of costs. The necessary "otherwise order" outcome, in these proceedings, must be that the Company is to pay the Council's costs of these Class 4 proceedings.

Costs of the 7 December 2020 hearing

1. The conclusion that I have set out immediately above leaves only the question of whether I should simply provide for the conventional "as agreed or assessed" cost outcome or whether I should take the additional step of making a gross sum costs order.
2. During the course of the hearing, I raised with each of the advocates (Transcript 7 December 2020, page 75, line 18 to page 76, line 25 - exchange with Ms Vatala - and page 79, line 46 to page 80, line 38 - exchange with Mr Hemmings) the possibility that, for any costs order I might make, a gross sum costs order might be appropriate (s 98(4)(c) of the Civil Procedure Act). Submissions were not advanced on behalf of either party suggesting that this would be an inappropriate course to follow.
3. I enquired of Mr Hemmings as to what would be the total costs of the Council (including the costs of this hearing) in order to permit me to adopt this approach, if I considered it appropriate. On instructions, he advised me that the Council's total costs were $179,000 (inclusive of the costs of this hearing).
4. I am satisfied that it is appropriate to make a gross sum costs order because this will bring this disputation to finality and avoid the necessity for any further protraction through a contested costs assessment process (if agreement was not able to be reached between the parties as to the quantum of the Company's costs liability).
5. In determining the amount of a gross sum costs order, it is conventionally appropriate to apply a discount to the actual costs so that the gross sum ordered is somewhere in the range of 65% to 75% of the actual costs' liability.
6. Doing as best I can within this range, I am satisfied that it is appropriate to make a gross sum costs order in favour of the Council of $120,000.

Orders

1. The orders of the Court are: 1. The Respondent's Notice of Motion of 30 November 2020 is dismissed; 2. The Applicant is granted leave to rely on the Amended Summons and Amended Points of Claim annexed to the Applicant's Notice of Motion filed on 3 September 2020; 3. Having granted the Applicant the leave recorded in (2), the undertaking proffered on 7 December 2020 on behalf of the Respondent (reproduced in Annexure A) is now recorded as being accepted; 4. The proceedings are discontinued; 5. Pursuant to s 98(4)(c) of the Civil Procedure Act 2005, the Respondent is ordered to pay the Applicant's costs in the gross sum of $120,000; and 6. The exhibits, other than Exhibit 4, are returned.

Annexure A Annexure A - undertaking (480492, pdf) DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 15 April 2021